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How to interview key hires II: Behavioral interviewing September 10, 2008

Posted by jeremyliew in hiring, HR, interviewing, start-up, startup, startups.
2 comments

Recently I posted about how to interview key hires, focusing on the three areas to test a potential hire on:

1. Technical Skills
2. Cultural Fit
3. Performance Skills

Technical skills and cultural fit are relatively easy to interview for (although you may need to borrow advisers or friends with the technical skills of the function that you are hiring for to help you with the interviewing).

Performance skills tell you how well they can do a job. These include characteristics such as attention to detail, problem solving, initiative, leadership and team work. I have found that behavioral interviewing is the best way to test for performance skills. From SUNY Brockport:

Behavioral interviewing is a style of interviewing that was developed in the 1970’s by industrial psychologists. Behavioral interviewing asserts that “the most accurate predictor of future performance is past performance in a similar situation.”… Behavioral interviewing emphasizes past performance and behaviors.

First and foremost, it is important that you and your co-founders and other key leaders in the company agree on what performance skills you are testing for. While ideally you would like all your key hires to be great at everything, there are likely a set of 3-5 performance skills that are critical. For example, someone in a sales role might need to have a strong customer focus, an ability to influence and persuade, experience negotiating and good relationship management skills. A product manager might need to have high attention to detail, product vision, skills in working across functions and expertise at planning and prioritizing. Agree on what performance skills are important in advance.

Once a short list of performance skills has been created, each interviewer should develop a different question to ask the candidate about this performance skill. These questions should focus on asking about specific past experiences and outcomes. For example, if the performance skill being tested was initiative, questions [and interpretive guides] could include (with a credit to Novation’s SkilAnalyzer):

Tell me about a situation in which you aggressively capitalized on an opportunity and converted something ordinary into something special. [Did the candidate put a unique twist on a routine situation to yield positive results? Was there an accomplishment of little magnitude or that should have been expected of anyone in that situation?]

Describe something you’ve done that shows how you can respond to situations as they arise without supervision. [Did the candidate take reasonable and quick action with an appropriate amount of information or research, warranting the independence? Was there use of authority inappropriately, excess procrastination, or a bad decision?]

Think of a slim sales lead that you converted into a big sale. How did you do it? [Did the candidate follow up on a lead that offered little chance of success, and move it to a success level that justified the effort? Was there a trivial effort, possibly with insignificant rewards?]

Described a time when you voluntarily undertook a special project above and beyond your normal responsibilities. [Did the candidate volunteer for a task despite an already full workload and succeed without undue compromise to other responsibilities? Was there an insignificant addition, or sacrifice of other areas?]

Many people have good ideas, but few act on them. Tell me how you’ve transformed a good idea into a productive business outcome. [Did the candidate generate a meaningful action plan to bring the idea to reality? Was there a haphazard, unrealistic, unproductive transformation?]

Tell me about a time when you anticipated an opportunity or problem and were ready for it when it happened. [Did the candidate prepare an approach that would be ready to launch upon the event’s occurrence? Was there a slow trial-and-error response to the event, and resulting in only modest benefits?]

For these or any other questions that you ask, make sure that you keep the candidate talking about a single, specific instance that occurred in the past. Don’t let a candidate talk about generalities (“I always like to …”), or about how they would react (“If I got a sales lead like that I would…”). You are looking for a simple structure: Situation; Action; Outcome. Make sure that you get all three in detail.

Probe carefully to understand who was involved in decisions and what was the candidates work versus the work of people around them. Press on any instance of “we” to see what exactly the candidate did, versus what her team mates, reports or boss did. And make sure you know what impact their actions had, whether positive or negative, major or minor.

It is hard to make up stories about past experiences. That is why behavioral interviewing works so well. You’ll be surprised just how much a candidate will tell you, and how much it tells you about them, when you follow this approach.

If you don’t “get” Facebook and Twitter, read this NY Times article September 8, 2008

Posted by jeremyliew in facebook, microblogging, social media, social networks, status, twitter.
38 comments

The NY Times is often considered the US newspaper of record, and it lives up to its reputation with an excellent article in today’s Sunday NY Times Magazine about the ambient awareness enabled by Facebook status updates, Twitter and other microblogging tools.

