Chronic Employee Turnover Is Almost Never About the Employees

01/22/2014

bad-adsSenior executives often call me when they are at their wits end with people on their team:

  • “I’ve tried to make things work, but my VP of HR is just not delivering the results I need.”
  • “My Communications Manager just won’t step up to the plate. We seem to only react to things without any strategy.”
  • “The world changed around us, but Finance is doing the same things we did ten years ago. I’m getting no useful information and feel like I am constantly dragged into the weeds. We need to rethink what we are currently doing, but frankly I’m more worried about all the problems we are not even thinking about yet.”
  • “Our IT department is a real bottle neck. We want and need streamlined processes, better information sharing, and improved productivity. But all we get are surprise expenses, empty promises, and long delays. Even simple requests seem to get buried in obfuscation and complexity.”
  • “Our Chief Marketing Officer is not doing anything that drives revenue. We’ve spent money to upgrade our social media presence, revamp our website, and conduct extensive customer surveys. But our revenue is still flat-lined.”

Some of these concerns might sound like people problems. But twenty years of experience as an executive recruiter has taught me that what looks like a people problem is often a situation problem. An occasional bad hire is nearly unavoidable. But if you churn through executives every few years, your chronic turnover almost certainly runs deeper than just one bad egg. When your department or executive team has a pattern of failure, it’s likely that your work environment sets people up for failure (however unintentionally).

The First Law of Holes is, “If you find yourself in a hole, stop digging.” In the face of chronic turnover, don’t hire anyone new until you fix the underlying issues. Chronic turnover problems won’t be solved by blaming individual employees and then going out to immediately hire more. As Einstein noted, “We cannot solve our problems with the same thinking we used when we created them.” Instead, chronic turnover is best solved by looking beyond the individual people and exploring any issues in the work environment. Before you move forward with another round of hiring, step back and look at your own role in these seven common causes of employee failure.

1)      Are you using an outdated business strategy? Maybe the way you’ve always done things no longer works. Nothing runs on autopilot forever. If it’s the wrong task for the times, it won’t matter who you assign to do it — they will fail. The skills required for success ten years ago are not nearly enough to achieve success today. Almost every job has an increased demand for results, coupled with dramatically higher complexity and ambiguity in the work. You can’t just use old job descriptions and salary budgets to hire new people … but many people still try to.

2)      Maybe the best people are just not that into you. Do you have trouble attracting great people to your open jobs? Or do you interview great people, only to see many of them withdraw from a second or third interview? That’s a signal that you, your job, your organization, or your industry are just not that attractive to the people you want to hire. No one stands in line for an iPhone 3G anymore, even though they did a few years ago. Have you considered that the job market might have changed around you and the best people have better options elsewhere? When was the last time you benchmarked your salaries against the competition? Do you really understand who is available in your job market and who you are competing with to hire them? (Almost nobody does this kind of market research when hiring.)

3)      Are you still placing .22 caliber people in a .357 Magnum job? Growing organizations outgrow people. Your internal positions inevitably become more complex as you grow. So your next HR Manager will face dramatically different challenges than your last one. Just because the last HR Manager was willing to work for $90k does not mean you can use the same salary budget to replace her. When you hire, you need to think about the future, not the past. And if you need a new business strategy (see #1), are you ready to pay a salary premium to hire someone with those skills? Strategy never comes cheap, but far too many managers hope (in vain) to find it in inexpensive candidates.

4)      Are you disappointed with everyone you interview? Perhaps your recruiting team is only considering the people who fit your salary budget, or perhaps your recruiting strategy only reaches the people who respond to job advertising (only about 18% of the total candidate pool responds to recruitment advertising). If you want different recruiting results, you need to align your HR practices with your business strategy.

5)      Do you hire new people to shake things up, only to be disappointed after you hire them? Do you find that your people will not step up to the plate? Do you give new people big audacious goals, then disappear while they get stuck in the thicket of executing? Do you hover at the big picture level, never getting in the weeds with them, making them feel like they are going it alone? Do you ask new people to build consensus with your overworked, understaffed current team, or do you help pave the way? And when it comes to conflict — be honest with yourself — do you reward your team for encouraging healthy debate, or reward them for getting along and not rocking the boat? Change agents need more support than senior leadership usually provides them, and they always cause more chaos than their managers prefer. You can’t say you want to hire change agents and creative thinkers and then not facilitate their ability to foment change.

