The Ethics of "Poaching"

I read an interesting article this morning about the ethics of poaching; not hunting animals out of season, but rather the idea of specifically recruiting or targeting key talent that works for another organization typically a competitor.I have to tell you that my initial reaction was "what"?

As the article went on it did differentiate between specifically targeting an organization with the intention of undermining them through recruitment of their key talent or recruiting with the intent of obtaining trade secrets or proprietary information, but short of that indicated it was ok. Thanks for permission.

It kind of takes to thinking that our lexicon has gotten to the place where we really have started to believe phrases like human capital. One small problem, our employees don't "belong" to us. We "rent" their knowledge, skills, and behaviors and for a period of time if we are skilled and lucky we create a bond of mutual loyalty because of respect and commitment, period.I think the timing is especially interesting now that it looks like the economy may be picking up. I see a lot of questions out there from organizations about what they should be doing about retention in the face of a more robust economy. I advise prayer.

I am only being semi sarcastic. I am stunned by organizations who do not make investments in engaging and retaining employees on an ongoing basis and then want to install a program to fix it when there are issues.Employment at will is a concept that most employers will defend with the ferocity of Charlton Heston over the right to keep and bear arms- as long as it is balanced in their favor. They don't like it when employees see themselves as free agents.I hear a lot about loyalty as well. I define loyalty pretty simply. We interact with trust and respect. We meet our commitments to each other and we take into consideration our actions on the impact of the others in the organization when making decisions, period.

Out in the Wild West where I grew up we called it "riding for the brand". While I was sleeping in your bunkhouse and eating your food I was present, you got my honest effort. There were no life contracts or pledges of fealty.

I guess I am a career poacher. When I see people who are really good at their jobs and whose skills might be transferable to an organization I work with or for I feel comfortable bringing to their attention that if they are interested in exploring options I would like to talk with them.

As you know I am a huge believer in the concept of engagement. I guess my model is the best way to keep your employees from being "poached" is to create an environment where they don't actively seek or entertain other options because of the relationship of mutual respect and trust you have created. If my employees find another opportunity that they feel meets their needs or provides them with a chance to expand a skill base I wish them well if it is the right opportunity. You see I have found ex employees to be one of my best sources of future employees, if I treated them well they remember it and share it with their friends and associates.

So I guess with the exceptions of targeting or attempting to take trade secrets we need to acknowledge there is no such thing as poaching. Mr. Lincoln freed the slaves well over 100 years ago, people can't "steal" something from us we never owned in the first place.....

Employees for Life?

What inspired me to write this were two different pieces from people I respect in the business, Laurie Ruettiman at Punk Rock HR, http://www.punkrockhr.com/; and Margaret Heffernan at BNET, http://www.bnet.com/.

Laurie's always enlightening and entertaining post talked about what is wrong with the recruitment process, and props to her for stopping at less than a page because there is plenty. Margaret took a completely different approach and discussed the concept of never being able to fire an employee again!

Kind of makes your blood run cold doesn't it! I think most corporate employers look at Employment at Will the same way Charleton Heston looks at the right to bear arms, you will pry it out of my cold dead fingers.

I think sometimes that makes us sloppy and indifferent. Sloppy and indifferent to the tune of $5 trillion dollars in turnover costs annually in the U.S. alone. Add in another $200 billion for "presenteeism" and you are talking about real money, aren't you?

The things I read also say that a majority of employees are unhappy in their current jobs and performing at less than their potential and capability. So my question is-

• We like to think of ourselves as the most advanced country in the world, why are we watching this unfold?

I see a lot of things out there on the net asking "Now that the economy is picking up what should I do about employee retention and my key people?". I also hear from employers at all sizes that in this economy employees don't have as many choices so "I can focus on other more "critical" things." Last, but not least when I discuss poor practices and the costs and efforts associated with poor hiring I get the typical "Shit happens, people come and go. If someone doesn't work out we can always terminate them or lay them off."

What if you couldn't? What if you were "stuck" with the employees you have, what would you do then?

I think one of the things you would do is to have a way better process. You would be much more careful about who you hired and who was involved in the process. You might ask questions about things like "fit", "potential", alignment with "values". I'll bet the people involved with the process would be more senior and better trained. You wouldn't rely on your "gut" or a computer program to make the decisions for you. Because these people will be with you forever, and forever is a very long time isn't it?

Margaret lays out some pretty good advice about how to do somethings differently;

• Choose carefully at the start. We call this Hire Hard- Manage Easy. If this is a relationship not a "date" you should think it through.
• When you see trouble, intervene early. Don't watch someone struggle or fail to address an issue because you didn't want to hurt someones feelings.
• Stop waiting for them to quit. Studies show that actively disengaged employees are no more likely to quit than employees who are neutral or passively disengaged. They "quit", contributing that is. They stick around and poison the well.
• Right person, wrong fit? Is it the employee or did we put them in the wrong job? How many times have we taken a good "technician" and turned them into an awful manager?
• Are they being managed properly? My experience has taught me a lot of "performance" issues stem from mismanagement. You can't manage everybody the same way. Poor skills or application of skills at the front line manager level is one of the biggest contributors to turnover, litigation, unionization, etc. It doesn't matter if you are a "servant leader" if your front line supervisors are tyrants.

So even if we keep our right to employment at will, which by the way I am a fan of, shouldn't we at least consider making changes to how we hire and manage ? Especially if it can potentially save us over $5 trillion dollars a year. Doesn't that seem like good business?

Think about it, $5 trillion here and $5 trillion there and we are starting to talk about real money.....

