#111: Let's hire people randomly!

🥥 Life, work & what matters

October 10th, 2020 - Greetings from Puerto Escondido. I’m settling in down here in Mexico and have been energized by getting back into writing and creating mode after several months of wandering and health issues.

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#1 Should We Hire People Randomly?

We give the Athenians credit for inventing democracy, but in their conception of it, elections were anti-democratic. Instead they used a process which we call “sortition,” a lottery to fill their “citizen’s court.” They even had this handy piece of technology to let them figure out who the random selection of people would be:

I imagine if you brought Aristotle to today’s time, he might be shocked at how we select people for formal roles. Elections? Selection committees? Recruiters?

Malcolm Gladwell explored this topic in an episode of Revisionist History asking a bold question: “should we choose people via lottery?

In the episode he talked to Adam Cronkright who is leading a group called Democracy In Practice in Bolivia and the US. One of the big things they are testing is “democratic lotteries.” One example was in Bolivia where they implemented a lottery for their student council. Not everyone decided to put their name in the mix, but the number of people they had volunteer for the lottery was much higher than if they had ran a typical election process.

The surprising result of the process was that many more people volunteered for formal roles and that the quality of execution and leadership did not decrease.

Can we tell good leaders from bad?

In 1990, the New York Times published an article titled “The Dark Side Of Charisma” which discussed some of Robert Hogan’s research on the current state of leadership in corporate America.  He made the point that while good management may seem easy to spot, it is often hard to differentiate between good managers and those with a “dark side”, often narcissists and psychopaths.

The Times shares his perspective:

Some top executives, who look good to their peers and their bosses and who do well on most assessments, turn out to be terrible for their companies, he said.

''These are flawed managers, whose glittering image masks a dark destructive side,'' he said. ''They end up being costly by creating poor morale, excessive turnover, and reducing productivity. Sometimes they can ruin a company altogether.''

In a later follow-up to the article, Hogan estimated that the “the base rate for incompetent leadership is 65% to 75%.”  Anyone who has worked in a large company can attest, bad managers get promoted over and over again.  While some companies have instituted a “no asshole” rule, it often doesn’t take long to find an asshole in senior management who the team “cannot get rid of” because of some strategic business relationship.

Why don’t people want to be leaders?

I spent a couple years in the executive recruiting industry and it shocked me at how unsophisticated hiring methods were. There is a lot more information than thirty years ago but its hard to say the quality of the decisions is any better. If anything people’s confidence may be lower because of the enormous amount of data.

I was a bit saddened to find many of the executives we assessed lacking in inspiring behavior. This is the case in many companies and people often assume that you need to be a bit of an asshole to be a leader. I’m not sure this is true.

Because of this, many potentially great leaders likely opt out of the “game” before ever giving it a shot.

A fascinating chart in McKinsey’s 2016 report on Women has stuck in my head for years. Not because of what the chart aimed to show but because of the deeper implications.

A surface level view of the chart shows that there is a clear gap in the amount of men and women who want to get promoted and become a senior executive. Yet the more shocking data to me was that only 24% of women and 32% of men even want to and think they will succeed in becoming a top executive.

On top of that, only slightly more than half of men and 40% of women even desire to be a top executive. Is this really the number of people that want to be leaders? Or is this the number of people that want to be leaders given the current way we select and assess leaders?

I bet if we ran more experiments like they did in Bolivia in the corporate world, we would find that the number is much higher.

The long shadow of the extroverted ideal

Susan Cain’s fantastic book Quiet explores the misconceptions with introverts and puts a lot of the blame of our misunderstanding of what an introvert and extrovert on our modern western “extroverted ideal.”

In many ways, this extroverted ideal has become the lens through which we define leaders as good or bad. Here is Cain from an interview on the book:

Western society is based on Greco-Roman ideals of the person that can speak well, a rhetorical ideal. We have always been to some extent a society that favours action over contemplation. But this really reached a pitch when we moved from an agricultural society into the world of big business. And that's when it really became the case that to stand out and succeed in a company, with people that you had never met before, the quality of being very magnetic, very charismatic in a job interview suddenly became very important.

This happened at the turn of the 20th century. And, it was some what coincidentally some what not, accompanied by the rise of the cinema and the idea of movie stars. And so movie stars became the ultimate guide on how to be magnetic and charismatic. So if you were a private person just facing the question of how do I appear at the job interview you go to the movie's a Saturday afternoon and there is a movie star kind of showing you the way. So this became very deeply engrained.

It’s hard to detach ourselves from this idea of leadership. When you close your ideas and picture a leader, you likely picture someone performing the extroverted ideal.

Because of this, our hiring and selection processes across society have morphed to a powerful degree to screen and select for this behavior.

My question is how many great leaders have quit before ever giving it a chance?

My proposal for lotteries at companies

I want to make a proposal that companies experiment with using lotteries to select entry-level employees at their company. I picked entry-level hiring because the potential perceived cost is lower and companies might be interested in re-allocating large recruiting budgets elsewhere in the company.

I would propose re-allocating 80% of the entry-level hiring budget to higher salaries or training. At some companies this could be huge. At strategy consulting firms, for example, the companies start recruiting people years before they may start as a full-time employee and have enormous headcount devoted to such efforts.

For the lottery I’d propose the following initial guidelines:

  • The selection should be opt-in (people can still submit an application)

  • There should be some cut-off criteria like years experience, minimum GPA, or technical expertise

  • The selection process should be done in a transparent way, ideally through a live video stream and with participation of people within the company

The results of such an experiment would be interesting. The company would definitely get a much more diverse pool of new hires and it might encourage more people to apply who might not otherwise apply. It will also make existing employees who are used to hiring a certain type of person a bit uncomfortable.

But if companies are serious about introducing more diversity, including diversity of schools and education and backgrounds, this process should help to shake things up.

I think some of the best candidates may be companies like banks, tech firms and consulting firms which have added so many requirements to their hiring process that it tends to attract solely “world-class hoop jumpers.”

This limits not only diversity, but the creative energy needed to ensure that these firms will remain relevant amid the current technological transformation.

Who’s ready to give it a shot?

#2 Microsoft WFH

Microsoft’s recent announcement about its work from home policy may become a model for more traditional companies. Microsoft has the unique position of being a both a dominant tech firm while still having enough history that it also has the beau acracy of an older larger corporate.

It also has over 150,000 employees and announced that people can freely work from home 50% of the week:

Microsoft will now allow employees to work from home freely for less than 50 percent of their working week, or for managers to approve permanent remote work. Employees who opt for the permanent remote work option will give up their assigned office space, but still have options to use touchdown space available at Microsoft’s offices.

It will be interesting to see if the 50% become a standard perk in the broader business world. If it does, it opens up a lot more possibility of how people might balance work, life, kids and where they live.

#3 Experimenting with video

I have a new camera and I’ve been playing around with putting some videos up on YouTube without overthinking it. If you have a question you want me to answer via video just reply and I’ll do it before next week.

How I find freelance clients abroad

My favorite tool for getting started on something you want to write

My thoughts on “are there too many online courses?”

That’s all this week. If you want to find ways to support my newsletter other than becoming a paid subscriber, I have a number of products I endorse that offer me a kickback if you sign up. You can find them here.