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Archive for July, 2007

Cultural change

Tuesday, July 31st, 2007

Richard Fouts has a great post pointing out that communications, no matter how clear, isn’t enough to effect a change in corporate culture and detailing the importance of developing the correct processes. Good stuff and he’s bang on.

But even before a CEO considers the processes and the communications required for the change, she’d better consider her MAP and the MAP of not just her senior staff, but also all managers in the organization.

Fouts mentions the radical change in processes needed to effect the transformation that Jeff Immelt believes necessary at GE, but Immelt’s biggest challenge is changing GE’s collective MAP from one that was paranoid about missing the numbers to one that values innovation and celebrates failure (links to several stories here).

True cultural change requires still more. It’s one thing to put new processes in place and communicate them to your people and another to commit to building the trust that proves they’re real.

If developing the processes and communicating them to your people takes months, then convincing then that the changes are real requires years of sustained effort—in fact the effort never ends.

Significant cultural changes necessitate often-difficult changes in people’s MAP—changes not all will be comfortable with—and that means yet more change, as those who can’t change leave and new people join.

Bullies and performance

Monday, July 30th, 2007

Does your newspaper carry The Born Loser by Chip Sansom? Actually, I don’t find Brutus, the main character, to be a loser—just a slightly naive guy who works for an arrogant bully who constantly belittles him.

In the July 26 panel the dialog is as follows:

Boss: I am looking for a unique spin to put on our new ad campaign—do you have any ideas?

Brutus: Gee, Chief, I’m not sure—are there any ideas you think I should think of?

Boss: Brutus Thornapple, master of thinking inside the box.

it reminded me of managers I’ve known, who, no matter what happened or what feedback they received, never could understand that it was their MAP and their actions, not their people’s, that was the root cause of their under-performing groups.

After all, if you

  • ask for input and ridicule those who offer it, why be surprised when you stop receiving input;
  • claim that you want to solve problems while they’re still molehills, yet kill the messengers who bring the news, you should expect to grapple with mountainous problems requiring substantially more resources;
  • tell people their ideas are stupid, whether directly or circumspectly, or, worse, that they are for thinking of them, why should they offer themselves up for another smack with the verbal two-by-four?

So, before you start ranting or whining about your group’s lack of initiative and innovation, try really listening to yourself and the feedback you get and then look in the mirror—chances are the real culprit will be looking straight back at you.

Got People? Why good hiring is the flip side of successful retention

Friday, July 27th, 2007

Congratulations! You got funded! Your new product is a hit! You’re ready to grow!!! No problem. There are tons of resumes on the web-just help yourself, right? It’s free, right? And easy, right? Wrong!

First, start with time—everybody’s time. You have to find the resumes and screen them. Then you have to interview them—three, four, five, more? Oops, blew the in-house compensation curve because you offered an out-of-sync package and sign-on bonus? Whoops! Lost one to the competition because the process took too long?

Get the wrong person and you’ll yell for disaster assistance; get too picky and you’ll have late product releases, missed deadlines, or lost business opportunities. That’s why the average real cost of hiring one $60K IT professional starts around $75,000-and goes up. You may not even know the final figure for a year or more.

So, what do you do?

  • Motivate! Tie incentives, whether cash or stock, to accomplishing company goals as opposed to individual ones. Used this way, incentives short-circuit negative feelings and politics—people ignore anything or anyone that gets in the way of their bonus—and that keep’s your people’s focus where it belongs.

How? If four developers are each working on a piece of code for the same project, tie the bonus for on-time completion to the whole project. That way, each of the developers has a vested interest in helping and motivating the other three.

  • Prepare! Don’t staff by comparative shopping. Know before interviewing what you really need.

How? Take the time to write a really complete job req (requisition), including

  • your culture—because the person has to match, or, at the very least, be synergistic, to it;
  • management style—the type you have and/or the type you want;
  • description of the job—a complete overview including all responsibilities;
  • synergy—compliment the current team, don’t duplicate in-house expertise;
  • likely interaction—both the intra- and inter-departmental interfaces;
  • trade-offs—if you got X, would you give up Y;
  • reality check—would you want the job when you were at that point in your career;
  • experience—what “been there – done that” do you want or need; then
  • Shrink it—our Minimum Hiring Rule states: “Hire the first person through the door who meets the minimum requirements for the position.”

