Your Philosophy Around Talent Makes A Difference

Your Philosophy Around Talent

Your Philosophy Around Talent Makes A Difference… Having a company full of “A Players” does not guarantee success, but it significantly raises your prospects.

As a Business Coach, I have worked with many organizations and see the differences between the companies that produce short-term success, long-term success, and those that flounder. There is a vast difference in how the long-term winners build their organizations and their results versus everyone else. The factors that cause these results are known, often discussed, and rarely emulated. Your philosophy around talent matters!

Identify any company you consider great, and you will find that the greatness was 20 years in the making. You have probably heard revenue is vanity, profit is sanity, and cash is king. If you are producing high levels of success in all three measures, you should be proud. Not many companies can boast such performance. And still, you may not be built to last. What worked in the past may not work for the future. 

Most businesses will never be innovative, transformational, or trailblazers. However, all can have extraordinary growth in revenue and profits. An example most of us know is Southwest. They don’t have the most revenue (10th), largest fleet size (5th), or passengers flown (3rd). However, they broke the mold when measuring cumulative profit over 30 years. And, they copied and better executed another companies business model. 

As a business coach, I help companies build great companies and develop the best leadership practices to stay great. I help address organizational habits that cause growth ceilings. Or worse, your habits could lead to a decline or even failure. I see my job as a blind spot remover. One of the keys to your success is your leadership philosophy around talent.

First Who Then What

You can’t discuss enduring success without addressing the elephant in the room. Your business will only be as good as the people that operate in it. Jim Collins nailed it in “Good to Great, “first who then what!”

Many companies have a few great people, but few can boast the best talent throughout the organization. Most leaders will tell you that they are great at selecting people, but the data proves otherwise. Most companies don’t have the measures to know and only use their income statements as their measuring stick. The stark truth is that at least 30% of your employees are not performing and hiding in plain sight.

As I wrote in Your Business is a Leaky Bucket, even great leadership cannot overcome the limited abilities of “B” or “C” talent. Often, leaders can only go as far as those they lead. Think about it from a coaching perspective. You could have a world-class coach, but if you have a team of players with mediocre athletic ability, you’ll only get so far. The coach can draw up all the plays he wants, but the team has to execute them on the playing field. Players have to make split-second decisions and make the plays as the game unfolds. The players determine whether you win or lose. Business is no different.

Great leadership puts a person in a position to excel and succeed, but that person still has to do all the heavy lifting. It has been said that a great leader is like a gardener who plants seeds, makes sure that the soil has the right nutrients, and then nurtures the soil. The gardener cannot grow his crops, and he can only provide the right conditions for growth and plants the right seeds. 

Trust me when I say it is imperative to have A-rated talent to obtain optimal results. Then it takes leadership to keep them at that level. Now, don’t think of this as a process of rating people. Instead, it is about establishing the standards for every employee. Only after specifying measurable objectives can you hold your team accountable. Incomplete hiring and accountability practices, not putting people in the right seats where they can excel, failure to hold people accountable to key outcomes, and weakness in your culture represent poor leadership.

One of the biggest profit leaks in your company may be related to your philosophy regarding personnel. The highest cost in most companies is payroll; therefore, your biggest asset or investment is people. How seriously are you and your company taking this investment, and how disciplined are you in demanding that it produces an adequate standard of performance?

I have enjoyed coaching excellent teams and have experienced the pain of excessive numbers of wrong team members. It is no surprise that when the leadership team is weak, so is everyone else. An “A Player” will not survive a “B” leader or tolerate being surrounded by “B” coworkers. Birds of a feather flock together. We have looked at the success rate of our engagements, and Clients that put heavy investment in filling their organizations with “A Players” far outperformed the rest. Worse, companies with “B” leaders, particularly CEO, moved sideways at best. We would use the same process, same coaches, and double the effort to help the “B” team. We always fail to make sustainable progress with a “B” team.

What Are “A” Players?

 “A” players are employees who consistently meet productivity requirements (performance standards) and consistently live your company’s core values. Your productivity requirements should be set at a high bar and be readily achievable. Do not place the bar so high that it takes a unicorn to fill your position. Regardless of the role, strong performers can produce at two to three times the output of their peers. Many organizations, however, label the wrong people as their “A” players. You may be favoring people you can identify with more personally, that you have less conflict with, who have organizational tenure, who have the most institutional or industry knowledge, or that you consider loyal to you. They are not necessarily “A” players. If you are like many leaders, you may be giving more weight to only a few attributes or qualities you find important. Unfortunately, those may or may not be critical to the position’s real mission, purpose, or success.

I had a client who had an issue with his controller and was leaning toward dismissal. This was a sales culture, and the CEO favored outgoing and communicative people. He felt the controller did not fit his culture. The controller was reclusive and preferred to work in a quiet place to concentrate. Also, this controller was not afraid to tell the CEO when the company was wasting money, even if it was the CEO doing so. The controller was very focused on precision and getting things right. She often voiced concerns when other leaders exaggerated their points or made decisions with no supporting data.

The CEO failed to realize the issues he had with the controller were not related to her skills and talents. Instead, they were related to her behavioral style, which differed from the CEO. The controller’s behavioral style helped balance the leadership team and was essential to her being a suitable controller. Being the decisive and outgoing communicator that the CEO preferred was not a necessary quality for being a competent controller. The controller lived all of the core values of the business entirely. Moreover, everything produced by the department was helpful and accurate. Furthermore, she treated the company as if its assets were her own, protecting the owners.

