You Don't Have a Hiring Problem
Good people kept leaving my shop. The system I hadn't built was why.
Pillar: #Pillar2-Systems
When I was building U-Flow I ran into a problem. I kept hiring what I felt were good people who either didn't work out or left.
Take for example Mike. Mike was hired to do product costing, estimating and client communication. He had a background in this area so I thought it would be a good fit. The problem was he left after about 9 months. Mike wasn't the only one. There were Mel and Dianne, salespeople. Don't even ask me about the front office, accounting staff, marketing, HR, etc.
A pattern was emerging. Good people were leaving.
Why?
I realised that one thing never changed: me doing the hiring.
If you want to read the opposite side of the coin read my article last week on firing someone on the spot. This week is about people you never would fire.
I didn't think it was a hiring problem. As I mentioned, these were all experienced hires with demonstrated performance. After talking with the people that left I was hearing, in an indirect way, that they were confused about the system. When I thought about it, we didn't have a system. We didn't have processes, SOPs or a documented workflow. Because we started small and were growing, we operated on "tribal knowledge" — things and steps people learned to do to make the system work but never documented.
So what should I do?
I had no formal training in QC, process development or workflow tracking. I did have some computer training, machine language and FORTRAN, so knew the value of flow charts.
So I ended up hiring a consultant to help us with all of this. At the same time we started training people in these systems. Myself included. That eventually led us to ISO 9001 certification.
After that, hires stayed and the company grew with fewer problems — or at least different ones!
You don't need to create reams of documents and put them in a binder. Just do the following:
Write down how the work actually flows
Not how the org chart says it flows. Pick your most critical workflow — quote to cash, breakdown to repair, order to ship — and document what actually happens today. I would get the people actually doing the work to write down the process. Even if it takes them away from the production task. In the long run you will reap huge benefits. Then sit down and go over what they have documented.
Make decision rights explicit
When you are reviewing the documents, make sure any decision rights are assigned to the correct person. Don't put yourself as the one who makes the call on all the decisions. Push those down as far as possible. If you don't, nothing will work when you are on vacation.
Pick numbers that predict, not report
Don't rely on lagging financial statements. Those numbers already happened and you can't change them. Focus on a few leading indicators and track those. Quality metrics, quote turnaround time, scheduling adherence. Make sure they are reviewed by the people that can act on them. The ones who you know can make the decisions from the previous step.
Reinforce it with a mechanism, not a memo
A quick weekly action item review meeting will lock all these new ideas and processes into a rhythm. Once you do this it will be there forever. I have come back 5 years after working with companies and those weekly action item reviews are still there. The metrics may change but the mechanism is still in place because it works. Real change happens and improves EBITDA.
Do the above before you expand your hiring. The sooner the better.
Bottom line: you don't have a hiring problem, you have an operating system problem.
One next step: This week, pick your single most critical workflow and write down — one page, no more — how it actually runs today. Then show it to the person who lives in it and ask what you got wrong.
Further reading:
- The Score Takes Care of Itself — Bill Walsh with Steve Jamison and Craig Walsh (Portfolio, 2009). What an operating system for an organization actually looks like, built by the man who took a team from 2–14 to a championship in two years.
- Working Backwards — Colin Bryar and Bill Carr (St. Martin's Press, 2021). Amazon's mechanisms — the practical answer to running on good intentions.
- How Complex Systems Fail — Richard I. Cook (Cognitive Technologies Laboratory, University of Chicago, 1998). A short, sharp paper on why blaming the person at the sharp end guarantees the failure repeats.