“You always need to incrementally improve your hiring process. Nothing is set in stone. But once you set that Northern Light of deciding, here's my culture, here's what I'm not willing to compromise, here are some mental mechanisms that I believe work, and then you monitor the performance of the hires that are brought on board via this method. And as you evolve the company, the likelihood that you're going to succeed in finding good people is quite high.”
In this episode
What steps should you take if you are on the fence about hiring a candidate?
Nick Dimitrov, former Amazon Bar Raiser, teaches companies how to hire the best-quality talent that consistently raises their bar.
In episode #90, Nick talks about how leaders can acknowledge and eliminate hiring biases. He also shares who should have the final call on hiring decisions based on the size of a company.
We also talk about defining the bar of an organization and how smaller businesses can compete for talent with large corporations.
Tune in to hear all about Nicks’s hiring habits and the lessons learned along the way!
Like this episode? Be sure to leave a ⭐️⭐️⭐️⭐️⭐️ review and share the podcast with your colleagues.
Get better at hiring
Eliminating hiring bias
Be a culture keeper
Who makes the final call?
Hiring processes based on company size
Mental mechanisms for hiring
On the fence about candidates
30-60-90 day plans
Competing for talent
Aydin Mirzaee (Fellow.app) 00:16
Nick, welcome to the show.
Nick Dimitrov (BarRaiser.io) 01:01
Again, great to be here.
Aydin Mirzaee (Fellow.app) 01:03
Yes, super excited to do this with you. This is one of my favorite topics, we’re gonna talk a lot about hiring. But before we jump in, you’ve had an extensive leadership career, you worked at Amazon as a bar raiser, you’ve interviewed many hundreds of candidates, you helped launch Amazon game studios. There’s a lot that we’re going to dive into. But what I wanted to do was maybe start from the very beginning, this is one of the things we do on the show, which is like, Hi, it’s nice to meet you tell us about your mistakes. So we’d like to know when you first started managing or leading a team. Do you remember what were some early mistakes that you made back in the day,
Nick Dimitrov (BarRaiser.io) 01:39
I first started being a manager slash leader in the early 2000s. That’s gosh, almost 15 years plus ago. And at the time, I started out as a business development person working for Xbox Game Studios in Microsoft, and there was about seven of us on the team, our manager at the time decided to move on. And Job was open, I threw my hat in together with a bunch of the former peers of mine. And I was the person who won the role. I was thrilled for a little bit, but then clashed with the challenges of being a manager. And in particular, I found it very hard to transition from being a former peer, with my team to being a new manager, I’ve made to answer your question every single mistake in the book, and more. One of the biggest mistakes I made at the time was I was trying to be liked by my former peers, I was trying effectively, even to mollify them, if you will, that they were not the chosen ones for this role. And I was. And that’s a obviously a very big mistake. You don’t need to be a best friend with someone that works for you in order to earn their respect. Again, it was tough for me because I pretty much transition from going to these folks, his apartments on Friday night and drinking beers and playing Xbox games, to becoming their manager and writing their performance reviews and setting their goals, which is not a very intuitive transition. But it was a formative experience for sure.
Aydin Mirzaee (Fellow.app) 03:09
So that’s really interesting. Do you remember, like, what allowed you to make that transition? Or was there anything that you realize, Hey, I’ve got to change this for Do you remember what you did to help that transition?
Nick Dimitrov (BarRaiser.io) 03:23
Yeah, I think it’s, I think it’s a trial and error. I think when you are being apologetic beating about the bush, it’s just not furthering the team at all. And you can have an all hands meeting with your team at the time, it was a team of seven that was supporting all the studios, the internal games that Microsoft was, was launching. And when you stand up in front of these folks, it’s you lose their respect, you know, and a much better approach is to go to the management and ask for ABC, I can guarantee you that my team is going to deliver this, but instead, but in exchange, I would need, you know, for you folks to also meet your end of the bargain. And it becomes much more of a productive exchange of value. And when you start going back to the team and delivering the bacon for them and delivering these promotions and delivering those raises the value, they tend to valued much more than then trying to placate them and being buddy-buddy with them.
Aydin Mirzaee (Fellow.app) 04:22
Yeah, cuz at the end of the day, I mean, they’re looking to deliver impact too. So one of the things that you do on a day-to-day basis, you know, outside of like, well, the experience that you’ve had, today, you focus on helping companies hire better. So maybe we can start with the How did you end up getting into like, how did you end up getting into this line of work of helping fast growing companies get better at hiring, and maybe let’s just start with that. Like, why are you so passionate about this area? For sure.
