254 - Why Hiring For "Culture Fit" Might Be Holding You Back
When it’s time to hire new employees, many organizations seek candidates they believe will “fit” with their established “cultures.” The theory is that employees who better conform to the dominant corporate values will be more engaged and loyal — and thus more productive and less prone to leave their jobs.
Although hiring for culture fit makes a lot of sense, it can also hold an organization back, according to Jordan Birnbaum, vice president and chief behavioral economist at ADP.
Birnbaum said more experts now realize that culture can vary by department and that it’s difficult to tell what a person will be like as an employee after just a few interviews. In practice, culture fit can also create a homogeneous workforce, which can negatively affect business performance.
The Pitfalls Of Hiring For Fit
Organizations work hard to develop all-encompassing cultures, but there are times when values vary from department to department — to the benefit of the organization as a whole.
“The most common definition of a company’s culture is how things are done at the company,” Birnbaum said. “But if you’re in the accounting department, the culture is more likely to be risk averse and process-oriented, whereas if you’re in product development, you’ll be much more risk-tolerant and flexible.”
Another issue with culture-based hiring is that a person’s character doesn’t come through during the interview process.
Candidates are “on their best behavior during an interview,” Birnbaum said. “They don’t really start being themselves until they’ve worked in the job for a few months.”
But perhaps the biggest problem with hiring for culture fit is that it has become more about personal fit.
“Fit has gone rogue,” according to the author of a study by Northwestern University’s Kellogg School of Management. That study found that managers who had been instructed to hire for culture fit actually made picks based on their personal chemistries with job candidates. Shared experiences were big components in their eventual hiring decisions, whether those experiences involved hobbies, hometowns or similar life stories. Unsurprisingly, the demographic makeups of the hires were similar to those of the hiring managers.
Birnbaum has also seen culture fit work to keep people who are different out of organizations.
“Something like culture fit is so unquantifiable that it makes it extremely difficult to know what’s driving an evaluation — whether there are unconscious biases that are driving it,” he said. “We have such deeply rooted positive biases toward people like us that it’s almost impossible for us to realize what we’re doing. We just experience a sense that a person is terrific.”
Differences Are Key To Success
If hiring for culture fit means your business ends up with fewer employees who are different on the basis of race, class, sexual orientation, age, country of origin or gender, it could be hurting your business’s own bottom line.
“There’s a lot of research around this,” Birnbaum said. “Companies that are less diverse have less innovation. The more diverse that a group becomes, the better the long-term results for the organization happen to be.”
A 2009 study by the American Sociological Organization showed that companies with greater racial diversity had nearly 15 times more sales revenue than companies with less diversity. Multiple studies have also found that diversity leads to innovation. One study in particular found that companies with greater diversity are 45 percent more likely to see growth in market share and 70 percent more likely to penetrate new markets. Companies with at least one woman on their board outperform other companies by 26 percent. Companies with more women in management also perform better.
In fact, it seems as if culture difference rather than culture fit is the driver of business success and innovation. A Harvard Business Review article looked at a wide swath of research on the subject, concluding that the differing perspectives inherent in diverse teams allow for re-examination of assumptions and better insights.
Hiring Best Practices
Silicon Valley companies such as Facebook, Pandora and IDEO are leading the charge away from culture fit, adopting hiring practices that incorporate bias training and focus on maximizing diversity.
In fact, Pandora has flipped the concept of culture fit on its head and started hiring for “culture add” instead. The company specifically looks to hire employees from demographics and backgrounds unlike those embodied by its current employees. Similarly, IDEO now hires for “cultural contribution,” or how a new hire’s perspective could help make a positive shift in the organization’s culture.
These are much better hiring strategies, according to Birnbaum, who also recommends employing blind resumes, bias training and structured interviews to ensure that hiring practices aren’t unconsciously discriminatory.
“Often the interviewer decides within the first three seconds of the applicant’s walking into the room whether or not they like that person, and spends the remainder of the time engaging in an exercise of confirmation bias,” said Birnbaum. Structured interviews, he said, prevent that, ensuring that each candidate receives “the exact same experience.”
Culture Fit Has Its Place
Although Birnbaum believes hiring for subject matter expertise or to add diversity is a better strategy, he recognizes that many organizations are attached to the idea of culture fit.
He recommends that those organizations identify the shared cultural values that they’re seeking before the interview process starts. Then they should determine what questions they can ask to best evaluate whether or not the job candidate meets the criteria.
“That way, it’s harder for a hiring manager to be subjective,” he said.