There’s a company which has outperformed others consistently for years, through good economic times and bad. Not only has the company itself done extremely well, but as I looked into some of its departments I found the same “outperformance” gracing most of its functions, even the corporate service ones such as IT, finance or HR.
Unlike most other firms, this company never stops interviewing potential additions to the staff.
They do not wait for an opening before looking for talent — they are always looking for talent.
Their goal, one that managers are acculturated to fulfil, is to continuously hire people that are better than the ones they have. (In this organization “better” is a complex judgement: it is not simply about educational qualifications, experience or demonstrated excellence, but also about how well the newcomer will “fit” with the people already there, and how flexible they are likely to be.)
The company only looks to create a position when a suitable candidate is found. When they have someone worth hiring, they bring them in.
As with most companies, there is a probationary period in which the person can be let go if it is not working out. Unlike most companies, they do not worry about “headcount” when they hire, nor do they worry about budget: HR holds a common spending account used to pay for “finds” during their probationary period.
The bringing in of someone who improves the organization offers managers the opportunity to consider other moves.
Is someone ready for more responsibility — in need of a new challenge to spark them and their latent potential — or in need of a performance improvement plan (and exit if there is no improvement)? Now, during the new hire’s probationary period, is the time to organize and execute on these changes, since there is no loss involved.
At the same time, the decision can be made as to whether to ask for a permanent expansion, a time-limited one, or to transfer someone out of the group (or terminate a poor performer) to make room for the new employee. During downturns there is less likelihood of expansion, but at any time the decision structure is the same.
This approach to talent — to constantly be looking for it — means that, in most cases, this company has first crack at anyone of superior skill who comes on the market.
The constant upgrading of groups also keeps existing staff growing in their jobs, and the steady addition of new blood gives the firm a steady flow of new ideas based on others’ experience.
Enterprises that are peers to this company inevitably point to the extra cost such an approach entails. Oddly enough, most of those who point to the so-called profligacy of spending about 3-5% of the labour budget in transitional expenses fail to comment on the 2-3x increased performance in the company’s results.
I’ve come away thinking this is an investment any company could make to start turning its performance around — the payback is likely to be more dramatic in tougher times than in better economic times.
Will you get your company’s share of top talent, or will you let your competitors grab it from you?