Lean Connections

Perhaps you too have seen the recent survey by the Corporate Executive Board (CEB). 

Which way out?

Looks like 25% or so of the executives whom surveyed companies have identified as “high-potential” leaders plan to exit their respective companies within the next 12 months. Oops!  (Not sure how they actually got to this number – would you be telling your CEO of your plans to get-outta-Dodge?)  My guess:  the number is probably much higher.

So, is it too late for intervention? Can these organizations salvage the situation? 

The same survey indicates that an additional 21 percent (so now we’re looking at 45% total) of employees today (yes, your employees!) identify themselves as “highly disengaged,” and this percentage has risen, alarmingly, by about 300% since 2007.  Perhaps these statistics would be different today if more companies were doing some basic things a bit better, and if one of the foundational principles of “Lean Thinking,” respect for people, were at the core of their best people practices.

The CEB goes on to describe some tactics which companies might want to implement to re-engage and more effectively manage high-potential employees (though more progressive organizations might actually want to call them associates or team members):

• Stimulate — Emerging leaders need stimulating work, recognition and the chance to grow. If your company doesn’t provide these, they can quickly disengage.
• Test — Explicitly test candidates for internal promotion for ability, engagement and aspiration to make sure they’re able to handle the tougher roles as their careers progress.
• Manage — Having line managers oversee high-potential employees only limits their access to opportunities and encourages hoarding of talent. Instead, manage these high-potential employees at the corporate level.
• Challenge — High potential employees need to be in positions where new capabilities can — or must — be acquired.
• Recognize — High potential employees will be more engaged if they are recognized through pay, so offer them differentiated compensation and recognition.
• Engage — Incorporate high-potential employees into strategic planning. Share future strategies with them and emphasize their role in making them come to fruition.

Now, for you Lean Thinkers reading about these “new” insights, the CED prescription doesn’t really sound all that revolutionary, does it?  Maybe different words, yet very similar to what Lean Leaders actually do when they engage in “manager standard work.”   My guess is that Lean implementation, done the right way with people and continuous improvement in mind (not just thinking about tools), still has a long way to go in most North American companies.  Especially in those which will find the the CED survey and Harvard Business Review article revealing to them something which they apparently don’t already know.

Treat the executive you’re recruiting as well or better than you would your best customer…

The recruiting process to identify your company’s new CFO has been thorough and professionally executed. Your search committee, your retained search firm, and all key stakeholders were fully engaged from the start. It went smoothly, quickly, and in fact, better than you expected, given these turbulent economic times. You vetted the top players in your industry, and a few outsiders who contributed some creative insights and energy into your deliberations.   And now you’ve narrowed your choices down to three, but one is clearly a standout.

It’s time for crafting and extending the offer.  And, as SVP Human Resources, it’s your job to figure out “now that we’ve given the nod to Samantha Pink – by all measures our best candidate – how are we going to convince her to move for this job?”

Oops. Too late. Anything you do at this point to “convince” Samantha will rarely amount to more than just rolling the dice. The “convincing” process should have begun the day she came onto your radar screen as a potential candidate.  Paving the way to structure an offer which your selected candidate will eagerly accept must begin long before you’ve arrived at this moment. And I would argue that it is one of the most critical components of the executive search process.

The simple truth is that candidates today, particularly at the Vice President level and above, are becoming extremely selective in terms of the companies and positions they’ll consider for career opportunities. So many variables now enter into the career-move equation that it’s easy for a prospective employer to get blindsided at almost any turn.  Consider such factors as corporate financial uncertainties, executive personal, family and financial concerns, and dramatic real estate market upheavals across the country, and it becomes even more important that you do a lot of things right along the road to attracting the best new leaders to your organization. Too many mistakes on your part and you’re sunk; it’s not easy to recover with an offer of a big title or promotion, or even a major bump in compensation.

So instead, as my colleague Stephen Covey wisely preaches, “Begin with the end in mind.” Here are some strategic ideas you may want to consider:

1. Clearly define exactly what it is that makes you the employer of choice in your market space.

It’s a major hook for top candidates, and you’ll need this ammunition during your courtship process, and again at offer stage. Identify the factors which the executives and associates who work for you find so attractive that they simply wouldn’t consider going anywhere else.  Share and relate in your candidate discussions.

Also, realistically understand and prepare to address any concerns or perceptions, valid or maybe even not so valid, regarding your weaknesses (financial, legal, market, product, etc.). Johnson & Johnson, for instance, has a factory out there that just isn’t making the grade right now. It’s creating massive recalls of children’s medication and a PR disaster. J&J needs to be openly discussing this problem with anyone they’re recruiting, right from the very start – and describing how they’re fixing the current situation and preventing recurrences.

