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Role Model: Craig Zoberis and Fusion OEM

Wednesday, January 25th, 2017

http://www.fusionoem.com/

In 1914 Henry Ford doubled his workers’ daily wage, much to the consternation of other magnates, who believed, as do most of them today, that success comes from paying as little as possible.

Ford, however, believed that he would benefit if his workers had disposable income and he was correct; they used the extra money to buy Fords.

The same holds true today; modern research has proved that higher wages increase profits.

Businesses, from very large to very small, still don’t believe it and scream at the thought of a so-called living wage.

But not all of them.

Fusion OEM at just $12 million is considered very small, but it’s profitable and founder Craig Zoberis is very happy, because he is meeting his twin goals.

While lots of other manufacturers have moved operations to China or Mexico, Zoberis has kept his plant in the United States – and considers it a point of pride to pay his 55 workers above-market rates. Workers with no experience start at $14-an-hour, he says, and by completing training and gaining skills can reach $18-to-20-an-hour, plus overtime and bonuses, for total pay near $50,000 a year, within a few years.

Zoberis doesn’t expect his people to buy his products, but he did want to have a  place to work that matched his MAP and not his father’s.

My father and his partner never did a good job of hiring the right people with the right attitude. I wanted to be excited to go to work every day, and working for my father’s company, I was not.

Fusion OEM has never had a layoff, but finding great workers in its industry is just as difficult as finding great programmers, hence the need for a creative, long-term solution.

My colleagues were always complaining that there aren’t enough skilled workers who have the right attitude. When I talk about skilled workers I’m talking about machinists (…) What we discovered halfway through our life at Fusion is that we couldn’t always look outside for skilled people. We decided to hire for attitude and train for aptitude.

Fusion OEM is enjoying double digit growth, but Zoberis isn’t interested in taking outside investment. He loves going to work, saying, “This is my hobby, my income, my life,” and knows that hyper growth can kill you.

You can’t grow your company any faster than you can get the right people. If it goes too far, you might go beyond your capabilities and you’ll fail.

The interview is well worth reading, especially their approach to hiring and compensation.

I rarely make predictions, but in this case I feel pretty safe making two.

  1. Zoberis will continue building his company, growing his own people and being a management outlier.
  2. Most companies of whatever size will continue to treat people as disposable, pay them as little as possible and bitch about them to whomever will listen.

Image credit: Fusion OEM

Where To Work

Tuesday, January 24th, 2017

https://www.flickr.com/photos/jeepersmedia/9698637692/

There’s a very stupid myth that only the very talented are hired by startups and that the very talented only want to work for startups.

The corollary being that those who work for public companies, let alone large ones, probably aren’t all that talented and certainly not innovative/creative.

What a crock.

Another part of that myth is that working for a startup is the road to riches.

An even bigger crock.

The myth also says that the best place to work is a unicorn, such as or AirBnB, GitHub or Palantir,

And that is the biggest crock of all.

If you are looking for new opportunities and are dazzled by the idea of working at a unicorn I strongly suggest you read Scott Belsky’s post on Medium.

A company’s fate is ultimately determined by its people, so talent is everything. But this old adage bumps up against another one: cash is king (or runway is king, for a fast-growing private company). Without runway, talent takes off. So, it is no surprise that bold moves to extend runway (think late-stage financings at technically large valuations with some tricky liquidation preferences underneath) are done even if they could hurt the company (and its people) in the long run. This is especially true when these financings are ego-driven rather than strategic. The problem is, the employees at these companies don’t understand the implications.

But whether startup or Unicorn, this anonymous post on GitHub is a must read.

This is a short write-up on things that I wish I’d known and considered before joining a private company (aka startup, aka unicorn in some cases). I’m not trying to make the case that you should never join a private company, but the power imbalance between founder and employee is extreme, and that potential candidates would do well to consider alternatives.

The right place for you to work is the one that satisfies what you want — whether that’s the opportunity to work on bleeding edge technology, build a network, upgrade your resume or even plain, old curiosity.

The wrong place is the one you join with an eye to getting rich quick or for bragging rights.

Image credit: Mike Mozart

Golden Oldies: Paying For Hires Upfront

Monday, January 2nd, 2017

It’s amazing to me, but looking back over more than a decade of writing I find posts that still impress, with information that is as useful now as when it was written.

