A Compulsion to Fix Things

Tuesday, January 27, 2009

This past weekend I was reminded of how I am cursed with a need to fix things. This is a shame because I really don’t have the training to do so.

I’m not talking about psychology here; I’m talking about things…household things. For instance, during the first 18 years of my marriage I kept a clothes dryer “alive” that had been given to us when my wife and I were first married. And, when it was given to us, it was already ten years old!

My initial commitment to a yearly ritual of reviving this old clothes dryer began with the poverty-driven need I had in graduate school to save cost or starve. Out of desperation, I would extract broken parts and take them into the appliance parts supply store. It was common for the counter guy to invite the entire staff out for a good laugh and history lesson about “the days when all parts were steel like this one.”

My compulsion continued long after it would have been less time consuming, more energy efficient, and well within my financial capabilities to replace the monster. But, I was not to be defeated. I simply had to fix it.

This past weekend my water heater began leaking. My wife and I actually had a fight over this ridiculous compulsion of mine to prove that “I’ve still got it”. And, of course, the need to save a few bucks.

It took all of Saturday to do the research and all of Sunday to install it. Around the Mashburn house that evening you could hear things coming out of my mouth like, “We’ve got hot water”, or ”Try taking a bath”. It was like I had done something powerful and magic. I think I felt manlier.

What does this have to do with recruiting, coaching or personal performance you ask? Does this somehow apply to the subject matter of this blog? I have no idea. Maybe someone smarter and more creative could come up with some compelling esoteric description of how this could help you, but not me. I was too focused on conquering my water heater over the weekend!

Resilience Revisited: Avoiding Anxiety Paralysis

Monday, January 26, 2009

Before the holidays, we wrote a couple of articles on resilience. The articles highlighted the research of Dr. Salvatore Maddi and summarized the principles that he discovered.

Last week, Business Week did an article on resilience as well. In today’s economic climate, it’s a topic that interests a lot of us. Like the bathroom plunger under the sink, I don’t care for the circumstances that require me put the tool into use, but I am glad I have it.

Dr. Kerry Sulkowicz makes it clear you’re going to need resilience if you’re going to maintain a clear head during tough times:

“Many psychologists consider [resilience] a key component of emotional health. Resilient people, they have observed, are naturally better at containing their anxiety. And that enables them to see in hardship the seeds of opportunity. What would emotional resilience entail in the face of the current crisis? The ability to resist being swept up in the global state of panic and to adapt as creatively as possible to one's setbacks and losses.”

We see this principle played out with our clients every day. Some people are not very good at containing their anxiety and they become paralyzed as a result. But, others are busy working to find new opportunities. We all feel the strain, but some people have figured out how to use that strain as a catalyst for action.

If you find yourself in the second group, Dr. Sulkowicz has some advice for you:

“But just as there is no shortcut to emotional health, you can't become resilient overnight, or by sheer will, or by reading the latest book on the subject. Instead, resilience is acquired through increasing self-awareness. You must connect with trusted and candid intimates who help you build confidence. You need to repeatedly expose yourself to a range of difficult circumstances and then overcome them.”

If you’re responsible for coaching those around you, this is a great opportunity. You’re the “trusted and candid intimate” your protégés need to overcome their anxiety. Can you help them identify the things they are already overcoming? This is the foundation to build upon and can give them courage to take on the next challenge.

If you’re struggling yourself, then you need to connect with others who can provide you support. The first tendency will be to just talk with those who will compassionately identify with our circumstances. While this may help, we also need those “tough love” friends who can give us the push to take on the next challenge.

Editor’s Note: Did you miss the previous articles on resilience? Click on the following links to catch up:

Resilience: Are You Able to Thrive Under Stressful Conditions?

Resilience: Are You Able to Thrive Under Stressful Conditions? Part 2

The Stars Might Lie, but the Numbers Never Do

Friday, January 23, 2009

Yesterday, I told you I would follow-up with an example of how using metrics has equipped us to save our clients a significant amount of money on candidate advertising.

A few months back, we were interested in buying advertising in a metro area where we had a major client. The client needed to source more than 500 candidates per month to meet its hiring goals. In
this metro area, there is a regional job board that is very prominent—you see its ads on the sides of buses, at bus stops, on trains, and you hear its ads on the radio. It constantly refers to itself as the #1 job board in this metro area.