The Twilight Zone

Isn’t it interesting how fine the line can be between a management strength and a management weakness. Do you remember the show “The Twilight Zone?” It’s that shadowy place where things could go right, or could go wrong; where things may not be exactly as they seem to be.

In one set of circumstances, an attribute of an executive might be viewed as a positive and valued; and in another set of circumstances that same attribute could be a real problem, significantly affecting their performance and/or judgment.

That doesn’t make selecting the optimal talent any easier, does it? But, if you just ignore this dilemma, your choice of key talent could be a real “crap shoot.”

Please consider:
A person who is excitable usually is high energy, passionate and enthusiastic. But, under pressure, they may be somewhat unstable and even display some anger resulting in others avoiding them.

Someone who is diligent is hard working, with high standards; maybe even self-sacrificing. But they can also be perfectionistic and hard to please. Have you ever worked for someone who is over controlling and micromanaging? I never found that particularly motivating or productive!

How about someone who is dutiful? What a wonderful trait. They are a good team player and considerate. They keep their boss informed. But, in the “shadows” they may turn indecisive, unable to make independent decisions or disagree with the boss.

I think understanding the dynamics of these types of shadows is critical in understanding management failure. It is in the shadows that managers have trouble building a team, forming alliances, gaining support for their vision, values and plans.

The most obvious way to reduce this risk in an organization is to screen out these types of issues in the selection, promotion or succession process. But, these contradictions are extremely difficult to uncover in an interview. It simply takes a process with more insight; a process with validated assessment instruments; a process with effective 360° reference checking; etc.

Does your executive evaluation process for potential or current executives illuminate the shadows? Where is Rod Serling when you need him?

The "Right" Retention

I remember a number of years ago being in an a some what similar situation to the one is see now. Our current economy has lulled many employers into believing that focusing on recruitment and retention issues aren't important right now because the current economy has severely restricted employees opportunities to change jobs.

Back in the late eighties I was a human resources manager in a community where we represented one of the only viable high technology careers to people. I felt like we didn't treat our people very well and we were seeing issues that now I can clearly identify as disengagement and presenteeism. When I pointed this out to our then CEO his comment was "they aren't leaving, are they?" His point was as we didn't have a "retention" issue we didn't have an issue. I replied with a viewpoint that I still believe today. I said, "you know there is something worse than leaving employees can do if they are unhappy. They can stay." They can stay an produce the minimum, they can "poison the well" for others, and they can hold on to jobs and prevent your ability to attract "contributors".

I read a recent article by Kenneth Thomas at www.hreonline.com that expressed a similar viewpoint. His article, titled The Right Kind of Retention, explores that same idea almost twenty years later. He and I agree that the goal shouldn't be retention, but rather engagement. He points out that the 2008 study on Engagement by BlessingWhite found only 29% of North American Workers described themselves as engaged. If you look at the timing of that report is should be especially alarming, that was pre-recession. I wouldn't want to bet the ranch on the idea it has gotten better.

He also points out some other things we should know, but seem to continue to ignore- what it takes to create an environment of engagement. His model identifies four intrinsic elements that create or sustain engagement:

• Meaningfulness. The opportunity to contribute to something with a larger purpose or context. Something that matters.
• Choice. The degree of autonomy we get to exhibit in doing the work. Not necessarily choosing what the task is, but choosing the how.
• Competence. A sense of satisfaction, pride, and mastery. Working towards flow.
• Progress. A belief that your work is moving you and the organization forward. A sense of contribution.

The interesting or maybe not so interesting thing is that once again Thomas found that our old friends compensation and security are at best "break even" factors. In other words if you do them right the effect is neutral, if you do them wrong they are detractors.

How many of us are building these factors into our hiring and retention strategies? I would submit not many. We hire in most cases for KSA's or knowledge, skills, and abilities. You might call competence a KSA, but in the context that Thomas uses it I not sure it fits.

He points out another truism, we spend most of our time on the "poles" of our workforce, the top performers and the bottom performers. He and I agree there is a lot of opportunity to get significant contribution from the people in the "middle" who make up between 60 and 80% of our workforce.

So I guess my suggestions to you are that you build this in to your hiring and your retention strategies. Don't spend too much time congratulating yourself on statistics like tenure or a low turnover rate if you aren't sure why they are staying and how much they are contributing. If you hire for fit and include opportunities for meaningfulness, choice, competence, and progress you will see not only that your retention value goes up, but you are able to attract and keep contributors.

Oh yeah, to finish my earlier story. When other high technology employers entered our labor market our contributors left in droves. Turned out that had long memories and that they preferred choice to the "security" we provided them. Hope we all learn something from that experience.

Building In Flow- Hire Hard, Manage Easy!

My colleague made a great point about contributors in his post last week. As a practicing HR executive and consultant for over 30 years it has been amazing to see that most organizations squander a tremendous amount of resource- the 80% of a workforce that resides between the top performers and the folks we should move up or out. How many of us really spend time focusing on that group?

Daniel Pink, in his book, Drive, describes the phenomenon of "Flow". As Pink describes it flow is that place where your objectives and effort are perfectly synchronized. You have the ability to get immediate feedback without unnecessary external feedback and there is just the right tension between effort and ability. When you are in flow you are engaged fully in the activity. Pink and others including Seth Godin describe that as a big part of the Industrial Revolution we deleted flow from the mix. We didn't want employees distracted by looking for flow. We wanted to break things down to be simple and repetitive. That makes it easy and cheap to recreate the activity. The value of the labor content goes down and the "owner" enjoys the margin. You exchange personal competency for "security". Almost all of our educational and training systems are based on this model. When you control the economy or the balance of economic power this works pretty well.

