A great deal has been written and said about the difficulties companies face in finding, attracting and acquiring top talent. And yet even when companies are able to accomplish that they still often find themselves overpaying for this talent in terms of both the compensation package extended and the time and effort expended to find and close the desired candidate.
And if that isn't reason enough to rethink the entire talent acquisition process we must be honest and acknowledge that the entire process also often takes far, far too long which introduces a number of possibly very expensive opportunity costs along the way.
So why does this happen?
Well, for starters, while we've all heard so much about the so-called War For Talent and how important top talent (supposedly) is to the bottom line success of a firm or organization, the reality is that many, if not most companies, and their employees (often unbeknownst to themselves) are actively engaged not on a War For Talent but instead are engaged in a defacto War On Talent.
That bears repeating: A War On Talent. Not a War For Talent.
A minor change in preposition yields a huge difference in meaning.
They are actively, and quite successfully I might add, chasing away the very top talent that they so desperately need and desire (or are at least stating that they need and desire). In some cases they are chasing away the top talent from even applying -- "Why would I apply there? It's a resume blackhole"....."Why would I apply there? Who wants to go through a maze of interviews only to get knocked out by one interviewer who doesn't like you or is afraid of your talent?".
In other cases, they are chasing away the talent from continuing on in the process after the first interview -- the company or hiring authority wants to move the candidate forward in the process but the candidate opts out and pulls the rip cord.
In still other cases, we find that they're extremely effective in filtering out the top talent during the initial resume screening process -- that's right, extremely effective in cutting out, in booting to the curb, the top talent during the resume review or screening process.
And as if that isn't enough, in other cases, they're simply drop kicking the best candidates to the curb after the first or second interview.
How fast this occurs most often depends on how soon it becomes evident to the hiring company, manager or future peers that the talent at hand is hot (the more talent a candidate has, the more often and faster this can happen -- yes it's counter intuitive but it's a reality).
"James, James, what are you blabbering on about? What do you mean companies are blocking and booting top talent to the curb? Why would they do that? And for the top talent they hire how can you possibly say that they are overpaying?"
You asked, so let's take a quick look at these.
First, it's no secret that companies often spend large sums of money trying to recruit and acquire what they consider to be the top talent on the market and in the market. It would behoove us to remember that the total cost to successfully hire one candidate accrues not only from the direct expenses paid to advertise the open position but that it also comes from the often steep fees (steep from the perspective of the hiring company -- I've never heard a hiring firm say that a recruiting agency's / third-party agency's fees were "too low".) which third-party (agency) recruiters charge. These fees may be as low as 15% to 20% of the new hire's first year salary in many places such as in the US but the fees may also range to as much as 30% to 35% in places such as Japan (in some cases, accelerating up to 50% -- yes, 50% -- this is not a typo).
But even fees of 15% to 20% can be painful - this is especially the case when annual salaries are running at $100,000. $120,000 or $150,000 or even much more. One must also determine the volume of positions to be filled -- not just for new positions but for existing positions (dictated by the churn rate or conversely the retention rate). It doesn't take a financial genius to realize that these expenses can and do add up rather quickly. We also must consider how much time and energy is spent bringing in each of these candidates for an interview.
And by the way, if you aren't paying fees to a third party agency then you are most likely relying on your in-house recruiters so again you must fully burden their compensation packages and costs -- salary, bonuses, health care, expenses, HR management / compliance fees, payroll taxes and processing and facilities - desk, telephone, computer, etc.). We also need to consider the time and energy spent by the HR department as well as the hiring manager. We must also include the costs associated with the participation of the interviewee's future peers who often asked to assist or are required to participate in the (again, often very lengthy) interview process.
We should have no illusions that the very act of Interviewing external candidates can quickly chew up a huge amount of an employee's valuable time and also reduce their productivity due to the increased stress they experience from the distractions that participating in so many candidate interviews brings to each of the interviewer's already hectic and fully-packed work schedule.
This is not to say that interviewing is not an important part of a hiring manager's or even a team member's job. The fact is, participating in these interviews is not just important but critical. For the company. For the department. For the team members.
But it does mean that we must take into account all the costs (and who pays them) associated not just with the recruiting or talent acquisition process but more specifically with the talent acquisition process we have chosen or that we have been "gifted".
