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Leadership

The Most Pervasive Problems for Women in the Workforce

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Although major steps have been made toward gender equality over the past decade, women still face many obstacles in their professional lives. Women make up half of the workforce, yet it’s harder for them to find employment, earn raises, and land promotions. This is true in many fields and industries. Here are some of the most pervasive problems for women in the workforce.

Hiring Biases

A joint study by professors at Columbia University, Northwestern University, and the University of Chicago revealed that two-thirds of hiring managers in the tech industry chose male candidates even if the female candidates performed the same or better than the male candidates. Similar studies showed the same bias is present in the sciences and in the corporate world. People of all genders have an unconscious bias toward men, assuming men are more competent than women even when they have no evidence to back it up.

Promotions

One of the biggest problems women face in the workplace is recognition. Female employees have to work harder than their male counterparts for their managers to publicly praise them. They are also overlooked for promotions. Many female professionals feel like they don’t have a fair opportunity to earn promotions, having noticed that their male colleagues often received promotions before them even if they have less experience.

Gender Pay Gap

On average, men are paid more than women for the same work, even when they have the same educational and professional background, work the same hours, and have the same responsibilities. Since men are often more likely to receive raises, the pay gap experienced often increases over time. A study by the WAGE Project suggests the average woman with a BA will receive a third of what a man with the same degree makes over the course of his career.

What Can Organizations Do?

First and foremost, companies should actively work on making their processes for hiring and promotions objective and unbiased. Many managers are unaware of the biases they have, so the best way to approach decisions is to leave no room for subjectivity. Companies can also establish mentorship programs for women in the workplace and be proactive in hiring women for leadership positions. Organizations with more diversity in their leadership tend to perform better, so it is a win-win situation.

Gender inequality is a huge challenge in contemporary work culture. In most fields, women are less likely than men to be hired or promoted. They also tend to receive less money than men for the same work. If companies want to attract and retain the best talent, they need to rethink their approach to gender equality and take clear steps to reduce bias in their practices.

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The Stress Test

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Countless articles have addressed one of the most important tasks given to senior leadership within any organization: the ability to identify the next generation of future leaders within the firm. We look for passionate individuals who wake up each day craving success and can channel that passion into actions and results. We seek out creative thinkers who are intensely curious, identifying those who naturally crave answers and alternative ways of approaching problems. The trait of true grit is valued within an organization. We respect those who have the strength to learn why they failed, what to do in the future to succeed, and the willpower to get back on the horse and try again.

Research on the topic reveals another crucial attribute as it relates to identifying future leaders: the stress test. Great leaders always seem to have the ability, at least in appearance, to remain calm during situations that make most of the general population fall to pieces.

Why the Stress Test?

Drama in the workplace is the enemy of productivity. Incessant venting can create an emotionally exhausting experience for all involved. Individuals who react, instead of respond, typically do not endear themselves to others within the team.

Alternatively, good leaders can keep cool even when the situation provokes an emotional reaction. But great leaders also help everyone else stay calm and contribute to the imminent situation and impending objectives. There is a difference between managing one’s self and managing the reactions of others, and the two don’t necessarily go hand in hand.

Within the workplace it is common for individuals to achieve promotions based on their commitment to personal success early in their careers. As individual contributors, they can produce more simply by doing more. They can choose to work harder and longer, and to be more productive. There is a tremendous amount of control and correlation with the relationship between effort and outcomes. When promoted into leadership, one suddenly becomes responsible for the work and success of others. Leaders’ efforts alone are often insufficient to achieve results, especially if they lack the coaching ability to adequately influence others. Thus, the stress test is relevant not only for one’s capacity to manage personal emotions, but also to transform the dynamic of the entire workplace.

