I can confirm this works in my own experience of trial-and-error interviewing over 2000 applicants and hiring over 200 for my clients and myself (since ~2006).
Nearly 100% of the applicants were remote, so I think that helped me from falling into traps of poor "traditional" hiring practices.
The point of hiring these remote folks was to help accelerate whatever team I was on. It can be a great way to scale your existing team very quickly if you know how to do it.
For example, I took over an iPhone app dev team and it was taking them 4 months to produce an app. These apps were all very similar in functionality, but the developers were spending a ton of time slicing images, testing, and other tasks that remote workers could easily do. So I hired some remote staff (via oDesk) to do most of that supporting work and we got the app production time down consistently to 1 month. That was a huge ROI for the business since the total cost for all remote staff was the same as for 1 additional on-site engineer.
There's nothing magic about hiring well, but I've watched others try to hire remote staff and the vast majority of them try once, fail, and give up on it.
They will approach the hiring process in a traditional way (personally interview them to watch how they handle puzzles, etc). It's a grueling process and then they still get really poor hires and conclude that "outsourcing doesn't work".
It's most helpful to think of the process as panning for gold. (Naturally, I'm not saying that some people are more valuable than others innately, just that you're looking for those who are most valuable at performing your given tasks.)
So, to find gold, you must filter, filter, filter. That's the exact process for finding applicants that are high performers. Most of your applicants will be pretty terrible at the job you're hiring for, so the filtering process is critical for success.
- filter out the very worst applicants with a small easy question
- filter out the remaining applicants:
- pick a real-life production task you've recently completed
- ensure that the task is *exactly* what they'd be doing in the job
- have them perform the task
- compare their task results to your task results
- hire more than you need of the top performers
- filter out (gently fire) the ones that aren't as good
- repeat as needed until you have gold
When I see others attempt this, the most common problem is that they essentially go down to the river and just grab whatever pebbles they see in their first handful and hope there's gold in it (hire without filtering). Or they go down and carefully pick the prettiest pebbles hoping they will be gold (wrong filter / puzzle interviewing). But the only way to really find gold is to seriously invest in a filtering process that will yield actual gold. That means filtering based on their ability to do the
actual tasks they'll be doing on the job.
The great thing about hiring remote folks is that I care 0% how they get the task done. I don't care if they've automated it, or have their mom do it for them, or whatever. If they provide the results I need, I'm happy, period.
There are plenty of other smaller caveats and gotchas to watch out for, but I'll try to cover those in a blog post sometime.
If you're a startup and want to go faster, try this out by off-loading some of the grunt work from your staff. It can be a big competitive advantage if you can do it right.