Category Archives: Hiring

The Reckoning

For just about as long I can remember I have heard that what you have learned, and what you know, and your experience are valuable. They are the tools of your trade in the knowledge-based businesses and economies. And to some extent I think this idea may still apply, at least in part. I think that there will always be a need and desire for intelligent people in the businesses of today and in the future. One of the best accepted ways to demonstrate intelligence is through the attainment of a college degree. This may or may not actually demonstrate the intelligence level, but it is the now somewhat de-facto threshold for employment in the technology and knowledge-based economy. However, I think that now more than ever before, where you live is going to be one of the key driving factors to your employability.

This is particularly the case for the larger companies and organizations. I am sure that there are those that are reading this and are thinking: “What is he talking about? The rise of virtual offices, and working at home, and so on and so forth, have removed location from the context of the employment equation.” (That employment equation being the value that you generate for the company needs to be perceived as greater than the fully loaded cost of your employment by the company.) Please bear with me, as I think you may be thinking too small, as the true effects of globalization start to take effect in areas other than factory production.

As usual, there was a genesis for this direction of thought. It came in the form of an article by Erin Fuchs, Deputy Managing Editor at Yahoo Finance, titled “Why Wages Aren’t Rising Faster”. ( In the article he examines why, in a period of historically low unemployment, what amounts to the usual economic model of high demand for labor versus a stable supply has not resulted in higher wages, as the model would predict.

He points out three things that are occurring that are holding wages down. The first element he points out is that the data now indicates that there is no longer a growth in employee productivity occurring. I don’t know if this is due the virtualization of the office and the accompanying loss of “synergy”, or if the process driven structure of organizations is starting to reach an asymptotic limit. What it does mean is that growth now will be linearly linked to the number of people doing the same type of work. Sort of like that factory production line model, and I think we all know what eventually happened to the factory production line job. I’ll come back to this idea in a minute.

The second element was the “…misleading nature of average wage growth figures…”. I take this as a direct reference to Mark Twain, who is credited with saying: “There are three kinds of lies: lies, damned lies, and statistics.” Simply put, this means that one Bill Gates retiring from the workforce can and will offset many of the lower paid positions’ wage gains that might for example affect the food service industry. This is also an interesting topic that I’ll revisit.

The third piece to the wage stagnation puzzle was the ability for companies to opt to hire overseas, in lower-cost countries, instead of paying the higher wages being demanded in the higher-cost countries.

This seems to me to be the element that ties the previous two items together.

If you are working at home, in a higher cost country, why can’t someone else do the same work at home in a lower cost country. As we noted earlier, we have removed the distance issue from the virtual organization. So, while it may not have mattered where in the country you lived in performing your job, it now seems to matter to a much larger level, what country you live in when performing your job.

When the employee productivity curve starts to flatten out, as it appears to be doing, the only way to continue to show business improvement is to reduce the cost of each of the linearly added employees. Processes that have more and more finely defined employee functions can now be applied to less costly employees in lower cost countries. Any quality or productivity issues can be absorbed in the overall value of the resulting total cost reduction.

I think we are already seeing the start of this approach to business. Those disciplines that do not require direct customer or market interfaces are already moving out of the expensive higher-cost countries. Production and manufacturing were the first to go. Research and Development were not too far behind. Don’t confuse the spark of creativity with the work associated with developing a product from it. Soon Human Resources, Finance and Accounting followed. These were also essentially well defined, repeatable functions with well-defined processes and procedures.

This essentially left Sales (a direct customer interfacing function), marketing (a culturally dependent function) and operations (the customer delivery function) as the only mandatory functions that need to remain in a high cost country (or any country for that matter). Any other corporate function, or support function could and would be moved as soon as it made economic sense to the organization.

In the past it was argued that when the average wage rates increased, it was the more highly educated that benefited as opposed to those in the lower paid roles and positions. It now seems that the fruits of this type of environment have also sown the seeds of the issue that is now faced. It is now the higher cost, well-educated roles that are being lost to lower-cost countries, while the lower waged roles are now benefiting from the new laws aimed at increasing the minimum wage.

