June 6, 2022

Talent Magnets

I like the term magnet. Magnets attract things.  And once they’ve attracted those things, they usually remain attracted unless pulled by an outside force. Perhaps equally important, magnets also repel things.

I’ve scaled teams from low hundreds to thousands many times and I know firsthand that attracting talent is difficult.  It’s a scary world for startups trying to build teams.  Distributed work has become more common, with more and more employees saying they want to maintain some form of remote work even though it contributes to challenges with balance, burnout is high, and enablement is harder. Additionally, we’ve seen that employees have options and are in a position of power when it comes to exercising them. But, predating the pandemic, employers were navigating a stiff talent market. Tech salaries have been on the rise, yet half of tech workers still feel underpaid. Benefits have been evolving to focus on wellness and mental health at a time when employees need it more than ever, yet the average tenure in silicon valley remains a challenge. Burnout was a topic of conversation before Covid and remote work entered the picture. I think the problems we are seeing today - in a market where talent is scarce - have slowly been coming to a boil, and the pandemic really just accelerated something that was already looming.  

Throwing money at the problem is a short term, unsustainable solution that hasn’t led to the outcomes we really want. Maybe it’s time to pause, reassess and simply listen to what employees are telling us.

The work matters

I spoke with a founder recently and he said “you can hire the greatest engineer and put them on the most high impact work you have. But if they aren’t energized by that work, they will be less productive than if you put them on other work that is more aligned to what energizes them. If you don’t know what energizes them, or didn’t hire them for a role that energizes them, they probably look like a poor employee.”

Culture Amp published a study where they analyzed the survey responses of over 300,000 employees who voluntarily exited their company over the 15 months prior to COVID.  One of the more interesting findings in the study was that less than half of all surveyed employees identified as being “happy with [their] current role relative to what was described to [them].” It became even more interesting when they looked specifically at regrettable attrition. (For those who don’t speak HR, regrettable attrition is used to describe employees a company wanted to keep, who were performing well, but who chose to leave the organization.) Less than 10% of the employees who were tagged as regrettable attrition identified as being “happy with [their] current role relative to what was described to [them].” That’s a lot of unhappy people who feel like they didn’t get what they paid for, and if we look only at regrettable attrition, a lot of objectively good employees.

Enablement = Productivity = Balance

I briefly worked for Claire Hughes Johnson at Stripe - in the High Growth Handbook by Elad Gil, she makes this great analogy about games/sports. She says: “you know why playing a game is fun? Because it has rules, and you have a way to win.  Picture a bunch of people showing up at some athletic field with random equipment and no rules.  People are going to get hurt.  You don’t know what you’re playing for, you don’t know how to win, you don’t know how to score, and you don’t know what the objectives are.”

Culture Amp ran the study I referenced above again with a new cohort of 100,000 employees during the Great Resignation and found only one significant change: “Enablement, specifically not having easy access to the information needed to do one’s job became a new driver of attrition.” That’s an especially interesting insight as companies figure out how to operate remotely and are navigating whether to commit to distributed workforces. It’s evidence that the operating structures - the rules and equipment that tell people how to win, have always been critical but perhaps easier to delay before. I don’t believe companies can be successful at attracting or retaining talent if they don’t get this right. Companies that expect to remain hybrid or remote, absolutely have to get this right.

Allison Pickens recently wrote this post about Talent Efficiency. If you haven’t read it, you should. She states very plainly that “short hours are the secret of top companies,” and makes some very interesting points about why short hours signal success and why long hours may actually be an indicator of limited future success. I defer to her expertise on what shorter hours signals about total addressable market and product fit, but I do agree with her view that less hours are a talent magnet.

I share the Claire, Culture Amp, Allison examples together because they feel related to me - In order to avoid burnout, employees can’t sprint indefinitely, which means we need to find ways for employees to sprint when necessary in service of a specific goal and work more manageable hours when it isn’t. (Don’t freak out - we can point to successful companies here and here who have made this a priority). To work less hours without sacrificing outcomes employees need to be efficient. To be efficient, talent needs to know how to spend their time most impactfully in service of the outcomes the company is targeting. Ie: if you know how to win, you can be more productive and efficient. And, if we agree with Allison, working less may be more than just a talent attractor - it may also be an indicator of your company’s future potential.

