Attracting Stars Is Lucrative—and So Much More
“If I were running a company today, I would have one priority above all others: to acquire as many of the best people as I could. I’d put off everything else to fill my bus. Because things are going to come back. My flywheel is going to start to turn. And the single biggest constraint on the success of my organization is the ability to get and to hang on to enough of the right people.”
—Jim Collins, American business consultant and author of Good to Great: Why Some Companies Make the Leap...and Others Don’t
Businesses that have “A” players in every key seat outperform businesses that don’t by between three and ten times, depending on which source you read. Compared to getting this right, nothing else in your business matters much; it’s the issue that should be uppermost in your mind, and, like a coach of a sports team, you should be spending at least half of your head space planning, plotting, and scheming over how you’re going to achieve this goal.
If you don’t believe it, think for a minute about your very best employee. What would you do without that person? How would you feel if he left the company? How many people would it take to replace him? Now imagine what your business would look like if you had someone as good as him in every important role in your business. Forget your business—what would your life look like? “A” players are a joy to work with!
If you’re taking an issue home with you; if you’re talking over a business problem with your spouse; if you’re lying awake at night, mulling things over in your mind; if you’re “stuck” while facing an impossible hurdle; if you feel burned out or you’re thinking of selling the business and doing something easier, the vast majority of the time you’re wrestling with a people problem.
That problem may appear to be a financial or inventory or logistics or customer service issue, but usually the presenting issue is just the dummy light blinking on the dashboard. In other words, the “issue” is only a symptom that can be traced back to a root cause, and usually that root cause is a person. It might be a great person in the wrong seat; it might be an awful person in an important seat; it might be someone who was once great and who is now sitting in a seat that has outgrown him or her.
Incidentally, leaders don’t usually burn out due to overwork, because productive work that you’re good at can be very energizing. More often, burnout comes from playing with weak players. This forces you, the leader, to sit in your own seat, plus cover other, weaker players’ positions (which are often ones that you’re not good at or interested in doing). Being forced to do things that you’re not great at is exhausting.
As a Leader, You’re in the People Business
Once you have employed more than five people, you’re no longer in the food service/manufacturing/retail business, you’re in the people business! Although you can use many great initiatives and programs to upgrade your company, this one—the people business—must precede them all; if it doesn’t, you’re throwing your money away. Without the right people in the right seats, having the right strategy doesn’t really matter—nor does having a war chest of cash or a great business idea, or a host of employee training sessions, or the latest, greatest quality program. Without the right people in the right seats, nothing works. Best team wins!
If you want to change your life, reduce your stress, and make your business lucrative and fun, first you’re going to have to sort out your people problems.
The Container Store is very public about its winning equation: one great person = three good people. When founders Kip Tindell and Garrett Boone opened their first store in 1978, their organizing principle in human resources was simply to persuade their best, most loyal customers to join the company, become top-performing employees, and pay them more—a lot more—than the industry average. The founders also invested a tremendous amount into them, giving first-year full-time employees 263 hours of formal training (compared to the retail industry average of eight).1
In a sector in which the average employee doesn’t even stay a year, turnover at the Container Store is less than 10 percent, and a third of the company’s 2,500 workers come from referrals. The company reported 20 percent growth every year since inception to 2014. In short, the Container Store focuses on finding top players—or what we will refer to from here on as “stars”—and their superior results follow.
Attracting and retaining stars is clearly lucrative for a company, but it is also so much more. Stars don’t need to be motivated. They need to be coached, trained, career counseled, encouraged, and sometimes corrected or even disciplined, but never motivated. They’re self-motivated. They make fewer mistakes, have better relationships with customers, and are never at the center of internal drama. Because you and others trust them, everything moves faster. They aren’t involved in efficiency-killing turf wars. They don’t need someone to double-check their work or repair their relationship problems.
Finding people that you both trust and love is not just about generating warm feelings, either. These people show up on the bottom line of your income statement.