So what causes someone to be categorized as a “B” or “C” player? A “B” player consistently lives all of your organization’s core values but is not meeting 100 percent of their position’s productivity requirements. A “B/C” player performs at the required levels but does not consistently demonstrate one or more core values. “C” players are failing to meet the performance and values standards. In all cases, anyone who is not classified as “A” should only be kept on your team if management believes they can become “A” players with proper training and coaching within an acceptable period. If not, the best thing you can do is replace them speedily.

Three Types of A-Players

Earlier in my career, I took over a new role and fired our top producing salesman. The owners thought I was nuts. We had about 20 salespeople and his book represented 20% of our revenue. What the owners were not seeing was how he affected everyone else. I spent approximately 5 hours a week dealing with issues presented because of this person, including a sexual harassment claim, which turned out to be a repeat offense. I stuck to my decision and fired him. In the end, our company, which had been declining in sales the three years previous to my being hired. After firing this toxic employee, revenue started growing immediately. Within 30 days of firing him, our largest client (representing 10% of revenue) called the President and said it was about time. They had been diverting business to our competition because they found him toxic. They immediately began ordering more from us.

There are three types of “A Players:”

A1 – They are great in their current position. We would hire ten more just like them. These people are not promotable, love what they do, and are passionate about their work.

A2 – Is someone you believe can be promoted 1 level. They have done very well in their current role and have the skills, desire, and ability to take on higher responsibilities. They can help produce more people just like them by sharing their knowledge and experience and representing your core values daily.

A3 – Is someone you believe can be promoted to two levels or more. They have traits, capabilities, and the desire to lead others.

One last comment about “A Players.” Too often, leaders create arbitrary performance standards. I have found this to be a large problem. The standards are set, and no one consistently hits them. When people miss them after giving 100%, they can be labeled as “not performing.” This leads to lower performance and eventually termination. I recommend you use much rigor in developing reasonably high-performance standards. Failure to do so costs you a lot more than you realize.

Eight Questions to Ask When Someone Does Not Perform at an “A” Level:

(1) Have you adequately communicated expectations?

(2) Has this person been an “A” player in the past? If so, what has changed?

(3) Does the person have the skills and knowledge necessary to perform his or her job at a high level?

(4) What training is required to get this person to peak performance?

(5) Has the organization created unnecessary barriers to this person becoming successful?

(6) Do you believe this person will achieve productivity within a reasonable amount of time?

(7) Does this person believe in your core values, and is he or she willing to live them?

(8) Which processes, if fixed, would lead to better success in the future?

Answering these questions will help you diagnose the issue(s). Sometimes team members are well past the rebound zone. That is, you simply cannot resurrect their performance. Other times, with a little redirection and emphasis on coaching, mentoring, or training, an underperforming person can bounce back. Either way, you have to determine the exact problem and then take great strides to address it.

Why is the “B” and “C” Performance Issue Not Being Addressed?

The primary reason employees are permitted to underperform is a lack of clarity in leadership. Leaders are often too busy doing their jobs to focus enough time and energy on what they want from their team. And when they have a good idea of precisely what they desire, often they do not adequately communicate it. Even then, performance is usually not being measured to allow a person to be held accountable.

Most sharp business owners do measure the performance of their businesses on at least a monthly basis. Still, they fail to relate that measurement to individual employee performance properly. By not requiring a specific level of performance, monitoring that performance, and holding employees accountable, you allow your employees to establish their performance requirements. Common sense tells me your employees will set lower work standards for themselves than you would.

You may be wondering how “B” and “C” performances can cost a company millions and go unnoticed and unaddressed. The primary reason: There is no financial statement line item to quantify the cost of the lost clients, lost productivity, mistakes, and lost opportunities attributable to these nonperforming players. This begs the question: Why would you ever even consider keeping a “B” or “C” player?

 When Do You Keep “B” or “C” Players?

Keep a “B” or “C” player when you confidently believe they will become an “A” player within a reasonable amount of time. If you cannot define how and when that will occur, stop fooling yourself and cut the cord. With that said, you may have to keep a person on board until hiring their replacement. At times, prematurely forcing a vacancy will be too disruptive. Be careful. I find that keeping the wrong person is costing you far more than you ever imagined.

Leaders have many excuses for not replacing their “B” or “C” players. All of the reasons boil down to either leadership laziness or just plain poor leadership. Let’s again clarify the definition of the “A” player. They are not extraordinary. They are people who meet the requirements of their positions and fit your culture. Anything less, and you are overpaying for a position.

Every company leader I have met who had a cash flow problem or was unsatisfied with their growth or profits also had a people problem. Growth problems attributable to bad strategy are the result of people problems. Companies that choose the right people (including advisors, consultants, and coaches) are less likely to have strategy problems. Think about it. The employees of any business are like the cogs that keep a machine running. Doesn’t it make sense that the machine won’t operate at optimum performance when you have broken, incorrect, or rusty pieces inside of it?

It is rare to find a company that already had the processes in place to allow them to demonstrate that at least 75 percent of its employees were “A” players. In fact, most had 40 percent or even less. Many initially believed they had 75 percent or more, but that was a wish and a prayer, as they were not tracking any performance indicators to prove their people were performing.

Research shows that replacing even one “B” or “C” player with an “A” player has a significant impact on a business. Some companies misunderstand what could happen if they commit to doing what it takes to achieve A-player performance in every position in their company. They create walls or personal obstacles, some of which sound like this:

 – There are not enough “A” players out there.

 – It will take much longer to hire people.

 – It is too complicated.

 – It takes too much workforce.

 – It can’t happen in our industry.

 – I have to fire everyone who is a “B” and” C” player.

 – “A” players must be paid more than “B” and “C” players.