Beyond this, it also means that the candidates who are brought in for an interview should be (properly and effectively) screened to ensure that each is of sufficient constitution to be "employable" at the firm. Further, all participating interviewers must know how to define talent and test for fit both within the broader company and within their particular department as well as the particular team they would join if successful. Going even beyond this, we find that the all interviewers must know how to effect the aforementioned items.
For instance, all interviews must know what techniques to use to extract the required information as well as guide the interview and they must be able to use them competently if not fluently. They must also know what questions to ask and how to ask them, and most importantly, how to interpret the interviewee's responses to these questions.
Interviewers seldom think about this and even if they do their definition of talent is most often found to be both suspect and even deficient as is their ability to effectively and efficiently interview and assess the candidate at hand on an absolute basis as well as relative to the available talent on the market (and at their price range).
In practice, this leads to a hiring process which favors either the selection of a patently "wrong" candidate or the selection of a subpar candidate. It also often leads to the hiring of Safe Candidates or in the case of the hiring which is done by marquee companies (think Microsoft, Oracle, Facebook, SFDC, etc.), it means hiring or leads to hiring only properly pedigreed candidate.
And here's a news flash.
Almost anytime you hire the properly pedigreed candidate you:
(1) Overpay for the talent.
(2) You end up with higher candidate expectations which often lead to less loyalty, faster job changes and/or an attitude problem.
(3) You end up with an employee who is likely to be recruited away / more receptive to sweet whispers or more likely to look outside.
But are companies, especially companies in say, Silicon Valley, actually worried about compensation packages being too expensive, too high? Are they really worried about overpaying? Can't they just slough that off and "expense it"?
Well, in regards to the overpayment or overcompensation of talent, we only need be aware of the proven collusion to hold down wages in Silicon Valley through the enforcement of illegal anti-poaching agreements among some the top firms (e.g., Apple, Google, etc. although to Facebook's credit, they apparently declined to participate).
If hiring companies weren't concerned about fast rising wages and the total costs of finding new key talent or replacing it, why would they take such great risks through the involvement in such collusion? What's the upside of the collusion if everything is kosher as is?
This further begs the question: Why, why would they do this? And why would wages be rising so much and so fast?
Yet again, Economics 101 to the rescue. We need only look at, as a starting point, supply and demand. The hiring firms most likely felt that the supply of the top talent they desired or required was in short supply compared to their own hiring demands/needs as well as the aggregate market demand.
To be clear, this is top talent which is defined as top talent per their often narrow and erroneous definition(s).
Now it is also highly possible that the true top talent is and was in short supply although this doesn't justify illegal arrangements.
However, it is even more probable, based on what I've seen in my own HR Consulting and Executive Coaching over the years, that this was brought on by the firm's HR department's or the firm's hiring managers' own broken definition of what talent is (let alone what top talent is) as well as the inability of the hiring firm and/or the hiring firm's interviewers to properly attract, assess and close down said talent.
What is needed is to develop a cohesive framework starting with the definition of what the desired or required talent looks like as well as the techniques, processes and questions needed to identify, assess, attract and close it. This rarely happens. Instead we often find that firms' hiring efforts are impeded by a multitude of cognitive biases such as the educational pedigree or the status and ranking of the candidate's current or former employer and so on (halo effect, horns effect, social proof, the safe candidate, just world hypothesis, etc.).
Yet as we've discussed time and time again, the firm's operating or assumed definition of desired or required talent is almost always wrong and these mental short cuts further invoke a series of destructive cognitive biases which rapidly compound and become a vicious circle.
For instance, when you see a "talented" Google sales person can you really accurately determine how much of that person's success at sales at Google is or was due to their own talent?
How much of their success was due to the team behind them?
How much of their success was due to the resources they had access to?
How much of the candidate's success was due to Google's market power which is almost a monopoly power?
How much of the candidate's success was due to the Google brand?
In terms of the salaries paid, higher salary doesn't automatically buy better talent nor more loyal talent.
Yet the myth and meme that it does still persists.
We've already seen numerous cases of extremely loyal talent, often top talent which is motivated far less by market-rate or above-market rate salaries and motivated far more by other factors.
Examples of occupations or roles where the compensation may be well below the market rate include military pilots and other military or intelligence community specialists as well as the clergy and various medical volunteers working in dangerous places around the world.
Turning to other more extreme or unsavory cases of motivation by non-monetary means, we immediately note members of cults and suicide bombers. These are often extremely motivated and loyal individuals who, in the case of cults, are often willing to not just work for FREE but to first donate to the organization their entire life savings.
