No Exclusivity on the Best People

I’ve often said that our competitive advantage isn’t in our people; we don’t have exclusivity on the best people. (Our competitive advantage is how people work together.) Google understood this too. In fact, Laszlo Bock in his book Work Rules points out that we intend to hire the best but instead we hire the average. His telling question: how many of the stars you’ve hired actually get a superior/above average performance appraisal rating in their first year or after? If you’re like most organizations, it’s a low percentage. So what went wrong. Probably the decision-making at hiring time. Here’s an excerpt from an earlier post about it:

At a recent leadership summit, Laszlo Bock, formerly of Google, cited a study in which workers were given some decision-making ability. Those workers nearly doubled their output, reduced costs by 40% and the company profits tripled. This confirms what we've already learned from leadership gurus like Alfie Kohn (who encourages Choice in people's work) and Daniel Pink (who encourages Autonomy in people's work) in order to maintain or improve motivation.

However, this rule doesn't apply to hiring. We all think we're great at it but truthfully we stink. College sophomores were just as likely to select successful employees within 10 seconds of interaction as the hiring professionals. In fact, Google stopped letting managers make the hiring decision. Too many biases to be overcome. It's the same biases that professional scouts suffer from when they ignore the players' stats. It's the same biases that make performance appraisals moot. For example, tall people are perceived as having more leadership qualities. Instead, they had the interviewing teams, including the managers, write up notes on the candidates and then had separate decision-making team actually make the selection based on the notes. Now, it's not perfect. Our memories and observations also have biases. But the decision team probably won't get sucked in because Sally wore an outfit of my favorite color or Ralph looks a lot like my best friend.

Don't give decision-making power for autonomy's sake. Make sure that the decisions can be as objective and rational as possible.

Bock’s point is that we’ve already made a decision about the candidate in the first few minutes and the rest of the time during the interview(s) is confirming our initial impression. We will probably overlook any contradictory evidence during the remaining time.

In addition, our pool of candidates are already ‘self-selected’ as average no matter how they appear on their resume. (Some of you will balk at this.) The best and the brightest—including political astuteness, increasing organizational trust and engagement and self-leadership—are probably not looking unless they really hate their employer. If they haven’t figured out how to handle the politics, or change their team dynamics, they may not be successful at your organization either as they would have to adopt to a new culture. (Exceptions, Bock recognizes, are found through a network that ferrets out those who are trying to be excellent but the ‘system’ is hindering them; those people’s friends will make a recommendation that you should seek them out and hire them.)

So who are we hiring and how do we select for the best? Bock has suggestions, such as those above, plus an active recruitment program (beyond just referral bonus) and slow hiring process to make sure they and the candidates have sufficiently checked each other out.

And then we have the problem of hiring who will work with us and make us look good because they adapt to our leadership style. This will be a problem because, in this case also, we’re not hiring the best and brightest. We’re hiring a certain type of person. I wrote an article about this on LinkedIn and how this can be a problem for succession planning—and for the organization even in the case we get hired away.

Our Staff Makes Us Successful But...

At a recent business owners forum, there was a breakout session regarding staff development. It's an important aspect, especially when looking to sell the business. The next owner wants to know if the staff understands the business, is ready to grow the business, is ready to take on more leadership of the business, can run the business. If your staff can't, you're not ready to sell.

However, the probability is high that you've hired, promoted and developed the staff that makes you look good. They've adapted to your leadership style. They are empowered and engaged only as much as you want them to be. If you're a command and control kind of leader, you've got a staff probably that waits for orders, for you to make the decision. If you're a coaching kind of leader, you've got a staff who tries to anticipate what questions you're going to ask, take risks (sometimes foolishly) and may have a hard time following orders in risky situations. The next owner or CEO may have a different style and then the staff will be floundering, and it won't be good for the business. Hmmm, ever wonder why so many new owners, leaders bring in staff members they know from previous organizations? They're used to working together and the organization gains some efficiency in moving forward with new ideas (either generated by the new leader or the 'new' staff).

Take a look at your organization from the outside. Objectively try to assess the best environment in which your staff to operates. Objectively assess how adaptable they are. For example, if you want them to operate differently such as being more empowered, change the way you operate and see if they can adapt well to new behaviors, decision-making styles and so on. Your staff won't change until you do. I once counseled a CEO who wanted a more empowered staff: stop going to some meetings; if they insist you attend, don't say anything verbally or nonverbally (rolling eyes, raised eyebrows, deep sighs, drumming fingers); if you do say something, ask open-ended, non-leading questions and enforce 'the silence' until your staff answers. If your staff can't adapt to changes, you may need to change yourself some more or change your staff members--sort of cleaning up your mess so the next person doesn't have to--till they can adapt to someone new leading the organization.