How to hire Ms./Mr. right.

Throw away the cookie-cutter approach to hiring In 1995, as our midsize CPA and consulting firm, Crowe Chizek and Company, based in the Midwest, was creating a new strategic plan, our approximately 1,000 employees were asked to envision recruiting in the year 2000. The firm has recruited college students for over 30 years and currently visits approximately 25 campuses annually. Because the firm wanted to continue to hire people who would succeed in our environment, we investigated the recruiting practices of Fortune 500 companies and of various CPA firms. In general, we found the standard process of hiring had not changed in over 30 years, but a few innovative companies and firms were using behavior-based interviewing. Our firm's leaders were impressed with this new technique and agreed that if we took extra time to learn about potential candidates we would have a better understanding of how they would fit in the firm. We also thought recruits would view our concern for them and their fit in our environment equally important as they evaluated us.

'We chose to use a type of behavior-based interviewing that focuses on the recruits' "core competencies," defined as the underlying characteristics--motives, self-concepts, values, attitudes, skills and knowledge--that have a direct influence on the level of employee behavior, especially job performance.

Our method of identifying core competencies (also known as core capabilities) when recruiting is best described in the article "Using Core Capabilities to Create Competitive Advantage;' Organizational Dynamics, Summer 1995, by Carl Long and Mary VickersKoch: "Companies don't just ask 'What businesses are we in?' and 'What businesses should we be in, given the competitive landscape and forecasts for future changes?' Instead, they pay more attention to the question, 'What capabilities do we need to develop and nurture to take full advantage of those changes?' They are rediscovering the importance of organizational competencies or capabilities as strategic resources--an insight that was largely ignored for a number of years, as companies searched for quicker, more direct means of affecting share price." We knew that creative companies, such as NEC and Honda, were expanding their businesses and outdistancing competitors by examining the competencies of their employees, and we wanted to do the same.

MATCHING THE NEEDS OF THE FIRM

Members of our firm's recruitment task force, which includes partners and senior managers from our accounting and systems consulting departments and the 12 partners in charge, chose a list of competencies they thought were most significant to the firm's success. The consultant then interviewed employees whose performances had been evaluated as outstanding, as well as employees whose ratings had been judged only average, and asked both groups to give examples of recent successes and failures. Responses were recorded and analyzed. The recruitment group then categorized the common themes, such as quality customer service, teamwork and cooperation, and compared the frequencies of themes in both the outstanding and average groups. Themes that were voiced most frequently in both groups were called the "threshold competencies"; themes more common in the outstanding group were called "differentiating competencies."

The task force identified 12 competencies as the best focus for our recruiting process:

* Five threshold competencies in which all successful candidates must demonstrate at least an average level capability.

* Seven differentiating competencies (considered significant for the firm's future leaders) that distinguish the outstanding performers.

Following are behavior-based definitions for both sets of core competencies used to measure our recruits.

THE THRESHOLD COMPETENCIES

Achievement orientation. Holds high standards of excellence; consistently strives for high levels of performance; sets innovative and challenging goals; is outcome-oriented; seeks performance-related feedback to evaluate goals.

Customer service orientation. Has ability, to identify client needs and emotional states; is willing to serve those needs promptly; behaves in a courteous manner.

Flexibility. Can move effectively from one situation to another (working with different individuals, teams and customers as well as different projects, environments and schedules); sees change as opportunity; adapts quickly in a mature way.

Teamwork and cooperation. Can work cooperatively with others; shares responsibility; yields competitive urges for personal credit.

Developing others. Can foster learning and development in others; maintains positive expectations of others; encourages personal and professional growth.

THE DIFFERENTIATING COMPETENCIES

Conceptual thinking. Has ability to understand a situation or problem; sees beyond the concrete; thinks creatively; inductively; generates novel approaches and strategies to new markets and methods of operation.

Self-confidence. Has a high self-regard and a belief in his or her capability; can act independently, takes personal responsibility; rebounds from failure.

Directiveness, assertiveness and use of positional power. Has ability to express orders and bring others into compliance with them; able to adjust styles or expressions of assertiveness to maintain effectiveness with employer, customers and subordinates.

Impact and influence. Can persuade others to accept his or her agenda; takes the initiative to convince others; uses differentially the skill sets appropriate to the situation and consistent with the firm's agenda.

Professional aspirations. Shows motivation to advance and invests the energy to improve technical or managerial knowledge; is willing to expand areas of responsibility and share expertise with others, such as clients, peers and subordinates.

Commitment. Is willing to align his or her behavior with the needs, priorities and goals of the firm; identifies with the corporate vision and is willing to stand for it; makes personal sacrifices to realize it.

