Is Age Discrimination a Result of Change?

A class-action age discrimination lawsuit has been filed against IBM.  Much of the complaints in the action come from a report that purports to outline how the company has systematically replaced older workers with newer ones.  IBM is denying the allegations.

There are a couple of compelling issues here.  One is whether IBM is using sly methods to rid itself of older (read: more expensive) workers.  The other is whether workers who are in mid-career are technologically behind their younger counterparts in a meaningful way.  I’ll leave the former to the courts.  I’m much more interested in the latter.

There are some national studies that indicate that openness to new experiences does decrease with age.  However, the ability to learn does not. So, we can assume that older employees who are open to learning new technologies can certainly do so.

Whether it is how we get to a friend’s house or how we use technology, most of us like to stick to what we know and adapt to change in ways that keep our patterns of behavior.  To keep up-to-date on new technology or techniques not only requires a desire to learn, but also the willingness to give up what we have been good at.

There probably is not data to support the idea, but I am guessing that the hiring strategy at many companies is that they would rather select people who know the new stuff rather than try to train for it. If companies decide that they want to bring on those who have experience with newer technology, their layoff/hiring practices will likely show adverse impact against those 40 and older.

A person’s background is instructive in this area.  For people who have stayed up to date on technology throughout their careers, it is foolish to assume that they will not pick up (or haven’t already picked up) on the next new thing.  As such, I don’t believe that they are behind younger workers.  Senior management would have reason to be concerned about older workers who have not shown a willingness to update their skills.

Are older workers less likely to adapt to new technologies?  On the whole, probably.  However, painting them with a broad brush is likely a mistake.  Companies should do a thorough evaluation of the experienced talent before making decisions that can land them in court.

Leadership on the Hot Fly

If you have been keeping track of the US Open, you know that the extreme heat and humidity has affected the players.  It has also tested the leadership and decision making skills of the tournament organizers as they try to keep the players safe, the competition fair, and the paying customers and TV partners happy.  But, there is a lot of bureaucracy to deal with, too.

The red tape comes from the rules of different stakeholder organizations: WTA (which runs the women’s tour), ATP (which runs the men’s tour), ITF (which runs the Grand Slam tournaments, of which the US Open is one of 4), and the USTA (which runs the US Open).  What could possibly go wrong?

The WTA established a heat policy in 1992 (a 10-minute break between the 2nd and 3rd sets if the heat and humidity reach certain levels).  The USTA has in the past issued heat guidelines for individual tournaments. Neither the ATP nor the ITF have any policies that speak to excessive heat.  However, the Australian Open (another Grand Slam tournament overseen by the ITF) does have one (though not without its critics).  During the US Open, the WTA policy has been implemented and the USTA decided to implement a modified version for the men where there is an optional (at the players’ discretion) 10 minute break between the 3rd and 4th sets.

The USTA showed some leadership to protect the male players and have not received much blow-back for it, other than, “What took you so long?”  Was it the BEST decision?  Maybe, or maybe not—I’m not a physiologist.  But, they made it before someone was seriously injured (or worse).

What I find most interesting here is that there are four stakeholders in running the tournament, but they have not gotten around to coming up with a standard policy to handle something that they have already had to address and is likely to come up again (both the US and Australian Opens are played in the summer).  One can easily imagine other areas where they should be working together (e.g., drug testing and match fixing).

Now, think about your organization.  Are your operational policies consistent across business units/locations where they need to be and also flexible to account for local realities?  Is it clear who makes on-the-spot decisions when these policies do not cover a particular situation?

It is impossible to come up with a policy for every possible scenario.  But, smart organizations develop structures where decision making responsibilities are clear and different parts of the organization can learn from others.  This leads to quicker decision making and smarter operations.

Adapting to Changes in Job Duties

I wrote a couple of months ago about how McDonald’s is changing the cognitive requirements of some of its jobs by adding channels for customers to order food. I argued that such a development should get them thinking about who they hire and how they train new employees.

If you have recently wandered into one of their stores, you probably noticed that, if it is not too busy, a McDonald’s employee may bring you your order. OK, this is not particularly revolutionary. But, to quote a franchisee in an article, “We’re bringing the employees from behind the counter out front to engage, in a more personal way, with our customers.” Maybe I am making more out of this particular example than it warrants, but this strikes me a really upping the customer service requirements of a McDonald’s employee. And I am guessing that a fair amount of the employees are not going to meet it. It’s just not what they signed up for.