We inquired about advertising on this company’s job board. The prices were high, but its claims of traffic to the site were high as well. Since we had been advertising in this city for more than a year, we had reliable metrics on this vendor’s competitors “advertising cost per applicant.”

With these competitive metrics in hand, we were able to negotiate a one-month trial at a fairly low price. The trial pricing was based on a one-year commitment assuming the job board was able to hit a cost per applicant benchmark that its competitors were meeting.

As you probably guessed, the trial did not meet the expectations of either party. To this day, we’re able to source candidates in this marketplace through a group of competitive job boards and search strategies at an advertising cost of $3/candidate. The trial with the prospective vendor produced a cost of $15/candidate. Working this backwards, a job posting on this company’s job board priced at $300/month was really only worth $60/month for our application.

With this information (a metric that can be used across vendors, reliable data from a vendor’s competitors, and low-cost trial data from the new vendor), we were in a much better position to understand the true reality of the situation. In the subsequent negotiation, we were able to get this vendor to quickly reduce its prices by more than 50%. It still ended in an impasse because the vendor was not willing to lower its price enough to displace its competitors, but you do have to feel sorry for all the companies paying $300 per posting! With just a little more information and the confidence to ask, they could be paying $150 for the same advertisement.

If you apply this principle across the thousands of candidate advertising impressions we provide our clients on a daily basis, it adds up to some significant savings. Granted, it cost us money to define, develop systems, and track this data, but the numbers do pay off.

I hope you’ll find an application in your business where you can use metrics to save you money or find opportunities that you’re missing. It reminds me of the theme of one of my favorite Mary Chapin Carpenter songs, “The stars might lie, but the numbers never do.”

There’s Gold in Them There Metrics!

Tuesday, January 20, 2009

I wanted to follow-up on Dave’s discussion yesterday by demonstrating how the principle of measurement has worked in our business.

As many of you know, I’m the Managing Director of Tidemark. Tidemark is a recruitment process outsourcing company that specializes in sourcing large numbers of candidates for high volume hiring applications. In simple terms, we’re hired to help companies develop a consistent and predictable flow of candidates.

We use many different tools to accomplish this task for a company, and we find that each application needs customization to produce the best results. However, one tool we commonly use is the traditional job board.

There are more than 40,000 job boards on the internet today. The general business model for a job board is to charge a fee to “list” a job on their website. Successful job boards drive a lot of traffic to their sites, and the jobs on the high-traffic sites get viewed by more potential candidates. Theoretically, the price of a job posting on a particular site is related to the traffic a job board can garner. Higher traffic—higher cost per job.

But, reality does not always match the theory. In a business arena where it is difficult to measure and verify common metrics such as internet traffic, it is to our advantage to dig deeper. We advertise very specific jobs in very specific industries. We have an interest in what kind of traffic can be generated to our specific jobs. We also have an interest in knowing how many people viewing our jobs actually turn into applicants.

Although there are a number of other factors that cause results, we eventually boil down this process (from a job board perspective) to a single metric: “advertising cost per applicant.” With this metric we now have a negotiating platform that is based on solid data and reality—our reality.

Over time, we’ve been able to collect data from more than 20 metropolitan areas and track issues such as seasonality, changes in the job market in the industries where we source, and even revenue flowing into our client’s industries. But, everything still filters down to the “advertising cost per applicant” metric.

With this metric in hand, we’re able to cut through the sales and marketing rhetoric offered by a job board as a way to justifying pricing. We question the job board on a very specific issue: can the job board produce enough candidates to support the price that they are suggesting we pay? If their competitors can produce results at a certain “cost per applicant” for our application, doesn’t it make sense that this vendor should be able to meet the same metric? If they can’t meet this standard, they need to lower their prices to meet their competitors—that only makes sense.

In this process, we’re not trying to disparage the vendor; we’re just helping both sides to see the true value of the service for our unique application. Through this process, we’ve saved our clients tens of thousands of dollars in advertising expenses. Tomorrow, I’ll share a specific example of how a negotiation was done with a particular vendor. It will help clarify the concept if I run through an example.