In the case of suicide bombers, well, they are willing to blow themselves up. Talk about dedication and passion, however twisted, debased or unsavory one may find it.
So don't try to tell me money is the greatest motivator. It isn't.
Now since you most certainly aren't going ask the successful candidate to commit to such a radical program as giving you all their assets and working for free or blowing themselves up when they join your company but will most likely pay going to pay them at least a "decent" if not competitive salary, we need to ask again:
"How hard can it really be to close the candidate down and get them to join your company?"
If you can't answer that satisfactorily then it's time to look at adjusting or reconsidering your recruiting / talent acquisition process.
And for those not interested in re-inventing the wheel or who would like to access an immediately actionable system that provides an extremely powerful framework and system to identify, attract, assess and close top talent all while not overpaying or chasing the desired talent away we'd suggested our Supercharged Candidate Interviewing training and consulting program as well as our High-Performance Talent Acquisition training and consult program.
Something to think about.
By James Santagata
Principal Consultant, SiliconEdge
I came across this interesting Silicon Valley Business Journal article entitled "Why do startups fail? Here are the top 20 reasons" which summarizes a large post-mortem analysis of startup failures conducted by CB Insights
One quick takeaway to highlight:
"After reading through every single of the 101 post-mortems, we’ve learned two things. One — there is rarely one reason for a single startup's failure. And two — across all these failures, the reasons are very diverse."
Here's the top twenty reasons:
(Note: percentages don't add up to 100 because sometimes there are multiple reasons for failure)
1. Building a solution in search of a problem: Falling in love with an idea or building it out with market validation. 42 percent cited this.
2. Cash Out. No Mas: We'll assume this wasn't due to financial mismanagement or malfeasance but a natural outcome of a sane burn rate over an extended period with trailing revenues of a lean nature. 29 percent reported this.
3. Wrong team: Lacking key members or skill sets This was cited by 23 percent of the companies.
4. Beaten by the competition: About 19 percent of the companies reported this.
5. Pricing/cost issues: Reported by 18 percent in the study.
6. Poor product: This was reported by 17 percent of the companies.
7. Need/lack business model: A lack of a viable model killed 17 percent of these companies.
8. Poor marketing: Knowing how to code or build good products isn't enough. Reported by 14 percent of the companies.
9. Ignoring customers: 14 percent of the companies in the studied pointed to this.
10. Mis-timed product (releases): 13 percent of the companies in the survey reported this. A Calxeda employee told CB Insights, “We moved faster than our customers could move. We moved with tech that wasn't really ready for them... We were too early.”
11. Lost focus: 13 percent reported this.
12. Founder/investor strife: Creative tension is far different than toxic infighting. 13 percent of the companies succumbed to this.
13. Pivot gone bad: As has been said, "The pivot used to be called the f****up". 10 percent pointed to this.
14: Lack passion: The passion to stick it out, to execute. 9 percent identified this as the reason.
15: Bad location: For hiring/retaining talent, customers, investors and so on. This was cited by 9 percent.
16. No financing/investor interest: This was pointed to by 8 percent.
17. Legal challenges: Cited by 8 percent of the companies.
18. Don't use network/advisers: Again cited by 8 percent of the companies.
19. Burnout: Never a good thing, many reasons why a team can burn out. 8 percent pointed to this as the culprit.
20: Failure to pivot: As has been said earlier, "The pivot used to be called the F****up" and while that may be true it doesn't change the fact that continuing down the same messed up path is going to get your any place faster (other than bankruptcy court) and certainly no where better. 7 percent cited this.
James will speaking on the very important career-related topic of "I'm 40 Now! Is It Really Game Over For Me In Japan's Job Market?" at the Foreign Correspondents' Club of Japan on November 20th.
Among job seekers, arguably no group is more negatively affected by this brutal reality than 40+ year old job seekers.
Many 40+ year old job seekers are shocked to find this is the reality not only in the broader US economy but even in vaunted Silicon Valley which is the supposed Mecca of open-mindedness and where a meritocracy has ruled for decades.
And yet, for how bad it is in the US and even Silicon Valley, 40+ year old job seekers soon come to find that it's often much, much worse in Japan. Terrible. Impossibly frustrating. Depressing. These are words that come to mind when seeking employment in Japan as a 40+ year old candidate.
But how can this be the case in Japan, when Japan still has an economy which is the 3rd largest economy in the world and which is moving to further internationalize its businesses as rapidly as possible in the face of both falling domestic demand and a severe shortage of experienced workers.
