Why hiring is paradoxically harder in a downturn

Noise goes up but the quality stays the same

Hiring is always hard.  The hardest thing to do at a company is the recruiting and hiring.  It was really hard when the economy was doing well.  Paradoxically, for certain industries (especially those reliant on innovation such as those in the tech space), it's even harder when times are tough.

That's right … hiring in tough economic times can actually be much harder than when times are good.   In a downturn, the amount of resumes from C-Players massively increases while the amount of resumes from A-Players probably remains the same. 

Never settle

First, let's assume you've already bought into the "When Good Isn’t Good Enough" philosophy of always trying to hire A-players because they are just so much more productive than B-players (an 'A-Player' by definition is incredibly productive and smart and  has that 'it', that rockstar-esque factor that makes everyone want to work with her).  That means you won’t settle for people who are good but instead hold out for people that are great.

Great people – the A-Players – are a very different breed from the good (B-Players) and mediocre (C-Players).  Great people are more likely to be employed with a company since a great person is often over 3 times as productive as a good person.  Joel Spolsky argues in Smart & Gets Things Done that an A-player is anywhere from 5-10 times as productive. Joel looked at coursework data from a Yale computer science class and found that the fastest students finished their workload as much as ten times faster than the slowest students (average was 3-4 times faster).

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Spolsky, Joel. Smart & Get Things Done. Berkeley, CA: Apress, 2007. p 6.

The (Un)Employed A-Player

In troubled economic times, anyone can get laid off, but a disproportionate number of layoffs tend to fall on C-players.  This is because they are the lowest performing people in a company and there generally are more C-players at a company than any other caliber.  Note that this isn’t always true, as evidenced with Yahoo!, a company that has recently experienced many layoffs but doesn’t have many C-players.  In Yahoo!’s case, majority of the lay-offs fell on B-players and even some A-players.  Yahoo! is an exception and is an exceptional company — most large companies, however, are chock-full of C-players.

A smart company would (or should) never lay off a great person unless her/his job function is eliminated.  For instance, if a smart company had to lay off one of two software engineers with one being great and other being good, it will very likely lay off the good engineer and retain the great one (and might even give the great person a raise).  Again, this is the logic that smart companies should follow.  Then again, there are many dim-witted companies that lay off their great people for odd reasons and so you’ll find some great people out of those laid off.       

Where to find that A-player

Some A-players are less likely to be looking to jump ship during tough times due to a risk adverse profile, security, financial reasons, or other reasons.  They are happy where they are and more likely to hunker-down in tough times.  On the flipside there are A-players that are MORE likely to leave.  Tough times often paint companies into a corner and force them into maintenance mode rather than continuing to innovate.  Great players love to innovate and usually NEED to innovate.  It’s usually very hard to keep these type of A-players caged-up and thus this presents a big opportunity for recruiting.

For instance, in the past it was really hard to hire great software engineers out of financial behemoths like Goldman Sachs, Morgan Stanley, and JP Morgan Chase.  These companies have outstanding people and pay these people really well (often 50% above the salary at a tech company).  Nowadays, even if these people have not been laid off, the great people are going to be leaving in droves.  Why?  Because in the next two years, it is really doubtful they will be doing anything remotely innovative.  Instead they will be maintaining current systems due to the understaffed and underfunded technology departments.  No fun there so expect a big exodus out of these companies.

It’s also worth noting that great people are often first to leave sinking ships.  They don’t feel they need to stick around for a severance because they are confident they can always get another job.

How to deal with the paradox

Let’s face it, these great, A-Player type people are just really hard to find.  Let’s say for sake of argument that A-players make up 1% of the population that could do the job, B-players are 19%, and C-players comprise the other 80%.  It’s uncertain if these percentages are accurate, but there definitely are more C-Players than B-players and more B-players than A-players.  Now if people find out you are hiring (through a Craigslist ad, posted on careers page, etc.), it probably means you are going to get a massive influx of resumes from C-players.  Many of these resumes will be indistinguishable from those of A-players (it’s always hard to distinguish on paper).  Which means the amount of noise (aka undesirable hires) will likely increase.  Which means more work sifting through these resumes and talking to many more people.  

It’s important to screen for great people in order to turn the volume down on all the noise.

Unfortunately, it is really hard to tell the difference between an A-player, B-player, or C-player just from a resume.  Which means you need to engage with candidates and therefore you’ll have far more candidates to deal with given this economic climate.  My guess – for a standard job announcement, you’ll have three times the number of C-players applying, twice the number of B-players, and the same number of A-players.   Wow…your noise level has just massively increased!

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At Rapleaf for instance, we have a written one-hour technical interview as the first screen for resumes we like.  Last year, our pass-rate for the test was 17% … meaning 17% of the candidates passed the written interview and moved on to a second round (a live chat with a Rapleaf engineer).  Today our pass rate is about 6-8%.  Our noise level has really increased.

One way to decrease the noise level (and thereby increase the amount of quality) is to specifically target candidates rather than to post a job ad.  I would suggest targeting a company you think has great people, call into that company, and try convincing the talent to meet with you.  I know if I was based in Manhattan and was recruiting software engineers, I’d be calling on the people in the top banks.  While not everyone at a top bank is a great player, your ratio of great-to-good is going to go up substantially (assuming they haven’t already left). 

Of course, not every position is harder to hire in this downtown.  It is easier to find great people whose industries have been totally decimated by this recession.  You're in luck if you are looking to hire investment bankers, corporate lawyers, construction workers, or people in manufacturing.

This downturn looks to affect us all for the next couple years, so be sure to fill your company with only A-players and thereby creating your own A-Team.

