Patty McCord: Always Be Recruiting

Former Netflix leader urges tech companies to ‘get out the checkbook’ and fix gender pay gap

Roy Maurer By Roy Maurer January 19, 2018
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​Patty McCord, former chief talent officer at Netflix, is credited with building a workplace culture that prizes transparency over job security, promises freedom from rigid HR policies in exchange for superior performance, and pushes everyone in the organization to ABR—"Always Be Recruiting." 

During her tenure from 1998 to 2012, she helped create the incubator that propelled the company through explosive growth, while slaying many of the traditional standbys of corporate HR like annual performance reviews and employee engagement surveys.

She now advises startups and entrepreneurs and is the author of the new book Powerful: Building a Culture of Freedom and Responsibility (Silicon Guild, 2018). She will also be speaking Feb. 27 at Glassdoor's upcoming Best Places to Work Tour stop in San Francisco, which is viewable via livestream.

McCord discussed with SHRM Online the problems with hiring for "culture fit," how recruiters can become true talent advisors and the urgent need to fix the gender pay gap now.

[SHRM members-only online discussion platform: SHRM Connect]

SHRM Online: Practicing "radical honesty" is a major part of your message and what the Netflix culture has become known for. What's something radically honest about recruiting?

McCord: That simply being the pipeline for talent is not very fulfilling. Being a partner to the hiring manager to help put together great teams is super fulfilling. The No. 1 thing recruiters need to do is to get out of the business of finding candidates and get into the business of whatever business they're supporting. There's something about really working with hiring managers to own the hiring process to not just fill a requisition but to have added a great team member. But for this approach to work, recruiters need to understand the needs of the business, and hiring managers need to treat them as business partners.

The problem companies have sometimes is that they don't think about hiring somebody until someone else leaves and [they're] starting with a completely dry pipeline. Then, the [requisition] is written to either describe the fabulous person that left, a fantasy person that doesn't exist, or whatever it takes to get it approved. None of those are helpful to a recruiter in terms of finding the right person.

What you want to know is:

  • What is the business problem that needs to be solved?
  • What are the gaps on the team as it exists now?
  • What are we trying to accomplish in what time frame?

Then you can find someone really good at doing that, and not just [in possession of] 11 out of the 12 acronyms required on the job posting.

SHRM Online: Other than acquiring the relevant business intelligence, what are some other ways that recruiters can become true talent advisors?

McCord: By developing strong relationships with hiring managers and sharing sourcing methodologies with them to make them into effective recruiters. Our recruiters' job at Netflix involved coaching our hiring managers. It should be required that hiring managers are highly engaged in the hiring process. Teach them how to use their networks. Who are the people in their network and what do they know how to do? Being adept at social media is a gift that a recruiter can bring to the organization that keeps on giving. 

SHRM Online: That's the Netflix mantra—Always Be Recruiting!

McCord: That's right—ABR. I used to tell people in Silicon Valley that the richest source for recruitment was kids' soccer games. Standing around, chatting with people on the sidelines. "What do you do? Would you be interested in coming to talk with us?"

Candidates come from everywhere. Everyone can be a recruiter, not just recruiters. Recruiting was so important at Netflix that interviews came before any other meeting, and they were the only reason people could miss executive staff meetings.

I coach CEOs that they should also be recruiters. They should be models for the organization. And everyone should not only be recruiting for open positions but for where the business might go. Some old-school recruiters respond that "I want to be the one that delivers the candidate—don't get in my business." I think that that's an outdated notion and doesn't work.

SHRM Online: Where do you come down on the "hire for attitude, train for skills" debate?

McCord: It sounds a little cliché, and awfully simplistic. I've met a lot of happy, eager beavers who don't have the skills. That adage is used often in the startup culture, and it actually kind of works at first. When the business becomes more complex or the business problems are scaled up, then attitude alone won't get you there. You need people that know how to get the results you want. And there are lots of people that know how to do that, but they may not be people you want to hang out with. The best person to do that job may be someone different than who's there. That's where people get twisted up about culture fit. A lot of times I find culture fit means that he or she is someone they'd like to have a beer with. This hiring strategy can also contribute to a company's lack of diversity, since very often the people we enjoy hanging out with have backgrounds much like our own.

I advocate starting with the problem to be solved, and working backwards to who is the best person to solve that problem, instead of starting with the kind of person you want. You'd still want someone who has the right attitude, and someone excited to solve the problem. You wouldn't want to hire someone who can solve the problem but isn't interested in the challenge or doesn't like your company.

SHRM Online: What do you think about the movement to eliminate the salary history question from recruitment screens?

McCord: I think we have to do it for some period of time, otherwise we use it to keep people underpaid. I spoke in front of a group of Fortune 50 chief technology officers about two years ago. It's all men. I tell them that they have homework to do. To go back to their HR person and create a spreadsheet of every job title in the organization, with average male and female salaries. Go through that and whenever there's a discrepancy between men and women, get out the checkbook and make it right. The cost of doing that will be less than the cost of some software license that they'll never use. After that's done, we can have the conversation about unconscious bias, and methodology for screening, but first fix the pay.

Later, at the reception, an executive vice president from a big corporation comes up to me. He says that he's been so successful in his career because he's been very fiscally responsible. He asked me why he would pay a qualified woman the same as a qualified man if her previous salary was significantly lower than his. I asked him what if that woman was his daughter? He said "Well, it'll be fixed by then."

How? How will it be fixed? If we don't do something different, nothing will change.

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