A better workplace
Tuesday, 7 August 2007
Last Updated: Friday, 14 September 2007
Creating a workplace people want to join is half the battle, top entrepreneurs say. Also, existing staff are likely to know who’s worth hiring. MIKE PRESTON reports
Each year fast-growing digital entertainment and infrastructure company Destra culls the worst performing 5–10% of its workforce. Destra chief executive Domenic Carosa has been doing this for years, and intends to continue despite the skills shortage.
“It’s just what you need to do to stay competitive,” he says. “Every company has fat in it, so by getting rid of the bad performers you can give more time and energy to the good performers and get new blood into the company.”
In an environment where many businesses are more focused on keeping their current employees than finding new ones, companies like Destra continue to find and attract top staff, allowing them to maintain a competitive and highly motivated workforce.
The experience of Destra and other fast-growing companies shows it is possible to defy the recruiting squeeze and gain a skills advantage over your competitors. SmartCompany asked top entrepreneurs how they make excellent staff want to work for them.
Make every employee a recruiter
Like other fast-growing businesses, advertising agency BoilerRoom Communications is always on the lookout for good new people, but managing director Kelly Addis says he will rarely use a head-hunter.
“We find that our staff are actually the best recruiters for the agency,” he says. “Our staff know who’s around, they talk to old workmates and people they know in the industry and we generally find somebody that way.”
Addis says staff referral is a quick way of finding new employees and it has big advantages in terms of candidate quality. “Hiring that way you have a better chance of someone who fits the existing culture and has a good dynamic between them and existing staff. The bond between people is itself a strength – we prioritise it over and above a particular skill set or experience a candidate may have.”
Addis will interview candidates suggested by staff, but he says there is a big element of trust involved in relying heavily on staff recommendations.
“But if we used professional recruiters it would belittle the people around me as to their judgement, and we’re in the people business. I trust my staff and I think it really empowers them to be involved in the recruiting process.”
The trend towards hiring through staff referral has been noticed by the recruitment industry, so much so that one firm, Job Bounty Hunter, has built its business model around what it calls “social recruiting”.
Job Bounty Hunter provides a forum for employers or recruiters to offer cash incentives of between $200 and $10,000 to people who can successfully refer friends, family or other members of their social network to an advertised job.
Job Bounty Hunter managing director Andrew Stuart says social job referral is a way for SMEs without large workforces to use referrals to widen the recruitment net.
“It means having hundreds of people searching for the perfect candidate for you, rather than just one,” Stuart says.
Culture is king
Entrepreneurs will tell you a strong company culture is the key tool for attracting good staff.
Maintaining an appealing and energetic company culture as your business grows is more important than ever according to Robert Phillpot, managing director and co-founder of construction and facilities document management company Aconex.
“Right from the staff we were very touchy-feely with our staff and people have a fair bit of pride with that; the challenge is to maintain that small-company feeling as we get bigger. You can’t manufacture culture; it comes from heart and you’ve just got to work to keep it,” Phillpot says.
Phillpot agrees that culture is a notoriously hard thing to explain, but he says you know it when you see it. “We think that our culture is quite unique: it’s a vibe, a buzz that runs throughout the whole business. Being young is part of it, the business is growing, it’s an exciting place to be around. Sometimes you’re running to keep up, but that means it’s not boring and people are attracted to that. Word gets around.”
Excited and engaged staff are the backbone of a good business culture, Philpott says. “When people come in they get a feel for the vibe around the place and they come away thinking ‘that looks like a good place to work,’ and I think it’s because people like working here.”
Steal from the competition
Some entrepreneurs say they will poach staff from the competition to get ahead. Destra’s Domenic Carosa says he regularly recruits from competitors.
“Most definitely we do try and get competitors’ top people. In this industry and with the tight jobs market you have to,” he says.
But, Carosa says, it is important to be upfront in the way you approach recruitment from competitors. Word will get out in the industry, and among your own staff, if you don’t.
