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Values-Based Hiring as the Leverage to Building High-Performance Organizations May 08, 2003 By: A commonly heard statement floating around the business world is that “people are hired for skills, and fired for lack of cultural fit.” This is interesting considering that individuals are typically determined to be a fit for an organization by analyzing the breadth and depth of desired skills and experience. Truth be told, attention to cultural fit, if it happens at all, generally occurs as an afterthought. It is given the least amount of consideration in the interviewing and hiring process and is usually dumped into the “gut feel” category. It is fair to say that across the broad spectrum of today’s current hiring and promotional practices, matching someone by their cultural fit into a company is not a priority and rarely occurs. Consequently, when the person with the “best skills” ends up a cultural mismatch, she is fired or eventually resigns on her own accord at a significant cost to the organization in time, money and lost opportunities. The countless number of times this happens throughout the business world leaves HR and executive teams scratching their heads, wondering, “What went wrong?” and “What can we do to stop future mis-hires?” The answers to these two questions are actually very clear and surprisingly simple. But first, we need to define what is meant by the phrases “cultural fit” and an “organization’s culture” and what to look for to give you insight into distinguishing that fit and culture. Edgar H. Schein, Ph.D. is one of the foremost thinkers and authors today on determining the culture of an organization. In his book, The Corporate Culture Survival Guide, Schein defines culture as “the sum total of all the shared, taken-for-granted assumptions that a group has learned throughout its history.” So, culture is determined by the underlying assumptions and beliefs that people have and share with each other, whether these are openly discussed or just assumed. It is generated by the original mission and vision of the founders of a company and is enriched by the tacit assumptions on how things are done. You can get a feel for an organization’s culture by looking at its artifacts, structural and infrastructural elements defined by marketing materials, memos, emails, regulations and policies. It is determined in people’s conversations, actions and behavior and in the underlying beliefs and values of the organization, both declared and assumed, which breathe life into people’s actions and their behavior. The natural relationship between culture, values and behavior has been understood both empirically and scientifically for ages. This is exemplified in the following thoughts by well known authors, thinkers, historical figures, and folk wisdom. • "On a group of theories one can found a school; but on a group of values one can found a culture, a civilization, a new way of living together among men." -- Ignazio Silone • “The reputation of a thousand years may be determined by the conduct of one hour." -- Japanese proverb • "Talking isn't doing. It is a kind of good deed to say well; and yet words are not deeds." -- William Shakespeare • "Our deeds determine us, as much as we determine our deeds." -- George Eliot • “Ethics is a code of values which guide our choices and actions and determine the purpose and course of our lives.” -- Ayn Rand • “It is easier to exemplify values than teach them." -- Theodore M. Hesburgh • "If you want a quality, act as if you already had it." -- William James • “Pay attention to what someone does, not just to what someone says.” – American Folk saying These quotations all point to the same phenomenon, the relationship between culture, values and behavior. So, if you want to determine whether someone is a cultural fit, what you’re really asking is, “Do the values reflected in an individual’s behavior match the desired behavior that is representative of the organization’s values?” It is by asking this question and distilling the answer that the cultural fit between a person and an organization can be determined. Now, when we address the original question, “What went wrong?” the answer becomes clear. Virtually all of the hiring and assessment tools in use today focus on skills and experience, including those touted as “best practice” that use past behavior as a predictor of future performance. Because of this, the seemingly obvious and well-chronicled relationship between behavior, culture and values is ignored. Therefore, interviews are not structured to include an inquiry into an individual’s past to ascertain the degree to which he has exhibited behavior that is most representative of the organization’s cultural values. Hence, even when using behavioral interviewing methodology, or some other process focused on matching skills and experience to past behavior, cultural fit isn’t a direct result. The path of least resistance is to chart the skills and experience of a person and determine whether or not she is capable of accomplishing a necessary task. However, this knowledge gives you minimal insight into her personality. By comparison, defining a person’s values and validating them by discerning past behaviors is a much more complex feat. If the goal is to decrease mis-hires and promotion errors, then continuing to take the easy way out in the assessment process will not deliver the sought-after result. The crucial role that values and culture play in the management and operation of an organization is becoming more widely acknowledged with the current emphasis on ethical behavior as a major component of the Sarbanes-Oxley Act 2002. Cynthia Glassman, a SEC Commissioner, in a recent speech commented that: “First and foremost, Sarbanes-Oxley makes clear that a company’s senior officers are responsible for the culture they create, and must be faithful to the same rules they set out for other employees.” The management of corporate culture and its underlying values is one of the hottest topics in the business community in general. This is exemplified by Lou Gerstner’s recent thoughts about his experience in engineering the turnaround of IBM: “The culture didn't want to change. It didn't buy into the strategy. The culture, which is made up of all kinds of practices and behaviors in the institution, fought the change. So what you have to do is go in and change all the processes that underlie cultural behavior. We changed the compensation system. We changed the organization system. We said, it doesn't matter any more what your unit does, the whole company has to succeed before you get any payoff” (BusinessWeek Online, November 18, 2002). Noted professors of organizational behavior at the Graduate School of Business at Stanford, Dr. Charles O’Reilly and Dr. Jeffrey Pfeffer, observe that many organizational leaders tout their corporate values, but that developing and managing these values is difficult to execute: “If the evidence is so consistent about the importance of people to organizational success, why haven’t organizations rushed to implement practices that are consistent with the large body of research evidence? The reason is simultaneously simple and complex. The simple response is that for people-centered practices to work, a wide spectrum of management practices, ranging from selection to socialization to compensation, must be tightly aligned with each other. These management practices must then be focused on building and maintaining core capabilities and on devising a business strategy that capitalizes on the capabilities that have been developed” (O’Reilly & Pfeffer, 2000) Emphasizing values and values-based behavior in the hiring process yields far more significant results in facilitating a match between an organization and an individual than the marginal improvements seen by focusing on skills and experience. Until HR, OD and hiring executives shift their focus to a values-based approach they will continue to waste tremendous resources and remain dumbfounded as to why their culture remains the same, as does their rate of mis-hires. References Glassman, Cynthia A. (2000, September 27), SEC Commissioner, in a speech given to the American Society of Corporate Secretaries. Reilly, Charles A., & Pfeffer, Jeffrey (2000). Hidden value: How great companies achieve extraordinary results with ordinary people. Boston: Harvard Business School Press. Schein, Edgar H. (1999) The Corporate Culture Survival Guide. San Francisco: Jossey-Bass Inc., Publishers.
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