Category Archives: Leadership

What do you value most? Time or Money?

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If I work less, you will pay less. True?

I’m assuming your answer to the question, what do you value most, time, or money? Your answer was time. Given enough time I can make more money. No matter how much money I have, I can’t necessarily buy more time.

So, if I do my work faster for you, that should have a higher value, right?

You see, it doesn’t work both ways. We want our employees to be more efficient doing world-class work, but if they don’t work the amount of time we expect, “we” feel like we got cheated. But, wait, I did what you wanted in half the time, you should be happy to pay me, in fact, you should want to pay me more!

Let me give you a real example.

Let’s say you’re paying me to find you a world-class employee, that will be super valuable to your organization. I’m billing you 25% of this employee’s first year’s salary of $100,000 if I successfully find you this talented person.

Turns out, I was able to find this person in 5 minutes. You owe me $25,000.

I’m so happy I was able to find you the person you wanted to hire! We are both extremely happy!

But you are not! Are you?

Why?

You feel cheated. You feel like if it only took me 5 minutes to find this person, that can’t be worth $25,000.

So, let’s break this down:

  • You said time is your most valuable resource.
  • I just gave you weeks, maybe months of time, since this search only took 5 minutes.
  • In fact, getting this hire on so quickly will allow your organization to close millions in additional project work.

Do you still feel cheated that I did my job so well, it gave us both more time and more value to both of our organizations?  Yes, most likely…

Great leaders would be extremely satisfied with this outcome. Average and emerging leaders would accept it, but still have some slight heartburn (how will I explain this to my executives? I’m paying $25K for 5 minutes of work!). Awful leaders will fight not to pay the invoice and ruin the relationship.

Now all of this has nothing to do with staffing, that was just the example. It has to do with what we value more. Time or Money.

We fail as organizations when we can’t define what is most valuable. This is how we get leaders who still value “asses in seats” over people delivering great work quickly. World-class organizations set great deliverables, reachable goals, and reward employees for meeting those goals on time, or ideally sooner!

The reward employees get is time and flexibility. The reward the organization gets is employees who want to continue to blow goals out of the water.

What do you value more, time, or money?

Politically Incorrect Post of the Week: Pay Inequality Persists!

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Pay inequality persists? Well, that’s not politically incorrect!

What if I told you, gender wage gaps persist even in markets where workplace discrimination is impossible or unlikely?!

Whatcha you talkin about, Tim!?

Female Uber Drivers make 7% less than male drivers, even though, none of us even know if a male or female driver will pick us up. The algorithm specifically doesn’t allow us to request or know. So, how can Uber Drivers have a gender pay inequality issue?

Okay, so here’s where this might become a bit politically incorrect for those who want to make it that and ignore facts. Turns out, Men, more than women, drive faster, so they will make more on average driving for Uber than women. Also, Men are more likely to on request for rides in more congested, riskier areas, which tend to carry higher fares.

You can call it pay inequality. Some will call it a performance difference, in this particular position, in this particular profession.

One more example, Amazon’s Mechanical Turk, a gig worker site, which also only measures users performance and does not measure gender, also shows gender pay inequality across it’s users to the tune of 10.5%! Amazon’s Mechanical Turk pays men 10.5% more than women for the same work, even though they have no idea the person doing the work is a man, woman, non-binary gender, etc.

So, what gives!? Again, it comes back to performance. Researchers found:

“For 22,271 Mechanical Turk workers who participated in nearly 5 million tasks, we analyze hourly earnings by gender, controlling for key covariates which have been shown previously to lead to differential pay for men and women. On average, women’s hourly earnings were 10.5% lower than men’s. Several factors contributed to the gender pay gap, including the tendency for women to select tasks that have a lower advertised hourly pay. This study provides evidence that gender pay gaps can arise despite the absence of overt discrimination, labor segregation, and inflexible work arrangements, even after experience, education, and other human capital factors are controlled for. Findings highlight the need to examine other possible causes of the gender pay gap.”

Okay, don’t shoot the messenger! I’m only reporting the news!

