Topgrading

Last night on Monday Night Football there was a segment showing how #1 draft picks had worked out.  You know what their performance has been — generally very disappointing.  I’ve heard that teams recruit largely on the basis of films colleges send, and the interviewing process is more selling than vetting “candidates.” 

Too bad — my hunch is that a very thorough Topgrading interview, digging into the young man’s course work, high and low points in high school, high and low points in college, influential people, and details of every part time or summer job …. would produce more predictive insights into how the person will actually function.  It would have been illuminating, for example, to learn that Michael Vick was involved in dog fighting.  It’s just a thought …

CEO heads are being chopped off as though it’s a version of the French Revolution, and the business world collectively shakes its head and wonders, “How do such incompetent people get hired by boards of directors?”

 The answer is as simple as it is appalling:  Crummy hiring practices! 

Boards have a Selection Committees that hires search firms that give the appearance of being thorough while concealing negatives and hyping positives of candidates.  (In my experience 10% of search executives are A players who really do a great job attracting and screening candidates).  When board members “interview” finalists it is  all very “professional,” with few tough questions asked over lunch.  And, there’s seldom an in-depth, hard-hitting, chronological Topgrading interview.  Reference checking is with people finalists choose.  What a lame process!

A few weeks ago I talked for 1 1/2 hours with one of the smartest guys on  Wall Street — a former CEO of one of the most prestigious companies.  As a board member he had interviewed a candidate for a top job and was thrilled with him … and amazed that my assessment was so negative.  The board member had asked a lot of philosophical (what are your beliefs?) and hypothetical questions (how would you handle this challenge) and the verbally adroit candidate had great responses.  But my interview nailed down a consistent record of MEDIOCRE PERFORMANCE.  The board member was very appreciative, thanking me for preventing a serious mis-hire, and for teaching him that the only really valid interview is one that scruitinizes every success, every failure, every key relationship, every key decision, and overall performance in every job.

There are now about 20 Topgrading professionals, and private equity firms use us all the time to assess management teams and candidates for top positions of companies they are considering buying or their portfolio companies.  But we rarely get calls from boards of public companies (probably because the board members have never heard of topgrading).

 Until boards of directors substitute the thoroughness and validity of topgrading for the shallow, deceptive, and non-valid approaches, the shareholders they represent will surely suffer.  This is a major flaw in our otherwise very solid economic system. But I’m preaching the choir, right?

AMBITIOUS MANAGERS SHOULD WORK HARDER TO FIX THEIR SERIOUS WEAKNESS(ES) THAN TO BUILD ON THEIR STRENGTHS

Having assessed and coached 6,500 senior managers, my experience tells me you should ignore the common “wisdom” that people should just work to keep their strengths rather than to try to fix their weaknesses.  An article in the November, 2007 issue of Training and Development (“The Positive Payoff”) conveys that common viewpoint.  It sounds sensible for the world-class miler to run miles and not to try to convert to an event he’d hate and fail at – pole vaulting.
 
Trouble is, management is like the decathlon, with a lot of “events,” and if someone is strong in 8 events but weak in 2, that person will not succeed if competitors are strong in all 10.  Management requires a lot of skills, many of which are necessary, not just desirable.
 
 I’ve sat in on a thousand meetings in which managers were considered for promotion, and the people who get promotions of course have many strengths.  However, the most important consideration almost always is that they have no “fatal flaws,” “derailers,” or serious weak points.  My role as a coach is much more to help managers fix one or two serious weaknesses than to help them maximize their strengths. 
 
In my book Topgrading:  How Leading Companies Win by Hiring, Coaching, and Keeping the Best People (Portfolio, 2005) I have a large section entitled Fix Your Weaknesses, and present case studies in which good results became even better when managers minimized a serious weakness.  Over the years I’ve also worked with some super talented people who simply could not control their negative treatment of people.  One was given 2 years to improve, but he got worse – publicly humiliating his people and peers, using biting sarcasm, etc.  He ran the most profitable division, almost single handedly, but was fired.  The CEO said, “Pete, you’re brilliant at running one division, but 16 out of 18 peers told me they’d quit if you are promoted to President.  So, you’re fired!”
 