The bottom line is this: Older, deeply experienced job seekers quickly run into 5 seemingly insurmountable brick walls..
By James Santagata
Principal Consultant, SiliconEdge
Many companies mistakenly think that they're fighting a "War For Talent" when their policies and procedures inadvertently have them waging a "War On Talent".
The "War On Talent" takes the form of overpaying for weak or misaligned talent while rejecting and filtering out solid performers and top talent. It 's often the result when firm is mired in destructive processes and practices such as Cargo Cult Recruiting™, Cargo Cult Interviewing™ & Cargo Cult Hiring™.
Companies that are concerned about this should investigate auditing, deconstructing or tearing down and replacing their current practices and processes as needed.
SiliconEdge's Supercharged Interviewing™ and TrueHire™ Methodology was developed for just this purpose. Use these programmes to confidently hire better candidates faster and cheaper while setting the stage for strong future employee engagement from the very first interview.
By James Santagata
Principal Consultant, SiliconEdge
Have you ever wondered why companies so often overpay for talent that just doesn't perform or worse negatively impacts the company's performance?
By the same token, have you ever wondered why companies seem to so often inadvertently or even consciously block, reject and trample Top Talent?
The fact is, the so-called War For Talent most often resembles a War On Talent.
Innovation Denied With Billions Lost: What Brian Acton & WhatsApp Teach Us About Innovation, Leadership & Hiring Practices
By James Santagata
Principal Consultant, SiliconEdge
Well, if you haven't heard the news yet the Valley M&A buying spree continues unabated, this time with Facebook snapping up mobile messaging company WhatsApp for a hefty $16 to $19 Billion USD (depending on which news source you reference).
There are many lessons and takeaways from this acquisition but allow me to focus on just a few.
1. Ignore The Cheerleader Tech Press:
WhosWhat? WhatsWho? WhatsApp! Personally, I wasn't aware of WhatsApp before this acquisition as I don't use the app and I'm mostly a user of Viber and Skype so I can be forgiven. However, within the Silicon Valley Cheerleader Press, especially Tech "Apple-Twitter-Quora" Crunch and even Pando Monthly and VentureBeat, I'm sorry but even as frequent if not habitual reader, I just didn't see the coverage. How could this be, how could they miss it, a huge multibillion dollar company?
The answer is simple: Why would you expect the Cheerleader Tech Press to get it?
2. Companies Can't Pick Top Talent:
It turns out that before co-founding WhatsApp, Brian Acton formerly worked at Yahoo in a quite senior / important position. After over a decade at Yahoo, he left to take some time off and then applied for a new position landing interviews with at least a few major valley tech companies such as Facebook and Twitter. However, he was rejected at both. Perhaps these rejections were due to Action being incompetent. Or perhaps Action interviewed poorly and no communication skills? Or is it perhaps more likely that these companies or at least the hiring authorities at these companies either (a) don't know how to select top-shelf talent and/or (b) allow office politics and threats to an incumbent employee's ego or career path to dictate who gets hired and who doesn't? Examples are where a senior person with top skills scares a younger or less experienced manager from making the hire -- doubt that? It happens all the time. All the time. And it costs companies millions if not billions per year.
Oh and it makes you wonder, if Facebook had hired Acton, would they have gotten him to build WhatsApp for a lot less than the $19 Billion USD they paid for it? Or would WhatsApp never be built and fall into the "Innovation Lost" point below?
3. Leaderless Rather Than Leadership and Innovation Lost:
Perhaps the biggest lesson is why Yahoo, which had him onboard for over 10 years didn't extract this value, this innovation It's possible that Yahoo was simply so completely leaderless and rudderless that they didn't even know what to have him do. Or perhaps he tried to be innovative and got his hands slapped. Whatever the reason, it's clear that Acton had some innovative ideas inside of him and more importantly he had the confidence and motivate to start and execute. But it's clearly not just a shame but a multi-billion dollar tragedy that Yahoo had him on the payroll all those years, had him suited up and yet would let him get in the game and swing for the fences.
If you can create a company with the proper culture that has strong leadership, embraces innovation, empowers employees and hires top talent or solid talent, especially talent that either scares other firms (because it's too good) or is good inside but is a bit dinged on the outside, you're firm will do very, very well.