Golden Oldies is a collection of what I consider some of the best posts during that time.

Greetings and welcome to 2017. I thought we’d start the year out with a bit of critical hiring wisdom, especially since hiring so-called stars is still high on most founders’ agendas.

The problem is that hiring often reverses the old adage, ‘one man’s junk is another man’s treasure’ and the promised star is, in the new environment, a dud. (Note: the compensation described is from 2007.)

Read other Golden Oldies here.

My entire career, even when I was a headhunter, I’ve condemned guaranteed pay packages and sign on bonuses, whether stock or cash, because of a passionate belief that people who join just for money/stock have no loyalty and will leave for more money/stock and that what a person did for their previous employer is not a guarantee of what they will do for their next one.

Obviously, my efforts have had no impact whatsoever, outside of my own clients, especially in the executive suite.

The practice is now so common that it’s been named the “golden hello,” a sure sign of broad acceptance.

Such packages are based totally on candidates’ historical actions for another company, frequently in a different business, their interviewing/negotiating skill, charm, and the threat that doing so is the only way to acquire their talent.

Just how much is all this worth? Penny gave its new COO “…a base salary of $750,000, to be reviewed annually starting in 2007, with a cash bonus that could be as much as 150 percent of her salary…stock option awards and restricted stock awards valued at more than $20 million in recognition of forfeited benefits at her former employer, Capital One, as well as a minimum cash bonus for 2006 of $1 million.”

She was fired six months later, because “…Ms. West not being a good fit for the company,” according to Deborah Weinswig, a Citigroup analyst.

Further, “…Ms. West had a severance agreement and that the retailer intended to honor its terms.” and you can bet that her golden goodby will contain a goodly portion of her golden hello.

I understand executive paranoia and the desire not to lose what they already have, but change always involves risk.

Penny isn’t talking, but if the analyst is correct about the fit, why was Ms. West hired in the first place?

Who wrote the job description? Who interviewed her? Who checked her references? Who thought she was such a good fit that it was worth doing anything necessary to land her?

“Who,” of course, is plural, nobody, especially at senior levels, is interviewed by just one person any more.

That’s why I keep telling my clients that, as their companies grow, they must make hiring, including skilled interviewing, a core competency at all levels.

Golden Oldies: Vested Self-interest In Action

Monday, December 12th, 2016

It’s amazing to me, but looking back over more than a decade of writing I find posts that still impress, with information that is as useful now as when it was written. Golden Oldies is a collection of what I consider some of the best posts during that time.

To truly understand this post, you need to click the link and read the original explanation of VSI. VSI isn’t particularly original, but it is rarely called that — people prefer nicer or more professional sounding euphemisms. And that’s OK; I just prefer to opt for clarity and simplicity — which is why I’m considered too blunt.

Read other Golden Oldies here.

vsi-successTuesday I shared my version of VSI, the main ingredient in motivational sauce, and today I want to tell you a story about how it works.

Earlier this year I was working with a client, Jim, on various management approaches, such as offering good feedback and open sharing of all information, i.e., not dribbling it out over multiple requests, that he wanted to integrate into the company culture. During the conversation he asked me “What can I do to open the minds of some of my managers?”

Unfortunately, there is really nothing you can do to force a person to change the way they think, but there is much you can do to encourage it. I honestly believe that the fastest, as well as the most potent, way to encourage change is good old VSI.

I used to believe that people had to perceive the need for change before they could change, but based on experience I’ve found that if they see benefits to themselves from doing things differently they will start moving in that direction and the results can be almost surreal.

Jim had a manager who was known for making his people come to him constantly to get the information necessary to do the work they were assigned. His attitude/actions resulted in higher-than-normal turnover in his group, but he insisted that he wasn’t doing anything and people could get the information at any time, so there was no correlation.

Using VSI, Jim and I worked out a two-prong approach to change his behavior.

  • 20% of his annual bonus was tied to reducing his group’s turnover by 30% (which would bring it in line with the company as a whole); and
  • Jim started doing to the manager as he did to his group by forcing him to come and ask and then dribbling out the information he needed to meet his targets.

Part of the manager’s reaction was straightforward—he grumbled a bit about the retention bonus. But the surreal part was in his reaction to the information plug—nothing, not a word or an action to acknowledge what was going on.

