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Recommended Posts: Respect for People (Understanding Psychology) - Motivating Employees - - Stop Demotivating Employees - Excessive Executive Pay
Understanding Why Good Workers Quit
“Ask them directly: What can we do to keep you?,” urges Kaye. And don’t be shy or dishonest. If the employee asks for things you cannot deliver, be direct in acknowledging it but also indicate what you can do. Know, too, that just by talking to employees in this way you are scoring points because it’s something that just does not happen in most companies.
More concretely, Karen Fink, vice president of human resources for Edmunds.com, said that the glue her company uses to keep top IT workers is as simple as interesting work. “Technical workers tend to remain with an organization where they have the opportunity to contribute to interesting projects that stretch their skill sets and where they have the opportunity to be educated on the latest technologies.”
Good advice. I like direct, simple, questions. What can we do to keep you? What do you enjoy about your job? What do you dislike? What can I do to increase your joy in work? What one thing would you most like to see changed? What do you want to see continue? Would you like help in some aspect of your career development? What can I do better? Am I providing too much oversight, not enough?
Give honest straight forward answers to questions. If someone wants to move ahead and needs to work harder to advance their career tell them that. If they need to be more cooperative, develop certain skills… tell them. The idea is not just to make the person happy in that meeting. If they need to work on certain things to get where they want then help them do that. Give your best advice and say what they can do to improve.
Related: People are Our Most Important Asset - What 1 Thing Can We Improve? - IT Talent Shortage, or Management Failure? - Silicon Valley Style Hiring - How to Improve - Respect for People, Understanding Psychology - The Joy of Work
“You have to treat your employees like customers”
“There isn’t any customer satisfaction without employee satisfaction,” said Gordon Bethune, the former chief executive of Continental Airlines, and an old friend of Mr. Kelleher’s. “He recognized that good employee relations would affect the bottom line. He knew that having employees who wanted to do a good job would drive revenue and lower costs.
Well said. Related: Focus on Customers and Employees - Airline Quality - Respect for People - Curious Cat Management Improvement Dictionary
Sense of Fairness Affects Outlook, Decisions
If people cared only about absolute rewards, then Person B ought to accept whatever Person A offers, because getting even $1 is better than nothing. But experiments show that many people will reject the deal if they feel the first person is dividing the money unfairly.
Related: Obscene CEO Pay - Respect for People and Understanding Psychology - Why Pay Taxes or be Honest - The Illusion of Understanding - The Psychology of Too Much Choice
| Training new employees and then paying them to quit, sounds pretty bizarre; Zappos is not afraid of doing things differently. Why Zappos Pays New Employees to Quit - And You Should Too:
Zappos sells shoes—lots of them—over the Internet. The company expects to generate sales of more than $1 billion this year, up from just $70 million five years ago…
Zappos has also mastered the art of telephone service - a black hole for most Internet retailers. Zappos publishes its 1-800 number on every single page of the site - and its smart and entertaining call-center employees are free to do whatever it takes to make you happy. There are no scripts, no time limits on calls, no robotic behavior, and plenty of legendary stories about Zappos and its customers. This is a company that’s bursting with personality, to the point where a huge number of its 1,600 employees are power users of Twitter so that their friends, colleagues, and customers know what they’re up to at any moment in time. But here’s what’s really interesting. It’s a hard job, answering phones and talking to customers for hours at a time. So when Zappos hires new employees, it provides a four-week training period that immerses them in the company’s strategy, culture, and obsession with customers. People get paid their full salary during this period. |
About 10% of employees take them up on the offer.
Do any of you readers want to convince Zappo’s to buy a couple airlines (Jet Blue and Southwest don’t seem to go where I need to go, too often) a cell phone company, an internet service provider and a credit card company? I could appreciate the good service in those areas 
If I were them I would start with the credit card company - I really don’t understand why someone doesn’t provide good service in that area - with the huge profits it provides and competitors that treat customers like rubes to be fleeced. Airlines you have to be crazy to buy (so don’t try to convince them of that one first).
My friend, Sean Stickle, went to work for custom ink a few months ago. I don’t think they offer to pay new employees to leave but they are devoted to customer service and to not just saying customer service is important but focusing attention on delivering it. They publish “Uncensored Customer Reviews” on their home page. There are some companies that really do value customer service even while most companies do everything they can to provide horrible service.
