Can we Predict Karma in Applicants?

We would all like to think that doing well towards others will benefit us in this (and future?) life.  At the same time, capitalism can encourage some people to act entirely in their self-interest in order to get ahead and create efficient organizations.  So, should we hire good or successful people?

Altruism is a part of the “Big 5” personality construct of Agreeableness.  In business settings, we would consider it how much a person makes other feel welcome versus looking down on others.  Agreeableness has been established as a reasonably good predictor of job performance.

In this study, researchers dug into altruism and how it affected life outcomes, including income.  There are two things that I found interesting and useful about their results:

  • We should not be surprised that altruism leads to financial success in environments that involve teamwork. Working with others is about making 2+2=5 and people need to be willing to think about others to make that happen.  It is important to note that this research did not look at specific occupations.  One can see how altruism would be a bigger plus for some professions (health care) but not in others (sales).
  • Generally, the results showed a straight-line relationship between altruistic motivations and income. However, when looking at altruistic behaviors, there was a point where there could be too much of a good thing an income went down among those who reported the most altruistic behaviors.  This is important from a selection perspective because if you were to use a personality measure (Compared to most people I know, I am very altruistic.), you would want to score it as higher is better.  However, if using a biodata approach (How many times have you given your time to someone else in the past year?), then a curvilinear scoring may be more accurate.

Of course, deciding on any pre-employment screen first requires a good job analysis first.  This study provides an interesting window into how one sub-facet of personality can potentially be predictive of important job behaviors.

It also reminds us to look at the value of pro-social behaviors in the workplace and look for opportunities for employees to do them together.  It builds a culture of altruism that may also lead to greater business success.

Just Give Job Seekers the Information They Need

I’ve written in the past about ensuring that job postings are free from potential discrimination. But, summer is also the time when we think about internships and attracting early career talent. No, this is not going to be a screed about millennials and their work ethic. Rather, I will ask you to consider whether your job postings are appealing to them.

This article encourages employers to be direct, rather than using jargon in their postings. More importantly, and in contrast with the stereotype that younger workers are looking for things that are flashy, the more effective ads had basic information. Apparently, listing things like salary ranges, location, and the company’s mission is important. Who knew?

What is effective in marketing, which is what job postings really are, changes regularly. So, what works now may not work in 12 months. Fortunately, this is a data-rich environment, so there are things you can do to measure the success of your postings:

1) Experiment with language and see which versions attract more interest.

2) Get input from recent hires on the content of the ads. This will help keep you current as to what job seekers in a specific demographic are looking for.

3) Your ATS probably does keyword searches on resumes and your social media likely relies on keywords, perhaps those same ones, to show up in better places on the web. Measure whether those keywords are attracting the people you want to reach.

The message here is really not to get overly cute or overthink job postings for entry level positions or internships. If you are direct and provide the job seeker what s/he is looking for, you are likely to attract more interest.

Another Step Towards Engaging Millennials

When writing previously about employee engagement, I discussed how companies can encourage employees to be engaged by taking steps to connect them with the organization.  We also know that, as a group, millennials tend to look for ways to connect with their employers and co-workers in ways that go beyond whatever product or service they are delivering at work.

This article describes a start-up that provides experiences for groups of employees to help encourage engagement in a way that is enticing to millennials.  This includes unique experiences they can together and being involved in community service.

Of course, this type of thing is not brand new.  Companies have been involved with stalwart social service organizations like United Way and Red Cross for many years.  But, I think it is fair to say that millennials are looking for something a bit more active than fundraising and giving blood (both worthy endeavors, by the way).

Companies do not need to outsource their engagement activities and management can brainstorm things that would appeal to their employees and fit with their culture.  But, this does show how companies are trying to get younger workers more engaged by experiencing intrinsic rewards (feelings of accomplishment) rather than extrinsic ones (here is a thing for doing well).  It also underlines how it is important to proactively create engagement you want to improve teamwork and reduce turnover.

Higher Minimum Wages and Success in the Hospitality Industry

The state of California and several of its cities have been on the forefront of raising the minimum wage.  The arguments for (people cannot live on the current minimum wage) and against (it will cost jobs because business will need to lay people off) it are familiar.  But now there is some data that makes a very interesting link between quality and the impact of raising wages.