However, he must have noticed, because within days of it starting he was giving more complete information to his people.

Not all at once and not very graciously, but he loosened his hold on the information flow, so did Jim. If the manager backtracked Jim tightened up and the manager learned that to get he had to give.

At first, his people were cautious, not really trusting the new openness, but after about a month the results started and after six weeks they took off like a rocket—productivity and retention zoomed north, while grumbling and discontent headed south and on into oblivion.

But the surreal part is that, in spite of his people commenting publicly on how differently he was handling assignments, meetings, etc., to this day the manager claims that nothing changed and certainly not him.

Image credit: Street Sign Generator

Entrepreneurs: Motivational ‘Duh’

Thursday, December 1st, 2016

https://www.flickr.com/photos/anchovypizza/4222126794/

Tuesday I commented on the ‘duh’ factor in relation to Amazon finally eliminated forced ranking reviews, AKA, rank and yank, recognizing that they did nothing to foster teamwork or improve retention.

Like I said, “duh.”

Today we have Facebook offering up another duh moment.

Facebook is trying to accommodate millennials and its younger predecessor by talking to each worker and figuring out how their individual skills can be used to make a more personalized career path, not something more traditional and cookie cutter-like.

Definitely duh.

I defy you to think of anyone who works at any job and any level who doesn’t prefer this approach.

Take a look at what turns on/off the so-called silver-tsunami  of Gen X and Boomers.

Millennials may walk faster than Gen X and Boomers when they don’t like the culture, but that, too, will change as they take on more responsibilities, such as kids, mortgages and aging parents

Whenever I hear how different the needs of millennials are compared to previous generations I’m reminded of these words from Socrates.

“Our youth now love luxury. They have bad manners, contempt for authority; they show disrespect for their elders and love chatter in place of exercise; they no longer rise when elders enter the room; they contradict their parents, chatter before company; gobble up their food and tyrannize their teachers.”

Give it a rest.

You hire individuals and need to manage them as such.

So put away the cookie cutter and provide everyone, no matter their age, with an environment in which to grow and flourish and the tools needed to do it.

That’s your job in a nutshell.

Flickr image credit: David

Ducks in a Row: Amazon Finally Kills Its Forced Ranking.

Tuesday, November 29th, 2016

https://www.flickr.com/photos/44412176@N05/4197328040/

Yesterday’s Golden Oldie referenced Jack Welch’s responsibility for the atrocious forced ranking system followed by so many large, and even not-so-large, companies.

… a review process known as “stack ranking” or “rank and yank” in which employees are rated against each other as opposed to how well they meet their job requirements. (…) Using it long-term tends to create a dog-eat-dog kind of culture.

That changed drastically under Jeff Immelt, GE’s current CEO, as described last year.

According to Raghu Krishnamoorthy, the head of GE’s in-house management school,

“Command and control is what Jack was famous for. Now it’s about connection and inspiration.

But not at Amazon, because Jeff Bezos walked in Welch’s shoes on many levels, including reviews.

… the review process was described like “choosing sacrificial lambs to protect more essential players.” (…) Bezos believed managers needed to raise the performance bar with every new hire so that the only employees that rise through the company would be the ones considered exceptional.

Until last year.

There is nothing like public embarrassment (humiliation?) via the New York Times to encourage rethinking one’s actions.

It took a more than a year, but Amazon is finally changing its review process.

Bezos is slow; Microsoft ditched it in 2015 and Marissa Mayer never managed to implement it, although she did try.

Amazing how it’s only taken 30+ years for management to figure out that setting employee against employee does not foster teamwork.

All I can say is, “Duh.”

Image credit: gorfor

Golden Oldies: Management is Like Coffee

Monday, November 14th, 2016

It’s amazing to me, but looking back over more than a decade of writing I find posts that still impress, with information that is as useful now as when it was written.

Golden Oldies is a collection of what I consider some of the best posts during that time.

There’s not a lot to add to this post. The cited research is still accurate, as is the results comparison. That said, many managers are still providing too much, too little or, worse, none at all. But their complaints haven’t diminished, nor their solution to shift the responsibility to their people, instead of recognizing that they are the ones who need to change.

Read other Golden Oldies here.

http://www.flickr.com/photos/25187937@N05/5525163305How much management/coaching is too much?