By James Santagata
Principal Consultant, SiliconEdge
It seems like the peddling of the old standby Myths & Memes is on the rise once again in the Valley. As this is often a lagging indicator of both the Valley's, and even the wider Tech Industry's financial state, it tells me that we're in a very frothy if not overheated market since people are now letting their hair down and apparently gleefully throwing themselves onto the politically correct bandwagon. But they should be careful, lest they find themselves thrown beneath it.
Still, it's my guess that whatever problems or disasters may rear their ugly heads in the future due to blind belief and adherence to these Myths & Memes, the folks most involved are betting that they'll be able to quickly paper over it with the waves and waves of cash that are flowing so freely now.
But not everyone believed let alone followed these Myths and Memes and amazingly, they didn't fail or turn into a pumpkin or a toad.
What a perfect example of a person who broke every one of these Myths and Memes?
Try Steve Jobs. Yep, Steve Jobs. And Apple Computer under his guidance during his second tour of duty.
The fact is, no one can deny that, under Steve Jobs, Apple was a smashing success. All the metrics are there: market cap, profits, amazing hit product after hit product. iMac, iPod, iTunes, iPhone. You name it.
And for the record, I am by no means an Apple fan nor am I a Steve Jobs / Apple Computer apologist. I'm simply a reality-based thinker and I call it the way it is, not the way I wish it were.
That said, I'm a very serious student of Steve Jobs and I'm not afraid to look at what really made him successful. I can tell you, it wasn't following the Valley Myth and Memes and it wasn't being politically correct.
In fact, Steve Jobs did the exact opposite of what most pundits and social engineers are preaching. And the reason it worked for Steve Jobs is because Steve Jobs and his communication style was perfectly aligned with the way the world and humans work.
What is most interesting, though perhaps very disconcerting to the social engineers among us, is how Steve Jobs did it.
We're told that if a person studies hard at the "right" schools, gets a "good" education and makes the "right" connections they'll be well positioned for success.
Beyond that we are told, especially in the Valley, that an organization will perform best when it is openly transparent (both internally and externally), when there is diversity, when there are women in senior leadership positions and when we have an open environment of respect and perhaps kumbayahism in the office.
Going even further, we are told that we should be investing and building all kinds of new tech that people have never seen. And by "new tech" I mean core tech, not making sexy cases, new form factors or tinkering with some incremental derivative product like the iPod.
And yet, if we look at Steve Jobs and his management style during his absolutely, amazing and record smashing second run we find something that is completely at odds with what the pundits say is necessary for success:
1. No diversity at Apple (as defined by the politically correct sense of skin pigmentation / reproductive organs).
2. No women in senior leadership positions (see also: Apple Vows To Find Women & Minorities For Board Directors).
3. No Indians in senior leadership positions (see: Why Indian presence in Apple's senior management level is next to nil).
4. Few minorities (see: Apple Facing Criticism About Diversity Changes Bylaws).
5. Steve Jobs didn't go to a "top" university.
6. Steve Jobs didn't even graduate from a four-year college.
7. Steve Jobs was not transparent. At best, he could be characterized as a benevolent dictator, at worst a tyrant.
8. Jobs/Apple was not open -- you leak new Apple products, you'd be hunted down & sued (see: Apple Sues To Stop Product Leaks).
9 Jobs/Apple could be downright nasty, even engaging in potentially illegal activity, if the "no poach" collusion allegations are borne out.
10. Steve Jobs even used his money to find a loophole in California vehicle code so that he wouldn't have to get license plates and had an apparent penchant for parking in the handicap spaces.
And yet again, while Steve Jobs just turned a blind eye to all of these supposed business and organizational "requirements" his results were phenomenal. Can we in any way argue with Steve Jobs' success? It seems that few prominent members of the Valley tech community question his success so I guess not.
Next time, we'll dig a bit deeper and explore why Steve Jobs was so successful, time and time again. The results may surprise you.
Lastly, as quick exercise, we should ask ourselves is Apple really lacking diversity? Or is and has Apple always been diverse but in a more mature manner, such as defining "diversity" with regard to value, thought patterns and productivity rather than with regard to skin pigments and reproductive organs?.
It can easily be argued that a man and women studying the same subject matter from Princeton (not to pick on any school) will be more alike than two men, one of which studied electrical engineering and the other who studied marketing at two different schools in two different states or countries.
Think about it.
