With all the layoffs and rumors wreaking havoc on retention policies you might think that hiring good people just got easier.

It didn’t.

With hundreds of responses to every ad, this is the time when your hiring skill really matters; when your ability to recognize jewels where others see only lumps of coal will give you an edge.

Whether the talent market is tight or loose, you should always remember that your next top performer didn’t necessarily

• have the best grades;
• attend a prestigious school;
• work for your competitor or
• even in your industry;
• have a full head of hair that has no gray; or
• fit easily into your comfort zone.

What you want is the person who ‘fits’ your corporate culture, has a great attitude and fills the skills hole in your group—in that order.

One result of hiring talent instead of skills is loyalty.

Real loyalty can’t be bought with either money or stock options, it’s earned through your actions, your willingness to take a chance, to provide the place where the coal has the opportunity to become a diamond.

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First up today is a review from Knowledge @ Wharton Of Dov Seidman’s HOW: Why How We Do Anything Means Everything … in Business (and in Life). The book focuses on building a corporate culture where “”how” matters more than “what” in business, and how “should” matters more than “can.”" Seidman believes that “companies and their people can operate in both a principled and profitable way.” He believes that “A leading company should be a company of leaders.”

Next, and interesting interview on IT World with CIO Tony Scott who is charged with creating a culture of innovation a la Google at Microsoft—wow, talk about a challenge!

Third, a look at Charles Liang, co-founder and chief executive of $600 million Super Micro Computer, a 15-year-old computer maker with 850 employees. Liang is a one-man management band, so the big question is what happens if he goes poof?

Finally, from Business Week, the opportunity to nominate your choice for the best—or worst—Manager of the Year. The worst category offers the most opportunity, but for a greater challenge think about who deserves best. Please share your nominations here, too.

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Yesterday I mentioned four basic traits of good culture. Today I want to talk about another one that many people, especially those running startups and small companies, often don’t like and don’t implement.

Process.

The problem is that people frequently confuse process and bureaucracy.

• Process is good—it helps to get things done smoothly and efficiently.

• Bureaucracy is bad—it’s process calcified, convoluted, politically corrupted, or just plain unnecessary.

The hallmarks of good process are

• easy-to-use and flexible method of accomplishing various business functions; and
• informal without being haphazard, and neither ambiguous or confusing.

Occasional surveys (internally asking staff and externally asking vendors and customers how things are working) alert you to when processes start to mutate. By creating a skeletal process and a corresponding graphic in areas where it is needed (financial controls, hiring, purchasing, etc.), you lay the framework for your growth in the future, no matter how hectic.

Bureaucracy stems from people, be it a CEO or first level supervisor, who believes that her staff is so incompetent that it is necessary to spell out exactly how every individual action, no matter how small, needs to be done.

To correct this, the manager responsible must

• must recognize and take responsibility;
• reduce his own insecurity;
• increase his belief in his current staff; and whenever possible
• hire people he thinks are smarter than himself!

Bureaucracy is also fed by people’s fear of change, “We’ve always done it like that.” and similar comments are dead giveaways.

Another significant factor that contributes to unnecessary bureaucracy is the failure to align responsibility and authority.

If a person has the responsibility to get something done (design a product, create a Human Resources department, meet a sales quota), she should have enough authority (spend money, hire people, negotiate with outside vendors) to get the job done.

Giving people responsibility without concomitant authority forces them to constantly ask their superiors for permission, thus reducing productivity, and lowering moral.

The final, and most important difference between process and bureaucracy is that people like working for companies with good process in place, and hate working for those mired in bureaucracy.

But not for long—they leave—making bureaucracy-eradication a major tool in the culture and retention game.

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A lot has changed since I started RampUp Solutions a decade ago. Back then, getting a CEO to discuss corporate culture ranged from difficult to impossible in direct proportion to the size of the company.

Bosses often viewed culture as an abstract concept, a creation of consultants to increase billable hours, but not something that would/could impact on the bottom line.

But that was then, this is now.

“82 per cent of [Canadian] executives surveyed said culture has a strong, or very strong, impact on their company’s performance.”

