Finding the right people
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In this episode, I will cover some techniques and philosophies to help you think as leaders and hire A players in your company.
Would you enthusiastically rehire everyone on your team?
if the answer is NO, then what are you doing to cut the cord of the underperformers in your organization and bring in top talent?
You can't have a great company unless you have a great leadership team; you can't have a great team unless you've got great people who work together on that team.
One Equals Three Philosophy
One A player equals the productivity of three mediocre performers
A Bell Curve
A mindset of most companies is that they shouldn't set a goal of having any more than 20%, or 25% of “A players,” or high-performance players in your organization.
The first objection is that it's hard to find good people for a specific function in a company.
The second objection is if they have a high percentage of “A players,” they will most likely ask for a promotion or a raise.
The truth is that if you have 60, 70, and 80% “A players”, in your organization, you'll be able to afford higher pay for them, and you'll be growing faster.
As a CEO, you need to strive for all “A players” in your leadership team.
Fire Fast, Hire Slow Philosophy
Most companies, just rush to hire and fire slow; making the same mistake over and over.
The objective is to fire fast and hire slow, but not the other way around
When you don’t fire a poor performer, not only are you hurting the organization, but you are hurting them– “everyone could be an A player somewhere, and as long as you are keeping them here, where they're not at that level, you're not only hurting your organization, you're actually hurting them.”
Creating A Virtual Bench Tactic
This Is the idea of “digging the well before you are thirsty”; it is always looking for people.
This tactic will help to feel more comfortable with applying the philosophy of “firing fast and hiring slow”
One of the reasons why people don’t apply this philosophy is because it is really hard to find “A players” for your organizations.
Have everyone in your organization make a list of 10 people they know and trust and that know and trust you.
Call them one by one and ask if they know an “A player” or a high-performance player that could fit into your organization.
It's not about a specific job need but talking to superstars, and potential “A players,” and you'll get some recommendations.
Then contact that referral, not for an interview but to build a relationship and potentially find an “A player” for your virtual bench.
Then set a goal to add 2 people per quarter or more on that virtual bench, and eventually, it will grow.
The longer you go without building that virtual bench, without networking and using your relationships to find the right people, the harder it will be to scale your business.
The biggest thing that holds leaders back from scaling their business is an inability to find top talent.
Do what you need to do to find the right talent; it's not Indeed, it's not Linkedin; it may not be a recruiter; it's about your relationships.
** Recommended Book: Who: The A Method for Hiring By Geffrey Smart
It talks about a methodology, called Top-Grading, which is a tool used to source, evaluate and hire great people.
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If you had a chance to do it all over again, would you enthusiastically rehire everyone on your team? Think about that; if you are the, I don't know; one in 10, one in 20 people; that answer yes to that; you would absolutely rehire, everyone on your team, then congratulations; but, if you're like most leaders, I know the answer to that question makes you really uncomfortable.
The answer to that question, the honest answer to that question, can kickstart revolutionary change within your organization. I see too many CEOs, too many leadership teams that are too willing, to keep folks who don't fit on their team; they're, they're underperformers productivity-wise; they may not be a right fit for the culture, but man, it's hard to cut the cord on somebody in the organization; if I do that, all their work is gonna fall on me; what's everybody else gonna think?
I see too many people hold on, to those underperformers, way too long; six months, 12 months, 18 months, two and three years; I also see people who rush to hire, because we've gotta find somebody for that role; so you rush to hire and you find the wrong people. You can't have a great company unless you have a great leadership team; you can't have a great team unless you've got great people who could work together on that team.
So, what I want to talk about in this episode are some philosophies, that may help you think through that as a leader; some specific techniques, to help you think through that, as a leader, of course, you know, I'll always make some book recommendations as well, but the thing I like to, follow that question up with that question of would you enthusiastically, rehire everyone on your team? Is a philosophy, that I learned from a book I read called Uncontainable, by a gentleman named Kip Tindel, who was the founder and CEO for many years of a retailer called The Container Store and Kip's philosophy on people.
[00:02:40] One Equals Three Philosophy
He called one equals three; one equals three says that one superstar, one A player, equals the productivity of three mediocre performers, one equals three; and when I talk to leadership teams about that; I typically get not only quick head nods that that's true, but people believe for some, and I've seen for some positions, it's more than one equals three; it's one equals five, it's one equals 10, it's one equals 20; If you're talking about a member of the leadership team, that impacts so many people, cascading down through the organization; impacts your clients, impacts your vendors.
If you're talking about a leader of leaders, I absolutely believe one equals three is not even close; it's one equals 10 or one equals 20; if you're talking about a kick ass salesperson, sometimes it's one equals five or one equals 10; if you're a technology company; you're talking about a kick ass programmer, it's way more than one equals three, but let's assume it's one equals three; that means you could pay your superstars double and still get a much better return on investment, than having mediocre performers.