Funny thing is, the authors (both male and female) of this Northwestern University study also were very concerned about people thinking they were being politically incorrect, actually making a plea within the published paper telling people they weren’t being politically incorrect!

Here’s the problem with all of this. Men can and will do certain jobs, on average, better than women. Women can and will do certain jobs, on average, better than men. I haven’t seen a study on non-binary genders, yet, but I can guess that Non-binary genders can and will do certain jobs, on average, better than both men and women!

This is why we have to be very careful when looking at gender pay inequality data at a macro-level. Of course, we have gender pay issues. But throwing out macro numbers does not help solve the problem. As leaders and HR professionals it’s our job to find the specific pay issues we have and correct those.

We love to believe, especially in our overly charged social climate we are in currently, that there are always bad actors at play when things like this happen. That’s not always the case, and we (the collective we) lose credibility when we make things like gender pay inequality a macro issue to leaders and executives who don’t have those issues or have them in very narrow categories which they were unaware.

Let’s find the inequalities. Let’s discover the reason for these inequalities. Then, let’s make things right that need to be made right. Right now, we have a lot of righting to do, but my hope is that won’t always be the case. So, assume positive intent, first, and let’s make our world better for everyone.

If you had to redo your corporate mission statement in 2020, would it change?

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I think we call agree that 2020 has been a sh*tshow, but there also have been some very important issues that have taken a spotlight that probably would have a major impact on our corporate mission and vision statements. Besides the social justice conversation, the political division continues to grow, and of course workplace health and wellness kind of continues to suck up the oxygen in the room!

Coinbase, a technology company that created a platform to buy and trade cryptocurrency, decided to redo their corporate mission statement, primarily because political division and social justice ideas, being discussed in the workplace, were kind of disrupting their culture and not in a positive way.

Here are some of the aspects of the new Coinbase mission statement:

Play like a championship team –

  • Be company first: We act as #OneCoinbase, putting the company’s goals ahead of any particular team or individual goals.
  • Act in service of the greater mission: We have united as a team to try and accomplish something that none of us could have done on our own.
  • Default to trust: We assume positive intent amongst our teammates, and assume ignorance over malice. We have each other’s backs.
  • Focus on what unites us, not what divides us: We help create a sense of cohesion and unity, by focusing on what we have in common, not where we disagree, especially when it’s unrelated to our work.
  • Sustained high performance: As compared to a family, where everyone is included regardless of performance, a championship team makes a concerted effort to raise the bar on talent, including changing out team members when needed.

Focus on building –

We focus on the things that help us achieve our mission:

  • Build great products: The vast majority of the impact we have will be from the products we create, which are used by millions of people.
  • Source amazing talent: We create job opportunities for top people, including those from underrepresented backgrounds who don’t have equal access to opportunities, with things like diverse slates (Rooney rule) on senior hires, and casting a wide net to find top talent.
  • Fair talent practices: We work to reduce unconscious bias in interviews, using things like structured interviews, and ensure fair practices in how we pay and promote. We have a pay for performance culture, which means that your rewards and promotions are linked to your overall contribution to the mission and company goals.
  • Enable belonging for everyone: We work to create an environment where everyone is welcome and can do their best work, regardless of background, sexual orientation, race, gender, age, etc.

We focus minimally on causes not directly related to the mission:

  • Policy decisions: If there is a bill introduced around crypto, we may engage here, but we normally wouldn’t engage in policy decisions around healthcare or education for example.
  • Non-profit work: We will do some work here with our Pledge 1% program and GiveCrypto.org, but this is about 1% of our efforts. We are a for-profit business. When we make profit, we can use that to hire more great people, and build even more. We shouldn’t ever shy away from making profit, because with more resources we can have a greater impact on the world.
  • Broader societal issues: We don’t engage here when issues are unrelated to our core mission, because we believe impact only comes with focus.
  • Political causes: We don’t advocate for any particular causes or candidates internally that are unrelated to our mission, because it is a distraction from our mission. Even if we all agree something is a problem, we may not all agree on the solution.