How? Reduce the wish list to the absolute minimum in attitude/style/experience required to get the job done before you start interviewing; then stick to it. The person who has 150% of one minimum and 5% of another is not a fit; neither is the person everyone really likes, but who lacks half the minimums.

  • Save time! Our 70% Rule: “Be 70% sure you want to hire the candidate and have the candidate 70% sure she wants to join, before the on-site interview.”

How? Have multiple, key people do full (1+ hour) interviews by phone, not quickie screenings, and do them conveniently (outside working hours), and fast (no more than a day between calls and preferably less). As long as you never invite a candidate on-site who doesn’t meet the minimum requirements, in most cases you will need only one on-site interview to make the hire.

  • Sell, sell, sell! Know your culture, the job, the people, everything, and tell it like it is. Don’t fudge!

Why? The best way to guarantee a bad hire and low retention rate is to fudge about the company, job, career path, management style, future, people, hours, market, technology, etc. Fudging isn’t just outright lies, it includes omissions and spin. Why hire somebody who won’t stay? Money is about number five on most people’s “reasons to join” list, so know your culture and use it to your advantage—because the person who joins you for money will leave for money!

  • Speed wins! The entire process, from seeing the résumé to candidate acceptance, should take no more than 10 working days, and fewer is better.

Why? Speed is the cheapest, simplest way to impress a candidate! Remember your own feelings when you couldn’t get a response? And that includes saying “no.”

To wrap-up, here are the main points to remember: Be fast, know what you need before interviewing, don’t lie, spin or fudge, constantly sell, and remember—the flip side of successful retention is good hiring.

Protecting your corporate culture

Thursday, July 26th, 2007

“Can we keep our corporate culture as we grow? If yes, how do we go about it?” These are, if not the most asked then definitely in the top five, questions that I hear.

The short answers are, “Yes” and “Through a lot of hard work and tough hiring decisions.”

Unfortunately, that’s not the answer a lot CEOs want to hear—or do.

But if Google can successfully transplant its Silicon Valley culture to grow from three to 20 international R&D centers in less than three years, you can sustain your culture, too—if you’re willing to do the work.

Kannan Pashupathy, Google’s Director of International Engineering Operations, says, “We actually do a very strong test for culture fit, and that’s something everybody looks at. In addition to your raw smarts and your analytical thinking and your problem solving and your grade-point average, we do a very strong culture-fit test.

Part of that culture-fit test is to look for people who have an open mindset, people who think there is a richness in different cultures, that they can learn from everybody and hierarchy is not important and ideas are. If you’re in the company, you’re already somehow predisposed to thinking or at least aligning yourself in that direction.”

In other words, no matter how good the first three are, Google will pass on a candidate who isn’t, at the least, synergistic with its culture.

Retaining your culture means interviewing far more candidates than it takes to find the first three criteria and the toughness to walk away from sometimes dazzling candidates who, no matter how brilliant and skilled they are, just don’t fit.

So the next time you find yourself in this situation stop and think—is it worth selling your company’s culture down the river just to avoid more interviewing.

It’s your choice, but everyone will end up sleeping in the bed you choose to make.

Convenient easy vs simple easy

Wednesday, July 25th, 2007

An interesting article in Computerworld about the dangers of an IT “culture of convenience” got me thinking.Not so much about its effect on IT (although it’s enough to keep you awake nights), but about the role convenience plays in so many management screw-ups and how much worse it becomes when it takes root in the company culture and managers MAP.

Think about it. Convenience equals easy and easy is rarely good. It’s easier to

  • zone-out watching TV than to help with the kids homework/exercise/do housework/create something/read a book;
  • kill the messenger than fix the problem;
  • play favorites than develop a meritocracy;
  • fight fires than develop strategic plans;
  • fire employees than develop them;
  • instill fear than build trust;

large or small, the list goes on forever.

And convenient/easy doesn’t equal simple. Although simple things are usually easy to do, making them simple, AKA, easy, in the first place was most likely difficult and took time, effort and patience.

But the simple/easy that comes at the end of that process is totally different from the easy that results from convenience. In fact, they’re polar opposites, just as the results of each are—one positive and the other negative.

