Everything You Need to Know About Topgrading

Did you know that traditional hiring methods fail nearly 50% of the time, leading to costly mistakes and wasted resources? Studies have shown that more than 80% of employees’ decisions to quit a job are caused due to other employees. This means that hiring the wrong people costs you money to replace them and increases the risk of losing your top performers.

A bad hire doesn’t just impact finances—it disrupts team morale, productivity, and long-term growth.

To address these challenges, HR departments can adopt Topgrading, a structured recruitment process designed to identify and retain top talent.

This approach is a game-changer for HR management, enabling organizations to hire individuals who align with their work environment and meet compensation and benefits expectations.

Understanding Topgrading

Topgrading emerged in the 1990s when Brad Smart, a renowned expert in human resources, created it to address common hiring challenges. Brad Smart, working as a consultant for global corporations, noticed a recurring problem: traditional hiring methods often resulted in poor fits for critical roles. 

He introduced Topgrading as a rigorous, systematic approach to identify and hire “A Players,” individuals who consistently deliver superior results. His groundbreaking book Topgrading: How Leading Companies Win by Hiring, Coaching, and Keeping the Best People became a blueprint for businesses aiming to improve hiring accuracy and employee retention.

Core Philosophy of Topgrading

Topgrading revolves around one central idea: hire and retain “A Players.” These are the top 10% of performers who contribute disproportionately to organizational success. Brad Smart believed that the quality of a company’s talent directly determines its outcomes. 

Topgrading prioritizes identifying candidates with a proven track record of success, exceptional competencies, and a cultural fit with the organization. This approach doesn’t just fill positions—it builds teams that elevate the business to new heights.

Core Elements of Topgrading

Structured Recruitment Process

Topgrading emphasizes a detailed job scorecard that outlines specific skills, responsibilities, and performance metrics. This enables HR professionals to align hiring practices with organizational goals.

In-Depth Candidate Evaluation

The method employs comprehensive work experience analysis, including chronological interviews and detailed reference checks, ensuring a thorough understanding of a candidate’s background.

Employee Benefits Alignment

Topgrading looks at more than just technical skills. It checks if a candidate fits the company culture. This helps create a good work environment. It also supports long-term employee engagement.

How Topgrading Differs from Traditional Hiring

Topgrading Interviewing Process

1. Preparation: Building a Strong Foundation

Step 1: Define the Vision

Start by clearly identifying the skills, traits, and experience required for the role. Go beyond generic job descriptions—consider department-specific needs and company culture. For example:

• What technical skills are essential?
• What personality traits align with your team dynamics?
• Are there specific achievements or career milestones you expect?

Having a well-defined vision prevents vague hiring goals and ensures consistency throughout the process.

Step 2: Develop a Job Scorecard

The job scorecard is your hiring blueprint. It should include:

• Key Responsibilities: List the specific duties of the role.
• Performance Metrics: Define how success will be measured (e.g., revenue targets, project deadlines).
• Behavioral Competencies: Include traits like teamwork, adaptability, or leadership, depending on the role.
• Weightages: Assign importance to each area so you can objectively compare candidates.

For instance, a sales role might emphasize communication skills (30%), negotiation ability (40%), and past performance metrics (30%).

Step 3: Leverage Your Network

Instead of relying solely on job boards, tap into:

• Current employees: Encourage referrals from trusted team members.
• Professional networks: Reach out to contacts on LinkedIn or industry groups.
• Past candidates: Reconnect with individuals who previously performed well in interviews.

This proactive approach often yields higher-quality candidates than traditional methods.

Step 4: Use a Work History Form

Create a detailed application form that captures:

• A chronological list of jobs and roles.
• Reasons for transitioning between roles.
• Likes and dislikes in past jobs.
• Self-assessment of strengths and weaknesses.

This form helps identify patterns in a candidate’s career and provides a foundation for in-depth interviews.

2. Interviewing: Digging Deep for Insights

Step 5: Conduct Telephone Screenings

Phone interviews allow you to:

• Verify key details from the work history form.
• Ask open-ended questions to assess the candidate’s communication style and problem-solving skills.
• Weed out those who provide vague or inconsistent answers.

Example Questions:

• “What motivated you to apply for this role?”
• “Can you explain why you transitioned between your last two jobs?”

Step 6: Administer Competency-Based Interviews

This interview is more focused and shorter, typically lasting about an hour. Use the job scorecard to frame your questions, focusing on real-world scenarios that test their skills.

Example Question:

• “Tell me about a time when you faced a difficult client. How did you handle it, and what was the outcome?”

This step highlights a candidate’s practical abilities and cultural fit.

Step 7: The Topgrading Interview

The Topgrading interview is an exhaustive, chronological review of the candidate’s career and education. It usually lasts 3–4 hours and delves into:

Educational Background: “What were your goals after graduation? Did you achieve them?”

Job History:

• “Why did you take this job?”
• “What were your key achievements?”
• “What challenges did you face, and how did you overcome them?”
• “What would your supervisor say about your performance?”
• Personal Insights: “What are your long-term career goals? What are your biggest strengths and weaknesses?”

This thorough approach comprehensively explains the candidate’s skills, personality, and growth potential.

Step 8: Gather Interviewer Feedback

If multiple interviewers are involved, convene to compare notes. Discuss:

• Common observations.
• Any discrepancies in candidate responses.
• Areas of concern or standout strengths.

This ensures a balanced and well-rounded evaluation of the candidate.

