A SERIES OF FORTUNATE EFFICIENCIES
Background: The U.S. Government had contracted a private security firm to provide armed guard services to a diplomatic compound being used to house U.S. personnel in Sana'a, Yemen. The original contract was up for renegotiation at the time our team was asked to assume the leadership of the guard force.
Issue: The private security firm had doubled the renewal price of the contract, which would have meant that the U.S. Government would be spending nearly the same on a group of 100 guards ($6,000,000) as they would would on the rest of the 350 person guard force ($8,000,000).
The math heavily favored bringing these additional guards in-house. However, the timing of the situation did not. With only 60 days left on the original contract, we had a very tight window to advertise for the positions, screen and hire applicants and then train them. Complicating matters, we were told that it would be at least a 6-month process, from an HR standpoint. This meant that we would still need to continue with the existing private firm on a month-to-month basis without a contract. Those "holdover" payments on the existing contract would total $1,500,000 per month. There were no other firms we could contract with in the interim.
We needed to hire and train approximately 100 qualified individuals while adhering to all applicable Yemeni and U.S. labor laws. We needed to accomplish this within 60 days.
Insight: Our team analyzed this situation and created a process map. It was clear that the bottleneck was in HR. They were insistent that the process could not be shortened because of two main reasons. The first, they had very limited staffing. The second, it would take a great deal of time, effort and energy to locate qualified individuals to take these positions.
Our team developed the following theory based on data. We didn't know know exactly what the salary rates the private security firm paid their guards but we did have access to the disciplinary records. From the disciplinary records we saw that there were many repeat offenders. This was odd to us. Why? Because under the terms of the contract, for every disciplinary infraction the U.S. Government was allowed to deduct a certain dollar amount from the contract payment as a fine. The payment was not insubstantial. So it was odd that many guards were being allowed to continuously cause losses for their employer. Odd, unless there was another reason.
Our team reasoned that the reason the salaries of the guards must have been so low but the margins on the contract so high, that it was cheaper for the private firm just to pay the fine rather than find another qualified individual willing to work for that price.
We then came up with a model to approximate what the private firm paid their guards and our most conservative estimate was that the U.S. Government would pay double. This doesn't even account for the job security and other benefits that came with a permanent position.
Our solution was right in front of us, we wouldn't need an extended advertisement period. There was already a large pool of qualified applicants in our midst.
So that insight helped alleviate the issue of needing to advertise the positions for long periods of time. HR agreed agreed with our logic, and we were able to only advertise for a 2 week period. We received over 5,000 paper applications within that period.
Strategy: The local HR staff was adamant that it would take months for the applications to be sorted and culled because they were understaffed. The normal process was two-fold, it was designed to prevent undue influence. The first cull would be done by HR to insure that the applicants were qualified. The second cull would be done by our team from those applicants that were deemed qualified. The local HR staff argued very forcefully that we could not speed this process up.
Our team disagreed and the head of HR who was an American officer, agreed with our logic. If the purpose of HR was to prevent undue influence, we could have identifying information of the applicant blacked out, while our team would assess the application on its merits without knowing who the individual was.
This strategy cut the pool from 5,000 applicants to 1,000. With the final 1,000 applicants, our team devised a model based on a totality of culturally relevant data. We wanted to find a proxy for both veracity and skill. Something easily verifiable that could be used to sort through many applicants. We decided to focus on English language ability, which would normally be tested during the interview. We reasoned that if an applicant claimed fluency but could not speak that there would be other inconsistencies with the application.
So we began marathon phone sessions to call the 1,000 applicants. Within 30 seconds we were able to ascertain the approximate level of fluency of each applicant and confirmed that many had vastly overstated their ability. By the end, we had narrowed the pool down to 180 applicants. As an aside, we found that the applicants who were most comfortable with not claiming a high degree of English fluency were extremely well qualified on hard skills and relevant experience. Those individuals were also invited to interview.
So by week 3, we had our pool. We still had 5 weeks before the contract was up and we were very ahead of schedule.
Over the next 3 weeks we conducted 180 interviews lasting anywhere from 40-80 minutes designed to fully test applicants. It was during this time that our team discovered the real reason behind HR's initial intransigence regarding our hiring methods. Our team consisted of a member who spoke Arabic, but he did not make this known. As a result the local HR staff did not realize that when they interpreted an applicant's speech from Arabic to English, that our team member actually knew what was being said.
Our team member discovered that for certain applicants, the local HR staff would provide radically different answers that would be far better responses to the questions posed than what the applicant had come up with on their own. Never before had an American involved in the hiring process spoken Arabic with such a high level of fluency.
Our team was then tasked with investigating how long this had occurred and the full ramifications. We reasoned that applicants had some sort of family or personal connection and we went through 20 years worth of hiring records and employee files to map out the extent of the fraud. To add insult to injury, many of these employees that were hired with assistance of HR had some of the highest disciplinary incidents.
Outcome: Our teams efforts led to multiple successful outcomes:
The hiring and training of the 100 guards ahead of schedule saving $6,000,000 in contract extension costs.
Uncovering a long-standing fraudulent practice by local HR staff members to aid friends and relatives that had cost over $1,000,000.
Leaving a blueprint behind for how other sections could utilize our hiring efficiencies for their own staffing needs resulting in a permanent reduction in the time required to onboard a new employee.