Category Archives: small business talent

Why Netflix Doesn’t Tolerate Brilliant Jerks

What do you do when someone who is unquestionably brilliant is also a jerk?

We all work with someone who is unquestionably brilliant. You know the type: the person who consistently comes up with great insights and ideas and who can cut to the quick far faster than anyone else in the organization. It’s hard not to step back and admire how the person’s brain works.

Continue reading Why Netflix Doesn’t Tolerate Brilliant Jerks

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When to Delegate? Try the 70 Percent Rule

If you don’t learn to embrace the art of delegation, you won’t be able to build your business. The 70 percent rule gives you guidance on how to do it well.

So when do you delegate a task? This central question stops many CEOs from moving tasks to their team. Continue reading When to Delegate? Try the 70 Percent Rule

3 Simple Steps To Hold People Accountable

Great leaders and managers know these 3 Simple Steps To Hold People Accountable

There is a common theme that many leaders struggle with: they don’t know how to hold their people accountable. Even if they are great at hiring A players, many leaders still are left with that feeling that their people could be doing more or better work.

Rather than first finding fault with the employee, a great leader looks first at him or herself. And when you take that look in the mirror, you might find that you have not been effective at holding your people accountable for their results.

The good news is that you can rectify this today and become a better leader with the help of three simple steps: Continue reading 3 Simple Steps To Hold People Accountable

5 Trends That Will Impact Your Business in 2018 (You Might Already Know No. 3)

With the New Year right around upon us, here are 5 trends that will impact your business in 2018 and beyond:

  1. Lack of “Place” Accelerates

In the coming year, we will continue to see a diminished importance of the need to have a physical location to work in. Thanks to the widespread evolution of mobile platforms, where we now have high-performance computers in our hands, most of us can now work from anywhere.talk to us Continue reading 5 Trends That Will Impact Your Business in 2018 (You Might Already Know No. 3)

How to Scale Your Company By Shifting From Talent to Systems

 

Eventually you can’t count on superhero employees and have to deploy systems if you want to scale.

In the earliest days of most companies, entrepreneurs can’t afford the systems that exist in bigger companies. Instead, entrepreneurs rely on hiring super-talented people skilled in doing everything from serving clients and delivering products to closing the books.

Continue reading How to Scale Your Company By Shifting From Talent to Systems

Are Your Employees Firefighters or Snow Cones?

Every business has the occasional fire. When it hits, you should have plenty of people who we call “Firefighters” while avoiding folks we label “Snow Cones.

“Every business, from successful startups to well-established corporate giants, hits a rough patch or two. It’s just a part of doing business.

But if you’re going to weather those storms as an organization, you’ll need people who can handle the heat and won’t melt under pressure. In other words, you should be hiring plenty of who we might call “Firefighters” while avoiding bringing on folks we might label “Snow Cones.” Let me explain.join_now Continue reading Are Your Employees Firefighters or Snow Cones?

Mercenary or Patriot–Which Should You Hire?

When you’re hiring, think beyond the skills and experience a candidate might have and assess whether you want a patriot or a mercenary.

When you’re thinking about hiring people, especially those in mission-critical-type positions, you need to use caution because the stakes are so high anytime you make a bad hire. But beyond whether they are an A, B or C Player and the skills and experience a candidate might have, you also need to assess whether they are a patriot or a mercenary. Let me explain.talk to us

The Patriot
Patriots are employees who seek to join your company because they believe in your organization’s purpose and mission. They want to contribute to the cause. Maybe they are drawn by what your company does or how you do it because it resonates deeply with their own personal beliefs. This can be a very powerful draw for some job candidates, many of whom might even be willing to make personal sacrifices like taking less pay, relocating their family or even working long hours for the opportunity to be part of your organization. Patriots are also deeply loyal to the organization and tend to stick around even when times are tough and the bullets start flying. We often see startups filled with people like this who choose a job based on its higher purpose rather than higher pay because the organization doesn’t yet have the resources to offer much in terms of compensation.