Nick Dimitrov (BarRaiser.io) 04:57
I was, as you mentioned in my briefing drove I was a bar raiser for Amazon for a number of years interviewed hundreds of candidates at Amazon. And for those of you in the audience who don’t know, the bar raiser is one of the very peculiar parts of the Amazon culture. And those individuals have the outsized decision-making authority to determine who to hire and who not to hire. In, in that process, I saw that it’s a very effective decision mechanism for Amazon. But it also had a lot of things in areas to improve. I’ve seen a lot of candidates who are quite highly qualified, who did not get offers at Amazon, because of certain Miss firings and trades that they exhibit and during the interviews that causes them to fail. So that was effectively a loss for both the company and the candidate. So I started out, I’ve always wanted to have my own team and my own company and build something from scratch. I’m an immigrant, I’ve always had this irrational desire to build things from scratch. So I started out with, with a company called Amazon bound, Amazon bound is still ongoing to the present day. And the focus of the company was to help job candidates perform effectively with Amazon and other companies that perform behavioral interview methods. And very naturally, as we were working with individual consumers, companies started to approach this as well and ask us, hey, help us out, set up similar bar raiser organizations in our cultures in order to hire better. And at the time, I started Amazon bounds almost three years ago, at the time, I pushed back these requests, because I was focusing on our primary customer who was the consumer. But in time as I as I was seeing these organic requests flood in, it became more and more obvious that there’s a there’s a great need there. And at first blush, setting up a bar raiser organization and helping companies hire better seems like somewhat of a straightforward ask, Hey, let’s just set up a bar raiser team for for the company and call it a day. But it’s far less simplistic than that the bar razors are the keepers of the flame, they’re the holders of the key to the city of that company. And if you don’t have a claim to keep and if you don’t have a city to pretend there’s no need for a sentinel culture, like a bar raiser organization. So I go back to these companies that had asked them, What are your principles? What are your cultural values? What do you want to be in the top 3% in the world for the things you want to deliver to your customers, and oftentimes, they didn’t get good feedback, because they haven’t been thinking very clearly about those issues. And at the time, again, I decided to focus on the consumer aspect of the business. But then three years, you fast forward to today, we’ve collected a fair amount of wherewithal and we started a dedicated b2b part of the business to companies. And as they say, the best way to start a b2b product is to first prove it out on a b2c level, and scale it as a b2b endeavor. So that’s that’s how we are working with a number of, of scale of teams right now mostly in the tech space, and we’re helping them improve their growth prospects by putting together solid hiring practices that are built from the ground up in congruence with their particular culture. One of the things that’s a hot topic now, is the concept of eliminating bias. So one of the things that you recommend, and you have a bunch of strategies around this, what do you recommend to hiring teams that want to really eliminate bias from the process? Like what are some things that people can do? Yeah, unfortunately, there’s a lot of biases that we commit in our professional lives. And the troubling part is, we’re not aware of them, there needs to be a very, in my opinion, a very deliberate process and method to eliminate those biases one at a time. A lot of hiring biases today would include things like urgency bias, where hiring managers need to put a warm body in the chair because they’re facing a number of deliverables and tight schedules, and so on and so forth. Another type of bias that people often commit is the confirmation bias. That’s the bias where interviewers taint other interviewers about their opinion for the candidate before the other interviewers have even had the chance to talk to the candidate. Unconscious bias is another type of bias that’s that could be rather deadly. The unconscious bias means you associate these mental shortcuts and proxies in forming an opinion about the candidate instead of looking at behavioral data and illustrations about their performance. So for example, if a person has graduated from Harvard, or worked for McKinsey, that doesn’t make them automatically good at math or having strong analytical skills. They might be a math whiz, but you need to establish that with very concrete data and behavioral illustrations. So to answer your question with specific examples, what higher managers can do is engage in, first set up these best hiring practices and then enforce them. And those practices again, they’re built from the ground up. And they’re trying to tackle one of these biases at a time. So for instance, the confirmation bias, a couple of specific steps companies can take is one disallow interviewers to see other people’s feedback before they vote. So you have to submit a written feedback with a higher no higher recommendation before even see how other people have voted. Another mechanism you can use is during the debrief during the interview debrief. You should push your most junior level people to speak first and express their opinion first, and you should ask the senior most people the VPs and whatnot to speak last. Those are specific steps you can take to tackle that the confirmation bias in terms of the unconscious bias. So that’s the
Aydin Mirzaee (Fellow.app) 10:57
Yeah, I was gonna say like before, before we talk about unconscious bias, I think like this is really awesome, right? Because let’s contrast this to the way that I think a lot of debrief sessions happen. So I think the, you know, certainly I’ve been in debrief sessions like this, where we just finished talking to a candidate, everybody gets on the phone debrief. So what did everybody think, right? And then someone might say, something like, I don’t think this person is cut out for, like this role. And then one of the things that you say is like, that’s where someone has to jump in and stop that in its tracks, right?