Even readers familiar with both popular microblogging tools and their history should read this article. High points:

Microblogging enables ambient awareness of your broad friendship group:

In essence, Facebook users didn’t think they wanted constant, up-to-the-minute updates on what other people are doing. Yet when they experienced this sort of omnipresent knowledge, they found it intriguing and addictive. Why?

Social scientists have a name for this sort of incessant online contact. They call it “ambient awareness.” It is, they say, very much like being physically near someone and picking up on his mood through the little things he does — body language, sighs, stray comments — out of the corner of your eye.

Ambient awareness comes not from any single tweet or status update, but from the aggregation of the data.

Haley discovered that he was beginning to sense the rhythms of his friends’ lives in a way he never had before. When one friend got sick with a virulent fever, he could tell by her Twitter updates when she was getting worse and the instant she finally turned the corner. He could see when friends were heading into hellish days at work or when they’d scored a big success. Even the daily catalog of sandwiches became oddly mesmerizing, a sort of metronomic click that he grew accustomed to seeing pop up in the middle of each day.

This is the paradox of ambient awareness. Each little update — each individual bit of social information — is insignificant on its own, even supremely mundane. But taken together, over time, the little snippets coalesce into a surprisingly sophisticated portrait of your friends’ and family members’ lives, like thousands of dots making a pointillist painting. This was never before possible, because in the real world, no friend would bother to call you up and detail the sandwiches she was eating. The ambient information becomes like “a type of E.S.P.,” as Haley described it to me, an invisible dimension floating over everyday life.

“It’s like I can distantly read everyone’s mind,” Haley went on to say. “I love that. I feel like I’m getting to something raw about my friends. It’s like I’ve got this heads-up display for them.” … And when they do socialize face to face, it feels oddly as if they’ve never actually been apart. They don’t need to ask, “So, what have you been up to?” because they already know. Instead, they’ll begin discussing something that one of the friends Twittered that afternoon, as if picking up a conversation in the middle.

“It’s an aggregate phenomenon,” Marc Davis, a chief scientist at Yahoo and former professor of information science at the University of California at Berkeley, told me. “No message is the single-most-important message. It’s sort of like when you’re sitting with someone and you look over and they smile at you. You’re sitting here reading the paper, and you’re doing your side-by-side thing, and you just sort of let people know you’re aware of them.” Yet it is also why it can be extremely hard to understand the phenomenon until you’ve experienced it. Merely looking at a stranger’s Twitter or Facebook feed isn’t interesting, because it seems like blather. Follow it for a day, though, and it begins to feel like a short story; follow it for a month, and it’s a novel.

Ambient awareness helps maintain “weak ties”. Sociological research has shown that a large network of weak ties is more likely to be helpful than a small network of strong ties when trying to do things like get a job, find a mate, and other socially tinged objectives

Many maintained that their circle of true intimates, their very close friends and family, had not become bigger. Constant online contact had made those ties immeasurably richer, but it hadn’t actually increased the number of them; deep relationships are still predicated on face time, and there are only so many hours in the day for that.

But where their sociality had truly exploded was in their “weak ties” — loose acquaintances, people they knew less well. It might be someone they met at a conference, or someone from high school who recently “friended” them on Facebook, or somebody from last year’s holiday party. In their pre-Internet lives, these sorts of acquaintances would have quickly faded from their attention. But when one of these far-flung people suddenly posts a personal note to your feed, it is essentially a reminder that they exist.

Microblogging, ambient awareness and maintaining weak ties has the sideeffect of making it impossible to move away and “reinvent yourself” as your past will always be with you.