“If we chase people from competitors, most definitely we will be very upfront about it, not secretive at all. We will just approach them directly and try and meet them for a chat,” Carosa says.
Although Destra pays competitively, Carosa says it is almost never money that attracts someone to leave a competitor.
“We just ask them what they want. If it is in line with what Destra wants to do then that’s the start of their coming across. It’s usually about career progression and getting them involved with a successful company that’s going places that gets them in, rather than money.
Even if employers are not looking at poaching staff from the competition, recruitment firms almost certainly will be, says Kevin Chandler, executive director of recruitment firm Chandler Macleod.
Chandler says the skills shortage has forced recruiters to make more regular use of the kind of aggressive recruitment techniques that had been reserved for the executive level.
“Recruiters are increasingly targeting industry sectors and business functions, mapping the availability and quality of people in that area and then going to those stand-out individuals and tapping them on the shoulder,” he says. “We’re actively chasing candidates rather than running an ad and having an individual reply.”
Chandler says the race to find and attract the best staff has intensified to such an extent that recruiters are now having to decide whether companies should be targeted as possible clients or sources of recruitment.
“We have to make those decisions now that we didn’t a couple of years ago. Companies want to know if they are a source or a client. Poor-quality employers are designated in some areas as sources and we won’t work for them; they’re a source of recruiting and that’s all.”
Don’t skimp on the interview process
Understandably, the intense pressure to find staff can create a temptation to skip lengthy hiring processes and grab any promising candidate who walks in the door.
This is a mistake, SEEK human resources director Meahan Callaghan says. “Like all companies we’re finding it challenging at the moment, but our recruitment process is really thorough. We always go through it no matter what the position or the period we’ve had the vacancy for.”
Callaghan says SEEK generally conducts about five interviews before they hire. “The candidate will have meetings with the manager of the role, their peer group and the people who will be reporting to them, and everybody gets a vote and a say in the selection. That way we can be confident of cultural fit.”
SEEK also uses psychometric testing and will ask for and check three or four references before hiring a candidate. “We try and keep the process short, but hiring is just too important for short cuts,” she says.
It’s up to you
There are resources available to help to businesses recruit in the skills shortage.
Most state governments provide resources. For example, the Victorian Government offers SMEs subsidies of up to 50% for spending on workforce planning and HR management capability though its recently launched My Business, My People initiative.
Industry groups can also provide you with recruiting know-how: look at these check lists for induction, reference checks and appointments provided by VECCI.
Businesses need excellent staff to grow and succeed.
Given the current skills shortage, this presents huge challenges for many SMEs. The experience of top entrepreneurs running business like Destra, Aconex, SEEK and BoilerRoom shows that by focusing on recruiting excellent staff and building your businesses culture, you can create a buzz about your business – and then the job candidates will come to you.
Read more about smart ways to pay staff, recruiting good people and moving bad staff on in our Growth Resources: Managing People section.
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Small businesses are finding it pays to offer family-friendly policies and let staff choose when and how they work, a new report shows. By AMANDA GOME.
The union portrayal of small-business owners as tyrants running inflexible workplaces is a myth. A new report shows that many SMEs offer very flexible workplace provisions and most offer part-time work and flexible start and finish times.
Employers also say this new flexibility has had a positive effect on their business and only 4% say staff abuse the conditions, according to the report. The skills shortage and new technology are also encouraging them to become even more flexible, with most planning further changes to obtain or retain skilled employees.
The report, Better conditions, better business, examined the views, experience and performance of 1800 small and medium-sized businesses (up to 200 employees), across a wide range of industries.
The overwhelming majority have unwritten informal agreements with staff. Relatively few use awards, human resources policies or AWAs.
Ninety-seven percent of SMEs have at least one provision to help employees in their work and caring responsibilities, the report says. “This is the first large-scale research looking into flexible workplaces of its kind in Australia,” says author Christena Singh. “It turns myths about small business owners being inflexible on their head.”
Some of the provisions seem fairly standard. For example 87% of employers provide access to a phone for family reasons, which quite frankly seems more like a right than a “provision”.
