On Hiring for Potential
I sat down with legendary NYC-based recruiter Dave Carvajal to discuss what it means to hire for potential. We both tend to agree that “fit” trumps most everything else when it comes to sourcing and assessing for “high potential.”
Jim:
Dave, you are an agent of progress and growth. How do you help founders and executives embrace this strategic view of recruiting and hiring? How do you save organizations from their tendencies to sometimes take the easier path of filling seats, vs. the harder path of hiring for real competitive advantage?
Dave:
The biggest reasons anyone will succeed or fail at any company are twofold. The first reason is by far bigger than the second reason. The challenge is that most people when hiring focus most of their attention on the second reason:
- Fit
- Technical chops
Whether a person’s DNA matches the cultural DNA of the organization is a far bigger predictor of success. When it comes to making your people and culture a strategic advantage, assessing for core fit is a much better way to recruit, assess and hire.
Jim:
If you had to put numbers on them, how much would you weigh the importance of #1 vs #2?
Dave:
Fit is responsible for about 60% while technical chops are responsible for about 21% of the reason why someone will succeed or fail at any company. And I’ve seen this play out at every level of responsibility.
Jim:
About nine years ago I interviewed to be the first account executive at TheLadders.com; you ran HR and Recruiting at the time. At age 28, my resume showed just one full year of formal, professional experience plus a failed startup that I had founded. I met with three or four people at TheLadders, at least two of whom didn’t think I was the right candidate. But you hired me. How did you know I’d be a fit?
Dave:
After rising up quickly at the top tech recruiting firm in NYC, I co-founded HotJobs where I hired the first 500 people, we opened 8 offices around the US, Canada and Australia and had 500% annual revenue growth for 4 years in a row. It was there that I first met and hired the founding team of TheLadders. I was the resident expert on making people and culture our competitive advantage. We achieved this during the first five years of my tenure at TheLadders largely because I insisted on hiring the right people. The important part of all this is simply that in the role of Chief Team Builder or HR, you must drive for business results and connect the dots for the executive team using data and numbers to make a compelling business case for hiring strategically and building high performance teams.
When hiring people who are early in their career and don’t have a long track record or proven ‘technical chops’, it is easy for hiring managers to overlook or simply miss out on properly assessing true capacity for success. What allows for that true capacity for success for anyone joining a new company is a match of their core values and core competencies — these are the two most important things that I attribute to something we call core fit or simply “fit”. Understanding the values of the organization and the competencies necessary to be successful in a role are the key.
In your case, it was easy to see that you were hungry and open. This ‘openness’ is a critical key for continued professional growth. Another word for it is coachability. It allows for lifelong learning and contribution to making everything better.
Jim:
I’ve personally settled in on a very specific definition of “high potential” talent, which for me relates to someone’s ability to have a transformative impact on their team. All of those words are important to my definition.
Syracuse University’s mens basketball team played in the Final Four this year because five years ago, one of the SU coaches saw Mike Gbinjie (point guard) as someone who would thrive specifically within the Syracuse program. Mike carried the team all season and through the tournament. He had a transformative impact on ‘cuse.
Mike was not originally scouted as a top 20 player coming into the NCAA — Duke actually dropped him from their program — but because someone saw his potential to excel at Syracuse, he’ll exit the NCAA with many more skills than he entered with, and perhaps as an NBA player. This case in point is one of many that allow me to easily buy into your assessment that “fit trumps tech chops.”
Dave:
The variables that exist on one team are completely different than the set of variables that exist on another team. For this reason, many hiring mistakes often occur when simply picking someone who seemingly has the ‘technical chops’ from one basketball team or SaaS enterprise company to another. The importance of getting it right on a person’s core fit analysis is so much more important than simply if he played point guard somewhere else. SU coaches were wise to look under the hood for what really matters.
Jim:
In observing how people make hiring decisions, I’ve noticed a type of manager who optimizes for minimizing risk. I.e., they want to fill a seat with a capable, proven entity who won’t screw things up too badly. I think this manager generally looks at a resume and wants to see that a candidate has done the same exact job before, at a recognizable company, ideally for several years.
I think there is another type of hiring manager who optimizes for maximizing the transformative impact of the position. I.e., they want someone who can put a growth curve on his or her back and bend it up, sharply (by the way, I’ve seen this happen at various levels of an org, even in roles like, e.g., Quality Assurance, where having the right person in the role meant a 2 to 3x improvement in the value of the dev team’s output).