For management jobs, my experience is that high performers who want to earn promotions quite naturally maximize their strengths every day.  They know they are great at product launch projects, public speaking, analysis of financial reports (or whatever); they love exercising their strengths, read articles and go to seminars to strengthen them, and too often ignore working on one or two competencies they must have in order to get promoted. 
 
In my book I break out 50 competencies into groups including competencies that can be significantly improved on in one year (personal organization, writing, and even treating people with respect), and those competencies that generally can’t be improved on a lot (honesty, drive/energy).
 
Actually, for individual contributors, which are most people in companies, I totally agree that they ought to stick with their strengths and what they love to do, and not waste time trying to fix weaknesses that have no bearing on their success or job satisfaction. The creative ad person is probably better off staying in marketing than maybe trying to make more money by transitioning into an accounting job that would be boring. 
 
But as soon as people move into the world of management, and particularly when they want to be promoted two or three levels – aha, that’s where all those meetings I’ve been in make it clear that weaknesses knock people out of promotions all the time!  That’s where the decathlon analogy is quite real!

SUMMARY

I am frequently asked about the value of working on fixing weaknesses and make the point:  for individual contributors, don’t bother trying to fix your weaknesses and instead go with your strengths, but for ambitious managers, fix your serious weakness(es) or your career will plateau!

Last week I was in Turkey and heard about a man who has to be one of the most successful leaders of the 20th century — Ataturk of Turkey. I couldn’t believe what people were saying about him, so I picked up some biographies (best is Ataturk: Founder of a Modern State). This guy was the most courageous and effective change agent and leader imaginable.

In a nutshell: It’s WWI, and the Ottoman Empire lost, but Mustafa Kemal (later added a last name, Ataturk), a military leader for the Sultan, didn’t give up. He decided to start a country, call it Turkey (like the US losing a war but someone trying to salvage part of it, say, Massachusettes, with a new name). Trouble was, the “Turks” had no identity and the people were backward (think 12th century), superstitious, hyper religious, and lazy. Not many A players.

Ataturk, who had never lost a battle, realized his vision — he started popular assemblies that ultimately elected him and made him supreme commander and he whipped the Allies and separately the Sultan’s forces. At the same time he led processes to get his country and the world to recognize a new country (Turkey) and a new constitution that substituted a democracty for a theocracy, gave women full rights, stimulated free enterprise, and the value of world peace (in other words, giving up wars for expansion).

Unbelievable! He converted a totally backward religious people into a secular state. As an aside, I can’t believe the US has been mistreating Turkey — the perfect model for how Iraq might change, and it’s next door to Iraq.

The biography has some fascinating leadership insights — like how to defeat armies (militarily), Islamic fundamentalists (war of ideas and values), and move a heck of a lot of cheeze. He changed the language (discarding Arabic in favor of Roman), got everyone to add a last name (too many Mustafa guys), and helped a populus of lazy goat herders to become hard working capitalists. One of his tactics:

Pretend a change isn’t necessary, sneak it in, and then claim it was inevitable … while constantly adding A players to the ranks of supporter.

If you liked this blog, read about a dude who, against all odds, started a country (called the United States). Nope, not George Washington, but William Bradford. Read a short synopsis of full article I published by signing up for the monthly newsletter Topgrading Tips and keeping your eye out for the next issue.

First Aid for Your Topgrading Interview!

If you are not achieving at least 75% high performers hired or promoted…you’re probably making mistakes that you can quickly fix – really!

Mistake: Breaking the Topgrading Interview into halves with DIFFERENT interviewers for the first and second halves.

First Aid: Use the same interviewers for the full Topgrading Interview.
The beauty of the Topgrading Interview is the clarity of PATTERNS that evolve across a person’s life and career. There’s no way the “first half” interviewers can pass enough insights along to the “second half” interviewers!

Mistake: Failing to see patterns that make it easy to rate all key competencies.

First Aid: After the interview use your notes from the Topgrading Interview Guide to visually portray how successful (or unsuccessful) the candidate has been.
For example:

This is a “snapshot” of a super sales rep, who exceeded quotas in strong economies (1997-2000) and down economies (2000-2002), but who is not an A player sales manager. He’s a “do it myself” manager who hasn’t learned to hire, coach, motivate, or develop teams. If you want to hire a sales manager, don’t bet on this super sales rep whose performance in management is declining!