And 83% allow employees to choose the timing of annual leave and also give them the option of taking single days. Flexible start and finish times are offered by 73% of SMEs.
These are the three provisions employees use most. Another provision that is extremely popular with employees is letting them work from home. Although only 30% of businesses offer this, it is taken up by 83% of employees who have the option. The other popular provision, taken up by 60% of employees for whom it is an option, is onsite childcare, but only 5% of companies offered that provision.
Of note, family businesses are less likely to provide carer and family-friendly provisions than businesses that are non-family based.
And home-based businesses are more likely to offer onsite child care, the ability for employees to work from home and flexible start and finish times than non home businesses.
The gender of bosses and employees influences which provisions are offered. Where the workforce is predominantly female, almost all provisions are likely to be provided. Where women are the main decision makers, they are more likely to provide carer and family-friendly provisions.
And the caring attitude seems to pay off. SMEs that offer a large array of carer and family-friendly provisions to their staff reported very strong levels of performance.
Nevertheless there are concerns that flexible provisions result in the loss of productive time and increased costs. Although 42% of respondents felt there were no drawbacks, 23% felt they faced barriers in offering the provisions because of increased costs and 12% felt there was a loss of productive time, 12% felt it caused inconvenience on other staff and 12% loss of productive time. Only 4% felt that staff abused their conditions.
How do you compare?
- Offer a phone for family reasons 87%
- Provide flexible annual leave 83%
- Offer flexible start and finish times 73%
- Offer Part time work 61%
- Ability to bring children to work in an emergency 60%
- Offer unpaid emergency leave for casual employees 51%
- Offer carers leave for other family members 47%
- Provide unpaid parental leave 44%
- Ability to bring elders to work in an emergency 44%
- Offer carers leave for children 42%
- Offer job sharing 40%
- Ability to purchase additional leave 31%
- Working from home 30%
- Unpaid adoption leave 22%
- Paid parental leave 19%
- Onsite child care 5%
- Subsidy for childcare 5%
- Subsidy for elderly care 2%
Other perks offered by SMEs:
- Staff loans
- Ability to cash in leave
- Counselling
- Open door policy
- Bonus incentive
- Time off in lieu
- Rostered days off
- Payment for study
- Meals
- Extra insurance
- Staff discounts.
Do you have any additional ideas for employee provisions? Do you find employees take advantage of provisions?
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The lie about balanced living
‘My business is growing fast, but how do I balance its increasing demands on my time and energy with my other commitments?’
Suzi Dafnis has the answers: I don’t know who decided it was most ideal (and that we would be most happy) if all areas of our life received equal time and attention, but I think it’s a lie. The idea of a balanced life – of all things in equal proportion – is a mistake and sets you up for failure.
I don’t know who decided it was most ideal (and that we would be most happy) if all areas of our life received equal time and attention, but I think it’s a lie. The idea of a balanced life – of all things in equal proportion – is a mistake and sets you up for failure.
“How do you balance life and work?” I often hear people ask. Well, the reality of growing a business is that, in my experience, balance will remain elusive.
Here’s why – and what to do about it:
It’s your life!
You don’t REALLY have a “work life” and a “home life”. There is NO demarcation in reality: you have one life! So make it be what you want it to be. Every minute of every day you choose how you will spend time, with whom and doing what. You will be happiest if you choose for YOU, and not for anyone else. That doesn’t mean you can shirk your responsibilities, but don’t have to be a victim of time. You DO have power over your time, so use it.
You can’t manage time, so just do what matters
You have 24 hours – 1440 minutes – each day. Spend the time the way that matters to you most. If you’re focusing on business growth right now, you may spend a disproportionate amount of time working compared to socialising. If you’re raising children, you may spend more time between work and family than you do on health.
You can’t do everything (nor would you want to!) so use your energy and time doing what will make you happiest and get you the results you want. Make your life work for you. Your life will go through cycles as will your business. Just focus on what is important. Your priorities will change over time.