The Mercenary
Mercenaries, on the other hand, choose their next job based on how it will benefit them as an individual. You can identify a mercenary right away just by looking at their resume, where you’ll find lots of short tenures and plenty of job-hopping – something that’s common in job areas like sales and software developers. That’s not to take anything away from a mercenary’s skills: they are usually very talented and in demand. The tradeoff is that, unlike the patriot, if a mercenary’s personal needs aren’t being met, they are likely to jump ship at the first sign of trouble. Usually, they are just there for the money.

Why The Distinction Matters
One reason its critical to understand whether you are hiring a patriot or a mercenary is that your choice will impact your culture. Patriots are the people who live your culture on a daily basis and do things the way you want them done. Mercenaries, on the other hand, don’t always think the rules apply to them – especially if they are producing results.
While mercenaries can be very valuable to the growth of your company, you need to understand that they also carry a risk to your culture – at least depending on your business model. If you run a bond trading firm, for example, you might rely on a staff of 100% mercenaries – and that’s a good thing. But for most of us, especially those of us who want to build a company and a culture for the long haul, we need to be careful about how many mercenaries we have on staff relative to our patriots.

Consider the example of a company a friend of mine owns that operates in the government contracting space. It’s a tough business that relies a lot on relationships and social networks to be successful. That means that having a top-notch business development person is critical to any company’s ability to land new business. These folks have a very specialized, and valuable, skill-set – which means they can be hard to find and retain.

In the case of my friend’s company, he was fortunate to hire one of the best business developers around. And this guy delivered: he landed several large orders for the company (that he was well compensated for, by the way.)
But it also became apparent that digesting the work involved with those contracts was going to take my friend’s company at least a year to work through before they would be able to go out and bid on any new business.

Guess what happened? My friend’s business developer jumped ship rather than risk earning less by waiting for the company to chase new work.
This is a classic case of what happens when you hire a mercenary versus a patriot, someone who would have been willing to shift roles or jobs in the interim as a way to stay with the company and be part of its success over the long haul.
Both patriots and mercenaries can play important roles in your organization’s success. Just know what you’re hiring up front so you can plan best for the long run of your company.

Why You Need to Honestly Assess Your Talent

Many companies rate their talent well above average. Besides being untrue, this is a dangerous strategy as your top performers will leave you if you do.In the mythical town of Lake Wobegon, made famous by Garrison Keillor on National Public Radio, it is said that all the children are above average.While you might laugh at that joke, it’s worth asking: are all the people in your organization rated above average and how do honestly assess the talent in your organization?

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Continue reading Why You Need to Honestly Assess Your Talent

Run Your Business Like You Are Never Selling

To get the best value when sell your business, keep your focus on building a great business, serving your clients, growing your revenue and profits and exit will take care of itself.

Many of the CEOs and leadership teams I have worked with over the years have fallen into the same trap: they get overly focused on selling their company to a strategic or financial acquirer or worse, going public. At one level this is understandable since it is a dream for many, if not most, entrepreneurs and leaders to create a lot of personal wealth through a wildly successful exit from their business. That’s why it’s so common to meet business leaders who seem to think of nothing else.

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But if you make the notion of selling the primary driver of your business, at the expense of continuing to grow a great enterprise, you’re making a critical mistake.

All too often I hear business leaders tell me that they can’t make that new IT investment or ask an under performing executive to leave the business because they are just treading water until the sale of the business closes. No one wants to spend any money, or rock the boat when it comes to key personnel, because they don’t want to jeopardize their big payday.

Strategic buyers and investors are looking to buy companies who have great executive teams in place that not only deliver results in revenue and profits now, but who also have built in the upside to deliver growth into the future. And a pile of recurring revenue is sure to help!

So when a potential acquirer looks at a business that is clearly doing its best just to keep the status quo and not making the right moves and investments, they will see right through that and wonder if the company is now too risky to invest in. Smart buyers and investors look for companies that are continuing to thrive, grow, and make smart decisions – not those who are just passing the buck.

What do you think would happen if an investor approaches your company and asks which members of the executive team they should hang onto – and which ones they shouldn’t? If you immediately give them the name of a vice president who isn’t performing, you can bet the investor’s first question will be: “Why haven’t you gotten rid of them already then?”

