Posts Tagged ‘“a” players’

Are You At Risk of the 18 Month Factor?

Saturday, June 3rd, 2017

Many executives tolerate B and C performance from their key reports for far too long. I have had the privilege of sharing a speaker’s platform several times with investor, serial entrepreneur, author, speaker, consultant and all around good guy Dave Berkus. Dave coined the phrase “The 18-Month Factor” to describe how long it takes from the time you acknowledge having an underperforming manager to the time you have a fully effective person producing critical results. Dave’s theory, with which I agree completely, is as follows: You (the CEO or Senior Executive) first realizes the problem by noticing that “Joe” is not getting it done. You say, “Well, I’ll give him a bit more time.” Interestingly, this patience only seems to apply to people, not other key business decisions, right?

3 months go by, then you say, “Well, I’ll talk to him about it.” Joe agrees to change, so you give him 3 more months, and still nothing has changed, so you give him a warning. Shape up or else. At that point, 50% of the B and C players become “mentally unemployed”. Some of them actually start looking, but some just eat up your payroll while their performance actually gets worse. And, it is expensive in indirect ways too – lost opportunities, etc.

So, at about the 9 month point, you decide you really must do something about Joe. You launch a search. The search takes the usual 3 months, and you find a new person who looks like an “A” player. By the time that individual is on board, and the get-acquainted honeymoon is over, you’re in the 13th or 14th month, and it will surely take 3-4 months before you can expect meaningful change and better results. Presto, 18 months have gone by.

Strategic replacement takes brave, decisive action. My grandfather used to say, “The first loss is the best loss,” because business loss is really valuable information, and if you pay attention quickly, you can cut the next loss. 2010 is a very meaningful year for executive change. As companies jockey for position to see who is going to rise first in the recovery, there will be a scramble for market share. For many companies, that will require stronger people. Don’t find yourself stuck with B and C people in an 18-month cycle.

If you are a business leader, and you’ve survived the past two years, you probably have keen judgment. Make sure it applies to more than financials, inventory, operations, etc. Apply it to your #1 asset as well – your people.

The How-to’s of Employee Retention

Saturday, June 3rd, 2017

My last post was about the importance of keeping your best people, especially in a recession. Today I’ll focus on what motivates an “A” player. These factors need to be in place in order for you to keep your top people loyal. “A” players are motivated to stay with you when they are:

  • Inspired by your vision and leadership – make sure you articulate this clearly and stay positive in your communication.
  • Impressed by your business plan – You do have one, right? A roadmap to success must be part of your plan.
  • Part of a great team tackling a great challenge – an “A” player wants to be surrounded by other high quality teammates, who are operating at optimum performance.
  • Believing in the company’s potential to succeed – would you bet on your chances? Your “A” players can calculate the odds too.
  • In a stable, secure environment – have you been making people feel safe or not so safe in your comments about today’s situation?
  • Able to make a difference, to count – because you have clearly spelled out their objectives and shown them how the achievement of those aligns with corporate goals.
  • Have the right compensation – this is last on the list, because if the factors above are present, compensation becomes less important. The “right” compensation for a key manager includes incentives for their own performance objectives.

Take care of your people, mostly through excellent communication and the right attitude, and I believe they will stay loyal and take care of you!

Why “A” Players are Essential for your Success as a CEO

Saturday, June 3rd, 2017

Do You Have “A” Players in Key Positions?

Achievement of aggressive company objectives depends on the solid performance of key leaders who are uniquely capable of producing essential results.

Recent studies have shown that employers are developing new executive profiles as they select people to lead their company into the millennium, especially in early stage and rapid growth organizations.

These critical factors will differentiate fair-to-mediocre prospects from “A” Players – top performers who always contribute to bottom line:

• Initiative: Can the individual go above and beyond standard job expectations? As organizations do more with less, they depend on managers to add value, and seek opportunities for improvement. The more an individual can do on his/her own, the greater the value to the employer.

• Drive: The desire to excel. Top performers do a good job on their own because they want to, not because someone is watching or forcing their behavior. In today’s self-directed workplace, this skill is crucial.

• Leadership: People who can empower, inspire, coach and teach are in demand. Employers seek leaders who motivate people to improve job performance, challenge people to solve their own problems, and communicate clearly about company and individual goals.

• Flexibility: Professionals must be able to switch gears, in order to adapt to rapid change within the company, while performing a wider array of tasks.

• Problem-Solving: Quickly, creatively and decisively driving toward solutions on critical issues equates to making and/or saving money.

• Teamwork: Interpersonal skills have a great impact on job success. The ability to support and work with others is critical. A true team player facilitates even better performance from his/her peers.

