Service sector executives I’ve spoken with lately are concerned more about talent than anything else… anything. Talent, as in finding, optimizing, developing, affording, communicating with, providing healthcare for (or not), and hanging onto it.
With the concurrent tightening of the U.S. labor market, marginally pre-emptive wage hikes by major employers at the low and mid-tier pay scales (e.g., Wal-Mart, McDonalds, Aetna), and slow but continuing business expansion in most sectors, for the first time in a long time, managers find themselves reacting defensively to labor market forces. Witness the facts that:
- Businesses with meager workplace reputations, or that were a half-step slow, (or too timid) in adjusting pay rates are finding themselves forced into the sub-prime talent pool… a place that heavily talent-dependent companies really don’t want to be.
- The time required to fill vacant positions is ballooning across most industries as recruiters must scramble and adapt for the first time in quite a while. Indeed, much of this piece is being written at a resort property where better than 8% of their total positions are open, with recruiters actively pursuing candidates for about 120 staff vacancies. Each day that passes with those jobs open leaves other staff a little more weary, and guests possibly not getting a full measure of what they came (and paid) for.
- Incumbent employees are jumpier than ever, distracted by the plethora of emerging job options, and less engaged, as in feeling connected to their jobs, than at any time in history (really).
As an example of the last point, I recently made separate calls to the corporate premium level guest services line, and a property-level guest services agent of a leading, well run hotel company. In both cases, my request was simple and straightforward. In the first case, after booking a room for the night in Nashville, I asked that the reservation be texted to both my wife and me, since we were traveling separately to the hotel.
The second request would have involved having someone from the hotel property walk (or phone) across their lobby and retrieve something from the rental car desk located less than 100 feet away, in the same lobby.
Both requests were responded to with words to the effect of “I can’t”, responses that to this road warrior sounded a lot more like, “I won’t, or I choose not to”. And thus, the slippery slope of declining effort, performance, and eventually profit begins.
Where is all of this going?
In any industry where one of the key competitive differentiations is service, delivered largely at a person-to-person level, capturing the discretionary effort of each and every member of the workforce is of paramount importance. Discretionary effort stems from a quiet, conscious, internal decision that each of us makes daily to either expend or withhold that extra morsel of effort. It’s great for customers and shareholders, and bad for competitors.
What to Do?
So, if you are one of those who has recently turned over in bed an extra time or two at night wondering and worrying about talent issues, what should you do? Here are a few thoughts for getting out of the defensive crouch and acting more confidently and pre-emptively:
- Identify your best leaders, key hourlies, hi-po’s and have meaningful conversations with each of them about why they stay with you, and what they would like to have more or less of in order to feel good about their station in life, and do their very best work. Let them know that they are special – not privileged, special, and that you care about them. I’m fairly certain you’ll find those conversations productive, and well worth the effort.
- If you’re not already Committed (capital ‘C’ intentional) to learning and development (L&D) as a business strategy, and a means of differentiating your product or service, get that way. If you can’t enumerate your organization’s top three L&D priorities off the top of your head, and explain with a crayon why they’re so important, or state how much you’re currently investing on learning at the business unit level (plus or minus 5%), you’ve got some catching up to do! By the way, in most cases, strengthening the leadership bench is (or ought to be) uppermost among those priorities.
- Start dealing quicker with misfits and people who can’t or won’t perform. It’s cruel to do otherwise. Most often, a person who is failing or in the wrong job knows it. They just don’t know what to do about it yet, or are frozen by fear or economic necessity. Ignoring these situations is equally unkind to customers and co-workers. A-players don’t like having to work with, let alone prop up turkeys, and customers certainly aren’t paying for subpar performance.
- Make worker engagement a core aspect of your business metrics. Survey regularly for it, follow the surveys up with meaningful feedback and action planning, make it part of your rewards structure, and hold people accountable for their results across time. Like color Doppler radar, this is one of the most predictive tools you’ve got. One of the best CEO’s I know recently shared with me the fact that a backward look at both manager successes and failures in his organization suggested that almost all were foretold by their employee survey.
- With regard to rewards, one powerful way to get managers to perform across the full breadth of their responsibility and at the same time tear down silos is to establish People, Service, and Profit hurdles as a pre-condition to corporate (or business unit level) bonus payouts. In other words, the company’s owners might enjoy an outstanding year profit-wise, but if that achievement came at the expense of employee relations or customer service, nobody, repeat, nobody gets a bonus. Same thing if the customers and employees are both happy but the shareholders aren’t. Having worked under such a scenario, I can assure you that it quickly focuses the mind (and effort).
- Improve your recruitment processes – really improve them. Too many of our methods are still burdened by the arrogant notion that, “we’ve got what they want so they (applicants) have to play by our rules.” Wrong! Think again about the war for talent that’s raging outside your window. Think, too about the fact that the average consumer is walking around with multiple mobile devices that they are perfectly comfortable using. Why, then do we make it so danged difficult to job search via a mobile device? Recruiting via mobile needs to be a NOW (not someday) capability. Why is it that we all continue to proclaim that, “People are our most important asset” and yet we do so little to teach managers how to more effectively source, screen, and select talent? Why in the world do we treat applicants so shabbily? Do you have any idea what that does to your employment brand? Why is a manager’s selection track record almost never a ratable factor? Why is it that we treat our recruiting efforts like a light switch, turning them on and off strictly on demand? Not unlike a sales rep who chooses to prospect only when the till is empty, a recruiter who is active only when she has signed reqs in hand will fail.
- Finally, stop whining about how difficult performance reviews are and make a concerted effort to improve your own coaching and feedback skills, and then show your team how it’s done, first hand. Most of us would still rather see a lesson than hear one.
Whatever you do, get busy now, because time is not your friend. Good luck. I hope to see you somewhere down the road.
Bill Catlette is Managing Partner at Contented Cow Partners where he strives to develop stronger leaders by connecting the dots between People, Passion, Performance & Profit, mitigating blind-spots, improving leadership habits.