Or, let’s say you have been holding off on making that big investment in a new IT system your team has been begging for. What you will find is that when an investor learns about that, they will discount their offer price for your business by the amount it would take them to make that same investment at the very least.

That’s why the best strategy to get the best price for your business is to continue to focus on building a great company – not on trying to sell it. If you were to make the investment in the IT system now, you might even be able to extract a premium from a potential buyer because you have laid the foundation for future growth because of that investment.

Believe me I speak from experience. A few years ago, I, too, was in the process of selling my company. We had received such a rich offer from a public-traded company we couldn’t say no to. At the time, my CFO and I were the only ones who knew the transaction was in the works. As it happened, my VP of engineering wasn’t performing at the time. I had him on an improvement plan for the prior few months and he just wasn’t getting any better. I knew it was time to make the move and help him leave the company. But rather than worry that I would scare off our potential buyer, I let them know what I was doing and why. I told them I was making a decision that was in the best interests of the business – and that was going to be my focus regardless of what happened with our transaction. The buyer was impressed: they told me they appreciated it. The deal eventually went through, before we even replaced that VP.

If you want to get the best price or value when it comes time to sell your business, keep your focus on building a great business, serving your clients, growing your revenue and profits and the great valuation on the exit will take care of itself.

 

The 1 Best Question to Use in an Interview

There is a single question that you can use to assess whether candidates understand the job and if they are A or C players.

The secret to hiring your next great employee might come down to how someone answers a single question. And you won’t be asking what kind of tree the person would be or about her Myers-Briggs profile. It all comes down to measuring performance. Let me explain.talk to us

The authors of the book Who suggest you can immediately begin to distinguish A players from B and C players, beginning with your initial phone screen. You do so by telling a candidate exactly how you will be measuring his or her performance in the job you’re hiring for.

How candidates react will tell you plenty about them. C players, for example, probably won’t be able to hang up the phone fast enough, since they don’t want any part of being measured. A players, on the other hand, will take your bait and get excited for the chance to excel. They might even up the ante by asking you what’s in it for them if they really crush it and exceed your expectations.

It turns out there’s an even better question you can ask candidates to help assess if they are true A players once you have them in for an interview. I learned about this magic question from Joel Trammell, the CEO of software company Khorus, who I wrote about in my book Great CEOs Are Lazy.

Joel believes that CEOs can’t delegate hiring decisions to someone else like HR. He perfected his hiring method by interviewing every single one of the hundreds of employees in his company.

Doing those interviews, Joel found that there was a single question that helped him assess whether a candidate understood the job being applied for and what he or she needed to do to excel in it.

“If I was to hire you, how would I know if you were doing a good job?”

This is a great question because it forces the candidate to put herself into the job and be thoughtful about how she might be measured by you, her boss. The answer you get will tell you a lot about the candidate’s maturity and comfort level with having her performance measured.

If you ask a C player this question, for instance, you might get some stammering followed by some noncritical metrics such as he will show up for work on time and not take extended lunch hours.

A players, on the other hand, will give you exactly what you’re looking for. Let’s say you are hiring a software engineer. When you ask an A player the magic question, he might respond by saying you will know whether he is doing a good job by using three metrics: the total volume of software code he produces on a weekly or monthly basis; the quality of the code based on a limited number of bugs; and his on-time delivery rate in which he hits the targets he said he would.

This would be a great answer because each of the metrics is measurable and quantifiable. You know if you had a group of engineers who were all willing to be measured on those metrics, you’d have a high-performing team.

Similarly, if you were hiring a salesperson, you might want to hear her answer the magic question by saying that you could tell she was doing a good job if she was exceeding her quota and selling profitable business, and her customer satisfaction rating was off the charts.

A key point here is that while you might know what you want to hear from a candidate, leave some wiggle room to be surprised and to learn something new about the position from an A player–someone who might think of a metric you’ve never considered.

The beauty of asking the magic question is also that, after the candidate gives you his answer, you pause for a second and say: “Let me write these down because, if I hire you, this is exactly how I will measure you after you start your new job.”

In other words, you can use the answer to the magic question as a great onboarding tool in which you have eliminated any chance that your new hire will be surprised about what is expected of him after he starts his new job.

How magical is that?