Why You Should Think Twice Before Hiring Based on Skills

Nearly a year ago, Ernst & Young decided to remove minimum grade requirements—as well as requirements for the type of degrees considered acceptable—for job candidates in the UK. Why?

Having conducted an internal study, the elite global professional services firm "found no evidence to conclude that previous success in higher education correlated with future success in subsequent professional qualifications undertaken." In other words, they recognize that just because a candidate was great at being a student doesn't necessarily mean that he or she will thrive in and contribute to a fast-paced, innovative business culture.

It's nice that Fortune 500 companies are getting on board with what the tech world and entrepreneurs have long realized: It may be better to hire people who have experience outside of racking up an impressive GPA.

Steve Jobs, Mark Zuckerberg, Michael Dell, Dave Thomas (the man who brought us Wendy's burgers) and Richard Branson share the lack of a university degree, but they are also entrepreneurs who have created jobs; as bosses, they weren't stigmatized for not having earned academic credentials.

Let's extrapolate that concept. What if companies stopped stigmatizing candidates for having too much experience (read: being too old)? Having gaps in employment because they took time off to raise families or care for elderly relatives? Having received an online degree instead of a degree from a top-ranked college?

In other words, what happens when companies hire for talent over skills?

MailChimp's former user experience director, Aarron Walter, wrote that "focusing too much on technical knowhow can lead companies to hire the wrong people," advocating instead for hiring people who exhibit intellectual diversity, a collaborative mindset, social aptitude, adaptability and grit. MailChimp is a tech company, but their job descriptions don't list particular types of software as requirements. Instead, they hire for people who get stuff done and with whom others are likely to get along.

David Cancel, a serial entrepreneur and current CEO at Drift, noted that "each time I have built a team, personal traits—not professional skills—have been what propelled the company forward." Cancel weights his wish list: 45 percent cultural fit, 35 percent "scrappiness and drive," 15 percent intelligence and only 5 percent experience. That's right—experience counts for only 5 percent of how he hires.

While examples such as these are inspiring, the reality for most job candidates doesn't sync with this trend. Searching through several job postings in the non-tech sector, I found job descriptions that focus more on specific skills than general talents or traits.

To qualify for the position of Senior Financial Analyst at a major beauty company, for example, a candidate must have a degree in finance or accounting, as well as be able to use SAP Financials, Hyperion, Business Warehouse and CPM. And this is for a relatively low-level position that requires only four years of experience! No traits were mentioned.

Think back to Ernst & Young's decision not to focus on grades when assessing candidates; the company has instead developed online assessment tools that measure the traits that are important to them. While this is a good step away from reliance on grades as a performance indicator, it will screen out potentially great hires who don't perform well when confronted with multiple choice answers.

My argument is that those are the people a company wants— people who see ambiguity in questions and can construct the "right" answer based on variables that exist in the real world—just not in online assessment tools. E&Y's decision is but a baby step, but at least opens the door to further progress.

How does putting the emphasis on traits or culture fit over precise skills translate into organizational success? It depends on how you qualify success. Of the top revenue producing companies in 2015 named by Fortune: Apple, ExxonMobil, Wells Fargo and Microsoft, a scan of each company's job postings revealed that Apple and Microsoft appear to be equally interested in traits as skills, while ExxonMobil and Wells Fargo had heavily skill-based requirements.

But contrast Fortune's list with Inc. Magazine's 2015 list of the most profitable companies in the Inc. 5000. Job descriptions for fourth on their list, Total Quality Logistics, look for customer-oriented people, promising them that "they play as hard as they work," but notes that "slackers need not apply." Coyote Logistics, also top in profitability, has this message on its career page, "We're always on the prowl for people who are True, Tribal, Tenacious and Smart," inviting anyone who fits that description to "join the pack."

While a company's financial success doesn't necessarily correlate with hiring for traits, focusing on an employee-centric culture is certainly valuable. Where people are hired for traits predictive of a value system and work ethic that's in line with the corporate mission, companies will surely succeed with respect to recruitment and retention of their greatest asset—their talent.

Photo: Creative Commons