Better to hire big fish from little ponds; Companies are getting better at spotting great character

June 2, 2014 3:34 pm

Better to hire big fish from little ponds

By Philip Delves Broughton

Companies are getting better at spotting great character

In the recent National Football League draft, the New York Giants had an unusual criterion for selecting players from college. Obviously, it wanted big, fast, strong young men, able to endure the brutality of professional American football. But it also wanted them “clean” and upstanding, with no scandals and no behavioural problems. And of its seven draftees, five had served as captains on their college teams.

Tom Coughlin, the Giants’ manager, explained why this mattered: “It’s someone who leads by example. It isn’t about talking; it isn’t about all that stuff. It’s about playing hard, being consistent, having virtues and values that you believe in and are not willing to sacrifice them for popularity.”

It is also about avoiding a scandal like the one the New England Patriots have suffered over the past two years as their former star Aaron Hernandez has been accused of multiple murders. Or that the Giants endured in 2008, when their star receiver, Plaxico Burress, shot himself in the thigh in a New York nightclub with an illegal gun. Even extreme talent is not worth such hassles.

The Giants’ focus on character and behaviour tallies with what a senior executive at a Wall Street bank recently told me about his company’s recruiting policies. It used to be they had their pick of the top students at the top universities. But recruiting them has become harder as their options have expanded. His bank’s solution has been not to hire from lower in the ranks at the same top universities, but rather to take the best students at traditionally lower-ranked universities. It would prefer the top student at Rutgers or the University of East Anglia, for example, than someone coasting along in the middle of the pack at Harvard or Cambridge. Equally, when hiring laterally, it would rather a top performer at a small firm than a middling employee from a rival.

The idea is that there are a few people with exceptional talents, whom everybody wants. But after that, as you try to imagine people’s usefulness in the future, it matters less where or how they were educated, which may come down to luck, but what they did in whatever institution they happened to end up. Did they rise to the top or fade into the background? Did they make themselves distinctive in some way, any way, or did they do the bare minimum not to get thrown out? It scarcely matters whether that institution was the army, a McDonald’s franchise or Balliol College, Oxford. Did they sink or swim? Were they “clean”, to use the Giants’ terminology, or sloppy? Exceptional talent may be rare, but great character is not, and companies are getting better at discovering it.

Laszlo Bock, the head of recruiting at Google, has spoken about the creaky link between past academic performance and professional success at Google. For certain highly intellectual roles, then yes, academic performance counts. But for the rest, grades matter less than the proven ability to learn and solve difficult problems as part of a team. The ability to learn and process information on the fly matters more than standardised test scores. Google wants employees who know when to take control of a situation, and when to step back and defer to others.

In order to gain the experience that develops those kinds of skills and habits, it is no good being stuck behind 100 other jostling alpha types either at university or your company. You might earn some reflected glory from being in their orbit, but your own skills will atrophy. Herbert Marsh, an educational psychologist, found that academically selective schools can have a negative impact on the academic self-confidence of those pupils not soaring to the top of the class. They would be better off at a school with less able peers, where their confidence will grow, where they can lead by example and develop more of the non-academic skills coveted by the likes of Google. He called this the Big Fish Little Pond Effect. It used to be that these big fish suffered from the lesser reputations of their small ponds. But the more sophisticated behavioural interviews now used by everyone from the Giants to investment banks to Google have neutralised this problem. Managers can now cast their net much wider to find the recruits with the ideal character and experience.