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Special thanks to Vivek Sodera for his help and edits.

81 thoughts on “Why hiring is paradoxically harder in a downturn

  1. Patricia

    Wait a minute, just hold on to all those biases for another minute. Since you are hypothetically saying 80% of the workforce are C-Players then why is there still middle management? Why is it when I went to a recent networking event I supposedly met one of your A-Players who was so over the top and specific to the job he wanted it was completely evident he would never get said job even as an A-Player because of his age ( 45+ ).
    Also, take an account of your situation, at the end of your post you credit highly another person, are you practicing what you preach or just spouting the stats because they look fun.
    I would also add that there can be cross over an A-Player could very well be an C-Player in a different position. Where an C-Player given guidance and encouragement could become the A-Player.
    The stats look nice but, reveal something else…plain bias. A-Player have to match a criteria that probably less than 1% of the population could meet.
    I guess that is why cloning is so popular….

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  2. Michelle

    Great post Auren! I could not agree more. It is like saying your odds are going to go up the more times you flip a coin. I have to say though it is funny looking at “B” and “C” players out of work “transforming” themselves into A players on paper.

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  3. JR

    Patricia,
    I do understand the age bias (45+), but those of us that have reached that magical age and beyond still have a great deal to offer in terms of experience and a desire to see an organization and ourselves succeed, so please do not put us out to pasture yet!
    I do agree with the articles premise, as I am hiring and having to sift through a great deal of noise. I also agree with you – C can be turned into A’s with the right guidance and encouragement – something frankly many of us do not have time to do, given more work and less staff. I am looking for A-players and frankly right now, they are hard to find.

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  4. MktgLeader

    I question your view of the A-player. First, I would not look for a “world changer” at a large company. Most of these people are specialists at one piece of the business. They may be an A-player at their sliver of the world, but are they innovative enough for an aggressive organization like yours? It has been my experience to find more C-players than A or B, hiding in large organizations playing it safe and floating along feeling protected by their seniority. The longer they are there, the more narrow their focus. These people don’t know what they don’t know. Second, many spineless organizations of all sizes are making their cuts by seniority not talent to protect themselves from litigation. There are some rock-stars at all levels available right now because of this. These LIFO candidates often look like “job-hoppers” on the surface but are key talents who took risks going to their last organization with plans to change the world and have great experiences to show for this entrepreneurial behavior. Lastly, if I am hiring, as tempting as an A-Player looks, they often have baggage that is not worth the risk. I would look for a B-player with potential. Many A-players bring with an arrogance that can be counter-productive and damaging to the corporate culture. As the leader I would want the B-player with potential so I can shape this person and the rest of the team into the A-players of tomorrow.

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  5. Patricia

    JR…can I refer you to him? He really does knows his stuff but doesn’t like being out of work. His circumstances are “cloud specific” so I have no problem getting you two connected.
    As far as the age thing is…it is happening to people in their mid-thirties too (myself as example) so there isn’t any pasture to speak of because we all seem to be “out to pasture”

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  6. Andy

    We’re doing a lot of recruiting now too, and I generally agree with your article. But, of course, we’re also getting a lot more resumes now than before. I’d say the A’s applying for jobs has gone up too.
    So, if you’re willing to put in the work to screen, there are A’s available for the taking right now. That’s not always true. A couple of years ago, you could go weeks or months without getting a single A. Now, they’re in the stack. You just have to find them.

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  7. Jon Meyers

    Thanks for the article, Auren. As part of my business I often find myself building teams and/or helping to hire in talented folks for my clients. I’ve observed pretty much the same phenomenon over the last year or two – there are a lesser percentage of the more accomplished people available. Sure, there are A-players who decide to leave a company for a variety of reasons in this market, or the company they took a risk on simply crumbles under them. But there are a lot more folks laid off right now who are not at the top of the game in their area of endeavor.
    Of course, there’s a range of opinion on what constitutes an “A-player” with respect to any specific position in a company. Your article seems to imply raw technical (or other functional) experience and knowledge. Personally I believe that true “A-players” also have the soft skills that make them great members of a team whose positive influence extends beyond their assigned role in the company.

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  8. Elliott Ng

    OK, I agree with this assessment. One trend that I’d like to play out is that many A-players leave to start their own company but they represent an unfundable incomplete team. With a rocky time in front of us, perhaps some of these A-players would seek another successful startup platform to do innovative things. At UpTake, we are looking for people like this – and we have the platform to provide them. Contact me at elliott at uptake dot c0m. We are hiring a few rock stars and just like Rapleaf have dinged a massive number of fairly good people to wait for the right person to join our team. Thanks Auren for another insightful post on hiring!

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  9. Fabrice

    We have definitely observed that to be true at OLX. Since the crisis started we received many developer applications – but almost all of them failed our tests…

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  10. FOARP

    The biggest problem by far in recruitment is that many recruitment ‘specialists’ are essentially salesmen who do not understand the jobs they hire people for – more than 30% of IT recruiters here in the UK admit to not understanding their own job adverts! The more specialist the field, the less the recruitment people tasked with sorting through job applications are actually equipped to choose quality candidates – the flood in applications caused by a larger pool of workers only exacerbates this.
    When a downturn comes, yes, the poorer quality workers are more likely to be laid off, but it is also the older and more unpopular of the staff who get laid off regardless of the quality of their output. Talk of ‘A’ workers being targeted is misleading, most recruiters aim for experience rather than anything else, and use this as their main measure. Sure, experience does correspond to ability, but not closely enough for anyone to say that they were targeting ‘A’ workers by only accepting the experienced. Testing helps, but only if you are recruiting people to pass a test! In the end, the interview is the best measure of a candidate.
    The recruitment industry itself is yet another example of the ‘cult of the salesman’ which afflicts western industry. Rather than targeting actual ability, it raises the ability to ‘self market’ (urghh!) above all others.