The truth is that these are all myths and limiting beliefs, allowing leadership to continue to justify poor hiring practices and maintain the status quo.

The Container Store provides one of the best examples of building an organization with “A” players. I was fortunate to hear Kip Tindell, founder of The Container Store, share his formula for making a great organization. He built his company from a small start-up to one of the most respected businesses around. By enforcing an “A” player mantra, his company grew 20 percent a year to well over $1B in revenue. His formula has five crucial keys to success:

(1) Pay – They paid 50 percent to 100 percent above the industry average. Tindell knew one great person could do the work of two to three ordinary people. “A” players pay for their “extra” salary threefold, so overall labor costs are lower than the competition. His people are incredibly proud to be part of the company.

(2) Recruiting and Retention – To win, he knew he must only hire great people. “A” players only like to work with other “A” players. They do not want to be surrounded by mediocrity. They would choose to be in his company to be on a great team. They wanted more of the best and brightest out of school. This means his recruiting process had to be phenomenal to find and select the right people and never settle. This resulted in less than 10 percent turnover in an industry that typically experiences over 100 percent turnover.

(3) Training and Onboarding. Tindell provides eighty-four hours of formal training in the first year compared to the industry average, which is eight hours.

(4) Real transparency and communication. Your leaders and managers can thrive with clear communication and transparency. If they don’t feel sufficiently informed, they feel left out, and their performance will suffer.

(5) Culture is everything. Free the employees to choose the means to the ends, but tell them the foundational principles to use in making those decisions. All employees will give you 25 percent of their efforts, considered the bare minimum amount of productivity required to keep your job. To get the other 75 percent, they have to love their manager and culture.

In each of these steps, you’ll quickly come to a singular conclusion: Great leaders invest enormous time and energy into their team. They create a culture that invites in “A” players and demands an A-level performance.

 Actions to Take

What steps can you take to build a high-performance organization? Just like any machine that takes proper maintenance and attention to run smoothly. Lack of timely care to problems leads to more costly repairs. So likely, we can all agree it is much more efficient and cost-effective to ward off those repairs. People already spend enormous amounts of time interviewing candidates. They need to learn the right techniques and processes to determine whether the people they interview are the right choices for the positions. The real challenge is instilling an organization-wide commitment to high-performance standards, and practice makes perfect.

There is no one-size-fits-all sort of remedy. Different companies require different solutions. Remember that you’re dealing with real people and problems, so do not remove the compassion from the equation. Classifying someone as “C” or “B” in their current role does not mean they cannot become an “A” player in another position or possibly in their existing position, with just a little more training.

It has been said, “That which gets measured gets done!”When measurement tools are in place, leaders are shocked by how many employees fit the categories of “B” and “C” players. This performance gap costs companies millions in profit leaks. However, you can take several steps to resurrect and improve your organizational productivity.

 Six Steps to A-Player Status:

(1) For each position in your company, identify two to three key performance indicators that the person in the position has direct control over and would prove they are performing well in their job. Establish a high but realistic standard for each indicator.

(2) Communicate these indicators and the standards to the person in the position and measure actual performance versus the rules you’ve set.

(3) Establish a process for continually reinforcing your core values with all of your employees.

(4) Every quarter, review how consistently each member of your team lives your core values and meets the performance expectations of their role

(5) Put employees who are not living your core values or meeting performance expectations on definite performance plans to direct them toward achieving the desired performance.

(6) Take immediate action to help employees who are not meeting their requirements. Those who cannot meet your standards should be replaced.

 

Howard M. Shore, Founder and CEO of Activate Group Inc., is a bestselling author and serial entrepreneur specializing in liberating leadership teams from the barriers holding them back personally and professionally. During his 35+ year career, Howard has helped create over $1 Billion of value and authored two best-selling books, The Leader Launchpad and Your Business is a Leaky Bucket. Howard cut his teeth as the owner of several successful companies and executive for Fortune 500 companies like Ryder Systems, AutoNation, and KPMG. Howard has become a sought-after business mentor, executive coach, and keynote speaker. His clients work in family-owned, multi-national, public, and private companies ranging from $1 million to over $1 billion in annual revenue. With a 30-year track record of success, he guarantees any organization using his methods and systems will become more profitable, stable, and scalable.

Seven Techniques to Winning The War on Talent

employee team meeting

I am impressed by the number of companies that are experiencing revenue records. And, surprised that in a large majority of cases, business should have been much stronger. Almost all of our clients have had to walk away from business or defer revenue. The primary reason has been related to people. While supply chain challenges have been a significant factor for some, two-thirds of the issue revolves around people. The number one challenge has been having had the wrong people or finding enough of the right people.

While many leaders have pity parties, others have taken a different approach. The truth is that your people’s issues are internally rather than externally driven. Yes, there are more job openings than people actively looking. Yes, many of the people who are applying are less than ideal. However, when was the last time you did not have this same problem! While many companies struggle to fill a few positions, others add hundreds of employees per month.

One client I work with had about 60 Employees in December and is now approaching 200 employees seven months later. They are on track to hire over 50 employees this quarter. They accomplished this while many other companies in their same industry are experiencing difficulty recruiting far fewer employees. There is a clear difference in how my client has approached winning the war on talent. They chose to follow the steps of other companies that were having success and not falling into the trap of listening to others that were not.

If hiring the right people is negatively affecting your business, I recommend you keep reading…

Before I get deep into how, I want to clarify that you probably need to raise rather than lower your standards. I am finding that a primary reason for your company is that you have been building a team with misfits, half-fits, people that lack hunger, and others that may be productive and a nightmare for everyone else to work with. This significantly deters the right people from applying or accepting your offers. Remember the saying, “birds of a feather flock together.” Be careful not to build the wrong flock.