Meanwhile, in the lower 48, from a new study on innovation, “Corporate culture is, above all, the most important factor in driving innovation,” said Rajesh Chandy, a professor of marketing at the University of Minnesota’s Carlson School of Management and a charter member of the U.S. Department of Commerce’s Advisory Committee on Measuring Innovation in the 21st Century Economy”

Innovation and healthy bottom lines go hand in hand. While innovation may not be the quick bottom line fix that layoffs and other cost cutting actions are, it is the preferred choice of CEOs who understand that surviving isn’t enough.

What weight do other factors have in driving innovation?

“…among traditional drivers of innovation such as government policy, labor, capital and culture at the country level, the strongest driver of radical innovation across nations is corporate culture.”

Chandy goes on to say, “It is important to realize that all innovative companies look alike. They share a common culture no matter where they are located.”

Nearly three years ago I wrote about what people want and don’t want and it hasn’t changed much, if at all.

There are many cultural traits to consider, but here are the four basics that are required, although the words used to describe them keep changing, if you want to foster a culture of innovation.

• Open, honest, constant communications
• Never kill the messenger
• Accept and act on input from all levels
• Walk your talk

And the next time someone tells you that corporate culture is a myth composed of smoke and mirrors, remind them that there are still people out there who believe the Earth is flat.

Click for a direct download of “Radical Innovation in Firms Across Nations: The Pre-eminence of Corporate Culture.”

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Dave Zinger wrote a post on employee DISengagement, saying that it doesn’t exist; that it isn’t the employees who are disengaged, rather it’s the organization’s responsibility to engage them and he’s right on the money.

Engagement isn’t something that happens by accident or that you can order your people to do.

Engagement happens because you, and hopefully your company are engaging.

This isn’t doubletalk or smoke, think about it. Think about what engages you.

• The guideline is the same thread that has run through every major philosophy and religion for thousands of years—treat your people s you want to be treated, whether your boss treats you that way or not.

• Authenticity is the current buzz word, but it translates simply to be honest, open and do what you say; never fudge, let alone lie, intentionally or otherwise.

• There are absolutely no circumstances that warrant or excuse the messenger being killed. None. Because if you do, there’s no going back—ever.

• If your company doesn’t have an engaging culture then you must be an umbrella for your people, because you can create one below you, even if you can’t change it above.

Organizational engagement is cultural and we’ll be talking more about it this week.

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A lot of interesting stuff makes the rounds of the Internet. I received this scan and tracked through Google to Snopes (I love Snopes).

These remarks were made spontaneously  on a Voice of America broadcast that was heard in more than sixty countries.

It would be very cool if it had really happened in 1968, but that was literary license; the broadcast actually took place in May 1961.

But the seven years difference doesn’t matter. What matters is that his comments were prophetic and came true in far less time than many believed possible—right up until last week.

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Employee engagement is a hot topic these days; it’s also a function of corporate culture. And while managers may not be able to control culture there are many things they can do within their own department and even team.

One of the biggest is to show your appreciation of your people. Study after study confirms employees’ desire to feel valued; to make a difference and be credited for it. But how, with budgets cut below bone level?

Here are four simple actions that you can implement at no financial cost and that don’t require approval from anyone.

• Ask everyone, not just your so-called stars, for input, ideas, suggestions and opinions.

• Listen and really hear the response, discuss it, think about it.

• Use what you get as often as possible, whether in whole or in part, or as the springboard that leads to something totally different.

• Credit the source(s), both up and down, publicly and privately, thank them, compliment them, congratulate them.

If you’re sincere, you can’t lay it on too thick; if you’re faking it, they’ll know.

And if you’re foolish enough to steal the credit for yourself in the mistaken name of job security you’ll have the fun of explaining to your boss the plummeting productivity and soaring turnover that accompanies those thefts.

It’s easy to remember, just think ALUC.

Ask

Listen!

Use

Credit

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A couple of weeks ago David Zinger wrote a great post regarding the so-called war for talent.

“I have always been troubled by the so called “war for talent.” Now, I am beyond troubled, I am angry with the use of this metaphor for those of us who offer our best in organizations.”

Take a moment to read David’s comments—they are provocative, true and well worth the time.

But I want to focus on something else today.

I have a major problem with ‘talent’—and human capital and human resources and stars—but especially with talent.

As a manager, you do not hire talent, capital, resources or stars.

You hire people.