This is not about whether McDonald’s employees are capable of providing the additional service or whether their ability to do it well affects the customer experience and/or sales. Rather, it appears to be an example of company changing job requirements and then assuming that people hired using a process that does not account for the new skills will be able to carry out the new duties.

Changing skills requirements is a good thing. It shows adaptation to technology and customer needs and makes the work experience more interesting for people in repetitive jobs. But, companies cannot assume that the incumbents can magically adapt without training and revised performance expectations.

This change also requires updating validation selection processes. Whether it means increasing the weight given to certain aspects or validating a new test, we must adapt our workforce to new job requirements on the front end. As jobs change, hiring practices should as well.

Technology and customers are big drivers of change in the skills, abilities, and personality characteristics required of employees. Smart companies not only redesign work to account for this, but they also update how they train and hire to help their workforce adapt.

Ways That We Punish, Rather Than Coach, Poor Performers

During the 4th of July holiday, I was binge watching an Australian cooking competition show with my family. It was pretty mindless and entertaining stuff. The gist of each episode was that contestants competed in a theme-based challenge. One was selected as the best for the day. Two others were deemed the poorest performers and then they competed to stay on the show. What I found most interesting was that they task they were given to avoid elimination (getting fired) was harder (by design) than the original one.

Of course, there is not necessarily a straight line to be drawn between entertainment shows and the work place. But this did get me thinking about how we develop poor performers. While it seems intuitive that resources spent on improving their performance would have a significant return-on-investment, data show that high performers generally benefit more from training than low ones do.

HR needs to consider how to develop all levels of talent. With the current low unemployment rates, companies are losing some of their control over their talent levels, especially now there is more job hopping. There are a few considerations in developing low performers:

• Are you rewarding progress until the person is capable of delivering results? The key here is that improving performance requires changes in behavior. If they are reinforced, the new behaviors are more likely to be learned. Telling people “try harder” or dangling a future carrot are not good strategies for improving performance.

• Are they sufficiently skilled in the tasks you expecting them to do? Before concluding that the person is not going to be a good employee, be sure that they have the basic skills/experience to perform the job. You should not expect someone to be a pastry chef if s/he does not know how to make a cake. This is where valid pre-employment testing programs are valuable.

• Are there other areas of the business that appeal more to their interests? I have a client that staffs its own call center. They have higher than average turnover in the call center, but somewhat lower in the company overall, because after people spend 6 months there they can bid for any other open position in the company for which they are qualified. Allowing easy lateral transfers helps you keep good employees who may just be in jobs they do not find engaging.

Low unemployment rates mean that new talent is going to be more expensive. It may indicate a good return-on-investment in developing under-performing talent than usual. However, getting people in the right place and having alternate reward strategies are essential to getting the most out of their development.

Bringing the Right Tools to the Table

At some point, all of us are in a meeting where a discussion breaks out over whether a particular business initiative should be implemented. Someone will say, “I heard about it on a podcast/TedTalk,” or “A friend of mine at XYZ company did it and it worked for them,” or something similar. The question then is how do we really know that it will work under a given set of circumstances? While we never have 100% of the information we would like to have before making such a decision, we do have tools to help guide us.

Dennis Adsit and I entered such a discussion about intentionally letting go the bottom 10% of a company’s workforce annually a while back. This was one of Jack Welch’s tactics and it became known as “Rank and Yank” (R&Y). The idea behind it was that the amount of resources spent on better performers has a higher return on investment than putting them towards the lowest performers. After a bit of back and forth, we decided to test this the best way we could. The result was an article in Consulting Psychology Journal: Research and Practice.

There are two main takeaways from the article:

1) Under certain circumstances, R&Y may be a very viable option for improving organizational effectiveness. Dennis summarizes this well in this post.

2) When management comes to your team with “I’ve got a great idea…” you must be prepared to develop an analysis to respond to the request. It is this that I want to address a bit more.

People sometimes confuse having all of the information and having an evidenced-based recommendation. In our paper we simulate an outcome based upon a set of assumptions. We talked quite a bit about those assumptions before we accepted them. There were also cases where we thought different assumptions were important, so we ran the numbers under different conditions. This allowed us to draw better conclusions from the data.