When you accept lower standards, you create significant issues. And while you may try to persuade me that it is better to hire poor talent than none at all, I will respectfully disagree. Hiring success requires that you hire someone who consistently demonstrates all your core values and produces reasonably high productivity standards over one year. Those standards typically rise over the year. Anything less is a miss-hire. When you miss-hire, here are examples of the cost:

    • Let’s assume that lower hiring standards cause hiring success to be 25% (the national average). To correctly fill ten positions, it will take 31 hires before you have to fill them with the right people. Consider how much extra burden (recruiting, productivity, management time, training, and so on) it places on your organization.
    • Wrong people suck the life out of your best people. They infect the right people.
    • Wrong people cause lost business.
    • Wrong people damage your company’s reputation.
    • Wrong people cause right people to quit or not join your company.

I am sure you are reading this and thinking, “theoretically, you can’t disagree, but what do you do when you need people, and the right ones are not presenting themselves. I have identified seven techniques companies are using right now to win the war on talent.

Allocate Proper Resources

If I looked at how much organizational time and resources go into finding more of the right people, I will bet that you would receive a failing grade. You should be willing to work as hard (if not harder) to find people as you do to get customers, service customers, and create products and services. With the right people, it becomes easier to get and keep a customer. Product quality and service levels go up. To be a top-performing company, you must build a talent acquisition model that is the standard for your industry.

In every case where a company has a recruiting problem, I find a resource problem. For every eight people to be hired in a month, you need at least one full-time professional recruiter. Recruiting is not placing advertising on job sites. That is marketing, not recruiting. Recruiting is reaching to and communicating with candidates. Recruiting is a specialty role that requires the right type of person, knowledge, and skills. Just because someone works in Human Resources (HR) and has a professional designation does not make them a recruiter. Many HR people hate recruiting, suck at recruiting, and want to be doing something else. If you need a recruiter, hire a recruiter. Another common issue is delegating recruiting to administrative staff. This is the equivalent of putting a rookie in a position that requires a veteran. This is a war and you need the right weapons and strategies to win it.

The client I mentioned above has six full-time recruiters who all make six figures. What do your recruiters make? My client’s minimum standard for recruiter productivity is 100 applicants per filled position and two people hired per week. Essentially 1 in 100 candidates is employed by my client. They make every candidate complete three assessments, undergo several rigorous interviews, and have some of the highest standards of all companies I have ever worked with.

Engage Everyone

Every person in your company should be engaged in recruiting! When you are proud of your company, why wouldn’t you? Asking people for referrals and engaging them in a process is different. Engaged means it is important to them. Ask an overworked person how you can help, and they will tell you to hire more people. Yet, they know and interact with lots of people all the time. “And birds of a feather flock together.” They need to be part of the solution. If you want more people like you have, teach them how to help fill the company with great people.

Do you have a process to engage employees? Have you provided them with the knowledge, tools, and resources to help bring in candidates? Do you have a financial incentive that is worth their time? Does everyone know what positions you are trying to fill? Do they know what to look for? Have you made the process easy for them to help? If not, you are missing huge opportunities. The right approach leads to better candidates, more candidates, and often your best employees. If you are not receiving a significant number of candidate referrals from employees, they either hate working there, or you have a bad process.

Segment the Market

Similar to identifying customer segments, you need to identify employee recruitment segments. Everyone is not an ideal candidate for your position. One of our clients hires a lot of salespeople. They figured out that many of their best employees came from the car industry. These employees were well trained, well-screened, and could make far more than if they sold cars. As a result, most of their recruitment efforts target people who work for or worked for car dealerships.

Another client needs people in construction-related work and realizes that they have high success with former military people. So all of their efforts for certain positions are focused on getting access to people that are in the process of transition from military to civilian life.

Reduce No Shows

A problem that has always existed is people who applied for positions and never showed up for their interviews. With government stimulus packages to help unemployed workers, it seems to have exasperated this issue. Whether or not that is true, you need a process that discourages these people from wasting your time. We have found that requiring applicants to complete assessments before they are considered for positions weeds out the not serious people. That, combined with a quick phone screen, can help you minimize the effects of no-shows.

Increase Process Speed

Another common I see, which often is the consequence of the resource issue I mentioned above. Does it take too long to complete your hiring process? How long from when someone submits a resume to when they can get to “yes” or “no.” If it takes more than four weeks to complete your cycle from resume to offer made, you are going to lose great candidates. The lower the level, the faster your process should be. If it is a front-line position, set your goal to a two-week cycle time. They have lots of options, this is where the biggest shortages are, and the early bird gets the worm. The longer it takes to complete the process, the less interested someone will be to work for you. Customers require speed and employees are your most important customer.

Raise Pay

For any of you that have read my book, Your Business is a Leaky Bucket, you will not be surprised to find this suggestion. There are many case studies where companies paid far higher compensation than their competition and had higher net profit statistics. This happens when you are more proficient in hiring the right people. Great people do three times the work of the average worker. Finding the best people and compensating them leads to more ideal candidates and higher retention. Don’t look at compensation, monitor return on the payroll. The later is where the secret to success lies.

Leverage Virtualization

If you are one of those people that believe that people have to work in your office to be productive, you are missing a great opportunity. While I know you likely have positions that require people to be in your office, there are many situations where that is not true. By being willing to allow people to work anywhere, you increase your pool of potential candidates. When we were hiring an executive assistant, we picked markets where we thought more high-quality candidates would be. This not only increased our candidate pool, but we also found that we were getting far better candidates in other markets. In the end, we hit a home run with the person we hired. Virtualization is here to stay and can be a key weapon in the war on talent.