3. Verification and Post-Hire Integration

Step 9: Prepare an Executive Summary

Summarize key takeaways from the interviews, focusing on:

• The candidate’s alignment with the job scorecard.
• Areas where they excel and areas needing improvement.
• Potential for long-term growth within the company.

Use this summary to make your final hiring decision.

Step 10: Conduct Reference Checks

Ask the candidate to arrange reference calls with:

• Previous supervisors.
• Colleagues.
• Direct reports (if applicable).

Reference checks validate the candidate’s claims and provide insights into their work style. Example questions include:

• “How did they contribute to the team?”
• “What areas could they improve on?”
• “Would you hire them again?”

This step also acts as a natural filter—candidates unwilling to arrange these calls may have something to hide.

Step 11: Provide New Hire Coaching

Within the first three weeks, offer tailored coaching to help the new hire transition smoothly. Use the executive summary to focus on:

• Developing weaker skills.
• Setting clear performance expectations.
• Building rapport with their new team.

Early support boosts engagement and retention.

Step 12: Measure Outcomes

Regularly assess the Topgrading process to improve future hires. Metrics to track include:

• Performance of the new hire (e.g., productivity, feedback from supervisors).
• Retention rates over the first year.
• Team satisfaction and dynamics post-hire.

Seek feedback from the new hire about their experience to refine the process further.

Benefits of Topgrading

Improved Hiring Accuracy

Topgrading significantly increases the chances of hiring top performers. It eliminates guesswork by using a structured and thorough interview process. This process uncovers patterns in a candidate’s career history, ensuring their claims match their actual performance. The detailed job scorecard clearly defines what success looks like for the role, which helps you measure candidates objectively. 

By including rigorous reference checks, Topgrading ensures only qualified candidates move forward. Companies that adopt Topgrading report higher satisfaction with their hires because the process consistently identifies individuals who excel in both skill and cultural fit.

Organizational Impact

Businesses that use Topgrading experience measurable improvements in team performance and company culture. For example, General Electric implemented Topgrading and increased the percentage of A Players in their workforce, leading to better decision-making and higher productivity. Similarly, Honeywell improved its talent pool through Topgrading, contributing to significant growth and better team leadership. 

Companies also see reduced turnover because employees selected through Topgrading are more likely to thrive in their roles and align with the organization’s values. A workforce full of high performers creates a culture of excellence, innovation, and collaboration.

Organizations that use Topgrading can match their strategies with guidelines from the Society for Human Resource Management (SHRM). They can also align with standards from the HR Certification Institute. This helps them follow best practices in strategic planning and HR management.

Cost Savings

Hiring mistakes are expensive. Studies show that a bad hire can cost a company up to five times the person’s annual salary due to lost productivity, recruitment expenses, and training costs. Topgrading minimizes this risk by thoroughly vetting candidates and ensuring you invest in high performers. 

When you hire A Players, they contribute more to revenue, reduce inefficiencies, and often require less oversight. 

Additionally, companies save on turnover costs because Topgrading emphasizes long-term fit. This means fewer hiring cycles and a more stable, engaged workforce, ultimately driving down costs while improving ROI.

Real-World Examples of Topgrading

Several organizations have successfully implemented Topgrading and achieved remarkable results by prioritizing hiring high performers.

• General Electric (GE): GE adopted Topgrading as part of its talent strategy to ensure it hired and retained A Players across key roles. By using the method’s detailed job scorecards and rigorous interview processes, GE increased the percentage of top performers in leadership positions. This shift contributed to stronger team alignment and improved decision-making, leading to better financial outcomes and innovation across divisions.
• Honeywell: Honeywell turned to Topgrading during a period of organizational transformation. The company significantly reduced employee turnover by incorporating the Topgrading interview process and focusing on cultural fit. Honeywell reported that hiring A Players improved team morale, increased productivity, and accelerated the company’s growth initiatives.
• Barclays: The financial services giant used Topgrading to refine its leadership pipeline. The structured interviews helped identify executives who not only excelled in their roles but also aligned with the company’s long-term vision. This strategic approach strengthened Barclays’ leadership team, creating a ripple effect of success throughout the organization.

Lessons Learned

Organizations implementing Topgrading gained valuable insights into what works and what doesn’t.

• Preparation Is Crucial

Companies that invested time in developing clear job scorecards and aligning hiring teams saw the best results. Without this step, even a thorough interview process struggled to pinpoint top performers.

• Commitment Across Teams Matters

Organizations that trained multiple interviewers in the Topgrading method reported higher success rates. For example, Honeywell ensured its hiring managers were well-versed in conducting competency-based and Topgrading interviews. This uniformity in approach created consistency and reduced subjectivity in hiring decisions.

• Candidate Fatigue Can Be a Risk

Companies learned that the exhaustive nature of the Topgrading interview process could overwhelm candidates if not managed carefully.

GE changed its process to keep depth while respecting candidates’ time. This way, they stayed engaged without losing the quality of information collected.

• Reference Checks Require Buy-In

The Threat of Reference Check (TORC) worked well for companies that communicated its importance early in the process. Those that failed to explain this step often faced resistance from candidates, which delayed decisions.

Conclusion  

Topgrading allows the recruiter to have a personalized hiring experience. It helps them avoid hiring the wrong candidates. Instead, they can choose the right candidates who will benefit the company in the long run.

Even though it might seem like an expensive process, it saves a lot in terms of time and effort on a larger scale. The process of topgrading can be modified per the business requirements and the recruiter’s budget.

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