6)      Do your new employees charge ahead, or freeze like a deer in the headlights? There’s an old saying, “The fish stinks from the head.” Do you share the credit and take the blame? Or vice versa? If your new hires know that they will be blamed for every error, how many risks do you think they will take? Do you swiftly make gutsy judgment calls in the face of uncertainty, or do you expect your subordinates to take those risks instead? If you are always traveling or behind closed doors, is your team forced to guess at what you are thinking? Do new employees have to figure out their mistakes from group emails or other employees? Or do they get honest, direct, and regular feedback?

7)      Do you have a rule for everything? Are your employees trusted to exercise good judgment or do you have a thick set of policies for everyone to follow? Maybe your HR policies were initially designed to mitigate your legal risk, but after years of adding small edicts to your employee handbook, your office now exudes the depressing atmosphere of a police state, repelling the very people you want to attract. Police states are rarely nimble or fun. (And in a sad bit of irony, some employment attorneys suggest that all those oppressive policies might actually increase your legal risk.)

If you find yourself blaming the person who failed in a job, you’re probably looking in the wrong place. You’ll almost never find the solution there.

Before you look at new people, look at yourself. Chronic turnover problems are best solved by looking long and hard at how you might be contributing to the very problem you are asking someone else to solve.


How to Hire an Innovator and Change Agent

11/20/2013

iStock_000017017468XSmallEvery week I talk with organizations who are looking for a change agent–someone with creativity and drive, and a proven track record of kicking new initiatives into high gear.

Why do they come to me?

Because hiring managers are beginning to realize that the skills required to create a track record of success in good times (any time before 2008) are different than the skills needed since the downturn began. Managers have been disappointed by candidates who spoke eloquently about innovation in the interview but failed to deliver results. At Staffing Advisors, we live and breathe innovation. We see it up close every day within our firm, and across hundreds of searches, we’ve learned what to look for when we interview people for our clients.

So how do you weed out the hacks and the phonies during the interview process? How do you find people who are delivering results right now? Here are five of our best articles on how to hire an innovator: 

  1. How to Interview an Innovator – How can you accurately discern from the interview how a candidate will perform on the job? Separate the real deal innovators from the poseurs and empty suits with these methods.
  2. Hiring People Who Can Handle Ambiguity – Innovators often excel at ambiguous and complicated grey-area tasks. But to effectively understand how candidates handle ambiguity don’t ask,”Tell me about a time you were in an ambiguous situation.” It won’t work. Try this instead.
  3. Hiring People Who Have a Growth Mindset – A survivalist mentality crept into some workplaces, characterized by fear and risk aversion.  This outlook is counter to what’s needed to jump start growth. Here are 5 important qualities needed in people who lead growth initiatives.
  4. Don’t Believe Everything You Think – If you’re looking for an innovator, be sure to hire candidates who demonstrate successful adaptation to rapid change. What distinguishes these people? They are the ones who consistently challenge your organization’s out-dated assumptions, the ones that take the time to constantly view problems from new perspectives. Is an innovator really going to be an effective change agent for your organization if they can’t do this regularly?
  5. Why Do Change Agents Often Fail? – After you successfully identify and hire a real deal innovator, you’re not out of the woods yet – studies show that up to 70% of change initiatives fail. Fortunately, you can dramatically improve your odds using these insights from the field of neuroscience.

If all these articles make you begin to think that innovation is more perspiration than inspiration, then you are on the right track.


When Hiring, Should You Ask for Salary Requirements? It Depends on the Market.

11/04/2013

resume2I’ve talked a lot recently about how employers need to adapt to the rise of mobile job seekers – especially by making the application process less painful. Let’s tackle a related job-seeker frustration – asking that salary history be included with an applicant’s resume. A recent job seeker – who is underpaid in their current position – asked me “Is it possible to fulfill this request without revealing this information? Or do I have no choice but to disclose it?” With the job market recovering, job seekers are concerned that your compensation strategy just involves tacking on an additional 10% to their undervalued recession salary, keeping them behind the curve.

If you’re looking for a candidate with highly competitive skills, remove the salary history requirement. Asking for a salary history is instantly off-putting. High-quality, in-demand candidates will tune out and not complete the application process. And why should they? They’re being heavily recruited by other organizations that didn’t put up as many hurdles in the initial application. And they’ll likely take it as an attempt to lowball a salary offer, and steer clear.

Is the market for the position particularly scarce, where every application you get counts? Then don’t be such a stickler for the rules that you will instantly disqualify a top performer because they chose not to include the required salary history. You may have overlooked someone perfect for your organization. And odds are they didn’t include it because they want to ensure that your compensation philosophy is market-based – not based on their salary history.