Nick Dimitrov (BarRaiser.io) 11:37
That’s exactly where we start talking about how to uproot unconscious bias, because somebody could say, hey, Mary is not cut out for this job. And that can be such a pernicious thing to say, because you, you inject this doubt in people’s minds without even knowing it, and without even having specific behavioral data to lean on. So you as the bar raiser, or you as the is the culture keeper, if you will, should interject pretty much like in a Hollywood film, you’re the attorney and you yell, Objection, Your Honor, this evidence is non relevant, you should object and you should say, Hey, why is Mary not qualified for this role? I need you to restate your objection, using data. And it’s okay to have a doubt it’s okay to express a hypothesis that you’re not sure about. But you need to be very, very concrete. To give you an example, maybe in one of your interview questions to Mary, she described the case where she took three months to choose who to award a contract to like she maybe looked at for vendors, and she took a number of months to decide who’s the winning vendor. And in this new job that you’re interviewing for, you need this new hire to express rapid decision making on a daily or weekly basis. So based on how you saw Mary handle this vendor decision, you have strong doubts that she’d be a good fit. And that’s totally fine. But you should express you should articulate the behavioral underpinning that you saw take place, and then present that to the group in terms of a question in the form of a question of hey, is Has anybody else seen something like this, so that it’s perfectly acceptable to, to express doubt, and be devil’s advocate, but you cannot do so on in the form of unconscious bias of using statements like, well, it feels like my gut is like, I’m worried about these things are not cured overnight. It’s, it’s a best practice that you need to have the gumption and the wherewithal to put in place first and then to reinforce on a daily basis with every single interview that you go through.
Aydin Mirzaee (Fellow.app) 13:36
Yeah, this is so important, because you know, so people again, like today, you might get on a call, do a debrief, and then everybody starts talking, and everybody’s a little bit different. So you know, your opinions, you might have an opinion, but then here’s someone else’s, and then you’re swayed by the more charismatic person, or like maybe the more senior person, and all of a sudden, all you’ve done is you’ve just done groupthink. So one of the things you recommend is everybody write feedback, send it to the hiring manager, so that we have everyone’s opinions untainted, and then you get together and then you can discuss after everybody has submitted and do you get a chance to like read each other’s comments as well, after they’ve been submitted? Yep,
Nick Dimitrov (BarRaiser.io) 14:24
absolutely. So it really depends on what kind of technical mechanism you establish, but it’s highly advisable that you read everybody else’s feedback before the start of the meeting. Or if you don’t have the time you spend the first few minutes a few minutes of the debrief meeting, reading everybody else’s feedback in silence. And then the bar is or one of the mechanisms that bar raisers engage in quarterbacking the decision is in a Socratic fashion, going around the table and saying, hey, now that everybody else has read people’s feedback, I want you to go over a few things. One, what’s this person’s biggest strength too? What’s the person’s biggest weakness? And three having read everybody else’s feedback? Do you keep your vote? Do you change your vote, and then you push again, in a Socratic fashion, you have the junior most people go first, everything is based on data as best as possible. And you reach an unbiased as best as you can decision based on feedback in specific areas that other people have reviewed, and not tainted each other and use the debrief to put together that behavioral countenance of the candidate as best as you can.
Aydin Mirzaee (Fellow.app) 15:29
Yeah, I guess like the worst possible outcome is you don’t get submit, submit written feedback, you get on a debrief, the most senior person says, I have a feeling that this person is isn’t cut out to do this job, doesn’t stay to resent her data, and the whole process is completely ruined. So
Nick Dimitrov (BarRaiser.io) 15:49
yeah, and use the bar raiser, you have to step in, and then even counsel even mentor, the the senior most person who committed this after the debrief and say, Hey, even though there might be multiple layers, your senior say, Hey, this is not a substantive feedback. And going forward, you should engage in practice ABC and abandon practice D and F. So everything is based on should be as best as you can based on enforcing behavioral standards and data and best practices.