The interesting dichotomy here is that while the government may be imposing a new, elevated floor to the wage pool in the form of an increased minimum wage, businesses are in the process of imposing a de-facto ceiling or upper limit on what wages they are willing to pay in the same market. So, while the minimum wage may be rising in the strong employment market, the group that had benefited the most from strong labor markets, the educated and experienced, are now losing ground.

This has created an interesting situation and some even more interesting trends. Highly educated, highly experienced, and highly paid people are being shed by larger organizations as the company looks to continue to show bottom line growth. This availability of talent is seeing their market opportunity change. They can bring their benefits to smaller organizations, but at usually smaller wages as that specific type of labor supply increases. This is indeed what has been seen in many instances.

Or they can move more toward the “Gig Economy” where there seems to be growth in what could best be described as “Fractional” employment. Fractional employment is a situation where a smaller company may need an experienced, knowledgeable employee, but just does not need them full time, or all the time. So instead of offering a lower paying full-time position, they can offer a higher paying (based on hourly rates) part time role. This then leaves the contracted employee with the opportunity to either fill the rest of their available time with other similar roles, or not, as they choose.

This enables both the employee to maintain their desired income level, but only through employment at multiple locations, and allows companies to reduce their resource employment costs by no longer having to employ expensive resources full-time, when they are desired, but not effectively needed.

The interesting addition here is that the “benefits” usually associated with employment (insurance, vacation, etc.) are reduced for both the employer and the employee. Remember, employee benefits cost employers more than thirty percent of total employee expenses and are not usually paid to contracted or part-time employees. (

This brings us to the reckoning. The trend has started in high cost countries and markets. Higher cost higher educated positions in the larger organizations for the most part have started moving to lower cost countries and markets in increasing numbers. It would seem that nothing short governmental intervention in this sort of labor migration will be able to stop it. These types of employment regulations may or may not exist to greater levels outside of North America, but again it would seem that they will only be effective in slowing down this evolution, not stopping it.

This change cannot but help to start to reduce the wage levels that were here to fore thought of as the higher-level incomes. There will be more, higher educated and experienced resources chasing fewer onshore opportunities. Even though employment levels may be high, the higher end, higher paying opportunities once thought of as only available to the highly educated will start to become less available.

One way to combat this outflow of positions is to reduce the cost of onshore employment. The movement to fractional employment should continue to gain traction. The reduction in the pay rates for these “highly paid” positions should also start to flatten out and even come down. Finally, as we have seen the end of pensions and retirement compensation in the last few decades, we should also expect to see a reduction in the benefits such as insurance, vacation, etc., (and the accompanying corporate expense) that companies offer.

So, while wages may be going up for some of the labor market, it would appear that they are heading down for those at the upper end of the labor market, even in such a strong employment market. Employment may indeed be at historical highs, but those that were once thought to benefit the most from these types of market conditions are now poised to face both reduced roles and reduced opportunities as businesses continue to try to reduce their labor costs.

Do Your Homework

I don’t know how many others out there have experienced the joy (ahem…) of looking for a new position, but I know I have in the past. It is never really any fun. It is an effort. The uncertainty creates discomfort. I have noted in the past that I am not especially good at asking others for help. I have met several other people who seem to be very good at asking for help and it would seem that they almost prefer others to do their work for them, but me not so much. I have tried to compensate for this by trying to freely offer help and thus enabling others to avoid the issue of having to ask me for help. On several occasions this willingness to offer help to others in their job searches has caused some unexpected problems.

I think the basic equilibrium point for most of us is to be a contributing member of an organization, a business and society in general. That simply means that most of us like to work and be employed. When we are not employed, or face the prospect of not being employed we are well out of our comfort zone. After all, just because we may not be currently employed doesn’t mean the bills and expenses associated with our lives will stop or be put on hold.

Much has been written regarding the requirement of people to be flexible and able to change when it comes to employment. On a conceptual level this is an admirable goal. When it comes to forced practical application for specific individuals it may be a whole other story. It is difficult to maintain a professional equilibrium when you are both figuratively and literally out of your employment comfort zone. How people handle this discomfort varies. I have found that there are a few factors that affect an individual’s performance during these times.

