Yearly Archives: 2007

I agree not to be an a-hole

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There’s been a ton of coverage relating to Bob Sutton’s new book – The No Asshole Rule, which I wrote about recently after Bob came to speak at our last company meeting.

From The Today Show to Guy Kawasaki, Bob’s book is burning up the airwaves and the Internet. Lucky for us, he thinks our company is cool. Why? Because we have a strong, stated no-asshole policy – and it’s something we take very seriously.

Guy Kawasaki actually posted what we call our Rules of Engagement in his blog post – and it unleashed a wave of comment. While some people like our "rules of engagement" a lot of the comments were very critical.

Here are a few of my favorite comments:

"I would question the viability of a company that feels the need for its employees to sign a "no assholes" agreement. In my experience, good companies build an environment where people don’t want to act like assholes – nobody needs to be bound by an agreement."

"Signing an irreverent-sounding no-ahole contract is IMO a bit like a town putting up a pithy "This is a drug free zone" sign with every local mucky-muck showing up to get their picture taken, then walking away."

"What a demeaning, patronizing, idiotic and stupid contract. How can anybody sign a contract that says shiitake like "I will have fun at work"? How can you even control that? Having fun at work comes from the workplace, not from the person working there."

"I am interested to know what the employees of "SuccessFactors" say about these rules when they are having a beer in the pub at night."

I think it would be silly to try to defend the rules of engagement in a well-worded and logical essay. I don’t think that would convince any naysayer and, to me,  the proof is in the pudding. So I went in search of proof. Proof that our Rules of Engagement has value to SuccessFactors employees - including and especially the No-Asshole provision. To find it,  I walked around our office in San Mateo and asked some colleagues if they wouldn’t mind telling the world what they think of our Rules of Engagement.

Here then, in their own words, is the value SuccessFactors employees find in our contractual "Rules of Engagement:"

Oh, and you can feel free to email them if you want, too -to find out more.

In this day and age, we should be more aware of how important our company values are, and by reinforcing these company values on paper, each person signing the agreement can feel a sense of accountability and ownership.  In short, signing a written agreement is much more significant than hearing someone drone about it in a lengthy 2 hour on-boarding snoozefest. The pen is mightier than the sword (or verbal agreement).
Christine Ng - Proposal Specialist

I remember my first interview at SF, and the “Rules of Engagement” were posted on the wall.  I read through them while I waited for my first interviewer, and then we ended up discussing them.  When you read “asshole” in a company document like that, it is certainly shocking at first, but eventually it put me at ease about the work culture.  A couple of weeks ago, the whole company got together and shouted “No Assholes” at the top of our lungs in front of our new headquarters.  It’s a crude, but direct expression of our goal to perform as a company but without the toxicity that is practically a given in other organizations.  It’s a worthy mission that others should adopt. But while the “no asshole” rule is important and certainly stands out, the other word I hear most often around the office with regards to the Rules of Engagement is “Kaizen.” 
Joe Cha - Product Management

"No Assholes is critical because as a frontline employee, it makes me comfortable that I can complain about a more senior person being a jerk. There’s no ambiguity about whether that kind of behavior is allowed for anyone."
Jake Adger - Marketing

 

Why do we need a contract (Rules of Engagement)?  It sets a clear expectation as to what we’re about. When you start here, read that document, sign it…. You’re thinking “yeah sure”.  But then you’re here for a week and you start to realize that everybody is living it.  It’s contagious.  It is not too good to be true.

Do we really live it? Absolutely.  Our people have integrity. We hire people with it and we’re allergic to people without it.  Complaining about a swear word in a blog is petty. Let’s focus on the content and what we can learn, instead of getting hung up on one word.

Measuring people is abusive? What happens when we don’t measure people? Heroes go unrecognized, unrewarded.  Misplaced talent goes unnoticed. Mediocrity ensues. Anyone that says this has never achieved much or is deluding themselves.  