Aydin Mirzaee (Fellow.app) 16:17
Yeah, this makes a lot of sense. And and it was very interesting. So that’s what the role of the bar raiser would be. So used Socratic method, ask questions and make sure people are arriving at those answers. I think they have the right to veto a decision. But ultimately, like that doesn’t happen very often. But the hiring manager is the decision maker, right, like other people can put their opinions in. But the hiring manager makes the final call.
Nick Dimitrov (BarRaiser.io) 16:46
Well, it really depends on what type of hiring culture the organization wants to instill some hiring cultures that I’ve seen work well point to the fact that the bar is or should have the outsize the kind of unmitigated authority to make or break the the hiring decision, because usually the bar raiser would not come from the same team who interviews the candidate. So so this person by the virtue of coming from a different team, they have eliminated a number of these biases that other people in the team would have. So the bar raiser is effectively they have the YOU SHALL NOT PASS kind of veto. And of course, the hiring manager needs to agree as well. But the bar raiser is the one who can veto everyone. But then to answer your question, if you are an effective bar raiser, you should convince others of your opinion, right? It’s not about you being right. It’s it’s about you reaching through to the other people on the loop and using data and behavioral examples. To change your mind if you have to, right. The point is for you to push for these best practices, whatever the hiring culture is that you’ve instilled in your company and get to that data driven, illustration Driven Decision, and be the guardian of the process and improve the process of time.
Aydin Mirzaee (Fellow.app) 18:03
Do you find that in practice, there are a lot of cases where the hiring manager will make a decision that is like counter to most people’s recommendations, like how does that happen? A lot? Or Not really?
Nick Dimitrov (BarRaiser.io) 18:17
Absolutely. I mean, people come to these interviews with that, as you said, with their personal agenda, and we’re all different and personal opinions. And there’s a number of different permutations that can happen, the hiring manager would be opposed to the hire, and if you’re a bar raiser, and if you’re inclined to hire this person, but the hiring manager isn’t, there’s no point to ramp this person down to team’s throat, because effectively you’re setting the candidates failure going forward, if you can not convince the team that they should be higher, you could take that person and then earmark them for potentially another role for another team with the company. Conversely, when the hiring manager really wants to hire somebody, and use the bar, raise or disagree, it’s up to you to again, to hold that line in disallow the bar to be lower the hiring bar, however, your company defines it to be lowered. So it’s challenging that again, you cannot just bully people around with a decision, you have to convince them that whatever decision we make as a team is based on data and is based on a culture fit. And then you have to look at the candidate, help everybody understand if this candidate raises the bar or not. And then if they don’t raise the bar, then it’s a somewhat of a more straightforward decision of you kind of having backbone and not yielding to the, to the urgency bias to the confirmation bias, so on and so forth. If the team on the other hand, doesn’t want to hire the person, you have to be their their ambassador, if you will, and help them you know, live to fight another day and maybe have other teams that the company look at them for different roles.
Aydin Mirzaee (Fellow.app) 19:46
Right. So you mentioned that you have to make sure that the person raises the bar. So how do you determine what the bar is? This is again that there’s no one size fit all for foreigners companies, I
Nick Dimitrov (BarRaiser.io) 20:00
think it’s it’s very, very important to build something that is aligned with the culture of the company. Having a bar is one of those good mental mechanisms. And when you hire that, that helps you, almost irrespective of what the situation is, or what your line of business is, the area where having the bar helps, is because you set clear standards, whatever those are for the company, whether the, for example, at Amazon, you need to be better than half of the other people who are working at this level. And other companies, you might have to meet a certain level of criteria if you don’t want to pit people against each other, and so on and so forth. But setting the bar clearly helps you eliminate some of these hiring biases again, where, for example, you can have a cohort of candidates in lots of companies, they tend to compare the candidates against each other. And that’s a that’s truly a faulty practice. Because you might have a cohort of people who are all substandard. And then you are making a poor decision. And if they’re all below the bar, you should hire none of them. Or you might have a team, you might have a cohort of candidates that are all exceptional. And if they’re above the bar, you should hire all of them. How do you stack rank the Beatles, for example, right? They’re all exceptional. So you should, instead of trying to compare candidates to each other, you should set this bar that is reasonably efficient, yet challenging to meet. However, this bar, whatever this bar means for your company, and then evaluate each candidate against that bar and find them a home. If they exceed the bar at the right time with the right team, you know, with the right role, so on and so forth.