Conclusion

If you can’t fill positions fast enough, have too many underperformers, it is an internal problem, not external. Put the best talent at your biggest problem. And engage all employees to be part of the solution.

Howard Shore is a business growth expert who works with companies that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or the other activate group business coaches please call (305) 722-7213.

3 Tools for Effective Employee Recruitment

Acquiring talent is a process just like any other in your company. The entire recruitment process is a sometimes long and arduous one, and therefore it is a magnet for shortcuts and rushing. Don’t give into the temptation to save a few hours of time and end up with bad candidates that cost your company thousands in the long run.

Tools You Must Utilize When Recruiting

Every recruitment effort should utilize the following three tools as the first three steps in the process:

1. Job Profile: Completely define the position as the very first step in the recruitment process. Use the job profile to identify and communicate the job description, key performance indicators, accountabilities, detailed reporting structure, internal and external customers, required competencies, critical success factors, and key process ownership.

2. Advertisement: Posting a position is supposed to attract the candidate’s attention over all the others, qualify appropriate candidates, and screen out bad ones. It is important to know where the most success is happening for the type of position and level of person you want to recruit.

3. Assessments: Employee assessment tools are an important component in your overall hiring process because it is an objective rather than subjective measurement tool. While they do not provide you will all the information you need, they do provide you with critical information you cannot get from an interview and can increase your likelihood of making a better decision. By using an objective tool, you can compensate for subjective techniques such as interviewing questions where question and answering can vary greatly and leave a lot of room for variation in opinions, different interpretation, inconsistency in application, and more chances for you to make mistakes in the process.  We have found that proper application of assessment tools can help you:

  • Save a huge amount of time.
  • Level the playing field on resumes.
  • Reduce some human errors.
  • Improve the number of qualified candidates.
  • Increase the quality of candidates that make it to interviewing stage.

Have you tried recruiting without using these three tools? What was the outcome?

Call Howard Shore for a FREE consultation at (877) 692-6211 to see how an executive business coach can help you run a more effective business or become a more effective leader.

12 Signs of Fanatical Focus on Employees

During my many leadership coaching projects, I have noticed a few things that all growth companies have in common. One of the most impactful of these common traits is fanatical discipline about their people. Do you have it?

You can say your company is fanatical about employee development if you have the following in place:

  • A clear understanding of how many people are required to achieve your company strategy.
  • An organizational chart that maps out those positions critical to your strategy.
  • Detailed job profiles for each position that identify the expected results, key success factors and the characteristics of the ideal candidate.
  • Annual updates of job profiles.
  • A process of screening candidates that allows only qualified candidates to get to the interviewing stage.
  • Training in the latest interviewing techniques to greatly minimize the opportunity to hire the wrong person.
  • An interview and background check process that includes a full development, training and coaching process ready for the new hire as soon as they come on board.
  • A 90-day ramp-up process that helps all new hires integrate with the team and start their employee development process.
  • A staffing plan that identifies potential position growth and replacement needs.
  • A process for building a ready bench of “A” players so you can expeditiously fill positions as needs arise.
  • A method to systematically eliminate “B” and “C” players from the staff and from the recruiting process.

Being fanatical about employee development takes time, patience and discipline. You must make the choice to build an employee base that is a true business asset. This requires a strategic process for recruitment and development, and a strict adherence to the process by leaders at all levels of the company.

Is your company fanatical about its people? Why or why not?

Howard Shore is an executive leadership coach who works with companies that need employee development and business management coaching. Based in Miami, Florida, Howard’s firm, Activate Group, Inc. provides strategic planning and management coaching to businesses across the country. To learn more about employee development through AGI, please visit activategroupinc.com, contact Howard at (305) 722-7216 or email him.

The Recruiting Mistake Made by 99% of Companies

Recruiting is an art that few have mastered. At AGI, we work with many companies to create systems for Human Capital Management—for each company a customized strategic system for managing employees through every stage of their employment, from recruiting to retention. When we evaluate a company’s employee processes, one of the first things we look at is recruitment.

Recruiting “A” players is the goal of most HR professionals, but recruitment is one of the areas where many miss the boat completely. That’s because 99 percent of companies start the recruitment process with the wrong tool: the resume.

Starting the candidate evaluation process by reviewing resumes is one of the biggest mistakes you can makes. Here’s why:

  1. Resumes aren’t accurate. Let’s face it, the resume is the most overinflated self-promotion tool invented. Most resumes are embellished heavily and some are flat-out inaccurate.
  2. Resumes don’t reveal personality. Resumes are, at best, clinical lists of accomplishments and experiences. They tell you almost nothing about a person’s attitudes or working style.
  3. Resumes encourage bias. Formatting, language, word choice, past employers, schools—whatever. All of these things can trigger an irrational “like” or “dislike” of a candidate that could very well be the “A” player you are looking for.

Use Talent Assessment Tools

After posting an open position, the next step of the recruitment process should be assessment testing. Candidate assessment tool like Topgrading provide revealing and unbiased information about a candidate’s natural abilities and inherent skills—these are the most important qualifiers for the successful matching of candidates to jobs.

A resume should be used only as a guide for interviews and a tool for sharing potential candidates with the hiring manager and other decision-makers. Using resumes as the first step in qualifying candidates will definitely make you pass over “A” players.

Howard Shore is a human capital management expert who works with companies that need leadership development and strategic business coaching. Based in Miami, Florida, Howard’s firm, Activate Group, Inc. provides leadership and management coaching to businesses across the country. To learn more about human capital management through AGI, please contact Howard at [phone link=”true”] or email him.

