Should AI Run HR?
A paper called “Hiring, Algorithms, and Choice” crossed my desk recently, and I found it interesting enough to pass along to Kelie (our Director of Talent Acquisition) and Mark (our COO who also has strong opinions about people). The paper asks very fairly “Why do organizations still conduct job interviews?”
The basis for the question is that people are bad at predicting future performance and fit and that algorithms and AI are better at it and also more efficient. Given that, why aren’t organizations turning over their hiring processes to technology? Now, many have to some degree, and even though we’re not running a business that employs thousands of people or more, even Kelie utilizes automated tools to do screening.
Yet interviews persist. Is there a good reason or is it just theater?
One thing that’s true about Permanent Equity is that we’ve never regretted having dinner with anyone. Even if we show up without an agenda and unsure of our purpose, breaking bread is never without benefit. You build trust, rapport, and loyalty and probably have some fun, which ideally is what happens on both sides of an interview, as Kelie pointed out to me.
To put that in the language of transactions, these experiences generate credits in the relationship bank, credits that are hugely valuable when times get tough and hard decisions have to be made.
The authors of the aforementioned paper reach a similar conclusion about interviews, citing the work of American philosopher T.M. Scanlon. By bringing other employees into the choice of who to hire through the interview process, it validates those employees and also likely makes the hire more successful than it otherwise would be (given equal measurable “fit”) since everyone who was involved in the choice has an interest in seeing their choice validated.
If this is true, then hiring is not an objective process, but rather a cultural one in which the means may be as important as the end. Thinking that through kind of blew my mind and reframed the entire hiring process for me. Maybe there is more to it than filling the role with the most qualified person as quickly as possible.
And if that’s the case then the two rules of culture apply (1) Decentralize it and (2) Promote from within. Or as they may pertain to hiring: (1) Let teams hire their own and (2) Only hire externally for entry level roles.
I might have ended this piece right there, but as Mark pointed out to me, there is more nuance to hiring than that. “If you only hire leadership from inside, your organization’s self-awareness and innovation can stagnate,” he says. “As with most things, it’s a balance.”
He’s right, of course. After all, I wouldn’t be here at Permanent Equity if Brent had only promoted from within.
– By Tim Hanson