by David Harder
Adam Miller was named Entrepreneur of the Year by Ernst & Young in 2011 and CEO of the Year by the Southern California Technology Association in 2009. He lives in Los Angeles with his wife and three children. He often tells the media that becoming a father became the wake-up call that pushed him to make Cornerstone as successful as possible, because time away from his children had better count.
We joined Adam in his office with Deaira Irons from marketing, a recent addition to the team who personifies all the company looks for: bright, alert, interested, and kind.
I gave them an overview of what is happening with employee engagement and why the global numbers are so dismal.
Adam: You mean they can’t keep up with the changes in their jobs?
David: They can’t! Most of the existing processes to end disengagement are like using a teaspoon to put out a fire. The ability to personally transform is the new game in being relevant for any length of time, and until we help all workers build the skills of self-change, matters will only get worse.
Adam: We’re in the 13 percent.
Mary: You built this on a different philosophy than many companies out there.
I read the characteristics of an Engagement CEO.
Adam: There is one missing characteristic.
David: What’s that?
Adam: Shows respect towards all employees and learns from all of them.
David: Were you like this your whole professional life?
Adam: I worked in investment banking years ago, and it was the antithesis of tech culture. It is more of a feudal system where you become a leader by how much money you make rather than how you treat people.
Mary: Punish the serf in the way you were punished when you were one.
Adam: Exactly. You would give people literally busy work. People would get assignments on Friday afternoons and told it had to be finished on Sunday afternoon or Monday morning. Many were expected to work all-nighters once a week or multiple times in a week. I remember coming into the office when it was smaller and one of the developers was bragging that he had stayed up all night. I told him that if he did it again, he would be fired and that people are never productive when they pull 20 hours. Much of what he wrote would have to be rewritten because he was so exhausted.
This culture with Cornerstone really began in the beginning and it was in opposition to what I had witnessed. We were committed to a balanced workplace. It was a little bit later in our existence where we articulated our culture. When we had 30 people, we knew we had a culture but it hadn’t been defined. There was a turning point when we had 50 and would triple that number by the year end. New people would outweigh us 2 to 1. We formalized the culture. That began with the kind of people who work here who are smart, cool, dependable, and visionary. We believe in teamwork and client success. We were very clear about that, and then over time, found ways to infuse those qualities throughout the organization in how we hire people, how we develop them, how we fired people, how we did performance reviews, and how we recognized others.
David: You were directly involved in all of the early hires.
Adam: Yes. I hired the first 250 people. I personally hired all of them. After 250, it became impossible. My job became entirely interviewing.
I stopped hiring the individual contributors and hired the managers...we have over 2,000 employees, so it just isn’t feasible to continue hiring employees. I do the final interview for people that are critical for representing the company in certain ways.
David: How do you hire people that are going to protect your culture DNA?
Adam: Early on, I hired the managers. I selected the ones that would hire others. I loosened up when they proved themselves. For a while, I was the last interview. By the time they got to me, they were already meeting performance and technical requirements. But, I rejected quite a few candidates, almost always on culture fit. Periodically fights brewed about that because it was so hard to find someone. But that persistence built the standards.
Mary: It is rare, uncommon that at the top of the organization, the quality of the culture is viewed as such a significant asset where they are often primarily focused on other strategic elements. So, they push those culture pieces over to the human resources and talent people. The results are an ill-defined and squishy culture.
Adam: Our talent professionals are among the best brand ambassadors for Cornerstone because they are the ones doing a wonderful job of finding and attracting the talent we need to join our team. They are the ones upholding performance management and growth. Other things we did in our early days set the standards. We had a top performer who I fired because they were a bad culture fit. That was the first time when people took culture seriously. Here was a top asset that was not a fit with us. It didn’t matter. It was established early on that the team is more important than the individual.
David: In an earlier interview, you said that by opening in Los Angeles you were put in the position of having to hire potential rather than experience.
Adam: Absolutely true.
David: Is it the same way?
Adam: It is a little less true today because tech has grown in LA. But when we began, B2B marketing and software development were extremely difficult to find in LA. We found it was better to find the people with the right competencies and build their technical skills. We did this by only hiring people that were active learners. You describe this need throughout the world. Well, it is more true in a tech company. It is exponentially truer in a hyper-growth company where we have to find people who are capable of moving up from the baseline. Most tech companies don’t operate that way. In hyper growth, they regularly pull out the individuals that are not keeping up with the growth. The way we did it here, the reason we have had such stable and high retention is that we hired people that required the same characteristics of active learning and in interest in personal growth. We hire the ones who demonstrate they want to learn and are ambitious. As a result, they have grown with us.