Mistake: Performing Topgrading Interviews before learning how.

First Aid: Practice one or two Topgrading Interviews on lower level people, to find your groove.

Initially Topgrading interviewers stumble a bit, have to read questions, and spend too much time on the candidate’s education and early work history. If you feel a bit awkward, any A player candidate will find the process awkward too. So develop your skills and confidence before interviewing “for real.”

Mistake: Going “solo.”

First Aid: Use the tandem interview (have an interview partner).

About a month ago I complimented Jack Welch (former Chairman of GE) on his approving TWO interviewers. Not only did GE improve its success picking people to 90%, THOUSANDS of managers have done the same, following this tandem Topgrading Interview model:

• The main interviewer asks most questions and takes some notes.
• The secondary interviewer asks a few questions and takes a lot of notes.

CONCLUSIONS

To hire or promote with 75% - 90% success, you MUST use the Topgrading Interview. No other method comes within a country mile of achieving such success. To get excellent results practice a little on “easy” interviewees, use the tandem model, and write a 10-year “snapshot” to see clear patterns of overall performance.

Cut Phone Screen Time 80%

Telephone screening, according to a recent survey, takes up to 20 hours per person hired!  This article will show you how to cut the time 80%, to about 4 hours. 

Readers of my books know that Topgraders use the phone screen to reduce the number of candidates to those who will be interviewed in person, and the phone screen is usually a “trash-compacted” Topgrading Interview.  It takes an hour.  OK, but an alternative is to use questions that more quickly flush out great candidates.  When a job has objectively measurable results, like sales rep, a quicker phone screen than the “trash-compacted Topgrading Interview” can be used.  This article contains phone screen questions for sales rep, but consider it a model; you can develop similar questions for other jobs.
 
The following questions were developed by Greg Alexander, a Topgrader and one of the greatest sales executives I’ve known, and, as of last week, co-author of a book we just agreed to publish with Portfolio: Topgrading Sales Organizations. 

Here are the telephone screen questions for sales rep:

1. Please describe your territory.  (Is the sales rep selling based on geography, product line, or names of accounts?  Is he/she really on top of the territory?)
2. Please describe the quota system.  (Is the candidate measured on revenue, gross profit, unit sales, new accounts, etc.?  How well does the candidate explain the keys to success?)
3. Please describe your production.  (Nail down performance vs. targets.  How engaged is the person?  Make excuses?  Get answers to #1 - #3 for more than the present job, perhaps the last three jobs, to perform a more thorough screen.)
4. Please describe your compensation plan.  (Is there understanding of how sales rep success drives company success?  Is the person motivated?)
5. Please describe your company’s value proposition.  (This should be an “elevator pitch,” 30 seconds.)
6. Please describe your major competitor’s value proposition.  (The differences between #5 and #6 should be very clear.)
7. Please explain the top three objections you must overcome to close sales, and how you overcome them. (Does the candidate beat the competition?)
8. Please describe your typical day and week.  (Does the person work hard and work smart, doing administrative work after hours?)
9. What do you like most and least about your job?  (A complainer?  Would things be different in your company?)
10. Please describe what you like and dislike about your last two bosses, and give your best guess as to what they would tell me in reference interviews you would arrange, are your strengths, weaker points, and overall performance.  (Do you fit the profile of what the candidate likes in a boss?  Does he/she come from a competitive culture?  Is the person honest, or doing a whitewash?

By the way, Greg Alexander is the owner of Sales Benchmark Index (http://www.salesbenchmarkindex.com/), and he’s identified dozens of benchmarks that you can measure your sales organization against and figure out how to improve it.
 
