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Cracking the Hiring Code

June 1, 2004
Related Topics: Candidate Sourcing, Featured Article, Staffing Management

It seems like only yesterday that employers were relying on more gimmicks than P.T. Barnum to attract techies. The labor shortage was so severe that signing bonuses, stock options and high-end perks became de rigueur. Then the dot-com bomb hit, nuking the employment scene and leaving IT workers reeling. Many of these highly paid individuals soon found themselves trading greenbacks for pink slips.

    Now, with the economy on the uptick and the employment scene beginning to stabilize, companies are once again looking to attract and hire techies--though in a far more sensible way. One tool in their arsenal: coding competitions. Although colleges and universities have long held contests to recognize outstanding programmers, TopCoder Inc. has expanded the concept to the workplace. Already, the likes of Yahoo!, NVIDIA, Google, DoubleClick, Intel and Sun Microsystems have bitten.

Interviews are "not enough"
    Here’s how the concept works: TopCoder finds talented programmers, many of them from leading universities, to compete in contests that include first-place cash awards as large as $50,000 and overall purses that exceed $100,000.

    The contestants square off against one another and against the clock, advancing round by round into the finals. Along the way, TopCoder tracks results at its Web site, including names, points and rankings. Finally, TopCoder’s review board selects a winner. In most cases, a group of companies sponsor these events and participate together. Occasionally, a company chooses to sponsor its own private competition.

    "The idea was to develop a platform that could objectively analyze and rate the skills of software developers," says Rob Hughes, chief operating officer of three-year-old TopCoder, based in Glastonbury, Connecticut. "For companies, hiring programmers is a challenging proposition. It is difficult to identify people with the right skills and talent level through the traditional recruiting and hiring process. A résumé and an interview aren’t enough."

Non-traditional approach
    Companies shell out anywhere from $35,000 to $150,000 to participate in a coding contest (the higher figure applies to so-called "private label" events for a single company). In return, firms gain access to a pool of highly qualified potential employees. The approach also helps organizations improve their visibility and name cachet at universities as well as within tight-knit circles of software developers. As many as 1,000 individuals typically enter the contests, Hughes says. Sponsors can communicate with all entrants via e-mail, chat and instant messaging. This provides an opportunity to "educate" and "inform" them about the firm.

    One organization sold on the concept is Sunnyvale, California-based Yahoo! The Internet firm has participated in coding competitions for the last two years, and corralled both interns and employees there. "In a world where there are very few new ideas, it is a new idea," states Ken Perluss, talent acquisition director for Yahoo!

    Perluss finds it very appealing that he can validate and measure the programming skills of participants. Too often, he says, traditional approaches are hit or miss. "You ask someone to sit down in a conference room and solve a problem, and they don’t perform particularly well, perhaps because they are nervous." On the other hand, "some people interview well and perform well on a short test, but that doesn’t mean they are going to do well on the job." While interviews remain an important component, "the competition gives us a much better idea whether the person has the ability to do the job," he explains.

    Yahoo! became the title sponsor for TopCoder’s 2004 Collegiate Challenge, which involved nearly 1,000 participants worldwide and culminated with the final rounds in Boston. Participants solved complex algorithmic problems using Java, .NET, C++ or C#, and faced the task of designing or developing reusable software components. Ultimately, Yahoo! extended several job offers on the spot, Perluss says. The firm also is continuing to communicate with several other finalists and may extend offers at some point in the future.

Branding opportunity
    Another company that has benefited from these coding competitions is NVIDIA Corp. The Santa Clara, California, manufacturer of graphics and gaming chips has sponsored three competitions over the last several months. "It’s not only an excellent way to connect to the programming community," says Daniel Rohrer, manager of DirectX Graphics. "It is a very effective way to extend the brand name."

    Rohrer believes that coding competitions offer a cost-effective way to tweak the recruiting process. With the expense of hiring and training an employee somewhere in the neighborhood of $20,000 to $30,000, "it takes only a handful of people to make the entire proposition worthwhile." Rohrer is currently pursuing several code jockeys, including a hardware specialist who happened to be hanging around one of the competitions. "This is the wave of the future," he argues.

    Although coding competitions aren’t going to replace the traditional hiring process anytime soon, TopCoder’s Hughes believes that the concept has a great deal of potential for future growth. For one thing, students and professionals participating in the events enjoy them--and thoroughly love the opportunity to capture prizes and cash awards. For another, employers can zero in on their target labor pool and find ideal candidates without a lot of muss and fuss. In fact, Hughes now plans to expand TopCoder’s competitions to other areas within the information technology universe.

    Since TopCoder’s creation, it has attracted nearly 40,000 programmers from around the world. "Finding talent is an ongoing challenge for most companies, and the software-development field presents unique difficulties," Hughes explains. "The ability to give developers problems and see how their minds work is incredibly attractive. It eliminates many of the long-standing barriers to successful recruiting."

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