The Importance of Defining Employee Roles

Defining Employee Roles

The dynamics of your employee teams are defined by many factors, all of which determine their efficiency and effectiveness. One of the most important factors, in my experience, is defining employee roles.

In my system for Human Capital Management (the process of managing employees from recruitment to retention), I place a huge amount of focus on defining the roles of each and every employee. This starts with the job posting and carries through into an individual’s day-to-day responsibilities. As a long-time management coach, I have seen first-hand how mindfully defining each employee’s role, responsibilities and success metrics creates more success on the team and within the overall company.

I read an interesting article in the Harvard Business Review last month that really drove this point home. The article summarized a study completed by the author, Tamara Erikson, on team dynamics at the BBC and Reuters. She found that successful collaboration was better on teams when each employee’s role was clearly defined. She found that defining individual roles impacted collaboration success more than spelling out the group’s approach.

Erikson noted, “Without such clarity, team members are likely to waste energy negotiating roles or protecting turf, rather than focusing on the task.”

Carry this idea over into employees’ everyday tasks. By clearly defining employee roles from the start, not only do we target and hire the best, most qualified candidates, but we also ensure their continued success by informing them exactly how that success will be determined and measured.

What Needs to be in Every Position Description

I have been a management coach for many, many years, and I can tell you that the biggest mistake that I see managers and recruiters make time and time again, is not clearly defining individual position tasks, responsibilities and success metrics. Increase your employee and team success rate by ensuring that for each position in your organization, you have a position description that includes:

  • Job Description: Collection of tasks and responsibilities that an employee is responsible for; includes an official title.
  • Job Tasks:  Unit of work or set of activities needed to produce some result (e.g., answering phones, writing a memo, sorting the mail, etc.).
  • Job Functions: A group of tasks is sometimes referred to as a function.
  • Role(s): The set of responsibilities or expected results associated with a job. A job usually includes several roles.
  • Competencies: Abilities (skills) and capacity required to perform the job successfully.
  • Performance Management: Defines how the position’s performance is measured and its impact from an organization perspective. All the components within the performance management perspective relate and provide context to one another.
  • Critical Success Factors (CSF): Provide focus on the influences that impact the performance of the job.
  • Key Process Ownership (KPO): Identifies the critical processes owned by the position.
  • Key Performance Indicators (KPI): Provide visibility to performance through the use of metrics and established performance targets; thereby giving context to vague concepts.
  • Career History: The background experience typically required in order to have gained the level of knowledge and competency required for the position.

Without defining these extremely important position attributes, you are failing to tell employees what they need to accomplish, and without that direction your employees and your team will not deliver the results that they could be delivering.

Howard Shore is a business coach and founder of Activate Group Inc, based in Miami, Florida. His firm works with companies to deliver transformational management and business coaching to executive leadership. To learn more about management coaching through AGI, please contact Howard at 305-722-7213 or email him.

Better Candidates With Better Job Descriptions

How do you know if you have the right person in the right position? How do you know if your employees and leaders are successful? How can you tell if they are achieving what you expect of them? More importantly, how do they know if they are focusing on the right activities? The truth is, unless you have defined realistic yet challenging success metrics for each position you have no better idea of your employees’ success rates than they do. This is the basis of Human Capital Management.

Creating employee success starts with the hiring process. It starts with writing the best possible job description—I call it a position profile. The difference between a standard job description and a position profile is huge.

Position Profile vs. Job Description

Typically, job descriptions are used in job posts to advertise an open position, to determine compensation, and/or to establish a basis for performance reviews. However, job descriptions are not constructed in a manner that allows for the vetting of potential candidates or the measuring of performance—a position profile does.

The position profile identifies a role in the context of the organization, and communicates the link between business strategy, internal processes and your people.

In short, a position profile:

  • Documents the expertise, skills and experience needed to perform the job
  • Communicates expectations for performance and results
  • Detailed description of the job from three key perspectives:
    • Supervisory (Strategy & Direction)
    • Employee (Role & Responsibilities)
    • Customer (Quality & Acceptance)

By clearly defining each employee’s role in the context of the organization, and providing detailed success metrics and milestones that employees and managers agree on, you will not only target the right candidates for open positions, but you will also understand your overall team performance.

To learn more about creating a performance-based talent system for your organization, download the free eBook on Human Capital Management from our homepage.

Howard Shore is a human capital management expert and founder of Activate Group Inc, based in Miami, Florida. His firm works with companies to deliver transformational management and business coaching to their executive leadership. To learn more about human capital management through AGI, please contact Howard at [phone link=”true”] or email him.

Causing Your Own Underperformance

Causes of Underperformance in the Workplace

In every organization I have assessed, I have found the leading drivers of underperformance in the workplace are organizational recruiting and staffing effectiveness. The C-suite is the main cause of poor practices in those areas.

Generally accepted accounting principles do not have an expense line item called “Cost of Dumb Hiring Decisions.” If they did, it might well be the largest expense line item for many businesses, and companies would have to show a loss. Without taking into account bad hiring decisions and retention of ineffective staff members, current financial statements do not show the revenue you will never have, the market sector you never captured, and the excess costs you incurred because you did not spend enough time up front to really plan each new hire and then give each hiring decision 100% effort.

