I was recently talking to an MI retailer with his two successors. Here’s how the conversation began.
Jaimie: So tell me about store #2. How’s the team?
Owner: They have their challenges.
Successors: They are not motivated. They don’t jive with our culture. They are negative. We think there needs to be some changes.
Let’s face it: your few top performers are responsible for most of your profit. That means your mediocre players are responsible for most of your losses. According to the 2016 Conference Board CEO Challenge Survey, the number one concern of CEOs was retaining and growing talent.
Jeff Hyman, author of Recruit Rockstars, says getting talent right in your company demands spending 30 to 50 percent of your time on recruiting and retention. You say you don’t have the time? Ask yourself how much time you spend putting out “people fires?” I’m talking about staff that blame others, staff who come in late, staff who are not fun to be around. Now think about if you had more top performers.
You’ll have extra time for retaining and identifying and recruiting other “Rockstars” because top performers don’t need to be micromanaged. They love to be challenged and have strong people skills.
How are Rockstars measured?
There are two metrics. Metric #1: Those producers that are in the top five percent of performers in your store. Let’s call metric #1 “competency.” While revenue and profit are critical, top star status is not limited to numbers.
For example, let’s say “Joe” is your top revenue producer. He passed the first Rockstar metric. Joe is extremely competent. However, Joe by nature is negative, a knowledge hoarder, and unwilling to help others, so he fails the second metric.
Metric #2: “values alignment.” Values alignment simply means to what extent your team embodies the owner’s personal positive values which help to define the corporate culture. If beliefs and behaviors are not in alignment with those values, the culture is out of balance and begins to erode. When the culture erodes, going to work is no longer fun. On the other hand, if the culture reflects a caring, people- focused vision, the company culture promotes employee happiness, turnover is reduced, your current team will be more productive, and newer Rockstars will want to work for you.
Owners naturally want to gravitate to employees who match with their core values. As a result, even though Joe is a top producer, he doesn’t get top gun status.
Remember – it only takes one bad apple to spoil the bunch.
On the other hand, let’s say “Sally” has numbers that are not as good as Joe’s. So, for the competency metric, Sally is identified as a “B” player. However, when it comes to aligning with positive values, Sally is very different than Joe. Sally is first to share what she is learning with the rest of the team. Sally always has an encouraging word, and most of your team enjoy working with her. You decide that Sally, with some coaching, can grow into Rockstar status. While Sally gets a B for her sales skills, she gets an A+ for being a team player. Here’s the formula: Competency + Values Alignment = Status= A, B, or C.
Well-begun is half-done
The first job I had in the financial services industry was off to a strange start. The owners shook my hands, wished me good luck, and pointed me to my office. That was it. The owners were busy, and offered little direction.
According to Hyman, to help employees improve, owners needs to help the employee know:
1) Functional job skills: How to do their job, the way your company expects it to be done
2) Interpersonal skills: How to deal with people
3) Organizational skills: How decisions are made
Require an audition
Whether you are thinking about promoting a current team member or you are considering recruiting a new team member, think about requiring an audition. By “audition” I mean requiring the candidate perform an aspect of the job in a real-world scenario. This can last for three hours, or three days.
The idea is for you to see how your candidate can solve problems, interact with your team, and evaluate how successful your candidate is at putting out fires so you don’t have to.
Ask for a referral
Employee capital is your most valuable asset – more valuable than your inventory. As an intangible asset, you’re not seeing it on your balance sheet, and what you don’t see you’re not managing. I recommend you manage your employee relationships with the same attention you manage your client relationships.
Using a customer relationship database to capture nuggets from your conversation is key. And during these conversations, ask your “A” players, to refer other “A” players. Your bottom line will thank you.
At the Winter NAMM Idea Center this January, I’ll be doing a deeper dive on this topic. Stop by and say hello.
Jaimie Blackman – a former music educator & retailer– is a licensed financial advisor and succession planner. Blackman helps music retailers accelerate business value now and maximize value when it’s time to exit. Blackman is a frequent speaker at NAMM’s Idea Center and writes The Sound of Money, a monthly column for MMR. Visit jaimieblackman.com to preview his value creation tools and to subscribe to Unlocking the Wealth newsletter and webinars.
