Why hiring in a new market means going against human psychology

Hiring is a tricky thing, no matter who you are and what the role is. But it’s even harder when you’re a startup founder and you’re making a key hiring decision in a new market . You can’t afford to make any personnel mistakes this soon, especially when runway is limited and potential investors are gauging your execution on a promising new source of growth.

Photo credit: Fakurian Design

With globalization and the advances in technology, the opportunity to enter another market has never been available so early for startups, magnifying the importance of getting things right as a growing firm.

But often, we as leaders and organizations fall into a few pitfalls that can disproportionately impact our hiring decisions in new markets.

Humans hate uncertainty

You’re expanding into a new market ,  a market that you’ve perhaps visited many times before and whose people you’ve worked with and partnered with in the past. But let’s face it: If we’re being honest, when it comes to truly understanding the market, we can’t hold a candle to a native. And that’s totally OK.

You might be thinking it’s possible for you to assess the uncertainty of the market, think of all the ways you might be wrong, all the ways you might fail, and all the ways you could hire the wrong people, and come up with a course of action which maximizes your expected return, right?

Unfortunately, that’s just not the way we are wired.

Humans hate uncertainty. A 2016 study found that our stress levels were directly correlated to the uncertainty of the outcome, rather than the outcome itself.

Not knowing how we’ll do on an exam is more stressful than being certain we’re going to fail. Receiving a call from your boss out of the blue is more stressful than knowing that she’s calling to fire you. And not knowing whether your startup will live is always more stressful than knowing it’s the end of the road.

So as humans, our instinct is to minimize this stress by suppressing the uncertainty. Despite the fact that external information is always incomplete and there are many types of uncertainties we have to deal with around hiring for a new market, in our mind, we make things easy. We need to make ourselves feel in control.

Here’s the kicker: The same study found that our performance level increases with uncertainty, which makes quashing this discomfort even worse.

In the uncertainty of hiring for a new market, we suppress the unknowns and default to something – anything – to reduce the stress and give us some sense of control. We then decide to hire the “smartest person,” and the smartest person, as we all know, is the one who most agrees with you ,  the one who conforms to your ideology the most.

That’s how ideologies come to dominate organizations: through mentoring, the feedback given to employees, and through the interview process. People who don’t agree with the ideology don’t get in the door, and those who do get in the door are constantly pushed to conform even more.

At some point, you can’t even imagine working with someone who doesn’t share the same general views. With everyone on the same page, it decreases the need for bureaucratic control and increases efficiency. That’s just one problem.

So what can we do?