Worried About the Cost of Getting Higher Engagement? Maybe it Saves You Money.

The January-February Issue of Harvard Business Review features “A Great Place to Work” as its primary theme. Reading the article on Netflix I was most taken by several comments recommending to the kinds of people to bring into your company. The first of these goes as follows…

“The best thing you can do for your employees, a perk better than foosball or free sushi, is hire only “A” players to work alongside them. Excellent colleagues trump everything else”

                                                       Patty McCord, former Netflix Chief Talent Officer

At first glance the idea of hiring “A” players might be a bit confronting. You certainly want be improving your workforce but “A” players, wow that might be a high bar to shoot for. You might rightly wonder why the best and brightest would even want to work for you, after all what you’re into isn’t exactly rocket science and why would you want to pay best and brightest money to people doing work that doesn’t require best and brightest talent? Wouldn’t the best and brightest get bored no matter how much you paid them and eventually leave contributing to higher turnover costs than you already have? OK, let’s step back.

If this is how you reacted to the quote from Patty McCord you might be stuck with a mental image of what she means by “A” players. She goes on to clarify that when she refers to hiring the right people she is really talking about a moving target, what you need in a work force that is right for your business now, and this is going to evolve over time. This in fact may be more confronting than the idea of hiring the best and brightest, which you could rationalize away on the basis of cost versus return alone.

What McCord says that really challenges the average employer is “Excellent colleagues trump everything else.”

Who among us has not entered a workplace where we encountered a long time employee who upon casual observation could easily be found to be obstructing the daily flow of work by simply not being up to speed with the current levels of skill required to perform as the business needed. How often have we raised a question about the presence of this employee only to be told that they had been here a long time and were really loyal to the company? Then we might be asked to make it work with him or her. Clearly the competence of this employee was deemed to be something we needed to live with. How often I wonder have any of us left or declined to recommend a company simply because there had been some demonstration that something other than performance excellence was the order of the day?

As McCord continues to share her insights about the Netflix culture she emphasizes that maintaining an excellent level of employee requires a constant level of vigilance as well as a willingness to address both unacceptable behavior and performance in a straight forward manner. Honestly I think there are two features of a workplace that are more distasteful to the kinds of people you want to employ. One is a cumbersome policy handbook and the other is a patently CYA performance review process. Here is what McCord has to say about the issue of policy in place of high expectations and I couldn’t agree more…

“If you are careful to hire people who will out the company’s interest first, who understand and support the desire for a high performance workplace, 97% of your employees will do the right thing. Most companies spend endless time and money writing and enforcing HR policies to deal with problems the other 3% might cause.”

Over policing while tolerating underperformance puts good people off and sends them looking for other places of employment.

The second unattractive feature identified by McCord that simply screams mediocrity may not be as much an issue for smaller employers as it is for larger ones, the CYA performance review process. This is hardly even worthy of explanation because it is so prevalent; fear of litigation drives these processes. We all know it. We also know that a related practice, the Performance Improvement Plan, is equally bogus and simply a notification to the employee to pack their bags as they have about 90 days before termination. Nothing could be more transparent, nothing could be more unattractive to solid performers with a desire to see underperformers dealt with quickly with dignity and respect.

The bottom line here; if you want an engaged workforce select new employees carefully, develop them with care, prune the workforce regularly, maintain skill levels across the board, treat everyone like adults and expect them to behave that way. You may pay a little more on the front end but over time the payoffs will more than cover the investment.

 

 

 

 

    

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