My problem is recognising tallent outside of your core compentencies. If you can recognise tallent, it's easy enough to pick up people who are on the rebound from bad jobs, or who haven't gotten much paid experience yet. I regularly hire friends of friends, but then I hang out with very technical people who have very technical friends. I've picked up a lot of really good technical people with little experience and pa…
recognizing talent is one thing that humans are amazingly bad at, as recent HN stories about malcom's new book and the nytimes article about competent vs nice coworkers have suggested. i dont know if an iterative model can work in staffing. this is why experience is so valued by companies -- if you've done stuff, then you are able to do stuff (though, maybe you're a big faker who got lucky.)
but I don't think it's difficult to judge a person if you have known them for a while, especially if you are the type to talk about technical things in social contexts.
I think the problem appears when you are judging things outside your field, or people you only see for an hour.