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  11. Ani Adhikari

    Very interesting, Auren, because our grad admissions process is just finishing up and I am seeing a phenomenon I can’t explain: an enormous increase in the number of highly qualified U.S. applicants to the Ph.D. program. Were they all going into industry before? What we are seeing is absolutely unprecedented – the A-Players have gone through the roof, whereas the B and C players are more or less constant. International applicants are pretty comparable to past years. But the picture of the domestic applicant has changed.
    I think partly it’s because young mathematicians have finally realized that areas like machine learning involve very cool math, but that can’t be the only reason. I am convinced the downturn features somehow, but can’t put my finger on how.

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  12. Mark Granovetter

    The problem you mention here is not as severe as it sounds because people rely heavily on their contact networks to find out the real details and subtle information about people they might want to hire. There are many studies of this phenomenon in detail, including my old work on how people find jobs, and many newer accounts. As you no doubt know, getting subtle information through contact networks is absolutely crucial in many sectors, including for VCs — you might enjoy the article of mine and Michel Ferrary’s on VCs in the upcoming issue of Economy and Society. So I think where your logic leads is to the proposition that from the employers’ point of view, contact networks are even more crucial in a downturn than we might expect, since there is more variance in prospective employee quality among the non-employed than when labor markets are tight. But I think it remains to be seen whether they are more crucial than in tight labor markets, when your “A” players have to be lured from steady employment. This deserves to be looked at a lot more closely.

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  13. buckleyPLANET

    Innovation Attracts A-Players

    I was reading Auren Hoffman’s latest blog post on why finding A-players is harder in a down economy, and one point he makes really resonated with me…

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  14. FOARP

    I suppose it would be going too far if I were to say that talking about the unemployed as if they were so many sub-standard items is in somewhat bad taste.

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  15. Joe

    Overall, good article.
    I would have to agree with MktgLeader. As we have all seen, there are people out there who have an uncanny ability to “hide” within organizations. Another thing that the article seems to imply is that most organizations are “honest” in assessing their talent during times like this. In the past I’ve seen entire departments eliminated along with A, B & C players where the issue entirely had to do with “cost” rather than dumping dead weight. I’ve seen A players removed during transitions due primarily to internal politics, in-fighting as well as incompetent leadership that really didn’t seem to be qualified to assess it’s own talent (mostly in startups). There are whole host of factors at play here.
    Hiring (in my opinon) is easier now in that there is more quantity of quality available. There are more passive candidates willing to consider jumping ship. What every hiring manager is going to have to sort through when they are sitting down with a candidate who has been laid off is no different than assessing talent during normal times. You have a candidate sitting before you who wants to leave their company. Why? You have a person who was laid off. Why? Times like this are actually a greater assessment of your judgment as a hiring manager as well as your ability to peel back the onion to differentiate truth, fiction and the in-between. The other factor at play is that just because someone was an “A” player in someone else’s company you can never assume that they will perform in yours. A “magic article” or a “formula” is never going to be as valuable as good judgement on the hiring managers part.
    Perhaps the next article could be along the lines of “are you a competent at hiring?, do you know how to manage the talent that you have? what to look for in a “A” candidate, do you really need an “A” candidate in the first place?”

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  16. Christian Buckley

    Auren, interesting point. What particularly caught my eye was the comment on innovation as a necessary ingredient to holding onto talent. Completely agree. This topic has been on my mind since attending an event with Malcolm Gladwell, and the whole idea of talent capitalization. Blogged on it here: http://buckleyplanet.typepad.com/samaritanweb/2009/03/the-capitalization-threshold.html
    I think your underlying message of “raising the bar” should be true at all times, not just in an economic downturn. Hire people who will improve your team, not just meet the expectations of the posted job description.

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  17. Michael Martin

    A related point, I think, is that great people are always attracted to great people. So as the signal to noise ratio gets worse in a recession, companies like Rapleaf are paradoxically at a greater competitive advantage in hiring because their culture itself provides a better means for discriminating signal from noise. The signal tends to jump out from the noise when a candidate’s attitude is in sync with a company’s existing culture.

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  18. Michael Ryan

    I enjoyed your blog. Right on target. Bravo!
    I think you are right about the 1%, 19% and 80%;
    I use the statement:
    – 1% actually makes things happen in the universe
    – 20% watch things happen;
    – 79% wandering what the hell happen!

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  19. Ken Berger

    On the structural elements of this post:
    The post is remarkable because you can the gist of the message from reading *only* the headings. The second sentence/subtitle in italics could actually be all you need to see (so really the whole article could have been Twittered!)
    Then, the headings communicate the story if you don’t have time to read, don’t know Auren (altho probably no one is in that category), etc.
    More writings should be like this.
    tip: offer the MacBook Air to the biz types, but not to the super-developers– they will all want a MacBook instead. I’m finding this out myself.

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  20. René

    Interesting research but I think that’s a normal approach.
    That’s why many people live in poverty, most live in “normal” region and only a handful are millionaires or billionaires – in my opinion that’s a good mirror of our society.

