Making The Case For Experience
Editor’s Note: This was the feature article in this month’s TechCom Manager newsletter, reprinted here with permission. Click the previous link to subscribe to the newsletter.
Jobs, jobs, jobs! The headlines are everywhere and seem to be the core topic on everyone’s mind. If you are a manger who is lucky enough to add to your staff, you may feel like a pageant winner right about now. Once the celebrating subsides, you are left with a tough decision to make. Exactly what kind of employee are you looking to hire?
There are certain characteristics inherent to every candidate search, but none is more influential than total cost versus overall experience ratio. You may be thinking that now is the time to get a great deal on valuable talent. In many instances, you may be right. But ask yourself this: Has the job market really become a mirror image of the current housing market? Are there some great MBA candidates and stellar employees available at a reduced salary band? Yes and no. All things being relative, you will still have to weigh your options according to your needs and take a leap of faith. However, there are some surprising data points emerging from our current economic conditions as well as a few key ideas to consider before you begin searching for your next team member.
Emerging Human Resource Trends
A quick scan of job postings can reveal a very interesting common theme among companies looking to hire. Many have increased the level of detail in their requirements down to specifics beyond what had been seen before. Is this an effort toward an improved candidate screening process, or are companies looking to hire an exact replica of an employee they once had? Staffing-firm guidance suggests the latter case may indeed be the reason such complex parings of skills are being expected these days.
Consultants like Booz & Co have touted savings of nearly 20% or more in salary costs that can be achieved through better pay alignment with the actual job performed by each employee. In their May, 2011 post, Retooling Labor Costs, Booz & Co consultants, Harry Hawkes, Albert Kent, and Vikas Bhalla echo an idea that had been circulating for almost a decade – wage disparities are the result of employee loyalty and that moving to a salary range per job classification can realign wages into manageable ranges.
“Workers with many years of service have seen their wages grow in a steady trajectory year after year, fueled by adjustments for inflation as well as annual merit raises that often surpass the rate of inflation, without any increase in responsibilities or required skills. In this environment, the gap between high wages and market value must be narrowed, if not closed.”
US Labor statistics show that consultants may be getting through loud and clear to employers desperate to cut costs while retaining enough employees to weather the storm. The number of displaced workers classified with over three years of tenure peaked between January 2007 to December 2009 at 6.9 million workers, with only half reporting re-employment at some level within six months. What is notable is that the highest rate of rehire for this group fell within the 22-54 age group (55% and 53%, respectfully), while employees over age 54 saw rehire rates at 39% or less.
So what happened to those 15- or 20-year employees who consultants suggest are overpaid for their job role? Is it possible the consultants overlooked experience and institutional knowledge in favor for the bottom line? The Booz & Co post recommends, “… a retraining program for valuable workers… [where they] could be trained to do jobs that better match their salaries.” This is an unlikely scenario in the midst of this economic crisis and, in fact, many of these valuable and experienced employees have found themselves among those displaced.
MBA Credentials – The Holy Grail?
Basic requirements for potential candidates have become increasingly demanding. In years past, an undergraduate degree was a sufficient academic credential for educational training. Today, advanced degree requirements are the norm and many students are extending their academic plans to incorporate a post-graduate degree program into their plans. Even transfer opportunities within corporations increasingly demand post-graduate degrees for employees whose performance and value is already a known factor.
It is widely believed that a post-graduate program is both highly beneficial for prospective candidates as well as provides a mark of value to the employer. That presumption may not always be an accurate assessment. Mark Shead, an entrepreneur and blogger at Productivity 501, advises hiring managers against a myopic focus on the MBA. In his post, Never Hire an MBA, Mark cautions employers to avoid MBA candidates without a wealth of experience, “…One of the drawbacks of many MBAs is that they often over-estimate their skill set.” He goes on to point out that experience in the workforce can be the difference between a great employee and just a good one, “While most MBA programs offer good content, simply being exposed to a lot of great ideas doesn’t say much about your ability to implement those ideas in real life.”