Screening for Stress

It is commonly known that individuals put their best foot forward throughout the interviewing process – both applicants and hiring managers alike. When do you really get to know what is underneath the surface? What combination of behavioral-based interviewing questions and situational scenarios should we use in order to see a candidate’s true colors under stress? The subject of engaging a candidate in awkward situations in an interview is not widely accepted, likely for good reason. Sighing or interrupting candidates while they are talking, acting aloof and not paying attention, or repeating questions to see if someone gets frustrated doesn’t lend itself to an attraction-based recruitment strategy. Consider some of the following questions to evaluate aptitude:

  • It doesn’t seem as though you have enough experience for this role. Tell me why you believe we should hire you, or why I’m wrong in my assessment.
  • I don’t think I understand your answer. Can you please explain it differently?
  • How would you handle putting in a couple hours of overtime after a busy, stressful day?
  • Tell me about a time when you didn’t reach a goal. What happened, and what did you learn?
  • How do you prevent a situation from getting too stressful to manage?
  • What advice would you give to calm down a colleague who is stressed out about a deadline?
  • How would you deal with frequent changes at work? Client expectations change, a deadline gets moved up, new inexperienced individuals joining the team, etc.
  • How do you ensure that stressful situations in your personal life don’t affect your work performance?

Also worth noting is the dynamic between a personality type and the ability to cope comfortably with change or pressure. Some individuals are wired to embrace bold new ideas and the bigger picture, believing that risks are worth taking and love a challenge. Others are pragmatic, drawn by data and facts, and to whom details matter. Although the former may be naturally wired to deal with stress easier than the latter, it is possible to teach a key component of stress management: detachment. Teach individuals to avoid negative self-talk, the “what if” rabbit holes, and to slow down and breathe. It is possible to coach emotional stability, allowing employees to understand how to view a situation with a healthy level of detachment, process what is happening around them, and take helpful and purposeful action.

On the Brink of Burnout

Improving stress management capabilities is one thing but bringing employees to the brink of burnout is another. Create a healthy balance between high achievement and high enjoyment. Be spontaneous. This could be as simple as rearranging office furniture or hosting an impromptu casual lunch gathering. Instead of your next brainstorming meeting being conducted in the office, take a walk instead. You may be surprised as to how the creative moments can flow in a more relaxed setting. Ask individuals what they think. You do not always need to implement their input, but people want the opportunity to be heard. Know their personal and professional goals for the year and take responsibility for helping them achieve at least one or two of them yourself. Make progress on helping uncover the future potential of each player on your team. They put their careers in your hands and it is a responsibility, as a leader, that we should take seriously.

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Tips to Improve Your Time Management Skills

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When it comes to C-level support, time management is critical to performing at a consistent high level. It improves organization, focus, and productivity. Effective time management can help minimize work-related stress and anxiety. The following tips will help you improve your time management skills.

Quit Multitasking

Many people feel like they accomplish more when they multitask, but this is rarely true. Study after study shows that most people perform best when they devote their full attention to a single task. When we stop trying to multitask, we perform tasks faster, which makes it easier to meet deadlines.

Delegate

People often find it difficult to delegate tasks. They either feel like they’re shirking responsibilities, or they have a compulsion to be in control. Sometimes people just don’t want to take the time to train someone else how to do the particular task. Yet delegation is critical to time management. There is only so much any one person can do on their own. The key is to understand your skills and assets and those of your team members. This allows you to play on your strengths and those of the people around you.

Prioritize

Start each day by listing everything you need to achieve before the workday ends. Then organize each entry on the list by urgency. This will help you start your day with a clear mind and ensure that you complete all the important tasks that you need to complete. Usually our to-do lists are longer than the hours in the day, so you should always focus on the most urgent tasks first.

Avoid Distractions

We all procrastinate from time to time, but procrastination is the biggest obstacle to successful time management. If you have a difficult assignment, turn off push notifications on your phone, close your email, and forward calls to voicemail. If you surf the web when you want to avoid tasks, you can even set up software that will keep you from using your web browser during work hours.

Wake Up Earlier

People with great time management skills usually wake up bright and early. When you start the day early, you have time to sit down with a cup of coffee and plan your day. When you wake up at the last minute, you are in a rush to get ready. By the time you arrive at work, you are likely to be in a state of anxiety and disorder.

As a C-level support professional, executives depend on you to be organized and on top of deadlines. This requires well developed time management skills. The better you can manage your time, the more productive you will be.

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Make Self-Care a Priority for a Better Work-Life Balance

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Professionals in C-level support are so used to taking care of everyone else they often forget to take care of themselves. But with such a challenging job, you need to make self-care a top priority, or you will likely experience burnout. Here’s how to make self-care a priority and incorporate it into your daily routine.