Now, I’m aware that not all positions and budgets require a top performer, and not all positions are lacking in highly qualified candidates. If you’re looking to fill a dime-a-dozen position in a market with a plethora of talent, you can probably get away with including salary history in your application process. You get market data for free – so you can easily narrow applicants down to those that meet your budget. Candidates will still find the question off-putting, but the resulting few that drop out of the application process likely won’t damage your chances of finding someone to fill the position. It’s much more destructive to your chances when there’s market scarcity for the needed position.

Recently I spoke with an HR executive who had just filled out a frustrating application.  She said, “I implemented all these labor-saving components into my Applicant Tracking System, but I didn’t realize what a terrible experience the candidates were having as a result.”

Go test this – apply for a job in your own company and see if you give up before completing the application process. If you’ve instituted multiple requirements or labor saving measures, I’m betting you’ll walk away with a headache – especially if salary history is only one of many hurdles. Now imagine how many top performers did the same thing for all your past open positions.  Your search for talent might be easier (and maybe more successful) if you lower your organization’s initial barriers to entry.


Hiring Usually Gets In the Way Just When You’re Trying to Get Something Done

08/22/2013

avalancheIn a small organization, hiring gets in the way just when you’re trying to get something done. When you have your sights set on a new goal, you’re excited and ready to get moving! But then an avalanche of complexity rains down on you. You have to stop and write up a job description in that stiff  bureaucratic language loved only by lawyers. Then you need to get approval for the new job, budget for it by taking a wild guess at the salary (locking yourself into a salary before you have any idea what the good people actually cost). Next you have to write a job advertisement, think about how much you want to spend on the ad and think about where to post it. The whole business is uncomfortable, unfamiliar and extraordinarily time consuming.

Unfortunately, once you finally manage to post the job ad, things get even more complex. Now you have a stack of resumes to deal with. So you spend even more precious time sorting through and deciphering the resumes. Often the resumes that fit your ideal mental picture turn out to be terrible candidates. And you have the nagging feeling that buried in that stack of underwhelming resumes might be someone far better than their resume indicates, but should you spend even more effort sorting through hoping to find that diamond in the rough? Really, how many frogs must you kiss just on the hopes of finding a prince? You’ll probably just get warts – and lose more time. And the cherry on the top of the misery sundae is knowing that only 18% of fully-employed candidates will ever see your ad, no matter where you post it. Yup, 4 out of 5 people are busy working, and not reading job ads, so most of your ideal candidates never made it into that stack of resumes.

So you finally get to the bottom of the stack of resumes and look at the meager handful of candidates that meet some of your requirements. By this point, you’re only mildly depressed, so you begin interviewing the candidates. The first candidate arrives in your reception area. You shake their hand, bring them in, and look down at your notes. And only then do you realize that you really have no idea what to ask them about, or how to guage their answers. You don’t have a rigorous evaluation framework, no method to test the candidate’s credentials in critical areas. So you wing it, and hope you find a candidate who impresses you. But the skills that impress people in an interview are not necessarily the skills that make someone successful on the job.

Often, after all the interviews, nobody really impressed you. Exhausted by the prospect of starting everything over again, you decide instead to select one of the people you’ve already met, knowing they’re less than ideal. And since you settled for “the best of the worst,” you resign yourself to their inevitable mediocre job performance.  Of course, you would like to replace them with someone better, who wouldn’t? But, you did the best you could, and came up short, so hoping for better is futile. Of course pushing someone mediocre to meet your ideal goals is risky, so you stop bothering and accept what you get from them. After all, they would be miserably difficult to replace.

Yeah, in a small organization, no matter how many times you’ve gone through the hiring process, it just feels like you’re doing it for the first time, every time. Every position is different, so you can never approach hiring with real knowledge of who is available to you in the job market. You never actually know if you are looking at a representative sample of the best people who could do the job. You simply have nowhere to turn to ask if you should recruit more people, pay more, change the title, or rethink how you designed the job. It feels like you’re just guessing at everything, with no real answers.

Hiring Managers, the only real solution to this problem is to get it off your desk … all of it, not just the little tasks other people are willing to help with. Find someone who will accept the responsibility for the entire outcome- finding you productive staff members. Because it’s not good enough to give away little pieces of the hiring process, that still leaves you saddled with the problem.