The alternative to this model is building in engagement. Engagement requires recognizing things like organizational and individual values and synchronizing them. It requires a whole different way of hiring and training. Most hiring protocols focus a lot about things like KSA's- or knowledge, skills, and abilities. With the advent of the ADA or American's with Disabilities Act, we added a whole new level of psychological and verbal proctology with excruciating descriptions of the work environment and physical and mental capabilities. It doesn't talk about congruency, or values, or fit. I find most to be terribly two dimensional.

The statistics on turnover in the U.S. alone are horrendous. Estimates range as high as $5 trillion annually. Employee dissatisfaction is at historic highs with 55% of employees indicating discontent with their current job. The "efficiency" of the U.S. economy is estimated at 30%, and that was pre-recession. The biggest reasons for turnover and lost productivity are organizational "fit" and poor management.

A recent study I encountered says that our current approach to training has us spending $100 billion annually with less than 10% of the "training" translating into long term or sustained job performance.

Alternatively engaged organizations enjoy advantages in almost every key performance indicator including productivity, profitability, and sustainability. Their turnover rates are also much lower. Engaged organizations build flow in to their processes. They start with who they hire and then reinforce their values and culture throughout the rest of their "systems". They hire and reinforce contribution as a core value.

If you are a CEO, organizational leader, or an HR person tasked with the attraction and retention of talent to sustain your organization I would suggest you ask yourself some questions:

• Am I addressing flow in my hiring and selection at all?
• Am I trying to "bolt it on" if I am not building it in?
• What would our organization and bottom line look like if 80% of our staff were experiencing flow?

I believe top performing organizations hire and manage for flow. What do you think?

Feed the Lions, Ride the Horses, Shoot the Dogs

I have never met a business leader who didn’t want more high performers in their firm. How many of your direct reports are really high performers? Would it make a meaningful difference in your ability to reach your business goals if you had more high performers? What are you doing to turn your average performers into high performers? How do you motivate your high performers to keep them motivated and engaged so as to maintain high performance? When you are in the market to hire a key executive what do you do to insure that you hire a high performer?

If high performance is important to you, there certainly is a lot to think about.

I want to suggest, however, that a high performer is not what you really need. High performers are great, but there is even a more elite, a more coveted type of key executive to have on your team. And, the more you have, the merrier.

What you really need is the cream of the high performers, with the definition of performance being real financial improvement for your business unit. I call this breed of high performers…contributors.

Contributors are the people who really drive economic improvement in a business unit. They can be in financial, operational, sales…really, any type of position. They have ideas on how to grow the top line (without conceding margin), how to operate significantly more efficiently, how to reduce cost big time, and so on; and they can do it and/or lead a team to do it. They have what it takes to make it happen.

They can define, even foresee, a problem. They can fully and properly delineate it. And they can solve it. They can find an opportunity, contextualize it accurately and go get it.

Improving the economics of their situation is what motivates them.

A contributor walks into a job and when they leave, the profit contribution of the business unit is meaningfully better because of their ideas, their focus on profit contribution, their strategic and tactical reasoning abilities, and their leadership.

How many contributors do you have on your management team?

I don’t think that all high performers are necessarily contributors. High performers do well on the key attributes of their job. They perform well. You do need more high performers. Contributors do that, plus they drive the profit contribution up! You really need more contributors. Does this resonate with you? Let me know what you think?

Building Congruency Into Your Hiring

A number of years ago I had the opportunity to become certified in several sales and customer service training programs offered by the Integrity Systems organization, www.integritysystems.com . One of the most impactful things that I learned from these programs and their founder, Dr. Ron Willingham, was the concept of congruency.

Dr. Willingham describes congruency as being made up of five elements:

• Our view of the activity
• Our view of our ability to do the activity
• The relationship between the activity and our personal values
• Our willingness to do the "work"
• Our belief in the product, service, or organization

As I listened to this model what struck me is its applicability not only to sales or customer service to any role or job. Think about how difficult it would be to perform at a high level if your work was in conflict with one or more of these elements? Yet how often are we testing for congruence with these elements in our hiring process or in addressing deficiencies in performance between our expectations and their actual performance?

In another way you could look at this as cultural hiring. Companies that have developed high levels of engagement in their organization have explicitly or implicitly built this congruence into their culture. They have created an opportunity for people to "join up" with their organization rather than merely comply. Given that we are seeing "failure" rates of better than 40% in outside executive hires and new managers we might want to examine this, especially given that most failures are not occurring because of "technical" competence. I also believe that this is why technological interventions like Six Sigma or lean manufacturing do not sustain long term results. They don't address the "people" issue and organizations are made up of people.

So I would submit to you that hiring for congruency and recognizing that you are hiring a "whole person" should be a critical part of your hiring process. I would go further and recommend that you not rely exclusively on the interview process to validate that congruency.

As my colleague Joseph Skursky of Market Leader Solutions, www.marketleadersolutions.com, says "Hire Hard-Manage Easy". You will find that the payoff is there in the long term....

The Criticality of Hiring "Right"

I had the opportunity to spend a good part of this week with people who are true linchpins- they make critical contributions to organizations that they are part of and that they serve.

We were exploring the importance of behaviors and your "unconscious" persona in how you interact and effect others in various kinds of relationships. It was especially interesting to hear how the "leader" effects everyone on the team, or at least the key contributors. What was also very interesting is that these impacts come through channels that in large part are behavioral or interpersonal rather than technical.

The reason I think this is so important is because so much of our hiring processes still concern themselves with "skills" rather than attributes and behaviors. This correlates well to other research that I have discussed in this blog and other places about the importance of understanding and hiring" the "whole person" not just a set of skills or qualifications.

