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Hallmark’s Quality-of-hire Initiative

May 10, 2005
Related Topics: Candidate Sourcing, Performance Appraisals, Featured Article, Staffing Management
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Every year, Hallmark Cards adds hundreds of employees to a payroll that already includes 4,500 individuals in the Kansas City headquarters and 13,500 more around the globe. Two years ago, the human resources division went looking for a tool that could help it measure its success in recruiting.

    a staffing index. The result: For the first time, Hallmark has a measurement solely devoted to determining whether new hires are measuring up to expectations.

    "The index helps us to focus our staffing organization on what is relevant to our company," says Tim Moran, human resources director for the corporate division of Hallmark, which has more than 50 percent of the U.S. greeting card market and generated consolidated net revenue of $4.4 billion last year.

Walking on water?
    Upon being hired, an applicant is scored on a metric called "initial candidate quality." The assessment is made by the line manager under whom the new employee will work and takes into account two factors--the manager’s assessment of the employee’s intrinsic abilities and the new employee’s relative desirability compared to the quality of the applicant pool from which she was hired. Moran says that the ratings a candidate may receive include:

1. Average

2. Above average

3. Good

4. Very good

5. Walk-on-water good

    Six months after starting work, applicants receive a competency evaluation on the same five-point scale so that the recruiting team can see whether the managers’ initial expectations have been realized. Performance ratings from an employee’s first and second annual reviews are also tracked in judging the enduring quality of a recent hire.

    "As a recruiting team, this keeps us tied to and concerned with the performance of our candidates, not just in their first 90 days and six months, but during their critical first two years on the job," says Patty Sullivan, Hallmark staffing manager.

    Data from the first annual review fell a bit below expectations, but Moran and Sullivan believe that Hallmark’s corporate culture skews the data somewhat by discouraging overenthusiastic first-year reviews. The recruiting department believes data from the second-year assessments should give a truer picture of the company’s satisfaction with its new hires.

Avoiding quicksand
    Hallmark got its staffing index off the ground using just Access and Excel. Now as the company transitions to new human resources technology including an application tracking system, the goal is to integrate the existing Access database into the new human resources system in a way that lets the recruiters compare candidates who consistently get top ratings against those who receive merely average rankings. "We want to learn what distinguishes them," Sullivan says. "It is incumbent upon us to learn from our hiring managers who observe these employees day to day what distinguishes top performers from average performers and then screen for and source against those criteria."

    Moran warns that getting too caught up in the subjective nature of the assessments can become a major obstacle to ever implementing a recruitment index. His team did a lot of research before implementing its staffing index, "and our take was that a lot of folks had given up on quality of hire or were using crazy formulas that you had to have a (specialized) background to understand," he explains. "A lot of people get into quicksand over how to measure quality. They get into a lot of conceptual, theoretical discussions. We decided just to figure something out and move forward."

    That’s a smart move, according to Joseph Cabral, chief human resources officer at N. Shore-LI Jewish Health System. "Keep it simple is my motto," he says. "You can drive yourself crazy deciding what you need to measure. You need to decide which metrics are meaningful to you as an organization. Capturing data just for the sake of capturing it is not going to give you what you want." Hallmark is mainly concerned about two metrics: quality and timeliness.

    Lonnie Pacelli, an independent consultant and author of The Project Management Advisor, ran the college recruiting initiative for Microsoft’s finance and administration departments. He says that when coming up with recruiting metrics, "the simpler the better."

    "Don’t try to have all these crazy models that no one can explain or understand," Pacelli says. "You don’t want analysis of the measurements to become a big project in and of itself."

    Nor do you want the numbers to get in the way of the ultimate goal--efficiently hiring the best employees that match the organization’s needs and priorities. "You have to be careful not to get too wrapped in the numbers," Pacelli says. "I’ve seen it happen where people shoot for a metric at the expense of quality. For example, if a recruiting organization becomes responsible for generating X number of resumes for a hiring manager’s review, the whole process can become a numbers game."

    Indeed, Moran and Sullivan say their staffing index is not an end in itself, but a means to an end. They know that their success as recruiters will ultimately be gauged not by the metrics in their database, but by the organization’s performance. "If you hire great people, they will perform great," Sullivan says. "When all the dust settles, that’s the most important thing."

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