Survey shows Company Culture Vital in Employee Recruitment

A new study released this week by NFI Research demonstrates that recruiting new employees is more difficult than retaining valued employees for the majority of organizations. While I think people can relate to this personally, it's always good to have quantifiable data!

Eighty-one percent of senior executives and managers said that recruiting new employees is more difficult than retaining valued employees, according to the nationwide survey of 223 senior executives and managers conducted by NFI Research.

When recruiting or retaining employees, the less tangible things appear to go a long way.
The three most effective incentives for recruitment were company culture (59 percent), organization's reputation (57 percent) and stability of the company (54 percent).

"While compensation matters, there are other softer things that keep employees at their jobs," said Chuck Martin, NFI Research CEO. "This shows that company reputation does matter."
For retention of valued employees, the top three incentives were company culture (57 percent), stability of company (50 percent) and flexibility (44 percent).

There was no significant difference by company size.

"The biggest challenge is ensuring that we as leaders live and breath the culture of the organization that we want to create," said one survey respondent. "If you are really doing this ... it shows to new recruits and those you want to retain."

NFI Research surveys 2,000 senior executives and managers globally every two weeks. It has chronicled the transformation of business and countless workplace issues for seven years.

Source: Workforce Performance Solutions Magazine, May 19, 2006.

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The Value of Becoming a Learning Organization

Many companies face the question of the value of investing in organizational learning.

Consider this: A four-year study by the American Society for Training and Development (ASTD) shows that firms that invest $1,500 per employee in training compared to those that spend $125 experience on average 24 percent higher gross profit margins and 218 percent higher income per employee.

While those impressive statistics may occur over a long period, it’s also possible to evaluate how learning contributes to the performance of your company in a more immediate manner. Some measures are directly quantifiable, but intangibles can also provide indicators of organizational learning. It’s important to recognize and track a variety of measures, from the global down to the specific, the tangible to the intangible.

• Meeting Business Goals and Objectives. A recent client wanted greater penetration into key markets, but the sales force lacked the skills. They invested in a new sales analysis system together with direct training in data analysis, presentation and negotiation skills. Their clear measure of success was in hitting financial and business goals.
• Measuring Effectiveness of Employees. Metrics include skill testing, competency certification and surveys. The client described above revises and repeats its sales force skills survey annually to determine whether employees have remained up to speed and up to date.
• Valuing Speed of Decision Making. Perhaps the best indicator of the continuous progress of organizational learning is continuous reduction in the time it takes to make business decisions.
• Sharing Best Practices. The most successful companies track the sharing and implementation of internal and external best practices. This lends itself to both process and business improvement measures when a practice is adopted.
• Retaining Future Leaders. Your most talented employees and future leaders want to gain new skills, meet new challenges and earn recognition and rewards. Another clear indicator of [lack of] learning is how many of these talented individuals choose to leave in a given time period.
• Recognizing the Cost of Not Learning. Calculate the lost productivity from failing to use best practices known elsewhere in the corporation. Or the cost of delay in everyone recognizing a marketplace shift of delays in bringing a new product or service to the market. If you repeat mistakes, how many customers do you lose? What’s the impact to the bottom line? These measures can be more anecdotal than systematic, but they can reveal a pattern.

“If it’s worth doing, it’s worth measuring.” “That which is measured improves.” Don’t let the breadth and types of potential measures become a barrier to action. People will often use the argument that results are too hard to quantify in order to resist making an investment in learning. Once you make the commitment to be a learning organization, the willingness to measure results will shift. You will find new ways to track the effectiveness of initiatives, allowing you to learn better and faster the next time. The need to prove the business value of learning will also diminish as people will be involved in their own learning on a daily basis. You will become a learning organization.

What is a Learning Organization?
David Garvin, Harvard Business School professor, captures the essence of a learning organization in his book, “Learning in Action”:

An organization skilled at:

• Creating, acquiring, interpreting, transferring and retaining knowledge
• Purposefully modifying its behavior to reflect new knowledge and insights.

With a culture which…

• Stimulates, tests and adopts new ideas
• Encourages and rewards skills development
• Recognizes and accepts differences
• Provides timely, accurate feedback
• Encourages appropriate risk-taking and learns from mistakes
• Shares knowledge widely and rewards collaboration

Do you have a learning organization? Ask yourself the following questions:

1. Do you have a defined learning agenda?
2. Are you open to unfavorable feedback?
3. Do you avoid repeating mistakes?
4. Do you lose critical knowledge when people leave?
5. Do you act on what you know in a timely fashion?
6. Do you view learning as vital to growth?

Training Success is all in the Preparation

As in any aspect of life, if you want to get somewhere, you have to know where you are going. Otherwise, you get the results you've always gotten and wonder why things never change.

