I got an excellent comment from Salve,from my post Internal Locus of Control and Responsibility.

He asks an excellent question, ” How do you know an applicant is good based on his bio-data, and a 30 minute interview that the person can not only perform, but can execute well under pressure?”

The answer is you can’t, and no matter how good you are, you cannot know a person that well at so short a time.  Heck, I misread even people I dealt with for years.

That is the reason why businesses have to tailor their HR to make sure you get to know the applicant as well as possibly can before the hire decision, and continue to work on feedback and evaluation so you can get to know even better as he worked inside the company.  Moreover, for positions of responsibility, it helps to promote from within - people you are already familiar with, and know how to dealt with, and at least people whom you at least know how they react in adverse or stressful circumstances.

As they say, though this would be the last quote I would say works all the time, ” better the sob you know, than the angel you don’t know.”

This is a revealing report on subprime mortgages. In a way, when the industry is growing fast, and everybody is aggressively focusing on getting their share of the pie, shortcuts inevitably happens, and repercussions occur.  A good reminder for us who manage businesses.

Neighborhood swayed by ‘liar’s loans’ - Yahoo! News

People who might have had trouble borrowing found it much easier to get a loan. Lenders devised new types of loans and eased standards to bring buyers into the market.

As a result, homeownership reached record levels.
But as interest rates rise and the market cools, it becomes clear many people were put into punishing loans they couldn’t afford.

That is particularly evident in the enormous growth of what the industry politely calls “stated income” loans — also known as “liar’s loans.”

Stated loans — whose borrowers list income and assets without having to prove anything — were meant for solidly self-employed buyers. Then they “morphed into a huge monster,” says Connie Wilson of Interthinx, a maker of mortgage fraud detection software. “Now we have stated income programs for everyone.”