Why I Stopped Interviewing People – and Started Paying Them $400 Instead

A little while ago, I made a bad hire for my company. It was my fault. I didn't do the due diligence properly.

Did I fail to interview them? No. In fact, it was precisely the opposite. An interview is exactly what I did do, and I learned very little. Given that our business day in, day out is helping companies hire better people, I should have known better. This is my mea culpa. The bad hire cost us as well – not just the time involved in hiring them, but real money. Advertising costs and salary. It hurt.

Now we do it differently. We've given up interviewing people for the majority of our roles.

You've what?

Yup! We've given up interviewing people. Think about what an interview is. You're trying to assess whether a person is suitable for a job. How does asking them a series of questions or giving them some random test really tell you anything? If they're super slick, they know what you're going to ask and prepare answers ahead of time – answers that are often exaggerated to promote them favorably.

Interviewees often feed you what they know you want to hear. You sit there nodding, thinking you've found a superstar. But you haven't.

Suppose you own a racing team and someone applies to to be a racing driver on your team. Do you sit them down for a nice one-hour chat, or do you say, "Okay, sunshine. There's the car. Let me see how fast you can go around that track"? My guess is the latter; otherwise, you'd be hiring plenty of not-very-good drivers. Which is what I did.

Now, we do it differently. Very differently.

Don't Interview Candidates; Put Them to (Paid) Work

We recently hired a fantastic developer. Rather than make him or any of the other candidates do a random coding test that would tell us nothing aside from how fast they could code, we asked the applicants to build a bit of functionality for us. And we paid them, typically between $200 and $400 depending on what we asked them to do.

Why did we pay them? Because we were asking them to do between 10 and 15 hours of work. That's a lot of work, especially when you consider the typical hiring process is a couple of interviews and maybe a test of some kind thrown in for good measure.

There was no rush. We gave the applicants six weeks to do it. The one we hired did it in half that time.

Once you've drawn up your shortlist of 3-5 applicants, asking them to do some actual work for you has two main advantages:

It weeds out the time wasters and/or those who are not fully committed to getting a new job.

Because the work is extremely in depth, it allows you to see just how good a candidate really is in a real-life situation.

We're going to be hiring a marketing person shortly. I'm not going to bother interviewing them, either. Instead, I'll draw up a shortlist and have a quick chat with each candidate on the list over the phone. I'll explain what I want them to do, and they will get four weeks to put the project together: "How can we raise our profile in the recruitment software market?"

The task is deliberately quite vague to allow the applicants to come at it from any angle they want. They will be instructed to write a detailed business plan to cover a marketing program for the next 12 months. The person who gets where we're trying to get to – who understands and demonstrates the challenges of SMB marketing in a B2B context – will get the job. I won't show the resumes to my colleagues. I don't want their judgements clouded by how good they think a candidate might be based on a resume.

Hiring a designer? Give the candidates a real project you need done. The one who produces the best design gets the job. But don't forget to pay them. The people who don't get the job will at least be impressed that you have an innovative hiring technique and that you did, in fact, pay them.

Same with a customer service vacancy we'll have shortly. The candidates are going to present to us on the question, "What makes good customer service, and how could we ensure we offer the very best service levels to our clients?" What I want to see is that the candidates have done some research. I want them to tell me about new systems they could use to help. I want them to cite case studies on how other companies have improved their customer service. I want them to tell us what we could do differently.

Will this technique work for every discipline? Maybe not, but there are tons of jobs where it can. The next time you make a bad hire, ask yourself why it happened. Then, ask yourself if you could have prevented that by asking candidates to produce actual results before extending an offer. Stop the boring, formal interviews. Let the real talent shine by making the "game" more realistic.

Nick Leigh-Morgan is the managing director and founder of iKrut.