Unlocking the Secrets to Hiring Exceptional Talent
In episode 89 of Pit Stops to Podium, we sit down with Lou Adler, CEO at Performance-based Hiring Learning Systems. Adler's extensive background spans executive roles in finance and operations. With an engineering degree and an MBA, he transitioned to recruitment in the 70s, later becoming an Amazon best-selling author and featured expert in major publications.
The episode's focus revolves around Unlocking the Secrets to Hiring Exceptional Talent. Join us as Adler delves into key subtopics such as the concept of hiring for the anniversary date, employing the 'High Tech, High Touch' method to elevate talent standards, and expanding the talent pool through defining work by crucial performance objectives.
If you’re ready to learn from one of the best, then buckle up and hold on!
Is Achieving a Win-Win in Hiring an Imbalance from the Start?
A good start in achieving a win-win situation is finding out from the hiring manager what a new employee needs to do in order to be successful over the next year, and it's almost always a series of performance objectives.
The problem is that good candidates don't want to make lateral moves (financially) and/or accept jobs quickly, which is in contrast to what companies want.
In the end, you need to find a way to connect the needs and wants of the candidate and the company.
Applying “High Tech, High Touch” in Talent Recruitment
Building a workforce plan enables a company to know ahead of time when they will need new people for certain positions. This then creates the time to interview enough candidates for a satisfactory period of time. For companies, it's best not to hire when there is an immediate need as that can lead to hiring someone impulsively.
The best candidates are often the ones not looking for jobs, but rather ones who you can convince to switch jobs because the move would make more sense for them.
Defining Success Objectives for Hiring AEs and SDRs
The key is in understanding what the best employees do differently than other employees (i.e. what are the "tipping points" at each of the steps in the sales process?)
Then when candidates are being interviewed, their skills can be mapped/matched to the skills that are necessary at that particular company.
Connect with Lou
Brendan: Hey everyone, welcome to Pit Stops to Podium, the RevPartners podcast where we talk to execs who have competed and won in taking their companies from high growth to high scale. My name is Brendan Tolleson. I serve as the co-founder and CEO of RevPartners and I'm delighted to have with me today, Lou Adler, for this episode of Pit Stops to Podium. Welcome, Lou.
Lou: Hey, happy to be here, Brendan. Thanks for inviting me. Appreciate it.
Brendan: Well, yeah, hey, this is an honor. We're really excited to have you. And for those who may not be familiar with who Lou is, Lou serves as the CEO of Performance-Based Learning Systems, has written a few books. And we're going to talk about one of those during this podcast. But Lou, for those who may not be familiar with you or your best practices and principles around hiring, I'd love for you to share a little bit about your firm and kind of the origin story of how you got into recruiting and experiences led you to where you are today.
Lou: Well, let me give you the short version or else we could pay a couple hours to do that. But now we've got a company, it's called Performance-Based Hiring Learning Systems. We train hiring managers and recruiters and HR leaders around the world on how to hire better people. So that's the essence of it. The book is called Hire With Your Head. The concept is win-win hiring, meaning we hire for the anniversary date, not the start date. And that means the candidate is excited after a year and the hiring manager is excited the person was hired. after they've worked together for a year. And that is a hard outcome to achieve, but possible. But then we can obviously talk about what those issues are. My background has been an executive search for many, many years. But even before I got into that, I was running a manufacturing company when I was quite young, hated my group president. He and I yelled every other week when he showed up. He also didn't like the corporate politics. So I decided to become a recruiter, which was kind of a stupid decision at the time. But turned out that. because of that background in industry, it was very clear that recruiting could be a business process. From the moment you open up a rec, evaluate someone, hire someone, and manage that person on the job. And I think too many managers in any field think, nah, I can make a judgment, intuitive judgment, and hire someone. And it's a bunch of BS. It's a business process. If you do the same thing time after time after time, you'll get great results. not necessarily time after time after time, but most of the time. And that's really what performance based hiring is all about.