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  21. Ron Berman

    Auren,
    I was delighted to read your post as someone who once had to work on a screening process to find the best 30 students out of the top 5000 students in Israel, every year.
    Given all of them were the top 1% of the population (A-players by definition), you probably imagine how much noise we had to deal with.
    The only problem we faced, and I think any company would, is when scaling the process to larger numbers, without compromising for quality.
    Suppose that instead of 6 developers you now need to hire 60 A-Players…you would need to rent an entire building to have people write down the written interview answers…and then have your entire company interview the ones who pass…
    I guess the only solution is a very scalable and rigorous screening process, where interviews are only held for people who are surely B-Players, and just need the extra assurance they are A’s…
    – Ron

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  22. Jan Brandt

    I did enjoy it and agree completely…and have counseled people similarly. My personal experience is that there are more B’s– or at least a company can force more B’s by doing periodic layoffs and resource realignment in good times as well as bad.
    I agree that the A’s incentive to leave right now is about job satisfaction, ability to innovate, and positioning for increased responsibilities when the tide turns. These are generally people who thrive on new and different experiences and breaking new ground. Of course, these are the people that companies most want to keep, and other companies want to lure away. I have gotten around the “why should I leave my very secure job” in this environment by offering people a one year employment guarantee. (Very senior executives would likely need to be given more)
    That’s really not as expensive as it might sound…
    The hiring company doesn’t have much to lose, especially if you think that you have an “A” player in your grips. Let’s say that you make an off call and hire a B when you thought you were getting an A. With the relatively small percentage of B’s, you are most likely to want to keep that employee anyway.
    Let’s say that you made a bad call and you’ve hired a C instead of an A. Most executives won’t/can’t really judge performance (unless it is wildly unacceptable) for 3-4 months. Then most executives spend another 2-3 months in “self-doubt” about whether they are being too hasty in judging etc. If you are in an established company with a strong HR/Legal department, you might add another couple of months assuring compliance, if you haven’t already done so. Maybe add in a month’s severance you might give the employee anyway– and realistically you are out of pocket maybe 3-4 months at most in salary if you need to fire the employee before the one year guarantee is up…not that high a cost if you think you may be snagging an A or even B+ player.
    By the way, in this environment, scrupulous reference checking is even more important…there are lots of tricks for that…but that’s another story and another topic 🙂
    It was a good read…thanks for passing it along.

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  23. Daniel Greenberg

    I like the provocative premise that hiring is harder in a downturn…but I don’t buy it. Given what’s happening in the economy you have to accept that its a fact that the sheer number of A-players available is higher than when the economy was booming.
    If you accept this, then the only challenge is one of having a scalable screening process. If you’re smart about how to do this, then you have a MUCH HIGHER probability of landing an A-player in a bad economy than in a good economy. Its almost a law of physics. This is the same premise as driving sales for a company: increase the number of leads in the funnel and you’ll get more sales…assuming you’re smart about screening prospects.
    So how do you create a scalable screening process? Insert a structured questionnaire into the process, hire a low cost screener to filter applicants (via email or over the phone), add in a test, and make sure that this is all outsourced so your core team isn’t distracted. Only bring the cream of the crop in to interview with your team.

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  24. Elaine at Lipstickdaily

    Great post. Do you think job level, salary matters? Many companies are not only trimming headcount, but are also aggressively cuting costs – – including cutting the salary profile. An A player will be a high earner. That A player may get cut where the company chooses to rely on the lower paid B player to get the job done (but not necessarily innovate) to survive a financial squeeze. Happens especially at the higher levels.

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  25. richard rabins

    A fascinating post. I suspet you may be right about the paradox. There a another dimension to this though. Some really top people do get laid off and often these people get fed up with the risk associated with getting a traditional job, so they embark on an entrepreneurial path (16 of the DOW JONES 30 companies were started in a recession.)
    Many of these new entrepreneurs are VERY open to creative approaches that allow companies to partner with these entreprenuers without the cost of hiring them in a traditional way.
    Let me give you a practical and real example.
    Our company http://www.alphasoftware.com makes a product Alpha Five for building modern AJAX web apps that allow Software as a Service (SaaS) businesses to be created and launched quickly (example SaleForce.com is a SaaS.)
    We had an idea for SaaS product that our customers have asking for.
    Instead of hiring new people, we have offered office space and support services to two extremely talented people who lost their jobs (due to their positions being eliminated.) They are spearheaded this SaaS effort and are being compensated based purely on the results of the new SaaS.
    They turned down traditional job offers (to work with us instead)because they have confidence in their abilities (remember they are A types)and believe they can do much better and have much more control over their destiny by being entrepreneurial.
    I would love to receive comments.
    Richard Rabins (richard@alphasoftware.com)
    Co Chairman
    http://www.alphasoftware.com
    http://bog.alphasoftware.com

    Reply
  26. John Moore

    I could not agree more. I see a lot of resumes and chat with a lot of people who want to know if I’ve heard of any open jobs. The jobs are out there, of course, but many hiring managers now see 100 resumes for an opening when in the past they would have seen 10 – 20. It’s hard to stand out and it’s hard for hte hiring manager to determine the right fit.
    I recently wrote about what unemployed IT/Engineers should be doing as they are seeking their next roles. If you’re in this camp, feel free to check it out here:
    http://johnfmoore.wordpress.com/2009/03/22/things-you-should-be-doing-if-youve-lost-your-it-job/
    John
    http://johnfmoore.wordpress.com
    http://twitter.com/JohnFMoore

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  27. EmKay

    I am an A-Player. I have been recognized as an A-Player in every job I’ve ever held. I am fast and thorough. I produce much more than anyone I’ve ever worked with. I am ready to move to the next phase of my work life. But … I am soon to be 59. (I don’t look or act my age!) Even though I have tried to keep my resume generic enough to not show my age, it’s apparently not being looked at. Yes, my skill set is somewhat specific. For the past 20 years I’ve worked as a data analyst/Director of Information Services in the non-profit sector. And my target area is somewhat specific. (either the Tampa area or the Seattle area) So … my question is … How do I get an interview? I know that I can “WOW” a prospective employer … if we can talk. Help!