Aydin Mirzaee (Fellow.app) 21:35
Hey there before moving to the next part of the interview, quick interjection to tell you about one of the internet’s best kept secrets, the manager TLDR newsletter. So every two weeks, we read the best content out there, the greatest articles, the advice, the case studies, whatever the latest and greatest is, we summarize it, and we send it to your inbox, we know you don’t have time to read everything. But because we’re doing the work will summarize it and send it to your inbox once every two weeks. And the best news, it’s completely free. So go on over to fellow dot app slash newsletter, and sign up today. And with that said, let’s go back to the interview. So one of the things that you mentioned is the different companies sizes and stages have different ways of hiring. So I think, you know, for example, if you’re like a three person company, and you just started, this might be overkill. So maybe you can elaborate, like, what kind of a hiring process do you think works at different size companies?
Nick Dimitrov (BarRaiser.io) 22:38
Absolutely. I’ve been very fortunate in my career, to have a very diverse set of experiences, I started the first 20 Some years of my professional life working for big tech companies like Microsoft and Amazon. And the last few years of my professional life I’ve been working with at Baris or had been working with much smaller companies that are growing much more rapidly. So it is you stated, one size doesn’t fit everyone, in my experience, there’s really two determinants to kind of simplify things, which tend to determine what type of best hiring processes might work for your company. And those two determinants are one the size of the company and to the rate of growth of that company. And if we look at these two vectors, companies roughly fall into three cohorts. Starting with Cohort One, those are startups, as you mentioned, people companies with smaller staff, usually those companies have fewer than two 300 people, those are startups that grow very rapidly. And then for those folks, the best hiring practice tends to be give the untrammeled decision, hiring decisions, decision making authority to the founders, because the founders, they have the magic for the company, they know who fits and who doesn’t fit with their culture. And they also have the decision making authority to let someone go, should they make the wrong hiring choice, and they care to do so because the company’s their baby. So the best hiring process, for example, for a small startup that’s growing rapidly, is to effectively let the founders or the founding team have one on one engagement with every candidate, who’s who’s being hired. And that’s going to help ensure that your hiring process screens for people who are aligned with your culture, and doesn’t let the ones who are not aligned to get in. On the other side of the continuum. In cohort three and group three, you have companies that are growing at a much lower rate of growth. Those companies can be large. They can be companies like oil and gas companies or telecom companies, or they can be small, they can be lifestyle type of companies, for example, it could be a video game studios of 200 people that’s been doing business for 25 plus years. There’s nothing wrong with that. So those companies, they don’t have the need for rapid growth, and they can afford to take their sweet time in evaluating for that culture fit for that. For the culture alignment, some of the best hiring practices that these folks tend to engage in our trial employment, for example, those companies, they love to start someone new as a contingent staff employee or an intern. And after a few months, once they’ve proved their mettle, convert them to a full timer, or some of the larger tech companies, they would they tend to interview you extensively, for instance, Google and Microsoft, they would interview someone for two, three months upon end before they make their decision. So for those folks, they tend to be very thoughtful and planful. And that that’s a good hiring mechanism about who fits and who doesn’t. And then the last category of companies are the ones in between, those are companies who have grown past that critical point of maybe four or 500 people in the company, where the founding team can no longer interview everyone one on one. And yet, their growth rates are still quite spectacular, especially if they’re hyper scaling companies, they, if anything, their growth rate is accelerating, because they have money coming in from angels and VCs, mandating them to keep going. So these companies are kind of caught between a rock and a hard place. Because the founders can no longer do the one on one interview that has been so magical and helpful for the company. Yet on the other hand, the growth expectations have accelerated. And these companies, they don’t have a good hiring process in place. And that’s where things start to tend to start to fall apart. And they have a lot of attrition. They have people who don’t accept the offers, they make the wrong hiring decision, which is good, which could be very deadly for the company. And effectively, these are primarily the type of companies who we tend to work with in bar razor, and we help those folks to establish these best practices in the context of their specific culture.
Aydin Mirzaee (Fellow.app) 26:48
Yes, so this makes a lot of sense. So it’s interesting that, you know, at smaller companies, getting the founders who understand the culture, who are going to be there for the long term, to be very involved. And over the course of time, I can see how you would want to create like, other people who can almost be like, where the founder hat, and kind of like be trained and be representative of the same sort of cultural alignment and get them involved in the process. The thing I wanted to ask you about is this concept that you talked about, which is a mental mechanism for hiring, would love for you to elaborate what is a mental mechanism for hiring?