Related: Respect for People - Understanding Psychology - Starbucks: Respect for Workers and Health Care - Company Culture - Enhancing Passion in Employees - Respect for Workers - Mistreated Customers Let the World Wide Web Know
David Heinemeier Hansson Talk at Startup School 2008 (Paul Graham’s Y-combinator school). It is helpful to appreciate the importance of some simple ideas. Working on web focused businesses people often get carried away with the huge potential and sometimes lose touch with reality. While the ideas are more obvious when looking at web related business their is plenty here for many companies (the second half might be more helpful for many).
In this talk David does a great job of explaining how 37 signals has chosen to work. They are not concerned with becoming large. They focus on doing what they want to do - creating great software solutions (see: Systemic Workplace Experiments). And on making money to allow them to stay in business.
Some tidbits of advice: create great applications, charge people money, make a profit. Yes to those outside the web world this might seem obvious… He discusses a very similar idea to the idea of 1,000 true fans. He mentions to bring in a $1 million, all you need is 2,000 customers paying $40/month. 37 Signals has done well focusing on small business. Don’t be in such a hurry.
Related: Why is 37signals so arrogant? - Complicating Simplicity - Joy in Software Development - Great Marissa Mayer Webcast on Google Innovation
Well, this doesn’t sound very well thought out. Bonuses often distort behavior. Dr. Deming was not against such targets and bonuses because he thought they would not result in bugs being fixed: Dr. Deming on the problems with targets or goals. It is a question of how that will happen. The system being distorted is the most likely result of any such system.
Everyone worked even harder on the third day. On the fourth day, however, the well had started to dry up. The testers ran, re-ran, and re-ran again the test cases, but they could only find a handful of issues. The developers strained the issue-tracking system, constantly reloading the “unassigned bugs” page and rushing to self-assign anything that appeared.
And then something strange happened at lunch. Instead of going out to eat with his usual teammates, one of the developers went out with a tester. Soon after, another developer went out with another tester. Within a few minutes, almost all of the developers had paired up with testers.
As the developers returned from lunch, they immediately got to work. Instead of scavenging for newly found bugs, they worked on “code refactoring” and new functionality. And as soon as they deployed their changes, testers found bugs — minor, obscure bugs that a developer could easily overlook. And just as quickly as testers found bugs, the developers were able to fix them and re-deploy. By the end of the day, developers and testers had earned an average of $120.
Kiva provides loans through partners (operating in the countries) to the entrepreneurs. Those partners do charge the entrepreneurs interest (to fund the operations of the lending partner). Kiva pays the principle back to you but does not pay interest. And if the entrepreneur defaults then you do not get your capital paid back (in other words you lose the money you loaned).
They do an excellent job of using the internet to allow people like me to feel connected to people we can help. And in so doing, they do an excellent job of implementing their strategy (providing funds for micro-loans) to achieve their goal (to alleviate poverty). “Kiva’s mission is to connect people through lending for the sake of alleviating poverty.”
Today I added $450 to my loan portfolio with Kiva and donated another $100 to Kiva. I added 5 loans in: Tanzania (2 loans), Uganda, Paraguay and Ecuador.
I am happy with the success of the Curious Cat blogs but I do have one item I wish would improve. I wish more Curious Cat readers would take advantage of Kiva. If you lend through Kiva, please add a comment with a link to your Kiva page and I will add you to our list of Curious Cat Kiva Contributors.
The Kiva web site includes all sorts of data on the partners making the loans (the capital at risk is provided by Kiva donors but a local organization services the loans…). For example, see the profile for Tujijenge Tanzania Ltd. This shows for example the Amount Repaid Vs Expected Rate (100% for this partner - no defaults or delinquency). The rates for all Kiva loans are 3.75% delinquent and .12% defaulted. They also show the Average Interest Rate Borrower Pays To Kiva Field Partner (which is 24% in this example) and the Average Local Money Lender Interest Rate (which is 60%).
One of things I really hope to see is some research on the results Kiva is producing. What kind of changes are these loans bringing about: specifically looking at Kiva. And also looking at various factors such as the interest rate and whether targeting my lending to those with lower average rates results in greater benefit. There is a great deal of unknown and unknowable numbers involved but some data would be interesting as well as analysis even without numbers of results.
