The Hire Sense » 2007 » October » 02

Archive for October 2nd, 2007

A Tourniquet For Talent Bleed

Last week, Lee posted about a company that terminated a salesperson via voicemail while he was at home sick.  That’s low, but this company is one that has a long-standing problem regarding turnover.  We know this salesperson fairly well and we know he has significant sales talent.  Yet he is one of many strong salespeople who have left this company or been terminated by them.  It is almost part of their culture (that’s not hyperbole).

This CareerJournal.com article – Best Way to Save: Analyze Why Talent Is Going Out the Door – addresses this very issue.

Rather than deny a talent bleed, executives should carefully analyze why it is happening. Carl Bass, CEO of software maker Autodesk, has found that employees are most likely to accept offers elsewhere if they don’t think they are being challenged to grow. Most frequently, they leave if they don’t get along with their boss.

More times than not, it comes down to the manager.  What is remarkable about the aforementioned company is that the manager has a history of turnover.  Abundant turnover.

Early in my career, I worked for a manager who had a similar style.  He was more interested in riding herd over the sales team than he was in growing the department.  I did not appreciate his approach and finally told him my analysis of his management ability.  I was eventually fired.  I didn’t care because I had gotten to the point where dealing with his petty tortures on a daily basis was more painful than being fired.

Turnover is a symptom, but it is not the disease.

I worked for another company that had many talented salespeople (far more talented than me) who left over a couple of years.  The reason – no place to grow within the company.  Though it was a technology company, there was an established order for promotion that was not broken.  I eventually left too once my job became routine.  I was making great money, but I was bored every day.

Here is a management approach I would have appreciated:

“You can’t be a slave to your structure and tell a very talented director he can’t be promoted to the next rung until a vice president leaves,” says Mr. McClure.

He tries to craft stretch assignments for his best employees that may not have existed before, but fill a current need. He urges employees to get out of their comfort zone and raise their hands for jobs in unfamiliar areas. He has encouraged some sales managers, to spend time in operations, where they can learn about product flow, delivery and other technical issues. The stint broadens their experience so they’re qualified to become general managers.

And in case you think compensation is a small part of the hiring equation:

Salaries that lag behind the norm leave talent open to even modest offers.

I still think salary is a key component to stopping talent bleed.  I stayed at the aforementioned company longer than I should have simply due to the pay.  If you choose to underpay your employees, you do run the risk of pushing them into the market.  Information flows freely today so discovering the “going rate” for your position is not difficult.

Of course, I could be wrong:

Although employees on exit interviews often cite pay as a main reason they’re moving on, they’re often more influenced by what colleagues are doing. “If someone’s best friend is leaving, he or she is more likely to leave, too,” says Jim Harter of the Gallup Organization, “especially if their interchanges become “gripe sessions about an employer.”

I’m more influenced by compensation – probably due to my Utilitarian drive.

Lawyers, iPhones and Money

In case you haven’t noticed, senseless lawsuits absolutely push my buttons. So now this comes along – Woman sues Apple for $1M over iPhone price cut.

The gist of her complaint:

A New York woman is so angry at Apple Inc. for lopping $200 off the price of the iPhone that she’s filed a lawsuit seeking $1 million in damages.

Dongmei Li of Queens, N.Y., claimed the company violated price discrimination laws when it slashed the price of the 8-gigabyte iPhone by a third, from $599 to $399, within two months of the gadget’s June debut.

According to Li’s lawsuit, filed on Sept. 24 in the U.S. District Court, Eastern District of New York, the price reduction injured early purchasers like herself because they cannot resell the product for the same profit as those who bought the cell phone following the price cut.

Who resells cell phones? $1 million in damages over $200? Excuse me, but I have to go bang my head on the wall for a while.