Think about how many people who looked great on paper, but either in the interview or worse yet after their hire we realized we didn't have the right "fit". How many times did the fit issue related to their technical competency? Worse yet how effectively do we deal with the issue once we discover it? I find we either usually "suck it up" and add one more person who isn't really performing at an optimal level or rarely we "cut our losses" and terminate or transfer the person. Neither of these is a great solution.

So what is my point- it is that we need to really invest the time, energy, and commitment to understand ourselves in terms of our company culture and the people we invite to "join up" with us before we extend the invitation. There is a better way to do this...

Are You Hiring "Linchpins"?

I am reading Seth Godin's latest book, Linchpins. I have too tell you it is pretty fascinating. In this book Godin explores the concept that a third relationship in the work environment has evolved beyond the traditional labor and management. He call these people Linchpins, and argues that their strength and contributions are not in their technical skills and competencies, but rather their ability to build trust and connect individuals and groups- building relationships.

If we put that concept into context let's explore the idea that almost a third of outside executive hires fail outright along with 40% of new managers. In both cases the primary reason for "failure" is not technical, but rather their ability to fit the culture and build relationships! Sounds like Godin may be on to something.

How many of us really explore this "fit" issue extensively as part of our selection and development process? I would submit it is a minority and if we do it is an ancillary rather than a primary consideration. Even in human resources I see a bias toward skills in systems and compliance rather than relationship building. We use screening software to search for key words or phrases in "weeding out" applicants from candidates. We build succession strategies largely based on technical competencies rather than relationship builders.

Today we stand at a place where employee dissatisfaction with their jobs is at a record high. Less than 30% of organizations in the world have a formal or for that matter informal engagement strategy. Science shows us that moving the level of engagement up has huge beneficial consequences on almost every key performance indicator, but many organizations remain reluctant to embrace an engagement or employment branding strategy.

Many companies I speak with are using the current economic situation and high unemployment to focus on "important things" like costs and efficiencies because employees are staying. They might be staying, but are they producing at optimal or even better than average levels. Are you getting "compliance" or are you getting "discretionary effort"?

So I am with Godin, as you explore your hiring and succession plans I would build tools to identify and screen for "linchpins" who can connect people with your organizational purpose and mission. I also agree with him that these people are in high demand and it is going to get higher not reduce. Especially if you believe Daniel Pink who feels that purpose is a critical motivator for people, especially in our "knowledge worker" economy when routinizing of work and removing autonomy and flexibility is a productivity detractor!

Show me a highly successful organization today that has reached and "sustained" success and I will show you an organization that has "linchpins". Perhaps Collins was only partially right, it isn't just about "getting the right people on the bus" it is about connecting them in a meaningful way to your purpose and goals. What do you think?

Hire Hard - Manage Easy!

I am very pleased to see interest in topics like employee engagement and employment branding gaining some momentum, even if it is just in dialogue.

I have to pay an homage to the people at BlessingWhite for their recent studies and research and Dr's Whitlark and Rhoads for their publication about the "Spillover" effect which provides concrete relationships and data; drawing a direct correlation between high engagement and key performance indicators like sustainability, productivity, and profitability. This is no longer "warm and fuzzy" stuff, but rather hard data.

I do continue to see that for all the dialogue I am still disappointed with the number of organizations and C level executives that are either ignoring this opportunity (some would say crisis) or paying lip service to it.

There are a couple of other things coming out about engagement that I have long believed that I am pleased to see gaining some traction as well:

• Defining engagement. This a a huge area. Engagement is not happiness or employee satisfaction. Much like compensation the lack of happiness or satisfaction can have a negative affect on engagement, but "happy" or "satisfied" employees are not necessarily engaged. The basic reason for that is that the work place may be providing an outlet for social relationships or other things that employees enjoy that affect those areas, but don't lead to additional productivity or discretionary effort. Measuring those other things doesn't necessarily yield engagement.
• Creating engagement. The other thing we are starting to recognize is that engagement is not an initiative or program it is a culture! To create and sustain an engaged workforce and long term employment brand you must create and sustain a culture.
  

I think that these "revelations" may be part of what is keeping many organizations from embracing an engagement strategy or employment brand- they aren't prepared to do the work.
The last thing I want to share today is my response to the opening question. In my opinion engagement and your brand live at the front line level of your organization. I am not saying that senior management support and role modeling aren't critical, but how many of your customers or employees interact regularly with C level management?

How many of us encounter Howard Schultz when we visit Starbucks or Steve Jobs at the Apple store?

My point is you must build engagement into your brand through your selection, hiring, training, and performance management and reward systems. I would go further and say that your front line managers are your greatest potential asset or weakness. In fact Whitlark and Rhoads are even more specific;
"One bad manager can pollute multiple levels of an organization, and poor managers bring down employee morale, which spills over into the engagement level of customers.”

My opinion is that your "engagement" or "branding" effort must be embraced as a culture change and you have to be willing to "de-recruit" employees especially managers who can not or will not make the transition. My experience has been validated by James L. Heskett, author of the book The Service-Profit Chain, who writes-
“… the hardest concept is the deployment of the culture change …which requires that organizations identify values, behaviors, and measures that help reinforce the service profit chain relationships. But it also requires actions. That is when managers are not managing by the values and cannot be admonished or retrained to do so (which rarely works), they have to go.”

So I guess what I am saying is that engagement is mutual commitment and while it is important to have brand champions in the C suite you will be most successful when you embed it into the fabric of your organization because engagement and your brand live on the "ground floor" where your employees interact with your customers. As my colleague Joseph Skursky so elegantly states, Hire Hard- Manage Easy. You may find it a better long term strategy. What do you think?

