1.12 Tradeoffs in Hiring

One startup founder asked me – “Can you help me hire a rock star PM in the next 10 days?”

In another time, a Product Director from an MNC was telling me – “I feel that we end up rejecting good candidates too often for flimsy reasons. Any idea how to reduce that without reducing the quality of the hires?” 

My reply to both – “You cannot have the cake and eat it too” and drew the two trade-off curves (attached in this post). 

What I was referring to are the two important trade-offs that every hiring manager should acknowledge and accept. These are – 

  1. The faster you want to fill a position, the lower the bar you need to accommodate. On the corollary, you need to give more time to hire high-quality candidates. 
  2. When you try hard to ensure that you hire only the right candidates (i.e. reducing false-positive hires), you would also end up rejecting some of the good candidates (increase in false negatives). 

Barring a few extraordinary situations, a hiring manager should always prioritize minimizing false positives at the cost of higher false negatives. 

But what if you can have the cake and eat it too? 

The key is finding activities that push the frontiers of the trade-off curves. For example, having a solid reference check process can reduce both false positives and negatives at the same time. 

Discovering new channels to find candidates, improving the company’s brand & even a higher than market pay can reduce the time to hire without compromising the quality. 

What other ways can you think of to push the trade-off curves? 

Thanks to Vivek & Srinath for these insights 

Picture of Venkatraman RM

Venkatraman RM

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