This is the ultimate effect of the new awareness: It brings back the dynamics of small-town life, where everybody knows your business…

“It’s just like living in a village, where it’s actually hard to lie because everybody knows the truth already,” Tufekci said. “The current generation is never unconnected. They’re never losing touch with their friends. So we’re going back to a more normal place, historically. If you look at human history, the idea that you would drift through life, going from new relation to new relation, that’s very new. It’s just the 20th century.”…

“If anything, it’s identity-constraining now,” Tufekci told me. “You can’t play with your identity if your audience is always checking up on you. I had a student who posted that she was downloading some Pearl Jam, and someone wrote on her wall, ‘Oh, right, ha-ha — I know you, and you’re not into that.’ ” She laughed. “You know that old cartoon? ‘On the Internet, nobody knows you’re a dog’? On the Internet today, everybody knows you’re a dog! If you don’t want people to know you’re a dog, you’d better stay away from a keyboard.”

Again, read the whole thing.

Being wise versus being smart September 4, 2008

Posted by jeremyliew in Entrepreneur, start-up, startup.
5 comments

Great post today from Sim Simeonov about being wise vs being smart that I’ll quote in its entirety since it is so short:

There is a set of interrelated concepts I’m fond of reminding entrepreneurs about but I’ve never found a really good way to summarize them into a sentence that conveys the right meaning and tone. Here are various renditions:

* Be different, not best
* Do less, not more
* Go around a wall, not through it
* It is better to figure out how not to have to solve a problem as opposed to having to solve the problem.

A while back I was talking to my friends at Kaltura about this and CEO Ron Yekutiel told me about a saying he’d heard about the difference between smart and wise people.

The difference between a smart person and a wise person is that a wise person knows how not to get into situations that a smart person knows how to get out of.

Free to play game best practices are the same as game best practices, only moreso September 3, 2008

Posted by jeremyliew in digital goods, game design, game mechanics, games, games 2.0, gaming, virtual goods.
1 comment so far

It has often been said that good games are easy to learn and hard to master. At this years Penny Arcade Expo, Jamie Cheng (CEO of Klei Entertainment, who are the developers for Sugar Rush, Nexon’s first “built for built for North America” free to play title) notes that these principles are even more important for free to play games:

With a free-to-play game, a positive initial experience is crucial. Cheng recently played Jonathan Blow’s Braid, and very early in the game came upon a puzzle that was so frustrating he put the game down. His main motivation for returning and giving it another shot, after which he very much enjoyed it, was that he had already paid for the title.

Free-to-play games don’t have the luxury of player obligation, he says, because they haven’t made a concrete monetary investment. Games that don’t immediately grab players simply won’t be played.

For a similar reason, games need to have depth and complexity beyond their approachable entry point — after all, free-to-play games are only monetized if players keep playing them, as opposed to retail games, which are monetized as soon as the player buys them. “If nobody spends their time, we’re not going to make any money,” Cheng says.

By extension, a social experience is crucial in creating the word-of-mouth marketing that will allow the game to reach a long-term dedicated audience.

“For example, I’ve bought probably 40 additional tracks for Rock Band, as well as the N+ cooperative levels. I bought those not just so I can play by myself, but so I can play with my friends,” he says.

Longevity is also key: “We’re not trying to build a grindfest, we’re trying to build a game that grows and evolves with you,” Cheng explains.

Some social games such as Friends for Sale (a Lightspeed portfolio company) and (Lil) Green Patch take this to such an extent that many new players don’t even realize that they are playing a game, but think of the app as a lightweight communication tool. But over time thanks to smart application of game mechanics, a hardcore player base develops. Traditional and casual game designers should take note.

Facebook selling digital gifts at a $35m run rate September 2, 2008

Posted by jeremyliew in business models, digital goods, facebook, gifts, virtual goods.
121 comments

In January of this year, we estimated that Facebook was selling digital gifts worth $15m per year. We based this estimate on an analysis of the number of each gift available each week over a 7 week period.

Facebook creates a certain fixed number of each type of gift. When the number remaining for any particular gift drops below 100,000, Facebook displays the number left. (The most common size runs are 100,000 and 1,000,000 but they range as high as 10,000,000 and as low as 15,000.). For those items where less than 100,000 remain, we can track how many gifts had been sold in the preceding week by subtracting the number remaining from the number remaining the previous week.