Creating a Succession Plan

I just read a "conversation starter" article by McKinsey and Company on the topic of succession planning, focusing on the CEO.

They reiterated again about the importance of this process and bluntly how for the most part how badly it is done.

Badly is described as

• Ignoring it because it causes you to deal with your own "mortality"
• Because in many cases it is left to the CEO who often times hires the replacement in their "own image" rather than dealing with the changing dynamics of the business and the markets
• Because it happens in panic, without a thought out process for what we need when and how
• Because it doesn't take into consideration those internal candidates who are unsuccessful.

I could go on, but you get the idea.

The selection and development of your "mission critical" staff is one of the most important roles of the executive team and in larger organizations the board and the executive team. Senior leadership are the guardians of the mission and vision of the organization. As Marcus Buckingham stated- "the most important skill for leadership is clarity", the alignment of strategy with vision.

So ask yourself in your organization; do we have:

• A succession plan for all "mission critical staff"
• A periodic review for evaluating whether the organizations needs or market conditions have changed requiring an update to the profile
• An objective process for evaluating all candidates; internal and external, developed proactively rather than defined by the candidate "pool"

If your answer to one or more of those questions is no this might be a good time to get started on building your process, because as McKinsey and others point out- wrong process= wrong result.

The wrong result is expensive in more ways than one....

When Will We learn?

I have been following a number of interesting discussions on LinkedIn and other places about the issues surrounding employee recruiting, selection, and retention.They range from the importance of the process to the idea that since we are in a recession and employees don't have anywhere to go we can focus on other more "important" business issues.Interesting viewpoint.

Studies show we are operating at 30% efficiency, employee job dissatisfaction is at an all time high, and to some it is a non-issue. I suspect they are not on the top 100 places to work list.

Another discussion I am following began to target some of what I believe to be the real issue- in many cases our hiring and selection processes are not well thought out and executed. They are ancillary rather than strategic.That is the difference between truly high performing companies and those firmly "in the pack". The concepts of employee engagement and employment branding are coming into vogue. The idea that engagement and the resulting discretionary effort are built in to the foundation not added on later. A colleague shared with me "at Nike to work there you must be an athlete". They are clear about the JFHF3HCJD6FE culture and hire with it in mind. Other icons do the same.

If you are a senior executive how much time are you spending making sure that the people who are joining your organization or at least your team have the "right stuff", or like many organizations have you delegated this to your HR department? Here is a tip. Recruitment selection and retention of the best people is a management role, it doesn't "belong" to any one department.

Top performing organizations have figured this out. It is a big part of why they are top performing organizations.So if you are taking the time during this recession to focus on the "important" stuff and ignoring your people strategies it will be interesting to see how it works out for you.....

The "War" for Talent

I read something on LinkedIn the other day that I thought offered an interesting and in my opinion incorrect perception- that the "war" for the best talent is over for the short term because of the current recessionary and unemployment conditions.

It rather reminded me of a conversation that I had twenty years ago with the CEO and VP of HR at a high technology firm where I was employed. I was frankly pretty disturbed by some of our human resources practices and policies that were just this side of exploitative in my opinion. It wasn't that our wages needed to be that low or practices that Draconian, it was that we were essentially the "only game in town". When I questioned our approach the CEO quipped "they aren't leaving are they ?".

He was right in many cases they weren't leaving, but our absenteeism, utilization of mental health care and regular health care benefits, absenteeism and other factors were much higher than both the industry and regional norms. Employee satisfaction was also low.

Then something interesting happened, some additional high technology employers came to town and "they" started leaving, in droves.

Flash forward to 2010. You see comments from CEOs, CFOs and others that because employees are anchored to their jobs because of the economy companies can occupy themselves with "important" matters like costs, efficiencies, etc. Employees aren't going anywhere.

Here are some contrary reasons to why I think that strategy is dumb:

• Employee dissatisfaction is at an all time high
• Studies show that something less than 30% of employees are "engaged" or exhibiting discretionary effort in their jobs.
• The demand for "experienced" workers is expected to increase by 15% while supply diminishes by 25% over the next 10 years.
• "Presenteeism" costs the U.S economy $200 billion annually.
• The costs of replacing an employee ranges between 2 and 5 times annual salary in "hard costs" alone.
• Engaged employees outperform their disengaged colleagues in every category and organizations with high engagement similarly outperform their competitors in every key metric.

Organizations that have high engagement didn't arrive at it by accident. They have a deliberate strategy. Do you really believe that organizations like Apple, Google, Southwest Airlines, and others are ignoring their people strategy? Do you really believe that best employees are going to stay with employers who exploited circumstances when the economy picks up?

So I have some recommendations JFHF3HCJD6FE for you during this "lull" in the war for talent:

• Look at your talent and acquisition strategy. As many as 30% of outside executives and 40% of new management hires fail within their first 18 months because of poor hiring processes.
• Studies have shown three essential pillars are key to long term business performance and success: trust, communication, and leadership.
• It is much more efficient to build an "employment brand" and hire people whom it resonates with than try to retrofit your culture and staff.
• The team with the best players playing in an aligned fashion always wins.

Systemic approaches like "lean", six sigma, ISO, and others aren't going to fix engagement and trust issues. Waiting until the "war" restarts and the cease fire is over seems like a dumb strategy to me. What do you think?

What's Your Plan?