This study looks at the impact of raises in the minimum wage and restaurant employment in the San Francisco Bay Area.  Don’t be fooled by the academic nature of the paper—the authors do a good job of explaining things in English before digging into the math (though you can get another explanation here with an eye towards the political).  The main takeaway from the article is that well run restaurants (in this case, defined by high Yelp ratings) are not impacted by minimum wage hikes.  Crappy restaurants (based on quality, not menu price) saw their already higher closure rate go up with the increases.  So, what does this mean for HR?

  • Well run businesses can absorb higher wages when their competitors cannot. This may mean higher prices (in some instances people will pay for quality) or that these businesses can survive on lower profit margins.  HR can contribute to this through good hiring (brining in people who can deliver high levels of customer service) and training (developing a learning culture) practices.
  • Use data to improve quality. The study shows that online feedback (in this case, Yelp reviews) is strongly correlated with business success.  This customer input should be used to improve service and quality.
  • If we presume that the vast majority of the workers at the restaurants are at minimum wage (as the paper does), this research tells us that paying more is not an indicator of quality or success. If restaurant A is getting a rating of 5 and restaurant B is getting a rating of 3, it is not due to wage differentials.  Rather, it is likely based on the quality of the product and the level of service.  HR may not have much impact on the former, but it certainly does on the latter.

What the paper really tells is that that business can succeed without necessarily being the one that pays the highest wages.  When wages are held constant, hiring the best people from the available labor pool may lead to higher service delivery.  This, in addition to a good product, can keep a business successful, even if wages are forced to go up.

At Least All Employees Get Treated Poorly

For the life of me, I cannot understand why some companies go out of their way to treat their employees poorly. It starts innocuously, like putting employees last in a mission statement. Then it morphs into thinking that people are really machinery (scientific management to the extreme) or a cost center rather than the deliverers of service and product excellence.

Our first example comes from companies that hire low-wage earners. Employers cutting peoples’ hours to avoid paying for benefits is nothing new, but the Affordable Care Act gives them another excuse to do this. And guess what? Many regret it because of the unintended, but obvious, consequences. You cannot say that you want to deliver great value to your customers while at the same time giving your employees lots of reasons to be unengaged. How can you expect people to show up on time and work hard when you keep their hours low (at a poorly paid job) to avoid paying for health insurance (or some other benefit)?

But, it is not just those at the bottom of the economic ladder that get poor treatment. Yahoo, which is getting its clock cleaned by its competitors, implemented a quarterly ranking system of all managers. You may be saying, “But, isn’t frequent performance management a good thing?” Well, yes, it is. But, Yahoo implemented a forced-ranking system on a 1-5 scale.

The forced ranking system where managers have to place people into “buckets”: 10% in “greatly exceeds,” 25% in “exceeds,” 50% in “achieves,” 10% in “occasionally misses,” and 5% in “misses.” To their credit, it’s not quite a bell curve, but the focus is clearly on the distribution of performance and not the performance itself. I consulted for a company that used a similar system and it made almost everyone miserable. You know who hated it the most? Those in the “exceeds” category, because they all thought they were in “greatly exceeds” and resented not getting the benefits (additional training, etc) that went with it. Those in the lowest bucket pretty much knew they were already there.

There’s a long list of companies that have abandoned this type of ranking system (Microsoft being one), yet this type of flogging continues to exist. I get the theory: We need to identify and fire poor performers as they are a drag on our business and we need to identify or best talent and develop them. But why the ham-fisted approach? Good performance management is about defining performance goals with the employees and measuring job output against those standards. Everyone can succeed or everyone can fail, but at least people are judged against their performance and rather than an arbitrary distribution.

Companies have to compete for top talent and a great culture is a great way to attract and retain productive people. Employees want to work in a place where they are engaged. Yahoo is saying, “Come here and be innovative while we constantly compare your performance against others in different jobs.” Not exactly a great pitch. Some restaurants are saying, “We don’t value you enough to pay a competitive wage (unless forced to by law) and we’ll cut your hours to save some additional money. But, please work hard and please our customers while you are here.” Not exactly a great way to deliver great service and keep turnover down.

Whether an HR employee or a consultant, our role is to show leaders the value of employees and the value they bring to a company. We should be fighting efforts that treat people like a cost.

For more information on effective performance management, contact Warren Bobrow.

 

 

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