As a manager, I’m sure you could make a list of traits – in addition to applicable job skills – that any employee must possess in some quantity to be successful: things like intelligence, responsibility, initiative, attention to detail, ability to learn – you get the idea.

But what about “grit?” Is it important to success?

Yes, that is exactly what I mean. Grit. As in True Grit. No, not ground corn, the texture on sandpaper, the old small-town newspaper, small pieces of rock, or even what you do with your teeth when enduring pain (or your mother-in-law). No, I’m talking about perseverance, stick-to-it-iveness, tenacity, John Wayne with a bit in his mouth – that kind of thing.

To what degree does “grit” play a role in determining a person’s success? Well, evidently, it’s really important:

Consider, for instance, a recent study led by Duckworth that measured the grittiness of cadets at West Point, the elite military academy. Although West Point is highly selective, approximately 5 percent of cadets drop out after the first summer of training, which is known as “Beast Barracks.” The Army has long searched for the variables that best predict whether or not cadets will graduate, using everything from SAT scores to physical fitness. But none of those variables were particularly useful. In fact, it wasn’t until Duckworth tested the cadets of the 2008 West Point class using a questionnaire – the test consists of statements such as “Setbacks don’t discourage me” – that the Army found a measurement that actually worked. Duckworth has since repeated the survey with subsequent West Point classes, and the result is always the same : the cadets that remain are those with grit. [Jonah Lehrer. "The Truth About Grit." The Boston Globe (August 2, 2009)]

What is interesting to me is not that grit (or perseverance, or tenacity) plays a key role in success – that seems pretty fundamental to me – but it was the one factor in the study that most clearly predicted success. Knowing that will certainly cause me to look closely at the hiring process and the key traits we identify during interviews.

Praise Smarts or Praise “Grit?”

Another interesting point came out of this article that is relevant to managers. It seems that praising people for their intelligence – when they solve a problem, for example – and ignoring the “grit” they may have used to stick to the problem until it was solved, may have an adverse affect on future efforts:

Interestingly, it also appears that praising children for their intelligence can make them less likely to persist in the face of challenges, a crucial element of grit. For much of the last decade, Dweck and her colleagues have tracked hundreds of fifth-graders in 12 different New York City schools. The children were randomly assigned to two groups, both of which took an age-appropriate version of the IQ test. After taking the test, one group was praised for their intelligence – “You must be smart at this,” the researcher said – while the other group was praised for their effort and told they “must have worked really hard.”

Dweck then gave the same fifth-graders another test. This test was designed to be extremely difficult – it was an intelligence test for eighth-graders – but Dweck wanted to see how they would respond to the challenge. The students who were initially praised for their effort worked hard at figuring out the puzzles. Kids praised for their smarts, on the other hand, quickly became discouraged.

This sheds some light on the importance of how a manager praises and encourages employees and what that praise/encouragement is for. And it is consistent with our 1-on-1 Management™ principles of praising employees: praise the underlying motivation or character trait that caused the performance and you will more readily see the performance duplicated.

What is the single greatest challenge facing any business today, large or small? A recent survey conducted by Deloitte Consulting LLP and the International Society of Certified Employee Benefit Specialists provides a vivid clue – and a distinct warning:

A shortage of skilled and talented workers has become the most pressing concern among employers, supplanting the perennial leading problem, [the] rising cost of health care…

A similar survey in the oil and gas industry echoes this concern:

Nearly 90% of senior human resources (HR) executives at 22 top international oil and gas companies believe their industry faces a talent shortage and call the problem one of the top five business issues facing their companies.

Top five issue? Try growing your business without a sufficient number of talented employees. Without talent, the best companies in the world will spin their wheels. Sure, there are lots of challenges in the workplace, but a lack of talent is, or will be, the constraining resource in business.

Dina Pyron, of Ernst & Young’s Global Oil & Gas Center observes that, “The lack of key talent could potentially impact corporate growth, financial performance, safety and reputation. This should raise a red flag to leadership that immediate and innovative solutions are necessary.”

Solutions are, indeed, necessary. Unfortunately, this is a problem that cannot be solved, at least not in the traditional sense. You simply cannot produce more people where they don’t exist! According to the Oklahoma Employment Security Commission, the state’s unemployment rate dropped to 4.2% in March 2008 while the Texas jobless rate dipped to 4.1% – a thirty-year low.

With no talent to be found, big business is looking everywhere to find it – including your business. This means that the talent shortage will likely impact your company even in the unlikely scenario that you have all the employees you need!

