Who to Hire, Part 2

In my March 22 blog I made the case that in today’s nanosecond knowledge economy, companies need to hire for overall talent, not just for basic skills and experiences. But operationalizing this nebulous term “talent” (not to mention “overall talent”) is difficult. In my last book, The Leadership Secrets of Colin Powell, I believe I documented the best practical definition of this term.

When Powell was still an officer in the military, he made a very insightful comment about the kind of people to hire--the people who are likely to be your great performers, the people who are likely to act as leaders regardless of their rank or function, the people who one day might well be running the show. In my book I called it “Powell’s Rules for Picking People”. Here’s what he said:

“Look for intelligence and judgment and, most critically, a capacity to anticipate, to see around corners. Also look for loyalty, integrity, a high energy drive, a balanced ego and the drive to get things done.”

Nicely said. Clean. Sparse. And accurate. Consider the elements:

 “Intelligence and judgment”. Note the juxtaposition of terms. Intelligent, but not in a vacuum. Intelligent, as in—sharp and savvy enough to analyze quickly, learn fast, and then make clear practical judgments.
 “Capacity to anticipate, to see around corners.” Able to look ahead, to make sense of trends and fleeting opportunities in the distance; willingness to prepare for tomorrow's realities while addressing today’s. In a world where change is constant, I'm not surprised that Powell rates these attributes as the most critical.
 “Loyalty and integrity.” Once again, a great juxtaposition of terms. Loyalty is not about blind conformity or obedience. Speak your mind. Argue. But once a decision is made, “loyalty and integrity” is about someone who others know they can count on. Someone who’ll walk the talk. Someone who can be trusted after he or she leaves the room.
 “High energy drive.” Enthused, passionate, “up”, willing to persist.
 “Balanced ego”. A strong ego, yes--necessary for self-confidence, for galvanizing others to action, for overcoming hurdles, for pushing back against resistance and negativity, for taking risks. Egocentric or egomaniac—as in self-absorption, self-aggrandizement, and “me as #1”—no. To balance a strong ego with a sense of humility is the essence of balance.
 “Drive to get things done.” Goal-oriented, performance-driven, merit-conscious; being willing to learn new things, to try new things, and to venture into risky territory in order to achieve a mission.

In an earlier article on Powell’s Rules for Picking People, I wrote:

How often do our recruitment and hiring processes tap into these attributes? More often than not, we ignore them in favor of length of resume, degrees and prior titles…..You can train a bright, willing novice in the fundamentals of your business fairly readily, but it’s a lot harder to train someone to have integrity, judgment, energy, balance and the drive to get things done. Good leaders stack the deck in their favor right in the recruitment phase.

Next week I’ll talk about the final element in this mix: the “fit” between talented people and the organization they work in.

Who To Hire, Part 1

Years ago when I was in graduate school, I took an industrial psychology course that emphasized that both legally and psychometrically, the best way to hire people for jobs was to figure out “can they do the job?” That meant figuring out “A”, the specific components of the job (the job description, the tasks, the expectations, the performance goals); then “B”, figuring out the skills, competencies and attributes necessary to match the needs of the job; and then, finally, “C”, testing for those skills and attributes, and ultimately selecting that applicant whose profile best fit “A” and “B”.

This process sounds logical—and it’s certainly legal—but I believe that nowadays it’s at best a lukewarm predictor of success . The basic skills which are defined as necessary “to do the job” are usually lowest-common denominator skills. They describe the mechanics of the job, the minimum expectations necessary to carry out the demands of the job. But success in work today is also due to imagination, initiative, persistence, caring, risk, courage, collaboration, trustworthiness, and personal responsibility. Obviously, the higher one is in the hierarchy, the more important these attributes become. But in today’s Knowledge Economy, they’re important regardless of rank or function. They need to be addressed and prioritized in the recruiting process, because they help answer the question “can he or she do the job successfully?”

I frequently cross one of the three major bridges around San Francisco. Some of the toll takers are indifferent, some verge on rudeness. Don’t tell me they “can do the job”. No, they aren’t doing the job, because the mechanical part of taking peoples’ money and giving change is only part of the job. They need to be pleasant and helpful too. That’s called customer service. That’s part of doing the job well. I wouldn’t hire anyone for that job unless I was convinced that he or she would make the customer’s experience a good one. And in fact, I wouldn’t hire someone for that job unless I thought they would take initiatives in helping improve operational efficiencies too. That’s called doing the job very well. (And if I was really smart I’d pay more for good people rather than expecting them to be good at the same pay that bad ones get). Extrapolating to management, I would rank the evidence of those factors I listed above—imagination, initiative, etc.—much higher than factors like where the applicant got his degree, or how many years’ experience she has, or can they do the fundamentals of the job description. We need to hire for overall talent, not just for basic skills and experiences. More next week.