Above all else, prepare yourself with extensive market intelligence to answer, over and over, the ultimate (and sometimes never directly asked, but always there) candidate question: “I’m happy and well-paid where I am. Why should I leave and make the move to your company?”  Hint: your corporate culture, also mentioned by Groysberg (below) could have a lot to do with it.

2. Don’t write a job description; create a “career opportunity blueprint” which communicates how and why the candidate can, will want to, and will, do great things working in your business.

About 50% of today’s corporate job descriptions are meaningless. For the most part, these comprise laundry lists which somebody long ago downloaded from the Net and keeps on inserting into what should be meaningful strategic tools for business planning and growth.  And the other half, well…  

According to Harvard University’s Boris Groysberg, one of the top three mistakes executives make when changing jobs is believing this stuff. Well, actually he writes: “assuming that the given job title and description accurately reflect the position.” Is it possible that the employer creating such a document is at least partially at fault for this misunderstanding?

All too often, job descriptions share a common problem: They lack strategic focus. They concentrate on the tasks the manager is expected to perform and the activities he or she must engage in. There are lists of specific duties, responsibilities, personal characteristics and so on. But these descriptions are severely lacking in the most critical element of all: the performance objective.

To attract dynamic, performance-driven executives to your organization, position blueprints must focus on desired outcomes for your company, not on the tasks required to get there. Each position must be defined in terms of how it contributes to your company’s success. This is what allows the executive to understand how he or she contributes to the business unit. It strengthens the commitment between the executive and the company, empowers better decision making, and aligns the executive as a true stakeholder in desired outcomes.

And it communicates how and why the candidate will be able to do great things by working with you in your business. Could be the tie-breaker that lets you win over your next “A player.”

3. Treat each candidate as you would your best customer, and serve her well.

How much do you think Zappos.com knows about each customer?  About their best customers?  I’d bet it’s a lot more than name, address and shoe size.  And how does Tony Hsieh utilize that information to make each customer’s experience more personal, more memorable and more valuable?

Strive to make each candidate’s experience personal, memorable and valuable as well, at each step of his or her interaction with you. Well before that offer stage, you need to understand the individual’s decision factors which will play into offer acceptance, and reduce the possibilities of turn-down. The professional and personal factors, the intellectual and emotional ones, those which are clearly communicated and obvious factors,  and also those so deeply hidden they  rarely surface out into the open. But they’re all there, and they’re all very real to each and every candidate. Make them real for your recruiting team as well.

So how many school-aged children do Samantha Pink and her spouse need to worry about in case of a relocation? What’s his career like and how do his plans fit in with the couple’s long-term personal and financial goals? How will they manage his career transition?  Of course they own a home, and most likely in a top neighborhood where other C-level executives choose to reside.

Have you already begun to do some advance networking with your C-level contacts and your local HR colleagues in anticipation of confidentially introducing Johnny Pink around before he begins his own job search?  Have you had someone on your team dig into the details of how difficult it will be for them to sell their home, and determine what neighborhoods near your corporate HQ would provide a similar lifestyle experience  (including schools) for their family?  Or, have you explored potential temporary residence options in Samantha and Johnny’s home town, as well as in yours?  Have your prepared to discuss executive commuting options for one or the other, or even both, as an alternative to full immediate relocation for the family.  And how about yet other alternatives in the event their high school basketball star adamantly resists relocation before finishing out his senior year?

It’s never going to be possible to anticipate every scenario which could potentially block your number one candidate from accepting even the best and greatest compensation and lifestyle package you can put together.  But the degree to which you’ve effectively listened and understood, researched and prepared, from those first moments of your executive candidate interactions, you’ll be way ahead of the game.

Finally, to actually address my colleague’s question which prompted this mini-essay: No is the answer.  There is no magic. We’re all Muggles here. If your top candidate needs to sell her home and will not take a loss on the sale, which therefore requires you to subsidize the cash deficit with a sign-on bonus or stock options or restricted stock, then that’s what you’ll have to do.  Trust me: she will walk away from your “the best we can do” compromise offer. Move onto candidate number two.

And that’s the way I see it.

In his role as CEO of Adam Zak Executive Search, Adam Zak recruits “A” players.  Then, in their new executive roles, these talented individuals go on to make their new companies simply excellent. Adam has been using his uncommon expertise to help clients improve their businesses operationally and financially for almost 20 years. Find him at http://Twitter.com/LeanThinker.

Adam’s new book, Simple Excellence: Organizing and Aligning the Management Team in a Lean Transformation, will be available in November, 2010, from Taylor & Francis/Productivity Press, publisher.