Jack Welch on the Four Types of Employees

My younger brother is a first year student at Harvard Business School and was recently discussing a case in class on Jack Welch’s management style. After 35 minutes of discussing the case, the professor surprised the class by having Jack Welch come in personally and answer questions. The key message by Welch was that of the four types of employees and what you should do with them:

  • High performer that buys into the corporate culture — promote and empower them as much as possible
  • Low performer that doesn’t buy into the corporate culture — fire them as quickly as possible
  • Low performer that buys into the corporate culture — give them a second chance in a different position to see if they can be an ‘A’ player
  • High performer that doesn’t buy into the corporate culture — do a public hanging where you fire them and then discuss with other managers their short comings
Of course, the last two types are the ones that provide the most difficulty for companies. I thought it was an interesting perspective from a very decorated business person.

Hiring Inside Sales Reps

Last week I looked for my first crowdsourced answer to a question by posting to my network on LinkedIn. This was the first time I’d asked a question, and I must admit I was surprised by the variety and quality of the responses. It isn’t that I didn’t think that my network would have good responses, but rather that very few people would respond. I had many more responses than expected. Here were some of the consistent themes to the question “What are some recommendations for finding good inside sales reps”:

  • Hire a “Sales and Marketing Assistant” that does all of the coordinating work with prospects so that current sales people can spend more time on serious leads
  • Use a staffing firm that specializes in sales reps as well as uses TopGrading to evaluate candidates
  • Use job boards from local colleges and universities focused on management majors and general business majors
I wanted to say thanks to everyone that responded.

Include a Written Section during Interviews

One of the best techniques to employ during the interview process is that of a written portion. For us, we have a series of research questions that aren’t easily answered without effort. It helps us understand the candidates’ writing skills, resourcefulness, and attention to detail.

In addition, being a SaaS company makes it easy for us to provide a few simple assignments for the candidate to do using our web-based software. This helps us better understand how quickly they pick up new products, their resourcefulness, and their likelihood of success in the company.

I recommend using a variety of different techniques to assess candidates.

Thoughts on the Employee Hiring Process

We’ve been spending quite a bit of time lately doing interviews and hiring new people, as we’re experiencing significant growth in both of our product lines. Here are some quick thoughts:

  • Come up with simple bullet points of the types of characteristics you look for in the person and include those in the actual job posting (e.g. good natured, professional, self-starting, etc. are what we look for)
  • Identify some easy ways to filter resumes (e.g. in-bound emails from @aol.com addresses and those without a full paragraph or two in the email message itself are immediately deleted, without even looking at the resume due to not being tech savvy enough as well as not interested enough)
  • Do phone interviews first, followed-up by in-person interviews, and include the Top Grading techniques if it is a manager position or requires several years of experience

Good luck!

Quarterly Performance Reviews

I’m a big proponent of doing 360 degree performance reviews every quarter. Many companies do them annually or twice a year. I feel that is too infrequent and that you spend most of your time talking about the most recent quarter, at best. Another benefit of doing it quarterly is that compensation discussions aren’t tied to every review. This makes it less stressful and more useful.

We follow the advice of Patrick Lencioni and only have four simple questions on our quarterly performance reviews:

  1. What did you accomplish?
  2. What are you going to do next?
  3. How can you improve?
  4. How are you following the values?

Every employee answers these question for themselves as well as their direct reports and manager. It is an invaluable tool and I highly recommend it.