Related: Using Capitalism to Make the World Better - Frontline Explores Kiva in Uganda - Providing a Helping Hand via Kiva - Expanding Credit Access: Using Randomized Supply Decisions to Estimate the Impacts - Microfinance research links
Three Amazing PHP/MySQL/Perl Developers Now Available - Posting on Craigslist. The url will expire so I included everything but the contact info below (follow the link for contact info).
Yesterday I had to do one of the more difficult things — lay off three of my good friends, all of whom are talented and professional developers.
I’m posting here today in hopes that someone out in the world is looking for some seasoned talent, people who can get things done for you. I will personally recommend all three of these guys, and I’ll detail below each of them. If you are interested, I’m including my phone number. I’ll take your contact information and give it to the person(s) you are interested in, and you can take it from there.
Here goes.
Developer #1
I’ve worked with Developer #1 since 2005. He’s worked for Fortune 500 companies and small startups. His strengths are conceptualizing and implementing complex systems using PHP and MySQL. These systems are not limited to the web, however the web is where most of his work has been for the last few years. During his employment with me, he:
* Designed a complex billing system, complete with audit trails
* Developed a site-wide internationalization system, allowing us to easily translate any phrase on the system to a different language
* Designed and successfully implemented several difficult projects based on half-way decent specifications documents (my fault)
Related: People are Our Most Important Asset - Bad Management Results in Layoffs - Hiring the Right People - Severance Plans to Respect People - Curious Cat Management Improvement Jobs
(more…)
WaMu: Skip customers; save the execs
The board decided in February to use different performance yardsticks that could make it look like Killinger and other top executives were doing great jobs — and all but ensure them millions of dollars in bonuses for 2008. Those huge losses piling up because of subprime loans and foreclosures? At bonus time, the bank will ignore them.
The behavior of executives that take what they have no right to in unjustifiable pay schemes continues to be a disgrace. Thankfully more people are shedding light on the unconscionable behavior. Excessive executive pay is both a sign of awful ethics and a driver of bad management action. I add two new diseases of western management to Dr. Deming’s 7 deadly diseases; massively overpaid executives is one.
Related: Tilting at Ludicrous CEO Pay - Obscene CEO Pay - “Too often, executive compensation in the U.S. is ridiculously out of line with performance” Warren Buffett
Part of the deal is that if 37signals helps you pay, you have to share what you’ve learned with everyone. Not just everyone at 37signals, but everyone who reads our blog. So expect to see some blog posts about these experiences.
…
We just ask people to be reasonable with their spending. If there’s a problem, we’ll let the person know. We’d rather trust people to make reasonable spending decisions than assume people will abuse the privilege by default.
Dr. Deming proposed supporting education of any type for employees (point 13 in the 14 points). That is not often done, but 37 signals is not alone in doing this. Great stuff. Create a great environment for people to work in and you can get great things done. Also good old PDSA at work - try things on a small scale and then institute those experiments that succeed on a wider scale.
Related: Google Experiments Quickly and Often - Vacation: Systems Thinking - Getting and Keeping Great Employees - Joy in Work - Complicating Simplicity - Workplace Management
Yahoo’s Severance Plans a Defense Against Microsoft?
The severance packages would extend regular compensation for a period of four months to two years, depending on the employee’s job level. Employees would also receive continued health benefits, financial assistance for finding a new job (up to $15,000) and accelerated vesting of stock options. The move comes as reports are circulating that Microsoft will go hostile in its acquisition bid, waging a proxy battle to replace Yahoo’s board rather than raise its offer.
Interesting. Yahoo is does seem to be losing staff so there is a business reason (even for those that don’t think the way I do about benefiting all stakeholders). It also seems to fit with respect for people to me. I actually am leaning toward thinking this is something lean/Deming companies should adopt to show that the company does not support treating employees as costs to be reduced. I could see those that see companies more like balance sheets than system would object to implementing a new idea that makes MBA style layoffs more difficult. I am fine with that. I’m sure Yahoo! is actually driven partially by the poison pill feature of such a plan (which isn’t the greatest place to start but I can live with that). I haven’t thought this through completely but I like it now.
