Every month, whether or not you’ve made your numbers, you have to cut checks. I’m sure you’ve all heard the term ROI, return on investment, but what about Return on Payroll? If payroll is your greatest investment, shouldn’t you have a strategy in place to increase your return? How can you be sure you have the best team in place and that they are working to their fullest potential?
According to Jim Collins, before deciding which direction to head in, you need to have the right people on the bus and in the right seats. Many CEOs I speak with think strategy is their biggest problem. In actuality, it’s people. The CEO can’t be the sole contributor to the company’s direction and strategy; you need a strong team of “A” players to challenge your ideas and contribute new ones.
When you have the right people in the right seats, strategy should be the easy part. Finding and determining who your “A” players are is the hard part.
Hiring is a tough and often a long drawn-out process. Sometimes it can feel like you may never find the right fit. Especially if you’ve made a mis-hire in the past, you may be more hesitant to make a decision knowing what it might cost you. Based on research by Dr. Brad Smart, one of the founders of the Topgrading hiring method, a mis-hire can cost you up to 15 times base salary for a managerial position. The brutal truth is you will never know for sure whether or not you’ve made the right hire, until you spend time working with the person. However, when you use the Topgrading method, you can be 90% sure, based on my experience recruiting for Rhythm Systems and our clients.
The Topgrading method is a comprehensive interview process, far more revealing than a basic competency interview, that encourages candidates to be very open and honest, which allows you to see patterns in their decision making, educational history and work history. Our goal in using the Topgrading method is to only hire “A” players. Existing “B” and “C” may need coaching and assistance to make their journey towards becoming “A” players. They might have the wrong role in the company, or they might need intentional and purposeful coaching. If you cannot improve their performance and enjoyment with your company after trying hard, well… it might be time to free them up to the economy. There might be a better fit for them somewhere else. I believe anyone can be an “A” player at the right company for them, where there is a good match in core values and job requirements.
So, where are all the “A” players and how do you find them? First you need to decide what you are looking for by defining your own “A” player based upon your needs and core values. Once you know who you are looking for, use your network to conduct your search. Topgrading suggests getting referrals from your top performers. Since “A” players like to work with other “A” players, encourage them to give referrals. Some companies find giving a referral bonus helps employees keep recruiting top of mind, so when an “A” player comes around they remember to refer them. It may seem like a lot of money, but you’ll save in the long run if you don’t need to use a recruiter and you find the right person.
Now that you’ve got everyone on the bus, you need to keep them there! If you want to retain your “A” players, you’re going to need to invest some time developing them, or else they will go on to find a more rewarding opportunity. Start off by having a Great First Day and continue to connect on their progress regularly. Depending on the size of your team, I recommend having a weekly or monthly one on one meeting to discuss their growth and future goals. “A” players don’t need to be over-managed, but they do need a clear description of their role and expectations. They are passionate about the company and their work, so explaining the reasoning or strategy behind it can help to increase results and further development.
You may have the right people on the bus, but you also need to make sure they are in the right seats. A “B” player in one role could be an “A” player in another role. Observing strengths, connecting on a regular basis and asking what they enjoy doing can help you to guide people to the right seat.
“A” players are hard to find, and even though they are “A” players, you still need to put energy behind developing them, but in the long run your investment will be well worth it. If you take time to focus on increasing your Return on Payroll, you’ll be on the road toward achieving breakthrough execution and accelerating growth!
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