“He just didn’t work out.”

Hardly a day goes by that I don’t hear about a company’s hiring mistake. “He had great experience and industry knowledge, but he just didn’t work out.” Or at a social media company in NYC, a VP departs after just 90 days. Another one bites the dust. I hear this over and over and over.

Why is this happening? Why do companies continually make hiring blunders repeatedly? Despite resumes, face to face interviews, reference checks, and credit scores. Why does such due diligence keep failing?

My conclusion: They’re looking for the wrong things.

To analyze the reasons why, let’s examine a concept from Blue Ocean Strategy of Pioneers, Migrants and Settlers.

Before we examine those three personality types, it is useful to first explain what Blue Oceans means.

Blue Oceans are uncontested market space, while Red Oceans are hotly contested spaces. For instance, in the early car industry, cars were custom-built and very expensive. To compete in a Red Ocean, you custom build a car and maybe try to cut the price a bit. But Henry Ford used a different approach. Using an assembly line, he cut the manufacturing time from four days to four hours and used standard parts. Henry Ford famously said “If I asked my customers what they wanted, they would have said a faster horse.“

Red Ocean companies compete in a zero sum game - to grow, you take market share from your competitor. Blue Ocean companies focus on the demand size, competing on value to win non-customers. Henry Ford went after the horse and buggy crowd, not the early adopters.

Most companies live in Red Oceans but a handful of successful companies find and compete in Blue Oceans.

Another good example of Blue Ocean strategy is Cirque du Soleil. Think of the standard view of a circus. 3 rings, animals, clowns, etc. If you do a new circus, do you have better animals or clowns, and target children -  to take business from Ringling Brothers/Barnum and Bailey?

Cirque due Soleil used a different approach. Rather than competing against circuses, they competed against other entertainment options, like Broadway shows, concerts and fine restaurants.

The book says they “very successfully entered a structurally unattractive circus industry. It was able to reinvent the industry and created a new market space by challenging the conventional assumptions about how to compete. It value innovated by shifting the buyer group from children (end-users of the traditional circus) to adults (purchasers of the traditional circus), drawing upon the distinctive strengths of other alternative industries, such as the theater, Broadway shows and the opera, to offer a totally new set of utilities to more mature and higher spending customers.”

Now that we know what Blue and Red Oceans mean, we can go back to the personality types of Pioneers, Migrants and Settlers.

The authors point out that the skills needed to think outside the box belong to Pioneers. Only innovative risk takers can create the dramatic changes needed to find Blue Oceans. Migrants are less desirable, but if properly coached, they can become Pioneers. The least desirable by far is Settlers. - those risk adverse task-completers. The authors of the book advise avoiding Settlers. Their recommendation? Hire Pioneers.

Unfortunately, our entire hiring approach is designed to weed out Pioneers and hire Settlers. Case in point, one vendor of backup software insisted all candidates for a senior marketing position have experience in backup software. Not software. Not innovation. Not results.

Who fits? A Settler who has worked for the same backup software company for years and years. Do they bring fresh ideas and innovative insights?  Certainly not.

Companies inability to find and recruit Pioneers is the main reason for repeated failures.

The problem is two-fold:

1. Hiring managers don’t know how to find Pioneers in a pile of resumes
2. Hiring managers don’t know the right questions to ask in the interview

Here a few tips to help hiring managers identify Pioneers:

• Pioneers are risk takers. They start companies and often fail, but keep getting back up. Look for signs of self starting and resiliency in resumes.
• Pioneers are action oriented. They learn new things continually. They are voracious book readers. Ask about things they have learns and what books they read.
• Pioneers are fearless. They take on any challenge. Look for signs this person took chances and assumed responsibility.

Keep those tips in mind for the next job your company posts.

What do you think? Do you see Pioneers, Migrants and Settlers? Are companies struggling to identify personality types? We love comments and reTweets too.

Jeff Ogden is President of Find New Customers “Demand Generation Made Simple”  Find New Customers helps companies rapidly grow revenue by transforming how they attract, engage and win new customers. Contact Find New Customers by calling (516) 495-9350 or send an email to sales at findnewcustomers.com.