Bruce Poon Tip: Hire Slowly, Fire Quickly
As I mention in Looptail, every one of us knows doctors who look at their work as a job. And everyone knows school janitors who they grew up with who looked at their job as a calling, taking care of kids. They were so happy doing what they did. And it doesn’t matter what you’re doing, it just matters on your mind-set of your purpose in life.
You talk a lot about the importance of employee loyalty. But how can a real estate broker generate employee loyalty when most sales associates are independent contractors?
It’s all about engaging people beyond your product. No matter what business you’re in, you have to engage your customer as well as your employees beyond what you do. Most businesses today want to engage people or try to motivate people based on money, and there are so many studies that have shown that doesn’t work. I think the rise and fall of Wall Street is a great example of that. I mean, people have to be fairly compensated, but it’s not the only way to engage people. And when you do engage people with just money, it’s a dangerous slope because there’s no loyalty. But when you really build a business model around your purpose and you transcend what you do and build something that people want to be part of, its more like creating a movement and being part of something greater than one’s self. That’s when you get all the great things that businesses want. You attract the best people, you get retention, you get loyalty, and you get all those things that people can’t put a finger on, but that all businesses want. And that’s when it starts paying dividends, too. That’s when it starts affecting the bottom line.
That’s an interesting concept. By not focusing on money as a motivator, you can actually affect the bottom line of your business in a positive way.
Yes. There are common threads with what people want in their businesses. We all want the best people. We’re all competing for the same people in crowded spaces. We all want staff retention; we want loyalty. And then we want people to be passionate about delivering on our brand promise. And you put all those things that we’re all searching for together, money comes after. There’s a side of my business that gets at the karma of business as well. If you get everything else right, the growth numbers and the profitability will fall into place.
We’re certainly a prime example of that, because once G Adventures got the business culture side and the back end of our business right, we grew more than we ever had and we’ve been more profitable than we ever have. And we did that all through recessionary years.
How do you give managers and leaders a sense of autonomy and ability to make decisions on their own but keep them from turning their individual departments into independent silos? As someone who has a lot of employees all over the world, how would you recommend owners and managers strike that balance?
Companies spend most of their energy managing their bottom ten percent, their most difficult employees. I think that’s the biggest problem that we have in the corporate world. Most human resources practices are set to create rules and create systems in order to deal with the lowest-performing people in your organization. Small entrepreneurs and businesspeople can actually start managing their businesses from the top down as opposed to the bottom up, where they can recognize their top-performing people and not be ashamed of it. Most entrepreneurs like to create these flat organizations because they want everyone to feel equal, but there’s nothing equal in performance. It’s the hard part of happiness, I always say: managing people, hiring slowly, and firing quickly.
You have to acknowledge your top performers, but it’s not just on numbers, by the way. People have to contribute in various ways to be at the top of our company. One of the biggest things is contribution to culture. It’s not just people who have the best numbers. We’ve gotten many people who we call “brilliant jerks,” people who are great with their numbers but who don’t contribute to the company culture. And those types of people are the most difficult for business owners to manage.
So, it’s how you manage people, its how you blatantly identify your top performers based on a certain set of criteria that contributes to your business culture as well as your financial success.
And then, how you manage the bottom ten, spending less time. With us, for those bottom performers, it’s either