Make a List of Your Needs

Start by making list of what you need to stay healthy. This includes physical needs like water, nutrients, sleep, and exercise, as well as psychological needs like mindfulness, community, and quiet time. The most common excuse people use to explain not practicing self-care is time. By making a list of your basic needs, you can more easily organize your schedule to incorporate healthy practices. Periodically reevaluate your needs. They change depending on what’s going on in your life at any given time.

Take Small Steps

Most people will find it difficult to completely change their behavior and lifestyle. Committing to self-care can be overwhelming at first, so start with baby steps. For example, start by drinking more water, then carve out time to start meditating or exercise. Eventually, you can address other issues like diet or sleep schedule. Don’t try to do it all at once. Eventually, you will turn these healthy behaviors into habits.

Be Kind to Yourself

Another reason many people struggle with self-care is that they believe they can’t do it. Society has trained us to concede defeat at the first sign of failure. For example, if you set a goal of meditating every day, you may feel defeated if you miss several days early on. You have to adjust your mindset. It takes time to turn behaviors into habit, so be kind to yourself and don’t agonize over every misstep. Everyone has the ability to practice self-care.

Remember Why You Practice Self-Care

As you work on making self-care a priority, always remember the why. You want to improve your health, reduce stress, and enhance your performance at work. Don’t rely too heavily on goal setting, schedules, and to-do lists. You also have to think about what you need in the moment. If you schedule in a hot shower in the evening as part of your self-care for the day, but you get home from work and can barely keep your eyes open, go to sleep. In that moment, sleep is more important to your self-care than a shower.

When you practice self-care, you develop better relationships with yourself, as well as your co-workers. You will also develop a more positive attitude, reduce your stress levels, improve your overall health, and increase engagement and focus. Take the first step and commit to making self-care a priority.

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African American Women Are Overcoming Barriers to Leadership

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As is true in many fields, there is a lack of diversity in leadership, especially when it comes to African American women. Still, some women of color are overcoming the barriers to leadership. These women know what it takes to succeed in today’s employment environment, and they share their unique insights.

Developing High Emotional Intelligence

Minority groups face a higher number of obstacles and barriers, so their resilience often becomes a driving force to succeed. This entails developing high emotional intelligence. When constantly judged by gender or skin color, it’s natural to feel anger and animosity. The key is to learn how to control your reactions and establish a strong understanding of who you are.

The women who are overcoming barriers learned to convey self-assurance even when people doubted them. In addition, when facing adversity, it starts to become easier to read people and situations. They learn to distinguish people who are prejudicial or close-minded from those who want to see them succeed. One leader who serves as chief financial officer says, “You have to seek out messages and people who affirm your identity.”

Understand Stereotypes

Society expects strong leaders to be autonomous, confident, capable, resolute, and ambitious. These are all traits stereotypically associated with men. Even though leadership styles can take many forms and gender stereotypes are inaccurate, these stereotypes create a bias that often works against women in the workplace. African American women have an even greater challenge because they also have to contend with stereotypes and biases associated with race. Once you understand the biases you face, you are in a much better position to counteract them.

Many professionals may be the only African American employee at their company, so they have an added attention put on them. The vice chair of an investment firm put it this way, “There are so many rooms I’ve gone into in my life where I was the only black person, and I immediately started to see that as an advantage. Because they’re going to look, they’re going to listen….They’re wondering how I got into the room, so I have an opportunity to get their attention. All I have to do is deliver into that space.”

Stay Genuine

One trait that most women and African American leaders share is sincerity. They know who they are and embrace it. They don’t change to please other people. It is systemically even more difficult for African American women to be honest about their professional and education background, because they are often judged more sharply than their peers. Despite this difficulty, it is always important to be candid about who you are and what you want. People respect honesty and frankness.

Overcoming barriers to leadership starts with establishing a strong sense of identity. At the C-suite level, women of color often make some of the best leaders. Even though they face more challenges than their competitors, their demonstrated resilience, high emotional intelligence, confidence, decisiveness, and sincerity drive them to succeed. As we slowly move into an era of more diversity in leadership positions, expect to see more women of color rise to the top.

