Barry Schwartz’s “The Paradox of Choice: Why More is Less” is one of those seminal reads that seems to be even more relevant today in financial services, than when it was originally published in 2004.
In it, Schwartz critiques the very heart of Western culture – the idea that in a free society, we have more choices than ever, yet we’ve never been less happy or satisfied. From this platform, he uses this concept to explain a number of feelings that are typical of our current world – such as the feeling of being ‘connected’ (via technology) but less able to ‘connect’ with people (or at least experience it in the same way as we did pre-technology) and the rise of depression, anxiety and general feeling of dissatisfaction, which he sees as, in part, a result of increased choice making people more likely to place blame on themselves when something goes wrong, or isn’t as they expected.
At the core of Schwartz’s argument is the idea that with more choice, we are more likely to either be paralysed (by too much choice) or disappointed (as we will always think that we didn’t make the best possible choice). This is an idea, that as recruiters, resonates with us profoundly – in fact, we see it every day when it comes to hiring and building your team. But how? Let’s take a look.
When you decide to hire, you have a choice. Taking aside any specifics on the ‘supply’ levels of the type of hire you are trying to make in the market (easy to find or hard to find – supply vs. demand), the fact is that people are more ‘available’ these days due to social media and online platforms. Which makes the perception of choice – at least on the surface – much larger when it comes to hiring. This is especially relevant at the senior end of the finance market. If you are hiring for a Head of Finance, you will likely have a high supply of candidates – resulting in, guess what – a massive amount of choice.
Which, as Schwartz would tell us, can lead to paralysis. Faced with high levels of choice, decisions become a lot more difficult to make, as we become fixated on either the fear of making the wrong decision, or on the lure of making the ‘perfect’ hire. Like Schwartz compares the quest to find the ‘perfect’ pair of jeans, during the process of realising there is so much choice, the risk is that your initial expectations may become heightened to such a degree that only ‘perfect’ becomes the right answer.
Take this supply away – and the choice becomes easy to make. For example, if you’re recruiting for a more junior role, you’ll likely only have 2-3 to choose from. With a senior hire, you could sit there and interview for days.
This leads me to our last point. Paralysis caused by too much choice doesn’t only lead you to question your decision, it leads you down to road of potentially missing out on what you wanted in the first-place – due to delayed action. Again, this is a situation experienced quite a lot at the senior end of the market, where candidates may lose interest or trust in protracted recruitment processes. Even at salary levels where there are less roles (lower demand), the strongest candidates will always be hired quickly – so if you leave it too long- you may not have the choice you initially thought you might.
What’s the takeaway here? Understand the paradox of choice. It may seem like you have more choice, but be careful to use it sensibly, and don’t let it paralyse you. Be careful not to translate choice into a quest for that all too illusive ‘perfection’. And finally, be cautious of timing – this is the factor that de-rails the benefits of choice – so act with speed and don’t let delay become the cause of your recruitment woes.
Building Your Team?
Fionnán O’Sullivan is Managing Partner at Barden’s Financial Services practice. He is an expert on financial services careers including asset management, banking, insurance and wealth management.
Reach out to Fionnán to see how he, and his team, can help you build and retain truly world class financial services teams.