Performance vs. Underperformance

While the employee recruitment process is important, it is not the emphasis of this article. This article is about performance. The evidence is right in front of you on a daily basis. With only two people in the same position, you can get these varying outcomes:

  • Double or triple the difference in individual output.
  • Double the time managing one person versus the other.
  • Tons of time dealing with employee issues caused by one person while the other spurs other employees to rise up and increase productivity.
  • One person is able to do all of the assigned tasks assigned for the position while the manager must reassign some of the other person’s tasks in order to get them done.
  • One person works long hours, as necessary, without being asked while the other person leaves at “quitting time”, no matter what extra effort might be needed.

Managing Underperformance

With so much evidence that hiring the right people can have a dramatic impact on growth and profits, and that by hiring the right people you dramatically reduce your own stress, I have made this a personal mission to make it a top strategic priority.

When we work with a leadership team we ask leaders to rate their people on two dimensions: 1) consistently adhere to core values, and 2) meet or adhere to high performance standards for the position. Here is what we typically find:

  • Management has few yardsticks with which to measure the productivity of their employees. They have to guess, so it’s usually a popularity contest.
  • Management sets a low bar in terms of establishing standards for positions. We know this because the standards set are usually far lower than what the top performers achieve on a regular basis.
  • A high percentage of people do not really adhere to core values or meet performance standards, and management has decided to accept this behavior.
  • When we dig further into the accomplishments of people who management perceives as their top performers, we find that they may be performing well in some aspects (usually the pet peeves of the boss) but generally are not doing an exceptional job.

Signs That You May Be Causing Underperformance in Your Organization

Here are comments and questions I hear from leaders on a daily and weekly basis that tell me that they have left huge amounts money on the table over the years. If you are guilty of making any of these comments, it is time for organizational rehabilitation to maximize your firm’s value:

  • If someone is not hired by the time I get back from vacation, I will be really angry!
  • Why are you scheduling so many candidates for interview?
  • Why are we screening out so many candidates?
  • This recruiting process is too much work; just hire someone already.
  • A friend of mine says this person is great, so let’s bypass the process and get him/her in here.
  • That is not an important position; just hire someone.
  • Even though this is a great candidate, let’s see some more before we make a decision.
  • I know this person is not exactly what we need, but let’s hire them anyway. We can train and coach them to be what we want.
  • Why are you spending so much time with candidates?

Signs That You’re Influencing Higher Levels of Performance

Examples of comments that would indicate that leadership has made recruiting and performance a priority would include:

  • Too many bad candidates are getting through; let’s increase our screening criteria so we are interviewing better candidates.
  • We are going to treat every position as critical so we do not damage our culture.
  • We need to stick to our process or we are going to expose the company to unnecessary risk.
  • I would rather take longer to hire the right person than knowingly hire someone that does not meet our requirements.
  • What can we do to speed up the hiring process without compromising it?
  • After talking to candidates, is there a mismatch in our criteria that is causing us to slow down the process? For example, are we offering competitive compensation for the requirements we have put out there?
  • Does it look like we have created a position with requirements that have limited candidates? If so, how can we get creative to attract them to us?
  • What can we do to modify or change placement of our advertisements to attract better candidates?
  • Can you provide a report on the candidates we have had and reasons we have screened them out?

Learn How to Improve Employee Performance

An executive business coach can provide you with practical business processes and solutions to improve employee performance and accelerate your business growth. Contact Activate Group, Inc. to learn how to improve your growth potential or give us a call at [phone link=”true”].

Speed Up Recruiting

As you have seen in many of my blogs, I am not a recruiter. However, I believe that selecting talent is one of the keys to a successful organization. One of the reasons our clients sometimes struggle with sticking to the employee recruiting process is that most leaders have a high sense of urgency.

Reasons Why You Have a Slow Hiring Process

There are 4 reasons why hiring takes longer than desired:

  1. Failure to get good candidates into the process.
  2. Mishandling the candidates during the process.
  3. Finding the right fit – Candidate expectations are different than what we have to offer – Good candidate but they will not fit our company or specific job.
  4. Unrealistic expectations.

Let’s start with the last item first. Most people want to fill vacancies or replace poor performers immediately. However, just like selling, recruiting is a process. In order to get the candidates you want, you first have to fill up your recruiting funnel. Like it or not, the recruiting cycle (just like the sales cycle) has an average time frame. Sometimes we get lucky and close a deal sooner, and other times we take longer than we’d like. It is the latter that we spend our lives trying to speed up.

Steps to the Recruitment Process

The point of this article is first to understand that there is a cycle of steps to the recruitment process. Like any process, if you violate any steps, problems are going to arise and you will usually not get the outcomes you would like. The better you master each of the steps and the more disciplined the execution, the sooner you will see improved outcomes.

This sounds logical, yet many companies’ historical tendency has been to choose a candidate from whatever people are immediately available to them. This approach may achieve the desire to immediately fill a position but does not accomplish what a business person ultimate goal should be: to hire a person that fits their organization and will perform at high levels.

Making a Commitment to Recruiting

To get you to read further, I need to address one elephant that is usually in the room. To hire a person that fits the organization and will perform at high-levels takes hard work and discipline. Most leaders only see their immediate problem of replacing a poor performer or filling an open position. However, for every client I work with, the data is so huge that it takes a lot less work in the long-term to hire right the first time; not to mention the volumes of research showing that the top performers give you so much more productivity than an average performer. Committing to the hiring process should be a no-brainer.