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Desire to Inspire: Solidify Your Future as a Phenomenal Leader

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Motivate and inspire. The two words are often used interchangeably, echoed perpetually in the minds of any leader trying to spearhead the charge. However, view the two as the same and you are missing a critical component in your evolution as a senior executive. Why? Motivation is of the ego, while inspiration is of the soul. Knowing how to motivate can make you a phenomenal boss, while knowing how to inspire will solidify your future as a phenomenal leader.

“Motivation is when you get hold of an idea and carry it through to its conclusion, and inspiration is when an idea gets hold of you and carries you where you are intended to go.” – Dr. Wayne Dyer

Being inspirational can be a trait that appears to be intangible; you either have it or you don’t. It seems that individuals like Steve Jobs, Winston Churchill, Tony Robbins or JFK were most certainly born as charismatic and influential individuals. So if being inspirational to others is something we all want, but it’s something you are and not something you get, then inspiration must be impossible to teach, right?

Not quite.

Turns out, inspirational leadership can be built with thoughtful and measured practice. There’s even an incredibly easy place to start.

You.

Want to be inspirational to others? You must first be inspired yourself.

Think about it; reflect upon some of the individuals in your life who have inspired you. You’ll see a common thread between them all – you fed off of their enthusiasm. If you don’t know where you are going, how can you expect those around you to be inspired to join you on the journey?

Great leaders have a crystal clear vision for what the future holds, and they can articulate that vision precisely and with contagious energy. Martin Luther King Jr’s “I Have a Dream” speech is proof of his ability to paint a picture so clearly that it almost seems we are already living in the future state. To truly inspire, you must start from within:

  • What problem does our firm solve or service does our firm provide, and what’s our connection as to why that matters?
  • What are we building together?
  • Why is this team special? What makes us proud to be part of this unique collection of individuals?
  • What are my 1, 3, and 5 year dreams for my team? What will life look like then for all involved?
  • How does my dream connect on a personal level with each team member?
  • How do each of my team members want to be remembered in terms of the impact they had and the role they played in making a difference, both internally with peers and externally with clients?
  • What gifts am I giving to those I work with every day?

Highly successful people ask the right questions, and thus, they receive the answers that help them advance in life.

Change from the Inside Out

Focusing on motivation is the comfort zone of many in a leadership role. Motivation can be wildly effective as it forces us to keep up, compete, and compare ourselves to others. Motivation works as it compels us to take action, to push past limits, and do more than we thought possible. But motivation without inspiration is temporary, and it can become exhausting. Though motivation can drive results, inspiration drives the purpose connected to those results.

That connection is what keeps individuals tethered to a mission and a leader for years and decades to come. When a leader is able to reach in and inspire the hearts and minds of individuals, those individuals are changed from the inside out. When people want to take action because there is a deeply connected desire from within, that action is sustainable and infinitely more meaningful.

Perpetual Improvement

One of the strongest value propositions a leader can give to an employee is the ability for that individual to perpetually grow in all dimensions. The message that someone else believes in you, sees potential and growth in you, can be a powerful connector. Obvious areas of growth include professionally as well as personally, but do not overlook the importance of financial, mental, and spiritual growth as well. In nature, plants either grow or decompose; they do not stay the same. In an organization, nourishment is supplied by the broad term of training, but a more accurate term is learning. What is being done within your organization to foster learning, growth, and new perspectives each week?

Don’t be afraid to set your team free. Open the gates and let the human need for autonomy and significance flourish. People want to do well and succeed, but can sometimes be suppressed by your own need for control or cumbersome processes within the organization. Inspire others by giving them a purpose they connect with, a timeline for results, and the authority to act.

Hardest Worker in the Room

When the team is out of gas, you inject more fuel. When the team doesn’t know what to do next, you lead by example. Whether acknowledged or not, employees what to see a leader who is desperately hungry for the mission to succeed and will do whatever is needed whenever it’s needed to get the work done.

Don’t mistake this final point; this doesn’t mean you need to be the first one in and last one out every day without exception. In fact, many times the “busiest” people are the ones who simply manage their time the poorest. Unplugging or taking time off is important, but the team should be able to clearly see your dedication to doing the hard work to achieve success. You will be thrilled to see the byproduct of that dedication, when the rest of the team follows in your direction.