The first is experience. Have they been in this situation or position before? Knowing how the process works and how to both ask for and accept help is important. The second is duration. The longer people are looking the longer the twin (and opposing) factors of the (calming) understanding the situation and the (stressing) desire to return to employment equilibrium have the opportunity to take effect. The final and for me most important factor is preparation. How prepared were they for this situation, and how prepared are they to be able to deal with it?

The effects of the experience and duration factors, as one would expect, can only be learned with time. Experience is what you get when you don’t get what you want. The only way you get it is to actually go through it. I think it is the preparation factor that everyone to one level or another can affect. With a little preparation and homework, it may be in fact possible to at least partially mitigate the effects of the other two factors.

I have also noted in the past that with the possible exception of sales, which is has a performance rating that is primarily quantifiable (i.e., how much was actually sold, or the amount of orders received) almost all other disciplines have a qualitative aspect to their measurement. That means that an individual’s performance perception will at least partially be opinion based.

And as we all know, opinions do vary.

Just ask western figure skaters when it comes to eastern bloc judges.

We all must understand that while we all may feel we are operating at the peak of efficiency and performance, there are potentially always eastern bloc judges in management that may not agree.

We must also understand that companies are always under cost reduction and performance pressures. Market and competitive fluctuations may also drive corporate employment decisions that may not be based on performance, but rather on financial necessity.

There is the doing of your homework and being prepared for the potentiality of needing to find a new role, and then there is also the doing your homework in the actual search. As I said I like to try and offer my help, such as it may be, to those that may be in the search mode.

Something about “There but for the grace…go I” sort of comes to mind, meaning if I were in a similar position I would definitely appreciate those that freely offered their help.

There have been many times where I have met people, networked and asked how I may be able to help, when I have had some variation of the following conversation:

“Get me a job in your company.”

Really? I am here to try and help you get a job, not get one for you. What do you do?

“I can do anything.”

Really? Do you have a resume?

“Not with me. It’s a few years out of date and a little long, but I’ll be glad to send it to you. When do you think I can start?”

Here is a simple rule for networking or meeting with someone who might able or willing to help you in a job search: Do your homework. Help them help you.

Be concise. Do a little self-analysis and understand what it is you do and are good at. Accountants normally don’t make good sales people, and vice-versa. They normally have significantly different skill sets involved in their roles. Don’t tell anyone you can do anything. It makes you sound like either an egotistical braggart, or at the end of your rope desperate. Neither is a good image to portray.

Have an up to date resume ready. It should be two pages, no more. It doesn’t matter how many years you have worked. It doesn’t matter what you think you have done. Most people or companies are really only interested in your roles over the last fifteen or so years. Adding much on your accomplishments and positions before that doesn’t add to your value as they may be considered somewhat dated. If you have won a Nobel Prize or a Congressional Medal of Honor, it may be acceptable to extend the length of your resume to two and a half pages, but only if you have one, or both of those awards to document and explain. There really are no other excuses for a resume of greater length.

Do some homework on the company that the person you are meeting works for. All companies post many of their open positions on their websites. Have an idea what might be available. Be knowledgeable about what they do and where some of their openings are. Give the person you are meeting something to work with.

Many industries may be big, but the business world can be surprisingly small. Look up who the company’s competitors might be and check their sites for potential openings. It’s called “Networking” for a reason. People know other people in the industry and may be able to give you a referral if you can articulate what it is that you want, where it might be, and why you think that.

Many times when networking we forget just how many different people we know and the various companies that they work for. Providing this type of information does wonders in jogging memories and getting things moving.

It’s been said that you only get one chance to make a good first impression. This is especially important in the somewhat higher stressed environment of a job search. Coming to a networking meeting unprepared does not help with the first impression. You will be asking someone to give you some of their most valuable resource: time. Don’t make them feel that you, or they may have wasted it.

