How We Measure Quality of Hire at MedAssets

I’ve been seeing the topic of quality of hire appear in articles more and more lately. In fact, the ERE Conference later this month is mainly focused on it.

Much of this conversation is centered on how to measure hire quality and even the role talent acquisition plays in impacting it. Some TA teams feel it doesn’t seem appropriate to hold them responsible post hire for people they do not manage. For teams that do have a measurement, a common approach appears to be tying quality to turnover rates, particularly year-one turnover. The problem with this approach is that it does not capture bad hires who are still employed — perhaps the worst kind of bad hire!

MedAssets approaches this differently. We believe TA absolutely should be responsible for quality of hire, as the role of a TA organization is not just to recruit candidates, but rather to ensure that the hiring teams are positioned to do a good job of hiring through our coaching and influence. And we’re taking a proactive approach to doing just that.

Our goal was to develop a measurement that enabled us to continuously improve our recruiting process and the results we are getting. That is where our measurement comes in. The old adage “if you want to improve something, first you must measure it,” is very applicable here. This measurement helps us recognize where we have opportunity to improve our hiring practices. This is not about raw numbers, although you will see there are plenty to analyze, but rather about continuous improvement. Here is how we are approaching it.

First, we implemented an interview and evaluation approach that starts with identifying the critical skills and competencies needed in each open position. Prior to interviews, the hiring manager is asked to define five to eight critical skills and competencies that are needed to be successful in the role. This serves as the foundation for a structured interview, in which each skill or competency is then rated on a defined scale of one to four. To support this process, we’ve rolled out interview training that shows our hiring teams how to conduct and evaluate the interviews and ultimately rate the candidates in each area. These ratings provide a snapshot of what we think we are getting in our new hire.

After a hire has been with us for 90-120 days, and the hiring manager has had an opportunity to see the new hire in action, we go to the manager and ask him or her to rate the new hire again, using the same rating scale and on the same skills and competencies we determined initially. This gives us a quality-of-hire rating, and also provides a comparison to what we thought we were getting. In other words, how well did we make our evaluation? Did we get what we thought we were getting?

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In all, we capture the skills and competencies of each new hire, who on the hiring team interviewed and evaluated each person, and the one-to-four rating for each skill or competency.

We also tie the data back to a variety of typical hiring data such as who the hiring manager is, the department, business unit, source of hire, time to hire, and the recruiter. This enables us to analyze the data in a variety of ways and helps us identify areas of opportunity. What groups need additional coaching? Are there skills or competencies that we are consistently hiring below or above compared to what we think during the interview process? Is there a particular interview participant who needs coaching? Do we get our best hires from internal candidates, employee referrals, search, or job boards?

I’ll be the first to say that this is not a perfect measurement and certainly has limitations. The measurement only works well if we identify the correct skills and competencies on which to focus. The rating system, no matter how well defined, is still a subjective rating. Taking the measurement in the 90-120 day period is debatable, because ideally you would take a longer term view of a new hire, but you want to get feedback fast enough to take action on it.

That said, this measurement does provide great feedback, gives us actionable data, reinforces a planned and structured interview which in turn improves the candidate experience, and overall it provides a platform for us to continuously improve our hiring practices.

Chad Godhard has more than 19 years recruiting experience with technology-based companies. Currently he is the VP, talent acquisition, for MedAssets, a healthcare performance improvement company that combines strategic market insight with rapid operational execution to help providers sustainably serve the needs of their communities. The company serves more than 4,500 hospitals and 123,000 non-acute healthcare providers.

Prior to MedAssets, he led recruiting teams for Amazon and Sage and was a contract recruiter for companies such as Lucent, WebMD, Novient, 2order.com, Intellimedia, and Homebanc. He started his career on the agency side with Aerotek and has a B.S. from the University of Maryland. He is active in the Atlanta Directors of Recruiting Roundtable and the Technology Association of Georgia Recruiting Society.

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9 Comments on “How We Measure Quality of Hire at MedAssets

  1. Great stuff. I like the link to critical skills and behaviors and the rigor through the process for both recruiter and hiring manager. I’d like to see data over 24 months though – so you can truly identify superstar performers. They can only distinguish themselves in a meaningful and measurable way over time.

    1. agree, the longer term the better. Ideally, we’ll look to measure at 12 months and then perhaps beyond.

  2. Seems to me that there are three areas that are so far beyond TA control that to hold the TA group in thrall is completely wrong:
    1. Incompetent managers who have not the first clue on good interviewing or hiring practices.
    2. Managers who, during the interview, oversold the position(s) and then pigeon-holed the new employee in a lesser position
    3. A situation where the manager that hired the person leaves within 3 months of the candidate’s hiring. Yes, this does happen…and it has happened to me…twice.
    These are the most egregious of the issues that are beyond the TA groups ken. It is my experience that there are way more “Peter Principle” managers out there than we wish to acknowledge. Not every organization has wonderful manager polishing training. Most don’t. We need to be realistic.