This growth-oriented manager might be willing to pass on a so-called sure thing in favor of hiring for certain “x” or “y” factors. How do my observations about risk aversion vs. outcomes maximization compare to your experience working with hundreds of hiring managers and executives?
Dave:
I see this play out day in and day out and am reminded of a quote by Bob Proctor: “Most people tip-toe through life, hoping they make it safely to death.” The primitive, oldest part of the human brain is wired to avoid risk for the purpose of survival. All learning, growth and everything that brings joy in life is outside of our comfort zones. Taking risk is the key to progress and innovation. I’m a big fan of the growth mindset and wrote about it here.
Hiring managers often have difficulty in seeing the promise in people largely because they have fear in their hearts. They focus too much on a candidate’s technical chops and often attempt to ‘play it safe’ by hiring someone who was seemingly successful doing the same thing in a completely different team environment and set of variables. If the core values and core competencies are not right, this will invariably end in disappointment and human suffering.
Jim:
At Portfolium, my job is to help companies scale the way they hire for potential, particularly at the entry level where potential is all you can hire for (since college grads, for example, have a very limited professional track record). Without realizing it, many companies talk out of both sides of their mouths when they post “entry level” jobs that require several years of work experience. I often ask: “Which is it? Entry level OR 3 years of experience?”
What advice would you give to a CEO or head of talent acquisition at a large enterprise or fast-growing startup who is struggling to define and scale their entry-level or internship hiring strategy?
Dave:
First, get clear on the values that this person needs to have in order to fit into the team culture. This is true for all new hires across the organization and at every level of responsibility. Secondly, get clear on what specific core competencies are necessary for this new hire to have in order to be successful in this role. In a role like sales or marketing for example, you might want a high degree of creativity. In an accounting role, not so much.
Jim:
Finally — for people who are invested in moving the needle on these recruiting issues, help us zoom out to understand the bigger picture that we have to affect, including its moving parts. Is it time that we bring Talent Management and HR into the conversation vs. thinking about this as a problem for recruiters to tackle on their own? I.e., how important is it for a company to seriously align its learning/training strategy to its hiring strategy so that, for example, new grads who show amazing upside can be given the appropriate runway to fill certain gaps in knowledge or experience that can only be learned on the job?
Dave:
The most strategic parts of HR are recruiting and culture. These have the power to be completely transformative and a strategic advantage for both startups and large, mature organizations alike. More and more, I am seeing that the CEO’s who make their people strategy a priority are the one’s that disrupt entire industries and markets. No company ever got great because they were awesome at doing payroll or benefits administration (except for the payroll companies). I encourage Boards and CEO’s to have the recruiting & culture building functions that stewart learning, growth and performance in the front office and reporting to the CEO with the administrative functions of HR in the back office, reporting in to the CFO. A good Chief People Officer could also lead both sides of HR and should report to the CEO.
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About Jim-
Jim Milton is VP of Hiring Solutions at Portfolium. Jim has spent 10 years building and growing recruitment technology companies in various roles at TheLadders, LinkedIn, SelectMinds (sold to Oracle/Taleo), and SmartRecruiters. Jim recently fled the east coast to live in sunny San Diego with his partner Alex, and his dog Blue. Jim is passionate about helping employers adapt to and leverage technology to gain a strategic, competitive hiring advantage.
About Dave-
Dave Carvajal is an intrepid builder of billion-dollar businesses, a thought leader in the executive recruitment space, and a man described as an “indefatigable force of nature.” As CEO of Dave Partners, a bespoke recruitment firm serving the high-tech sector, Dave leads an elite, special forces recruitment team that extracts and places the executive leaders that drive high-growth, venture capital & private equity-backed companies to unleash their full potential as they grow.
After a start in corporate finance in the early ’90s, Dave quickly understood that securing and managing human talent was the key to value creation in a knowledge-based economy. In 1997 he co-founded HotJobs.com — and, in just under five years he power-built the fledgling startup to 650 employees, $125M in revenues, and a $1.2B market cap after its IPO. (HotJobs sold to Yahoo! in 2002.) Dave then reprised his successes at TheLadders.com, swiftly building it to 400 employees and $80M in revenues.
Dave now consults with public BOD’s, outstanding entrepreneurs, venture and private equity investors throughout the high-tech sector, advising them on executive recruitment and selection; organizational strategy; corporate values; and leadership.
He founded Dave Partners as both a capstone venture and labor of love: helping build the workplaces that build a better future for us all. Dave Carvajal lives in New Jersey with his amazing wife and their twin sons. Plus Clover the Wonder Dog.