Nick Dimitrov (BarRaiser.io) 27:33
It’s a fancy $20 word, isn’t it? Effectively, what it means is a best practice that tends to be effective and evergreen and work well, regardless of the situation and regardless of the line of business that you companies in. So to give you specific pragmatic responses to, to the question you pose, there’s a number of various hiring mechanisms, mental mechanisms, one of them is to prefer the false positive decision, a false negative mistake versus a poll, a false positive mistake. What does that mean? A false negative mistake means that you don’t hire somebody who would be a fit with your culture, versus a false positive mistake. That means you hire somebody who’s not a fit. The reason why that’s relevant is because making the wrong hiring decisions and bringing somebody in who’s not a fit can be very, very expensive. I’m going to share a number of data points which are not confidential at all these, these are widely known in the industry. But on average, if you hire the wrong engineering, talent engineering individual, that’s going to cost you over six to 12 months to let that person go close to a quarter million dollars or more. Or if you hired the wrong salesperson with their sales quotas in a b2b company, that can cost you anywhere from $1 million plus to 10s of millions of dollars per year. So these types of false positive mistakes are very, very deadly. And as a result, a lot of companies they establish the mental mechanism of if we are on the fence about a candidate, we will vote no. And that’s what we all agree with as a culture. And that’s what we move forward with. As they say, when there is doubt there’s no doubt another mental mechanism, which is more tactical in nature, is to put together as you mentioned earlier, a best plan a best process of putting down notes in writing as you interview the candidate. So you can eliminate the memory recollection and the heat. You said she said type of environment so that after you finish the interview, you have to convert those written notes into a written higher or no higher recommendation with specific justification behind it and submit that higher, higher or no high recommendation, either to a central repository or to an independent person who’s going to collect everybody’s feedback within 24 hours. That’s the best practice another. I mean, there’s countless other examples, but I’ll give you maybe one more another example for a good hiring mechanism is to make sure that you have a shadow program for new interviewers who arrive at your company and put together a relatively stringent plan of having a newbie, Shadow, an X number of interviews and participate is a fly on the wall in X number of interview debriefs before they’re allowed to express a firm written opinion behaviorally about a new hire. And this, this has nothing to do about that this has nothing to do with the person having hiring experience in interview experience or not, they could have ample hiring experience or an area experience outside of your company that is irrelevant, right? Because they might come from very different culture. So you need to institute this kind of onboarding mechanism, if you will, as as much as you can, irrespective of the of the level of experience of your new hires, and make sure again, that they understand their your culture, clearly. And they’re prevented as best as possible for making false positive mistakes.
Aydin Mirzaee (Fellow.app) 31:02
Yeah, this is super interesting from a, you know, we’ve all been in hiring committees where you’re just kind of on the fence with a candidate. So in situations like that, if you’re on the fence, you know, like, like you said, if there’s doubt, there is no doubt. And I think that makes a lot of sense. Another way that I’ve heard that is that there’s got to be at least one person that has very strong conviction, if there’s nobody that has very strong conviction, it’s probably not worth the risk. Because of, you know what it can cost companies by making the wrong it’s a lot worse to hire the wrong person, then rather like wait another even month or two months to hire the right person, because you’re actually going to lose more than that in time. And dollars, if you make the wrong call.
Nick Dimitrov (BarRaiser.io) 31:50
100% agree, as you said, somebody needs to be so vocal and convicted about the decision that they need to slap their badge on the table and say, unless we hire this individual, I’m walking out of here, right? I’m willing to stake, effectively my career, in my judgment call on this person joining the company. And you need to you need to build that balance. Again, you need to base it as much as possible on how well this person aligns with your culture.
Aydin Mirzaee (Fellow.app) 32:16
So Nick, you know, there’s different opinions about this, but because you’ve worked at, you know, a lot of different companies to do this. Well, but also, you’ve worked with a lot of companies. What is the the success rate of hires going through this method? Like, How good can it be? Is, is good? 5050? Can it be like 70%? Good? And how do you how do you determine success rate?