Convenient/easy or simple/easy? Which do you choose for your MAP and the culture for which you’re responsible?

As I keep saying—it’s your choice.

Please choose wisely.

Refusal to answer sends negative message

Tuesday, July 24th, 2007

A candidate recently posed a question on Startupping asking if a company should share its valuation when offering shares.

After 20+ years recruiting for startups, another nine consulting/coaching startup CEOs, including a specific approach to giving out stock options, and, shortly, releasing a software program based on our option allocation methodology, I really wanted to grab the execs in that company and shake them. But if I shook every exec who wonders if they really have to tell, I wouldn’t have time to do anything else.

But just to be sure, I asked a serial entrepreneur I know what he thought and here’s his answer.

“Well, I suppose it’s not actually illegal to refuse to disclose facts about your stock plan to a candidate. It’s kind of stupid, like saying, “we can’t tell you what we are going to pay you when you join, but it’s going to be reasonable.” Who would accept that as an offer? Questions about the size of the total stock pool, the valuation of the company, the current option price and the percentage that the candidate’s initial option represents of the total stock are all fair and realistic questions that a good candidate would ask, and if the company refuses to answer them, I think the candidate should immediately get the idea that there’s something screwy with the management of the company.”

That’s really the crux of the matter. Essentially, the company is saying, “We want you to work for us, but we don’t trust you, nor do we consider our business any of your business.”

Whoee, is that an attitude to impress a candidate or what? Wouldn’t you just love to work for someone who asks for, but gives not?

Further, having staffed for startups, I know that the last thing you need is a high level of naiveté. If your candidates don’t ask about valuation it’s up to you to explain it anyway—and keep explaining until they truly understand—because if they don’t understand they have no reason to bust their buns at the level required in a startup.

Whether this company’s response was due to ignorance or information control issues it’s a very likely harbinger of their MAP and its resulting culture.

How to Run a Company

Monday, July 23rd, 2007

Enviable stats: 2006 revenues 1.9 billion; 31 years of consecutive revenue growth; no debt; 10,087 employees worldwide; 4% turnover.

According to Jim Goodnight, founder, president and CEO of SAS International, the world’s largest privately owned software company, ‘Employees don’t leave companies, they leave managers… More than anything else, you want to create an environment where people are respected-and treated like they’ll make a difference… I think the success of the company has been, to a large degree, due to the benefits we provide because it has made our people very happy, to want to stay on… My philosophy has always been: You either spend money on your employees, or you spend the same amount of money on headhunters, recruiters, on training, on lost-productivity.’

No doubt about it, Goodnight has great MAP, but it’s doubtful that Wall Street will ever learn the lesson and adopt his philosophy. However, you can—even without being able to fund the same benefits.

Start by really respecting all your people. I know too many managers who only respect their ‘stars’ and then wonder why turnover is rampant in the rest of the organization.

Provide as much tangible proof as possible that you value your workers, from health care to chocolate, but don’t kid them that the company can’t afford something that is obviously feasible. You’re people aren’t stupid, they know the score, and if you want to build trust then tell them the truth.

No matter how great, those benefits don’t give you the right to disrespect them. It’s not a tradeoff—you don’t get to micromanage, insult, play favorites, or bully your people just because the company offers health insurance.

Things you can do

  • Check out turnover rates in your industry, compute your own—whether for your company or just your group—set a reasonable improvement target, then work to achieve it.
  • Evaluate your MAP by talking to your people and really listening—even when you don’t like what you’re hearing—and work on changing it.
  • Find out what else you can change/offer that would make a difference; do as many as you can and be honest about why you can’t.
  • As the song says, ‘little things mean a lot…,’ so add as many small gestures as possible to show your appreciation.

The bottom line—if you treat your people as replaceable don’t be surprised when you have the opportunity to do so.

Solving a talent crisis 8 (a multi-part article)

Friday, July 20th, 2007

After listening to Josh at that first meeting, Corrie decided that the first thing she needed to do was a major overhaul of the company intranet, hence her request for additional help. That, and researching new technologies, became Randy’s major focus.