Take some of your time first and do some homework. Anticipate what questions you may be asked, and prepare your answers ahead of time. Do your research on companies and positions so that when asked you can identify the opportunities that are a good fit for you, and minimize the time that you are actually requesting. Document who you are and what you can do. Provide it. Don’t make them ask for it.

People understand that when you are out looking for a position that you are also looking for help. Make it easy for them to help you. It is all about time. Don’t expect that everyone will have all the time you need in order to be helped.

Please reread that last sentence just to make sure you get the meaning. People will be willing to help you, but they probably won’t attribute the same priority to it that you will. Time is of the essence and will be the medium of exchange. Spend a little of your time doing some homework so that you make it that much easier (and that much less time involved) for them to help you.

It will be time well spent.

Over Qualified

We have all to some extent undergone upheaval in our markets, businesses and careers. I have also continued to hear the phrase “over qualified” when it comes to new roles or new career paths. I have commented many times in the past about the fact that the way I look at the world can be considered to be out of step with the accepted norms, or conversely just “different”. Perhaps it is now proper for business managers to understand that throughout change in order to successfully lead you probably need to be out of step with the accepted management norms and be different.

My first question is: How can anyone be considered overqualified? As a leader don’t you want everyone on the team to be as wildly successful at their responsibilities as is humanly possible? Doesn’t the very act of them being successful by its definition make you successful? Don’t the most qualified individuals have the greatest probability of being successful?

Who will knowingly take on a team member with less training, or less education, or less experience, or any other material qualification than another potential team member? You have to pardon me here, but I can never remember thinking that I was looking for someone with lower qualifications. I was, and continue to always look for the best possible team members.

So if this is the case for the majority of business leaders, why is there so much being written about people being over qualified for various opportunities? I understand that the markets have changed and there are many people with significant capabilities whose previous positions for one reason or another no longer exist. However, their knowledge and capabilities are still there and can be an incredible resource to any team.

I think it comes down to the difference between management and leadership. Leaders want the best on their teams. Strong and qualified team members drive the leader to be just that, a leader. Leaders need to have the confidence to embrace the challenge of leading a talented and possibly “over” qualified team. It seems that over qualified people may need unqualified leadership.

It also seems that managers may also only want the best on their teams but with the only stipulation being that the team member not be a challenge, to them. Leaders understand that they may not have the market cornered on hard work or good ideas. They look for team members that can challenge them and each other while working toward the business’ goals and objectives. Managers may have a tendency to view this sort of behavior as a challenge to their personal authority instead of an opportunity for everyone to do better.

This type of behavior is not a challenge to authority, but it is a challenge to manage and lead.

Highly qualified individuals in my experience are probably more prone to display this sort of challenging behavior. If they think they have a good idea, or see an issue with the current plan they are apt to voice it. I think this is a very good trait. Leaders should not be the only ones pushing things forward; or rather I guess I should say that leaders are the primary ones pushing things forward, I just prefer that there be multiple people pushing on the team.

Better qualifications usually come with time. More time in school usually equates to a better educational qualifications. More time in training equates to a more work ready resource. More experience means that someone already has a track record of performance in similar or equivalent roles. When a leader is looking for someone for their team, these are exactly the types of qualifications they should be looking for.

A manager on the other hand may be concerned that someone could potentially have qualifications, or worse the capabilities to actually perform that manager’s job. That insecurity seems to me to be at the root of the “over qualified” argument. After all, who would want to bring someone onto the team that might be a better or more capable performer than the manager of the team?

A leader would.

This approach does not mean that you should look for only the most educated, trained and experienced. Having those qualifications does not necessarily make them the best. There is also a little thing called “talent” that must be factored in, and it knows no age limitation. The talented can be young or old, it doesn’t matter. Talent is more qualitative in nature and I cannot think of any hard and fast rules for identifying it. But I think we all know it when we see it.

I have mentioned in the past that I am a would-be musician. I enjoy music. I understand its theory. I practice. When you are doing something that you enjoy, practice is not work. But I also understand that I do not have the innate talent for music that others may have. It just means that I have to work at it harder than some for whom it comes naturally. It is a challenge to me and for me to keep up with them. And boy is that fun. To take the analogy one step further, even in music I try to search out and play with those musicians that are more talented than I am, because in turn it makes me a better musician for having played with them. There is no being “over qualified” here either.