Of course, most of you are not in the recruitment process outsourcing business, so what worked in our business will not directly apply to what you’re doing. But, don’t miss the principle:

Every business process has points of measurement that can be identified and then optimized.

What are the measurement points in your business? If nothing comes to mind, that’s a red flag! If you do have measurement points identified, are they the right ones? In some cases, metrics are overcome by events and need to be adjusted to match a new reality. It may be worth the time to take an inventory of one your business processes and see what can and needs to be measured.

6 Reasons Professionals Measure Performance

Monday, January 19, 2009

If you spend any time watching sports on a professional level, you’re keenly aware that the biggest difference between pro and recreational teams (outside of talent) is that they measure everything. And I do mean everything! Why? Professionals know that without measurement there is no way for them to assess and predict performance of a team or an individual.

Without exception, measuring systems exists in every sport. But let’s take baseball as an example. Here are some of the things baseball professionals measure:

On-Base Percentage (OBS): the number of times a player reaches base divided by total plate appearances.

Batting Average (BA): the number of hits a player gets divided by “at bats.”

Slugging Percentage (SLG): the number of total bases divided by “at bats.” This is a little more difficult to explain—there is a formula for this if you care to research it more.

Earned Run Average (ERA): approximately the number of runs allowed per nine innings.

Strikeouts Per Nine Innings (K/9i), Strikeouts per Walk (K/BB), Walks plus Hits per Innings Pitched (WHIP), Opponent On-Base plus Slugging Percentage (OOPS), etc.

Here is my favorite: SLOB (Slugging % x On-Base %). Or course this has a double meaning—it is said to also describe those who sit around and think about baseball statistics!

There are at least 90 commonly used statistics (and yes, they all have acronyms) in baseball. This may all sound a bit ridiculous, but exceptionally talented and deeply competitive baseball professionals enjoy this level of scrutiny. It compels them to practice, find patterns, find weaknesses and improve.

Here are the top 6 reasons that professionals depend upon measurement:

They can’t set goals without it.
They can’t measure progress without it.
They can’t forecast results without it.
They can’t compare performance without it.
They can’t assess changes and fix problems without it.
They certainly can’t beat the competition without it.

Let me ask you a question, and I encourage to answer honestly: Do you approach your work as a professional or as an amateur?

Professionals measure, and amateurs typically “fly by the seat of their pants.”

5 Things We Can Learn From Great Managers in Peru

Friday, January 16, 2009

Over the past year, I have had the pleasure of becoming friends with a group of people who have developed a large real estate construction and management company in Lima, Peru. What brought this to mind today was that they happen to be in-country this week.

I recently traveled to Peru myself as part of this project. On this trip, I was able to witness firsthand the spirit of work among the people there. More specifically, I was able to gain exposure to a group of companies that seemed to possess an unlimited sense of hope and rejuvenation.

The country of Peru has an interesting economic history. Like many Latin America countries in the ‘70s and ‘80s, it was plagued with numerous economic problems such as high inflation, narcotics trading, corruption, failed government initiatives, etc.

In the mid-‘90s, Peru underwent considerable free-market economic reforms that produced significant economic growth, spurred foreign investment, and brought inflation under control. For an economy that was once primarily based on agriculture and the mining of natural resources, a transition has occurred to where more than 70% of their GDP is now derived from the services.

For those people who grew up in Peru during very difficult and near hopeless economic conditions, the new economy is perceived as their best chance to accomplish something significant. During my time as a business professional, I have rarely witnessed as much talent voluntarily working long hours towards a mutual goal.

But, it went a little deeper. Many of these people saw their work as a way to tap the very best of who they are. Their management teams recognized this energy and made it part of their organizations.
Here are some specific things I noticed about their managers:

They expect their organizations to hire the best talent. They settle for nothing but the best.
They expect these talented people to set the bar high and be fully engaged in their work.
They measure everything and everyone. The managers made it clear that without reliable data you can’t set meaningful goals and assess daily progress.
They are constantly trying to discover what their clients want.
Most importantly, they have the courage to be constantly active. They don’t get stuck in inactivity, which many organizations and people tend to do.

I was inspired, and I wish that more organizations in our country could tap into these principles. While the financial results were impressive among these companies, the positive energy and passion is what caught my attention the most.