The same is true when designing training programs. In my field of performance consulting, I often talk to prospective clients about their past failed training programs. The comment usually sounds like, "Well, we tried that before and it just didn't work." My response is to find out what preparation was done prior to creation and delivery of the training.

In most cases, where "training" failed, the reason for the training was not properly identified and clearly linked to the business requirements. Or, management threw training at the problem, without truly assessing and understanding the core problem. Training programs that lack a connection with an established business objective are often doomed before they begin!

Key Questions Prior to Training Development

1. What business problem are you trying to solve?

2. Will all levels of the organization be included in the process?

3. What will success look like upon completion of the training program?

4. What obstacles will potentially hinder the implementation of skills learned?

5. What are the consequences for those that do not participate in the training?

6. What are the consequences for those that do not adopt the skills learned?

7. How will you measure success?

If any of these questions are left unanswered prior to development or implementation of a training program, the door is left open for failure, either in the application of the skills learned, or the justification of the training program in the eyes of management. Answer these questions clearly and everyone will understand what's at stake and recognize successful results!

Just Say No to TMI

If you are in the "Business at the Speed of Information" world today, chances are you are struggling with TMI (too much information). However much you may want to be informed about everything that's going on, there is no way you can keep up on it all without increasing unnecessary stress and derailing your productivity.

I receive at least 200 emails a day. Some come from lawyers in Uganda looking to give me money. Some come from company ezines. Some come from listservs to which I've subscribed. And some -- not too many, but some -- come from customers! If I thought it were important to read and respond to every e-mail, I'd be spending at least eight hours a day doing that. By the time I would get done, I'd have zero energy left to actually work!

One recommendation I've found for handling a deluge of e-mails comes from Bill Jensen, author of "The Simplicity Survival Handbook". Don't read every word, he says. Instead, scan them with the purpose of discovering what action is being called for. "If the communication does not contain an action and a short-term date [to complete that action], ignore it."

This applies to all communications. If hitting "delete" makes you worry that you're missing something, do it anyway, he says. There is a 69% chance you'll get the same communication again, a 48% chance you'll get it a third time, and a 36% chance you'll have to show up at a meeting or event to review it.

Bad Hiring Costs More Than We Think

I received an article yesterday from Training Magazine, and found the survey results interesting as they provided validation for concerns I've heard from clients recently.

According to the results of a study of 444 organizations throughout North America by Right Management (www.right.com), bad hiring and promotion decisions come with a significant aftermath. Lower employee morale and decreased productivity are the biggest consequences of these less-than-stellar hiring choices.

• 68% of survey respondents cited employee morale as a result of these decisions
• 66% said decreased employee productivity was a consequence
• 54% linked shoddy hiring and promotion choices to lost customers and market share
• 51% said not hiring and promoting properly means higher training costs.

And, that's not the only cost. Human resources gurus, trainers and organizational leaders who don't think carefully before making their next appointment could cost their companies money in other areas as well, especially when direct reports decide to hit the road.

• 44% of leaders, for instance, said bad hiring decisions result in higher recruitment costs
• 40% cited higher severance costs
• Recruitment, training, severance and lost productivity may add up to two times the employee's annual salary 42% of those surveyed said
• 26% said it amounted to three times the employee's annual salary
• 11% cited costs up to five times the employee's annual salary
• 6% said it's four times his or her salary.
• 15% said it's about equal to what the employee would have made in a year had they stayed

Source: Inside Training Magazine newsletter, May 11

Study Finds Hiring Right Personality Equal 14 Times More Engaged

In the course of my work, I've started working with companies that have high turnover issues (call centers, credit unions, hospitality, etc). It's no surprise that it costs a substantial amount of money to replace misplaced workers. What you see on a resume, and who shows up for an interview is [gasp!] only the tip of the iceberg.

In a recent DDI (Development Dimensions International, Inc.) survey, 44 percent of managers said their most significant hiring surprise was that a candidate’s personality in the interview differed from what they are actually like on the job. (Study of 3,800 employees in different industries and roles)

DDI identified six personal characteristics – adaptability, passion for work, emotional maturity, positive disposition, self-efficacy, and achievement orientation – that when combined help predict a candidate’s probability of being an “engaged contributor” in the organization.

Candidates which show a blend of these traits – which can be measured in pre-employment tests – are 14 times more likely to become highly engaged employees.

The study found employees with engaged supervisors were more engaged themselves and were nearly 20 percent less likely to leave the organization within a year.