The only real solution to this problem is training and development – no, not for your employees, but for your managers. A survey of almost twenty thousand employees indicates that 88 percent of employees leave companies for reasons that have absolutely nothing to do with money. Instead, the vast majority of those reasons are directly attributable to the immediate supervisor or manager. Remember this: employees join companies, but they quit managers.

If your company does not have a plan to adequately train and develop your managers into effective leaders, what will you rely on to keep your talented employees on board?

Attitude is a subject that comes up quite frequently; sometimes it’s the manager’s attitude that is being discussed and sometimes it is an employee’s attitude that is being cussed….er, discussed. In either case, the bottom line is simple: attitude is everything.

Let’s start from the beginning. We can easily acknowledge that both employees and managers make mistakes. Sometimes they even demonstrate poor judgment. If it happens enough times, either can lose their job as a result. I would add that managers, in particular, must learn to be forthcoming about their errors, and offer up apologies when they fail in some way, or their employees won’t trust them.

However, I’m not talking about “making mistakes”, but rather how someone reacts to mistakes. How you react when you are asked about a mistake. How you act the rest of the day (and tomorrow) after you are confronted about a mistake. When discussing attitude, it really doesn’t matter if we’re talking about you, the manager, or one of your employees. If your attitude is sour, or you frequently become negative, surly, pessimistic, or otherwise hard to get along with on the job, you have got to go. Whether manager or employee, it doesn’t matter – you either change, or you’ve got to go, for the sake of the team.

In the fall of 2006, Philadelphia Eagles owner Jeff Lurie spoke about his experiences with the notoriously temperamental Terrell Owens, whom he had dismissed from the team:

“I would not do it again,” Lurie said Wednesday in his annual state-of-the-team address. “You look back on it – one year great, the second year a disaster. Nobody should be able to be as disruptive and really cut the energy of the team down.”

“I think we all learned from that.”

During his first year in Philadelphia, Owens helped the Eagles reach their first Super Bowl since the 1980 season. But he was a major disruption throughout last season. The Eagles endured a dismal, injury-plagued 6-10 season, and Owens’ tenure in Philadelphia ended bitterly.

He signed on with the Dallas Cowboys, one of the Eagles’ main rivals in the NFC East.

“If you don’t have the chemistry, the talent and the help, with high-character people, you’re not going to survive those downturns in the middle of the season,” Lurie said.

A great player. A disaster for the team. Without question, even a great employee can be a significant disruption to the company if he or she has a bad attitude. It is not uncommon to find employees with loads of talent that create incredible turmoil within an organization with their negativity and self-centered behavior.

• They blame others instead of accepting responsibility.

• They sulk and complain.
• They make other employees “walk on eggshells”, who, in turn, try desperately to lighten the mood.
• They criticize everyone – customers, managers, employees, vendors.
• They don’t apologize for failure – there is always a “reason” why they failed, and it wasn’t their fault.

The old adage says, “One rotten apple will spoil the whole barrel.” You better believe it. I don’t care how good the employee is, if they make everyone else miserable, you will eventually pay a huge price for keeping them on board. Unfortunately, many managers are unwilling to confront “problem” employees and, as a result, the whole team (company, department, etc.) suffers.

Wise up. Learn from Jeff Lurie’s experience and make character a critical and necessary requirement for working on your team. If you allow an employee with a bad attitude to stay on your team, it sends a message loud and clear to the rest of your employees.

I’m not sure you will like what it says.

If there is one process that has a dramatic and far-reaching impact on all phases of a small business, it is the hiring process. Few small businesses have a well-thought out, systematic approach to hiring the best people possible.

In fact, hiring in many companies is reactive by nature. Someone quits – you look for a replacement. You run an ad, get a zillion resumes, finally find a few applicants that seem to fit the bill, and then you bring them in for an interview. You make some small talk – size up your applicant – review their work history, ask a few more questions and then check those references (which, surprisingly, always turn out to be great!). Narrow down to the two best and choose one.

Sound familiar?

You know the consequences of this approach as well as I do. The odds of getting a talented player are usually pretty remote. Even worse, the costs of making a bad decision are often enormous.

Every company should have a defined and well-planned hiring process. Great companies have adopted a rigorous hiring approach like the one detailed in the book Topgrading: How Leading Companies Win by Hiring, Coaching, and Keeping the Best People. If there is any one factor that is completely under the control of managers, it is the people that you bring into the organization. It only makes sense to do the very best job possible in this area.