Nick Dimitrov (BarRaiser.io) 32:38
There’s no prescriptive percentages here. But I’ll share with you a few different examples, where it’s somewhat wasteful to over index on false negative decisions, but it protects you culture, right. And if you put together a strong culture in place, that is that you advertise as you best go to market with with new talent, go to market strategy, you will tend to attract new candidates over and over again. And also, if you know, hire somebody, that doesn’t mean that you can prevent them from interviewing in in being hired with your company a few months down the line, because we all change, right? We all accumulate new experiences, you need to keep a permanent file of every candidate you talk to, and then you then you can you monitor their evolution in time. But you absolutely have to stay firm and define that bar, whatever that bar is, you know, if it’s if it’s 5050, it’s unlikely that this is going to be the right decision. If it’s somewhat higher than that you need, you know, that very firm commitment from the team or the bar raiser on what are you going to do to ensure that this person is a fit with the culture and you’ve set them up for success? And if if God forbid, there’s this, the people agreed to disagree, and you’re willing to maybe squint your eyes and take a flyer on someone, then you need to have a very clear plan of what is your unwind decision? How are you going to let the person go if they don’t meet your criteria and your standards, but you have to have some sort of a bar that you have agreed with you have agreed to ahead of time, and you make that bar as objective as possible.
Aydin Mirzaee (Fellow.app) 34:19
And if you do this correctly, like how often do the candidates that you hire end up working out and being successful hires you think
Nick Dimitrov (BarRaiser.io) 34:27
if you do this effectively, and you change it in the context of your own culture, the likelihood that this works out is is is better than 5050? Obviously, there’s no guarantees but you know, let’s take Amazon as an example of people can disagree with their, with their culture and the way they do business, but it’s undeniable that whatever the latest number is, they hire 1.2 million people now, and they’ve scaled quite spectacularly from from being a small company to to the company they are today. And that is to a large extent due to this bar raising process and These unambiguous rules that they’ve set up. And of course, obviously you would, you would change the hiring process you mentioned earlier, where we talked about hiring processes tend to evolve, you always need to incrementally improve your hiring process, nothing is set in stone. But once you once you set that Northern Light of, here’s my culture, here’s what I’m not willing to compromise waive, here’s some mental mechanisms that I believe work. And then of course, I’m going to monitor the performance of the hires that I bring on board via this method. And as you as you evolve the company that the likelihood that you’re going to succeed in finding good people is, is quite high. I mean, a good a good litmus test is, are you willing to walk away from someone and it hurts and you willing to walk away from them, because they haven’t quite met your bar frequently for for senior roles for key roles, it’s not in customary to wait for the right person for six 912 months upon end, you don’t need to rush into these hiring decisions. Because again, you haven’t built this this company, this culture for the short haul, you building it for the long haul. And as Evernote used to say, you build 100 year company, and waiting another nine or 12 months for the right person is, is nothing in comparison to the benefit that they’re going to bring to the table. Once you convince them to join your team. You’ve identified them and you need to turn them into a hire.
Aydin Mirzaee (Fellow.app) 36:24
So once you finish the hiring, so the person’s hired, and now they’re on board, what are the processes afterwards, just to like verify that this was the right hire, like are there things that you do 30 days, 90 days afterwards?
Nick Dimitrov (BarRaiser.io) 36:40
Yeah, for sure. This again, goes into a number of steps you would you would put in place to to ensure that this person is a good fit, and they’re set up for success. But usually a good practice is to set up what some companies call a launch plan, where you clearly identify, as you said, the 3060 90 day plan for the person, you pair them up with with a launch buddy, with somebody who’s effectively a mentor and an official mentor or a peer to peer mentor, you also communicate with them very, very frequently, the culture and the values that we’ve that we’ve been talking about the manifest itself in hiring, but they also have to manifest themselves in every thing that the company does, in terms of what type of projects that company invests in who they promote, how they pursue their their next best strategy, so on and so forth. So if you said these very clear numeric goals, and they’re very specific, and you put them in different buckets of, you know, here’s some maybe rhythm in the business goals, here’s some long term strategic goals, here’s some of these goals are quite measurable, you put the right support structure for this employee, and you you surround him with support, you tend to err on, on processes, where time is of the essence and communication is of the essence over communication is of the essence, you put in place the the structure where should somebody underperform, that should become obvious relatively quickly. And then you have another tough decision to make. If everything is hunky dory, then you high five each other and you move on to the next candidate, in terms of looking for the right handed, if things don’t work out? Well, though, you have to put structure in place to let the person go either correct their performance as rapidly as possible, or let them go. Because it’s it’s so vital for you as a, as a tech scale up or a fast growing company to have everybody over deliver or otherwise you’re not going to achieve your final output.