Before we get into the IT end of things, let me remind you that I am a Luddite wannabe. My involvement on this part of the project was in the form of ideas and considerations, i.e., things that needed to happen to preserve the close connections, both intra and inter-team. In other words, along with the professional interactions they needed to preserve a vibrant virtual water-cooler. It had to be fun/interesting/useful/cool or folks would be unwilling to spend their most precious resource—time—on it. So what I’m going to describe is more in the category of goals, why stuff was needed and general solutions, not specific brands or products, since they change quickly and new ones appear, nor detailed descriptions of how any of it was/is accomplished.

Everybody received two webcams, one for the office and one for home.

Everybody received a USB flash drive.

Because so much proprietary information is available on the intranet, collaboration functions and flash drives, Corrie opted to switch login security to a biometric fingerprint reader, instead of passwords, for both home and office.

Employees receive company assistance, including tech support and hardware/software upgrades as needed when they start working remotely.

Every department has a high-end teleconferencing unit, with extra units available from IT.

They added virtual whiteboards and other collaborative software.

Meeting software that includes voice and records it for future viewing/listening is available to each department.

Several different wikis were immediately set up

  • Us is a directory of all the expertise, knowledge and skills, hard and soft, available within the company. It’s the go-to source when anyone needs help or information.
  • Them is a directory of clients, vendors, and other outside resources, with continually updated commentary on doing-business-with, including the people and politics involved. It’s invaluable for helping newer workers to avoid rocking the boat or succumbing to a bout of foot-in-mouth.
  • Each department has its own wiki to use as they see fit.
  • The company FAQ is an easily searchable, heavily annotated collection of worker wisdom. It’s set so nothing is deleted, just added, and is monitored for inaccuracies by each department.

Getting to know you is a MySpace type function gives everybody their own place to talk about family, friends, hobbies, doings, post videos, pictures and dozens of recipes.

A homework help and tutoring function is in development.

URLs from anywhere on the intranet are set to act like this one, USB Flash Drives and Portable Storage for Computers, (from a Google search for “flash drive”), but using the fingerprint reader.

Just how cost-effective is all this? When Josh and Doug crunched the numbers, they found that the costs, including estimates for interviewing time and lost productivity, just to replace Doug, Kelly, Tom, Warren, and Katy, paid for all the new technology, training, and Randy (as an intern), with some left over. That, along with the savings achieved on the rest of the hires and the phenomenal leap in productivity pays for the other expenses, such as air fair, temporary living, childcare, IT, etc.

Another substantial savings has come from the 100% retention rate—the new approach, together with the extraordinary culture and careful hiring, has made the company recruiter-proof.

In spite of how I wrote this, it hasn’t been easy, and it’s won’t get any easier. As the company grows there’s pressure to ease the hiring process, lessen the time new hires spend on site, reduce distance worker fly-ins, eliminate the childcare, etc., but Josh and Doug have the numbers on their side and the Board’s full support, so it won’t happen.

As Josh says, why fix an engine that’s not broken and do it with substandard parts.

Solving a talent crisis 7 (a multi-part article)

Thursday, July 19th, 2007

Obviously, the scenarios described over the last week didn’t take place in a vacuum, serially, as fast or simply as described, nor did Julie’s conversion from “You’re out of your mind” to True Believer happen overnight, but it did happen.

Early on Josh presented his vision to the whole company and solicited feedback, ideas, technology suggestions, etc., but asked that people keep their discussions internal. He said that until they had a basic framework in place that could be adapted fairly across the board he didn’t want to be inundated by people who thought it would be cool to work when they felt like it.

He made it clear that adopting and integrating distance working and a results-only environment successfully would require tremendous effort and trust by everyone. He said to be patient if it seemed to move slowly; it was more important to do it right than do it quickly.

Brad and Julie represent the two extremes among both managers and workers, at all levels in the company; most were in the middle with a cautious “show me how it works and I’ll try it” attitude.

In the end, Julie’s, conversion was a combination of desperation—she had to get staffed because the work had to get done—and her complete trust in Josh, her team and her company’s culture—none of which let her down. Also, Julie grew exponentially as manager and leader, which was a nice side benefit.

Brad learned that it wasn’t as easy as he thought it would be, but he’s fully staffed now, one distance worker and one local, and his team is making major strides for the company.

Doug has continued his stellar performance and manages to interact more with staffers now via technology than when he was on-site. He hired “Diane” as financial admin/benefits coordinator. Diane was just starting her pregnancy and was ecstatic to learn that she could keep her position after the baby came.