Brendan: And hence why the title of the book is Hire with Your Head, as opposed to Hire with Your Heart, I would assume. So, okay, that's great. Well, before we unpack that big idea, because I really wanna dive into that content, because, well, selfishly, we're in that process too, but I think it would be, you know, one of the traditions we have here at Pit Stops to Podium is to get to know our guests outside of work. And so just love to hear from you, Lou, in terms of those passions, hobbies, interests, or even your family that make you who you are outside of the work environment.
Lou: Well, I don't think you'd find much about that. So the best I can tell you, the best I can tell you, which pretty stupid is I was actually semi-retired because I'm 77. I was kind of semi-retired last year. Uh, and I, uh, when ChatGPT came out, I realized it was a game changer. So I've kind of unretired myself, but But irrespective of that, I did have a five-week RV trip plan from Southern California all the way cross-country, going to Savannah, and then coming back through Charleston all the way back. And so this will give you some hints of who I am. So the highlight, the highlight of that 7,500-mile trip was stopping in Buc-ees somewhere in Texas. And Buc-ees is the greatest place in the world.
Brendan: I was gonna ask you if you had a Buc-ees stop. How many Buc-ees did you go to?
Lou: I was actually going to reroute the whole trip to get back to another Buc-ees on the way back, but my wife wouldn't let me. So that's number one, is I really like Buc-ees.
Brendan: Did you get a brisket sandwich or a t-shirt?
Lou: Of course, I got a six pack of them. I brought them in the car and then I forced my wife, you got to go into this place. It's the greatest place in the world. So that, so that was the greatest thing, but now something else greater happens. So now you want to get into my personal life. So my birthday was on May 5th. We got back on like May 2nd or so, but my wife got me this surprise birthday present. which was a tour of SoFi Stadium. And it was great. 50 people. Then it was like a two hour tour. And then we go onto the playing field and I was throwing footballs, throwing, kicking field goal. Then it was great. Of course I pulled my arm and couldn't walk for a week, but, uh, so those are the two things, uh, Buc-ees and taking a tour of SoFi Stadium pretty much tells you who I am. But I really believe hiring is almost as important as those things. So let's leave it at that.
Brendan: For those that have never been to Buc-ees, just envision a Walmart as a gas station and that's what you'll experience.
Lou: With super clean bathrooms. I mean, the bathrooms are cleaner than the house. I mean, actually, we have the housekeeper coming by. I've showed her a picture of Buc-ees and I said, this is what we're trying to achieve here. She then quit.
Brendan: It's a fabulous business model. That company crushes it. Food's great. I didn't realize that you could have an RV in there because they're not allowed to have trucks in their gas station.
Lou: I'm not towing, an RV is 20 feet. I mean, they, I mean, a lot of, so we don't need to go any more into that, but we could.
Brendan: Are you a, given where you live, are you a Rams fan as well?
Lou: I'm kind of giving, let's say this, I'm a fair weather fan. I'm probably more a Laker fan, but they lose, I don't care. And the Rams suck it up, I don't care. So if they win, but I went to UCLA, get a graduate degree when John Wooden was there and Kareem was there. So I kind of have, those are where I feel the strongest. UCLA, Rams maybe, but whatever.