I hear that question a lot.

Most managers want to do a good job and are looking for ways to improve.

But, as one commented recently, if you do everything recommended by the experts you would use so much of each person’s time that productivity would tumble and even the best coaching would have a negative impact.

Which is why I say that management and coffee are similar.

In the right amount coffee is good for your brain and may help you live longer.

The right amount of management/coaching is good for the brain in that it provides challenges that foster growth; it also lowers frustration and stress, which enhances mental and physical health.

According to the research, the “right” amount of coffee is around 20 ounces a day, i.e., one venti-size Starbucks.

That equates to the most effective management/coaching, which provides all the information needed to do the job at one time (not more nor less) and then gets out of the way while staying accessible if needed.

Many of the coffee-fueled are more likely to drink three to five ventis a day, which is detrimental to health and longevity.

A comparable amount of management/coaching is detrimental to health, productivity and retention.

Flickr image credit: Kurtis Garbutt

Golden Oldies: Customer Service Week 2016

Monday, October 10th, 2016

It’s amazing to me, but looking back at more than a decade of writing I find posts that still impress, with information that is as useful now as when it was written.

Golden Oldies is a collection of what I consider some of the best posts during that time.

In case you didn’t know, today is the start of Customer Service Week, focusing on “the importance of great customer experiences to the success of the organization and reinforce a customer-focused culture.” “Customer” typically refers to the people who buy your product, but they aren’t your only customers, especially if you’re a manager. That’s why today’s Golden Oldies includes two posts, with several links to additional, valuable information on the subject of customers and how to keep them. One new link seems worth including; it explains why, unlike other fields, the constant practice involved in active customer service can seriously reduce empathy — an absolute requirement of great customer service.

Read other Golden Oldies here.

http://www.flickr.com/photos/angelaarcher/5166009978/Who is Your Customer?

Customer service is a major topic these days (more on that tomorrow); as is employee retention, but do they really have anything in common?

Absolutely.

Every manager, from team leader to CEO, is also a customer service manager, because your people are your customers.

That’s right, customers.

More accurately, that makes you an ESM—employee service manager.

Why do you service your people? To

  • help them achieve their full potential;
  • assure high productivity;
  • lower turnover; and
  • create an environment that’s a talent magnet.

How do you service your people? By

  • cultivating the kind of MAP (mindset, attitude, philosophy™) that truly values people and understands how important it is to manifest that;
  • offering high-grade professional challenges to all your people and making sure that they have the resources and all the information necessary to achieve success;
  • fostering fairness so that people know they are evaluated on their merits and favoritism plays no part; and
  • always walking your talk and living up to your commitments.

What’s in it for you?

  • Better reviews, promotions and raises;
  • increased professional development;
  • less turnover and easier staffing; and
  • what goes around comes around—everything that you give your people will come back to you ten-fold!

Flickr image credit: Angela Archer

https://www.flickr.com/photos/jurvetson/6467405231Employee Retention: Not Rocket Science

Yesterday we looked at how a new IBM analytics tool that analyzes tweets found that customer loyalty was severely impacted by employee turnover.

A decade ago research by Frederick Reichheld found that a 5% improvement in employee retention translated to a 25%-100% gain in earnings.

Deloitte recently released its annual survey, which seems to back up the need for improved retention.

2015 Global Human Capital Trends report, their annual comprehensive study of HR, leadership, and talent challenges, the top ten talent challenges reported for 2015 are: culture and engagement, leadership, learning and development, reinventing HR, workforce on demand, performance management, HR and people analytics, simplification of work, machines as talent, and people data everywhere.

The first three are nothing new; the terms have changed over the years, although not the meaning behind them or their ranking as top concerns.

In a major employee retention push, companies are turning to algorithms and analytics to mine a raft of data, identify which employees are most likely to leave and then try to change their minds.

But some things never seem to change and until they do companies won’t make much headway.

At Credit Suisse, managers’ performance and team size turn out to be surprisingly powerful influences (emphasis added –ed.), with a spike in attrition among employees working on large teams with low-rated managers.

With decades of research saying the same thing, it makes one wonder why the finding was “surprising.”

In fact, nothing will change until companies, bosses and the media stop being surprised every time a survey shows that talent acquisition and retention is most influenced by

  • the culture in which they work;
  • the bosses for whom they work;
  • the work itself; and
  • the difference they can make.