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Areas of Growth in High Profile C-Level Support

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Exceptional executive support is at the heart of any successful organization. High profile C-level support is experiencing growth in several major areas, including family office directors and chiefs of staff. Below is a closer look at some of the areas of growth in  high profile C-level support.

Family Office

C-level support has become increasingly prominent in Family Office Management. Family office directors and directors of operations—the people who manage the entire family office, estate, and staff, serve a role similar to a COO. Directors can help hire staff, manage property taxes and LLCs, and handle critical HR issues. High profile Family Office businesses need experienced support staff who understand the value of confidentiality and efficiency.

Chief of Staff

Chiefs of Staff serve many crucial functions. They assist with project management, communicate with direct reports, organize board meetings, help strategize, and act as the right hand to the CEO. They problem solve and manage direct reports, often shielding the CEO from direct involvement with issues that arise. The C-level support ensures day to day operations run smoothly and leadership remains organized, strategic, and productive.

Trends in Executive Support

Five years ago, these types of support roles were not being recruited for very much. Recently that has changed. These are not run of the mill executive assistants. Salaries for these roles range from $200,000 to $500,000. In this high-tech environment, the number of millionaires and ultra-high net worth individuals has exploded. C-level support professionals usually need advanced business and administrative degrees. Some even have Doctor of Jurisprudence degrees.

Business Experience

Support staff at this level also need a high degree of experience. Often this business experience comes from serving as an executive assistant and then growing into more operational roles. Most executive assistants at the C-level also have some legal background and understand business operations. These professionals may have worked as personal estate managers, director of operations, paralegals, or attorneys. Sometimes, executive support staff grew up in the world of high-profile executives and have established connections within this dynamic and high-stakes field.

Recruiting Top Support Professionals

In the past, people didn’t actively recruit for C-level support roles. But now as the number of high-profile millionaires has increased, executive support roles have become more important than ever. When hiring for C-level support positions, seek out professionals with extensive educational, professional, and operational experience, as well as a sense of confidentiality. A recruiter steeped in this world can help you find C-level support staff who fit well with the company’s culture, operational requirements, and the executive.

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How to Create a Perpetual Prime of Life

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As recruiters, we ask candidates a powerful question which typically elicits immediate pause, reflection, and authenticity in the answer. It is a question that catches most off guard, creates a feeling of nostalgia, and sometimes even prompts a smile. “At what point in your career did you feel most fulfilled? When did you feel you were truly in your prime, or at your best?” Unfortunately, more common than not, the answer is a story of the past. This creates a dual-sided dilemma; how do we expect others to be inspired by our vision and actions if we ourselves are not inspired by them? How do we create a perpetual prime of life for ourselves and for those we lead?

Perpetual Prime: Yourself

A commonly cited quote (original author contested) reminds us that “it’s never too late to be what you might have been.” It might help to know that celebrity chef Julia Child worked in advertising for the majority of her life and did not release her first cookbook until age 50. Legendary comic creator Stan Lee did not create his first comic until he was 39. Colonel Sanders of KFC fame did not start franchising his company until the age of 62. The individual responsible for inventing instant ramen noodles did not do so until he was nearly 50. However, this is not an article about the possibilities of succeeding later in life. It is about how to take the environment of previous success and push yourself to stay in it, year in and year out.

The best place to start is by learning from the past. What is your answer to the question above? When have you felt truly in your prime, and what circumstances were in play at that time?

  • Commonly, the following four statements are generally the answers we hear most often as recruiters:
  • I had a team around me and we were all rowing together, hard, to achieve a goal we all believed in.
  • I was busy, maybe even overwhelmed, but overwhelmed doing meaningful work.
  • I was tasked with a challenge and given autonomy but support to solve that problem.
  •  I was surrounded by a team or a leader who pushed me to be more, learn more, take on more and grow more.

Sound familiar? You might identify with some or all of those experiences, whether they are in the past or in the present. The remaining question is “what changed?”

As leaders, we are in a position of power – a position to recreate the very circumstances that once made us feel we were the zone or at our best. We have the ability to take control of the variables that put us in those situations and control of the variables that detract.

Consider instead:

  • What is our collective vision, and what can be done to make it a more purposeful goal?
  • What mundane tasks should be outsourced, freeing up time for the most fulfilling and highest gain daily activities as a leader?
  • What can you do to create an ongoing learning environment with new challenges to overcome?
  • Are you surrounded by the best, both peer-level and those on your team? If not, what changes need to be made?