• Do you have a defined hiring process?
• Have you accurately defined the talents and skills needed in the open position?
• Do you ask interview questions designed to uncover specific past behaviors?
• Do you drill down to get specific and detailed answers to questions regarding past performance?
• Do you ask the same questions of each candidate so you can compare accurately?

These are only a few of the questions that you should ask regarding your hiring process. It is getting more and more difficult to hire talent – if your company’s track record isn’t stellar, get a proven consultant to help.

I finally had the opportunity to watch this movie, which stars Will Smith and his real-life son. It is based on the true story of down-on-his-luck Chris Gardner (Will Smith) who overcomes enormous obstacles to become a successful Dean Witter stockbroker.

This film is heart-wrenching. It has also has a number of great lessons to teach – perseverance, pursuing your dreams, overcoming adversity….and many more. I want to look at the movie from a manager’s perspective, and I will also look at it from a salesman’s point-of-view in my Sales Blog.

As we have discussed, identifying and hiring talent is critically important to developing a high-performance organization. While Gardner had to position himself just right in order to get the attention of Dean Witter executives, you have to give them credit for giving him the opportunity to become a part of the organization.

The short version of the story is that Gardner is successful in gaining admittance to a six-week internship program, which pays absolutely nothing. Six weeks – no pay. The twenty candidates vie for one slot as a Dean Witter broker, a hiring decision that is based on a written test as well as sales performance.

After getting the opportunity to interview for the internship position, Gardner shows up to the interview with three Dean Witter executives in an undershirt, a “Members Only” jacket (old-timers will know what that is), and paint splattered all over himself! In one of the best examples ever of “bad timing”, the police had shown up at his apartment the day before – as he was repainting the interior – and escorted him to the police station to pay some delinquent parking tickets. Unfortunately, Gardner is forced to stay overnight in jail and is not released until 9:30 the following morning – 45 minutes prior to his interview for the internship.

At this point in the movie he has no car, so he is forced to run – yes, run – to his interview, and he arrives paint-splattered, unshaven, and disheveled. Only his initiative and some good fortune had earned him an interview (I won’t tell you how in case you haven’t seen the movie), but I cannot imagine ANYONE giving this guy a chance when he shows up looking the way he does.

Here is one of the great lines in the movie: one of the executives asks Gardner to put himself into his (the executive’s) shoes and says, “What would you say to me if I told you I had decided to bring a guy into the intern program after he showed up to the interview wearing no shirt?” Gardner’s response: “He must have had on some REALLY nice pants.”

The lesson I took from this illustration is to look beyond the exterior and focus on talent when hiring. Gardner was very good with numbers (as you will see if you watch the movie), and he was obviously very quick on his feet. Both of those “talents” were critical for success in the position they were hiring for, so it was enough to get Gardner a try-out with the company – despite the apparent knock-out factors. Yes, he still had to earn the position during the six-week internship, but his talents were recognized and gave him the opportunity.

During interviews, some people may present really well, but lack the critical talents your open position needs. Don’t get dazzled into making a bad hire! The candidate might be an asset elsewhere in the organization, but don’t overlook the talents that are absolutely necessary to be successful just because someone is good during the interview process.

On the other hand, if a person demonstrates the key talents for the position but doesn’t knock your socks off in the interview, you might not want to give up right away. Look deeper, and consider possibilities that would allow them the opportunity to earn the slot.

You don’t want to give away a key player just because they don’t look or sound just right during the interview.

It is not at all uncommon during the course of my work to survey a company’s employees. These surveys help me to gain critical information regarding the corporate culture, the employee’s view of the company, and the level of employee engagement.

Here is an observation that I am sure will stun no one: employees that complain about the company almost never have a negative view of their own performance or their own contribution to the problems they describe. For example, a majority of employees may report that they have a positive attitude and do their job well, but, at the same time, they believe that there are many problems in the company created by sub-par performance, poor attitudes, and inattention to detail. Everybody else is a problem – not me.

The reason this is important is because high performance has been closely linked with a person’s self-awareness – their ability to understand themselves according to reality, not who they want to be or how they would like to be perceived.

Many companies do themselves a disservice by not spending more time developing a comprehensive hiring strategy. Hiring is usually reactive, instinctive, and based primarily on job skills and a few core competencies. The costs associate with employee turnover, and the increasing challenges with employee engagement, are creating an environment where managers must be able to consistently hire and retain talent.