Related: People are Our Most Important Asset - Getting and Keeping Great Employees - Hiring: Silicon Valley Style - Tilting at Ludicrous CEO Pay - Curious Cat Management Job Board
I like to continue to push for some things that might not seem achievable to many. It is too easy to accept that things have to stay the way they are. Several of Dr. Deming’s list of Seven Deadly Management Diseases are now accepted as serious problems by most. Performance appraisal is a strange disease: most people agree performance appraisals are not effective and indeed are harmful. Yet, most still don’t think anything can be done about it. But we can, and should, take steps to improve. Just don’t do it.
Managers are from Mars, Performance Appraisals from Venus discusses Mary Poppendieck’s recent presentation - Appraisals and Compensation: The Elephant in the Room
Mary went over the false assumptions behind individual pay-for-performance (money, motivation, individual assessment), and the negative effects they have on the system.
She finished by a case study done by HP across 13 organizations over a year 4 year period where each division implemented a different type of incentive plan. The results are just mind boggling. They all failed and got canceled.
I strongly suggest chapter 9 (Performance Without Appraisal) of The Leader’s Handbook, by Peter Scholtes, for those thinking about this topic.
Related: Righter Performance Appraisal - Problems Caused by Performance Appraisal - Performance Without Appraisal - Find the Root Cause Instead of the Person to Blame
Appraisals are a waste of Time
The poll of nearly 3,000 workers also found a quarter who had had an appraisal suspected their managers simply saw the annual review as a “tick-box” exercise. And a fifth complained managers rarely prepared for the meeting in advance – a key bit of advice you’ll always get in appraisal training – and did not even think about it until they were actually sat down in the room.
That is just a start on the problems with annual rating of people. On page 101 of Out of the Crisis Dr. W. Edwards Deming states the following as one of the seven deadly diseases:
Related: Dr. Deming on performance appraisal - Continuous, Constructive Feedback - Performance without Appraisal - Righter Performance Appraisal - The Leader’s Handbook
I am not convinced of the premise of The new war for talent: that there will be a great shortage of talent soon. But the article makes some interesting points.
I think the main thing to do is to respect employees (and have that visible in the management decisions made in the organization). Stopping the demotivation would be a big step for many organizations. And to manage your organization with the understanding that the organization’s purpose should be to benefit the various stakeholders (shareholders, customer… and employees).
Related: People are Our Most Important Asset - How to Improve - What is Wrong with MBA’s - soul crushing work (comic)
Procedurally Enforcing Workflow by Michael Salamon:
You can’t force people to follow directions they deem arbitrary.
I bet if that gate spit out $100 bills people would use it.
Why matters. You can’t just expect people to act in a way that seems arbitrary. As I stated in Poka-Yoke Assembly, Do you Read Instructions Carefully Before Assembly? Nope, I don’t. I expect I can make a quick judgment if I really need to or I basically get it and can put things together well enough. I expect the supplier to make very obvious anything critical. It is not ok to expect people to think the way you want them to. You have to understand how people will react and create solutions based on that.
We have discussed similar ideas: Why Isn’t Work Standard? - Visual Work Instructions - Visual Instructions Example - European Blackout: Human Error-Not - Find the Root Cause Instead of the Person to Blame
A similar example I learned long ago. Many schools try to force students not to walk on the lawn and create ugly paths through the grass. A smart alternative. Wait for the students to wear a path. Then pave that. If you are frustrated because people won’t follow your rules your rules are probably bad. Fix the rules (or procedures…). Don’t expect telling people in a loud voice (or stern memo or…) that they must follow your rules.
What can we do to enhance passion amongst employees?
Some think you need to pay people more. If tomorrow you doubled everyone’s pay they are excited for a short time a few months later everything is the same on the passion front (it would lesson turnover as people stay for the extra money compared to what they would get elsewhere).
Douglas McGregor explained, in the Human Side of Enterprise, nearly 50 years ago, the theory x and theory y styles of management.
Theory x believes you need to get people to work by tricking them, threatening them, motivating them, etc. Theory y believes they want to work and managers need to eliminate the de-motivation that is in place in many organizations. Dilbert makes fun of quite of a few of the stupid management practices that sap passion from people.
What you need to do is eliminate de-motivation, not to try to enhance passion directly.
Also, as Guy Kawasaki’s makes a good point when he says “the key to getting great people to work for you is to have a great product. That is why Google does so well. That is why Apple does so well.” This can help. Being a part of something great gives many people passion.
Related: Why Extrinsic Motivation Fails - Motivation - Don’t ask employees to be passionate about the company!