None of us should expect to inhabit the roles we are in forever. Each assignment is indeed a step in our careers. Just as the roles associated with the members of the team are presumably steps in their careers. A certain amount of change is good for both the team and the individual. It keeps the organization vibrant. Obviously too much of a good thing can be detrimental. I think we have all been in organizations where the turnover rate exceeded a healthy level started to cause issues.

The point here is that having the best qualified people in the organization provides a capability to deal with both leadership and team changes. Team members need to be capable of and prepared to step in and step up to new roles as they occur. Having well qualified team members provides added strength to the team and the organization as a whole.

As I pointed out, leaders should not only consider the most trained, most educated and most experienced people for their positions. On the contrary, a leader always looks for the best qualified and most talented candidate for each specific position. Being educated, trained and experienced may be an indication of talent but it should not be the only criteria. Having education, training, experience and talent in one discipline, say accounting, does not make that person the best qualified candidate for a role in marketing. However if the role in question was in accounting, I would be hard pressed to agree with any statement to the effect that the person described above was “over qualified”.

Defining Success

I started this topic quite a while ago and put it away as I could not comfortably come up with a method to address the topic. I now have a daughter in college and it seems to have taken on a new life for me.

We all want to be successful and even more so want our children to be successful. I didn’t want this discussion to be purely an analysis of numbers and trends, but rather the relationship to both the opportunity and probability of “success” and more importantly the definition of success. For so long, so many of us have defined “success” as going to school, then going to college, graduating, getting a good job with a major company and going on from there.

Is that really the proper definition of success in today’s world?

We normally associate the attendance of and graduation from college as a prerequisite of success. I was reading an article about relative graduation rates for students in the US who attend college. It showed that the graduation rate could be directly correlated to the cost of the college. That means that the more expensive the college tuition (Private school vs. Public institution) the more likely it was that the student would graduate with a bachelor’s degree in 4 years. I guess that means that if you want to up the odds of your kid graduating from college that you had better send them to an expensive school.

The problem is that they are now all expensive. Very expensive.

It showed that on average about two thirds of students entering a Private institution of higher learning graduate with a degree in 4 years (actual number is 64%), and that about one third of students entering a public institution of higher learning graduate with a degree in 4 years (actual number is 37%). It also shows that the gap closes significantly if graduation data is reviewed after 6 years instead of 4. Private school students hit 3 out of 4 graduating (actual number 78%) and public school students hit 2 out of 3 (actual number is 66%).

Stepping it back a little further, and out of my own curiosity, I looked up the percentage of high school students that graduate from high school and enter college. This number comes in at about 70%. It is interesting that in these difficult economic times that this number is now at its all time high (actually it was set in 2009, but 2010 was at almost the same level). Being something of a math-guy, I multiplied the two numbers together and came up with the fact that less than half the people that go to high school actually graduate high school and college (even after 6 years of college).

Okay, so what.

When is the last time you have hired, or you have heard of someone being hired into an organization without a college degree? If less than half the people entering school graduate college, chances are they won’t be hired by a corporate organization. That doesn’t mean they aren’t successful. It means they are doing something else.

This got me thinking a little bit further on the topic.

I did what most people do these days. I went out and “Googled” the percentage of college graduates that are actually hired into a position that requires a college degree. I make this distinction because some graduates will take positions that do not require a college degree to perform the work (check out the baristas at Starbucks), and others will not find work (check out the “boomerang” kids returning from college to live at home).

As we all might expect this number varies with the status of the economy. In 2006 and 2007 approximately 85-90% of college graduates found work. In 2010 this number dropped to only 56%. 22% of 2010 college graduates took jobs that did not require a college degree. In total 78% of 2010 college graduates found work, but many of them were “under employed”.
That means that of the people who start school, a little less than half actually graduate college with a degree. Of those that graduate college, a little more than half (or a quarter of the total that started) actually find a job that requires a college degree.

