
The hidden costs of engineering time in technical interviewing - leeny
http://blog.interviewing.io/you-probably-dont-factor-in-engineering-time-when-calculating-cost-per-hire-heres-why-you-really-should/
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ChrisCinelli
You could say:

"It is a funnel, you look at the stages, and at the end there is a great
engineer that is usually working for a long period for the company.

Each level has expenses and conversions. Go an optimize keeping in mind the
constraints."

But what I noticed is that is all about your company specifics and how you
overcome the trade off...

For example the average new startup in unsexy industry has problems to get any
body in the funnel. Getting somebody that know how to write some code can be a
challenge... interview is more about persuading them to accept the job.

Great "sexy" companies have ton of people applying and would do everything
they ask them to do. The problem for the company is to efficiently select
those people.

When you have enough candidates, somebody may think: "We can save time and
make accurate evaluations by giving a screening test offline to evaluate most
of the relevant skills of the person!". Unfortunately the test takes on
average 10 hours to finish.

Result: mediocre candidates desperate for a job try so hard to get everything
done, but the great engineer has plenty of options and does not want to spend
10h on a test. In the end all great people that you would like to hire quit in
the process.

~~~
ebiester
I always wonder... Would you take a job if you heard 20-40% of people who
accepted the job were fired within the first month?

If an organization was good at firing fast, would people be willing to take a
job there? Would you be able to truly assess an engineer within a month in a
way you wouldn't in an hour?

The first two weeks are usually a wash. But you might be able to get more
signal in that second two weeks?

Does that same equation hold true if it's contract to hire? Would you take
such a job?

~~~
thedufer
I mean, we have plenty of people take ~this offer every year. The term is more
like 3 months, and we call them "interns".

For people who already have full-time jobs it seems like a much worse deal,
though. I certainly wouldn't take it, at least - it makes very little sense to
give up the certainty of my current job in exchange for being maybe unemployed
in a month.

~~~
barry-cotter
That’s absolutely not the same. An internship has a defined start and end date
and you need to do something egregious not to make it to the end. In that
sense it’s more like a short term contract than anything else and contractors
get paid a lot more than salaried employees to compensate them for the risk
involved.

Most internships are for hiring, not the labour the company gets from them.
They function as three month long interviews but unlike a short term contract
leading to hire it’s _expected_ that they won’t immediately convert into a job
as students return to university for another year. They’re also far more
opaque to other employers on a cv. If someone did internships at three
different companies over their degree they could have wanted to see many
different companies or they could have performed below expectations at all
three places. If you see their cv you won’t know.

~~~
thedufer
It still sounds awfully similar. If you're firing ~30% of hires after the
first month, then you're clearly treating it as an extended interview. And the
first month of any job (in software, at least) includes a lot of
training/ramp-up, so you don't expect to get much labor out of that period.
The main difference is just that an internship has a several-month unpaid
leave starting 3 months after hire.

I suppose it diverges more if you consider internships prior to the final one
due to the weird optionality on following intern seasons, but I think that's a
minority of internships due to the hiring goal (once you start looking at 2+
year lead-times before a potential full-time start date it becomes much harder
to justify).

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mikece
I've suggested to recruiting firms that they should hire (or retain) a couple
enterprise architects and have them meet with the technical managers looking
for developers and let these highly experienced engineers pre-interview
candidates based on the hiring company's needs and only refer people who can
pass the enterprise arch's review. The time saved by the hiring company to not
have their in-house archs, team leads, and engineers tied up interviewing
candidates should MORE than make up for the premium such pre-interviewing
would demand.

(Something else that would help is paying employees a lot more than $500 for
making an in-house referral. I know of cases where locally where in-house
referrals could have happened but by referring through a chosen recruiter got
the referred a $1000 referral fee instead of his company's $500 referral
fee... but that's a separate rant.)

~~~
ghaff
Internal referrals are great. The problem is that, if you increase the fee too
much, it's going to get harder and harder for employees to prioritize
referring someone they know would be a great fit for a position (and get a
nice spiff in the process) versus randomly referring people they vaguely know
on the off-chance they'll get a multi-$K payout.

~~~
hak8or
I've never seen a referral bonus come without a requirement of te new employee
staying at least 6 montha or a year.

~~~
ghaff
In most places, less than 6-12 months implies a pretty serious mismatch of
expectations of some sort.

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robocat
Why use the cost of an engineer hour?

The correct metric is the opportunity cost of that hour - the lost
productivity for that hour.

As an approximation take total revenue and divide by total engineering hours.

If you are hiring engineering because engineering is a bottleneck (not just
hiring due to churn), then the metric is realistic. It would still be an
underestimation in his calculation because he isn't including the hours taken
to get new hire up to speed (oppositely assuming hire is due to churn).

~~~
onion2k
_As an approximation take total revenue and divide by total engineering
hours._

This does assume every hour spent on engineering is equal, and that's not even
close to true. In most companies about 50% of the hours account for 99% of the
revenue. Companies spend _lots_ of time on things that don't make any money,
and in some cases they knowingly spend time on things that lose money.

