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No. Many companies have hiring rate of 10% [1] which means hiring 1 candidate may cost you 10 person-days assuming full day interviews for each candidate [2]. Y

by sytelus 12y ago

No. Many companies have hiring rate of 10% [1] which means hiring 1 candidate may cost you 10 person-days assuming full day interviews for each candidate [2]. You can probably double that to cover the cost of phone screens, so let's say 20-person day of work per good hire. Assume you had 4 false negatives just because you are so aggressive and so a good hire ended up costing you 100 person days instead. This cost is still tiny compared to damages that a true negative would cause otherwise, i.e., (1) loss of entire person year or even two because annual reviews need to accumulate evidence for HR to fire (may be less time if you were startup without real "HR") (2) amount of cleanup other people have to do after that new bad hire (3) loss in moral for good people in your team who now perceives your hiring process at the company as "broken" (4) delays + bugs introduced in product because actual work probably didn't got done or badly done despite of you filling up your headcount (5) amount of money lost in salaries, signing bonuses, office space and benefits (typically > $200K) (6) amount of productivity lost because of wasted time by good people in the team trying to "ramp up" your true negative (7) emotional stress you caused to good people wondering them about their job stability and to managers who wasted their time in months of paper work and lot of explaining (8) emotional stress you caused to your true negative being fired who had moved across the country for you, bought a house on mortgage and had 3 school going children (9) Most likely, if you are big company, true negative didn't actually got fired because hiring manager never wanted to admit it. S/he was encouraged to join another team or role or even learned political tricks to get promoted contributing to ongoing bozo explosion[3] (10) I could go on and easily justify probably 3X-10X loss compared the case if true negative was avoided Footnotes: 1 - Many companies specify their hiring rate over total resume they received which is wrong. I'll use 10% as total number of full interviews that needed to be conducted which is average of 5%-15% at most companies. 2 - This is bad math. Assuming random trials, it would be actually 5 person-day on average but intuitive approach doesn't produce entirely bad results here so we will go with that. 3 - http://guykawasaki.com/how_to_prevent_/ http://guykawasaki.com/how_to_prevent_/

fsk 12y ago
Hiring rate of 10%? You mean you hire 10% of all people who submit a resume? Or 10% of all people who come in for an on-site interview? Those are two different things. Why should it take 2 years to fire someone? That sounds like a corporate bureaucracy problem.
- sytelus 12y ago
  10% of total number of full interviews that needed to be conducted. At most publicly listed companies, firing can't be done without accumulation of enough evidence (what HR usually refers to as "paper trail"). This is true even when employment was "at will" mainly because of legal liability (for example, fired employee can claim that he was a victim of XYZ) and bad PR it can generate. I think Facebook is (or was) probably rare exception in aggressive firing and not sure how they managed it. Most companies also require annual review to be in place before firing occurs. Typically hiring manager would avoid firing within first year because that usually looks very bad on them. Most true negatives don't get fired until hiring manager changes or years pass by. At startups things are obviously different. Resources are scarce and true negative probably won't survive beyond 6 month or in worse case beyond a year. But still that's a significant period to cause enough of hemorrhaging for a true negative.
itsdrewmiller 12y ago
You didn't actually respond to his comment. Assuming, for example, you have: * 99% of applicants are bad * 50% false negative (You look over about one good developer for every good developer you hire) * 1% false positive (one out of a hundred bad devs can snooker you into hiring) In that scenario, you're twice as likely to hire a bad dev as a good one. And if you halve your false positive rate by increasing your false negative rate by 50%, you're still twice as likely to hire a bad dev, it will just take you twice as much work.
- fsk 12y ago
  I see what you're saying. I was pointing out the dangers of false negatives, but he responded that he hires 10% of the people he invites for an onsite interview. Even if you hire 10% of the candidates you on-site interview, that says nothing about your actual false positive or false negative rate. For all I know, he could be weeding out all the top candidates at the pre-interivew stage, and then hiring the best of a mediocre group of people. It's easy to measure your false positive rate, people you are forced to fire (or wish you could fire if not for corporate bureaucracy). It's harder to measure your false negative rate. The only way you could measure your false negative rate is to pick a random sample of people who fail your interview, AND HIRE THEM ANYWAY. (However, that could be a lawsuit risk. It would be unfair to the people who hire despite failing the interview. A small business couldn't afford to do it, only some huge corporation could do the experiment.) Also, I doubt the ability of most businesses to identify the best performers AFTER THEY ARE HIRED and working there for a couple of years.
  - sytelus 12y ago
    No, I did not say I hire 10% of candidates I interview :). What I said was that's a fair estimate in industry. I feel you are truly confused about FP and FN. Whether there are 99% bad developers out there or if you hire 10% of candidates you interview - these both quantities are independent of FN and FP. FN says that you are turning away X good people and it's again independent of FP which ultimately decides how many bad developers you would eventually end up hiring regardless of other 3 quantities I mentioned. See here: http://en.wikipedia.org/wiki/Confusion_matrix http://en.wikipedia.org/wiki/Confusion_matrix It's not easy to measure FN, FP, TN or TP. Even good people fail due to different reasons like bad manager and bad people may succeed despite of mediocre skills. Looking at who you had to fire or who got promoted doesn't give accurate measurements at all although they may serve as weak proxy. The scenario I described was hypothetical to point out that cost of FP is far more higher than additional cost in hiring due to FN.