Two writers from the Academy of Management Learning & Education, Jeffrey Pfeffer and Christina Fong, both Stanford professors and post-graduate degree holders themselves, explored the value of MBA studies and detailed their findings in a 2002 report called, “The End of Business Schools? Less Success Than Meets the Eye.” They reviewed data that qualified MBA graduates against the total impact of their education on their workplace performance, reviewed the impact of overall GPA as an indicator of successful work performance and the contribution of the schools themselves on real-world business methods. Their findings are startling and allude to the MBA-alone benchmark as being a poor value for an employer struggling to keep wage margins in line, even if the MBA candidate holds a post-graduate degree from a prestigious university. They discovered that the post-graduate degree was not a good indicator of performance and, in many cases, it was demonstrated that those candidates without significant experience actually showed a fundamental lack of business acumen compared to experienced professionals with only an undergraduate degree.
“What matters are the personal attributes of the attendees not what they learn while in attendance, [this] is consistent with the fact that the course of study, and even the textbooks used, are remarkably similar across schools of different degrees of selectivity, so it is hard to argue that there are important differences in the knowledge being provided in the different schools. Studies conducted by the Educational Testing Services in 1982, as well as Porter and McKibbin’s (1988) investigations of curriculum across business schools have emphasized that the curriculum is quite similar across schools.”
Their findings echo what one staffing professional at a global Fortune 500 company recently admitted to me, “What I am looking for is experience with managing people, experience in managing complex projects and proven results. I want to know how they have handled certain situations as an indicator to how they will perform. I’ve had plenty of doctorate- degreed managers decline PHD candidates because they are just too difficult to manage. Even with an MBA, I have to see the experience.”
Experience as a Value Proposition
Early on in my career, I learned a startling lesson on the value of experience. I had accepted a position at a small, but promising company and was surprised to learn the president of this multi-million dollar investment firm was a smart and highly confident 26 year-old MBA graduate with very little practical experience. I worked with many other highly motivated, but inexperienced professionals at this company for almost a year before a massive layoff came and the company moved abruptly out of state. Within one year of the move, that same young executive and the owner were indicted on fraud charges and both were sentenced to serve time in federal prison. While my experience is certainly not typical, it did have a profound impression on me.
Even today, I am often approached with projects that involve correcting the mistakes made by larger design firms who have elected to hire post-graduate degreed professionals with limited experience or very low-cost designers with no experience. These mistakes can prove very costly to a company when the project budget becomes consumed by repeated editing tasks and loss of critical time. As a manager, you cannot afford to be measured by less than stellar project performance and budget overrun issues – each of which can become severely career-limiting factors.
Consider the skills of your candidates carefully compared to a clear demonstration of their personal attributes. While the job market does lend itself to salary adjustments within specific industries, the staggering cost of continual turnover must be considered in any hiring decision. HR professionals know that young MBA candidates with little experience tend to move on very quickly. Leigh Branham, author of, The 7 Hidden Reasons Employees Leave, (AMACOM, 2005) writes, “…an overwhelming three-fourths of the workforce is disengaged” which is the core reason they choose to leave. An MBA with little work experience may not have the same understanding of their role and your expectations as someone who, during the interview process, easily recognizes what your needs are.
As you begin compiling your candidate requirements to find that perfect employee, consider the value inherent in experience and don’t immediately rule out the older, more seasoned professional. One benefit to the current job market may be an opportunity to engage a highly knowledgeable veteran with a keen eye for detail, commitment to accuracy, and a desire to take pride in their work. This pool of prospects may also have a more expansive career from which they can draw upon in tough situations and offer a perspective time-tested for success. Above all, when you are ready to begin a search for new talent, consider omitting just one single phrase, >em>”MBA required.” A single change like this can open the door a little wider.
About the Author
Kerri Barber is a freelance Interactive Communications Specialist and Marketing Consultant working in the Chicago area. Kerri has served as a key member of the Public Relations and Communications team at such Fortune 500 companies as NCR Corporations in Duluth, GA and Baxter Healthcare Corporation in Deerfield, IL. Her clients span the globe and range from midsize businesses looking to gain a greater market share to large companies seeking to better communicate and engage diverse teams. Kerri also coordinates and conducts training programs to improve client services, conflict resolution, and process-improvement techniques. Kerri has completed studies in Phi Theta Kappa’s Leadership Development with Ohio Senator Tom Roberts, and has served as Communication Chair of the Professional Resource Council in Dayton, OH. Currently, she serves on the Board of Directors for a non-profit children’s advocacy group and is a member of her parish Communications Committee assisting with digital communication and Web engagement for the home-bound.