In the article we chose to model call center agents for several reasons. Among them were that we knew from experience with clients that their job performance (after training) is consistent on a week-to-week and can be measured objectively. This helped in estimating the impact of turnover. But, we also found that others had measured the “softer” costs of turnover on agent performance. This served as an excellent reminder that with enough diligence and care there are many aspects to productivity that can be measured, but that are not. HR brings a lot of value to table when it rolls up its sleeves and digs into these issues.

It did not really matter than we chose to simulate the effectiveness of R&Y. It could have been a selection system, a management development program, or a training class. What is important is taking the time and effort to listen to others and work through the data. That allows HR to have significant value and impact.

Even in Business, No Good Deed Goes Unpunished

We are in an era where many businesses feel that they must project an image of social responsibility. This may be driven by management’s true desire to be a force of good, a competitive advantage, or as a way to attract millennial job candidates. Being perceived as being on the “wrong” side of an issue can have significant effects on consumer oriented businesses (see Chick-fil-A or Facebook). But is the impact of this corporate behavior?

There many consequences of a firm demonstrating social responsibility. These include:

1. Being socially conscious doesn’t really help sales. This is probably because just about every company promotes social responsibility in some way, so there is not much variance.

2. Companies that promote how socially conscious they are get more job applicants, particularly women. This makes sense since millennials are drawn to companies that share their values.

3. Those who apply for work at companies that promote socially responsibility are more productive than those who apply at companies who do not advertise that they are socially responsible.

4. Those who work for work for socially conscious companies are more likely to steal from them.

Wait—what’s that with #4? People who are generally more willing to work for a socially conscious company are more dishonest (steal, slack off, etc.) than other employees? Not quite, but when people do good things they sometimes feel as if that gives them a license to get away with stuff. Keep that in mind next time a leader of an organization that thinks it has a high value to society (religion, journalism, etc.) gets caught engaging in some pretty awful behavior.

So, if you are a company that wants to promote social responsibility to attract more productive workers, but you don’t want the bad stuff that comes with it, what should you do?

1) Reduce the amount of social responsibility messages after people have been hired. Once people are onboard, you don’t need to keep talking about how much good the company does—they get it. The continued presence of these messages makes moral licensing more prevalent.

2) I would assume that there are individual differences when it comes to moral licensing (most likely related to conscientiousness). And it so happens that conscientiousness is one of the personality variables that generally predicts job performance. So, it would be valuable for socially conscious companies not to take it for granted that their candidates are all good people. Rather, a validated test would likely help them select those who are less likely to look for an excuse to slack off.

Many business choices have unintended consequences. Being overtly socially conscious apparently does as well. However, companies can mitigate those consequences with some good planning and employee selection practices.

People–Can’t Profit With Them, Can’t Profit Without Them

So, in the same week that Tesla says that lack of people is a problem in their business (too many robots!), Starbucks comes to the conclusion that people are biased and are hurting its business, everyone gets training. So, which one is right?

Let’s start with Tesla. Their statement is not as much about how wonderful people are as it is that they haven’t quite (yet) gotten the engineering down for their new cars to be built completely by robots. So, it is not exactly an “Up with people” moment as a “Well, we guess we have to put up with them for a bit longer” one.

The Starbucks situation is a bit stickier. On one hand, they clearly felt as if they had to do something after a horrible incident involving African-American customers to maintain their brand image. But, I think they are setting themselves up for failure. Implicit bias training is well meaning, but correcting a lifetime of assumptions about people in a ½ day seminar is a pretty tall order. What will they do next time a racially tinged incident occurs? Do a full day of training? Validate a test that predicts levels of implicit bias?

Where I think the training will have the most impact is on their new hires. It sets a cultural norm of what is and is not OK. Yes, this will require management support and some way of recognizing employees for being decent human beings. But, in reading the comments on their social media pages after the announcement that may not matter as a lot of people were pretty bent out of shape of having to go one whole afternoon without their Starbucks. Ah, the downsides of selling a legal, but addicting, product.

Service sector organizations will always face the challenge of directing the activities of people in a way that is consistent with their values. Manufacturers are always challenged with introducing technology (which improves efficiency), but also understanding its limits (for now). We are not quite at a point where people can be engineered out of business. So, we still need to lead them in productive ways.

Can Tech, Workers, and Burgers Co-Exist?