Sales is set to grow in the second half due to a new product release and “Ken,” the head of sales, is adamant about finding sales stars wherever they may be; to that end he’s redesigning his entire department from the ground up with the help of his current team.

“Corrie,” who handled IT alone when all this started, immediately asked for and got an additional resource in the form of an intern, “Randy,” who accepted a full-time position upon graduation. With all the growth, Corrie recently asked for another part-time intern, “Jen,” who will go full time when she graduates in 2009. (More on IT tomorrow.)

Once the geographic and time restrictions were lifted the company was able to fill all its positions through internal referrals and in about half the time it took previously; this in spite of a much longer interview process. The mangers use the same process for local hires, too, since remote communication skills are just as important. That same process has resulted in higher productivity from new hires, while attrition has dropped to zero.

Continued tomorrow…

Solving a talent crisis 6 (a multi-part article)

Wednesday, July 18th, 2007

Before approaching Josh, Julie googled Suni to see what additional information she could find—it turned out to be quite a bit. She found a resume, several papers, his thesis, technical discussions in which he’d participated and a Facebook page that was probably the reason he was still available.Julie took Ashok’s glowing recommendation along with everything she’d found to Josh for evaluation; he agreed that it all looked excellent. His concern with the Facebook information was whether it pointed to a lack of common sense or just the typical duh factor he found so prevalent in younger candidates. They agreed the issue would sort itself out during the interviews.

Julie wanted to know exactly how Josh was planning to handle new distance workers. It was one thing to bring back someone she knew well, but integrating someone brand new into the team was totally different.

Josh said that he hadn’t worked out the entire plan, but he did intend to have any new hire work on site for three to six months whether they were local or not—in fact, he’d already worked out a special leasing arrangement in a nearby complex—and had asked the senior staff for input—concerns, approaches, suggestions, ideas, etc.—as a starting point.

Suni’s referral had come before the input could be developed into a cohesive framework, but Josh felt that wasn’t enough to warrant ignoring a potentially good candidate, so they would just move forward slowly with lots of input from the others. If that meant they lost him, so be it. Julie heartily agreed, since she knew that it took very little to tear a team apart compared to the effort and time it took to build one.

Julie called Ashok back and asked him to let Suni know that she’d be calling him, mentioning that she’d googled him so she already had his resume. She also suggested that Ashok give Suni as much non-proprietary information about the company and its products, culture, etc., as possible. Ashok was delighted.

In their first conversation Julie explained that the company followed RampUp’s 70% Rule, treating phone interviews as “real interviews,” so that they (the company) would be 70% sure that they wanted to hire him and that Suni would be 70% sure he was interested in Julie (as his manager), and the company/position/team before arranging for him to fly in.

She explained that he wouldn’t have to relocate permanently, but that he would need to live locally for several months until he had integrated into the team and was up to speed on the products/work. The company would supply housing, a modest per diem, at least one long weekend home each month and a rental car during that time. Julie explained that using distance workers was a new idea that they were still developing, so, if he was hired, he’d be, to some extent, a guinea pig as the program progressed. Suni responded that it sounded incredibly cool and that he had no problem as a guinea pig.

At that point, Julie turned the conversation to the interview. Over the next ten days, approximately 15 hours of interviews with the senior staff, including Josh, as well as staffers from engineering and marketing, took place and everyone was enthusiastic; Suni was so excited he offered to buy his own ticket just so he could meet everybody.

When they did fly Suni in, it was for eleven days. Suni asked if there was some work he could do while he was there, he thought it would give everyone a better idea of what he was capable of and how well they would work as a team and it would also give him a better understanding of Julie as a manager.

Julie and Josh thought it was a good idea, but, to avoid any legal hassles, they agreed decided to pay him for the hours he actually worked.

By the end of the week Julie knew she’d found the right person, and there was no question that Suni felt the same. Even the Facebook issue was resolved. It turned out that the first thing everyone had done was google Suni, and vice versa, and the amount of kidding he took over his posts made him realize that it was smarter to keep his pages private.

When Suni was hired, he asked if they would mind his not using the apartment. He said that “Randy” had invited him to live with his family and that would be much nicer than being alone. Julie was delighted and Josh immediately arranged to offset any costs that Randy incurred.

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