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    Entries in data (132)

    Monday
    May222017

    Learn a new word: The Optimal Stopping Problem

    I caught an interview over the weekend with one of the authors of Algorithms to Live By (can't recall which of the two co-authors I heard, but it doesn't matter. Kind of like it doesn't matter which of the two guys in Daft Punk plays a particular instrument on any given track. But that is another story.), and wanted to share a new word I learned from the interview that has some relevance to HR/Recruiting.

    For this installment of Learn a new word I submit The Optimal Stopping Problem.

    From our pals at Wikipedia:

    In mathematics, the theory of optimal stopping or early stopping is concerned with the problem of choosing a time to take a particular action, in order to maximise an expected reward or minimise an expected cost. Optimal stopping problems can be found in areas of statistics, economics, and mathematical finance (related to the pricing of American options). A key example of an optimal stopping problem is the secretary problem. Optimal stopping problems can often be written in the form of a Bellman equation, and are therefore often solved using dynamic programming.

    I bolded the 'secretary problem' which, despite its dated-sounding kind of name, is the example most commonly cited when discussing optimal stopping, and as luck would have it, is directly tied to HR/Recruiting.

    The secretary problem is essentially, the question of 'Given X number of job candidates for a given position, and also given you have to make a 'hire/decline' decision on each candidate before moving to the next one, how many candidates do you need to interview in order to maximize your probability of identifying the best candidate, while minimizing the risk of making a 'bad' hire, (say by waiting too long, rejecting too many candidates, and having to settle for a candidate that is left).

    Let's say you have 10 candidates for a position. You probably wouldn’t offer the job to the first candidate you interview, because you have no idea how that candidate compares to anyone else, or the general caliber of the candidates overall . But you probably don't want to wait until the 10th candidate, because if they’re the only one left you’re going to be forced to offer them the job (or keep it unfilled), regardless of how strong a candidate they are. Somewhere in the middle of the process there must be an ideal place to stop interviewing more candidates just to see what they’re like, and make a selection. But where to stop?

    Enter the Optimal Stopping Problem. You can dig into the math here, but it turns out there is an ideal place to stop interviewing candidates, (or dating different people in order to try and choose who to marry), and it's after you have interviewed (or dated), 37% of the contenders. After you get to 37%, make a note of the 'best' candidate you have seen so far, (let's call her Mary Jane). Then, continue interviewing candidates and when you find the first one that is 'better" than Mary Jane, stop all further interviews and immediately offer that person the job.

    How it works is related to the math behind estimating where the best candidate could be in the lineup. This number, expressed as 1/e, where 1/e eventually approaches 0.368, or about 37%. By analyzing the possible distribution of talent, it also turns out that if you interview the first 37 percent of candidates then pick the next one who is better than all the people you’ve interviewed so far, you have a 37 percent chance of getting the best candidate. 

    It's a really interesting way of looking at the hiring decision making process, (as well as other processes that involve trying to make the 'best' choice amongst a number of alternative). But it makes sense somehow, even if only on an anecdotal level.

    How many times have you slogged endlessly through an interview process where after some point candidate after candidate seem the same, and certainly no better than one you saw two weeks ago?

    Or how many of us have, (maybe even privately), thought about a past boyfriend or girlfriend that 'got away' and for some reason has never been eclipsed by the series of people that you have subsequently dated?

    Knowing when to stop, and understanding the probability that you have seen the best, or close enough to it, in any decision process is an enormously valuable thing.

    In the secretary problem, and in probably a bunch of other problems too, the answer seems pretty clear - once you hit 37% you have seen enough, you won't learn much if anything else useful, and you know how to make your decision.

    It is easy to apply in a job vacancy with 10 candidates. 

    It is a little tougher to estimate just how many people you are willing/able to date in order to know when to apply the 37% cutoff.

    Have a great week!

    Friday
    May052017

    CHART OF THE DAY: The Decline of the Landline

    Really interesting data from your pals at the National Center For Health Statistics on the long, slow but seemingly irreversible decline of the home landline phone. Turns out, if you have dropped your landline to go mobile only, you are not all that odd any longer.

    Here's the data and as you constantly demand, some FREE comments from me after the chart.

    Some really interesting data for sure. The key points or takeaways for me:

    1. More folks than not have ditched the home landline. Just over 50% of households are now mobile only. Pretty soon it will be kind of odd and weird to still have a landline. Additionally, more than 70 percent of adults between 25 and 34 were wireless only. 

    2. Being wireless only, as a majority of households are now, means, (as if you didn't know this), that our mobile phones are constantly powered on, are always within reach, and have become probably the most indispensable piece of technology we own. What could you go without with longer, your mobile phone or your car? Or your TV? Or your coffee maker? I might choose the coffee maker, but the car and the TV I would give up. Why not? I can request an Uber with my phone and stream the NBA playoffs on my phone. Once my phone can make coffee, well...

    3. Since the mobile phone is the most important piece of technology most of us use, then gaining 'share' of people's phpne time, no matter of you are in marketing, recruiting, sales, or even HR, is the most impactful thing you can do to advance your agenda. I would posit that at least half, if not more like 75%, of the efforts you are making to reach people should be focused on how you are reaching them on their mobiles. We all know this but when I see data about the usage and penetration rates of mobile technology for HR I am not so sure we are really applying what we know to be true. 

    Anyway, that's it for me. I'm out, have a great weekend!

     

    Monday
    Apr242017

    VIDEO: Take That For Data

    Yes, I know this is a few days old, and yes I know the 'Take That for Data' meme has probably already flamed out from your Twitter feed, but there still may be someone out there who missed Memphis Grizzlies coach David Fizdale's epic rant following a playoff loss to the San Antonio Spurs last week.

