At a time when we need it the most, America is squandering human capital. This waste struck me hard a few years ago when I saw, in two instances over the course of a few weeks, how weak our systems are in recognizing talent.
In June 1999, I had interviewed an unlikely job candidate for the office of economic analysis at NASDAQ. She didn't have a PhD, she hadn't majored in economics, and her college grades were mediocre. But a friend who'd taught her in Sunday school gave her the highest recommendation for smarts and work ethic. We met, and I was impressed. I took a risk. Two months later, she was a star in the department, improving complex databases and leading senior-level discussions on market structure.
Then the following August, I spent my annual four-day weekend as a writing coach with College Summit, a national nonprofit group whose board I chair. As a writing coach, my role was to help a group of students from some of Chicago's poorest high schools write their college application essays. One student, Loraine Cully, had a combined SAT score of 950 - far from stellar. Her only high school senior year extracurricular was the Spanish club, an hour a week. In her first essay draft, she dully recounted some college facts she'd learned an hour before.
The only recommendation in her file, written by a neighbor, said "Loraine is a very unique individual." I doubted it. I probably also lamented the sorry state of urban education, and thought how fortunate my own children were to go to better schools.
But as the group delved further, Loraine began to open up. She revealed that for her parents, who hadn't gone to college, "50 percent effort was good enough," but she wanted more. On top of her full course load, Loraine helped out with two younger siblings and worked more than 20 hours per week as a bank teller. And, Loraine revealed, her eyes lighting up, that she was an inventor. In the final draft of her essay she wrote: "Ideas and inventions are always in my mind. Last year, I watched a commercial for salad dressing. This led me to reflect on how chefs marinate their food.... Then I went to do the laundry and thought of how washing machines spin clothes, saturating them with soapy water. I began to connect the motion of the washer with marinating food. With these thoughts, I conceived and designed a meat-marinating machine that beats and flavors meat similar to the way a washer spins and soaks clothes."
So how does America identify the Loraines who have so much potential?
I had a chance to assess the NASDAQ candidate beyond her résumé during our interview. But how would colleges find Loraine if all they saw were her test scores, indistinguishable from those of the mas ses of low-income, mid-performing youth? But if colleges were able to recognize her talents, they'd invest in her creativity, drive, and entrepreneurial instincts in an instant.
National Urban League president Hugh Price has said, "In many people's minds, merit has become synonymous only with quantitative things like grades and scores on entrance exams. But other things like potential, drive, and grit are what matter in the real world."
How much American talent is being lost because there's no system for reviewing a student's potential? As an employer, I consider the whole person before hiring. As an investor, I use market tools to identify stocks whose numbers understate their potential growth. As a father, I help my children see and use their strengths to reach their goals - whether it's running for class president or applying to college.
But, for evaluating first-generation college applicants, what system is there for identifying personal potential not evident in grades or standardized tests?
Three things need to happen. First, colleges and universities should be held accountable for enrolling and retaining low-income youth. Until measured by that standard, they won't invest the innovation and resources needed to determine which students, among all the 950 SATs, are Loraines. Both the Department of Education and influential ranking systems, such as U.S. News & World Report, should require and publish this information.
Second, high schools should be held accountable for actual college enrollment, not just test scores or graduation. Until high schools are measured by that standard, they won't invest the innovation and resources needed to ensure that every college applicant learns how to identify and show his or her strengths to colleges.
Third, communities need to coordinate the work of schools, colleges, and employers to harness overlooked talents. The job is not just for schools. Through a coordinated effort, all three community institutions must contribute, each reaping far larger returns for their collaboration than any of them could gain acting independently.
Ask any investor if numerical indicators alone tell the story of a company's - or a person's - true potential. Ask the economists at NASDAQ who worked with my new hire - or ask Loraine's junior-year adviser at Illinois State University, where, as an entrepreneurship major, she has a 3.3 GPA and is editor of the Entrepreneurship Newsletter.
We can't afford to keep overlooking the kind of talent that will make America powerful in the next century.
• Dean Furbush is executive vice president of NASDAQ Transaction Services, and chairs the board of College Summit.