Hello, Network newsletter readers! When I recently met Ed Parr and heard him speak, I was impressed with his credentials and intrigued by his message. Wanting to share the wealth with you, I scheduled an interview with him right away. Below is the first in a series of three newsletter articles for you, from our talk…
CAPITALIZE on the CURRENT CRI$I$
Joe: I’m talking to Ed Parr, author of Natural Born Manager. Ed is a Certified Management Accountant with 35 years’ management experience, ranging from team leader to senior executive. He has managed as many as 1,000 employees deployed in multisite facilities with contracts as large as $30 million, and consulted with or managed for both large and small organizations, including Bank of America, E.D.S., JPMorgan Chase, Sprint Nextel Corp., PricewaterhouseCoopers, US Treasury Dept., and USAA. In addition, Ed is a 10-year contributor to AllExperts.com as a pro bono management expert.
Ed, what should employers do during times of economic downturn to keep their employees when hiring ramps back up? I guess what I’m asking you is what steps should you take to assure you’ll keep your best employees when the economy rebounds?
Ed: The answer is very basic. If you want to keep your best employees, you’ve got to lose your worst leaders. Begin to cull your people in a down economy. So you must identify who those worst leaders are.
Joe: Any suggestions for how to identify the worst leaders?
Ed: In my book, the Leadership Outliers Sorting Tool (LOST) identifies 56 management behaviors managers in an organization should NOT exhibit. You can use that LOST tool as a behavioral survey to determine which managers are wrong for the job. The survey results rank from top to bottom as a:
- HUGM (highly unusual great manager),
- potential manager, or as
- MINO (manager in name only).
Joe: OK; you’ve sorted good from bad; what’s next?
Ed: Next, each of the HUGM and potential managers participate in aptitude testing by the Johnson O’Connor Research Foundation (JOCRF). (The LOST survey indicates those who rank as a MINO cannot manage; so there is no point to assess them beyond the LOST survey.) This JOCRF aptitude testing determines whether or not the tested managers possess the Sublime Nine Management Aptitudes, specific aptitudes I’ve determined essential for one to be recognized as a Natural Born Manager. The test results identify which managers qualify as a certified Accountability Manager and which ones will be reassigned to non-managerial roles based upon the best match of their strongest aptitudes to their new job.
Joe: And you use a down economy to cull the worst leaders because, when economy comes up, it may be hard to build a case to let somebody go?
Ed: Yes; it’s very logical: Today’s economy can be an opportunity for senior executives, in the sense that, in a down economy, when businesses are trying to survive, you can wipe the slate clean of problems. Identify where your bright spots and dark spots in your organization are and take out the dark spots so the bright spots can shine more brightly.
Joe: As they say in politics: “Never waste a crisis.” As a leader, a down economy is your opportunity to eliminate some people, to capitalize on the current economic crisis.
Ed: For every top tier person, you have lower echelon employees who are excellent, and you want to make sure that those lower echelon employees are happy. They’re going to be happy if they have a top tier manager who is a good leader.
Joe: When people rank the reasons to leave a job, they rank the money as about 6th or 7th. The #1 rated reason people leave is for work content and responsibility. Also above the money is managers. Is that why you would focus on the managers?
Ed: If you fix management, you’ll fix everything else. Why? Because great managers look for people’s aptitudes, they love to put people in the right jobs.
Joe: Let’s talk about something that many managers do. The common tendency is to spend time where the most problems are. Most managers spend 80% of their time with the worst 20% of their people. What can companies do to lock the top 20% into place, getting them affixed and thinking of long-term with your company? What are the best things leaders can do to engage those top employees?
Ed: Capitalize on very basic human behavior—when you do something well, you want to do more of it. People are going to stay with a job they enjoy, when all aspects of a job are joyful. They will stay with their company when they have the right fit, they are doing the job they were made to do, are compensated reasonably well, led well, and the company has good prospects. That’s foundational. Sure, employment benefits, etc., play a part, but you’ve got to have the person well suited to the job he or she is doing. That’s also how you fix the #1 reason for leaving: wanting a change in one’s work content and responsibility. When a job fits an employee’s natural abilities, they will naturally be given more responsibility.