When delegating the problem who should you look for? Find someone with job market knowledge that informs every aspect of the hiring process. You need someone to provide input into how to design the job, someone who can tell you how your job compares to other jobs in similar organizations, someone who can write compelling job descriptions that get a movie playing in the mind of your ideal candidates. But you also need to reach the 82% of people who don’t look at job ads–if you want the best people, you need to recruit them, not just hope they apply. You need someone who understands job seeker behavior and adapts to emerging job market trends like mobile recruiting. You need real market data to decide when you have enough good candidates to move forward with interviews, and when to hold back.  And you need a rigorous hiring process to help you interview effectively and reduce your hiring risk. That’s a long list of requirements, but falling short in any area only leaves you saddled with the hiring problem, instead of working on your goals.


The Pitfalls of Hiring: Judging Performance Without Context

08/09/2013

Humanity has always relied on our ability to make snap judgments of strangers so we could survive, otherwise there was always the chance of being caught unawares by a dangerous rival warrior masquerading as a peaceful trader. I haven’t heard of any recent Maryland tribal wars, but in hiring, we’re still stuck with the need to make snap judgments about people we don’t know particularly well. People-evaluation is a task prone to pitfalls. We trust our instant assessments of candidates, yet research shows we are too often prone to error. And it’s far too easy to fall into crocodile-infested waters by making the wrong judgment call.

When interviewing, hiring executives usually place huge emphasis on a candidate’s track record of achievement. But they often overlook the context of that achievement. In Why Unqualified Candidates Get Hired Anyway, article writer Anna Secino paints a picture of “businesses repeatedly promoting or hiring less-qualified managers who benefit simply by being associated with a high-growth group.” A Harvard Business School study looks into whether hiring managers are just as prone to what psychologists call the “fundamental attribution error” – our tendency to attribute an individual’s success or failure solely to their inherent personal qualities, without considering the context in which they succeeded or failed.

The results of the HBS study suggest that “experts take high performance as evidence of high ability and do not sufficiently discount it by the ease with which that performance was achieved.” If someone works in a highly successful, well operated company, and is highly successful as a result, we attribute their success to their innate ability. But if the exact same person works in a less successful company, fraught with employee tension and communication issues, and they failed at their task, we still attribute their failure to their innate ability to perform their job responsibilities effectively. We’ve discussed this dilemma before, and still love this quote from W. Edwards Deming:  ”A bad system will beat a good person every time.” Or as Warren Buffet put it, “When a manager with a reputation for brilliance tackles a business with a reputation for poor fundamental economics, it is the reputation of the business that remains intact.”

Understanding the environment that helped shape a candidate’s success or failure is one of the most important lessons to learn in hiring. So if you’re trying to hire someone, it’s a terrible idea to focus on their successes and assume that they will be equally successful in your environment. Consider the cautionary tale of Ron Johnson, who took over as CEO of J.C. Penney after huge successes with Target and Apple. He “helped make Target hip, pioneering partnerships with big-name designers like Michael Graves, and had then moved to Apple, where he orchestrated the creation of the Apple Store.” But fourteen months after the takeover:

J. C. Penney is America’s favorite cautionary tale. Customers have abandoned the store en masse: over the past year, revenues have fallen by twenty-five per cent, and Penney lost almost a billion dollars, half a billion of it in the final quarter alone. The company’s stock price, which jumped twenty-four per cent after Johnson announced his plans, has since fallen almost sixty per cent. Twenty-one thousand employees have lost their jobs. And Johnson has become the target of unrelenting criticism.

He was fired not long after. Of course, the criticism of Johnson focused on flaws that everyone seems to have considered in hindsight – he lacked CEO experience, never managed a turnaround, lacked middle-market management experience, etc. And not surprisingly, given the prevalence of the fundamental attribution error in human behavior, his failure was chalked up as a personal one, rather than one seen in the context of J.C. Penney’s difficulties. After all, “one study found that efforts at merely getting a money-losing retailer back to profitability succeed only thirty per cent of the time.” It’s extraordinarily difficult for people to separate the context from the performance – a phenomenon Phil Rozenzweig calls “The Halo Effect.”

Fortunately, if you’re concerned that you’re making these snap judgements, you may just need to take a step back, and realize that the first impression isn’t necessarily the best one. We’ve discussed this before, and suggest making sure when you’re hiring an executive, you ask plenty of follow-up questions. As we wrote in Interviewing: Are They an Effective Executive or an Empty Suit?:

Anyone can answer “Tell me about your greatest achievement.” But the gold is how you follow up on their answer.  ”How did you achieve that? What roadblocks did you overcome? Who else was on your team? What was your role on the team? What decisions did you make in the face of uncertainty? What mistakes did you make? What did you learn from your mistakes? How did you measure your success?”  That’s where the juice is. You will immediately see that the Effective Executive is much more concrete and tangible in their answers. More thoughtful. Their heads are full of metrics that they use to measure their own progress. They give ample credit to other people on their team, and often sound quite humble about their own role.