The reason is that while I think these efforts are well-intentioned, they have the potential to destroy a lot of value at most companies, both by being a distraction and by creating internal division. 

I appreciate that Coinbase CEO, Brian Armstrong, is working to try and protect the corporate culture that Coinbase had prior to all the issues that have taken center stage in 2020. I think most leadership teams probably feel the same way, “Can’t we just have it like it was before!?” Wasn’t that better?

Well, it probably was better for the leaders and a good number of employees, but it also wasn’t good for a bunch of others. Many of these conversations were needed, and our hope is this will lead to even a better, stronger culture moving forward. I’m not naive, though, some of this will destroy some companies. It’s never all good or all bad.

I actually like the focus on work, when you are at work. It’s a very GenX/Baby Boomer thinking. The younger you are, the more you want your work life to reflect your personal life and beliefs. Some of that is just simple nativity. Some of that is probably a better way to work.

What I know, as a leader, is that we can’t have non-stop division within our workplaces and thing that will lead to a successful company. It won’t. So, we have some choices to make. We can decide to only hire people who think just like we think. Which sounds like the opposite of inclusion. Or we can work really hard to help our employees understand that having people around us that might have different beliefs is a positive thing if we really work to get to know the other person.

Another day making decisions no one wants to make!

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On the phone this week with a few HR Pros from the hospitality industry (think hotels and restaurants) some of the folks hit the worst by the pandemic. We start the call like most calls – “how are you doing”.

At some point during the pandemic, when this question is asked, I kind of just started laughing. How am I doing? How are you doing? It’s a pandemic! We survived another day! Does that answer the question?

My HR pro friend says, “It’s another day of making decisions that no one wants to make.” That struck me. She was right of course, that’s the job. Do we let go of Sally today, or cut some other important resource we can’t live without. Which is the lesser of two evils? Can I go home and have a drink already?

“It’s another day of making decisions that no one wants to make.” 

In a nutshell, this is leadership.

For all positives, we get out of being leaders we know there comes a huge downside. There will be times when you must make a decision that no one wants to make, but you have to. The knowledge of this doesn’t make it easier, it’s just knowledge.

What’s the silver lining of all of this?

I do think making tough, unbearable decisions, that no one wants to make, helps you as a leader understand real pressure from fake pressure. The greatest leaders I’ve been around didn’t panic in times that it didn’t call for it, or in times when it seemingly would have warranted it. They understood a call had to be made, no one was going to be happy, this is the job.

Here’s the thing though, with all of this. You can be in a position to make decisions no one wants to make, or you can be in a position where you are able to make decisions and stuff is just going to happen to you. Awful decisions are awful, but I’ll take that situation then not being able to make the decision.

Pressure is a Privilege

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“Pressure is a Privilege” – Billy Jean King

I’ve been watching the US Open this week and women’s finalist, Naomi Osaka was interviewed and said as she walks out onto the US Open court she pulls inspiration from the quote and sign that hangs just outside the court where the players enter.

In today’s world, we are all feeling a lot of pressure.

Parents struggling to work, teach, care for themselves. People fearful of the virus. People fearful of social and political unrest. People fearful of how they’ll pay their bills. It seems like every day the pressure just keeps increasing around us.

You are feeling pressure because something is expected of you. That expectation might be put on you by the outside world, or by yourself, but either way, here we are. You have expectations and that is a privilege. It causes us to be uncomfortable and being uncomfortable causes us to change and adapt.

Here is how King explains her own quote:

“I have this saying: Pressure is a privilege. Usually, if you have tremendous pressure, it’s because an opportunity comes along. I remember thinking about this, actually, when I was at Centre Court at Wimbledon. And I said, “All right. You’ve been dreaming about this moment. Is it a lot of pressure? Yeah. But guess what? It’s a privilege to be standing here.” Most of the time, in work or play or anything, if you really think about it, usually it’s a privilege. That I-want-the-ball feeling. Not “please double-fault.” Give me the ball. Give me the problem to solve. Let’s figure this out. Let’s go.” 

