Fortune 500's biggest gamble: Allowing gut instincts to drive hiring decisions

The "Happiness Code" examines ways that behavioral economics is being used to help individuals reinvent the way they approach everyday and long-term problems with applied-rationality techniques that allow a person to optimize their way of tackling long- and short-term challenges and problems.

What I appreciate about the thinking is that it applies what we know to be true about human behavior and thought-processes, offering a fresh set of practical strategies to make visible the mind's blind spots that drive unintended consequences.

Take the challenge of hiring the best talent for open positions. Right now, the process is driven by individual instinct and ability to relate to the candidate. As the article suggests, we rely on innate responses that are as old as evolution itself, tending to hire people like ourselves as a result of a millennia-old instinct that if someone didn't look like us, they might be a tiger and eat us. This threat no longer stands, and yet has been baked into our decision-making processes. Because of this, hiring managers overvalue things like hobbies or where someone grew up over talent and ability to do the job, and in so doing, put their own comfort level above the company's need to hire the best possible person for the job.

We are quick to excuse this preference in hiring managers for "reminds me of me" based on the logic that it is a good risk avoidance strategy: "Because I'm doing great in this role, I should find someone like me who will in turn do great in this role." Conscious or not, this has become a ubiquitous metric for how a candidate may perform in a job, when in fact research has shown that a group of people who have very similar perspectives delivers lower innovation, lower productivity, and worse financial outcomes.

In any enterprise, the ability to optimize all hiring decisions (or not) will make the difference in which company succeeds in an increasingly global and fast-moving economy.

While I have no personal experience with Center for Applied Rationality (CFAR), I can say with certainty as a successful tech entrepreneur who has sold a company for hundreds of millions to a Fortune 100 company that technology that optimizes individual decision-making will change the face of hiring and in so doing, make companies more competitive and successful.

Instead of sending our workers to four-day intensive workshops like the one described in "The Happiness Code," why can't software refocus people on the relevant aspects of decision making? We already know what is relevant: aptitude, propensity and ability to do the job. Technology can focus hiring managers on these things while distracting them from a particular image (usually their own likeness) of what they see as the "ideal" candidate.

After all, leaving talent acquisition up to the chance thought processes of managers is the equivalent of gambling with any successful company's core asset: its people.