Summary: In the hiring process, companies often overly rely on interviews, despite their poor track record in predicting future performance and the bias they can introduce. A more effective alternative is to give candidates who pass an initial screening a small test related to the primary skill required for the job. For example, a coder might be asked to complete a brief coding project. This "minimally viable demonstration of competence," coupled with a follow-up discussion, can reveal qualified candidates that traditional methods might miss.
Let's delve into why Assessment Cases outperform Interviews.
Hiring decisions carry significant risks and costs. Delayed hiring can disrupt schedules and degrade service levels, while a poor hiring choice can cost an organization between 30% to 50% of the new hire's salary or more. Traditional hiring methods have always been imperfect, and they are becoming even less effective as the nature of work rapidly changes.
Startups often use a minimum viable product (MVP) to test market interest before committing to full-scale development. Similarly, recruiters can use this concept to gain deeper insights into candidates, streamline the hiring process, align actual skills with job requirements, and enhance diversity in hiring.
To implement this, it's essential to rethink the job interview, which evolved from psychological screenings used during World War I. Even when interview questions are relevant, the interview process itself is a poor predictor of job performance. It tends to favor those who excel at theoretical knowledge and prioritizing information, which may not reflect actual job skills.
Moreover, traditional interviews are prone to bias, leading to the "mini-me" cognitive error, where interviewers favor candidates who are similar to themselves. Organizational psychologist Adam Grant calls this the “I’m not biased” bias. Typically, interviewers mistake a sense of connection with the candidate for competency, which can undermine diversity, equity, and inclusion (DEI) goals.
Despite recognizing the flaws in interviews, many organizations struggle to find suitable alternatives. Personality tests, bot screenings, and assessments of previous work experience each have limitations. While gamification and pre-hire assessment technologies show promise, they can also inadvertently affect hiring decisions related to protected characteristics like race, sex, or national origin.
A superior approach is the minimally viable demonstration of competence, which involves creating a concise, testable task that reflects the job's core requirements. For instance, Jeff, who hired writers for his firm, used scenario-driven writing assignments followed by detailed discussions to gauge candidates' skills and decision-making processes. This method provided a clear understanding of their abilities and enabled hiring from diverse backgrounds based on demonstrated competence rather than resume specifics.
The term "minimally viable demonstrations of competence" signifies a succinct yet effective test that showcases essential job skills. This approach, sometimes called "the reveal," offers a transparent view of a candidate's capabilities, similar to revealing poker hands.
This method is adaptable across various industries, including those with physical or unpredictable work conditions, through scenario planning and AI-enabled VR tools. Observing human reactions in these scenarios offers genuine insights into their capabilities.
Scaling this process is feasible, as pre-hire assessments can be administered widely. Deloitte, for example, uses a minimally viable approach with full-stack engineers by asking them to build a project, thus assessing their actual coding skills rather than relying solely on their resumes.
Human judgment remains a critical component. Steve once hired Ellen, a candidate who did not meet the firm’s typical hiring criteria but demonstrated exceptional problem-solving abilities and maturity. Despite her unconventional background, Ellen is now a managing director in Deloitte's M&A practice, highlighting the limitations of automated screening processes.
Combining human evaluation with well-designed reveals offers a more targeted and predictive approach than the traditional method of processing large numbers of applicants. Although not widely practiced yet, some companies are beginning to challenge traditional hiring methods. Joe Fuller, a mentor to Steve and Geoff, has written compellingly on this trend in HBR. We envision a future where interviews evolve into a series of targeted, minimally viable steps, potentially culminating in a short-term “ride-along” experience. This approach allows for mutual evaluation without immediate commitments. Additionally, integrating the gig economy can create a continuous pipeline of potential full-time hires.
More companies should consider adopting this approach to improve their hiring processes and outcomes.
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