It is normal to find yourself entrenched in the day to day routine of work, family, and life. Many people go through the day on autopilot of knowing what is expected and performing to that expectation. It is not necessarily easy or comfortable to take the time to answer the questions posted in this article and start to understand true aspirations, motivations, and desires. It is certainly not comfortable to initiate change and uproot unproductive teams or face the reality of uninspiring objectives, but it is necessary in order to create an environment in which everyone feels at their best.

Perpetual Prime: Your Team

Being a leader can often times feel like being a parent, where every word is heard and every action is emulated. That leads us to another question: who was the best boss you ever had? Most answers include things such as “he/she had a vision and could articulate where we were going and how we would get there” or “their impact was felt daily as they worked tirelessly towards our goal” or “he/she put me in a position to succeed and I felt there was a strong belief in my abilities and potential.” Sound familiar? Although we are all different, we are also often alike. Creating a professional environment in which your team feels they are all in their prime takes work, but it is not a unique challenge.

In fact, someone once felt it with you; think about it! The best boss you ever had took responsibility for inspiring you, for making you feel heard, and for believing in you at times more than you believed in yourself. As leaders, we owe it to those who have put their careers in our hands, and the formula exists for what to do. It has been done for you already in the past. In fact, Google has even made leadership a replicable quality! Google’s people analytics team started by researching the qualities that make managers great at Google and then built a training program that teaches those exact qualities. Once the program has been completed, Google measures the behaviors of the leaders to ensure that they’re making improvements and morphing into managers that Googlers want to work for.

We don’t need to make it as complex as Google has. Start with becoming the boss you most admired and recreating the circumstances that used to make you feel you were in your zone. So goes the leader, so goes the team; once you feel you are in a perpetual prime of life, you will be surprised by how many others follow.

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Retention Tips: How to Retain Your Best Talent for the Long Term

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Retaining your best employees is an essential strategy in growing your business. Poor retention drives up an organization’s costs and can negatively impact the team’s morale and confidence. Here are some retention tips to help retain your best talent for the long term.

Overcommunicate Expectations and Details

One of the main reasons new employees quit is because the job isn’t what they expected. Throughout the hiring and onboarding processes, overcommunicate expectations and other important details. New hires should know exactly what to expect when it comes to their job responsibilities and the company culture. Also clarify what their priorities need to be in order to succeed in the role.

Establish What it Takes to Accomplish Their Goals

Employees need to know what to do in their position that will allow them to accomplish their daily, weekly, monthly, and yearly goals within the company. Often, employees leave because they don’t see how they are contributing to the company in a meaningful way. Instead of putting out fires, they need to know they have a purpose. Part of your job is to communicate to employees clearly and consistently how the role will allow them to contribute to the company. If you make that clear from the start, then they will have a much greater chance of reaching (and exceeding) those goals and feeling the sense of accomplishment that comes along with that success.

Set Employees up for Success, Not Failure

To ensure that new hires are happy at the company, set them up for success from the beginning. During the onboarding process, help new hires understand what challenges they will face in their new job, and provide them with the appropriate resources, such as a mentor, to overcome these challenges. You also want to give them tools to learn about the company and their role as quickly as possible. Finally, you want to provide new hires with opportunities to socialize with their peers so they can start to feel like part of the team right away.

Give New Hires Time to Train and Attend Regular Meetings

The most common complaint that new hires have is that they don’t feel like they have adequate time for training and meetings. New hires need the appropriate amount of time to train and attend meetings so they can learn their role and learn what they need to about the company and its culture. Otherwise, they might not figure out how to perform their job fast enough, become overwhelmed, and leave.

Have a System Place

With the above in mind, you have a system in place for training new hires and providing them with the onboarding they need to succeed. You might also want to incorporate a mentorship program to help accelerate the learning process and help make the new hire feel more comfortable.

Retention is essential for a successful business. You need your best employees to stay loyal to the organization so you’re not wasting time and money constantly searching for talent. To improve retention, make sure expectations are clear, establish how the role will help them accomplish their goals, provide them with the tools and resources they need to succeed, and give them sufficient time to train.

