Overcome the Hiring Biases in 2024

In the 90’s, a large Italian company was performing poorly in the market, with a fair bit of management issues. Its name was Telecom Italia.?

Telecom Italia was looking for a CEO who could transform the culture and bring stability to the company.?

Franco Bernabè fit the bill right away. He had led the transformation at a large company with similar issues, into a highly respected and profitable business.

Bernabè was considered so apt for his new role at Telecom Italia, that the stock price of Telecom Italia rose 5% the day his appointment was announced, i.e. a multibillion dollar increase.

Something changed after 2 months of Bernabè taking the reins. Telecom Italia became the target of a hostile takeover by Olivetti Corporation, a much smaller company. Bernabè had to quickly tackle this challenge to foil a takeover, a skill completely different from what he was known for i.e. leading cultural change. Olivetti succeeded in the takeover and Bernabè had to step down soon after.

This case study clearly illustrates why hiring based on only previous experience is meaningless. Success in a job depends as much on capabilities that are not mentioned in a CV, as the skills and experience mentioned. More so in today’s era, where the business environment is so rapidly evolving.?

It is not because of ill-intentions that hiring goes wrong in many cases. It is mostly because of the biases we hold or purely the situation. Apart from the social biases of looks, race, demography, here are some of the biases that can lead to wrong hiring decisions.

1. Confirmation Bias:

It is the tendency to favour information that confirms or strengthens our beliefs or values and is difficult to dislodge once affirmed.?

For example, when the interviewer likes the CV, she tries to take the interview from that perspective, overlooking the candidate's weaker points. Even reference checks need to be treated with caution for the same reason. Often, recruiters seek to confirm their evaluation of the candidate from a reference than listen in carefully to what is being said. Apart from that, reference checks are hit or miss because oftentimes the references care more about their relationship with the candidate than about helping a complete stranger to make a good hiring decision.

2. Anchor Bias:

It is a tendency to believe that a new hire needs to be exactly like or exactly opposite of the person who used to do this role. Hiring managers end up looking for familiar personalities of the predecessor rather than focusing on the job’s requirements going forward. It also puts undue pressure on the new hire, not knowing what the previous personality was like. Each person is different and should be hired for their uniqueness, rather than trying to fit in a defined box.

3. Affinity Bias:

When we favour people who are similar to us, we promote affinity bias. Affinity bias can range from similar background, area, educational institutes to even looks or personality. This is the most pervasive bias of all. It often seems harmless as we think praising others is a good thing. What we forget is- when we praise people similar to ourselves, all we do is reinforce our own self-worth.

Affinity bias leads to surrounding ourselves with similar kinds of people. If left unchecked, it leads to collaboration issues when other ideas/opinions from people not similar to a group are dismissed. Or even worse, rather than stand their ground, the person with the contrary opinion keeps quiet to avoid disharmony.

4. Expectation overload:

Job descriptions which are created by everyone in the company who will work with the new hire, are mythical characters like a unicorn. They lack practicality. They create a false expectation in the mind of interviewers, leading to a very long wait. Another problem such JD possesses is that the starting pool of candidates becomes very small, leading to frustration of not finding the right candidate.?

People need to be given a chance to grow in the role; also learn and unlearn a few things.

Here's how can you avoid these biases:

1. Ask the right questions:

Often organisations overcomplicate hiring and end up doing the extremes- either ‘Trust their gut’ or ‘turn hiring into Science’.

Both will not yield consistent decent results. However, a systematic approach greatly improves the chances of hiring the right person all the time. And like all things great, it starts with asking the right questions.?

• How do we tell if the new hire is a success 6 months, 1 year, 2 years down the line?
• Are we sure about her goals for the next 6 months? Is it a moving target?
• What are the personality traits she needs to have apart from skills and experience they possess? How do we evaluate them?

2. Structured Process:

Multiple rounds by multiple people makes it easier to view a candidate from different perspectives. Sharing and discussing notes can highlight biases and allow the team to focus on capabilities only, thus effectively using the collective wisdom within the organization.

Implementing structured interviews with preset interview questions ensures fair and transparent evolution of each candidate. Asking everyone the same questions and letting them complete the same skills tests means all candidates are measured to the same standard.

Knowing the must-haves and good-to-haves competencies/skills in a candidate helps focusing on the right candidate rather than chasing the elusive unicorn.

3. Training:

Hiring is a key function for growth organizations. All key stakeholders are involved in hiring. And yet there is no training or even basic guidelines around the process in most organizations.?

Training people to understand biases makes them more aware. Once you have awareness, you can implement processes to resolve the issue. How to interview, how to evaluate and how to write feedback-all these aspects should be covered in a formal training.

4. Test for EQ:

In his book, Working with Emotional Intelligence, Daniel Goleman mentions that for very senior leaders, close to 90% of success could be attributed to emotional intelligence competencies. Psychometric tests are an excellent tool to?measure and analyze the important aspects of personality and behavior; that are instrumental in determining the emotional quotient of an individual.

Even during the whole interview process, keep an eye out for the traits that are crucial for the role and for your organization. They could be any one or all of the 5 components of emotional intelligence: self-awareness, self-regulation, motivation, empathy, and social skills.

Knowing when to seek help in hiring is also an important step. Hiring can be done in-house for roles which have a talent pool within the organization or the usual roles which you’re hiring for the 100th time. However, for high-level roles or a new role in the organization which also has an impact on the bottom line, companies should seek external help. Also for new markets, diversity & joint ventures, external help for hiring works out better in terms of RoI.

Originally published under Merito Insights.