Case Study

"Staffing Evaluation at Hallmark"

Hallmark, founded in 1910, is the largest U.S. manufacturer of greeting cards and the owner of Binney & Smith, the maker of Crayola Crayons. The company pursues a differentiation and innovation strategy and uses creativity and emotion to help people connect to its products, including its stationery, party goods, photo albums, home decor, collectibles, a cable television channel, and books. Privately owned Hallmark has annual revenues of over $4 billion and employs 3,200 individuals at its corporate headquarters in Kansas City, Missouri, and another 12,000 around the world. To hire quality people more consistently, Hallmark needed a tool to help it focus its staffing efforts on what is most relevant to the company—that is, on business-relevant criteria that would allow it to more consistently hire quality employees to best execute its strategy. However, Hallmark didn’t want the tool to be too complex. To launch the effort, Hallmark created a staffing index to evaluate the quality of the firm’s past hires so as to source and screen candidates more effectively. Upon hiring a new employee, the person’s line manager makes an immediate assessment of the employee’s intrinsic abilities and desirability. To avoid using complex formulas that require a specialized background to understand, the ratings are simple and focused on measuring the quality and timeliness of Hallmark’s hiring system. The possible new hire ratings are as follows: 1 = Average 2 = Above Average 3 = Good 4 = Very Good 5 = Walk-on-Water Good, After six months, the hiring manager uses the same five- point scale to evaluate whether its initial expectations have been realized. The data are used to compare new hires who consistently get top ratings with those who don’t to identify any distinguishing factors that can be used to make the hiring process more effective. According to one expert, Hallmark is on the right track by keeping its system simple and not getting too wrapped up in the numbers and by focusing on the end result of making good hires. Hallmark views the staffing index only as a means to an end and knows that ultimate staffing success will be gauged not by these metrics, but by the organization’s performance.

1. Critically evaluate Hallmark’s staffing index. What are its pros and cons?

2. What additional criteria do you think Hallmark should track, and how should it be measured?

3. Why might an employee rated “walk-on-water good” at the time of hire not live up to expectations? What can a company do to help new employees realize their potential?