The Differences Between Interview Skills and Working Skills

07/08/2013

iStock_000013976536XSmallWe have long said that interviews are long on showmanship and short on a candidate’s proof of ability to do the job, and some interesting research reinforces our position. We tip our hat to Kazim Ladimeji at Recruiter.com, who found three new studies suggesting that hiring nervous job candidates may not be such a bad thing. Let’s break it down a little more:

The first, from Corinne Bendersky from UCLA’s School of Management, found that “extrovert traits that may them stand out from the crowd can fail in a team based situations. And the dull, uninspiring traits of introverts can make them effective on the job.” It’s easy for our biases to color our initial impressions of an introverted person, but actually thinking highly of the extroverts is also a problem for our long-term opinion of them – “at the end of the 10 week study/project period, the extroverts were seen to have lost status and to have contributed less than expected,” while instead the introverts were “seen to have contributed more than expected and gained status as a result.”

So would you rather have someone who seems nervous and is a less effective interviewer, or someone who provides a great first impression, only to let your team down in terms of their actual effectiveness? In a previous post we noted that the best candidate rarely has the best resume, and that people who are great at actually working get much less practice at looking for work, so when they are looking, they’re much more rusty at the interview process and resume crafting than those people who jump from job to job and so by necessity are excellent at interviewing.

Corinne Bendersky’s second related study actually found:

The general preconception is that the … negativity of [introverts] will be a drag on the team and that the enthusiasm and energy of extroverts would boost the team. But, in the studies the contributions of extroverts were not as good as expected and the introvert performed beyond expectations in a team environment.

So again, who are you looking for? Someone who acts the part, or someone who performs well? We’ve previously written about how to interview senior executives to distinguish between the effective executive and the empty suit.

We’re not saying that extroverts are a waste of time, and only introverts make effective executives or team members. In fact, the third study in the article found that ambiverts (those who combine extrovert and introvert traits) were the most effective salesmen. Instead, let’s recognize our biases, and how remarkably easy it is to interview an outgoing, well-practiced candidate and think they’re perfect for the job – even though they’re really just great at interviewing. Remember, interviews are nowhere near the best predictor of job performance. When you are hiring for an important position, just remember that often the real innovators are the ones down in the trenches, getting their hands dirty. And the best one just might be that nervous job candidate you were ready to rule out.


Where do you see yourself in 5 years?

07/01/2013

interview

I have never been comfortable answering the standard interview question, “Where do you see yourself in 5 years?” because I never planned my career in that way. Many people feel the same way. It’s not that we don’t have goals, but our goals are not oriented toward picking a spot for ourselves on the organization chart. Perhaps 30 years ago people in stable organizations could plan careers that way,  “I see myself as Director of ____ in 3 years,” or “I plan to be Vice President of ____ in 5 years.”

But those days are long gone. And it’s time to retire this old chestnut of an interview question.

I’ve always engaged in the types of problems that interest me, and spent my time getting better and better at solving the problems that I’m passionate about. If you show me a staffing problem, I’m endlessly interested and engaged, but if you show me an accounting problem I’m not.  With this career approach, there’s little focus on whether I will be a Director or Vice President of  ____ in 3 to 5 years. A title is not my goal. My goal is to constantly improve my ability to solve the specific kinds of business problems I’m interested in.

Interviewers, when you ask, “Where do you see yourself in 5 years?” you really are not learning much, except how well they can rehearse answers to obsolete questions. You are not learning how ambitious they are, because the whole exercise is so predictable that anyone could give you the “right answer” without believing a word of it. And if the candidate really is ambitious, and really does care about where they will be on the org chart in five years, can you promise them anything? Of course not. So the whole exercise just sets you up for a cycle of empty rhetoric. Don’t waste your time this way.

With any open position, you want a candidate who is really good and engaged in the certain types of work that position requires, so you’ll find it’s better to ask “What kinds of problems do you like solving?”  With this question, you’re bound to find out a lot more regarding where the candidate’s interests and passions are, as well as insight into whether they’re self-directed and self-motivated, and whether or not they are happy to self-train to pursue their career interests. And if they do all that, won’t you want to promote them in five years anyway?


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