Gee, maybe it really is rocket science.

Image credit: Steve Jurvetson

Golden Oldies: Staff R (not) Me

Monday, September 26th, 2016

It’s amazing to me, but looking back over a decade of writing I find posts that still impress, with information that is as useful now as when it was written.

Golden Oldies is a collection of what I consider some of the best posts during that time.

Last Tuesday, We considered the bottom line value of gratitude, which reminded me of a post from 2009 when I wrote a leadership blog for B5 Media. Good morning. Thanks. I appreciate X. So few words, so little effort and such enormous returns.

Read other Golden Oldies here.

different_1Back when I wrote for B5 media, Phil Gerbyshak over at Slacker Manager quoted an interesting statistic. He said that “7% of employees leave their managers because they didn’t say good morning.”

In the conversation that follows, Roger says, “I have always been of the ilk that I don’t always say “Good morning” to people in the office. I have felt that once a week is good enough… However, this is probably just a reflection of what feedback I personally need. As a manager I have to think that others are different and have different needs.” (Current links unavailable.)

Phil Gerbyshak over at Slacker Manager quoted an interesting statistic. He said that “7% of employees leave their managers because they didn’t say good morning.”

In the conversation that follows, Roger says, “I have always been of the ilk that I don’t always say “Good morning” to people in the office. I have felt that once a week is good enough… However, this is probably just a reflection of what feedback I personally need. As a manager I have to think that others are different and have different needs.”

I worked for a guy like this. Oh, he said good morning and was a really nice guy, but he didn’t understand that our needs differed from his.

Most of us are like that to some extent. We see the world through our own MAP and unconsciously make the assumption that others see it the same way.

This is especially true with regards to people we’re close to, such as family, or with whom we’re friendly, such as team members, peers, colleagues, even bosses.

Think about it. How many times have you recommended a book or movie only to have the person ask you why in the world you suggested it; or introduced two people you really liked only to find that they can’t stand each other.

My old boss didn’t care about pats on the back, positive feedback or congratulations when he accomplished a critical piece of the sales process. It’s not that he wouldn’t do it, but he just didn’t think of it on his own.

I still remember one time that I closed a really big deal. He was out of the office, so I put the paperwork dead center on his desk where he couldn’t miss seeing it. He came back mid-morning, but it wasn’t until I went to his office, asked and he congratulated me—but when you have to ask, it has no value.

And even when he did say the right thing it was obvious that he didn’t know why he was saying it. It wasn’t that he didn’t mean it, he did, but he never really understood why it needed to be said.

So more important than saying the right thing; saying it at the right time; or honestly meaning it; is taking the time to learn and understand why you’re saying it.

Image credit: flickr

Golden Oldies: Ducks In A Row: Do You Have People Or Persons?

Monday, September 12th, 2016

It’s amazing to me, but looking back over more than a decade of writing I find posts that still impress, with information that is as useful now as when it was written. Golden Oldies is a collection of what I consider some of the best posts during that time.

Companies are fond of calling those who toil for them by different names. ‘Human resources’, which morphed to just ‘resources’ was one of the first. Then came ‘talent’. Next, the pendulum swung back to ‘people’. Managers, on the other hand, have always talked about their ‘people’. But no matter what the company or manager called them, they were individuals; each with different skills, goals and passions — and need to be managed as such.

Read other Golden Oldies here.

ducks_in_a_rowDo you work for a company or a manger?

If you ask most people who they work for they’ll name a company, but if you ask them why they love or hate it, stay or leave, they’ll usually mention a manager, the people or the culture, which is a projection of the manager and the people.

People quitting is expensive and bad for team morale, but having them quit and not leave is the worst thing that can happen.

Think about it, who do you manage? And How?

Adequate managers manage employees.

Good managers manage people.

Great managers manage persons.

Yes, persons.

Individuals, because you can’t manage (or lead) everyone the same way.

The same words often mean something different to different people, so you need to say what’s necessary in whatever words will ensure that each individual hears and understands your message.

I’m not saying that it’s easy, but you aren’t paid for easy—you’re paid for results.

And knowing how to manage persons is the best way to ensure that your people won’t quit.

Image credit: ZedBee|Zoë Power on flickr

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