Brendan: Okay. All right, let's get into hiring. And that's a passion. The other passion outside of Buc-ees that you have that I think is probably most relevant to our audience on this conversation. And I really just want to, you know, when you talk about hire with your head, you already mentioned a little bit in terms of demystifying how to find great talent. And I don't think anyone would argue with you that you can't build a great organization scale without great talent. And so being able to create systems and process to drive more predictability in the hiring element is just critical for scale. And something you talked about at the very beginning was this idea of the anniversary date and making that a win-win And you had mentioned that's really hard to do and I think maybe let's start there in terms of you know Why is that we already about the head and heart? Let's talk about the implications of the win-win and why so often it's not a win-win because starting with the start date So it sounds like there's a imbalance whether one person wins or the other doesn't win. So let's start there
Lou: I think that's really the end game. So it's hard to start. I mean, you got to start there with the objective that, hey, you want to achieve success on both sides of the table. And most companies want to raise the talent bar and hire better people who are highly motivated and successful. I mean, that's kind of common sense. But then they post a job posting that basically is an ill-defined job that looks at best a lateral transfer. and they make people jump through hoops to get the job. Well, right off the top, a good person isn't gonna do that. So basically when you post a job, you're basically saying we wanna get an average person and hopefully they reasonably fit. Well, you're never gonna achieve a win-win hiring outcome on that basis. So if you look at win-win from a hiring standpoint, and I ask hiring managers when I take the assignment, what does this person have to do to be successful over the year? And it's always a series of performance objectives. In sales, it could be, hey, they got to make a quota within six months and then by year end, achieving X number of dollars with a growth rate of X percent. Fine. That's what that looks for them. Now you look for a top salesperson. Well, the top salesperson is going to do that, isn't going to apply to a job. They're already making that kind of money. So now you got to make the case is this is a better career move for this person. And yeah, they're going to probably take a hit in year one and year two, but in year three and four, you're going to do better. So you've got two. pretty powerful groups there making decisions. The hiring manager and his or her team, and the candidate and his or her team, which is the family, the friends, the advisors, and it's always about the money. If hiring manager is always about, I gotta be within budget and I gotta hire quickly. Well, the best people don't accept jobs quickly and they don't apply to stupid jobs. So the concept of win-win hiring is a strategic concept. You say, to achieve that, we've gotta do everything else in front of it. how we write jobs, how we source people, how we interview candidates, how we close deals, all of that stuff is essential. So now if I look at it from a sales perspective, and when I first started as a recruiter, there weren't a lot of sales training. There weren't a lot of recruiter training. So I went to sales training, and it was very quickly that solution selling was exactly the same what you needed. You've got to conduct the needs analysis with the hiring manager in the company, and you've got to conduct the needs analysis with the candidate. And that's kind of a slower process. And then you got to say, okay, can I make those two things fit? And that's not an easy decision, but that's really the metaphor of how you kind of achieve a win-win hiring outcome, how you define work, how you find candidates and it goes through. And even after they start, how do you onboard them? How do you train them? How do you develop them? Uh, that's kind of in a nutshell of why it's important and really why it's the end game. But then if that's the end game, how do you pull it off? And that's a strategic kind of a concept.
Brendan: Yeah, when you talked about the defining, the work, and the candidate, I think to me that's just creating clarity. Or to oversimplify it, but you're creating clarity for the manager and understanding what he or she truly does need. And then who can fulfill that function. And to your point earlier, if you're hoping that candidate will just show up through some type of application, you're probably, I think as you described it, but you're not going to find that high achiever that you ultimately want for that role.
Lou: Well, yeah, it's luck. Unless you get somebody on the bad day. So you get a great person applies. I just had a bad day at the office. You just for sales, you just lose the big account and you didn't get the support from the support team and the boss didn't do something to help close the deal, so you're aggravated. So then you look for another job. That doesn't happen that often, but, and two days later, the person. is no longer looking. But if you get them at that moment, so that's kind of, if you look at from a sales lead, that's how you got to lead. I mean, that's not the way to build a sales organization is to focus on these happenstances. But if you do get it, well, you got to move fast. You got to close, which is not the way good people make decisions. So it just seems to be a silly tactical process to hire a great sales team. So I don't care if it's a sales team, an engineering team. market doesn't matter what group it is. They all have similarities to, Hey, I'm making a major career decision, uh, from a candidate's perspective, the best people are slower. So, okay, I got a map to my, my customer in this case is a top performer and how they make decisions, not how average people make decisions. And I don't think you, a job posting is you get the best of an average person. That's a different mindset.
Brendan: Yeah, I like that thought and using the sales metaphor, it's you can't scale on bloopers. And so it's figuring out how do you apply kind of a science, a scientific methodology for how you're able to kind of attract and retain top talent. And so one of the things you talk about in your book, and we mentioned a little bit earlier around raising the talent bar, is this idea of high tech, high touch. And so what do you mean by that? And how can our audience really apply that into their process?
