---
title: "Sausage Making: Recruit Talent Better Than You"
description: Summary of Edison 2014 CEO Summit sausage-making session focused on recruiting A-players.
---

[Edison Blog | Insights for Growth Stage Technology Companies ](https://www.edisonpartners.com/blog)

# [Sausage Making: Recruit Talent Better Than You](https://www.edisonpartners.com/blog/sausage-making-recruit-talent-better-than-you)

 Written by [Kelly Ford Buckley](https://www.edisonpartners.com/blog/author/kelly-ford-buckley) | 7/14/2014

Building exceptional teams is a strategic imperative for Edison and our portfolio company CEOs. It’s arguably the single most important driver for a company’s success in accelerating growth, market leadership, differentiation, a scalable business model and ultimately, enterprise value.

This is no secret, yet so many CEOs and executives treat developing management as an afterthought, and not as a consistent, relentless process. They may say it’s important, but few live up to making it a priority.  

- Does your company have an actual process that’s persistent?  If not, why not?
- Do you know your hiring batting-average and cost of hiring mistakes, just as you know other metrics tracked in your business?
- How do you map organizational gaps and changes to the company’s strategic goals?
- How do you ensure you’re sourcing awesome talent?
- How do you ensure you’re recruiting and hiring the highest performers?

At Edison’s 2014 CEO Summit last month, I moderated peer-group, sausage-making sessions on these topics, led by [James Green](http://www.linkedin.com/in/jamesangreen), CEO of [Magnetic](http://www.magnetic.com/) and [Tim Davenport](https://www.linkedin.com/profile/view?id=1285419&authType=OUT_OF_NETWORK&authToken=mvjx&locale=en_US&trk=tyah2&trkInfo=tarId%3A1405108884190%2Ctas%3Atim%20dave%2Cidx%3A1-1-1), former CEO of Best Software, respectively (both are also active members of the [Edison Director Network](https://www.edisonpartners.com/edison-edge)).  There were five bottom lines:

 

1.        **Hiring Process is a Must-Have**

The best companies have a defined process that’s proactive, well defined, well understood and adopted by the exec team, all managers and the board.  Not surprising, right? Yet, less than 20% of companies tend to have this in place. Hiring processes need to be a constant and tracked in management meetings, not just at board meetings or in annual planning. Additionally, in order to power through and avoid stall-points, the best companies analyze medium and long-term business strategy imperatives and make sure the key players are added ahead of the curve – this is what it means to be proactive. Continuous assessment and preemptive upgrades were also mentioned by the group as key steps to team success. Top CEOs [dedicate 20% of their time](http://saastr.com/2013/02/08/post-traction-you-need-to-spend-20-of-your-time-recruiting/) focused on building strong teams and leading by example -- those that don’t, risk mediocre results.

1.        **Avoid Hiring Mistakes**

Data shows that hiring batting-averages across companies are in the 50% range; the same as a coin toss. The cost of mis-hiring at the exec level can reach a [staggering $1.5M or more](http://www.boyle-associates.com/blog/the-1-5-million-dollar-mis-hire), driven by compensation, and, more importantly, wasted budgets, weak hires and opportunity costs. If you’re not alarmed, you should be. Root-causes of hiring mistakes link back to lack of a good process -- unclear requirements, vague job descriptions, ad-hoc interviewing, gimmicky tricks like psychological tests and not evaluating culture fit. In our experience, having a hiring process has proven to improve hiring success from 50% to 90%.

 

1.        **Build Performance-Based Role Descriptions**

This may sound pretty mundane, but without starting off on a specified path, the end result is bound to disappoint. Most companies use job descriptions, usually an amorphous outline of tasks for the role. Instead, some CEOs suggested using an objectives-based, quantitative scorecard that describes what elements make a winning exec. Map candidates to scorecard objectives and have tripwires to avoid mistakes before hiring. Athletes with specific skills that fit a scorecard trump all-around athletes in execution. Also, group interviews are encouraged, as well as ensuring candidates meet a broad set of employees to test cultural fit.

 

1.        **Sourcing Awesome Talent  **

Referrals from business colleagues and personal networks yield [up to 70% hiring success](http://www.ere.net/2012/11/12/motivating-employees-to-make-referrals-determining-the-most-effective-rewards/). A best practice is to make a list of the top ten peers you most admire and go to them for the most talented candidates. Build a virtual bench and have your direct reports do the same – and combine that with manager and employee referral programs (that pay well). In-house recruiters can be an acceleration lever on top of these activities once a company reaches 50+ employees.  Hiring costs will add up whether investing in-house or with recruiters, but consider that recruiting fees, consultants and your time are all a small percentage of a) avoiding a $1.5M+ mistake and b) the upside results and power of getting the hiring right. 

5.         **Selecting A-Players**

Back to the scorecard practice, our CEOs were proponents of training themselves and managers to interview on a [performance-driven, fact-based basis with a scorecard](http://www.salesbenchmarkindex.com/bid/102697/The-One-Thing-You-Cannot-Skip-When-Hiring-an-A-Player), vs. in an artisan-mode, story-driven format with a resume.  A scorecard approach should include a list of major green flags (e.g., has a plan of action, consistently promoted, recruited away, shared successes, acknowledged failures) and red flags (e.g., gropes for plan, no mention of mistakes, we failed, but I succeeded attitude, pushed out, never had to fire anyone).  Some recommended conducting broad-based reference checks with 10+ sources, with at least half not provided by the candidate. The best CEOs always conduct reference interviews themselves for executive hires, avoid happy-years, gauge against the scorecard, and don’t miss reading between the lines.

 

What are some of your company’s proven practices for recruiting A players and building A teams?  I’d love to hear from you here, or feel free to email me directly at [sever@edisonpartners.com](mailto:sever@edisonpartners.com) .

 

[View full post](https://www.edisonpartners.com/blog/sausage-making-recruit-talent-better-than-you)

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