The people you hire are rated, in the majority of cases, ‘talented’, or even ’stars’, as a direct result of the skill with which you manage them.

I spent more than 20 years as a headhunter and I’ve seen below average employees turn into innovative contributors when exposed to a different manager and the opposite, when acknowledged stars suddenly become non performers because the management changed.

Actually, you don’t really hire people, you hire persons. Individuals with all the quirks, foibles, idiosyncrasies and idiotsyncrasies common to the human race.

And you hire them one at a time.

No manager ever hired a ‘workforce’; they built it, one person at a time.

Plural pronouns not allowed.

So no more talk about talent or resources or capital. Your job is the acquisition, care and feeding of your persons.

And why in the world would you involve yourself or your persons in a war?

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Jim Stroup over at Managing Leadership wrote a fascinating post on the effects of principles and political compromise on our Constitution.

For the political slant click the link, but I think that these ideas are just as true in the business world.

“If you rule out compromising your principles, then you become an ideologue.”

Can business people be ideologues? Of course.

Managers adopt approaches and then rigidly try to implement (inflict?) them on every organization in which they work with no consideration as to their appropriateness.

Robert Nardelli did that when he tried to impose stringent metrics a la GE on Home Depot, ignoring cultural differences and the realities of running a successful consumer business.

“…maybe they see a higher, joint goal of sufficient value… This sometimes takes a kind of discipline, stamina, and focus that can be stunning, and much more productive, powerful, and enduring…”

When senior managers open themselves up to input from all levels of their organization—instead of forcing the dogmatic use a certain methodology—the results include stronger engagement, higher productivity and more innovation.

In business, this means a focus beyond today’s stock price—a focus on the long-term, which is rarely appreciated by Wall Street.

Compromise isn’t synonymous with ethical lapse, either; it’s not an excuse to lie, cheat, steal or fudge the information or the numbers.

It is about listening to others; listening to those whose ideas are revolutionary; ideas that are atypical; ideas that buck the norm and go in a new direction and that takes a lot of guts.

In business, as in politics, compromise often means being willing to put your job on the line—but refusing carries the same potential cost.

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For years I’ve pushed my clients on the importance of communicating bad news along with the good and in the summer of 2006 I wrote a post about it.

Convincing executives that sharing bad news is as necessary as sharing good is similar to discussing global warming. Most agree that something needs to be done, but that doesn’t necessarily translate into action.

What’s forcing them to act is Web 2.0 and a multi-generational group of web-savvy folks with a belief in transparency and a willingness to spend their time promoting it using blogs and Twitter.

“Elon Musk, chief executive of the electric-car company Tesla Motors in San Carlos, Calif., said that he had no choice other than to blog about the Oct. 15 layoffs at the closely watched company…[since] Valleywag, a Silicon Valley gossip blog owned by Gawker Media, had already published the news, and it was being picked up by traditional media reporters. “We had to say something to prevent articles being written that were not accurate.”"

That’s it in a nutshell.

Much of the transparency trend started with activists who created websites about companies where people could comment, make suggestions and vent their frustrations; now it’s pushed into the tech startups of Silicon Valley, but laggards in all industries are being dragged kicking and screaming into the new reality.

“Every industry has Web sites that cover its companies and eagerly publish rumors, from the Starbucks Gossip blog to DealBreaker for the financial industry and BlueOvalNews.com for Ford Motor. Web sites like Glassdoor.com and JobSchmob.com also encourage workers to vent about their bosses.

Larger companies need to learn that lesson, too, said Andy Sernovitz, chief executive of the Blog Council, which helps big companies use social media. “There are hold-out companies that still wish there was traditional P.R. control of the message, but that day is long over.”"

The only thing a company can do that’s worse than silence is to lie or fudge the truth.

Many years ago a rumor started at a Siemens facility in Arizona that the company was going to move to a new location about 70 miles away. The management hotly denied it and many of the engineers who they relocated there trusted them and bought homes. About nine months later the company did indeed move and most of those people lost money when they had to sell their homes to keep their jobs.

Lies aren’t smart, but this one was particularly stupid and unnecessary; the story outlasted the executives who did it and tainted their recruiting efforts for years.

The moral is simple—tell the truth, without spin, and tell if first.

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