Published in the San Diego Union-Tribune, May 1, 2018
And so this week, more tales from the trenches.
How does it happen that you get blindsided by a terrific employee who comes in one day and says, “Adios, got a better gig and I am outta here in two weeks?” In my coaching I have recently seen instances of this unexpected/surprising turnover. The question is: Did the CEO see this coming, and if he did, what steps did he take to counteract it? If he didn’t see it, why not? Remember, my basic premise here is that the employee was terrific and you did not want to lose him/her.
Each story is different, but there are a couple themes. Numero uno is for the CEO to clearly understand the cost of turnover. Statistically, it is about 20 percent of that person’s annual salary (in jobs under $50,000 per year), but the cost in information transition and replacement for the more highly compensated worker is much higher. A study by the Society for Human Resource Management puts the true cost to replace someone earning $100,000 at six to nine months of their salary, or about $60,000, so keeping good people is really important.
The skill set that I preach to my CEOs is to learn how to listen. This skill is not about hearing the words. The skill is about understanding what is not being said. Along with that skill, I argue for empathetic listening, clearly showing a compassionate understanding of the issue. Again, this skill is not an obvious one, particularly in entrepreneurs who come from science and engineering. They know what they know. They have learned that hydrogen and oxygen makes water, and there is very little room for the nuance of mist versus rain.
I also talk to my clients about learning how to be “touchy-feely” without appearing to be a wuss. Finding the balance between being CEO/Captain Fantastic and the soft skill of “care and feeding” is hard. And today, the reasons for employees leaving are multilayered, from boredom to toxic culture to blocked opportunity to sexual harassment. Bottom line is that insensitivity to “that stuff” is expensive.
I recently learned a lesson where I had given some bad advice (yes, strange as it may seem it does happen). The client did not have a good spot for a very talented fellow, and I said that he should let him go, since the overhead was high and there was no clear path forward. The client pushed back and said “I am going to keep paying him, it’s hard to find another guy with his talent, and something will turn up.” And it did. My advice was too precipitous. I was reacting to immediate burn rate and overhead without fully understanding the ability of the employee if something in his sweet spot appeared.
Stuff happens, and there is a new big deal where this guy is the key driver and the deal could not happen without him. So, the puzzle here is one we have discussed in the past — the word “when.” Not so easy. It worked out this time, but what if a year had passed with no place for him? So the question is an old one — how long before you pull the trigger? If you fire too soon, you may kill someone or yourself.
Finally, my trench this week was filled with a terrific fellow, who has traction, has revenue, has a real chance and owns 100 percent of the company, with his family as the only employees. To grow (and take in outside capital), he needs to let go and hire a real team. Wow, this story has only been told slightly less than the Bible. The key here is that he exhibits what Carter Cast, professor at Northwestern University, calls “The Whirling Dervish syndrome.” He is filling orders at 3 a.m. in his garage, and in so doing, never has the time to step away and think. The company is running him rather than him running the company. Letting go so you can have more is one of my favorite Zen discussions.
In the final analysis, it is all about accurate self-assessment and self-awareness. That is why God invented psychotherapy.
Rule No. 558: Come swim with me in the Mariana Trench, 36,000 feet deep.