    Tiny bit of backstory to set this up.

    In the game of interest, (which the Spurs won), the Spurs were granted a massive advantage in free throw attempts - with one Spurs player Kawhi Leonard shooting 19 free throws himself, more than the entire Memphis team. After the game Coach Fizdale reflects on the loss, and the officiating in an already classic 2:45 minute rant.

    Check the video below, and make sure you make it to the end,  (email and RSS subscribers click through), then some comments from me about why this was a really interesting take, (that have nothing to do with basketball).

     

     

    Not one but two great meme lines in the rant!

    But the walk off line, 'Take That for Data' is the one that stuck with me. Mainly because in the same video where Fizdale asserts 'I'm not a numbers' guy, he proceeds to rattle off 12 different statistics from the game - data points that strengthen his argument that the game was poorly officiated and that disadvantaged his team.

    Why does this matter at all to anyone except hard core NBA fans?

    Because Fizdale in his little rant makes plain the challenge and the tension that often arises in organizations and with leaders when they are pressed to take a more data driven approach to business/HR/talent when they are not naturally inclined to do so.

    Don't tell me this is all about the data, then make decisions or drive toward outcomes that are incongruent with the data itself. 

    Or said differently, if you are going to be the hero in your organization that will push the 'data' agenda, then be prepared to have your data be called out and your conclusions challenged when others have a shot at interpreting the data as well.

    Take that for data.

    Have a great week!

    Monday
    Mar202017

    CHART OF THE DAY: More on the increasing 'Quits' data

    Quick shot for a busy 'Can you believe my Gamecocks are in the Sweet 16?' kind of a Monday.

    Here's just one chart from the latest release of what regular readers recognize as my favorite labor marker report - the Job Openings and Labor Turnover Survey - aka the 'JOLTS' report. 

    This chart illustrates the amount of 'Quits'  better known in HR speak as Voluntary Separations, compared with the amount of Layoffs and Discharges, AKA, 'Pack your things, son, it's time for you to go' deals.

    Here's the latest chart of this data, then as we all have come to expect by now, some FREE comments from me:

    Three quick observations...

    1. Really interesting right now that these two lines continue to get farther apart, and the gap between Quits and Layoffs/Discharges continues to increase. The delta between the two series is now 1.6 million, with Quits hitting 3.2 million in January, against 'only' 1.6 million Layoffs/Discharges.

    2. The continuing increased in the level of Quits is generally seen as a proxy measure for the overall health of the labor market. The thinking goes that when employees feel more confident in their ability to find alternative work, (either at another company or for themselves), then they are more likely to 'quit' the job they have now. It is a seller's market for labor in some sense. 

    3. If this trend continues, and labor markets continue to tighten, (you can also look at total job openings to get a sense of this), then employers will (according to the immutable laws of supply and demand), be forced to take counter measures. They can either look to reduce 'quits' by raising wages, improving benefits, or striving to become less crappy places to work. Or, they can look to alternate sources of labor - offshoring, outsourcing, automating, etc., in order to find the talent/labor they need.

    The slow and steady economic recovery since the bottom of the last recession marches on. Unless something changes relatively soon, 2017 is shaping up to be a good year for folks who are in demand, have negotiating leverage, and are feeling as confident as ever in their ability to control their careers.

    Have a great week! 

    Go Gamecocks!

    Monday
    Mar062017

    CHART OF THE DAY: The World Economy in One Chart

    You may have seen this chart passed around a week or two ago when it was published on Visual Capitalist, but as I was digging through my 'Read Later' pile over the weekend I felt like it was too good and interesting not to share.

    So without further delay,  visual look at the global economy, represented by country contribution to global GDP, and then as you DEMAND, some free comments from me after the data.

    (Email and RSS subscribers may need to click through to see the chart, and clicking on the chart will bring you to a much larger version)

     

    Courtesy of: Visual Capitalist

     

    Really interesting and cool chart, right? Three quick observations from me about what 'normals' like us should be thinking about when looking at the data.

    1. Go USA! Ok, not trying to be too much of a cheerleader here. But while many other economies (namely China, but I will get to that in a second), have emerged on the world stage in the last twenty or thirty years, the USA still accounts for a shade under a quarter of World GDP. This is important for organizations, particularly US-based or centric organizations to remember even as they make their plans for international expansion. It probably would be a mistake to concentrate too much time and energy on markets that either are relatively small, (say the Netherlands or Spain), or not expected to grow as rapidly in the next ten years, (Germany or the UK).

    2. Don't sleep on China, (and to a lesser extent Japan and India). I know that it can be hard for many US businesses to wrap their minds around places like China and Japan. It is hard to to business there. The language and cultural barriers are more significant than say in Western Europe. It may take longer to establish a presence there. But make no mistake, future growth is being defined by what is happening in Asia - not in Western Europe. It may take a little more time, but the organizations that can make the investments, get in front of their competition, will be better equipped to capitalize in the parts of the world that are growing the fastest. 

    3. Perspective is really the biggest takeaway from a chart like this I think. We can, here in the US, get really full of ourselves,(see above), and it is a good reminder that even as the largest economy, more than 75% of economic activity is happening elsewhere. Insert your own country in the above sentence and the percentages get even more sharp. Places that we think of as economic leaders like Germany and the UK contribute less than 5% each to global GDP, while seemingly set up for being surpassed soon by places like India and South Korea. None of us are all that big a deal.

    Anyway, that's it from me for a busy Monday - have a great week!