After some of David Shulman’s friends lost almost everything to financial swindler Bernard Madoff nearly a decade ago, it made him wonder how well we know the people around us, especially at work.
Could the financial analyst in the next cubicle turn out to be the next criminal mastermind? Is your work lunch buddy a natural-born deceiver? How well does any company know its employees?
To answer his own questions, Shulman, who has an economics degree and 30 years of experience as an executive with Wall Street capital firms, set out to design a test to find out. Like a lot of personality assessments, he hoped it would offer insights into what made someone tick. To help develop it, he brought in behavioural and psychometric scientists.
To set a yardstick, Shulman started out by giving a prototype of the test to some of the worst among us—convicted criminals. The company he created, Veris Benchmarks, tested 812 white-collar criminals who had been convicted of 1,724 different offences, including forgery, embezzlement, and fraud. Then Shulman’s company gave the test to thousands of ordinary businesspeople, which provided a standard for “normal responses.”
While the businesspeople scored lower or higher on things like truthfulness, in comparison, the criminals scored uniformly worse in accountability, conscientiousness, and empathy.
Most of the time, we determine whether we think someone is honest by our impression of them, for instance, by asking a series of questions during the hiring process, or by how they conduct themselves during everyday business dealings. But, that’s not foolproof.
“Talking to someone directly, and then bringing them on board because you like the way they answer questions is a dangerous way to hire someone,” says Shulman. “There’s simply no science that supports it.”
In the past three years, Nilan Peiris has been involved in hiring more people than most of us will ever work with. His company, money transmission firm TransferWise, has grown from 60 employees to 700 in that time. And nearly every one of them has told at least a little white lie, he says. Spotting these isn’t so hard, according to Peiris.
The most common one is when the candidate is asked why they’d like to work for TransferWise, Peiris said from London, where he serves as the company’s vice president of growth. “People usually say it’s because they’re passionate about money transfer,” Peiris says. “And I say, ‘OK, that’s not true. What’s the real reason? Because I’m not passionate about money transfers, and neither are the founders, and neither is anyone else here.”
Maybe the real answer is that they want to work at a fast-growing company, or in the tech industry, or a hundred other reasons. But Peiris says the point of catching them in this untruth is to see how they react. “If they’re able to open up and be honest with us, then that tells us that they’re ready to go on to the next step,” Peiris says.
True honesty from anyone simply isn’t the reality, says Peiris, who suspects he has never actually seen a CV that doesn’t at least exaggerate a little bit.
There’s also the issue of lying by omission. Perhaps you have a gap on your CV, —you may have spent time away from the workforce to go travelling or to start a family— so you might exaggerate the importance of the part-time job you had during that period. It might be a half-truth, but Headley says many people would see that as worth the risk and common practice.
“Rather than trying to suss out people for whether they’re a liar, figure out if they’re someone who can do the job,” Headley says.