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Littelfuse is an innovative, $600-million company with the premier circuit-protection brand worldwide. Finding committed, attentive and driven employees is an ongoing process at the company, and necessary for it to uphold its global leadership position. Continually raising the standard comes with every job.
To meet the challenge, it relies on a web-based, reference-assessment solution that incorporates more than 30 years of research in job competency modeling. The solution has had a dramatic impact on the company's recruitment efficiency and hiring quality.
The Situation: So Much Required, So Little Time
From offices in more than 28 countries, Littelfuse's 5,000 employees deliver products that are found in virtually every product that requires electrical energy, from automobiles to computers to industrial equipment. Yet, only in the past few years has Littelfuse raised its level of sophistication concerning its reference-assessment process.
"It's fair to say that we hadn't been doing the best job of reference checking," says Holly Stanton, human resources director for global talent and the Americas, at Littelfuse. "On rare occasions we found someone willing to tell us something about a candidate that actually made a difference. But, often we couldn't justify time spent on reference checking because it yielded little more than standard employment information."
The Solution: A Broader Reference Base and Better Data
Upon discovering the automated survey process, Littelfuse tested it internally, then piloted it on an actual applicant. After those initial trials four years ago, the company adopted the solution for a full range of positions across all functional and professional levels in the United States, Canada, Mexico, China and the Philippines. It has never looked back, and internal feedback from hiring managers has been consistently positive.
The method involves having the candidate send his or her references -- managers, peers, subordinates and business partners -- an electronic survey containing approximately 20 questions. And, because the questions are specific to particular types and levels of positions, they pertain to the skills and behaviors that correlate with day-to-day success on the job.
References respond because the electronic format is easy and because the emailed invitation comes directly from the candidate. Because sources are released from legal liability and know that their responses will be aggregated and not identifiable, they are candid in their assessments.
"Our managers are amazed at the kinds of references people give, especially as we see a lot more negative references than we had expected," Stanton says. "This may be, in part, because we had historically requested only two or three references. Our current system is set to require a minimum of five, two of whom must be managers. Candidates have had to broaden their reference-base, which tends to produce more revealing information."
The tool produces a report that displays easy-to-read bar graphs revealing a candidate's scores. "When a candidate scores low -- and sometimes horrendously low -- across most statements, it's obvious we don't have a match," says Stanton. "Because we're looking to hire the best, even if someone's report shows low scores in just one area that's critical to the job, we continue looking."
Clearly, the process is efficient. However, Littelfuse considers the true value to be in how the system influences the company's hiring choices. Since adopting the process, Littelfuse has avoided hiring about 48 low-scoring candidates -- candidates who might have otherwise been hired only to become poor performers. At an average annual salary of $83,000, this represents nearly $4 million in wages that could have been spent on employees that the company would not want to retain.
Here are more results:
* 50 percent of the 416 reference assessments provided were from managers,
* Five references responded per candidate,
* 89 percent of those references who were contacted responded,
* The reference response time was less than one day,
* 12 percent of candidates received scores showing "great developmental need," providing insight into whom not to hire.
"It's the behavioral-based questions that provide the assurance we need," Stanton says. "There's no doubt that we're making better-quality decisions, and we also feel that the objective feedback reflects better on the integrity of our selection process. It not only helps us identify the most optimal future employees, it also speaks well for the company."
Organization: Littelfuse Inc.
Primary Business: Littelfuse provides circuit-protection solutions worldwide for products in virtually every market using electrical energy, from cars to computers.
Outsourcing/Consulting Challenge: Littelfuse needed to introduce online reference checking to avoid hiring low-scoring candidates, saving nearly $4 million in salary costs.