Aydin Mirzaee (Fellow.app) 38:39
Yeah, that that makes a lot of sense. And so one thing that, you know, maybe a question for folks is if you are working, and we have a lot of folks in the audience that may be don’t work at companies with 10,000 people, but might work for companies with, you know, in the hundreds, or maybe they’re smaller than that and their startups. What are the things that you know, you can do, do you think as smaller companies or someone who’s a hiring manager or leader at a smaller company to convince that very unique and talented person to join your company versus, say that larger mega cap company,
Nick Dimitrov (BarRaiser.io) 39:18
the labor market is so tight, right. And small companies are they usually tend to be at a disadvantage when they compete with larger companies in terms of monetary compensation. And that’s where you need to focus, I would suggest as a smaller employer, that’s where you need to focus on culture. And that’s where you need to focus on things that don’t scale as Paul Graham says of Y Combinator, large companies cannot afford to work on things that don’t scale. And what to give you specific example to your question. A few examples. What this means is focused on very customer obsessed process of interviewing the candidate and then onboarding the candidate. This potentially could mean finding out What are the candidates hot buttons that are non monetary and completely customized on offer that a large company can not afford to make. So for example, if this person is a go getter who wants to work on critical path projects, I mean, give her as much robot she can handle on right out of the gates, and allow her to spread her wings and perform, whereas in a larger company should be expected to maybe earn her kind of key and, quote unquote, and not be given that opportunity to rise right and perform a different example could be now in a in a work from home, remote work type of model, allow this person to be as flexible as he or she would desire. A third example could be be very open about the type of monetary upside that this person might forego accepting an offer by a fan company by metta or someone else. And when you invert these problems and turn them into a benefit for you. And if somebody is willing to mortgage their future for $85,000, in in extra salary annually, then you actually might be better off to let them go. And that might have prevented maybe a false positive decision from taking place. And when I keep harping on cultural advantages over a monetary advantages, I don’t mean to imply that but small companies should not pay their employees. Well, I mean, obviously, sit down with these employees and paint them very would be employees, and paid to them a very clear picture of what would happen if your company continues to accelerate and scale in hid that product market fit and get to a higher scale stage. In that case, the monetary benefit of that your company would provide to this person would like to exceed the monetary benefit, you know, from a fan company. But, again, appeal to the right cultural fit for these employees. And if in a worst case scenario, maybe tell them that, hey, if you join my team, in the next year, you’re going to grow as much as the the stuff that you’ll do for metta, or Google or Amazon for the next 12 years. So come join the team, learn, grow. And then if you want to go work for a large team, a large company a year or two later, you know, knock yourself out. And after working for us for for, you know, a year or two, you’re going to get a much better offer there. And you’re going to further your own, you know, position with that. So, so try to focus on on a right cultural fit in, always invert and be and be flexible as as much as you can.
Aydin Mirzaee (Fellow.app) 42:29
Yeah. And that that makes a lot of sense. So Nick, we’re just coming up on time here. And we talked about a lot of different things. We talked about how to eliminate bias. We’ve talked about different hiring processes, at different stages of companies. We’ve talked about mental mechanism. My favorite one from today is like when there is doubt there is no doubt I really like that in the context of hiring. And of course, how small companies can compete with with larger ones. So one question that we like to ask as a final question for all the guests on this show is for all the managers and leaders constantly looking to get better at their craft of managing and leading teams, are there any final tips, tricks or words of wisdom that you would leave them with?
Nick Dimitrov (BarRaiser.io) 43:16
If I were to start with just one summary advice for everyone is hiring is likely the top competency that you’re going to develop in your company that’s going to enable you to succeed in the long run, do not compromise with it, do not rush into anything. Take your time builds a hiring best process that is aligned with your culture, do it in time iterate on it, and you’re going to be amply rewarded. And then in terms of specific, maybe areas and resources you can go look to find ideas to inspire you to do so. We’re continually learning as we’ve been discussing so far. So some good sources and areas of information could be go talk to your employees, you’d be surprised about the wealth of ideas that they have to improve your company. If you’re willing to listen, go talk to other colleagues that you have from from different businesses. listen to podcasts, like Supermanagers books are always a great resource. I recently finished a great book by Frank Sweetman, the CEO of snowflake, it’s called amp it up. And in the book, he gives a number of really good cultural points of how you can among other things, you can bet on other people’s conviction even if it runs counter to your conviction. And you should again, embrace those different viewpoints and gamble with people give them the benefit of the doubt bet on them, iterate, and hopefully good things are going to follow.
Aydin Mirzaee (Fellow.app) 44:44
That’s great advice and a great place to end it. Nick, thanks so much for doing this.
Nick Dimitrov (BarRaiser.io) 44:48
Thank you, Aydin I was happy to do it.