One purpose of technology is to make labor more efficient. This was not news to the inventor of the first wheel or the latest and fastest micro-chip. Western society has been pretty comfortable with this because it really makes things go faster and has eliminated some very physically demanding jobs. Of course, tech also creates higher paying jobs (though not as many) than the ones that get replaced. But, where do customers draw the line?

This article describes the effect that tech is having on McDonalds. Note that this is the only description of the issue I’ve seen online, so I’m a bit skeptical of the premise that this is the reason people are quitting work at McDonalds at higher rates than before, especially considering the low unemployment rate. There are those who think that this kind of automation is being driven (or at least accelerated) by local minimum wage increases. However, automation has always been designed to reduce labor, so that’s not a big surprise.

Yet, Walmart is appearing to be having the opposite experience with tech in its stores. I think the big difference is that the impact of the technology there is to allow employees to focus on what they already do well rather than leading to a change in necessary skill sets.

New tech always has growing pains and I am sure that fast-food chains will get this figured out pretty quickly. The bigger questions to me are:

1) Whether they will understand that they have changed the cognitive complexity of the jobs, and therefore need to change their hiring practices.

2) If service is really part of the equation for fast food customers.

When you change tech in any job, you need to change organizational behavior to adapt. Part of this equation is training, but the other half is ensuring that your selection systems are still valid. This change has led to an increase in behaviors such as quickly shifting between ways people can order while maintaining attention to detail. This requires a somewhat different skill set than handling one order at a time using one process. The tech won’t work as well if you do not have the people who can run it correctly.

As for the second question, the U.S. economy is filled with examples of service employees going away. Whether it was the transition away from pumping your own gas to checking out your own groceries, we are pretty good at serving ourselves. This leads me to believe that the increasingly automated fast food restaurant will be here more quickly than you think.

Does Kindergarten Really Have a Culture of Success?

You may be familiar with the marshmallow challenge. It is an intriguing and engaging team building exercise that demonstrates the importance of failure in group interactions.

It is all fun and everyone gets a laugh regarding how, according to an accompanying Ted Talk I show, kindergartners do better at it than those who went to business school. By the way, I’d like to see that replicated because it makes a great story but I doubt that it is really true. But the most important lesson for leaders from it is not that failure eventually grows success. Rather, it is the call to action to create a culture where taking the risk should be rewarded and not only when the risk leads to immediate success.

What leaders should learn from the challenge is that it takes place in an environment that encourages risk taking. There is no one to say, “Let me tell you how we’ve done this before” or “If this doesn’t work out well we are in big trouble.” From this culture, most teams are able to accomplish something that at first seems unlikely in about 18 minutes. This should lead to a candid conversation about the barriers that exist to useful failure and what actions can be taken to change those aspects of the culture.

The nature of kindergarten is to reward process more than results. Incentives in business cannot be quite follow that model and lead to success. However, we can use learning to find the unnecessary hurdles creativity and problem solving.

What Do Grades Tell Us When Hiring?

Welcome to 2018! This first link actually highlights a look at valid personality testing on a largely read website. This makes me think that the year is off to a good start in the field.

Along those same lines of predicting behavior, a line of thought has always been that school grades are indicative of future success. The logic behind this makes sense. If a student applies him/herself and does well in school, then it is likely that he or she will do the same at work. Critics will say that grades measure something very specific that does not really translate to work and there are biases in how grades are given (which is why universities use standardized tests).

As always, what makes a good predictor really depends on the outcomes you are looking for. If your goal is to hire people who are good at following rules and doing lots of things pretty well, then this article suggests that school grades should be part of your evaluation process. But, if you want to hire very creative and novel thinkers, then GPA probably is not your best answer.

What also grabbed me about the article was the definition of success. The research article cited indicated that those who did very well in high school, nearly all of them were doing well in work and leading good lives. But, for the authors, this apparently is not enough. Why? Because none of them have “impressed the world,” whatever that means. And because there are lots of millionaires with relatively low GPAs (here is a suggestion: how about controlling for parents’ wealth before making that calculation?).

From an employment perspective, we need to be clear what valuable performance looks like when validating and part of the selection process. If your goal is to select people into positions that require developing unique solutions, then GPA may not be a useful predictor. However, if you expect people to follow processes and execute procedures, then GPA is likely to be a useful tool which should be used with other valid predictors.

And, if you are looking to hire people who are going to “impress the world,” good luck to you.

Thanks for coming by!

Please provide this information so we can stay in touch.

CLOSE