Mary: I bet you had some casualties.
Adam: Very few. It could be said that we defy the odds because in so many organizations, only one or two will make it because they are exceptional. I am saying the opposite. Only one or two did not make it because everyone had the attributes. Our people make it because they are continuous learners when they arrive as well as in the parochial process, because these are the people that get promoted.
David: What would you suggest to your client companies that have significant challenges around employee engagement and change?
Adam: I’m in agreement with you. You have to start at the top. In a world where Millennials are expected to have four to six careers in their lifetime, it has to be a place to keep learning and developing. It can’t be a place where you were hired for a single job and expect to stay in that spot forever. There also has to be a major shift that happens in the corporate world, historically, where managers identify people they want on their team, you develop them and you keep them. In a world where people are expected to have multiple careers, you cannot have management push people into their box and keep them in that box. Early on, we identified that we were going to promote mobility and encourage mobility throughout the organization. At Cornerstone, that mobility is geographic where someone is not only able to move anywhere in the United States but [in] the world. It is divisional where someone can move from department to department within a division but also cross-divisional mobility where someone can move into an entirely different area of the company. We have had Millennials and Gen-Xs move throughout the entire organization in many different positions at times where in another organization they would have had to quit in order to grow.
David: You must have an incredibly transparent organization for that to work.
Adam: It took time because the managers were at first very resistant but again, we grow for the culture; we promote for culture and our people learn, especially our executives today, that mobility works for the organization as well as most of the people
in it. A few leave but more come.
Mary: Academia has an enormous problem in this area. These institutions attract some of the world’s best talent but they are resistant to sharing. The hoard their best so many of them…
Adam: Leave.
Mary: So many organizations could protect their best talent by providing them with options.
David: The reason so many people have difficulty with change is because they have significant deficits in what many organizations dismissively call “soft skills.” Here we frame these skills as the ability to draw healthy attention to one’s self and give healthy attention to others. We find it in the ability to build effective professional communities within and outside the organization.
Adam: The company can certainly enable these skills; they don’t have to wait for an employee to take the initiative. We view these as crucial management skills and expect them to help their employees to develop the skills of collaboration, mentorship, peer communication, connecting with other parts of the organization, and getting others to help them. Many managers have these skills but some require training. Periodically a manager has to be removed. We expect our managers to be good role models and mentors. I have a strong belief in the player/coach model.
David: We have been studying the role of mentorship in AA and believe organizations have a lot to learn from it as a success model. Here we have an entity that has no organization, no fees, no leaders, no real structure, and yet it has continued to grow and succeed for decades.
Adam: Well you are coming from a “pay it forward” mentality. Building relationships and continuously building our teams is a central part of our culture. Recently, a senior executive got married and I noticed in the wedding pictures that over half the guests were from our company. That is the norm.
David: In the years since you launched this company to today, what have been your most difficult lessons about talent?
For a moment, he went inward and we could see him scrolling through the years. Suddenly, a cloud came into his eyes. He was clearly pained.
Adam: We had one situation between two employees that went south...we had a very painful situation on our hands.
David: I learned a great deal about you in this moment. You are so disciplined and consistent in building values into your business and surroundings that you answered my question with a clearly painful employee relations event. Most CEOs would have so many or be so out of the loop that it wouldn’t cross their mind. One human capital nightmare comes along and it rocks your world because it is so out of sync with your values?
Adam: Yes.
David: What else did you learn that was difficult?
Adam: It is always a balancing act to satisfy the needs of the shareholders and the clients and the culture. Building relationships throughout the organization is such a big aspect of success. Once a year, we take everyone for a big party on the beach. Invariably I see people at their desk working and tell them, “Let’s get up and go.” They respond, “No, I have something that needs to get finished.” I come back with, “No, this is more important.” Maybe we push a deadline back one day and make it more important for people to get to know each other. That doesn’t happen in a lot of companies.”
Mary: It doesn’t. You dragged that employee away from something that he was conditioned to treat as more important than his own opportunity to bond and connect. I bet he came back full, energized, and deeply engaged.
Adam: It requires long-term thinking. You have organizations that tell a candidate, “We need for you to start right away.” But the candidate says, “Oh, I hoped to take some time off, get away, decompress.” We tell them, “Take whatever time you need. We will still be here.” We have the same point of view with flex time because you can shift time. Certain deadlines matter and others are not so critical.
David: What would you like us to know before we leave?