Over the last year I have talked with many friends, colleagues and acquaintances regarding their happiness with their current jobs. Not one has told me they are excited to go to work each day but rather that they are being asked to do so much more with a lot less (that’s not anything new to all of us), they are not appreciated for the extra time and work they are putting in and that the general atmosphere of their workplace is tense and stressful. Some have even quit their jobs hoping to find that “golden opportunity” with a different great company. Are the days of employee satisfaction and engagement gone forever or is this just a temporary state of being? Are the days of employee loyalty and trust gone as well?
Where we are today
• According to WJM Management Advisor, they conducted a survey to which 47% of respondents claimed to be “miserable or “sometimes miserable” with their job. This compares to the survey of two years ago that indicated only 18% felt this way to the same survey question.
• A survey by the Center for Work-Life Policy reports that between June 2007 and December 2008, the proportion of employees who claim loyalty to their companies dropped from 95% to 39%; the number saying they "trust" their organizations from 79% to 22%.
• With unemployment in the U.S. at 10%, executive happiness and retention understandably become less of a priority for organizations that are preoccupied with bolstering productivity and protecting profits during difficult economic times.
So Why Do You Care?
• According to Monster.com, 79% of jobholders said they have stepped up their search for a new place to work since the recession began.
• Considering demographic trends it will soon get harder and harder for corporations to fill the vacant seats: low birth rates, baby boom retirements and caps on immigration could reduce the number of working people by 20-40% (The Economist, 10/10/09).
• A recent study by the Chandler McLeod Group revealed that 95% of the 930 executives surveyed were seeking alternative employment with 73% of the group pursuing other opportunities on an active basis!

In other words, an economic recovery may herald a seller's market for talent like we've never seen before. And of course, the ones most likely to hit the exits are the ones with the most talent and potential - i.e. the executives most sought after by your competitors!
So What Can You Do?
• Diversified and varied responsibilities vs. just more work. Studies show that giving more responsibility is one of your best strategies. It takes more than money to make people passionate. Dr. Tracy Duberman, WJM's SVP, Organizational Effectiveness states, "It's really about giving people increased opportunity, bigger roles, empowering them more, and watching them closely to see if they step up to, and are able to handle, each increased level of responsibility."


• Leadership communications. Your leaders’ communication skills are key to building a high-retention culture and high-engagement. This includes the C-Suite articulating compelling, strategic business goals and promoting the growth and improvement of the company's talent to support these objectives. This not only means leaders being clear about the business plan, but also transparent about talent selection and promotion, as well as coming clean with employees and sharing the “dreaded” bad news.


• Assess the skills needed to grow your workforce now and beyond recovery

• Identify what skills you have in your workforce and where the talent gaps are and what talent you will need to attract – talent skills mapping is critical at this time.

• Develop a talent attraction strategy, including revisiting the organization’s culture to ensure it aligns not only with the revised business strategy but also the type of talent you are retaining and attracting.



• Talk to employees about their career development plans and what motivates them. Remember it is easier and cheaper to retain than recruit!

• Be transparent and open about staffing projections, career development opportunities, and the “real” situation. Building and retaining trust is critical.



It is clear that until companies reach the realization that their “A” players are going to jump ship as soon as a better opportunity presents itself executive employee dissatisfaction will continue until it explodes. Employee engagement and employer trust are going to be the staples for an organization to survive the coming year.
What is your company doing to make sure that your valued executives are engaged, and committed? It is their futures you hold in your hands. Why should they trust you with something so important?

Building Your "Brand"

A colleague shared a great article written by Brett Minchington, an Australian consultant and expert on employer branding.

He mentions that he has been studying this issue for years and thought the start of a new decade would be a great time to explore it further.

It is interesting the reaction that you get when you say "branding" to the average business person. I usually get a reaction similar to what I get when I talk about engagement, both "functions" are thought of as belonging to marketing and externally focused. I find this interesting as studies have shown now for some time that the relationships that drive great organizations have their foundations internally rather than externally and are based on things like values alignment, clarity of organizational mission, clear expectations, and competent supervision.

When I talk about your employment brand I don't mean your recruitment brochures or candidate sourcing software. I mean taking the time to see your organization as a "product" that you want to get in front of your desired "customer" base and retain them.

Minchington mentions and I agree that building this "brand" doesn't belong to HR, Marketing, or Communications; it belongs to all three.

You might ask why I think it is important now; unemployment is high and employees are sticking tight to their jobs. The answer is why are they staying? Information about employee dissatisfaction and low levels of engagement would suggest they aren't staying because they are committed. Add that to the idea that the demand for "experienced" talent is going to increase while the supply decreases would suggest that relying on the recession to keep people captive is bad strategy.

I would also suggest that building your employer brand takes time and energy. It is intriguing to me how many employers still use a very reactive process to the acquisition and management of their human capital. They don't think through the totality of what they are looking for in an employee or candidate until an opening occurs if then. The urgency there usually translates into "find me a body".

There are of course exceptions. Top performing companies have created their employment brand. Businesses like Google, Starbucks, Apple, Southwest Airlines and others have a clear brand not only for "customers" , but for prospective employees. Even GE and EDS under Ross Perot were famous for what you "got" in their employment environment, not much ambiguity.

When I was an executive with a financial services organization we embraced a similar strategy. We rebuilt our "brand". Not only as a financial institution, but as an employer. We were clear about who we were and what we were seeking not only in customer/members, but employees.

In a little over three years we became an employer of choice. Our Recruiting Manager was selected as the recruiter of the year by our local national university beating out organizations like Nike, Intel, and Columbia Sportswear. We also enjoyed tremendous business success in the acquisition of desired demographic customers and increased "wallet share".

