Is Hiring for Culture Fit Hurting Your Bottom Line?
When corporate culture goes sideways at companies like Uber and now Miramax we’re reminded that organizations with otherwise innovative and sustainable strategies, services, and products can still experience irreparable damage when they don’t get it right. While quoting “culture eats strategy for breakfast” from Peter Drucker may feel like a cliché, creating a healthy culture and avoiding a toxic one remains imperative for successful companies.
We’re lucky to be living in a time when there’s more conversation than ever about diversity and inclusion.There’s available data about how diverse teams increase creativity, improve product design, and benefit the bottom line. I like to think we’re past the days of having to make a business case for diversity. Instead, we can shift the conversation to identifying concrete actions and figuring out how to measure not just diversity, but inclusion. I know there’s lots of talk and more action is needed, but I still want to recognize that the conversation is going in a new direction. I’m personally feeling a little more optimistic about the possibility of change.
Hiring Diverse Talent
Good leaders want to know where to find and how to hire diverse candidates, people who look different from them. Companies are getting better at assembling diverse interview panels that reflect their candidates. They support grassroots employee resource groups, and participate in recruiting events specifically aimed at meeting more women and underrepresented minority candidates.
New tools like Textio enable companies to make job descriptions more appealing not just to female applicants but to all applicants. Talent Sonar facilitates blind resume reviews so that employers can select candidates without seeing the person’s name or alma mater, information that often leads to unconscious bias. I’m not saying we’ve figured out diverse hiring, just that we’re beginning to see progress.
How Culture Fit Promotes Bias
But culture fit may have become our biggest, least recognized roadblock to increasing diversity. Culture and diversity clash when the word culture becomes a proxy for “people like me.” Research shows that a hiring manager spends on average 30 seconds or less reviewing a resume before putting it in the yes or no pile. At that speed, bias kicks in and we’re all more likely to favor candidates who look and think like we do. The same thing happens during interviews – when culture is not clearly defined as a set of specific behaviors, attitudes or values, it’s prone to become a proxy for people like me.
Fit is hugely important and has many short term benefits. In the long term, those same benefits lead to risks that can bring a swift end to agility, innovation and the ability to respond quickly to outside pressures. Consider these alternatives that let you hire people who will enhance your culture, while increasing as opposed to decreasing diversity.
Culture Add aka Cultural Contribution
There are a number of articles on the idea of culture add including one in Forbes The End of Culture Fit and a Adam Grant’s video Hire for Culture Fit or Culture Add? Grant cites stats demonstrating that Silicon Valley startups who hire for culture fit vs. skills or raw smarts fail less often and IPO at a higher rate. But post IPO they grow more slowly. Why? Culture fit has led to increased group think and does not prepare companies for change and disruption. Grant prefers Ideo’s philosophy of cultural contribution – looking for people who will “enrich and stretch” the existing culture.
According to Steven Matly, CEO/Founder at SM Diversity “We should be shifting our mindset to Cultural Addition – meaning adding to our current culture and values. This also promotes and encourages organizations to be intentional about getting outside of their immediate comfort zone.” Matly suggests that hiring outside of current culture is a way to limit bias, tribalism and groupthink. Finding and hiring the opposite of yes-men and women will help us embrace new ideas that may have been seen as counter culture or threatening to the existing group.
Culture is really about values, and it can be very difficult to disentangle the two. On a recent panel at Seattle Startup Week, Annie Rihn, VP Recruiting at Zillow Group described how Zillow is moving away from culture fit as part of the hiring conversation. Instead, they will focus on values alignment by training hiring managers to ask questions that focus specifically on how a candidate’s behavior maps to Zillow’s six values including Own It and Winning is Fun.
If you adopt Matly’s philosophy about culture add, and put it into practice by interviewing based on values and behavior, you’ll be able to enhance your culture while increasing diversity. It may take some extra time and discussions to translate your culture into specific values and behaviors. But once you’ve done that, you can look for culture fit, add, or enhancement in a way that is both unbiased and more productive. Yes, you need to figure out your values and what they look like in action, but as a growing company shouldn’t you be doing that anyway?
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