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  28. Kurt Cagle

    Auren,
    While I think in the main you’re right in your analysis if this was a normal recession, I’d also caution that what we are facing now is unlike just about every recession I’ve seen after nearly 30 years in the IT field. Companies that were generally thinking that they were going to be all right were blindsided by the speed and severity of the credit crisis, and as a consequence, faced massive drops in their ability to meet payroll over the course of a few months. What this has done is forced companies to “liquidate” their A-listers in disproportionate numbers.
    Overall, however, I also think that a lot of those A-listers are not in fact jumping right back into the market, at least not directly. Most of them likely have a bit of a pad – A listers may be more productive, but they generally know it and can command more for their efforts. They also recognize that in a market that’s this unstable that there will be more B and C list companies that over-cut, often alienating their own A and B list talent, and that many of these companies may be insolvent by the end of the year. They will also likely be heating up their networks, looking not for work, but for other A and upper B listers that might form the nuclei of their own companies and take advantage of the market as the B and C list companies exit the scene.
    The thing to remember about those A-listers is that they are, by definition, not stupid. They will be looking for A-list opportunities at this stage, and they recognize that if they act now, their chance of ending up in a B or C level company (with limited opportunity for development or innovation) will be very high. Eventually, they may be forced down that route as their resources run out, but I suspect that the A-listers can hold out a lot longer than the B and especially C-listers can.

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  29. Romy

    Amazing analysis. Love the way you have broke it down. I am a graduate student and think the standard hiring process needs to be revamped completely. But it also poses an interesting challenge for all of us: we have to think out of the box to land a great job.

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  30. Philip Hines

    Good analysis. So why is it that project managers so frequently can’t tell the difference between A, B, and C players. There are a lot of people that look good and sound good and can fool a PM, but really don’t contribute anything in the end. These people somehow frequently become PMs over time…perhaps because you can’t afford to have the people who do all the real work to stop getting everything done.
    Also, these principles are frequently ignored, especially in the defense contracting area where everything seems to be based on years of experience regardless of how much you actually contribute. I know plenty of people who were more senior and made more money just because they had 15 years of experience at doing nothing compared to others who had say 5 years experience picking up the slack for the “senior” people.

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  31. tom summit

    Daniel,
    the problem is A-players do not become “available”. They simply move on to their next opportunity through their network or employers that have reached out to them prior to the RIF or decline in interesting work to be done.

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  32. tom summit

    Ron,
    I don’t believe that hiring A-players can scale beyond a 20 to maybe 30 person company. Certainly Microsoft and Google have tried, but it takes an enormous budget and focus and still cannot succeed due to statistical impossibility.

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  33. tom summit

    Mark,
    The strength of “work ties” is what drives job change. I believe that A-players are not that concerned with how tight a market is. They move so that they may continue to do stimulating work and understand that ultimately, they derive job security from their own skills and abilities rather than from their current employer.
    Determining the A players is done through referencing the professional network. As Auren points out, reading resumes will not surface the A players, nor will interviews, but if Paul Buchheit tells you an engineer is an A, you know that is the case.
    PS: I look forward to reading the article you mentioned.

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  34. Bob

    There is empirical data available for two aspects of your treatise. First, we have data which shows the productive relationship of superior performers to average and nonperformers PLUS the economic impact of each of these combinations. In addition : A performers ( synonomous with superior performers) typically represent 16% of the working population. If you would like further information email me at info@rlhassociates.com. Our website is http://www.rlhassociates.com

    Reply
  35. A level player not on the market

    I consider myself an A player who got laid off by a dumb company. The thing about those A players who got laid off for political and dumb reasons is that they don’t stay on the market for long. They actually don’t even have to send out their resumes to that many people.
    Because of my reputation, I had 3 people referring me directly to the C level or VP of 4 companies. I had 4 interviews within 2 days of the lay off. I got a written job offer (that was essentially a raise) the day after the severance package period (2 weeks) ended. Now, I am off the market again.
    So I agree with the main point of the post that signal to noise ratio is much smaller these days if your hiring standard is high. The hiring companies have to put in more time to sift through more resumes to find A players.
    But the underlying cause is not that people who get laid off tend to be C players. My former employers did two rounds of lay off this year. In both rounds, they got rid of A+ members of the team. Among the people who were laid off, some are starting their own ventures. Many from the first round that happened in January are already at their new jobs.
    The Fortune 500 company I used to work for laid off the entire branch which had a stellar engineering team a little over a month ago. Guess what, most of the A players from that team already had offers and some already started at their new jobs. Many of them did it through their professional networks.
    Employers who are looking for great talent need to look at their personal networks, not what monster.com is sending them. There are dumb companies out there who don’t really know great talent when they see it or they rather keep their loyal ‘yes men’ over productive people who don’t spend 80% of their time managing up. There are software giants getting rid of entire branches for budget reasons. They are letting go of great A level players. You just need to know where to find them.
    You remember this really great developer you used to work with at some previous company that you always wish you could work with him again. Drop him a line, he might be looking or he might be signing an offer while you are filtering through submitted resumes.