Measuring people will make us “cogs”?  Automated Performance does sound a bit THX1138, but when you actually see it action, you realize that this is what will help put people in the right jobs at the right times, help people get rewarded what they should and breakdown the politics.
Cary Roll - Sales

"I saw the contract hanging in the conference room two minutes before my job interview with Lars, our CEO. The one I saw included a quote from Lars, "It’s okay to have an asshole, just don’t be one." And I felt like here is a place that values nice people… that don’t take themselves too seriously. At the end of the day though, you can have all the contracts in the world… and it won’t make any difference.  SuccessFactors happens to live and breathe these values and that’s what counts.
Alex Shevelenko - New Business Ops.

 

My own personal experience with no assholes is very simple. Once, my boss was being a jerk. I told him so – in those words. Instead of getting mad, he accepted the comment and we moved on. Later, he thanked me for telling him. My boss thanked me for calling him a jerk. Let me repeat that. My boss thanked me for calling him a jerk. Calling the behavior what it was helped everyone work better together and get more done. Can you do that at your company?

At Dell, No Performance = No Pay

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Some of the big business news this past week came out of Texas, where CEO Kevin Rollins left Dell Computer and founder Michael Dell returned. Back in the CEO slot, one of Dell’s first actions was to shoot this email out to his top staff.

Most notably were these few sentences: “Last year, we worked really hard and there were many sacrifices. Thanks! We had great efforts, but not great results. This is disappointing and it is unacceptable. The result is that there will be no bonus this year. I know this is a big deal for you and your teams. We’re going to fix that so that our efforts translate into great results and success for our teams. “

Pay for performance is a two-sided coin, and this decisive action by the founder makes it pretty clear that if the company doesn’t perform – no one is getting paid. It sends a pretty strong message of “we’re all in this together,” but he manages to say that with an optimistic, forward looking tone. 

But perhaps even more  interesting is what IS being done to reward people. Again, from the email:

“But we still have great people who made great efforts. It’s important to recognize your hard work, though our results fell short. Limited discretionary awards will be available to all but the most senior people. We can’t cover everyone, but it will be a tool you can use. And we are also budgeting for above-market raises this year.  For stock awards, we will shorten the vesting period from five to three years for future grants and move to restricted stock units. And we’re going to set the annual bonus plan against realistic targets. “

This strikes me as a very clever alignment of interests  between the company and its employees. Bonuses aren’t going to be widely distributed – but we can recognize special cases to continue to motivate those who have worked hard. We’re going to pay people more, so they understand that we think highly of them. We’re going to shorten vesting periods so that people will be able to see personal benefit from the results of their efforts and we’re going to make sure that bonuses are again available next year based on realistic performance targets for the company.

In any sort of turnaround situation, focusing on the people first seems like an excellent new beginning – and it looks like Michael Dell is doing just that.

HR Manager the 4th best job in America

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This was a tidbit I couldn’t ignore. According to Money Magazine and Salary.com, being an HR manager is the 4th best job in America – following only Software Engineer, College Professor and Financial Advisor. Job growth for the position is forecasted at 23.5% over the next 10 years and average pay is over $70,000.

To come up with the rankings, they started with a list of positions projected to grow at an above average rate over 10 years and require at least a bachelor’s degree. Then they eliminated some based on salary, total employment and annual job openings. The remaining positions were rated by “stress levels, flexibility in hours and working environment, creativity, and how easy it is to enter and advance in the field.” You can see all the details here.

President Bush wants pay for performance

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Not for himself, of course, but rather for America’s corporate executives. In New York City today, Bush spoke on Wall Street about his belief that “the salaries and bonuses of CEOs should be based on their success at improving their companies and bringing value to their shareholders.”

So often, pay for performance is a concept assumed to be applicable only to the rank and file. It’s a worthy cause to elevate it to the c-level as well and it’s great that Bush is pushing the idea.

It just makes you wonder what HIS salary would be if we applied pay for performance thinking to his $400k “guideline.” Given his approval ratings, it would be an interesting exercise indeed.