Get out of balance
Go on, get totally out of balance. Play full-tilt. The most fun you can have is in doing what you want to do at 110%. When you have a new business deal on the horizon put your passion and attention into that new client acquisition. When your body is crying out for rest, spontaneously take a “work day” out of your business to play all day with your kids or to walk on the beach. When you’ve been eating well and sleeping enough (and have energy reserves) burn the midnight oil on a project that lights you up.
Whatever hat you’re wearing (husband, mother, business owner, chef, friend), wear it 110%.
Notice your mood – and live consciously
Here’s some advice a friend gave me that works: take a look at your personal and business statistics and review your journal (you DO keep one, don’t you?). Note any patterns that you see.
This is a great way to find areas that work for, or against you. For example, you might see that your mood is up and you're feeling great if you read a book, worked out, called John Doe, or whatever it is that preceded a feeling of being happy and fulfilled. So you would want to do more of that action that created the feeling.
On the other side, you may see that NOT doing something that you intended to do, NOT saying something you wanted to say, talking to Mary Smith, brought your mood down.
Just notice. Awareness and going about your day in a conscious way will have you feel more in control of life (balanced if you like) and less at the effect of life. Play hard.
Suzi Dafnis is a Director of Pow Wow Events International (powwowevents.com.au), a provider of business and personal development tools for entrepreneurs. She is also the National General Manager of the Australian Businesswomen's Network (www.abn.org.au), which runs a mentoring program for women business owners.
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As they take over from baby boomers, Generation Y employees are proving more ambitious and more demanding, and one of those demands is for one-on-one nurturing.
By Mike Preston
Mentoring has gone mainstream. Once considered something for senior executives in lofty corporate towers, the onset of the skills shortage and a new generation of me-focused workers – Generation Y – have made mentoring a key staff management tool for SMEs.
And new technology means mentoring has become increasingly accessible to businesses of all sizes, as the next generation of Web 2.0 online tools makes it easier to tap into experienced business mentors in a time and cost-effective way.
Mentoring – a relationship through which a person uses the experience they have in business and life to help another explore and achieve their personal and career goals – is now on the agenda of a majority of top business managers, according to a recent survey conducted by chief executive professional development group The Executive Connection in the second quarter of 2007. Just over 50% of chief executives who responded to the survey said they already have or are developing a mentoring program at their business, up from 39% in 2006.
TEC chief executive Mike O’Neill says the drive to retain staff is clearly part of the explanation for the increase, a view supported by the fact that chief executives in labour-starved WA were the most likely to already have implemented a mentoring scheme in their workplace.
“Retention, retention, retention is the name of the game, obviously businesses in WA are putting mentoring programs in facing to deal with their particular problems but it really is a national phenomenon,” O’Neill says.
He predicts that mentoring will become more common as employers struggle to cope with the exodus of baby boomers from the workforce and their replacement by the under 30s – Generation Y.
“Generation-Y have all the information, they are ahead of everyone else in terms of technology and its application but that doesn’t mean they know how to make good decisions, and that’s where mentoring can be useful,” O’Neill says.
Self-confident and self-focused, the generation born between 1977 and 1992 can often prove a handful for employers. In a recent SmartCompany Opinion Leaders poll,71% of employers reported Gen-Ys are more likely to ask for training or mentoring, and they are more demanding than older workers on pay, career advancement and work/life balance.
Experienced mentoring researcher, author and director of consultancy Mentoring Works, Ann Rolfe, says Gen-Ys generally won’t stay in a job unless they feel their employer cares about them personally and has shown an interest in their career development.
“Gen-Ys need to have their career aspirations attended to – sometimes a bit of a reality check as well, of course – and that is something a good mentoring relationship is well suited to,” Rolfe says.
When mentoring is working well, the person being mentored is able to use the wealth of experience the mentor provides to reach their own conclusions about how to achieve their work and career goals, an approach Rolfe says Gen-Ys appreciate.