    Reply
  36. JT Pedersen

    Hello,
    Yes, this was an interesting read, at the very least. The core premise is agreeable. However throughout my reading I kept thinking, as some of the comments revealed afterward, ‘…a lot of As, can be Cs, or vice versa, dependent on their role. Whether you’re an A, B, or C, does not remain constant throughout your career. Further, you cannot simply assume all As have great personalities…therefore determine an A based on motivation, inspiration, optimism, or the like.
    One of the reasons I voluntarily chose to leave a former employer of 13 years, was I realized I had fallen from being a strong-performing A, to a B (and shudder), and may be heading into C-land. Roles, my place in the org., had stopped keeping me challenged and I knew it. Leaving to pursue a new opportunity was great. Economically not the case, but I’ve learned -so- much more, it can only serve to help long term.
    We can learn a lot by reading (blogs, books, course texts, etc). But some things you can only truly ‘appreciate’ through experience. My experience has taught me you have to till your field periodically. A sure ‘likely’ sign of a C is someone who has stayed in one place for too long (even if they showed good movement within a given org.).
    An A today can be tomorrow’s C. There’s a reason for the disclaimer, ‘…past performance is no guarantee of future performance.’
    Cheers,
    JT…

    Reply
  37. Auren Hoffman

    JT — really interesting comment. i’d like to highlight your last line as i think it is really insightful:
    “An A today can be tomorrow’s C. There’s a reason for the disclaimer, ‘…past performance is no guarantee of future performance.'”

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  38. Adam Singer

    “Unfortunately, it is really hard to tell the difference between an A-player, B-player, or C-player just from a resume.”
    Agreed – this is where things like blogs make a big difference. Especially if you can post tangible case studies of work. If they’re really good this can help define the fact that you’re an A-player.

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  39. arango72

    Elaine makes a good point as my company is doing just this…cutting A’s and counting on B’s to get the job done. Particularly through extensive offshoring.

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  40. Bob Solis

    I enjoyed the article Auren but like JT, disagree with your premise as I have fully interpreted over at my blog today. (www.BobSolis.com)
    Past performance no longer reliably predicts future performance, as behavior or success in one industry or particular company may be for unidentifiable reasons and most certainly in the case of many C-Lits blossoming into A+ people under the right conditions.

    Reply
  41. Torley

    This is tough to talk about because of political correctness, moving targets (like JT referenced), and no one wants to be thought of or admit they’re anything less than A-class — not unlike those psychological studies where participants believe they’re better than average drivers (or another skill).
    I believe a true A player must demonstrate this over time. Some people have brilliant but fragile personalities and buckle under stress or can’t sustain quality for long periods of time. Don’t just look for quality, look for QUALITY IN QUANTITY.
    I enjoyed this post, Auren, that much is evident. I also like on your avatar here, how it shows your mid-section but on your face. That’s unique.

    Reply
  42. Torley

    Now is the time to thank Auren for unintentionally getting me to signup for TypePad Connect — I just couldn’t live with having a generic avatar! 😉

    Reply
  43. Bart Gragg | Blue Collar U.

    Can ‘C’ players become ‘A’ players? I have been working around that theory for some time and the fact is, yes, they can. BUT the candidate you choose to coach and coax higher up the food chain they must have a willingness to become an A player. Or else they are not an A player by definition.
    It follows the ‘Petered Out Principle’ which I wrote about in my book. To a large degree this happens to labor that moves into management. They are promoted into a ‘no man’s land’ and left to fight it out on their own.
    With the high cost of replacing a bad hire or promotion, why don’t orgs. take the time to effectively support their people?

    Reply
  44. gerdien dalmulder

    All in all I liked the post (reminds me of the x-type and y-type people theory Douglas McGregor posted in the 1960’s). In knowledge management what you’re referring to is know as the 1:10:90 principle (thanks to Nick Milton for teaching me this).
    – 1% is inspired & knowledgeable enough to share and contribute knowledge of their own initiative
    – 10% will add to the body of knowledge once someone else has set the example
    – 90% will consume without contributing, or not even bother
    So your percentages may be more in line with these numbers actually. On the other hand I cannot help but wonder about the stats Auren uses (Berkeley students). To me getting things done faster is not the same as getting them done better. Speed is one dimension of productivity, but if you don’t do the job right you just create more mistakes faster. So I wonder – did this study take the quality of output into account as well?

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  45. M.Bakry

    good article, with some flaws… I would call it a ‘b’ article. An ‘a’ article would have been a lot more researched and tourough and would hence be Able to defend itself from the different pov’s. I believe that most people have an ‘a’ talent in them which shines when put in the right place ‘they should put themselves there’. If a hiring manager works with the mentality of finding this ‘a’ capability in people, his chances of hiring more A’s would jump significantly since in the process, they would be turning previously labeled B’s into A’s. Also, if u want to hire absolut A’s, pls be ready to reward them for what they deserve. I have personally just been laid off from one of the biggest and best organizations in the world, and I’ve been top rated for the past 8 out of 10 years, the past 8 included! I will think 100 times before I get into the untrustworthy corporate world again… I’m going private and I’ll start hiring, or probably partnering. I need people who beleive in themselves and are true to themselves ‘if u think u’re B or C, face it and deal with it, this is Your capacity in what u do so decide if u want to increase your capacity or change ur field or simply stay b or c”.

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  46. Ami

    Good summary and analysis on what we have been seeing the last few months. By the way, it looks like you are a software engineer, the same goes to tech-biz people (marketing, ops, sales, etc.) I would extend the original article and say to hire lots of A-player biz people into the tech company. If you think an ‘A’ programmer makes a difference try it in sales and marketing !