How To Speed Up The Hiring Process

Here are some key ideas to speed up your recruiting and address the other 3 reasons why successful hiring takes longer:

  1. Spend the time up-front to fully understand the skills, behaviors, motivators, knowledge, and experience required of your ideal hire.
  2. Make sure that everyone in the hiring process agrees with and knows number 1.
  3. Advertise effectively. If you do not advertise often enough or in enough places, if your advertisement is not attractive to candidates, or you are advertising to the wrong audiences, you will not have enough candidates in the funnel.
  4. Stop using resumes as your initial screen. We have found that by using assessment and phone screens we are able to consider a lot more candidates and that many of the best candidates would have been lost had we used the resume first. In addition, resumes do not have the information we need and many of the good candidates get screened out.
  5. Monitor performance of each step in the process weekly to know if you have to make any changes. Many times there is a break in the process or there is a weakness that can go on for weeks and months before anyone does anything about it.
  6. If you are screening out a lot of candidates, ask “Why?” If the rejections are for the right reasons, there is nothing wrong with the process… be happy. Too often managers become frustrated when they see “too many candidates” coming through, so they attack the process, causing bad decisions.
  7. If you have followed a strong process: assessments, phone screen, in-depth interview, and tandem interviews, and the candidate is great, do not let him/her get away. I have seen too many companies lose good candidates because they want to see one more candidate for comparison.
  8. If you have someone in the process that is naturally indecisive, do not give them the final word.
  9. If you have someone with a history of bad hiring decisions, they should be removed from the process. History repeats itself. These are the people who consistently hire and reject candidates for the wrong reasons and will not follow the process.

As you look at hiring talent over the next year, ask yourself “Am I committed to hiring right or just hiring?” Hopefully you will choose the former. If you do, then your discussions around hiring will be more about how to improve the process and increase speed of the steps rather than causing you to hire the wrong person.

Cost of Hiring New Employees

It is not often that I hear my business coaching clients use “hiring new employees” and “strategy” in the same sentence. In fact, before hiring me and beyond the typical tactical issues with employees, it was rare for human resources issues to be considered during strategic planning meetings. I recently met with one of my clients regarding challenges they encountered in recruiting sales personnel, and it became obvious that their tactical issues were really related to their strategic model for hiring employees. Worse even than their tactical issues was the fact that it was costing them a huge amount of money to hire new staff members.

Commonly Overlooked Costs Associated With Hiring New Employees

Before discussing the strategic issues of my Miami coaching client and how we wrestled them to the table, I want to clarify what I mean by the “cost of hiring new employees”. Here are some costs you probably do not measure, and they are the big ones:

1. Hiring Success Rate

The lower your hiring success, the more people you have to hire to get a full set of performers. For example, if you need to add 10 people, but your hiring success rate is only 25%, you will ultimately have hired 31 people before you have the 10 people that will perform at your required performance levels.

2. Hiring & Performance Standards

Most companies are lowering their performance standards rather than raising their hiring standards. They get frustrated by their inability to recruit the right people and take whatever they find available. The lower performance requirements result in excess employees, lower customer service, more mistakes, lost opportunities, and lost customers.

3. Leadership Time

Leadership has to divert significant time to interview extra people, manage superfluous people, and address the performance-related issues of substandard employees. This brings far less value to the company than the leadership activities they would perform otherwise. Unfortunately, there is no separate income statement line item for the above. In every company I have visited, the financial statement impact is huge when we start trying to quantify the above numbers. This is what I am referring to when I am concerned about the cost of hiring new employees:

How Business Strategy Impacts the Hiring Process

As I was working with one of my customers in Miami, they were explaining to me that 2,000 candidates had applied for 10 open sales positions over a 6-month period. They ended up being very disappointed with their results. Very few candidates were qualified. They had tried hiring a few new employees, several of whom never showed up for the first day, and, of the ones that did show up, they were not pleased. They were looking at all the time that was passing and how much money the employee hiring process was costing them. They were losing money on sales that were not generated by having an open position, sales that were not generated by people that could not perform, and the cost of management time applied for recruiting. After reviewing their situation, we realized the situation was a strategy issue.

Considering All Factors in the Employee Recruitment Process

When developing a strategy, you need to consider the people decisions related to that strategy. In every company, there are several key positions that must be filled quickly in order to grow your business. In my client’s case the need was for additional salespeople. If your business model requires a unique individual (in other words, someone with a skill that is very unusual, hard to find, hard to attract, etc.) and you will need a lot of them to grow to the levels you want, you have a bad strategy. The solution to this is to change the model so that you will be able to staff your model. My coaching client and I looked at the cost of hiring problem and realized that he was not considering all the factors in the recruitment process and addressing them wisely. In their case, they wanted people to work on a commission-only basis, be highly experienced in my client’s industry, and be a seasoned salesperson. It should not have been a big surprise that none of their ideal candidates were biting. The people that were biting required different internal support systems, and the company was not set up to help them be successful.

Understanding the Costs of Hiring the Employees You NEED

So here is how we attacked the problem. We broke down candidates into 3 groups: No Experience, Sales Experience/No Industry Experience, and Sales Experience with Significant Industry Experience. We then discussed the implications of risk, internal system support, ramp-up time required, compensation systems needed, and search strategy. What we learned from the process was that they had 4 different sales positions, two of which could not be successful without significant industry experience. Compensation needed to be very different for these people versus the others. We concluded that the client’s current internal systems and processes to support the strategy they had chosen were severely inadequate. These revelations were critical. Failure to identify and address them would certainly have resulted in continued frustration. By addressing the disconnect between how they were approaching people decisions, their operations, and their strategy, my client was in a much better position for success. This was a clear case where the cost of hiring new employees was much greater than they realized.

Improve Your Hiring Strategy

Howard Shore is an executive coach and founder of Activate Group Inc. based in Miami, Florida. His firm works with companies to deliver business coaching to improve executive leadership development. To learn more about executive leadership coaching through AGI, please contact Howard at [phone link=”true”].