A colleague summed up our strategy quite nicely when she said " I understand now why you guys are kicking our ass. It isn't just the products and the services. Your people are better than ours at every level". She went on to say "Something tells me that isn't an accident". She was right. We didn't pay the highest wages or have an exotic employee fitness center, we built a brand.

Minchington says that over the next 10 years relationships will replace reputation in making business decisions. I agree in fact I would go further and quote Margaret Wheatley

"In organizations, real power and energy is generated
through relationships. The patterns of relationships and
the capacity to form them are more important than tasks,
functions, roles, and positions."

We have had six sigma and "lean manufacturing", ISO and other initiatives for years now and turnover is still costing the U.S economy alone an estimated $5 trillion per year with another $200 billion attributed to presenteeism, employees who show up, but don't engage. Isn't it time to explore some other solutions...?

I guess there is always plan B, if you have one.......

Life's Highs and Lows

Who was it that said, life is about highs and lows? Well, let's see from an employee perspective the highs from this past year would be:

- highest % of presenteeism (show up and then go home)

- highest % of job dissatisfaction

- highest % unemployment rate for most of the population



Not so "high" if you ask me.



Oh, and then there's the lows:

- low annual increases, and with some, mandatory unpaid time off and no bonuses

- low job efficiency (it's estimated at 30% in the US)

- low employee engagement


Yeah, life has its highs and lows. This past year has had them reeling.



So what do companies do about it? LISTEN, STRATEGIZE, and ACT.



I just watched the new Domino's pizza advertisement. It showed consumers calling its pizza crust "cardboard" and the sauce "tasteless". WOW. Then Dominos told us what they were doing about it. Oh, at the end the CEO says that they're changing. Did the employees find it motivating?



Well, let's think about it. Did they see their CEO implement and invest in a strategy about complaints I am sure the front line have been listening to for a long time? That would be motivating for me.


Complex? No. Honest. Yes. Did it work? Time will tell, but initial sales are growing.

Great Interview Questions

In actuality the interview process has been defined as potentially the weakest link in hiring and selection, but I came across these questions every interview should include and I wanted to share them with you and why you should use them:

• How about them Yankees? The point of this type of question is an icebreaker. It establishes a rapport and a context. Interviewing is stressful, if you can begin to build a rapport you will get better more honest answers.
• Tell me about a time you had to overcome a major obstacle? The point here is how do they respond to change and obstacles. Do they get creative? Do they shut down? Don't be afraid to probe for details. Also if your candidate is the "super hero" or victim this is a dangerous sign.
• What interests you about this job? I am all about fit and commitment. If they can't describe why they want the job or they are interested in our organization it makes for some heavy lifting to get them engaged. It can also tell you if you have "fit". If they are looking for something you don't offer or you see a mismatch with the hiring manager better to find out now.
• Is there intelligent life on Mars? The point of this question is that it is bizarre. It actually makes the candidate think on their feet rather than give you a pre-packaged response that they learned in a how to interview course. How they answer in terms of attitude, thoughtfulness, etc. is more important than what they answer per se.
• So we just hired you, tell me about your "first day" to do list? What you are probing here is decision making and judgement skills. It is intended to be situational and probe for skills or aptitudes you are seeking.
• How did you get into this field or career path? Again here you are seeking fit. Do their values correlate with yours. Are they "committed" or compliant?
• Tell me what you know about us? In this day of the internet, social media, etc. this speaks to preparation and investment. If they don't know anything about your organization they are going through the motions. Is this a person you want in your "life boat"?

As I said in the beginning unless you are a very skilled interview the interview itself can be very unreliable. These questions are much more about "fit" and attitude then about competency, but most candidates fail based on fit, not technical skills.

For me it is important to understand someones thought processes and how they respond in different situations. These aren't the only questions I would ask, but I would definitely weave them into my process. They are also intended to be illustrative rather than definitive. You can create your own variations. It is also okay to "wait" for a candidate to respond. While your intent isn't to create stress if the question is worth asking, it is worth waiting for an answer.

So what are some of your favorites and how do you use them?

Building Your "Team"

A Conference Board study released last week reported that worker satisfaction is at an all time low. Many employers are relying upon the recession as a retention strategy- employees have no where to go therefore we can concentrate on "other" aspects of our business. Yes Virginia, that strategy is really as dumb as it sounds!

So I would like to explore a different paradigm; one that says the concept of loyalty isn't dead and that the team with the best people doing the best work wins.

I wanted to take this opportunity to share some ideas from Daniel Pink, author of Drive among several other great books as well as some key other things you can do.

• One of the suggestions that Pink makes is to create great jobs. We have talked about this previously as building engagement into your process. When you build great jobs and a place for people where their values align with your own you tend to get great people.
• He follows that up with build great careers - even if they aren't entirely with you! I have long said that we need to redefine loyalty in terms of contribution not tenure. When people are giving you 110% while they are on your payroll they are in fact being loyal. Pink talks about boomerang employees; employees who may leave temporarily to get experiences or a promotion you can't offer them, but come back. In many cases they return with experiences and skills you couldn't provide. Their value has increased not decreased! Even if they don't return former employees who had positive experiences with you are great sources of future employees.
• Take the pulse of your employees. Great employers "re-recruit" constantly. They ensure that employees understand their role in the organization and how they "fit" constantly. They also focus on them as individuals. People like to know how they fit and contribute on a personal level. It's called meaningful feedback!
• Be realistic with your expectations and theirs. Some level of turnover is not only to be expected it is necessary. People's values and needs change over time. Making promises that you can't keep undermines trust and makes you seem as if you don't respect their intelligence.
• Treat them with respect. If I respect you I talk to you about your work in terms of outcomes, not process. I also hold you accountable within reason for achieving your work effectively and independently. I don't encourage co dependence or tolerate mediocrity. I see you as a "partner" not as someone who is beneath me.
• In addition to Pink's excellent suggestions I would add one of my own- Hire Right! By thinking through what kind of people you need and want to add to your team you will make better hires.