The No Asshole Rule

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A note: if the title offends you, please excuse me. I think the content and concepts make it worthwhile. Also, it’s the title of a real book – and so that makes it okay (right?).

I’m now kicking myself for being just completely remiss in not mentioning Bob Sutton on the blog. For one, he’s talked a lot about us recently, but mostly, I’ve been remiss because he’s an incredibly interesting guy.

He’s got a new book coming out next month called “The No Asshole Rule – Building a Civilized Workplace and Surviving One That Isn’t.” Today, at our all-hands company meeting, we got a chance to hear Bob speak on the topic.

The No Asshole Rule is something we actually have, use and abide by at SuccessFactors. We have a “rules of engagement” document which is posted all around our offices and on our website (#5) that reminds us of some of the basic tenets of working at the company. This particular rule, now softened a bit to “No Jerks,” understandably gets the most attention.

Why are assholes such a big deal? According to Bob, a professor of management and engineering at Stanford, they can easily take the wind from the sails of an otherwise successful company. Assholes can lower engagement, raise turnover and cost companies a lot of money. One guy Bob spoke about cost his company an estimated $160,000 over the course of a year – factoring in the costs of time spent by management, hr and executives in dealing with him – as well as anger management and training classes, overtime spent by other employees responding to his last minute requests and so on.

But its likely you don’t need any data points beyond ones from your own experience to make you aware of the preponderance and impact of assholes in the workplace. We’ve all dealt with them at some point and been the victim of behavior that makes us feel awful. According to Bob, there are two tests that identify the presence of an A-hole:

1. – “After talking to the alleged asshole, do their “targets” feel oppressed, humiliated, deenergized or belittled by the person?” and

2. – “Does the alleged asshole aim his or her venom at people who are less powerful or people who are more powerful.”

There are a few things to be careful of with your newfound A-hole identification powers. An important one is to be mindful of rushing to a-hole judgement – once you accuse someone of being one, you may quickly find you’ve created a monster.

So what do we do about the a-hole problem? Bob counsels us to simply avoid working at places where the a-hole factor is high (if you’re an employee), and to avoid hiring them (if you’re a company). He notes that “asshole poisoning is a contagious disease. Get out and stay out of asshole infested places – they will change you, you wont change them.” And the opposite effect is true as well – hire too many and it wont be long before your whole company is acting like an ass.

Another answer is to me mindful of “moment to moment conversations.” Be aware of asshole behavior – both yours and that of others. Noting and making small adjustments in response can make all the difference in whether a colleague perpetuates the -Ass-holishness.

We were lucky enough to get a copy of Bob’s new book today and I’ll be reading it soon. I hope to be back with further reflection once I work through it, but in the meantime, you should take a look at his blog for more thinking on the topic.

Findings from our Research on the Impact of Competencies in Financial Performance

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A guest post by Josh Bersin – CEO, Bersin & Associates

Competencies are one of the most difficult and under-utilized part of performance management.  Bersin & Associates research shows that only 36% of organizations with performance management process rate their use of competencies “excellent” or “good.”

But we also found that effective use of competencies can have a huge impact:  organizations that rate themselves world-class in the use of competencies for performance management are 4-times as likely to have a strong performance-driven culture.

Why?  Because the process of identifying and implementing critical competencies in itself drives a clear understanding of what performance means, how to obtain it, and how to communicate it.

As you can read in our recently published research, thoughtful and strategic use of competencies can have a significant impact on financial performance.  A few of the highlights from our research with SuccessFactors on how the use of competencies affects financial performance:

* Competencies should be customized for your business and should focus on management and leadership-level skills, not just job requirements

* There are two types of job-level competencies:  “hygiene” competencies which establish the basic requirements for a job (ie. customer service), and “performance” driven competencies, which, if executed, will not only help an individual perform their job but will help them grow and excel.

These “performance” or “critical” competencies vary from company to company and industry to industry.  

Read more from our research with SuccessFactors.

Want to succeed in High-Tech? Focus on your customers.

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A guest post by Erik Berggren – Director of Customer Results, SuccessFactors.