So, what does this all mean?  How do companies take this and put it into action?

Tell the right stories

If you believe culture eats strategy for breakfast, and I do, then you know culture requires as much nurturing and attention as your product roadmap and revenue engine. In the absence of deliberate nurturing, employee behaviors won’t reflect your values and you’ll be left to rely on a good strategy alone. At the highest level, telling the right stories is paramount to nurturing culture.  It highlights the heroes and heroines who are behaving in a way that is aligned with the strategic goals of your organization. There’s a book I like called “The Right Story” by Bernadette Jiwa. In it, she proposes that “the right story is one that is trusted. It is believed because it is told by the right person, for the right reasons, in the right way, at the right time, to the right people. The success or failure of our ideas depends on us telling the right story. We can only do that by being clear about the change we want to create, and why—and then bringing enough of the right people with us on the journey. It’s up to us, the changemakers of today and tomorrow, to galvanize those people we hope to bring on the journey with us.” This excerpt beautifully summarizes a critical responsibility of a founder and their leaders when building teams.

The moral of the story is this: tell stories that identify and celebrate the behaviors and roles that enable your strategy. Telling the right stories is a thread that runs through your entire lifecycle:

(1) Candidates need to hear stories that show alignment to join.  

(2) Employees need to remain aligned to stay.  

Make a plan, replan, plan again

Growing is hard and things change a lot when you’re growing quickly. That’s true, but I can say firsthand the pain of growth becomes more acute when founders focus too far ahead and lose sight of the stops on the way from point A to Point B. It’s also more acute when they don’t take time to revisit the plan regularly and adjust. Patrick Collison once said that you’re a new company every time you double. If we believe that, then short term plans will become outdated very quickly.

Reverse engineer a headcount plan from your 12-18 month outcomes. Build a compelling employee value proposition and design roles that are aligned with those outcomes. Tell that story - the true story of your current challenges, expected outcomes, and what stands in your way; what you do and do not care about. Highlight successes within your org that are aligned to that story. Hire people who are motivated by that story, and qualified to reach the outcomes.  

  1. Every hiring manager and leader should be able to tell this story before opening a role.  
  2. If those problems and outcomes aren’t aligned with the candidate’s goals or experience, it’s not a match on either side - and that’s ok, because magnets also repel things. Don’t just tell the stories you think a candidate wants to hear.
  3. Your job descriptions should be telling this same story.
  4. Revisit this as often as quarterly if you are growing fast and ADJUST YOUR PLAN
  5. Sometimes (less than 25% of the time) in hypergrowth, the story is “we’re not sure.”  That’s ok, but say that.  If you’re “not sure” more than 25% of the time, hire someone to help you focus on operating and planning more effectively.
  6. Use the plan to ensure you don’t hire ahead and don’t over index on either potential or experience (look for a balance when growing).  Either of those situations will lead to misalignment and unhappiness with role vs expectations.

Ask the right questions

In addition to telling the right stories, you must also ask the right questions - both of the candidate and of yourself.  Hours are spent crafting and conducting interviews. Arguably, if interviews have gone well, people we hire should be successful most of the time. But, success in a role is composed of multiple factors. Can a person do the work well?  Are they culturally aligned to your organization? Do they have positive references. Often we identify all of those things in the interview process and then stop. The question we miss most often is: “Can I make this person - who is qualified, culturally aligned, and verified - successful?”  If the answer is no, either move on or figure out how to change quickly so you can resolve this.

This (1) ensures that when you hire, you hire the right people and that you are well set up to keep them, (2) seed the behaviors you want to see from day 1 by being transparent about what you do and do not care about and (3) create employees who are more likely to be resilient in the face of challenges because they knowingly signed up for them.  

For candidates, these actions (1) allow them to fairly evaluate if they believe in your company, mission, goals, product, and revenue targets and most importantly, the work they’ll be doing and (2) creates authentic alignment and the trust necessary to stick around.

Be a Talent Magnet

Talent magnets prioritize what matters - they know resources are scarce and hiring is expensive and they recognize that planning and alignment are key elements to attracting what they need, and repelling what they don’t.