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Personnel problems lose you about $15.5M/year

Personnel Problems

Pretty much an open secret that most executives could care less about personnel problems, i.e. people issues, opting to kick those deals to HR. HR is a joke at most companies — we call it “human,” yet it’s automated beyond belief now — and because it doesn’t generate revenue directly, no one running a for-profit cares at all. It’s just a giant loop of personnel problems persisting (alliteration), no one doing anything that would solve them, and most people burying their heads in the sand about how busy and important they are. Welcome to work in 2017, baby!

We had some research a few weeks ago that bad leadership costs companies $144,000 per day. Important caveat here, though: none of this is really trackable on a balance sheet. Hence, people don’t care. The guys that come to run organizations love them some “Spreadsheet Mentality.” Show me Row D56 and tell me how much money I just made. That’s all that matters to a lot of guys. This is “the game.” It’s the closest thing they have to genuine fun.

Well, now we’ve got some research showing that personnel problems hit you in the wallet to the tune of $15.5 million per annum. For an enterprise company, that’s nothing. They probably spend that on toilet paper. But to a mid-size or small business? That’s a lot. And I guarantee you those places have personnel problems too. We all do.

The monetary research on personnel problems

It’s from a professor at Northwestern and one at Ohio State. They classify spending issues into Type I (spreadsheets, financial documents) and Type II (wasted time). The Type II hit to companies is $15.5 million, hence the figure above. All the research is here.

“Wasted time” would mostly imply meetings and calls, which is logical. That’s (a) how a lot of first-world work is “done” and (b) just the lowest form of humanity possible. No one ever prepares for a fucking meeting — they just race in from the last one — and as a result, they’re almost entirely useless. You can use meetings to get better ideas from people, but most people who “own” meetings don’t think of them in this way. Meetings can also be “strategic,” but again, it’s not very common.

So basically, you take all these people probably making inflated salaries — and then you stuff them in worthless time-wasters all day. That’s Tier I of personnel problems. That’s hitting you right in the wallet.

What are the other tiers of personnel problems?

This research found three:

  • Managers who like to win
  • An over-focus on teamwork
  • Too much expertise

Ding, ding, and ding. These are all common problems. Let’s go one-by-one and solve ’em up, yea?

Personnel problems No. 1: Managers who like to win

America just took a bath in this shit. Trump, baby! “The best people, we’re gonna get the best people. I’ve had the best shows, the best books, the best buildings…” Here’s the problem. We all know it but don’t discuss it openly. America is an achievement culture. Achievement is different than fulfillment. Your life should ultimately be about fulfillment, but the argument in America is that you need to achieve to feel fulfilled. That’s largely a crock of shit — $76,000 a year makes you feel as happy as $10M, per research — but we buy into it. (And yes, $10M means you can probably do some cooler stuff with your time.)

This “likes to win” culture plays into the high achiever myth, and that’s one of the many factors that just handed us “grab ’em by the pussy” on a platter. Win, win, win! When your culture — fluffy term no one cares about, kinda like “personnel problems” — is all about winning, nothing ever gets done. Managers are afraid to ask for help, ask questions, or collaborate on problems. The idea is that if you show weakness, you didn’t win. We’ve all seen these workplaces. They’re disgusting and horrible.

Most managers think of personnel problems as “I don’t like this specific person because he/she isn’t like me, so let me force ’em out.” (Wrong.) Most managers also think of achievement as “My bonus better be fatter than that fat pig Rosie O’Donnell.” This is all a giant problem. We’ll solve it in one second.

Personnel problems No. 2: An over-focus on teamwork 

Dirty little secret No. 1: collaboration hurts productivity. Dirty No. 2: most people don’t even want to collaborate. Problem: we force people into teams, then promote individuals. Motivation suffers. This all creates a bunch of personnel problems, including everyone’s favorite discussion. What’s that?

“We wish we could give you a raise this year, Tommy. The money just isn’t there. Next year!”

“But with all due respect, sir, I manage the budgets for you. I know there’s money there.”

“Next year, Tommy!”

At 4:55pm that day, you see your boss pull out in a brand-new S-Class.

Personnel problems No. 3: Too much expertise

Most companies still let senior leaders also act as individual contributors. This is massively flawed. Now you’ve got a guy making $220K sitting in a meeting. He’s the furthest from the customer, but because he makes the most money, he feels he needs to talk. His “expertise” — which is usually rooted in nothing, because hierarchy should be inverted to make any sense — thus clashes with (a) realism and (b) the expertise of other guys who make too much money. In essence, this is the “key stakeholders” problem of modern work. There’s 15 so-called experts, and the rest of us have to (a) please them and (b) figure out how to actually execute on work based on all the expertise they’re lobbing at us.

How do we solve personnel problems?

Here are a couple of different ideas.

Idea 1: Remove ownership of personnel problems from HR. No one cares about HR. It is not tied to money and people care about money. Create a new department, rooted in data, that looks at people issues and sees what the revenue hit is. Call it “Person Analytics” or whatever you want. Tie people issues to money. Then others will care.

Idea 2: Stop promoting assholes up the chain.




 

Idea 3: Create programs — dare I say “safe spaces” — so that people can be their real selves at work, instead of being the heads-down, Saab-driving pigs the execs want us to be. And then …

Idea 4: Instead of trying to “fix” employees into what you want, focus on their strengths and build from there. From there …

Idea 5: Promote teams instead of just individuals. While you’re at it …

Idea 6: Do not let your senior leaders also be individual task contributors.

Idea 7: Focus on the work, as opposed to just the wins.

I could do this for days. I will not. You are spared!

Look: personnel problems are about people and how people react and process the work around them. You cannot solve these issues with technology, or process, or PIPs, or whatever else. And not solving these issues is losing you money. You want money, right? More of it?

What else might you add on personnel problems in the modern workplace?

Ted Bauer

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