You probably don’t need me to tell you that successful companies are ones who provide products people want. But what sometimes gets lost is that this is true not just for B2C firms, but for B2B firms as well. To get a sense of what I mean, just consider the story of my current office printer. Made by a well known PC manufacturer – it is so universally despised by my colleagues for being constantly broken (as it is right now) that it will soon be replaced by a machine from another company. The moral of the story? If the end users, your ultimate customers, don’t like your product, its ultimately not going to do very well.

Recently, SuccessFactors conducted a study on how high-tech companies manage their talent. Specifically, we took a look at the core competencies such firms use to evaluate people in their organizations. Perhaps not surprisingly, we found that one very key competency stood out amongst companies that both grew faster and provided a greater return to their owners than their competition. That competency? Customer focus.

“So what?,” you might be thinking. Isn’t it fairly obvious that customer driven product development and engineering makes sense? Sure it is, but the research shows the importance of making this an explicit area for managing people. It’s not something that can be merely talked about, it has to be acted upon – and it’s that action that makes all the difference. By way of comparison, our research also showed that customer focus is NOT something that poor-performing high tech companies stress. That is what makes this so intriguing – we’ve proven both sides of the coin.

Want to know more? Based on the results from our broad-ranging research on competencies and how they drive financial performance, we decided to partner with Bersin and Associates to get a perspective of deep expertise from the broader HCM field. Josh Bersin has analyzed our research in depth and written a great report that puts the importance of managing competencies in perspective.

For questions about the research, feel free to leave a comment, or send an email to Erik at eberggren AT successfactors.com.

Want to succeed in High-Tech? Focus on your customers

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A guest post by Erik Berggren – Director of Customer Results, SuccessFactors.

You probably don’t need me to tell you that successful companies are ones who provide products people want. But what sometimes gets lost is that this is true not just for B2C firms, but for B2B firms as well. To get a sense of what I mean, just consider the story of my current office printer. Made by a well known PC manufacturer – it is so universally despised by my colleagues for being constantly broken (as it is right now) that it will soon be replaced by a machine from another company. The moral of the story? If the end users, your ultimate customers, don’t like your product, its ultimately not going to do very well.

Recently, SuccessFactors conducted a study on how high-tech companies manage their talent. Specifically, we took a look at the core competencies such firms use to evaluate people in their organizations. Perhaps not surprisingly, we found that one very key competency stood out amongst companies that both grew faster and provided a greater return to their owners than their competition. That competency? Customer focus.

“So what?,” you might be thinking. Isn’t it fairly obvious that customer driven product development and engineering makes sense? Sure it is, but the research shows the importance of making this an explicit area for managing people. It?s not something that can be merely talked about, it has to be acted upon ? and it?s that action that makes all the difference. By way of comparison, our research also showed that customer focus is NOT something that poor-performing high tech companies stress. That is what makes this so intriguing - we’ve proven both sides of the coin.

Want to know more? Based on the results from our broad-ranging research on competencies and how they drive financial performance, we decided to partner with Bersin and Associates to get a perspective of deep expertise from the broader HCM field. Josh Bersin has analyzed our research in depth and written a great report that puts the importance of managing competencies in perspective.

For questions about the research, feel free to leave a comment, or send an email to Erik at eberggren AT successfactors.com.

What’s so great about Fortune’s best companies to work for?

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Fortune magazine just came out with their annual list of the 100 best companies to work for. In the interactive presentation you can sort by components of the evaluation like “best” benefits, pay, growth in the number of jobs, turnover, % minorities and % women. These are all important things to consider when choosing a job, but I’m left wondering.

I’m left wondering why questions like “is this place a meritocracy?” or “does this company pay for performance?” or “what’s my chance of being promoted here?” or “how many jerk managers work at this place?” get lost.

While perks like free basketball games (Quicken Loans) or grocery delivery (Microsoft) or on-site laundry (Google) are great – studies have shown that they aren’t the most critical components of job satisfaction. So I’m left wondering – is this really a list of the best companies to work for?