THE POOL OF competent, dependable employees is shrinking. The object today is not simply to hire the best person, but to retain that person.
In “Simple and Inexpensive Hiring and Retention Tools,” Ron Wolff and Steven Sill laid out a rather grim picture of the work force, but offered hope in the form of personality-assessment tools — particularly Caliper, which Sill has used for over 10 years at Aspen Equipment Company.
Wolff said that it's a universal problem that was created in part by the tech boom around 2000, when burgeoning dot-com companies procured talent from other companies.
“The problem of pirating people from one another is that at some point, it winds up recirculating mediocrity,” he said. “A lot of Baby Boomers are getting ready for retirement. As a result, the back end is that you have employment conditions where there are fewer people coming into the work force. When you have an economy that starts to grow exponentially and a flat and declining birth rate, you start to run out of people.”
He said the Federal Government is the country's largest employer, but 67% of the employees are eligible for retirement now. He said that at the current rate of economic growth, there will be five to eight millions jobs that can't be filled.
“That gets a little bit frightening,” he said. “It's a phenomenon that will get worse before it gets better. The challenge for us when we can find experience is, can we identify and hire people who have potential? And then, can we retain them?”
He said Human Capital Management is the fastest-growing area in human resources, with accelerated change meaning that a company's ability to respond is often the difference between success and failure.
“It's very important, regardless of the size of your business, to take a look at the jobs periodically and what you're asking people to do,” he said. “At some point in time, there is a business environment out there where a company says, ‘I want to participate in that. OK, here's what I'm going to do.’ A mission statement says, ‘Here's how I want to participate.’ Then I set some goals: how many things I'd like to sell.
“The key result is that I look at what kind of people I need. You create a job description and hire someone. This is the way it's been done for 100 years. But what happens now is there are events in the economy, and the business environment will shift. That means that business owners and managers need to react, whether formally or informally. We adjust our goals and how we're going to do it. Maybe instead of getting a new business and fabricating, maybe I'm going to repair equipment. We find that many businesses don't bother to look at the impact on jobs and people currently in their employ.”
Why people leave
He said there are four major reasons why people leave companies: money, job dissatisfaction, who they work for, and the business culture.
He said the warning sign is that a top performer's performance starts to tail off over a period of 12 to 18 months.
“You may be asking them to do things they didn't do before and you may be gradually pushing them out of their area of comfort and into discomfort,” he said. “You have to start to look at the root cause of why people are leaving. It is very costly to go out and replace a key person in your organization.”
He said an attempt needs to be made to understand what makes people tick.
“We do that by looking at their personality,” he said. “How are they wired?”
He said when a gap is found, there are three choices:
“Can I ‘train away’ the gap? The technology is changing, You're taking on a new line. You need people to be familiar. Can I send them to a school to bridge the gap?”
“Can I ‘manage away’ the gap? Sometimes, because there is such specialization — a lot of companies want to get people to work together as a team.
“If not, you may have to refill the position — cut bait. This is the most difficult choice a company makes. If they can't do the job, everybody in the organization is going to pay. So either re-deploy the person or cut bait.”
When you hire, the first thing you do to match who they are to the job is to look at the technical competencies the job requires. Those are the prerequisites the person needs in order to be successful.
Then there are supervisory/management competencies: the ability to be innovative and creative; to make judgments and decisions; to plan and organize; and to manage performance by telling people whether they are doing a good job.
Those can be expanded into observable behaviors that give rise to high performance:
The ability to be innovative by building on other ideas, questioning work practices in an effort to identify improvements, supporting implementation of new ideas, and thinking outside the box.
“Let's face it: We all get set in our ways,” he said. “That can become critical in an environment of rapid change. People need to be flexible. Does somebody look beyond the roles out there and say, ‘Is there another way to skin this cat?’”
The ability to make judgments and decisions by making sound judgments within areas of things known, tried, and tested; reflecting on pros and cons of a number of options and deciding in a timely manner; and making decisions even when they can be unpopular and controversial.
“Nobody likes to give bad news to anybody,” he said. “But sometimes you have to to improve. It's a fine line we walk. You don't want supervisors who drive talent out the door because they're nasty to work for.”
The ability to plan and organize by planning ahead for predictable peak activities; knowing in advance when a deadline will not be met; setting aside time each week to plan and organize the workload.
The ability to manage performance by assigning tasks and responsibilities taking an individual's capabilities and workload into consideration; giving specific and motivational praise at appropriate times; and working with individuals and team to improve performance.
“One of the biggest turnover issues is that we find conscientious, hard-working people who are terrible self-promoters,” he said. “They are the most vulnerable part of your organization. The minute they sense an organization that appreciates what they do, they leave. They are the silent ones who sneak away on you.”
Interviews aren't the whole answer
He said key performance indicators are measurable outcomes that are the results of performance in supervisory/management competency areas; the number of jobs completed on or below budget; client satisfaction ratings; project downtime analysis; employee ratings of the supervisor; and number of jobs delivered on time.
He said part of the problem with interviews is that “we give them the store. In some cases we sell them on the job before we even ask them what they've ever done. You want to get a sense of what they are like instinctively.
“Consider a team interview to see how this person deals with different people. If they're going to have to converse with people in your organization, you want to see how well they can do it. Ask them, ‘So what can you tell me?’ Put the onus on them. If they can't do it in an interview, I'd strongly suggest they're probably going to struggle on the job.
“Attempt to replicate the job atmosphere. Use polar-opposite questions. Ask them a question that has two extremes, and ask them to pick one and say why.
“The whole secret to hiring is getting a lot of information that lines up and says, ‘Yes, this makes sense for me.’”
He said personality profiling has been around for 40 years. The ground rules:
Make sure you conform with the Equal Employment Opportunity Commission (EEOC) and the Americans with Disabilities Act (ADA).
“These were never meant to be a silver bullet. They are incredibly helpful, but they're another data point. They're like X-rays for a doctor. It confirms, clarifies, or potentially uncovers something they never saw.”
The story of Aspen
Sill, president/owner of Aspen, has 123 employees and is rapidly growing.
“We need all the help we can get to assess people,” he said. “Interviews are great, but they're not the whole picture. All the interview and resume information comes from the interviewee. It's biased. It has to be. They're answering questions the way they think you want.”
He also said resume fraud is abundant: a recent survey showed that 70% have engaged in achievement embellishment.
“Maybe your sales grew by 35% and you're saying 70%,” he said. “Plus, 35% of resumes have a newly created fact that is an out-and-out lie. A Fortune 500 CEO from Radio Shack claimed he had a degree in theology that he didn't have.”
He said personality tests are unbiased.
He also said that in hiring a branch manager one time, he advertised in newspapers and never got a resume out of that. So he hired a nationally known headhunter firm that said it used personality profiles. The firm sent Sill the profiles for five applicants, and four of them were identical.
“They were computer-generated and they weren't looking at the variables,” he said. “It didn't give me the information I wanted. None of the five got the job.
“A lot of these outfits won't give a recommendation. If they won't step up and make a commitment, I won't use them.”
He said Caliper is the best company he has found for personality profiles because it will “talk to you about the individual's ability to do the job.” There are 29 areas of personality that are grouped into clusters.
He has learned to trust the recommendations.
“Early on, there were several opportunities where we were fired up about a candidate, then we gave the personality profile and Caliper said, ‘We don't recommend this individual,’” he said. “But we hired them anyway. Eventually, we got rid of them. When we went back into the profile, all the information was there. We chose not to listen to it. And we don't do that anymore.”