Lou: So let's assume I call a candidate up. And I call you up and, hey Brendan, would you be open to explore a situation that's clearly superior to what you're doing today? Because that, and let's assume I got your name from a referral. And you might say, well, yeah, but what's the money? Because that's kind of a knee jerk reaction. I say, Brendan, it doesn't really matter what the money is. Let's first see if it's a career move. Then you say, what's a career move? And I talk about all the factors that would achieve a win-win hiring outcome. Whether it doesn't matter. It's. Do you want to do the work? Do you like the company? Like the product line? I mean, there's a host of things that go along with it. That process, if I identify you on day one, through an interviewing process, practically speaking, it would take two to three interviews, total of six to eight hours with everybody interviewing, probably three to four weeks before you make a decision. So that's... And that's if you can start on day one, finding the candidate. I probably took me three weeks to get you as a candidate to make the call. So companies, we don't have that much time. Well, I make the cases by spending more time with fewer people. I probably could still get the deal closed from four to six weeks from the day I got the search assignment. But even more practical than now than that is I knew six months ago that we're going to need 10 more sales reps or three more engineers. or customer support group. I already knew that because we built our business plan six months or a year earlier. So it's this kind of a planning is, hey, I have got to build a workforce plan ahead of time. So I know in Q2 of 2023, I'm going to need 30 sales reps and I'm going to need another customer support team and I'm going to need yada, yada. But nobody, most people in the hiring business and even hiring, they react to it. Oh, three people quite a guy to hire. Well, you knew they were going to quit because you have a turnover ratio of 14% every year. So it don't. I mean, it's just the idea of thinking is like a business process. My background is in manufacturing. So my first degree is engineering. I got into finance and accounting, but it's in manufacturing and cost controls and planning and budgeting. Uh, and you plan all this stuff out. It just seems like in hiring, no, let's just do it. We'll just do it random. We'll hire one we need. We'll do it the way we want. Uh, and yet that's the way it happens. And it's been this way for a long period of time. So when I first got into recruiting, which is an odd story, but neither here nor there. I just realized there is a business way of doing this in a logical fashion, but you have human nature impacting that. You got human nature of managers who want to hire quickly. You got candidates who only look for jobs when they're depressed, and yet that's not the group you want. You want to do it slow and you want to hire candidates who aren't depressed. So I actually like to find candidates who aren't looking for another job and convince them that the one I've got is better than what they're looking at. That's a different mindset.
Brendan: It reminds me of we had a gentleman named Sangram on the podcast. And he was one of the co-founders of Terminus who was instrumental in the account-based marketing approach to go to market, meaning you have a finite amount of customers and you go after them with a higher conversion rate. And a lot of those principles apply to what you're describing, which is instead of like a huge funnel and have a higher, you know, a low conversion rate and probably a higher attrition. with people coming in, let's be tactful. And a lot of it comes from that first point, which is clear definitions of the role and the candidate to drive a much better outcome for both sides.
Lou: I pre-qualified candidates. I only want to talk to candidates who can do the work and have been recognized for doing the work. And they would see the job as a career move. Why would I talk to anybody I can't close? I mean, why would I go after a director of a big company with another director job and offer an ill-defined lateral transfer? It ain't going to happen. I mean, so you got to think, so it's exact thing is. most recruiters and most people don't pre-qualify who they talk to. I don't have time to talk to everybody. Just as you said, it's, I got to narrow the funnel to people who are high likely either will take the offer or could give me a great referral. I mean, that's kind of like, but it is a sales concept.
Brendan: Well, let's get into the last topic, which I think would really help our audiences. For those, when you talk about the definitions, we talk about performance-based objectives. I think some of our audience may not even, I think if they hear that go, I love that idea, but I don't even know where to start. I'm like, I don't even know what my objectives should be. You know, based on your experience and let's isolate to a sales or let's just, let's focus on on sales. Like if you're talking to, Hey, VP of sales or. You're looking at bringing on AEs and SDRs, and you have to bring on quite a few in the next year. How should they be thinking through what objectives would make this candidate successful?