• Job-Fit: Providing challenging assignments appropriate to an individuals skills and abilities helps ensure success. Assess the candidate’s past performance to predict future performance, and determine if character and personality fit the company culture and needs of the job. Don’t put square pegs in round holes. Don’t believe everything you hear. Verify!

• Motivation: Why does this person want this particular job? Make sure individual beliefs, needs and wants are aligned with what the position has to offer. Highly motivated people will outperform bored or unhappy people every time.

BOYLE OGATA BREGMAN’S Performance-Based Search System finds “A” players every time! Call for information. Contact Mark at 949-440-6855 / mark@bobsearch.com

2017 Growth Is All About Market Share

Thursday, June 1st, 2017

Some of my clients and colleagues are naturally reporting that the fear in the economy is getting them down. Smart companies know that in a flat or declining market, the only way to grow is to steal business from the competition. Many of my clients are practically salivating at the prospect of leaping into a volatile market and expanding their business by increasing market share. The first step to taking advantage of this market is making sure you have a strong executive team that can not only weather this storm but capitalize on it. By evaluating the strengths and weaknesses of your key players you may find that some new blood is needed.

Einstein said that insanity is doing the same thing over and over again and expecting different results. I think it is obvious that sometimes you need better people to get better results.

Most of the people looking for jobs right now are people who were just laid off by declining companies. These are not necessarily the “A” players you want to add to your team. It is usually better to find the happy, productive people who are still working hard for their current employers. These people are more likely to produce the critical results you need, based on their strong track record.

As you plan to increase your market share next year, ask yourself this question: Do I need access to the “A” players; those who aren’t looking for a job, that could help me grow my business? If the answer is yes, take the following steps:
1. Take a look at your current team, and determine who is achieving your objectives, who is not, and why not.
2. Be objective about the capabilities of your people. Get outside advice if needed to assess the team.
3. Move quickly to position yourself with a solid team that can increase market share – before your competitors act on the same idea.

How Much Is a Bad Hire Costing You?

Tuesday, May 24th, 2016

snoozing exec

If you are at the C-level (or even the VP level), you are responsible for hiring, retaining, and managing an executive team, and it is important for you to know how much bad hiring can cost you.  Let’s assume that you will be an executive for 20 years, at 5 different companies (avg. 4 years each), with 6 direct reports.  That is 30 hiring / retention opportunities.  By the way, retaining a B or C player instead of making sure you have all A-players, is just as costly as bad hiring of new people.  Let’s further assume you are really good, and get it right 80% of the time (average exec actually hits about 57%).  So, with 30 reports, and a 20% error factor, you are likely to have 6 bad team members over your 20 years as a managing executive.

What will the financial impact be of those bad hires?  If you are at a $50 Million company, aiming for 10% growth, let’s say that a bad exec team member merely lowers your success rate, so you only hit 8% growth instead of 10% growth.  You aren’t getting fired for that, and probably no one else on your team is getting fired either.  But at $50 mil revenue, a 2% loss in growth is $1 million!  Granted, revenue is not EBITDA, but over 20 years, that may cost your owners $20 million in lost revenue.  That could be equal to $20 million in equity, since 5x EBITDA is often about 1x revenue.

Is this important?  After all, you would have gotten $4 mil /year in growth (vs. $5 mil), so you might have achieved $80 million in revenue / potential equity increases (vs $100 mil if you were perfect at hiring) after 20 years.  OK, fair enough.  But what if you are in fact wrong 40% of the time (closer to the average), and you tolerate 12 so-so people out of 30?  Then, the problem compounds.  Instead of missing 40% of the expected revenue increase, you might not get an increase at all if 40% of your team is missing in action, marginally effective, etc.

This example of lost growth revenue is of course just the tip of the iceberg.  In addition to lost revenue, a mediocre team could be failing you on on-time delivery, escapes, customer satisfaction, employee relations (leading to poor utilization and turnover), and a myriad of other operational problems that all cost big money.  How do we know?  These are the performance objectives we get from our clients when we develop position profiles for new executive hires!  When employers replace the poor performers, these are the costly problems they seek to fix.  You must also include time lost by you and the good performers on your team, who often waste productivity trying to get the poor performers up to speed.

In addition to the costs associated with the impact of a poor performer, there are also the actual hard costs of a bad hire:  recruiting fees, candidate travel, relocation, sign-on bonuses, severance, actual salaries paid, and the unpredictable cost of a potential lawsuit.

If you are a regular reader, you have seen our many articles on hiring the right way, to avoid these potentially costly mistakes!  Feel free to request reprints and visit our website to see our comprehensive program for smart hiring.