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The People Part of the Excellence Equation
To maintain this difference managers need to do three things: hire right, engage their employees, and retain the best people.
Posted Jun 2, 2003
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The defining mantra of CRM for years has been, "People, Process, and Technology." But since it was mainly CRM vendors and process consultants chanting this mantra, its interpretation and application seemed to effectively be, "People, yep, got 'em. Now, let's get to the stuff that matters." I mean, really, what can you say about people? As it turns out, the answer to this question is, "Lots." "In an age of easily duplicated products, the only sustainable competitive advantage is our people." You may have heard this quote, or something like it, from your own CEO during the past few years. What's interesting is this quote comes from a high-tech executive, but likely not the one you think: Henry Ford. Eighty years ago one of the sharpest business minds was identifying a challenge that like so many others has only become exacerbated. In an age when product life cycles are collapsing, quality is a given, innovative solutions are readily copied, competitors are discounting prices, and customer expectations are escalating, it turns out that the quality of your people is a differentiator that you can sustain--but not without effort. To maintain this difference managers need to do three things: hire right, engage their employees, and retain the best people. Hire Right A great bit of insight I received long ago was this: You hire your problems. The difficult people you have on your team didn't suddenly become obstinate, argumentative, or recalcitrant. Chances are they were that way all along, but your interviewing process wasn't designed to ferret out these unhappy traits. Here's what Rick Cobb, now with Approva Corporation, had to say about interviewing candidates: "For now, I think the days of average performers making big bucks are over. I believe in some principles around the hiring process. The number one thing I look for in a candidate is purposeful behavior. There are very specific ways that you can measure purposeful behavior. Give me a person who has actually demonstrated that she can choose a path and execute on that, rather than someone who has tripped through life and kind of happened to be wherever she was.
"The next thing I look for is accomplishment and a consistent track record of success. It's not enough that people try things. They also need to accomplish those things. These are critical factors to me. Also, I like to see that in the business world, even through the dot-com era, these people didn't have a new job every 12 to 18 months." It's so interesting to me that many companies are not purposeful in the way they recruit, interview, hire, and train their people. Too often, the interviewer feels good about rapport, has a strong gut feeling, or acts on a favorable impulse. Fashioning a winning team means having a clear set of values, a common purpose, and consistent reinforcement of what matters. Gary Lutz, national sales manager at Wells Fargo Commercial Banking, gave a great example of this: "Because the team concept at Wells Fargo is so important in terms of cross-selling and [other business strategies], we now have many more people in the interview process than we had in the past. In addition to the regional sales manager and maybe the senior person in the local office, we now have the candidate meet with some of the relationship managers, customer service people, or product partner specialists. These interviewers don't get to vote, but they definitely get to give us really important feedback. And the feedback is, 'I really liked her. She was really nice; I could work with her.' Or 'What a snob!' "We had a situation very recently where someone came in with a platinum resume. However, all of our team members felt uncomfortable with this individual, so we said, 'Thank you very much,' and didn't pursue him further. Instead, we went out and found somebody with a 14-karat gold resume. Maybe the resume wasn't as stellar, but everyone on the team said, 'Man, we really like him. He's one of us. He's the kind of person we can go have a beer with and play softball with and work with in the office.' We hired him in a minute. Without that input, we'd have made the wrong hiring decision. Engage Employees So you've hired someone solid. Now what? So many companies focus their energy on their new hire training, but do little to continue to mentor, coach, and develop their existing employees. During the heyday of the bubble times, a recruiter that specialized in sales personnel told me he had five offers for every candidate that was looking. Two years later (June 2002), he had 250 candidates for each position he had to fill. Talk about your nasty turnaround. The struggling economy has made people much more reluctant to jump ship. But does the fact that voluntary turnover is down mean people are happy? Or are they simply unwilling to act on their dissatisfaction? In a study reported on January 2002, 75 percent of employees felt a "great sense of frustration" more than half the time. The three main reasons cited for their frustration were: 1) lack of knowledge; 2) lack of ability to affect the company's agenda; 3) no connection between their work and a greater good (i.e., purpose). With respect to the third point it was not necessarily because the company didn't state a laudable purpose, but because there was no person or process to remind folks and make clear what their purpose was on a daily basis. Can technology help in engaging people? And will engaged associates translate into higher performance? There are encouraging examples that the answer to both these questions can be yes./I> My partner, Jim Dickie, talks about tribal wisdom. These are the stories that people carry in their heads and pass on over time. In some cases these stories truly represent wise and insightful action, but often they convey messages that are less relevant than in earlier times. Instead, these stories have become part of "the way we do things around here." There are vendors that now offer tools for capturing and sharing information like updates on competitive knockoffs, "referenceable" customers, or best practices. The content can vary widely, but the format remains consistent and enables employees to find out what they want when they want, without sending blast emails throughout the company. It also allows each individual to contribute to the body of knowledge and be recognized for doing so. Building a knowledge base also protects a company from losing its memory when experienced people do leave. Retain the Best Why do people move on? It certainly can be for more money, but not feeling appreciated is often at the root of people leaving. Another great line, given to me years ago by my friend Harry Gould: We work for the money, but we live for the strokes. Money is what Frederick Hertzberg so long ago called a clinical component of work--or a dissatisfier. Recognition, sense of team, and opportunity for growth all fell on the nonclinical side of the equation--and proved to be satisfiers. In financial planning and insurance, an industry rife with washouts and defections, Savage & Associates in Toledo, OH, has an average tenure of 17 years. Its recruits come straight out of college and the firm mentors these people every day, for three to four years. Everyone is involved in the process, from tenured reps to senior management. The mentoring process is ingrained in the culture and has been for the past 25 years. Bob Savage has this to say about the people they hire: "We look for people with a good work ethic who possess a great attitude. There has to be a certain amount of intellect and talent, but beyond that they must possess great habits. We all have habits, but are they good ones? Honing good habits to improve ourselves, and getting rid of bad habits that we all have at different stages in our lives is what helps us focus and really achieve." Again we should ask, "Can technology help retain folks?" And again the answer is, yes. Like good people, a powerful CRM tool can prove a competitive advantage. General Medical, a division of McKesson, saw turnover in its sales ranks decrease dramatically after the division implemented an interactive selling application that truly helped people sell. Reps didn't want to leave, because other companies they looked at did not have the same tools to help them succeed. In today's tough market there are still companies doing well. Key to their continued success are great people who care about what they do the customers they do it for, and have systems that support their efforts, rather than act as hurdles. Process and technology are two parts of the CRM mantra, but it begins with people. As much as things have changed over the past 80 years, Henry still had it right: In the end, your people make the sustainable difference. About the Author Barry Trailer is a Partner for CSO Insights and coauthor with Jim Dickie of The Sales & Marketing Excellence Challenge: Changing How the Game Is Played available through Amazon.com. Contact him at www.CSOinsights.com.
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