Let’s Go!

What if we only hired based on job interest? A Job Lottery!

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I heard about a very cool way that some schools are beginning to select student governments. Think about how the normal student government is selected. Some student government advisor, usually the school’s government teacher, makes an announcement for student government elections. Any student interested can throw their name into the hat, and start campaigning.

Then, reality hits.

The most popular girl decides she wants to run, and then the star quarterback decides he will also run, and the drum major of the student marching band puts her name in, it becomes a whos-who of the student body, all looking to butter-up their college applications. If you’re not popular or have a built-in voting base (school marching bands have a way of swinging elections if they elect in mass), you have zero shot at getting elected.

Now, if we changed from elections to a lottery system, every single person who has an interest in being a part of the student government now has an equal chance of being a part of the student government. Do you like this idea or not? (Listen to Gladwell’s podcast to see how this really plays out, it’s fascinating!) 

Most people’s initial reaction is not positive about a lottery. We want to have our vote. Our say! A lottery seems random. The very worst person might win the lottery and then we are stuck! Truth be told, we are awful at selection! We are bad at selecting politicians. We are bad at selecting employees. Humans are just bad at knowing what’s best for them.

Think about how we select our President. If we had used a lottery to select the President all these years, half of the U.S. Presidents would have been female! A good portion would have been African American, way before Obama! We probably would have had a Hispanic President!

What Hundred.org found is that selecting student governments via lottery actually has produced a ton of leaders that school teachers/administrators, and students didn’t even realize could be great. We never gave them a chance, and they lived ‘down’ to our expectations. But, when chosen via lottery, they rose to the occasion. Also, just because we ‘elected’ the Prom Queen to be Student Class President, doesn’t mean they’ll be good, in fact, just as many that are good, suck!

Now, let’s take this in another direction. What would happen if we did a “Hiring Lottery”? Instead of going through all the interviews and such, we just have people show interest, and then we pull a name out of a hat? Do you think it would work?

Let’s add one thing. What if we had AI go through each person who showed interest and made sure they met our qualifications to do the job? Would you have buy-in then? We had 100 applicants who meet the criteria of the job, we spin the ping pong balls and pick one, and Welcome to ACME Inc., Mary! You won the job lottery!

What do you think Mary’s chances of being successful are? 50/50? Lazlo Bock, in Work Rules, says Google was only 1% better than 50/50 in their selection, so it would seem like 50/50 would be a really strong success rate for your hires!

I have a strong belief that with many of our roles, especially those that are low-skill, no-skill jobs, a hiring lottery would actually be considerably more efficient and eliminate all bias, and would probably produce more applicants for organizations. Also, when considering lower-skilled jobs, “job interest” might be the most important criteria to consider!

Could it work in skilled professions? I think it would probably work exactly the same, it’s just a harder sell to executives since they have skills and want to desperately believe those skills matter over someone with similar skills!

Tell me what you think! Would you be willing to hire via a Job Lottery!?

How many people in your profession actually know what they are doing?

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I asked this question recently to a number of people. On a normal distribution curve of performance it should look something like this:

-20% are Top Performers

-70% are Average Performers

-10% are Not Performing at all

So, my belief would be if I asked an individual in any professional occupational role, “Tell me what percentage of pros in your field actually know what they are doing?” That I should get a very similar distribution. But I didn’t!

Ask yourself this question right now. How many of your peers, doing the same job you are doing right now, actually know how to do the job?

If you are a plumber, and I put ten plumbers in front of you, are you confident 80-90% can do the job? No? Then how many? If you are an HR Professional, what percentage of your peers are actually good at our profession?

Here was the breakdown I received, in terms of what percentage of peers in your field can actually perform at an acceptable level, as rated by their peer group:

Only 1% of the 394 people surveyed felt like over 90% of people in their field knew what the heck they were doing! 18% of people felt like less than 10% of the people in their field knew what they were doing! 

What does this tell us?