“They don’t want to be told what to do, and often that is exactly what baby boomer bosses are inclined to do, so that can be a bit of a problem,” Rolfe says. “Gen-Y responds to mentoring because it is all about helping people reach that ‘ah ha!’ moment for themselves.”
One Gen-Y-heavy SME that has taken to mentoring with gusto is Queensland beauty service provider Garth Male Grooming. Although a small business with four Gen-Y staff, owner Marguerite Hancock says the ‘ridiculous’ level of staff turnover in the beauty industry meant retention was a challenge she had to face.
“Holding on to staff is a top priority for us, but they won’t tell you what they want if you don’t ask, so mentoring is a way for us to keep a conversation going about where they want to go,” Hancock says.
Hancock encourages her employees to feel comfortable talking about money, but she says it is usually not at the top of their agenda. “One of the girls said she desperately wanted Friday off with her boyfriend, for another it was recognition and a name badge was really important, but I wouldn’t have known if we didn’t have the mentoring sessions.”
Hancock undertook some training before she started mentoring her staff. She meets one-on-one with each staff member for an hour or so once a month but also brings in an external mentor from time to time, time and money she believes is well spent. “You can’t make money without investing in staff, especially in a service industry,” Hancock says.
The use of an external mentor is something many mentoring experts believe is important because, however close the relationship, employees will often be reluctant to honestly discuss things such as long-term career aspirations with a superior.
The need to go outside the business can be especially important for SMEs, where experienced people will almost always have some management responsibility for staff. This can create a difficulty, however, if an appropriate mentor is located far away from the business or doesn’t have the time to visit the business on a regular basis.
Increasingly, however, mentors are using technology to get around this problem. The Australian Businesswomen’s Network, has been using cutting-edge Web 2.0 technology to connect female SME owners with mentors through its Mentornet program since January this year.
Mentornet uses a combination of online classrooms, blogs, podcasts, teleconferencing, virtual meetings and a social networking facility similar to Facebook and Bebo to facilitate interaction between experienced mentors and new business owners.
Online mentoring takes place in groups of four participants to one mentor via a hosted webinar that allows participants to see, talk, view common documents and see pictures of each other, or at any time through blogs and email.
ABN national general manager Suzi Dafnis says although participants find the lack of face-to-face contact a bit “weird” at first, they quickly adjust, with training and familiarity with the interface. “Once they’re in there interacting and raising their ‘hands’, they really get into, and it is much more convenient for busy people; for seven years we ran a face-to-face mentoring and it was hard to people to dedicate the time, so that is why we went to the online format,” Dafnis says.
Whether delivered online, over the phone or face-to-face, there are pitfalls that it is important to avoid when establishing an in-house mentoring program for employees. Mentoring Work’s Ann Rolfe says that when mentoring programs don’t work, it is usually for one of the following reasons:
- A failure to make resources available: far too many businesses set up an in-house mentoring program but expect mentors and their subjects to just “find the time” to participate. Mentoring requires preparation and can’t just be left to the last 10 minutes of a busy day, Rolfe says.
- No training for mentors: mentoring is a skill, and is different from training or coaching, Rolfe says. “Baby boomers, in particular, tend to want to tell people what they should do or how to do it. This is not what mentoring is about.”
- The mentor takes over: although mentoring can be rewarded for all concerned, the subject should be setting the agenda – after all, they are the ones you are looking to retain.
- It’s just another job: mentoring can’t be done in a tick-a-box way, especially where authenticity sensitive Gen-Ys are concerned. So when establishing a mentoring program, ask for interested volunteers, don’t make it part of a managers job.
There is, however, one downside to mentoring that can’t be avoided – sometimes the development of a junior employee will see them grow out of their job, and out of your business. But as Garth Male Grooming owner Marguerite Hancock says, in the current environment that’s something business owners have no choice but to embrace.
“You can’t stick you’re head in the sand and think you’ll have staff forever, and I would rather have somebody with the skills and ambition to want to do other things,” Hancock says. “If you stand in the way of their development, not only will you have a worse employee, they will probably leave anyway and be unhappy when they do.”
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