If you can identify the waste then you can _easily_ find engineering time to
spend on things like hiring with no impact on the bottom line at all.

~~~
jiveturkey
> This does assume every hour spent on engineering is equal, and that's not
> even close to true. In most companies about 50% of the hours account for 99%
> of the revenue.

Yeah, the other 50% is interviewing. :P

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gumby
Don’t forget the candidate’s time as well. You should only bring them onsite
if you think (from phone’s screen etc) they’re probably worth hiring so if
they don’t work out you should be improving the upstream screening for
everyone’s benefit.

~~~
rexpop
Why should a company value candidates' time?

Edit: To be clear, corporations are morally bankrupt slow AI whose goals are
increasingly tangential to ours. However, their proponents must have _some_
justification for valuing what we value (in this case, candidates' time), or
else admit the above moral bankruptcy.

I am not being sarcastic, I am challenging this forum's many corporatists to
reassure me that corporations are motivated to accommodate a basic decency
represented by valuing candidates' time.

Downvotes on a simple question, as usual, evidence this forum's continued
inadequacy as a harbor for empirical discussion.

I am not trolling, nor sarcastic. I am simply ignorant of the corporatist
argument for valuing candidates time.

~~~
pfranz
Depending on the other options your candidate has, you could be filtering out
the best candidates. You could also ruin the company's reputation.

I've seen close friends have all-day interviews, or require spec work
(requiring higher end hardware and a couple days of dedicated work) as part of
the interview process. Peers blow off those companies or knock them down a
tier when seeking work.

Just having an all-day interview can make scheduling way more difficult,
delaying it until that other job with a 2-hour interview has happened and
moved onto negotiating benefits.

~~~
rexpop
> Peers blow off those companies or knock them down a tier when seeking work.

Unless I am mistaken, this only happens when candidates' experiences are
shared, and only impacts business decisions if shared widely.

~~~
pfranz
The situation is I apply to 4 jobs, 1 requests spec work requiring a couple
days of dedicated time while the rest are happy with what's in my portfolio.
That 1 job is less of a priority compared to the others.

The same applies to 8 hour interviews or multiple interviews. It might not be
common place, but I've learned to ask upfront about the start-to-finish hiring
process.

I'm not saying its unwarranted or even a hidden cost to the business--just
that it raises the burden and likely will filter out qualified candidates. I
do think networking and shared experiences you mentioned should be thought
about. That's often the best/cheapest way to get qualified candidates (why
referral bonuses are a thing). If candidates are telling each other informally
or on something like GlassDoor how onerous the interview process is, you have
to compensate by reaching out with things like ads and job fairs and do the
filtering yourself.

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maxxxxx
I don't think that time is very hidden. You have to sift through a ton of
resumes and then spend hours and hours interviewing and phone screening. If
you have actual work to do it's pure misery. I also don't have time to really
think about my interviewing technique.

I would much prefer if we had a "hiring department" who are technically
knowledgeable, talk to applicants, maybe give them tests and build up a pool
of candidates who then can be interviewed by the actual engineering teams.

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speedplane
A bigger question about recruiting and engineer time, is whether they are
effective at weeding out unproductive candidates. I'm not a recruiter, but I
have interviewed a number of folks, and I still find it very difficult to
determine if someone is good or bad. Folks that sound good during the
interview, may just be good at communicating ideas, which is an important
trait, but is still just one trait.

Even after you hire them, and you see them under-perform, it can be difficult
to know if it's because of some intrinsic problem (e.g., just not so smart, or
laziness), or if the problem is with the employer (e.g., not managing work,
lack of communication, poor team integration). Yes, there are obvious stars
and duds, but the middle is a vast gray area.

As engineers, we naturally try to turn hiring and performance assessment into
an analytical questions that have clear answers, or that at least can follow a
clear process. However, it still seems like voodoo.

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e_ameisen
Great article! Add to it the moral cost of interviewing multiple subpar
candidates and improving the fit of candidates at the top of the interview
process has a huge impact.

This is one of the reasons that many companies work with us at Insight
(insightdatascience.com), as the interviews to join the program are done by
Data Scientists and Engineers.

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diNgUrAndI
Sometimes interviewing a candidate as a team can have small benefits such as
strengthening / making explicit what values are important to the team among
the participants. This assumes that the team is operating in a full
transparency, which is often seen in a small startup. I had the experience
that after being eng. interviewer a few times I felt more glued and aligned
with the team.

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Justsignedup
To be fair... $150 an eng hour? That's a 312k salary. I don't think that is
accurate. And a recruiter makes 200k salary on average?

These numbers are a bit nuts.

Agree with a lot of what is written tho, but not this crazy number.

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dasil003
It's not a $312k salary unless the person takes no holidays, sick days,
vacation and has no benefits or other fixed costs associated with their
employement.

~~~
mouldysammich
Are holidays and sick days not paid in the US?

~~~
abrugsch
Often not unless they are negotiated or the company is really pushing it's
work/life balance as a job perk

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village-idiot
Hiring manager here: we talk about the opportunity cost of interviewing a lot.