[00:04:05] The Bell Curve
I also have organizations that think they should shoot for a bell curve; well, you know, we can only; we can only handle so many A players, and then we should have, you know, we're always gonna have some Bs, and we're always gonna have some Cs; it's kind of like a bell curve, and we shouldn't set a goal of having any more than 20%, 25% A players.
To me, that's insane; I get that, it's hard; I get that, right now, you might have 10 or 15% A players, but to say, we can't support, we shouldn't try to have more than 20, 25% A players, is a joke, and I hear it, very often and I hear it for a few reasons; I hear it, one reason I hear is just cause it's really hard to find good people; of course it is; so work hard and find good people, and I'll talk on this podcast about some of the ways to do that.
But the other thing I hear as well, is we can't have the all A players, then they'd all want a promotion, they'd all want raises; well, two things there; number one, not every A player is looking for a promotion; I know a whole bunch of, you know, A player, accounts payable clerks and accounts receivable clerks, well, I'm lying; I don't know a whole bunch of them, but I know of a whole bunch of them; A player, accounts payable, accounts receivable clerks who've been doing it for 10, 15, 20 years; and they're not looking for a promotion, they're just looking for a good job, they're looking to do a good job; so not every A player is looking for more money, and a promotion; but you know what? Let's put that aside. I promise you, if you had 60, 70, 80% A players, in your organization, trust me, you'll be able to afford to pay them more and you'll be growing so fast you'll be looking to promote them.
So we need to strive for a very high percent, I think we should strive for a hundred percent A players will; will you ever get there? I don't think so, not for a long period of time, you may get there for short spurts of time, and then maybe A person performing at an A level starts performing at a B level; maybe you hire someone you think has the potential to be the B an A and they don't work out; so I don't believe it's ever sustainably going to be a hundred percent for you; but man, why? Why shouldn't you try?
I also believe that while within an organization of 30 people, 50 people, 500 people, 5,000 people; of course, you're gonna have a percent of B players, you're gonna have some C players that, that you've gotta figure out, you've gotta coach 'em or you've gotta cut the chord on 'em. That's life, that's acceptable, but I believe on a, on an executive team, on that leadership team, that reports up to the CEO.
I don't believe there's room for anyone on that team that is not an A player or has the potential to be an A player; A players don't work for B players too long. So if you've got a COO, that's a B player, if you've got a CFO that's a B player, you, it's not getting any better as you cascade down through the organization; as a CEO, you need to strive for all A players on your leadership team; and that kinda leads me to the next philosophy.
[00:07:41] Fire Fast, Hire Slow Philosophy
The first was one equals three, the next philosophy is, fire fast, hire slow; now I know I'm stealing that from somewhere, I don't remember where, it may be from multiple places; I hope it's from multiple places because I learned, actually a few months ago, I was listening to a speaker, who said, if you steal from one person, that's called plagiarism; if you steal from 10 people, that's research . So, so this is research, I hope I'm stealing it from 10 people; but the philosophy is fire fast and hire slow; and that sounds heartless, right? The fire fast side, sounds heartless; the hire slow side sounds like a bad strategy, right? Why am I gonna take my time in hiring people?
Well, what most organizations do is they do the opposite of fire fast, hire slow; they hire fast and fire slow; and here's the way that tends to work; I've got someone on my team, hypothetically; I've got someone on my team, that's just not performing, they're performing at a C level, they're not living the culture, they're not hitting their goals; but man, if I let that person go, if I coach them, cut the cord, send them off to go work for the competition; all of their work, is gonna fall on me and other people; and man, you know, right now we're just too busy.
So, I know at some point I've gotta make that hard decision, but I gotta wait till things calm down; you ever say that I gotta wait till things calm down and then they never calm down; well, six months later, things haven't calmed down and that person's still a problem and nine months later and 12 months later, when finally, a year and a half later, I've had enough, fire that person; they're gone; I can't take it anymore, so I fire 'em.
And now, I've gotta rush to hire someone, because someone's gotta get their work done; so I rush to hire, I fire slow, hire fast, and now I make the same damn mistake, that I made before.
So we wanna fire fast and hire slow, now, fire fast doesn't mean you're heartless; fire fast doesn't mean you don't coach them first; absolutely, folks deserve coaching, they're human beings, they deserve; you hired them; you should feel some responsibility to take care of them, but you can't make a story out of an underperformer for 6, 9, 12 months.
I also believe the reason why fire fast is not heartless, is, I truly believe that everyone could be an A player somewhere; and as long as you are keeping them here, where they're not at that level, you're not only hurting your organization, you're actually hurting them; so that's the second philosophy; fire fast, hire slow.
[00:10:39] Creating A Virtual Bench
And now I wanna talk about a few tactics, and I'm sure, later shows we'll talk about a whole bunch, a whole bunch more, but I wanna share a few, and the first one is what, one of the ways you can ensure you can feel more comfortable firing fast and hiring slow, is by creating a virtual bench.
