Finding Good People? – March 2009
Finding good people is only the first half of the challenge
of hiring good people. In most cases, we have found that
the
issue is not finding good people, but attracting good people.
How often have you asked if your best employee had a twin
sister or brother at home that you could hire too? What if you
could set higher standards and attract employees as good as
or better than you best current employees. Would your business
grow and become more successful? Would your business be easier
to manage? Would your customers become more loyal?
Why bother?
Most of our businesses rely on our customer’s relationship with our staff. We are in effect selling our staff to our customers, because if our customers don’t like our staff, they will not buy our products or services. It follows then that if we have better staff, we will have better sales.
By using the Customer Ladder, we can identify the importance of our staff on growing any business. People generally start out on the bottom rung as Prospects and then rise to Customers, Clients and ultimately Advocates of our businesses. In a restaurant, to convert a Prospect to a customer (someone who does at least part of their business with you), usually takes an interesting menu, a pleasant host and a readily available table. So even to generate a Customer takes good staff unless it’s 4:00AM and yours is the only drive-thru in town.
To convert a Customer to a Client (someone who does all or most of their business with you) takes a lot more than a good menu or décor, it takes a great relationship with your staff. For a Client to become and Advocate (someone who actively promotes your business to their friends, family and contacts), requires trust, confidence and goodwill between your staff and your Clients.
How much would your business grow if you could promote 10% of your current Customers to Advocates? How many new Customers would you have with 10% more Advocates? What would it cost? – Not much!
• If you are a Waitress, your cost to build more Customers into Clients and Advocates is mainly your time and taking a genuine interest in them.
• For restaurant owners, the difference between the lowest selling and highest serving Waiter or Waitress is $500.00 per shift; at a 50% margin the higher selling staff are worth over $200.00 per shift more to your business but their wages may only cost $1.00 to $2.00 per hour more, if that.
• Suppose you are a Product Distributor and your lowest paid Sales Rep is at $60.0K with your highest paid Rep at $92.0K, each with bonuses, car allowance and commissions. If your lowest paid Rep manages a $1.0 million territory and your best Rep manages a $2.5 million territory: it would take two and a half Reps at $60.0 or $150.0 total to manage the same amount of business as your one $92.0 Rep.
A recent US study by Investment Banks found that when a Financial Advisor left the bank, about 30% of their customers followed the Financial Advisor to the new bank. Loosing good people is expensive!
Finding better staff starts with two steps: 1) setting Higher Standards for all of your staff and 2) Daily Prospecting. In challenging times when spending is tight and average staff or average competitors are plentiful, it becomes even more important to have the best staff to be more competitive.
I recently saw a Mission Statement posted at a local airport service counter that read: ”Our objective is to not just to meet, but to exceed our customers expectations.” Set higher standards. As I interviewed the manager of the business, I found that they made a point of requiring two training certificates for every employee. They were also strict about good, complete, and clean uniforms (self-esteem). These items were the same ones that their competitors were lax about. The higher standards showed in the service, skill, confidence and the attitude of the employees.
Several famous people have authored quotes about finding who your best competitor is and copying them. A few years ago I worked with a McDonalds franchisee in cottage country, who took his family out to a different competitor’s restaurant every Tuesday night for dinner. It was his discreet way of observing their service, staff and ideas, both good and bad. It also allowed him to be a part of the community and to get to know (and observe) his competitors in a non-threatening way.
If you set higher standards, you will attract better people because performers want to be known as working for the best. In the book “Jimmy” (the autobiography of Canada’s West Coast, Jimmy Pattison) there is a section describing how Pattison grew his used car sales team by firing the lowest sales performer every month. (Not a tactic that we would recommend) The word and reputation spread quickly that Pattison only kept top performers and therefore if you were a top 5 sales rep at Pattison you were obviously one of the best. Set higher standards!
Prospect everyday! Over the past several years of hiring and dealing with hiring managers, the most consistent hiring issue has been attitude, not skill. If you are looking for a great Chef verses a Cook, skill is an important issue. If you are looking for a great hostess, waiter, sales rep, manager or delivery person, you can teach the skills, hire attitude. Two weeks ago “Tanja” at Petsmart did an outstanding job of helping my son replace a dead gold fish. If any waitress served me that well I would have given a generous tip. Watch for the best people everywhere you go and steal them to come and work for you.
The Airport facility mentioned earlier hired staff from a wine shop, a dance teacher, a co-op student and an ex-policeman, and then trained them in aviation. Only 5% of all Sales Reps really enjoy selling, find them and steal them. Their enthusiasm and success will be infectious with your staff and customers. Prospect everyday!
If you set high standards, replace poor performance and hire great attitude; you will be surprised how quickly you can see the impact on your business results and your ability to attract good people.
We invite your ideas and comments to Wayne Wayne@Derhak.com,
or call (416) 675-7600 ext. 209.