    Reply
  47. David Locke

    Somewhere in this discussion of C-players, the C-company gets ignored.
    What laidoff people should realize is that their career is over. HR will never hire a laidoff person, so staying in the same field is nuts. Find something else to do.
    When the economy picks up again (2023), the people with jobs will get hired. And, the kids coming out of school will get hired. Nobody else will get hired in a situtation that could be called anything more than being underemployed and under paid.
    Forget about waiting. Move on now.
    The people who were laid off during the dot bust went through this. They now do other things. There is even a name for them “The missing millions.” Yes, at an age somewhere under 40, their careers came to an end.

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  48. Doug McIsaac

    Having owned software company that was hiring after the Dot Bomb flame outs I have to agree with you about noise levels increasing. I went from receiving a 70-100 applications for positions to receiving 500+ for the same positions. Getting through the barrage of resumes became ridiculous. But there were some absolute gems in there that helped grow my company.
    Doug

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  49. Sebastian

    If you were an A player you would do what an A player would do: Find an solution in one’s own network, as mentioned earlier above.
    But may be your network is not that big, as you’ve stayed put for several years.
    So, why don’t you establish your own business or freelance? My experience, based on what is happening right now here in Europe, is that in the economic downturn, we currently face, companies outsource projects just to cut fix costs. In addition that helps companies to question the quality of work they never would do with their employees, as they are “just there ready to work”.
    When you survive while freelancing, and you definitely will as you are an A-Player, then you will get to know more companies, more projects, more people, extent your network and at the end will get a job offer and hence an interview, as you so desperately want to work in fixed and settle environement.

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  50. Sebastian

    Very good question.
    Because – as very briefly mentioned above in several responses:
    – There are office politics going on.
    – There are biased opinions.(You might think Peter is an A but I think he is only a C. You are looking at the speed Peter finishes his work, I look for quality)
    Plus:
    – There are standard procedures how to rank and screen people. (If you do have those, people will allways try to manipulate those and make themselves shine.)
    So yes, very good post and most of us agree on it because we FEEL those points and have experienced these directly or indirectly. But the underlying question still remains: How can I judge A, B and C?
    Well, that most likely depends on your parameters. So in your case people use parameters to judge that are easy (age) but not necessarly the most appropriate one’s for the job. That brings us to the question that people hiring in the examples your are giving are not necessarly A’s themselves.

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  51. Sebastian

    Wow, very impressive insight. Thanks for sharing.
    It makes you actually think:
    If those big Fortune 500 comanies are reducing staff just to cut costs and they are not able to see that they are throwing out their best workers and stick with less quality, they will run into future problems. Even if the economy is rebounding some day.

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  52. Sebastian

    Very true.
    I got stuck in the same situation and established my own business. Best decision ever.

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  53. Job Hacking

    Do you know your ABCs?

    Tod’s post on Why Hiring is Paradoxically Harder in a Downturn was clearly of high interest in the recruiting world. And, yeah, he’s right, there’s a very high signal to noise ratio when you go looking for talent in this…

    Reply
  54. Auren Hoffman

    small firms and large firsts are the same — you should be consistently upping your average employee and scouting for A Players.

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  55. Joseph Sherman

    Thank you Auren. Your article helped me a lot. To be more specific, I am in the process of recruiting interns for a marketing consulting firm that is based in the US and opening a branch in Shanghai. At first I asked for the traditional resume and cover letter, but after a short time these all start to look the same. Now I am asking for a short writing sample that could be a blog post. This will help with the written quality, but how to I find out who is the A/B/C players in other areas? Again, thank you for your great blog.

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  56. Auren Hoffman

    Joseph — asking for a writing sample is a really good idea. you might also ask them to give you and your staff a powerpoint presentation to help with marketing.

    Reply
  57. Petal

    What a load of North American mumbo jumbo. People are a hell of a lot more well-rounded than your A, B, C analysis tries to prove (and fails dismally). Management fails so badly because it tries to box people into types and then assumes we’ll all behave accordingly. Everyone is a star, some need more polish than others and going slow is not a crime nor a bad outcome for humanity.

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  58. Junda

    Agreed. I have now more resumes to screen through just to hire 1 guy 🙁
    I am actually wondering that the number of available A-players might drop.. as when the economy is bad, it is a better time for these bright stars to start a company of their own.

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  59. Matteo Fabiano

    Two parts to my comment.
    About the process. The best organizations in the world have developed a process that includes tools like questionnaires, tests and cases. When I joined P&G the selection process include resume, application form, GMAT-like test, personality test, presentation-skill test, business case analysis, individual interviews, group interviews. If anything the process tested your endurance! While that may just not be feasible for your average small business, I think any hiring organization can do more to learn about the candidate. For example, for marketing positions, I ask candidates to work on a very simple, real business case (e.g. a new product launch strategy) and document their ideas. It is a remarkably valuable and low cost tool to assess both domain/industry knowledge and interest in the job (if someone balks at the request or fails to work on it, you know they are not that into your company :))
    Second, about the analysis. The article rests on a fundamental assumption that ANY company has access to A-players or at least all the available A-players in a specific domain. That is simply not true. For example, let’s consider the subset of all A-player graduates from top colleges that are interested in Management Consulting. Now, a leading firm, such as McKinsey for example, is almost guaranteed that close to 100% of those A-players’ resumes will end up in its funnel. Sure they will be buried in tons of not so good candidates. For McKinsey is then only a matter of putting in place a good process. That is simply not true of Mom&Pop Consulting Group. In fact, M&PCG is almost guaranteed that none of the A-players will apply. The difference here is the buyer’s (i.e. the company’s) brand. Now, some will say, M&PCG should simply actively seek the A-players in the hidden market. Nice, but I doubt it to be economically feasible to go find out all the A-players. Even if that were possible, most A-players would have no interest in the company.
    Every CEO likes to think about his/her company as the best place to work on earth. The hard truth, that every startup founder is all to happy to ignore, is that for the vast majority of companies, the pool of realistically “reachable” A-players is close to nil. No matter the market.