The problem, the reason why people don't fire fast and hire slow is cuz it's so hard to hire people, and when to cut the cord on somebody within their organization; now of a sudden, they say, oh my God, now we gotta put a job posting on Indeed, we gotta put a job posting on LinkedIn, uh, let's call some of those recruiters we haven't talked about in a while, and man, it's six, nine months, you're trying to find the right person.
Well, creating a virtual bench is the idea of digging the well before you are thirsty; it is always looking for people; the best method that I've heard and that I coach my clients to use, is for you and everyone on your team, very simply, make a list, right now of 10 people you know and trust, who know, like and trust you.
Some of them could be in your industry, they don't all have to be in your industry, but make a list of those folks and, and one at a time call them, and say, Hey, you know how important my company is to me and I think, you know, that we've got plans for incredible growth, who's a superstar, who's an A player you know, that I need to talk to.
Now, the obvious question, if you got a call like that would probably be, well , what kind of person are you looking for? Are you looking for a salesperson? Are you looking for a finance person? Are you looking for someone in marketing? Like, what are you looking for? And, I believe your answer should be, well, we're looking for everybody. That's good! We've got, you know, aggressive growth plans, at some point we're gonna need salespeople, we're gonna need finance people, we're gonna need product development people, we're gonna need marketing people, we're gonna need technology folks; you know, it's not about a specific job need; I need to talk to superstars, potential A players, and then you'll get some recommendations.
And when you do, you're not interviewing them for a job necessarily, if they're superstars, they're probably pretty happy; where they are right now? A lot of A players, a lot of superstars are pretty happy with their job, they're being treated well, they're doing well, they're being challenged; so they may not have a need right now, but when you talk to them, you have a cup of coffee with them or a virtual cup of coffee with them, they may not have a need for you, you may not have a need for them right now; pretty likely the case, but you wanna talk to them and you wanna get to know them, and you wanna find out if it is someone you'd love to work with, in the future; and what you wanna do is start a relationship; and then put 'em on your list to follow up with them every two or three months; just check in, how's it going? Let me give you an update on my business and what's going on by you, and at some point, they're gonna hit the limit on what they can do in the company they're with, or something's gonna change in the company they're with and they're not gonna be happy anymore; or you didn't have a need for them nine months ago, but now you've got a need for them.
So it's about keeping those relationships, and if you and your leadership team set a goal of, Hey, let's add two people per quarter, which is not aggressive at all, let's add two people, each one of us add two people per quarter to our virtual bench ,very quickly that virtual bench is gonna grow; it's not gonna help you hire your CFO tomorrow; but inside of 6, 9, 12 months, all of a sudden you've got this amazing virtual bench and when you have a need, the first place you're gonna go is your virtual bench.
And by the way, what do you think, the very last question, when you have that virtual or physical cup of coffee with this superstar that was recommended to you by someone you know, what do you think the last question you ought to ask you want to ask them is it's, Hey, who do you know that's a potential superstar?
Build that virtual bench, again, don't be impatient; I know it's not gonna help you hire someone tomorrow, but the longer you go without building that virtual bench, without using networking and your relationships to find the right people, the longer you go the harder it's gonna be, to scale your business; the biggest thing that holds leaders back from scaling their business is an inability to find the right folks; so do what you need to do to find the right folks, it's not indeed, it's not linked in; it may not be a recruiter; it's about your relationships.
And I'll kind of wrap up the episode, by talking about, uh, by recommending a book that I love that talks about some of this and, and a whole bunch more, and it's a book called, Who, The A Method for Hiring by a gentleman named Jeffrey Smart, Geoffrey with a "G" who the A Method for Hiring is a really good book, it's basically about a methodology, called top grading, which is the most powerful methodology I have found to source, evaluate hire great people.
Now, you might know there's also a book called, top Grading by Brad Smart; Brad smart is Jeff's dad, and sorry Brad, but Jeff wrote a much better book than you did; Brad Smart's version of Top Grading, it's a slog to get through, it's a big book; you've kind of feel like you've gotta be GE, to, to make it work, he actually created it while he was at GE.
Geoffrey Smart's book is a much better read, and it's also geared a little bit more toward, businesses that are not multi-billion dollar businesses, that can go do this and they talk about, sourcing, candidates; He gets very prescriptive, in the book about, you know, how you screen candidates, something they call the top grading interview, a technical interview; My clients for years have used, that methodology and it's just really, really powerful. So, if you haven't read that book, buy it .
Just to summarize before I sign off, and again, I'm sure we will have many, many more, shows about finding the right people; in fact, I've got a, guest, coming up that is an expert, in top grading that we'll talk to, but just remember that question we started with, would you enthusiastically rehire everyone on your team?
Honest answer to that is gonna kickstart, so many powerful things within your organization; remember, one equals three; one superstar, equals the productivity of three mediocre performers; like I said, in some cases it's one equals five, one equals 10, one equals 20; and remember, start today building that virtual bench.
Hope that was helpful; look forward to talking to y'all again soon.