Almost everyone overrates their own performance and underrates the performance of those around them doing the same job. It’s really hard for us, in a peer setting, to look at others and go, “yeah, Mary is way better than me!” It’s way easier for us to look at a peer and go, “Oh, Tim? Yeah, he’s an idiot! We don’t let him get near the Happy Meals!”

What I actually tend to find when auditing various functions within an organization is that most people can actually do the job that is requested, when it takes lower-level skills. As you ramp up the skill difficulty is when you see larger variations, which isn’t very comforting.

What are the professions that take high skill? Medical, legal, accounting/finance, technology, etc. Most of these professions, to be really good, you need a combination of a strong education, experience, continual learning, and high attention to detail. Because most of these professions are high paying and have high hiring needs, many people are trying to get into the field, but don’t have all four of the requirements mentioned!

Anyone who has gone through a frustrating medical issue where doctors couldn’t find out what was wrong, only then to go to a more well-known medical facility and immediately get a real diagnosis and treatment, understand this perfectly.

If you’ve been through a difficult legal battle you understand the difference between a $300 an hour lawyer and a $1000 an hour lawyer! There are certain things in life you don’t cheap out on. I don’t want the cheapest brain surgeon or tax accountant or criminal defense lawyer. I’m okay with the cheapest quote to cut my lawn.

The difference in skill and performance levels amongst peers is probably greater than we think. I don’t think 20% of people in the same profession are top performers, it’s probably closer to 1%. We know rock stars in a profession when we see them, and it’s rare. You don’t have 2 or 3 on every team.

That’s why it’s critical that if you have high performing talent, at any level, you do almost anything to retain them. Most will outperform a handful of average to low performing peers doing the exact same job.

 

Is it okay to be biased for underrepresented communities in hiring?

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I’m a big podcast listener. It’s one of the reasons we started HR Famous because we loved the format! One of my favorite podcasts to listen to is The Prof G Show with Scott Galloway.

If you aren’t familiar with Scott Galloway he’s a New York University professor of marketing and hugely popular. He’s a liberal and rails openly against Trump and also his own industry, Higher Education. I’m a moderate and he’s so freaking smart, I could care less about his political leanings, I just get smarter listening to him.

Besides being a professor, he has started and exited a few technology companies, sits on boards, has school-aged kids, and talks a ton about the stock market.

On a recent pod, Elitism: Money vs. Influence, he gave his top 3 attributes the top-performing employees of the companies that he has started. These are:

  1. Most likely Female. “First they were female. If they were male I couldn’t say this but it’s okay because as long as you are biased for underrepresented communities your okay, but we try and ignore that…” (42:03 in the pod)
  2. Graduate from a world-class university. Ivy League, Penn, Michigan, Stanford, Berkley, Vanderbilt, etc. “Better schools matter…more applicants…start with better core human capital…better screening.”
  3. Athletes are very successful. They understand teamwork, discipline, they can endure and push themselves harder. “Someone who can finish an Ironman isn’t lazy”, says Galloway.

So, Professor of NYU, former business owner, and thought leader says it’s okay to be biased in selection.

I’m not sure I agree we should ever be biased in our hiring selection practices, but Galloway points out a reality in our culture. As long as we aren’t biased towards the majority, we will look the other way and ignore it.

What Galloway is saying is not different than how the vast majority of hiring managers are making their final selections. They take a look at past and current performance and they make some educated inferences about what those top performers have in common. Based on this knowledge, it will shape their hiring selection. Does this, or could this, lead to bias? Yes.

Does it make it wrong?

That’s the big sticky question, isn’t it?

We want to say, no, it’s fine, continue to hire the females if those are your best performers. But, just because your current females are your best performers doesn’t mean they’ll be your best moving forward, or that maybe one of the males will be even a better performer.

Flip the scenario.

Galloway now tells us that one of the three attributes for high performance is they are “male”. Do we have a problem with this now? Most likely, you do have a problem with it based on hiring equity issues, broadly, but it’s hard to say specifically since maybe this organization doesn’t have gender equity issues.