We updated the analysis this month and found that Facebook has dramatically increased its sales rate of digital gifts. As before, we tracked the number of digital gifts available of each type (where data was available). We ordered the items by bestselling (as defined by Facebook) and, because data is sparse, we divided the list into groups of 20, took the average of each group of 20 items and applied that sales rate to all items in each group.

Once we excluded the free gifts, the averages looked like this:

By multiplying each average by 20 and adding the totals we came up with virtual gift sales of between 390,000 and 600,000 per week, with an average of around 470,000 across the three weeks.

The vast majority of facebook gifts are bought from the first screen of gifts in the directory – almost 80% of the total sales come from the group of the first 20 gifts. This points to the self reinforcing nature of popularity (the crowdiness of crowds rather than the wisdom of crowds) when popularity data is made public.

We need to take into account seasonality. In most retail environments, something like 40% of sales occur in the last 8 weeks of the year. Judging from the high number of holiday themed gifts over the holiday period last year, the same seems to be true of Facebook:

Holiday themed gifts (e.g. Santa hat, eggnog, Happy New Year!) dominated the list of top selling paid gifts, averaging 4,755 sales per week.

If we apply this assumption to our weekly average sales numbers, we multiply by 73.3 (instead of 52) to get to an estimate of annual sales. Using this estimate we get a range of between 28,500,000 and 43,500,000 in annual Facebook gift sales, with an average around 34,500,000.

Unfortunately however, as only one item in the first 20 had “number left” data available each week (Bear Hug), this also makes our estimate prone to significant error. Bear Hug was consistently around 6 or 7 among the most popular gifts, behind most of the birthday gifts, so hopefully it approximates the average popularity of the top 20. Applying 25% uncertainty to the average of the top 20 bestselling gifts creates a similar range of between 28,000,000 and 42,000,000.

In both cases, these estimates are double the number that we estimated at the beginning of the year which was around 15,000,000 digital gifts. That estimate was based on data drawn during the holidays and may have been high on a run rate basis.

Given that Zuckerberg has estimated that Facebook will do between $300-$350 million in revenue this year, digital goods constitutes a meaningful secondary revenue stream for the company.

Using a virtual world newspaper to enhance in-world community September 1, 2008

Posted by jeremyliew in culture, mmorpg, newspapers, virtual worlds.
4 comments

The LA Times notes the popularity of the Club Penguin Times:

The Club Penguin Times … is more widely read than New York’s Daily News, the Chicago Tribune or the Dallas Morning News. And it’s not even 3 years old.

But this weekly “newspaper” isn’t tossed onto driveways or sold at newsstands.

Rather, it’s an online publication distributed to the estimated 6.7 million monthly users of Club Penguin, a snow-covered virtual world visited by more than 12 million kids, who adopt a colorful penguin persona and waddle around, playing games and meeting new friends.

Though no one would suggest that the Club Penguin Times provides Pulitzer Prize-worthy coverage, it nonetheless attracts 30,000 daily submissions from children, who pose questions to Dear Abby-inspired “Aunt Arctic,” compose verse for the poetry corner, tell a joke or review a party or event…

As the main source of information about events within Disney’s icy, penguin-populated virtual world, it boasts the kind of reader penetration that mainstream newspapers would envy. At least two-thirds of the players turn to the Times each week to find out what’s happening, Merrifield estimates.

Club Penguin’s CEO., Lane Merrifield, notes:

…he was looking for ways to incorporate learning — what he called educational “fiber” — in the game. Publishing a “newspaper” seemed an obvious way to encourage reading by offering information that users care about, such as the latest igloo upgrades.

In addition, the Club Penguin Times helps create social norms and shared experiences for players – an important facet to creating and shaping a culture in the world. Most online worlds develop discussion boards where the world’s creators have limited ability to shape the discussion. By creating a user generated (but company edited) newspaper for the world, the world’s creators give themselves a powerful tool for controlling and shaping the conversation. People building MMOGs and virtual worlds should read the whole thing.

(Found via via Paid Content.)