We have often been in situations where we are approached by clients to re-hire for a senior executive role where the previous hire “didn’t work out”. A large number of these failed hires were not the result of a comprehensive search but, where the company and hiring executive relied on their network and trusted recommendations of individuals who recommended the hired candidate. How could this happen when the professional was recommended by a trusted colleague who had worked with this individual for years, knew the quality of their work, and promised that this would be the best hire they ever made?
Making hiring decisions and choosing the best individual for a job is very complex and difficult and given these complexities, it’s human nature to try to simplify the decision. Relying on the recommendation of a trusted colleague in one’s network is the easiest way to simplify the decision. The thought process goes as follows: “If a trusted individual says they are good then they must be good. – let’s find 1 other candidate to compare them to and make a decision. We need someone in the role quickly and it’s incredible this perfect candidate is available. We need to move quickly and it’s a bonus that we can make this hire with limited effort or resources.”
There are 4 conjoining influences that make this type of hiring a mistake:
1. Your Network Doesn’t Know Your Organization – Every organization and role is different. What makes someone successful in one environment doesn’t necessarily translate to another. People in your network generally have little perspective of what your organization is like and what competencies are needed to be successful in your organization.
2. Network “Agency” Issue – People in your network who recommend candidates not totally discerning and certainly not objective. They often introduce and make recommendations to support their own networking efforts and to help out a human in need. There is no need for them to truly vet the individual as they gain “networking equity” from both the company and the individual for making the connection. At times this leads to people introducing and recommending professionals in a positive light that they may have met only once.
3. The “Halo Effect” – It’s human nature that hiring managers are less rigorous and objective when evaluating a recommended candidate from a trusted source than they are in evaluating a candidate that comes directly. In essence, there is a “halo effect” where hiring managers associate the recommended candidate with the person that recommends them and typically are more forgiving of flaws and potential issues. When a trusted resource recommends an individual, whatever hiring criteria that was established can often be discarded and the recommendation outweighs all other factors.
4. Limited Numbers – The goal of any search is to identify 2-3 final candidates for the hire. The process to get to the top 2 or 3 candidates should go from 50-100 potentials that are interested in the role and then filtered to the top 10-12 viable candidates. Then the top 2 or 3 should be chosen from that pool. However, when a candidate is introduced from your network early in the search process, there is the temptation to jump to the end. Since 1 good candidate was recommended, all that’s needed is 1 or 2 other reasonable final candidates and the search can be completed. Obviously, the problem with this approach is that by short-cutting the candidate sourcing process many, likely better, candidates are never considered. Companies often end up comparing two candidates that are not even in the top 10 of potential candidates. The lack of alternative candidates also enables the candidates under consideration to put pressure on the organization to make a hasty decision.
To avoid falling into this extremely common trap, it’s important to never short-cut the search process regardless of the situation and the initial candidates. Additionally, don’t overvalue leads that come from your network and objectively evaluate those candidates like all others, avoiding the “halo effect”. Most importantly, stay the course with the same search process in all cases:
The cost associated with making a bad hire in terms of organizational disruption and sub-optimal performance far outweighs the additional resources required to do the search comprehensively, even when the seemingly perfect recommended candidate finds their way to you on day 1 of your search.
About the Author:
President, Consulting Services at M&A Executive Search
Dave helps clients solve problems and advance difficult initiatives by providing knowledge and expertise from highly experienced professionals. M&A’s 10,000+ professionals work on a project or interim basis and provide targeted knowledge and expertise to your team on a flexible and affordable basis. Mr. Magnani has 20+ years of professional services experience in a broad number of industries and in various capacities ranging from consulting to managing a $50M professional services organization.
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