My comments on: No Problem Without a Solution
“Having no problems is the biggest problem of all.” - Taiichi Ohno
I understand that most managers feel that their employees should not bring them problems. Instead, expressed in the most positive way, employees should fix things or bring possible improvements. However, I think that is poor management.
I understand there may well be more detail than you provide that adds a more sensible (but more complex) reaction that stated in your post about your situation. However, there are many example, of bosses that expect their people not to bring them “bad news” not to bring them “problems” and that attitude is exactly wrong in my opinion.
What they are saying is: if you know of a problem but don’t know of a solution I would rather have my company continue to have that problem than admit some of my staff don’t know how to fix it (and then have to deal with it myself - maybe then having to accept responsibility for results instead of just blaming you if I am never told and there is a problem later…). I think that is setting exactly the wrong tone to set.
Employees should fix things. They should bring solutions to managers to improve things that might be out of their ability to fix. But if they know of a problem and not a solution and a manager tells the employee they don’t want to be brought problems then I don’t want that manager.
If an employee never learns how to find possible solutions themselves that is not a good sign. But it is much, much better to bring problems to managements attention than to fail to do so because they know the manager thinks that doing so is weak. It is the attitude that problems are not to be shared that is weak, in my opinion.
Related: Management Training Program - European Blackout: Human Error or System Error - How to Improve - Respect for People (Understanding Psychology) - Don’t Empower
In Loyal Employees Stay Home, quotes from the Wall Street Journal (behind a iron curtain still in this day and age - oh well):
I agree with the sentiment expressed here. And I speak from personal experience that it does make a big difference to me. I have trouble getting some of my work done in the interruption prone office. Working at home allows me some time to concentrate and focus with fewer interruptions (and ones easier to ignore if I really need to focus). If you wanted to hire me (given what I would be doing) and didn’t offer telecommuting options the odds of hiring me are not good.
Related: Five Pragmatic Practices - The Siren Song of Multitasking - Curious Cat Management Improvement Jobs - performance appraisal posts
We’re Not Finnished With You Yet
This is becoming the reality nearly everywhere. The best hope is that companies learn respect for employees and want to keep employees because they truly value them. But failing that watch what happens over the next couple of decades as demographic trends mean that companies have little choice but listen to the desires of older workers.
Finland, Japan and a few others may lead the way but the western industrialized world is quickly aging. It seems pretty straight forward that the aging workforce is going to be needed. And companies are going to have to adapt (that is my prediction anyway). I have always thought it is crazy that we work full time and then stop all together. It makes much more sense to me for there to be a gradual easing of the workload. The biggest complication I think is companies that don’t want to be flexible. I think that desire to be inflexible will be overwhelmed by the demographics. There is also an issue of psychology - people don’t like to earn less.
I have a feeling that it may well be necessary for most to earn less at 70 than at 40 (many just can’t produce the same value they once could). There are some additional benefits that experience will bring but how everything balances out will decide what is justified. This will play out in the marketplace, but I think in addition to companies not comprising to make part time jobs work many employees insist on maintaining salaries - which might not be reasonable. I am happy to have the marketplace make the decision on salaries.
Another part of the reason this seems likely to me is people just don’t save what they need to in order to retire - so many need to keep working (as companies will need experienced workers).
Related: Saving for Retirement - Working Longer - Our Only Hope: Retiring Later
The Siren Song of Multitasking
Writes Mark, “This suggests a fairly high cognitive cost to resume work, as people are distracted by multiple other topics, and sometimes even nested interruptions. Our informants report that this can result in redundant work as they reorient.” Mark acknowledges that interruptions are often relevant to the work at hand, but notes that “reorientation” to the task comes at a cognitive cost. A report from Basex quantified the cost of interruptions. It found that the average knowledge worker loses 2.1 hours per day to “unimportant interruptions or distractions.”
Quite simply, people need the mental and physical space to think. In fact, the number-one predictor of job performance and satisfaction is the ability to concentrate in one’s own workplace. While work environments that include places for quiet, uninterrupted work as well as collaborative work can help a worker fight the urge to multitask, a worker’s ability to concentrate comes in part from being determined to concentrate.
via: The “multitasking” delusion
Related: Five Pragmatic Practices - Curious Cat management articles - Why Projects Take so Long - psychology related management posts
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