Even after working decades with bosses at all levels, from CEOs to team leaders and first-time supervisors, their ability to make inaccurate, let alone stupid, assumptions based on nothing solid still astounds me.

The smartest/most creative people only attend top tier universities. No they don’t. The wealthiest/most indebted, unless they were on scholarship, attend those schools.

I can spot instantly talent, even with just a casual conversation. No you can’t. What you can spot are people like yourself.

Hiring/poaching top talent always pays off. Not hardly. Consider JC Penny, Bob Nardelli, Marissa Mayer and thousands more at every level and in every field.

Or that a birdbrain, even the smartest, could figure out the eight steps it took to get a reward, with no coaching?

As opposed to the wisdom of crowds, assumptions are more often the bias of crowds.

Video credit: The Kat on the BBC
Image credit:  Holly on Flickr

The following points are from a profile of Marvin Ellison, CEO of JC Penney and author of its successful turnaround strategy.

He is also the guy credited with Home Depot’s turnaround after Bob Nardelli’s  disastrous run as CEO.

Ellison’s attitude and approach is the 180 degree opposite of Nardelli’s imperial, top down, command and control management style.

I was at Home Depot last weekend and in conversation with two employees who were solving a problem for me, which they did brilliantly.

I mentioned how different shopping there was now compared to during Nardelli’s reign. It turned out they had both worked at HD during that time and a couple of the stories they told were beyond belief.

If you think I’m exaggerating, or are too young to remember him, note that Nardelli is number 17 on Portfolio’s Worst American CEOs of All Time.

How different is Ellison?

The following four Ellison quotes clearly illustrate his approach.

Beyond explaining his leadership skill the quotes are solid cornerstones on which to build your own approach.

“I’m trying to understand the culture and customer. In retail, understanding those two things is essential.”

“…listening to people about what we need to do;”

“There will be change, but not for the sake of change.”

“There’s nothing more instructive than asking store employees for their opinions. I have no problem doing it.”

Hat tip to Wally Bock for pointing me to this article.

Image credit: BlackPast.org

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.