In his best selling book, Daniel Kahneman creates the framework for his insights by defining the two “systems” of human reasoning that are employed to make decisions and judgments:
System 1 is sometimes referred to as intuition. It is fast and automatic and is usually associated with strong emotional bonds. It is based on formed habits and is very difficult to change or manipulate.
System 2 is sometimes referred to as reasoning. It is slower and much more volatile, being subject to conscious judgments and attitudes.
These framework definitions are a simple way of explaining how a judgments can occur in two different ways. In psychology, this is called a duel process theory. Obviously, I’m grossly over-simplifying these concepts. There is much to read on this topic if you care to learn more.
For our discussion, the following chart may be helpful in understanding the concept of System 1 and System 2:
So, here’s a question:
When it comes to making judgments in the recruiting process, is System 1 or System 2 more reliable?
Before you put too much thought into this question, I’ll share a quick story that contributed to some of Kahneman’s research. Early in his career, Kahneman and his research partner, Amos Tversky, discovered they both had identical silly ideas about the future professions of several toddlers they both knew.
“We could identify the argumentative three-year-old lawyer, the nerdy professor, the empathetic and mildly intrusive psychotherapist. Or course, these predictions were absurd, but we still found them appealing.
It was also clear that our intuitions were governed by the resemblance of each child to the cultural stereotype of a profession. The amusing exercise helped us develop a theory that was emerging in our minds at the time, about the role of resemblance in predictions. We went on to test and elaborate that theory in dozens of experiments.”
In simple terms, these gentlemen were employing System 1 to draw conclusions about a person’s fit for a particular profession. If a human’s mind is susceptible to quickly draw conclusions under these ridiculous circumstances, could it also draw wrong conclusions during a more traditional recruiting encounter?
Here is another example to consider. Let’s assume that Steve is selected at random from a representative sample:
“An individual has been described by a neighbor as follows: ‘Steve is very shy and withdrawn, invariably helpful but with little interest in people or in the world of reality. A meek and tidy soul, he has a need for order and structure and a passion for detail.’
Is Steve more likely a librarian or a farmer?
The resemblance of Steve’s personality to that of a stereotypical librarian strikes everyone immediately, but equally relevant statistical considerations are almost always ignored.
Did it occur to you that there are more than 20 male farmers for each male librarian in the United States? Because there are so many more farmers, it almost certain that more ‘meek and tidy’ souls will be found on tractors than at library information desks.”
During multiple research studies, Kahneman found that participants ignored the relevant statistical facts and relied exclusively on resemblance. More specifically, the experiments demonstrated that humans tend to use resemblance to construct mental “rules of thumb.” Once developed, they rely on these mental rules to make difficult judgments—even to the point where it defies reason and causes predictable biases (systematic errors) in their predictions.
Conclusion: I think we'd all agree--systematic errors in hiring are a bad thing. Relying on intuition causes us to hire people we shouldn’t and overlook potential high performers. According to Kahneman, System 1 reigns supreme when making hiring decisions. By the way--if you think you’re exempt from this type of reasoning, you’re mistaken. It affects everyone who evaluates candidates and conducts interviews.*
How do you keep from getting stuck in an endless cycle of systematic errors?
First, recognize what is happening and make a conscious attempt to resist being controlled by your mind’s System 1. Second, learn how to employ System 2.
In our company, we use assessment tools to help us overcome the System 1 dominance. These tools do help, but it is also important to structure interviews so that you’re collecting data and not just allowing your System 2 to lazily disengage.
This means asking lots of open-ended questions, formulating thoughtful follow-up questions, listening, taking notes, drawing trial conclusions from your candidate’s answers, asking the candidate to defend their positions, etc.
We’ll cover more on this topic in future discussions, but for now, work to stay mentally sharp and engaged during your interviews. It will take more effort, but you’ll make better hires.
*Note: After
evaluating the financials of many real estate companies over the last seven
years, I’ve noticed that most companies have 40% to 60% “D” performers in their
ranks at any point in time. Considering
that many “D” performers leave the organization soon after they’re hired, most
companies have a very poor track record at selecting high performers.
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Editor's Note: This article was written by Ben Hess. Ben is the Founding Partner and Managing Director of Tidemark, Inc. and a regular contributor to WorkPuzzle.
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