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Loss Aversion in the Workplace

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Imagine this scenario: a colleague offers to flip a coin and give you $20 if it lands on heads. If it lands on tails, you give him $20. Would you accept that bet? For most of us, the answer is no. Behavioral science experts Amos Tversky and Daniel Kahneman performed an experiment which resulted in a clear example of human bias towards losses. The experiment involved asking people if they would accept a bet based on the flip of a coin. If the coin came up tails the person would lose $100, and if it came up heads they would win $200. The results of the experiment showed that on average people needed to gain about twice as much as they were willing to lose in order to proceed forward with the bet. This tendency reflects loss aversion, or the idea that losses generally have a much larger psychological impact than gains of the same size.

You likely experience this phenomenon daily. Have you ever purchased something knowing you’d likely return it, but the longer you keep it the more attached you get? Sending the item back now feels like a loss. The longer we wait to be seated at a restaurant, the harder it becomes to leave, because it feels as if the time we’ve invested would then be lost. The more we try to fit a new couch through a too-narrow entryway, the less inclined we are to give up and accept that we need a smaller couch, and the more steadfast we become in making it fit. It seems that sometimes we will persist with a belief or course-of-action long after it is rational to do so. We feel trapped by what we have already committed.

Although a fascinating piece of knowledge about human behavior, what does the concept of loss aversion have to do with the workplace?

As leaders, knowing that losses have a tremendous psychological impact can cloud judgement when it comes to truly evaluating employee performance. We have a tendency to double down with those we’ve invested time with yet who continue to underperform.

“B” and “C” Players

A less enjoyable component of management is the act of working with and coaching the perpetual under-performers. Every department has them, every leader has struggled with them, and some may even have a few who come to mind immediately. They are the few who we try to encourage, who we try to train, and for whom we hold out hope that change will come, but it can seem like an endless cycle of performance management and frustration.

We all recognize “A” Players. Within most organizations, there is even room for the competent, steady “B” performers who balance their work and personal lives while still performing a significant amount of tasks that need to be done. They stay in their lane, don’t require a great deal of attention, and they get the job done.

On the other end of the spectrum, “C” Players sometimes make up the smallest segment of the team yet require the most time and attention. They are the employees with a constant litany of excuses – a vehicle is broken, someone is sick, excessive days are missed, and the workload either gets passed to someone else or delayed altogether. They walk the fine line between “good enough to get by” and “fireable offense worthy of termination.” They are granted continual employment primarily because the act of hiring, training and managing someone you don’t know is sometimes more intimidating than continuing to deal with the perpetual issues of the presently employed “C” performer.

Stop Doubling Down

It’s time to step away from the fear of losing $100 and focus instead on the opportunity cost of not winning $200. The obvious unintended consequence of having a seat filled with an under-performer is having it not filled by a significant contributor. What rarely is considered is the impact on those who are current significant contributors; there is little more frustrating than having your own success consistently hampered by another person’s incompetence. If the majority of your team is working hard, producing great results with tremendous collaboration, what message are you sending by supporting the 10 percent who are doing the opposite? How long do “varsity players” want to be surrounded by sub-par athletes?

Beyond performance issues, it is likely time to top-grade when:

  • The individual is the central cause or perpetual perpetrator of office drama
  • Co-workers (or possibly worse, clients) have taken note of the incompetence
  • The employee has an apathetic attitude
  • He or she ignores actionable feedback
  • The individual handles emotions poorly, mistaking the work environment as a therapist’s office
  • You spend more than ten minutes a week, week after week, dealing with issues created by the employee

Toxic Workers, a Harvard Business School study of more than 60,000 employees, found that “a superstar performer–one that models desired values and delivers consistent performance” brings in more than $5,300 in cost savings to a company. Avoiding a toxic hire, or letting one go quickly, delivers $12,500 in cost savings.

Sometimes, it truly is best to return the item, leave the overcrowded restaurant, or succumb to a smaller couch. Instead of experiencing a loss, you might actually gain the improved morale of the entire workforce. Instead of experiencing a feeling of loss over time invested, you might actually gain more time to invest in those worth investing in. Instead of feeling the loss of an employee, you might actually gain a key contributor you would not have otherwise hired.

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