We know that based on lack of engagement, poor fit, and general dissatisfaction U.S. production efficiency is estimated to be at around 30%. Do you really want to rely on the lousy economy to get and keep the people you need to run your organization? Especially when studies also tell us that the supply of "mature" talent (25 to 45) is expected to decrease by 25% while demand increases by 15%. Or worse yet to you want to settle for 30% efficiency?

Are any of these things really that hard to do at the end of the day?

What's Your Plan?

I just had the opportunity to read a couple of articles that managed to both alarm me and to reinforce a long standing belief I have- we need to invest much more energy in our recruitment and selection processes.

The alarming part of the articles included the following:

• It is estimated that employee turnover costs the U.S economy $5 trillion annually.
• Another study states that we lose $200 billion annually to "presenteeism", that is where employees don't leave, but perform marginally because of stress, illness, dissatisfaction and related issues.
• Employee dissatisfaction with their jobs in the U.S. is estimated to be at its highest point in 50 years.
• The expected demand for "experienced" talent is projected to increase by 25% while the supply is expected to decrease by 15%.
• The majority of organizations are doing what they always do in a period of economic insecurity, hunker down and focus on the "numbers". They assume that a combination of economic uncertainty and high unemployment will either keep people in place or make other talent readily available.

Now for a corollary viewpoint:

• Engaged employees turnover at a rate 51% lower than their un-engaged colleagues
• Their absenteeism rate is 27% lower
• Their per capita productivity is 18% higher
• Organizations with high engagement are 12% more profitable than their peer group.

So at this point your reaction is probably; Duh! Engagement is better, and you are correct. The bad news is that engagement takes effort and work, it doesn't just happen. There are a couple of basic ways to create an "engaged" workforce:

1. You can build it in to your organization
2. You can try to "retrofit" it.

Similar to quality, building it in is a much more effective strategy, but it must be addressed systemically. So I would like to suggest a "plan" to you:

Build an employment brand

Top performing organizations recognize that building a brand is a cultural initiative, not a marketing strategy. The "brand" is part of the fabric of the organization. In the process of identifying, acquiring, and developing their talent their "brand" is intrinsic to the process. The employees experience the brand as much as the customer and the community. The values of the organization are sacrosanct, they are flexible about process, but ruthless about principles. Prospective employees seek them out because of what they represent. This is reinforced throughout the recruitment and selection process. Candidates are kept up to date on their status on progress through the process. Even unsuccessful candidates are recognized at potential future candidates or referral sources or customers.

I am not going to suggest to you there is a "right" brand or culture, but rather that you define it and communicate the brand that is "right" for your organization.

Talent management is proactive rather than reactive.

Top performing organizations maintain a robust internal and external talent "pipeline" at all times. Their processes are not reactive. They identify potential talent and take pains to develop that talent. I discussed in a prior post that truly progressive organizations see executive search firms as talent scouts and partners rather than vendors. They recognize these firms see thousands of candidates annually and partner with them as part of their process.

Recruitment, selection, and development are management competencies.

The best organizations ensure that everyone in management roles recognizes that competency in selecting talent, setting clear expectations, giving feedback, coaching, and taking appropriate corrective actions are everyone's job, not the exclusive province of HR. HR is a partner in the process, but the responsibility resides with the manager.

Talent is a corporate resource.

In the best performing organizations they don't follow best practices, they create them. Managers realize that their role in relation to human capital is that of stewardship, not ownership. They are expected to coach and reinforce values and competency not only in their own staff, but across the organization. The best managers are not "technocrats", but highly skilled at building teams and developing talent.

Engagement is a "built in" not a "bolt on".

My colleague, Joseph Skursky of Market Leader Solutions, refers to it simply as "Hire Hard-Manage Easy". Steven J Zaccoro in his 2008 literature search puts it more academically, but conveys the same concept in his "best practice" model:

• Define the position requirements. This involves the "technical" skills and competencies the position requires.
• Define the attributes. This is where we look for "fit". This is a critically important because of the more than 50% failure rate for executive new hires it is "fit" rather than competency that causes the "failure".
• Recruit appropriate candidates using the profile developed using the first two elements.
• Assess and evaluate using the pre-established profile. It is critical that the profile be developed up front to prevent bias and adverse selection.
• Selection involves using both the objective profile and the subjective interview process. Interviewing as a "stand alone" is one of the least reliable methods of selecting.

By defining your "profile" upfront you are bringing aboard candidates who are pre-disposed to support your culture. They are "committing" rather than complying.

You might look at this process and see it as prohibitively time consuming and "expensive" so I will share a few more data points with you:

• A recent study estimated that because of low engagement the U.S. economy is currently operating at around a 30% efficiency rate, and that was before the 2009 recession.
• The cost of individual employee turnover is estimated by the Department of Labor as ranging between 30 to 200% of the employee's annual salary, with the higher costs being associated with senior management.
• What we are "spending" on turnover and presenteeism annually could fund the costs of healthcare reform with money leftover for education, poverty, and other social infrastructure programs.

My experience has taught me that is not necessarily the team with the best players that wins, it is the team with the best players who share a common vision and purpose.

Less than 30% of organizations worldwide currently have a formal engagement initiative. So what is your plan B?