Pareto's Principle: A Simple Rule for Recruiting Efficiency

Vilfredo Pareto would be pretty surprised to learn how many top executives rely on the basic principle that he came up with when analysing the pea pods in his garden.

Pareto observed that approximately 80% of the land in 19th century Italy was owned by 20% of the population - while working on this theory, he found that it didn't just apply to wealth distribution, there were correlations across almost every field. The "80/20" rule even applied to his vegetable garden, with 20% of the peapods carrying 80% of the peas!

It's safe to say that the concept has come a long way from the vegetable garden, many of today's top performers rely on the principle - Tim Ferriss even borrowed Pareto's ideas as one of the foundations for his seminal 4 Hour Work Week (a must read for anyone interested in improving productivity).

Today, Pareto's law equates to this: 20% of your effort is responsible for 80% of your success.

Now for the question on your lips: how can you apply Pareto's ideas to improve recruiting efficiency...

Here are 3 ways you can improve recruiting efficiency, once you get started though you'll see that there are a LOT of possibilities.

1. Sourcing

Not every candidate source is born equal. For each role there are certain websites or networks that will bear far more fruit than others.

[tweetery]Not every candidate source is born equal. Pick and choose for each role that you're hiring for[tweetery-end]

Let's take technical hiring as an example. Many of the best developers are leaving LinkedIn in droves, (partly due to years of 'recruiter abuse'), so the world's largest professional network is not necessarily the best place to source engineers.

Recruiters are using communities like Github and Stack Overflow to connect with the candidates that are hard to find, the very best prospects. For many, these sites represent the 20% time investment that carries 80% of the reward! (The reward being the best candidates!)

To learn whether this applies to you, you need to check your own data. Look at where your top (qualified) candidates come from, or better still, check the source of the candidates that you've submitted that have been hired.

Where have they come from? The answer will tell you where you should focus the majority of your time for maximum recruiting efficiency.

It's important to note that for many roles, the answer may well be sites like LinkedIn or Indeed (as opposed to newer, trendier sources that require more sleuthing and creativity - e.g. Goodreads). You shouldn't let this concern you, the source doesn't matter as long as the candidate quality is high.

[tweetery]The source of a candidate doesn't matter as long as the quality is high[tweetery-end]

Exceptions to the rule

There will be occasions where your top source doesn't come through for you, some roles are just trickier to fill than others. This is where you should let your creative streak take over and start experimenting with niche sources (there are a few pretty interesting candidate sources here for the curious among you!)

2. Interviewing

The interviewing and assessment process is a perfect candidate for a makeover from Pareto. There are dozens of small issues that are responsible for 80% of the inefficiencies that you experience.

Here are a few ways to make 19th Century Italian wisdom work for you to remove some of these problems:

i) Working with hiring managers

A lot of the issues that arise during the recruiting process are based around the recruiter and hiring manager relationship. There's a lot of unnecessary back and forth around the candidates that you submit that could be eliminated.

It all comes down to effective communication at the start of the process. Investing more time here can have a huge effect on recruiting efficiency.

One option is to include sourcers in the intake meeting - by having your "front line" recruiters involved here, you ensure that everyone is on the same page and that the candidates submitted are more likely to be what the hiring manager is looking for.

Another successful tactic is to kick off every search by creating a candidate persona to clearly define the exact qualities and experience that you're actually looking for. This forces hiring managers to give you a level of detail that goes way beyond the job description.

Now, your hiring managers have to be amenable to putting in time, but hopefully they'll see the potential for increased efficiency throughout the process (something that is very much in their interest too!)

ii) Choosing the right questions

If your interviews were shorter, how much time would your team get back cumulatively?

There are certain interview questions that cut through the noise and illuminate whether a candidate will actually be a good fit for your company (the 20%), and there are others that we ask simply because we've always asked them. If we focused more on the high impact questions, we could save time for everyone involved in the process from start to finish.

We're not suggesting that you try to get out of the room as quickly as possible (every candidate deserves a fair assessment), just that you think carefully about making every question count and eliminating those that are surplus to requirements. (Here's a pretty good list of interview questions for anyone looking for inspiration.)

iii) Assessment tests

The reason why (relevant) assessment tests are so effective in the application process is because they filer out a high proportion of the 80% of candidates that are not a good fit for your open roles.

It's one of the reason we've seen a big growth in technical assessment platforms like Codility and HackerRank (geared around engineering hiring) - they take care of the 80/20 analysis for you, all you need to do is look at the relevant candidates.

(For those looking to test culture fit we recommend the "airport test".)

3. Productivity

You're opening a real can of worms whenever you mention productivity - pretty much everyone has their own system that they swear by. It could be anything from simple written "to-do lists" to task management software like Trello or Asana, I've tried them all and each has it's on pros and cons.

Keeping Pareto's Principle front of mind will make a far bigger difference than any system you choose though. You should perform regular 80/20 analyses on your own productivity where you ask yourself the following questions:

• What 20% of activities are creating 80% of my problems and unhappiness?
• What 20% of activities are resulting in 80% or my desired outcomes & happiness?
• If I was completely incapacitated and had to work two hours per day – what would I focus on?
• If I was even more incapacitated and had to work two hours per WEEK – what would I focus on getting done?
• What are the top three activities I use to fill time to feel as though I’ve been productive? What are my CRUTCH activities?
• When do I feel STARVED FOR TIME? What commitments, thoughts, and people can I eliminate to fix this problem?

The goal here is to constantly re-focus yourself on the 20% of activities that actually make a difference. Regularly running this process will define your:

• 20% highest leverage positive activities -> Defines TO DO LIST
• 20% most negative activities (eliminate) -> Defines NOT TO DO LIST

Trust me when I say that this can have a giant effect on your weekly output and, ultimately, the success of your career as a recruiter. (If it works for you in a professional setting, try re-applying Pareto's Law to your personal life - again, the effect can be dramatic).

Final word

Pareto's Law is not a replacement for your existing hiring process, what it can do though is minimise wasted time and dramatically increase recruiting efficiency.