When PowerPoint Becomes a Cultural Disease

This last rainy Sunday, I leafed through Fortune magazine’s 2006 “100 Best Companies to Work For” issue. Since Genentech is prominently featured in my upcoming book, I was especially interested to note that the company was rated #1—the best company to work for.

The Fortune article did a nice job in describing the vibrant, “flout conventional wisdom” culture of the company, but one statement of CEO Arthur Levinson caught my eye. It’s about PowerPoint, which on the surface has nothing to do with culture but in reality has everything to do with it.

I’m all in favor of PowerPoint—I use it myself in corporate presentations. But PowerPoint can be used to camouflage as well as enlighten. We’ve all sat through PowerPoint presentations which are so tediously glutted in obscure data and so humdrum in gobbledygook that they deflate our capacity to think critically. Or alternatively, they are so technologically “gee-whiz” eye-popping that they distract us from the business at hand. These types of presentations are often symptomatic of a culture where obscure communication trumps clarity, or where style trumps substance.

I suspect Levinson would agree. In a December 2005 e-mail to senior managers, he bemoaned “…the spread of unintelligible, gibberish-laden PowerPoint presentations…I have recently sat through several presentations that were simply incomprehensible—mind-numbing, bloated discourses that were full of buzzwords and otherwise devoid of meaningful content. This is a serious problem, and the worst part is that it’s spreading like the disease it is.”

Genentech knows physical disease, and Levinson knows cultural disease. What’s it like in your company? When PowerPoint obscures rather than enlightens, when it sucks out peoples’ energy rather than excites them with compelling information, when it’s more of a show than a force for problem-solving, and when engineers, marketers, department managers, and such are as personally preoccupied in preparing PowerPoint slides as they are in candidly confronting tough problems—then the organization is deep in a cultural morass. I’m not exaggerating. Apparently, neither is Levinson. Clear communication is the glue that holds your organization together. Nip the PowerPoint disease in the bud.

One more thing. Calling in a consultant might aggravate the problem, according to Levinson. Consultants, in his view, do more “corporatespeak” than anyone. Come to think of it, they do more PowerPoint too.

New AT&T, Old AT&T

So after devouring a series of other companies, SBC ate its rapidly deteriorating parent AT&T last year, and then took over its name. Now, as the new AT&T, the company is poised to buy BellSouth for $67 billion. I’m sure this won’t be the last big deal we read about, because CEO Ed Whitacre's “M.O.” is pretty clear:

• Grow via serial acquisition
• Pay premium prices for prey
• Aim to be a one-stop-shopping telecommunications mecca

Consumer advocates are worried about this deal. They think that it will diminish competition. I think they are worrying needlessly, because I think that ultimately, the new AT&T will implode the same way the old one did. The reasons go right to the heart of Whitacre's strategic biases:

• Growth via serial acquisitions is a prescription for a slow-motion collapsing house of cards (think MCI, Tyco, Vivendi, and Cendant, for starters). If you’re relying primarily on acquisitions, you’re conceding that you don’t really have an exciting value proposition and you don’t have enough cool compelling stuff in the pipeline to grow organically. Investors aren’t fooled. They’re already dinging AT&T.
• Paying top prices is one of the most egregious and common reasons for merger distress. Executives become so enamored of a prospective deal that they overpay, sometimes insanely. Whitacre pays whatever it takes. As of March 6, AT&T’s offer was $35 a share, which is so far above the real worth of BellSouth ($28 a share) that a Sanford Bernstein analyst concluded that AT&T is basically giving away the value of any potential synergies to Bell shareholders.
• The one stop shopping merger fantasy has seriously wounded many high-profile acquirers (think HP under Fiorina, or Schwab, or AOLTimeWarner, for starters). Customers don’t cooperate with the plan (they shop around). New technologies don’t cooperate (they “obsolete” the old acquired ones). New competitors—aggressive fast-growth niche players-- don’t cooperate, either (they do select things better and faster and usually cheaper).

So AT&T’s acquisitions make good copy. Newspapers love them. But at the end of the day, what will AT&T look like? A huge, unwieldy, costly, creaky, one-stop-shopping bureaucracy glutted with mini-empires offering a slew of “me-too”, commoditized, often-mediocre products and services. Hmm, doesn't that sound like the old AT&T?