For those new to Topgrading, here are our broader recommendations on how to reduce phone screening time and end up with just terrific candidates to interview face to face:

1. Recruit from your Virtual Bench – people you already know are great.
2. But if you have to run ads, cut 150 resumes down to the best 30 the good ‘ol fashioned way – wading through those incomplete documents Sunday afternoon while watching TV.
3. Send the 30 the Topgrading Career History Form, which asks for complete comp history, likes and dislikes of jobs, every month and year for every job (people can hide jobs when they just give years and not months), and a full self appraisal.  A week later all the completed career history forms can be reviewed in an hour, cutting the 30 candidates to maybe 6.
4. Then call the 6 and use the phone screen questions, and you’ll be left with 3 or 4 of the truly best candidates to interview in person.

Follow these steps and you can cut 20 hours of phone screens to 4 hours, and get better candidates to interview in person.

“TOPGRADING INTERVIEWS TAKE TOO MUCH TIME”

Recently an executive read the Topgrading handbook and learned that a tandem Topgrading Interview of a manager might take two interviewers three hours.  “I don’t have that much time for just an interview,” he said.
 
He had just admitted that three out of four of his management hires were mis-hires, and so I asked him how much time he wasted on each of those mis-hires, and he estimated 100 hours each.  Let’s do the math, adding up all the time for one high performer hired, with his results (25% success) vs. a Topgrader’s results (90% success).  The Topgrader eventually will have a mis-hire, but for any given job filled the chances are 90% that the first person hired will be a high performer; hence – 10 hours wasted on the average, per good hire. 

The non-Topgrader has three mis-hires before hiring the high performer.  Hmm, 3 X 100 hours = 300 hours wasted with hiring, onboarding, coaching, training, disciplining, and replacing the three mis-hires.  The Topgrader wasted 10 hours.  300 hours or 10 hours.  This executive doesn’t have time for a three hour tandem interview but can waste 300 hours on mis-hires.

MOST PERSONALITY TESTS ARE SHAMS!

We get lots of questions about testing, because clients would love to have some sort of inexpensive screening device that cuts the candidate pool down to just a few to call and then to interview.  Unfortunately, the fact is that most personality tests are validated in a devious way that makes the tests look useful, when they are not.  I’ll explain why:
 
I have on my desk the validation manual for one of the many personality tests used to screen candidates for sales positions.  It’s a thick manual.  When the test is “tested,” it’s administered to present employees, with the promise that their score will not be known to their employer.  OK, so the current employees have no motivation to fake answers; they are honest, and so sales people might admit they are not highly motivated, that they call on present customers when they should call prospects, etc.  Then the test purveyors match the results against performance and, VOILÁ, the people who sell the most are the ones with the highest test scores.  The test appears valid!  But it’s not.

The only honest way to validate a test is to administer it to candidates for selection; don’t even score the test for a year, then pull out the test, score it, and then see how the scores correlate with performance.  When real selection candidates take the test, they fake it – sales candidates say they are highly motivated, that they of course call on prospects, etc.
 
Years ago I validated several personality tests that were being used by one of the largest retailers.  We had 2,000 subjects.  The company thought the tests were highly valid, but when I validated them properly (with hiring candidates, not present employees, taking the tests) the value of every one of the tests was ZERO!  And unbelievably, the sham test purveyors are telling the truth when they say their methods are approved by the American Psychological Association.
 
Recommendation:  get the validation manuals and don’t be intimidated by all the statistical mumbo jumbo.  Just look for how the tests were validated.  If the manual does not say that candidates for hire knew they were not hired yet when they took the test, you have a problem.  Call the test purveyor and challenge the validation results.  Or, administer the test to 200 candidates the way I described, and see for yourself it the test really works.  Don’t hold your breath!
 

Improve Onboarding, Coaching, and Retaining Talent

Experienced Topgraders can skip over this article and scroll down to “What’s New in Topgrading” because you know that onboarding, coaching, and retaining people are relatively simple when you’ve screened people with the Topgrading Interview.  For others – read on and you’ll understand why!

Recently I was on a conference call with 10 HR executives with global companies totaling $1 trillion in revenues, all complaining that onboarding was unsuccessful, most managers are lousy coaches, and it’s hard to retain top talent.  Most companies have problems in these 3 areas because their hiring processes are so superficial.  Most use round-robin competency (behavioral) interviews that result in 75% mis-hires.