Lou: Okay, so let's just, yeah, let's just take one. Well, you're looking for an account rep. So I'm going to say, okay, tell me what success looks like six months or a year from now. They've got to be able to consistently make quota in nine months, fine. I say, so let's work through that process. Walk me through the learning process and what does success look like when they learn the product. Walk me through... the account development process. Do they develop their own leads? Do they do the territory mapping themselves or they get the leads from the SDRs? Walk me through that process. Uh, how do they qualify leads? Walk me through the methodology and qualifying. So I, what I'll do is I'll go through that sales process step by step by step and understand what the best people do differently than the rest at every one of those stages. And then I'll say to the sales VP, okay, where, what are the tipping points? What are the tipping points? in this issue. And I remember this is probably just before COVID. It was real interesting. With a group, it had to be account reps. It was up in Santa Monica, California. There's about 30 people and it was a real, real high tech company selling software solutions. And it was, I guess, I think it was the customer support, the first person who had the intake meeting with the client. And I'm a little bit vague here, but I basically said, and the account support person was really the farmer. They had a go into account, the deal was closed, let's say it was 10,000 a month for a piece of software, but a good support person could increase that to 20,000 a month by year end. So I then just said, so we've mapped that whole process out step by step by step. So then I'm asking a whole group of people, I said, who is the best here in the room? Because these people had done that. Who is the best people in the room here who've done this work? Because I want to understand the tipping points at each of these steps. Some of the steps were tactical. Some anybody could learn them, but some were critical. And one woman, she's, and everyone pointed to this one woman. I said, okay, what did you do differently over the course of this? And she said, I knew in that first intake meeting, which customers I was going to spend time with and which ones I was just going to give a low level maintenance to. And she just basically said is when I conducted the intake meeting, I knew who the high maintenance accounts were. I understood their business. I could recognize that people. would buy this basic piece of software, which was some kind of schedule. I don't exactly know what it was anymore. Uh, but I then could tell this was a team that could easily use more products. And I would probably meet that group once a month versus everyone else, uh, 15 minutes every quarter. And that was just interesting, but any sales process can be done that way. You Britain benchmark the entire sales process and then understand what the tipping points are and what the best people versus the rest do in those points. And when you're interviewing a candidate. I just hate candidate walking through your biggest sales process. Walk me through step by step, how you got there. So I just map the candidate's success to that. What I know is on the job success and quite honest, I mean, I don't say it's easy. So I don't want to minimize that, but at least it's there's a scientific or business solution that gets you the right answer more times than not.
Brendan: Yeah, I really like that process because what I heard you say is when you map it out, there's some form of like data that's informing what is, as you mentioned, the benchmark. Like what is a base or what should we be measuring against? And then, hey, who are the top performers? And then to go to those top performers, I think one of the things that I've found is oftentimes the top performers, it's intuitive to them. But intuitive is implying that there is something that's driving the decisions. And in your example with that CS person, there's something about that handoff that they said, I know whether this is a high maintenance or not. And so there's something that's causing him or her to make that determination and it's unpacking what those reasons are to then create that contextual layer to understand who's the right candidate or what makes that candidate successful in that role. So I really like that process.
Lou: Yeah, it's really in many ways, I think a good sales rep gets blown out of the weeds if they don't know the product. Well a good recruiter gets blown out of the weeds if they don't know their product and the product is the company, the job and that hiring manager. So there's a real direct analogy and I don't think people see that when they're hiring. And yet it is, you're selling a complex product to a sophisticated buyer. but you better know the ins and outs and how that buyer makes decisions. There really is a direct comparison and every step of the way can be done in some kind of parallel analysis.
Brendan: Well, I really enjoyed our time together, and I know our audience has too, in terms of how to really demystify, how to find, attract, and retain top talent. And oftentimes it feels like a gut reaction or intuition. And I think what your encouragement here is there actually can be a science applied to this, and everyone can benefit from that. So if our audience wants to learn more about your approach, or one of your books, what's the next step they can take?
Lou: Well, I think the best way to do it is go to hirewithyourhead dot com. Hirewithyourhead dot com. We have a book club, so that'll get you to the book club. Uh, and you can every month or every four to five weeks, we take a chapter in the book and peel it apart and dissect it and kind of talk about it. So, uh, and we cover issues like we've talked about here, putting it all together, but that's a, the easiest way to find me is at hirewithyourhead dot com.
Brendan: All right, HireWithYourHead dot com. Well, Lou, I really appreciate the time. This has been a lot of fun. And yeah, really appreciate you coming on board.
Lou: Great. Happy and I hope to see you at Buc-ees someday. Bye now.
Brendan: Talk to you later. Thank you.