by sytelus 12y ago

fsk 12y ago

Hiring rate of 10%? You mean you hire 10% of all people who submit a resume? Or 10% of all people who come in for an on-site interview? Those are two different things. Why should it take 2 years to fire someone? That sounds like a corporate bureaucracy problem.

sytelus 12y ago
10% of total number of full interviews that needed to be conducted. At most publicly listed companies, firing can't be done without accumulation of enough evidence (what HR usually refers to as "paper trail"). This is true even when employment was "at will" mainly because of legal liability (for example, fired employee can claim that he was a victim of XYZ) and bad PR it can generate. I think Facebook is (or was) probably rare exception in aggressive firing and not sure how they managed it. Most companies also require annual review to be in place before firing occurs. Typically hiring manager would avoid firing within first year because that usually looks very bad on them. Most true negatives don't get fired until hiring manager changes or years pass by. At startups things are obviously different. Resources are scarce and true negative probably won't survive beyond 6 month or in worse case beyond a year. But still that's a significant period to cause enough of hemorrhaging for a true negative.

itsdrewmiller 12y ago

You didn't actually respond to his comment. Assuming, for example, you have: * 99% of applicants are bad * 50% false negative (You look over about one good developer for every good developer you hire) * 1% false positive (one out of a hundred bad devs can snooker you into hiring) In that scenario, you're twice as likely to hire a bad dev as a good one. And if you halve your false positive rate by increasing your false negative rate by 50%, you're still twice as likely to hire a bad dev, it will just take you twice as much work.

fsk 12y ago
I see what you're saying. I was pointing out the dangers of false negatives, but he responded that he hires 10% of the people he invites for an onsite interview. Even if you hire 10% of the candidates you on-site interview, that says nothing about your actual false positive or false negative rate. For all I know, he could be weeding out all the top candidates at the pre-interivew stage, and then hiring the best of a mediocre group of people. It's easy to measure your false positive rate, people you are forced to fire (or wish you could fire if not for corporate bureaucracy). It's harder to measure your false negative rate. The only way you could measure your false negative rate is to pick a random sample of people who fail your interview, AND HIRE THEM ANYWAY. (However, that could be a lawsuit risk. It would be unfair to the people who hire despite failing the interview. A small business couldn't afford to do it, only some huge corporation could do the experiment.) Also, I doubt the ability of most businesses to identify the best performers AFTER THEY ARE HIRED and working there for a couple of years.
- sytelus 12y ago
  No, I did not say I hire 10% of candidates I interview :). What I said was that's a fair estimate in industry. I feel you are truly confused about FP and FN. Whether there are 99% bad developers out there or if you hire 10% of candidates you interview - these both quantities are independent of FN and FP. FN says that you are turning away X good people and it's again independent of FP which ultimately decides how many bad developers you would eventually end up hiring regardless of other 3 quantities I mentioned. See here: http://en.wikipedia.org/wiki/Confusion_matrix http://en.wikipedia.org/wiki/Confusion_matrix It's not easy to measure FN, FP, TN or TP. Even good people fail due to different reasons like bad manager and bad people may succeed despite of mediocre skills. Looking at who you had to fire or who got promoted doesn't give accurate measurements at all although they may serve as weak proxy. The scenario I described was hypothetical to point out that cost of FP is far more higher than additional cost in hiring due to FN.