Adam: When we were a small company, we probably had about 40 people. Every year we would do something on our anniversary trip. We had no money. We asked everyone to write down a list of the perks they would want if we did have money. What order would you want them in? We set early on that even as we created shareholder value that we would be socially responsible. I believe the idea of the company itself is socially responsible. Regardless, we would build a foundation. In the last five years, our foundation has given over $125 million in impact. One of the things we did early on was to give to the shareholders, employees, and the community. We would be built on balance and we have delivered on that promise. As we became more and more successful, we added much to resources that we offer, as much as any top employer in the world.”
David: Do people give their time?
Adam: We do.
When someone in our company reaches seven years, we provide them with seven week sabbatical. We have a lot of people going on sabbatical. That gives a sense of how long people are with the company.
We have a competitive culture. So our people even compete in who has the “coolest sabbatical.”
As the interview finished, Deaira Irons helped us gather our belongings and walked us to the lobby. I turned to her and asked, “What do you think?” She smiled broadly, “It is all true. I have worked in some great organizations but the moment I came through that door, you could feel it. You could feel the energy, the kindness, and intelligence, all of it coursing through the halls. I am new, but this place feels like home.”
8
The Right Fit
“But I think that no matter how smart, people usually see what they’re already looking for, that’s all.”
—Veronica Roth, author of Divergent series
We have talked about all that we can do to build engagement after we hire talent. But, how can we do a better job of hiring already-engaged talent? Our candidates come from a market that is primarily fed two obtuse messages. They go something like the following:
• During economically good times, when there is more competition for great talent, we will treat candidates and employees better.
• During economically bad times, when talent is plentiful, we will treat candidates and employees like they are expendable.
When we examine much of the turmoil in our culture today, a great deal of it is centered around people feeling like they have been marginalized and certainly this is a reflection of some of our worst moments of organizational behavior. In the midst of this landscape, how many of us have sacrificed our standards to get or keep a job—any job? Let’s couple that scenario with all of the hiring managers who have never been trained on how to interview, select, and onboard highly effective talent. It helps to also recognize that candidates have been fed such negative messages during the last few years that it doesn’t take much to trigger bad feelings. Unfortunately, when we leave candidates feeling fear of survival in the hands of managers with inadequate hiring skills, all bets for the right fit vanish quickly.
Years ago, I asked a friend who was still in love with her husband after 40 years, “What is the single most important thing for me to know about having a wonderful relationship?” She looked me in the eyes, grabbed my hand, and ordered me simply, “Marry well.” Who we pick as our spouse represents one of the most important factors of whether or not we are going to be happy. In a similar fashion, whether or not we are going to be happy with our work depends on two critical factors:
1. The right fit.
2. Who will be my boss?
In the end, I believe that most anyone who wants a job and anyone who is looking to hire a new employee are looking for a good “marriage.” We want the partnership to be effective and also pleasurable. We want to grow from the experience. We want to look forward to working together. We want to be eventually grateful for the good decision we both made to enter the partnership.
A good boss can take what reads on paper as a mediocre job and spin that into a transformative career opportunity. On the other hand, a terrible boss can ruin the best job opportunity in the world. Time and time again
, I have witnessed how one bad employee can poison engagement and team productivity. However, that “bad” employee will often turn into a star when moved to an appropriate environment. Fit matters.
Right fit is an extremely critical aspect of engagement and overall productivity. So why does it get mucked up so routinely? Well, it usually begins with a CEO or business owner who doesn’t lead the culture. Why would an Engagement CEO stand idly by while hiring managers make anything less-than-right-fit hires? Why would someone allow candidates throughout the market to be treated with bad or sloppy manners? An Engagement CEO builds a culture that becomes a privilege to join and the invitation to join that culture’s tribe must be earned and celebrated. When this is done really well, everyone will be grateful and likely thrives in the environment.
Employers spend approximately $3,500 every time someone is hired, a figure incidentally that represents three times the amount typically spent annually on training and development. Little, if any, of these training funds are ever allocated toward creating better hiring managers. Developing managers who are savvy with interviews, who recognize their bias, and who are better able to make sound talent acquisition decisions, represents some of the greatest potential improvements we can bring to our organizations. It also supports fully engaged cultures.
Instead, hiring managers continue to sacrifice right fit to bias. Many of them define needed technical skills but fail to define necessary soft skills or “courage” skills and capacities such as personality types, morals, values and work ethic. Many never really think about the importance of manners, presentation, demeanor, demonstrated ability to change, resiliency, enthusiasm for innovation, thoughtfulness, and persistence. Therefore, they are making choices based on incomplete information. Still other hiring managers rely on even more seat-of-the-pants style thinking, such as, “I’ll know it when I see it.”