Appropriate concern for order, quality and accuracy. Shows concern for monitoring and clarity; checks work and information in a way that does not overemphasize details to the exclusion of other important issues.

EXPECT LONG-TERM RESULTS

We have designed our own behavior-based interviewing course that is mandatory for all staff and partners involved in the recruitment process. We invested a lot of time and money to implement this recruiting process--consulting fees of approximately $50,000 plus the many hours senior staff and partners spent choosing the competencies and training recruiters. We now are redesigning our staff development criteria to implement the core competencies in our performance and career development conferences, in the decisions for promotions and when selecting our future leaders.

We are confident that behavior-based interviewing will lower the firm's turnover rate by achieving a better match with our new- recruits; however, we expect it will be two to three years before we will be able to say with confidence that our employees are happier m their careers, that there is decreased turnover and that we have identified and encouraged our people to grow and create new opportunities for themselves and our clients. Although we are in the early stages of integrating core competencies, we fully expect to reap the benefits of throwing away our cookie-cutter approach to hiring and using this insightful method for years to come.

Behavior-Based Interviews On Campus

We use three, 45-minute interviews when recruiting on campuses. During each of the interviews, all 12 of the core competencies are evaluated. We ask students several questions about their past successes and Failures, work and education experiences and about how they would handle certain hypothetical situations. Each question is designed to assess the student on a number of the core competencies, including values and motivation. A summary of the responses is written down by the interviewer, and each competency is scored directly after the interview'.

After the first interview, we decide which students should be invited back for the additional two interviews on the basis of the total profile of scores on the core competencies. Every student has unique strengths and weaknesses. For example, interviewers can be impressed with the achievements of a student, but his or her scores on customer service orientation could be low. We must decide if this is due to a lack of training or if there is an underlying attitude that would be difficult to change. To do this, we focus particular attention on customer service questions in the final two behavior-based interviews. If we are satisfied that the lack of customer service orientation was based on inexperience and not attitude, we will make the recruit an offer.

EXECUTIVE SUMMARY

* AFTER INVESTIGATING recruiting practices in Fortune 500 companies and various CPA firms, Crowe Chizek, a midsize firm based in the Midwest, began to use behavior-based interviewing that focused on "core competencies."

* MEMBERS OF THE FIRM'S recruitment task force, which includes partners and senior managers from the accounting and systems consulting departments and the partners in charge, chose competencies considered most significant to the firm's success.

* THE FIRM IDENTIFIED 12 competencies as the focus for its recruiting process: 5 "threshold competencies" which all candidates must demonstrate at least an average level of capability and 7 "differentiating competencies," which were considered significant for future leaders because they distinguish the average from the outstanding performers.

* THE BEHAVIO1K-BASED DEFINITIONS include both sets of core competencies the firm considers when hiring new accountants.

* THE FIRM PLANS TO IMPLEMENT core competencies in its performance and career development conferences, in the decisions for promotions and when selecting its future leaders.

JOHN B. HOLDEMAN, CPA, is the partner in charge of firmwide recruitment at Crowe Chizek, South Bend, Indiana. JEFFREY M. ALDRIDGE, CPA, is a senior manager with Crowe Chizek in Indianapolis. DAVID JACKSON, PhD, is a consultant in Ontario, Canada, specializing in selecting and developing financial and high-tech business leaders.

Measuring Performance

When measuring performance, we have developed a behaviorally anchored rating scale (BARS) for each of the 12 core competencies. On a scale of one to six, an employee's performance can be evaluated for each competency. For example, for client service orientation a rating of one says the employee "gives minimal required service without probing for underlying needs, problems or contextual information." A rating of six says the employee "acts as trusted adviser; builds an independent opinion on client needs, problems, opportunities and possibilities for implementation; acts on this opinion; is intimately involved in client's decision-making process and pushes client to confront difficult issues." Ratings of two to five include descriptions of increasingly complete demonstrations of client service orientation.

Selected subordinates, peers and superiors of the employee under review are asked to pick the BARS number that most closely describes the person's behavior. The raters also are asked to write explanations or suggestions the person can use to help develop each competency. The ratings are made anonymously.

BARS ratings are calculated once a year. Each employee is given the average score for each core competency and uses the data in ongoing discussions with his or her career counselor. Each person is encouraged to take the information back to his or her department or "home team," where progress is discussed and team members are asked for feedback.

One of the big advantages of the BARS system is that the employee learns what fellow employees believe is needed to improve his or her performance. The system gives everyone in the firm feedback on the same core competencies, and it aligns the entire firm with competencies Crowe Chizek has deemed essential for competitive success.