    1. Thanks for the comment Bill – I think the 3 examples you provide can all be realistic scenarios where the TA team should be in position to recognize and coach the business leaders if needed.

  3. Great article, Chad! I am curious to know roughly how often and by how much the measures are off. I would think you should not see much difference, but what have you seen?

    Also, how strongly do you make the recruiter responsible, because the hiring manager ultimately decides on the measures and if everyone in the process scored the person high…it is unfair to put it all on the recruiter the hiring manager and interview teams mistakes. You can only coach so much…they often do what they want to do.

    If you do tie the recruiter’s performance to these numbers…do you tie the hiring manager’s performance to these numbers as well. That would keep the playing field even and make hiring managers more receptive to the suggestions of the recruiter.

    1. good question, the majority are similar….which is good, that’s an indicator we are making good assessments during the interview process. But, there have been multiple examples where we missed though, and that is the point, to be able to more easily ID the areas to improve. We look at is as an indicator of how good the partnership is between TA and the hiring teams, and position it as such where there is an opportunity to improve. It’s not TA or the Interview teams mistakes independently.

  4. “The problem with this approach is that it does not capture bad hires who are still employed — perhaps the worst kind of bad hire!”

    Excellent point, which is why turnover isn’t the only measure; performance matters as well. And, if they truly are a bad hire, why wouldn’t it show up in their performance? Or, is is a ‘bad hire’ because the manager says so, despite performance, which I’ve seen dozens of times, and more often than not comes down to, “I don’t like this person for X Reason, so let’s get someone else, despite the fact that their performance is fine…”

    TA should absolutely be responsible for quality of hire, you’re correct. It’s just that quality of hire has to be determined beforehand so they can be held accountable for delivering that, as a deliverable, and the managers they’re delivering to have to agree, and then they have to be responsible for what happens afterward.

    I certainly like the idea of trying to measure a person’s assessed skills against what they managed to demonstrate, but that approach seems like it would work best for roles where the recruiters can be expected to have expertise in determining all needed technical skills for the role. However, to do that adequately for all roles would require specialists in all departments. So, to use my last company as an example, where I was the only recruiter for years, and then one of two for a short time, I would have had to have been an expert in: Mechanical Engineering, Electrical Engineering, Manufacturing Engineering, all facets of Accounting from General to AP to AR, all facets of Marketing from Graphic Design to Copy Writing and Editing to Trade Show Management, all aspects of Manufacturing from Material Buying to Production Scheduling to Inventory Management to Production Management to Distribution, all the way down to the Pickers and Packers, Project Management, both field and in house, both construction and technology, and then of course all the IT, from basic Help Desk to Networking, to Software Development, including several languages. And that was just one company, and throw the Customer Service and Order Entry people on top of all that for good measure, tell me, who can be an expert in all those fields and competently assess people’s skills in them? Seems like a lost cause from the beginning, given how much companies tend to want to invest in HR and recruiting, or how much they don’t want to invest, to be more accurate.

    What you lay out if a good framework, my worry would be hitting a wall where expecting the recruiters to be able to evaluate people’s skills in too many areas would necessarily lead to areas of weakness that couldn’t be addressed effectively. My guess is you could compensate for this with technical assessments to a good degree, but then the hiring process gets stretched out, and hiring managers will often ignore tested results for their own reasons, which sometimes make sense and other times are just BS. What’s more, there are bad managers out there. Tons of them, to be frank. Feeding a good product into a poor system produces poor results. Take the world’s worst driver and put him in a formula one car, he’s going to crash and burn. Does that mean the car was poorly designed and built?

    The reality is you can’t address quality of hire without also addressing quality of manager, and quality of company. The latter two will have a much stronger affect on people’s performance and tenure, and they are also almost always assumed to be beyond reproach, when in reality they are often the root of the problem.

    1. I think your idea that it should be performance related is a good one, ideally we would measure objective performance metrics. We are making the leap that the skills and competencies are going to be indicators of performance. I hope we can get to that. Regarding the expertise of our TA team, and most TA teams, we do not need to be an expert in any functional area to make the assessments, but we do need to be excellent consultants so we can guide the hiring leaders to make the assessments of the skills and competencies identified.

      1. That is good to read, because a lot of people don’t realize that when they put the hiring entirely on HR/Recruiting, that’s what they’re actually asking for, which is moderately insane. If recruiters can be consultants teaching people how to hire, that’s more than workable, it’s ideal. But then the quality issue would seem to get muddy because the HM was as instrumental as the recruiter, if not more so, in the hire. Do the metrics/quality system allow that level of insight?

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