1. Onboarding is a broken process when square pegs are hired for round holes.
2. Coaching is a heck of a lot more difficult with mis-hires.
3. Retaining top talent is problematic when A players report to C players and when managers don’t really understand hirees’ needs and motivations.  Superficial hiring leaves managers with vague understanding of what will retain people and so they are surprised when talented people quit.

Topgraders onboard, coach, and retain with relative ease, because they put round pegs in round holes 80% - 90% of the time.  Topgraders have MUCH more information about new hires than managers who use superficial round robin competency interviews.  The chronological Topgrading interview reveals strengths, weak points, values, motivations, and ambitions by asking about every success, every failure, every key decision, every important relationship, and reasons for every job move. 

So, for Topgrading interviewers:

1. Onboarding is a breeze because, with a thorough understanding of the new hiree, it is “obvious” what the plan should be to introduce the hiree to the company, key coworkers, and learning materials. (OK – some companies are so complex that new managers participate in three-month onboarding programs, but even these elaborate programs fail when there is a mis-hire.)
2. Coaching is easy, because good hires, high performers, are eager for feedback, take criticism constructively, and trust you.
3. Retaining talent is no mystery.  Topgraders know what challenges, opportunities, and rewards will retain their new high performers.  So, managers tweak jobs and shuffle their high potential people to meet their understandable and desirable needs to grow, expand, and achieve.

Summary

“Everything goes better with Coke” may have been a cheesy slogan, but “All people problems are minimized with topgrading” is quite true.

How to Avoid Mis-Hires

No one hires 100% high performers, and some experienced Topgraders have shared the details of their occasional mis-hires.  All the companies are achieving better than 75% HIGH performers hired, and all are using the Topgrading Interview Guide, with tandem interviewers.  The analyses of mis-hires disclosed seven problems, and recommended solutions are offered.

   1.  “Mary was great designing the new system, but when she tried to sell the organization, she p—-ed everyone off.”

Recommendation:  Be sure the job scorecard includes measurable accountabilities for all crucial parts of the job, not just a part of it.  Mary was screened well for the designing but not the selling part of her job.

   2.  “The C player later said he didn’t really understand the job.”

Recommendation:  Show the job scorecard to candidates and arrange enough interviews that they can do proper due diligence on the job.  A players usually demand to get thorough information on the job, but some aren’t as requiring as they should be.

   3.  “Reference checks were glowing, but the previous jobs must have been a lot easier than ours.”

Recommendation:  In reference checks, as in interview discussions of successes, failures, etc., get specifics.  A person who worked in a French company 40 hours per week could be described by the boss as “working extraordinary hours,” but if  the job you’re filling requires 60 hours, a mismatch could take place.

   4.  “Our tandem interviewers didn’t grasp the significance of the mis-hire’s two job failures out of six jobs.”

Recommendation:  Hire people without 1/3 job failures. Why?  Most jobs are more complex and challenging than originally expected. The #1 most important competency is resourcefulness, because resourceful people snatch success out of the jaws of defeat.  In this case two job failures occurred when the new job was only slightly more complex than the current one.  That in retrospect was a bright red flag!

   5.  “Our tandem interviewers didn’t connect enough dots.”

Recommendation:  Have managers conduct one tandem  interview each quarter, minimum, to keep up the skills. Or … watch the 1-hour hiring video at least once per year.  A serious mis-hire occurred, and when analyzing the costs and their collective failure, the interviewers concluded that they were  simply too “rusty” to cope with a smooth … and in retrospect glib candidate.

   6.  “One of the tandem interviewers was just awful.”

Recommendation:  Only permit skillful interviewers to conduct Tandem Topgrading Interviews.  The weaker interviewers can do 50-minute competency interviews, but don’t let them cause mis-hires by dragging down tandem  partners. 

   7.  “Some interviewers cut corners – their interview guides contain few notes, few follow up questions.”

Recommendation:  Require tandem interviewers to submit their completed notes for all interviews, not just ones where there was a mis-hire.  Use a Hiring Checklist and require all steps to be taken in order for a job offer to be extended.  I’m sorry to report that too many busy managers cut what should be a three-hour interview of a managerial candidate to one hour, and their mis-hire rates skyrocket!