Want to know what Inclusion is difficult when it comes to organizational dynamics? It’s because what Galloway laid out is exactly what every organization lays out. The difference is, it isn’t always friendly to the underrepresented community.

Like I said, regardless of your feelings on this one subject, Galloway’s podcast is money! It’s on my must-listen to pods each week.

Give me your thoughts on this in the comments?

Creating friendships at work during a pandemic is really hard!

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We’ve been told for years now, based on the Gallup research, that having a best friend at work is one of those anchors that will lengthen a person’s tenure with an organization. New research is proving this might not be as easy it sounds! Business Insider:

A Study by Plos One asked students to rate their friendships and also rate whether or not the ‘friend’ would reciprocate by telling researchers they also believed they were friends. Here the results:

In 94% of these perceived friendships, students expected them to be reciprocal. So if John rated Jack as his friend, he expected Jack to rate him as a friend also. But this was so in only 53% of cases; less than half of the students had their friendship beliefs about others reciprocated.

Ouch! Almost half of your friends, do think of you as a friend!

The researchers point to the social network-style of so many friendships today of why people have this wrong perception. People are now building so many friendships with individuals they rarely see or interact with but feel like they have a strong friendship with.

So, what should you be doing as an HR Pro to take advantage of the Friend Anchor?

1. Help provide real-life interactions with your employees to build ‘real’ friendships, not just social network friendships.

2. Give employees the opportunity to work with employees of their choosing on projects. Give an employee a project and let them pick their team to work on it.

3. Don’t ignore those employees who don’t interact with anyone. This is usually the first red flag you’ll get that a person is unhappy at work and more likely to turnover.

I know you didn’t get into HR to play a friendship matchmaker! But, if you value retention and want to lower turnover, being a great matchmaker might be the best tool you have in the HR toolbox!

To increase the difficulty of the position of being a matchmaker, what will you do for a remote workforce to increase friendships? The truth of the matter is it easier to create friendships in person, face to face, then it is when everyone is remote. The process of workplace friendship building has to be purposeful, and again this will mostly fall on HR pros to lead.

Also, remember, you can pick your friends and you can pick your nose, but you can’t pick your friend’s nose. Unless they’re a really, really, really good friend, but even then, that’s creepy, don’t do that.

7 Things Start Ups Teach Us That Will Increase Our Success!

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My buddy John Hill works for Techstars as the VP of Network, go connect with him, he’s completely an awesome guy who will sit down and have a beer with you and talk about how to change the world for hours!  Last week he got to meet the latest crop of Techstar startups and came away motivated with some great learnings.

Here are John’s takeaways from the newest Techstar startups:

1. Nothing beats hustle. Nothing.

2. The world is full of good ideas, but only a few will execute them.

3. Relational capital is vital.

4. Networks matter. Surround yourself with those who can help you.

5. There are some wicked smart people in the world.

6. To build a great company you need help with funding, talent, and connections to business/industry to scale and the understanding of how to navigate each.

7. Suspend disbelief!

I’m drawn to each of the seven for different reasons but #2 jumps out because I witness this on a daily basis. There are two kinds of people in the world: those who execute and those who talk about executing. Hire those who execute. Understand that they are rare and you should overpay for this ‘skill’.

Do you notice nowhere on his list does he talk about failure. John is a motherfucking doer! He gets shit done. Techstars will only take a chance on startups led by people who will execute. John talks about ways to succeed not about just throwing caution to the wind and failing. The reality is most will fail, setting yourself up for success is key.

I love that he ends his list with “Suspend disbelief”. The world is a critic. Those who make it big have that special combination of John’s list. Great idea, ability to execute, the right network to make it happen, super smart, etc. What they also have is true belief! At the end of the day, you have to believe 1000% of your idea is going to work. No part of you even questions that it won’t.

If it didn’t work you would be destroyed because your belief was so strong that you never saw it coming when it fails. That’s how most great ideas actually make it. You find a combination of all of these things and you put money and resources behind it.

These 7 learnings aren’t about how to make a startup successful. These are how you make anything successful that you’re working on.