Joe: Do you find that most of the best employees already have a job that fits them well?
Ed: Not necessarily. I stress that, as a leader, you’ve got to identify your best employees. Some of those best employees are simply people with a great work ethic, who could do many jobs in your organization well. Try to move the problem employees out of the mix, and put that energy on working with those best employees to identify what their aptitudes are to identify their best fit—where they will produce the greatest result in your organization. Make the best employees even better. Move your best employees to a job where they’ll succeed because of their natural gifts, and they’ll not only produce even better results for your organization, they’ll be happier and love their job more.
Joe: So the key is to use this time to match your best employees with the jobs that fit their natural aptitudes?
Ed: You basically leverage their talents to get more from them, but in a cooperative sense, because they want to do more. If a manager can say, “OK, I’ve got five great employees here, and I need to rearrange their responsibilities and duties this way during these tough times to get them into that right fit job, so that as things improve, they’re going to like their job more than they did before.” That also makes your compensation easier because those five employees will now be performing at a much higher level because they like their work more. Because they now work in a position where their natural abilities fit their job so well, you will be able to identify units of measure they can fulfill that will compensate them very well for their contribution to your organization.
Note: Watch for article 3 in this series, Fixing Management Can Fix More Than Your Bottom Line, for more detail on this process.
Joe: So identifying their best fit in your organization can help you keep your best employees, and one of the additional benefits is that they naturally become more useful to your organization so you can logically pay them more.
Paying your best employees well is important. As a new recruiter, I naively thought that one of my clients was paying too much. However, later in my career, I realized how smart they were. Chevron made their employees unrecruitable by paying them 25% more than any of the other companies; and with some employees they even paid 30%-40% more. As a result, many people worked for them 20-30 years. They paid so far above market that their employees were unrecruitable. Many firms want to keep their pay scales at the 51% level to be above the mean; but, where’s the advantage if your compensation is just above the mean? That leaves the good employees vulnerable. Why not seek to put your key people in the top 20% on salary so that they become unrecruitable…to get to Chevron style retention?
Ed: That presupposes that your top 20% are worth that. You need a compensation system that reports their worth. You want to keep your best people, so you have to measure their performance continually. A great performer today can have events take place in their life that change their performance overnight. You have to continuously monitor performance and find out what’s going on in their lives to find out if this job is still right for them.
In Natural Born Manager, I recommend using the Behavior Accountability Model (BAM) to assess people’s performance based on their behaviors. BAM is a tool (based on the work of B.F. Skinner, Ogden Lindsley, and Dr. Aubrey Daniels) which can inspire employees to be accountable for “best in class” results. The BAM model encompasses the following steps:
- Identify Strengths and Weaknesses
- Set Goals for Desired Results
- Create a Scorecard
- Monitor Progress
- Celebrate Wins
Note: Watch for more about BAM in article 2 of this series, Motivate with More Than Just Money.
Joe: So there’s much businesses can do in economic downturns that simultaneously trim staff, increase production and help you fit your best employees into jobs where they’re more likely to stay with your firm. That’s good news!
We’re talking with Ed Parr, author of Natural Born Manager in the first of three articles from our interview with him. Ed, can you summarize Natural Born Manager for us?
Ed: Natural Born Manager is a template for how to find your passion in life. I use managers because I know managers. I focused on using managers as my template because I wanted to help the world find the best managers. But the text has broader application for individuals also: It turns out that the process used to select great managers is exactly the same process that one uses to choose the perfect career.
Joe: This book contains a wealth of information for people in business. Ed, how can my Network newsletter readers reach you?
Hiring? Call us at 800-786-1099 or email me direct at email@example.com.
Joe Pelayo, C.P.C.
Joseph Michaels International
Global Recruiting Solutions
One of the top 75 Recruiters in the United States ~ Recruiter Life Magazine