A little more research – again with Google’s help, revealed that of those that find work as a college graduate new hire, 46% – again almost half, will leave their jobs (either of their own volition or at the company’s direction) in the first 18 months of employment. The information I found goes further to indicate that while 46% leave, only 19% of those that stay will be successful, with successful being defined as advancing up the corporate chain with increasing responsibilities and a (hopefully) fulfilling career. To me that means that 35% (the 54% that do not fail less the 19% that are actually successful) of college graduate new hires remain employed but are again not what we might successful.

So let’s recap. If we have 100 people who start school, approximately 70 of them will graduate high school. Of those 70, approximately 50 will graduate college. Of those 50 college graduates, approximately 28 will find a job that requires a college degree in today’s economic climate. Of those 28 that have found work, approximately 13 will leave their jobs in the first 18 months of their employment. Of those 15 that remain employed, approximately 5 will be what we as business leaders might call successful.

According to our preconceived notion of success, only five percent (5%) of the people will be successful.

Now I have had to pause here for a while because there are so many different directions that I can go with this type of information and analysis. We can look at the societal or cultural reasons why almost three quarters of those people starting school won’t graduate from college and will most likely be excluded from consideration for positions in our companies. We can look at what causes almost half of those that we do hire to leave. We could also look for the presence of similar characteristics in the successful five percent and see how we might be able to teach and train people on how to utilize these success attributes.

Or we could ask if we have the right definition of success.

The comedian Craig Ferguson had what I thought was an incredibly insightful as well as very funny monologue addressing what he called the “deification of youth” where he noted amongst other things that youth also meant a lack of experience. ( And a lack of experience to me means that you don’t know what you want yet. How can people be successful, when they lack the experience to know what they want to be successful at?
When we judge success we have a tendency to judge it from our own perspective and experience (because we are not young, we have experience), and not everybody has the same perspective. As time passes and we gain more of the “experience” that Craig Ferguson mentioned our perspective also changes. Not everyone who starts school is destined to be a leader in business. Not everyone who plays golf is destined for the PGA, or now senior PGA tour.

Of the two I think it is now the golf one that bothers me most.

Many, simply by the choices that they make will opt to be something other than what “we” may currently define as successful in business. We see this in the generational definitions that are currently in vogue. Generation X, Generation Y, Baby Boomers, etc. all have their own definitions of success. We as business leaders need to understand these differences and try to adapt to them as well as try to adapt them to the goals of business. Not everybody will meet our definition of success, but that doesn’t mean they won’t be successful.

That doesn’t change the fact though, that I want my daughter to graduate from college…and get a good job.

Play to Your Strength

Management hires people to fill specific roles. If you need a sales person, you look for the best sales person you can find who will be compatible with the other personalities on the team and the overall company culture. You are usually not looking for a combination Marketing, Operations, Service, and Software Developing Sales person. Finding a sales person with these additional traits may be nice, but that does not make them the best Sales person. You are normally looking for depth of capability, not breadth of capability.

Each role will require a leader with a specific strength, be it Sales, Marketing, Finance, etc. Understand what your strength is and play to it. That does not mean to ignore the other disciplines. To the contrary, they are important and you should try to increase your capabilities in those areas. You should build your capabilities in your non-core disciplines by trying to surround yourself with people whose strengths lie in disciplines outside of your core strengths.

We all like to think that we have few if any weaknesses. This may be true. The point is that not everything we have is a strength. A little honest self analysis can help each of us pinpoint our strengths. We all tend to gravitate toward people who have similar personalities and interests. This can cause trouble for an organization. Once we are aware of our own capabilities, we should consciously try to look for people with different capabilities and strengths in an effort to “fill in the gaps” in the organization.

President Ronald Reagan was a leader who recognized as a great “communicator”.  He filled out his cabinet with people who were also recognized as some of the most talented individuals in their specific disciplines (Defense, Treasury, Economy, etc) around. President Reagan was a leader who played to his strength – communicating, but hired to his weakness – the mechanics and specifics of running the most diverse and complex country and economy on the planet. Looking back, it worked pretty well. We enjoyed some of the most prosperous times in recent memory. We would do well to learn from that example.