Report card for headhunters: can do better

By Selwyn Parker

Are you a "question mark", a "high flyer", a "peaked manager" or, heaven forbid, "a blockage"?

In the hotly-debated black art of talent-spotting managers, these are the four main categories according to Neville Bain, New Zealand-born chairman of the Post Office in Britain.

Judge for yourself:

* Question mark - somebody performing way below their potential, hence a bit of a puzzle, possibly lacking in motivation, not really your fault though because organisation has failed you.

* High flyer - star who performs right up to high potential, needs to be stretched to keep fired up.

* Peaked manager - gone about as far as you can go. Historical performance ranges between satisfactory and high but now moving sideways, may be approaching retirement. Most managers fit into this category. Big danger is that they end up in following group.

* Blockage - low-performer with low potential, has grim future. Should be "removed from their current role", firmly but kindly with due compensation for a job not very well done. "Managers who do not address this directly during an appraisal do the individual and their organisation an injustice," adds Mr Bain.

Merciless? Not according to Dunedin-born Mr Bain, who identifies these categories in his latest book, The People Advantage (Macmillan Business), co-authored with occupational psychologist Bill Mabey.

Throughout, Mr Bain is pre-occupied with what he calls in a memorable phrase "the beautiful complexity of matching people to jobs." And he's not particularly complimentary of the hit-and-miss methods of Britain's recruitment industry.

To the authors, it all seems very hit and miss. They argue that the identification of the potential of managers "is often random, subjective and judgemental." As the school report cards used to say: "Could do a lot better". In fact, if Mr Bain were evaluating some of the senior lights of the British recruitment industry, he would probably dismiss half of them as blockages.

He is certainly very dismissive of the vogue for using dubious new-age stuff in identifying talent. These include phrenology, which involves judging particular abilities by the size and shape of the skull - much favoured by Sherlock Holmes, astrology, palmistry, and graphology (the study of handwriting).

In Britain, right now, roughly half of new senior appointments turn out to be right for the task. "A 50-50 chance of being right with a potential œ1 million investment in a senior manager over, say, a five to eight-year period is hardly best practice," Mr Bain told a New Zealand audience in early April.

But get it right and there is brass in the beautiful complexity of dovetailing talent into jobs. The New Zealander, who is presiding over the transformation of the Post Office with its œ7 billion a year in turnover, is a great believer in ability tests that aim to identify individuals' special suitability for a particular job.

"With the right selection conditions, they could deliver 15 per cent or higher gains in productivity from those selected," he argues. "[They are] a defensible and cost-effective weapon in the assessment armoury."

Over a five to eight-year period, that adds up. A 15 per cent compounded return would turn that five to eight-year investment into between œ2 million and œ3 million, which is clearly worth having.

That's the gain from turning around the question marks, stretching the high flyers, keeping the peaked managers on the ball, and kissing goodbye to the blockages.

To do all this though, you have to get the execution of the tests right.

Take appraisals. According to Mr Bain, the appraisers are often inept.

Too often, they focus on making the next grade up in pay rather than on performance. "All but the very best organisations are pre-occupied with filling in the form instead of with building up skills," he summarises.

Take the identification of talent. Although it's obviously important to measure potential as well as performance, the assessment of potential is often 50 per cent guesswork.

The trouble with testing is that it has got a bad name. Although Mr Bain acknowledges there are good and bad tests out there, he insists it's not too difficult to find the good ones. As for some applicants being able to fake tests - a technique known as "impression management" in the trade (or lying), it's just about impossible with well-constructed ones.

Testing works well when it is done correctly. "In about 50 minutes it is possible to elicit around 400 pieces of personality-based information to cover the breadth of occupational personality."

You hear about so many mistakes in appointments at all levels that The People Advantage's more rigorous approach clearly has a lot to recommend it.