Source: Human Resource Executive, February 2006

For additional information about assessments for hiring and development, go to http://www.trainutopia.com/Catalog/Assessments%20Overview.pdf

Create SMART Goals and Know When You Reach Them

As part of our focus on measurement, I'd like to demonstrate how employees and managers can learn to write "SMART" goals? Answer each of the following questions. If the answer to the question is anything other than "Yes", the goal needs to be refined (or in some cases, abandoned):

1. Specific: Does the goal have a single, well-defined result?

Compare a sales manager's goal of "plan meetings for next week" with "prepare agenda for scheduled sales, management and staff meetings so that all discussion is completed in less than 60 minutes per meeting." I'd even propose a higher goal: "increase sales revenue by 5 percent" or "decrease product returns by 2 percent" where the meetings include discussions and training on how to achieve these goals. In truth, planning meetings is not even a goal for this manager - it is an activity required to monitor how well his team and staff are doing toward achieving the goals.

2. Measurable: Can I clearly tell when it has been accomplished? Is there a date by which I will have it accomplished?

Next month is definitely measurable but I'd encourage you to go one step further : "Sign 15 new clients by June 30th." To keep you on track, create a dashboard of activities that can be measured to help you monitor progress and report results as you go.

3. Attainable. Is there some evidence that I will be able to achieve this objective, even though I may not yet see how?

Is this goal simply a hopeful outcome with small probability of success, or something that is truly within my reach? Will it stretch me, get me excited, put me at risk and cause me to think deeper?

4. Realistic. Given the time, resources and support available, is achieving the goal possible?

Are there enough suspects in my target market to support conversion to prospects? Is increasing sales by 8 percent realistic given the current product line, competition, economic climate?

5. Tangible. Is there something that will represent a visible result of this goal? Will it forward what I'm up to in my business/life?

If there is not a physical manifestation of the outcome, you won't know when you've reached the goal. If you can't see the progress you've made, you are less likely to acknowledge your accomplishments in the process of reaching your goals. Know when you "get there" so you can appreciate what you've done!

Dr. Fathi El-Nadi's Blog

As I was searching the Blog universe for like-minded individuals in my field, I found this gentleman's blog. His comments on assessment and testing of training are exactly my thoughts.

Dr. Fathi El-Nadi: Management and Human Resources consultant: Assessing And Testing Training Effectiveness: HR Consultant

Without a way to validate that learning occurred or that an improvement was made, what would be the point of training? It would be a waste of time and money, not to mention frustrating for the person delivering the intervention!

Tradeshow Tips from a Small Business Owner

As I mentioned in an earlier post, I was preparing for a tradeshow this week. I've learned a few things in the process of preparing and attending (as a small business owner).

One - Pick the right show on which to spend your money. I decided early on that I didn't want to join or participate in a group of my competition. I prefer to join associations or exhibit with my target customers. For instance, I'm in the training field, but I don't get many customers at a Training Expo...I can, however, find out who my competitors are.

Two - Know in advance what you want to cause and attract during the show. Although the show was expected to bring in international delegates from the World Congress of Information Technology across the street, I was more interested in the other exhibitors as prospects. My goal was to get 25 qualified leads as a result of my presence there (Result - 6 excellent leads and an additional 12 maybes). I also created a way to measure my results - I created a lead qualification form. I know who I spoke to about what and how urgent their need is.

Three - It's up to you to "cause" the action. If you are sitting behind a table with your arms crossed, no one will show up. If you stand up outside your booth and create a welcoming presence, people will always smile and often stop and chat. The Law of Attraction also comes in - when there are people at your booth talking, it attracts more, and before you know it, there are too many for your team to address. I like having THAT problem!

By the way, it really doesn't matter what "goodies" you are giving away - some people seemed skeptical of taking freebies, as if it created an obligation to do business...

Next step is even more important...FOLLOW UP! (again, part of the system)

Mike Beitler's Blog

This is a blog from someone whose views I really appreciate in the area of organizational change and performance measurement:

Mike Beitler's Blog

Preparation is Priceless

I love to plan - lists, to-do's, systems, etc. One of the areas that I've been finding more and more important in my business is creation of systems. If you can create a system, then you can repeat it. When you can repeat something, often you can re-produce results.

Here's the key:
If the results are good, keep the system. If the results are bad, investigate where your system is flawed and make the necessary changes.

I am exhibiting in a big tradeshow tomorrow, so I put everything that I need to do and take into a master checklist. I've been adding to the list for about a week. I'm sure there will be something I've forgotten. However, I have everything assembled to cart down to the show. Anything I missed will be added to the list, not to be missed for the next show.

Next step is an inventory of my systems...

Dipping My Toes in the Blog Water

It was recommended to me that I begin a blog....

Hmmmm, I'm not convinced that I can come up with something to say each day. I'm willing to give it a try for the next month and see what ideas get sparked, opinions get reached, and people get intrigued by my views on the training and performance world...