By James Santagata
Principal Consultant, Silicon Edge
In a recent blog post entitled "How to Deal with Pure Recruiting Mistakes", Mark Suster, a partner at Upfront Ventures gives his take on fixing recruiting or hiring mistakes. He has written some other posts on the subject as well in terms of hiring and firing fast.
In regards to hiring and firing fast, I want to be clear and fair that his post is primarily referring to startups (whose needs may be well different than a large, more established company) and is not a "just pull anyone in and see who makes it" mentality.
There is a lot of merit in moving quickly in the hiring process, in fact, many companies lose key talent because they move to slow. This slowness in hiring often comes from several factors which may include an overly subjective interview process, the inability to get all people to agree to a hire (e.g,. a group decision) or "cock-blocking" office politics.
What I want to do today, is to delve a little deeper into why recruiting mistakes happen. Why are people hired who don't work out? Is it skills, attitude, cultural fit or some other factor or combination?
There are many factors and they come from both sides of the table -- the candidate's side and the hiring firm's side. Each situation is different (ESID), but we can usually boil it down to several factors:
1. The candidate doesn't have the aptitude (skills).
2. The candidate doesn't have the attitude (mind set and motivation).
3. The candidate doesn't mesh / can't find his or her way in the corporate culture. That is, it moves too fast or too slow for the candidate.
4, The company improperly assessed the candidates skills sets and fit.
5. The company selected the candidate to fail (e.g,. "Rank & Yank" and this candidate is the group's Sacrificial Lamb).
6. The company applied a selection shortcut -- "Oh he worked at XYZ company, must be good..."
7. The candidate's new peers or one peer sees the new hire as threat and works to remove (have fired) him or her.
Of these factors, #6 is perhaps the most critical error (along with #4) when we make hiring decisions quickly. What happens is that unless we know exactly how to interview AND are interested in a very objective, brass-tacks assessment of how the candidate really is rather than how we'd wish would be or hope the candidate is, we will get fooled and made bad decisions.
Most often this happens when we rely on Social Proof, assume the Portability of Talent (namely, the inability to identify and separate the success of the candidate from the success or support provided by the system, company or brand) and engage in Trait Ascription Bias while applying the Just World Hypothesis (sometimes known as Just World Theory, Fallacy or Phenomenon. It's a cognitive bias).
Two of the more insidious reasons the wrong hires occur is when the hiring authority's (or future peer group's) ego as well as internal politics are injected into the hiring and assessment process. This is a killer. Often resulting in hiring the wrong talent, while driving away and 86'ing the key talent.
Here's a quickly illustration of several of these factors at play simultaneously. And just for the record, please don't read anything into the universities or companies that I have chosen to illustrate this with. They were simply chosen because of their impact in terms of having or lacking social proof and so on.
Hiring Manager / Hiring Authority:
"Hey, this candidate is a stud/studette. He/she was the Sales Director at Google so he'd/she'd make the perfect first hire for our startup sales team."
When you're selling for Google or IBM among other well-known firms, you'll find that about 90% of the sales mojo comes from your brand, team and resources. Conversely, when you're selling from Puntster Analytics from Podunk. Iowa, it's all about your game and skills -- pure talent.
Similar mishires are also clearly seen when hiring shortcuts are taken by hiring from direct competitors (or hiring industry insiders) and misattributing their past successes to the candidate rather than seeing what the system provided. Conversely, an excellent person may be turned away and they often are, because their stats aren't as good BUT their stats are the result of Jedi-level talent in the face of a poor brand or system. Yet they are rejected.
There are countless other examples, but another common one is the filtering out or rejecting of highly-qualified talent because the current interviewers or team see the candidate as a clear and present danger and threat to someone's salary, position, title and/or ego on the team.
How to Deal with Pure Recruiting Mistakes
Posted on November 27, 2013
by Mark Suster
One of the unavoidable realities of building a startup is having to fire people.
In a normal business you can often sweep bad performers under the rug and not deal with them. When you have millions or billions of dollars of revenue you can suffer a few bad performers or bad apples. You can miss a quarter’s target and not cull the inefficiencies. I’m not saying you should, but you could.
But in startups this equals death.
Death because just 3 extra non-performing employees in a company of 15 can either accelerate cash out date or can dramatically lower your productivity.
I’ve spoken about this before and my mantra, “Hire Fast, Fire Fast.”
When I first started my career I came across a term for this that has always stuck in my head and serves as a useful reminder of this mantra.
We called it “PURE.”
Previously. Undetected. Recruiting. Error.
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