We have just released a Special Report entitled Protect Your Investment: 5 Critical Reasons Why Managers MUST Be Trained to Hire and RETAIN Talent. Click here to download.

(Note: this picture of downtown Tulsa was taken by Steven Roemerman – click here to see his Blog.)

According to the U.S. Department of Labor, unemployment in Tulsa, OK jumped in January and February 2007 – catapulting up to a whopping 4.1%. Well, considering it had been 3.5% for three months, that’s a pretty good jump!

The labor shortage in Tulsa is a very real challenge. I spoke with someone today that told me he could place 200 welders TODAY if they were available….problem is, they aren’t. Hardly a day goes by that I don’t get into a conversation with a business owner or executive about the inability to find qualified workers. There are hosts of companies that simply cannot continue to expand because of severe labor shortages!

So, what are companies doing? About the only thing they can do really – they are looking around at their competitors and attempting to find talented, yet disgruntled, employees at YOUR company. They are trying to lure away the disengaged employees at your place of business!

Talent retention has become the buzzword in business circles. Many companies are beginning to employ “employee retention strategies” – using things like perks, additional benefits, signing bonuses, and other items to keep talented people on the payroll. After all, the cost of turnover is estimated to be a minimum of 29% of the employee’s annual salary and and as high as 400% of the annual salary, depending on the position.

According to an article published in MIT Sloan Management Review in 2002 (Bartlett and Ghoshal, Building Competitive Advantage Through People):

“There is a surplus of capital chasing a scarcity of talented people and the knowledge they possess. In today’s economy, that is the constraining – and therefore strategic – resource.”

Experts agree that the problem is only going to get worse, and it should be high on your list of potential threats to your company. If your employees are disengaged – and the data suggest that 2/3 of them are – then you are a target-rich environment for head hunters and your competition.

What should you do? First, you need to evaluate the extent of this threat to your business. Second, you need to evaluate your hiring process. Consider this quote from an American Management Association article entitled Retention Before the Fact (Carol Morrison, HRI):

“Development Dimensions International (DDI), which conducted research on 4,000 workers in various industries, identified six traits that DDI says can help employers determine, during prehire interviews and testing, whether or not an applicant is likely to become an engaged and lasting employee. The six characteristics are “adaptability, passion for work, emotional maturity, positive disposition, self-efficacy and achievement orientation.”

Third, you need to evaluate your managers (or yourself if you own and run the business) and determine if they have the skills to hire and develop talent. Finally, you need to ensure that your managers receive training in the critical areas that impact employee engagement.

In Leigh Branham’s book, The 7 Hidden Reasons Employees Leave, Saratoga Institute research indicates that 70% of the reason that employees leave a company can be directly attributed to the manager. The reality is that most managers receive little, if any, training in leadership and coaching – two skills that contribute directly to an employee’s satisfaction with their job. In fact, according to a 2005 Conference Board Report, 2 out of 3 managers are considered to be poor leaders .

With talent at a premium, you might want to put a strategy together to protect your investment.

Even firms that employ a thorough hiring process often fail to follow up with new employees after a short time on the job. In comparison, when the company makes a significant sale it is common practice to follow up with a customer at least once, and sometimes multiple times, in order to ensure customer satisfaction. I suspect that employees (and companies) would benefit from the same practice.

My suggestion would be to add follow-up interviews to your hiring procedures. Conduct an informal follow-up meeting at 1 week and again at 1 month just to make sure everything is going well – those first 30 days are crucial to integrating into the company and finding out all of the things that aren’t in a job description.

At 60 days, conduct a formal follow-up and provide the opportunity for the new employee to speak candidly about the job, their expectations, and any observations they may have. Not only does this communicate value to the employee, but it may very well prevent a very minor challenge from growing into something significant.

Here are a few questions to ask a new employee after they have been on the job for a couple of months:

1. Are the requirements of the job as you expected? Did we communicate well in that regard?
2. How would you describe the company’s mission? Primary objectives?
3. How do you see your job connecting to the company’s mission and objectives?
4. Have I explained clearly what I expect of you?
5. Have you encountered anything that you don’t clearly understand?
6. What can I do to help you be more successful in your job?

Also, make sure to ask the employee about their impressions of the company and the job after 60 days in comparison to their perceptions after the interview process. This will help you determine if you are painting an accurate picture of the company for new employees. When a company meets the employee’s expectations, the odds for high performance increase significantly.