In Good to Great, Jim Collins’s ground-breaking study of good companies that became great (companies that beat their closest competitor by three or more times over a fifteen-year period), the first two steps every great company took was to, first, get the right leader and, second, “get the right people on the bus, and the wrong people off the bus.”2
Your Top Three Priorities as a Leader
Your job isn’t easy, but it’s not complicated, either. It’s simply to:
1. Find the best possible players for your team.
2. Tell them clearly what they need to do in order to win in their role.
3. Let them know how they’re doing and coach them on a regular basis.
These three tasks represent the main themes of the chapters that follow. They aren’t complex; in fact, on the face of it, they seem ridiculously simple. But have you ever worked for a company that followed these three rules? If you’re like most people, it’s not likely. Most leaders are content to work with sub-par players, assume they’ll figure the job out on their own, and never get around to giving them feedback unless something has gone outrageously wrong.
But I believe in finding the best players, making sure they are clear on what they are there to do, and then using every engagement with them as an opportunity to train, model, coach, and build their self-confidence.
As a young guy in a sales role, I was challenged by a speaker on tape to write out my one-phrase job description. This interesting exercise cuts through a lot of clutter. Mine was “to increase hot tub sales through existing and new retailers.” That’s it. This obvious revelation was tremendously focusing for me. I taped it to my computer monitor. It reminded me that I wasn’t there to answer phones or compose emails or attend meetings or talk with guys in the factory, although I did all those things. My job was to sell.
When that kind of clarity is paired with regular feedback and coaching, results will follow.
Learning to Lead Your Team Well
Market research firm Harris Interactive surveyed more than 23,000 people employed full-time in industries including accommodation/food services, automotive, banking/finance, communications, education, healthcare, military, public administration/government, retail, technology services, and telecommunications. The poll was designed to measure “the execution gap”—that is, the gap between an organization setting a goal and actually achieving it. Here are some of their shocking findings:
• Only 37 percent of respondents knew the company’s goals.
• Only 20 percent were enthusiastic about those goals.
• Only 20 percent could see how they could support those goals.
• Only 15 percent felt empowered to work toward those goals.
• Only 20 percent fully trusted the company they worked for.3
Imagine if this were your team. Less than half of your staff would know exactly what they were supposed to be doing. One in five would be excited about their job. One in five would be sure about what they were supposed to be doing at work, and in any case, fewer than one in five would feel trusted enough to work toward the goals that they didn’t understand in the first place. And the really painful kicker is that one in five wouldn’t even trust the leadership team enough to care if they won or if they lost to the competition.
How would you feel about being on a team like that? How would you feel if you were the coach of a team like that? Are you sure that you’re not?
If you want to build an amazing team, it may require a shift in thinking about your own role. We often use the term manager to describe someone who is in charge of people. However, this term reinforces the illusion that people can, in fact, be “managed.” We need to begin to think of ourselves as leaders or, better yet, coaches.
A manager builds, streamlines, and monitors systems and processes. A manager works with things, because things—such as inventory levels, food and labor costs, allocation of capital, or product quality—can be managed. You can manage things, but people are inherently unmanageable. They are filled with unruly emotions and personal problems, and, even though they may have the skills you need, can display an amazing range and variety of attitudes. People require leaders.
Most weak “people managers” view the people side of their role as a noose around their neck that they would love to be able to slide out of. They don’t realize that “who” questions are always more important than “what” questions. In truth, you can’t be a people manager. You can only be a poor leader who leads people badly, or a good one who leads people well.
You’ve gotten this far, so it’s clear which one you want to be, so let’s get started on the journey.
People Action Steps
• Find the best possible players for your team.
• Tell them clearly what they need to do in order to win in their role.
• Let them know how they’re doing and coach them on a regular basis.
In Summary
• If you can build a team of “stars” all rowing in the same direction, you can dominate any industry.
• Companies that do the hard work of finding star players for every key seat are much more profitable than those that don’t. It’s the first and most important step on the path to achieving results up to three times those of your closest competitor.
• Learning to hire and retain stars is the key to winning in your business.
• You can’t manage people. You can only lead them well or badly.