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  60. Edward Hendrick

    Great article Auren, can’t stress this point enough – now is the time to get excellent people, there are a lot of them out there so take advantage of this.
    If the right candidate is not found from the initial applicants, advertise again. Only hire the right people.
    Make use of the screening tools out there. The more you screen the applicants the more likely you are to get rid of the wrong people. Applicants are currently applying for jobs everywhere, just because you have an application from someone it doesn’t mean they are genuinely interested, and that is what you need, people who really want to work with you.
    We have a video interview tool that is great for screening applicants, it is cost effective but also puts that bit more pressure on applicants to declare their interest in the role.
    Asking them to go through this process even helps screen the list of applicants further.
    Would really like to hear what people think.
    Regards,
    Ed
    http://www.sonru.com

    Reply
  61. Cincy Recruiter's World

    Spanning the World – Links You Can Use or Peruse – April 17th Edition

    Each day, there’s an enormous amount of great content produced by people all over the world and put out on the world wide web. Sometimes it’s from a high-profile journalist or weblebrity, and sometimes it’s from a little known blogger…

    Reply
  62. everyman

    Interesting post. I disagree with your premise about the value of A players, though. Yahoo is full of A players yet isn’t innovating. Google could be full of C players and the bottom line would still be the same. In fact, most of its A players who are supposedly innovating are just making copies of other ideas (a la the Microsoft “a player” model) that aren’t even monetized. By sheer volume, Microsoft has more A players than does Apple, but who is innovating?
    The whole myth of A players just doesn’t ring true in all fields. It isn’t even shown to be true in some of the most measurable, competitive fields like professional sports. See the book Moneyball. Jeffrey Pfeffer’s work on the value of B players is also quite interesting: http://harvardbusinessonline.hbsp.harvard.edu/hbsp/hbo/articles/article.jsp;jsessionid=XYD4OWEZ1BB44AKRGWDSELQBKE0YIISW?ml_action=get-article&articleID=4007
    Also, it’s not clear Spolsky’s conclusions were valid. Your caption “fast students were 10x faster” doesn’t say anything – just quantifies fast but not “A” or “B”. Did the fast students also get the best grades? Were the slow students involved with other workload or extracurriculars?

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  63. Kelly

    I think you are putting too much emphasis on the candidates and not the company. As some others have mentioned in the comments, some As can become Bs or Cs if they aren’t in the right situation.
    It’s all about fit–I think the best way to hire top notch candidates for your company is making sure they fit with your company and the candidates goals align with where the company wants to go. Take a look at Zappos–they ask bizarre interview questions (i.e. “How weird are you, on a scale from 1 to 10) and the purpose is to find like-minded people to help the company thrive.
    Therefore others’ Cs can be your As (and vice versa). And otherwise I think all the advice holds true.

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  64. Siamak

    Every one is talking about A/B/C players…reflecting a growing class gap and meritocracy in our employment practices. But has any one wonder why there is no movement for an A/B/C employer ranking in pursuit?????
    Why such ridiculous expectoration from the poor job seekers and not from the employers equally? Where are we headed in this world with this growing mindset?

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  65. Skeptic

    How right you are.
    It is so typically arrogant of companies to just assume that they can get all the A (or even B+) players they automatically feel entitled to. But of course companies have their own “normal distribution”, and there just aren’t that many A or even B companies out there. I would wager even fewer than A and B workers. And big corps aren’t automatically A/B any more than smaller outfits are automatically B/C. B and C players will be choosy when they can, because the fact is there just aren’t that many good companies. It just kills me that everyone wants cutting edge employees, when there are so few cutting edge companies out there to work for.
    I also totally agree that a someone’s ranking is context dependent. My effectiveness has varied not just between the companies I worked for but within as well, sometimes significantly. A smart cookie whose value to their company has declined (it can happen for many reasons beyond your control) will bail before the axe falls or to avoid stagnation.
    Since there obviously aren’t enough A or B players to go around, companies would be better to stop obsessing about acquiring magic bullet employees, and try developing the talent that is there now. Remember how companies used to do that 25 or more years ago? But of course with the demise of company loyalty and the ascendency of the expendable employee, that is a pipe dream.

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  66. Criminal Record Check

    With the downturn in the marketplace, finding quality talent becomes more difficult no matter how you look at it. Of course it’s going to be harder to hire as the market is flooded with talent of all kind. Goes back to the word of mouth referral from quality sources as the best way to get talent.

    Reply
  67. buckleyPLANET

    Reaching the Coasean Floor

    Funny what you find when you clean out the office. While still at Microsoft, I usually had 3 or 4 books checked out of the wonderful Microsoft library, and as is my habit, I jotted down several notes from my…

    Reply
  68. Mo

    “an A-player is anywhere from 5-10 times as productive”
    So of course you pay A-players 5-10 times as much as C-players…?

    Reply
  69. hillsrenovator@hotmail.com

    I totally agree FOARP……in the end we all need an opportunity…why not look at it in this manner, A players are those with the most experience, B players on the way to gaining the necessary experience and C players not fortunate enough to have been given the right experience.

    Reply

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