HBE001_fm_.qxd 10/02/2002 11:27 AM Page i Hiring and Keeping the Best People TEAMFLY Team-Fly® HBE001_fm_.qxd 10/02/2002 11:27 AM Page ii The Harvard Business Essentials Series The Harvard Business Essentials series is designed to provide comprehensive advice, personal coaching, background information, and guidance on the most relevant topics in business. Drawing on rich content from Harvard Business School Publishing and other sources, these concise guides are carefully crafted to provide a highly practical resource for readers with all levels of experience.To assure quality and accuracy, each volume is closely reviewed by a specialized content advisor from a world-class business school. Whether you are a new manager interested in expanding your skills or an experienced executive looking for a personal resource, these solution-oriented books offer reliable answers at your fingertips. Other books in the series: Finance Managing Change and Transition HBE001_fm_.qxd 10/02/2002 11:27 AM Page iii H A R VA R D B U S I N E S S E S S E N T I A L S Hiring and Keeping the Best People Harvard Business School Press | Boston, Massachusetts HBE001_fm_.qxd 10/02/2002 11:27 AM Page iv Copyright 2002 Harvard Business School Publishing Corporation All rights reserved Printed in the United States of America 06 05 04 03 02 5 4 3 2 1 No part of this publication may be reproduced, stored in or introduced into a retrieval system, or transmitted, in any form, or by any means (electronic, mechanical, photo-copying, recording, or otherwise), without the prior permission of the publisher. Requests for permission should be directed to permissions@hbsp.harvard.edu, or mailed to Permissions, Harvard Business School Publishing, 60 Harvard Way, Boston, Massachusetts 02163. Library of Congress Cataloging-in-Publication Data Harvard business essentials. Hiring and keeping the best people. p. cm.— (The harvard business essentials series) Includes bibliographical references and index. ISBN 1-57851-875-X (alk. paper) 1. Employee selection. 2. Employee retention. 3. Employee motivation. I. Title: Hiring and keeping the best people. II. Harvard Business School. III. Series. HF5549.5.S38 H37 2002 658.3'1—dc21 2002010627 The paper used in this publication meets the requirements of the American National Standard for Permanence of Paper for Publications and Documents in Libraries and Archives Z39.48–1992. HBE001_fm_.qxd 10/02/2002 11:27 AM Page v Contents Introduction xi 1 The Hiring Process 1 Attracting the Best People Defining Job Requirements 2 Recruiting Promising Candidates 7 Interviewing 10 Evaluating the Candidates 21 Making the Decision and Offer 25 Don’t Forget Process Improvement 28 Summing Up 29 2 Beyond the Hiring Basics 31 Details You Need to Know Online Recruiting 32 When to Use a Professional Recruiter 38 Case Interviewing 40 Hiring Based on Embedded Personal Interests 42 Hiring for Microculture 49 Psychological Testing 52 Summing Up 55 3 Keeping the Best 57 Essential Retention Strategies Why Retention Matters 60 Why Retention Is So Challenging 66 Master Page A HBE001_fm_.qxd 10/02/2002 11:27 AM Page vi vi Contents The Special Challenges of a Diverse Work Force 69 Why People Stay 75 Why People Leave 77 Two Retention Champions 79 Managing for Retention:An Overview 81 Summing Up 85 4 Market-Wise Retention 87 Competing in the War for Talent Not All Employees Have Equal Value 88 Market-Based Retention Strategies 92 Summing Up 99 5 Developing the Talent You Have 101 Strategies for Training and Development The Development Dilemma 103 Skill Training 104 Career Development 108 Handling C Performers 112 Summing Up 114 6 Workplace Factors That Affect Hiring and Retention 115 Focusing on Culture Consider Your Culture 116 Employee Burnout 119 Work-Life Balance 123 Summing Up 133 7 When All Else Fails 135 Keeping Talented Employees, Even After They Leave Keeping Valued People in Your Orbit 136 Hiring Former Employees 139 Exit Interviews 141 Summing Up 142 HBE001_fm_.qxd 10/02/2002 11:27 AM Page vii Contents

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