1. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 1 Staffing and Leading a Growing Company

2. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 2 Leadership Process of influencing and inspiring others to work to achieve a common goal and then giving them the power and the freedom to achieve it. Process of influencing and inspiring others to work to achieve a common goal and then giving them the power and the freedom to achieve it. Entrepreneurs must take on many roles in their companies, but none is more important than that of leader. Entrepreneurs must take on many roles in their companies, but none is more important than that of leader. How do “leadership” and “management” differ? How do “leadership” and “management” differ?

3. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 3 Effective Leaders Create a set of values and beliefs for employees and passionately pursue them Create a set of values and beliefs for employees and passionately pursue them Respect and support their employees Respect and support their employees Set the example for their employees Set the example for their employees Focus employees’ efforts on challenging goals and keep them driving toward those goals Focus employees’ efforts on challenging goals and keep them driving toward those goals

4. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 4 Effective Leaders Provide the resources employees need to achieve their goals Provide the resources employees need to achieve their goals Communicate with their employees Communicate with their employees Value the diversity of their workers Value the diversity of their workers Celebrate their workers’ successes Celebrate their workers’ successes Value risk-taking Value risk-taking (Continued)

5. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 5 Effective Leaders Understand that leadership is multidimensional Understand that leadership is multidimensional Value new ideas from employees Value new ideas from employees Understand that success really is a team effort Understand that success really is a team effort Encourage creativity among their workers Encourage creativity among their workers (Continued)

6. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 6 Effective Leaders Maintain a sense of humor Maintain a sense of humor Behave with integrity at all times Behave with integrity at all times Keep their eyes on the horizon Keep their eyes on the horizon (Continued)

7. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 7 Four Vital Tasks of a Leader 1. Hire the right employees and constantly improve their skills 2. Build an organizational culture and structure that enable the company to reach its potential 3. Communicate the vision and the values of the company and create an environment of trust 4. Motivate workers to higher levels of performance

8. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 8 Conduct a job analysis and create practical job descriptions and job specifications Conduct a job analysis and create practical job descriptions and job specifications Hiring the Right Employees

9. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 9 Conducting a Job Analysis Create a job description - a written statement of the duties, responsibilities, reporting relationships, working conditions, and materials and equipment used in a job Create a job description - a written statement of the duties, responsibilities, reporting relationships, working conditions, and materials and equipment used in a job Create a job specification - written statement of the qualifications and characteristics needed for a job, stated in such terms as education, skills, and experience Create a job specification - written statement of the qualifications and characteristics needed for a job, stated in such terms as education, skills, and experience See sample job description from the Dictionary of Occupational Titles for a worm picker See sample job description from the Dictionary of Occupational Titles for a worm picker

10. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 10 Worm Picker Gathers worms to be used as fish bait; walks about grassy areas, such as gardens, parks, and golf courses and picks up earthworms (commonly called dew worms and nightcrawlers). Sprinkles chlorinated water on lawn to cause worms to come to the surface, and locates worms by use of lantern or flashlight. Counts worms, sorts them, and packs them into containers for shipment. (# 413.687 - 014 in D.O.T)

11. Table 19.1 Linking Tasks from a Job Description to the Traits Needed to Perform the Job. Job TaskTrait or Characteristic Generate and close new salesOutgoing, persuasive, friendly Make 15 “cold calls” per weekSelf-starter, determined, optimistic,independent, confident Analyze customers’ needs and recommend proper equipment Good listener, patient, empathetic Counsel customers about options and features needed Organized, polished speaker, “other” oriented Prepare and explain financing methodsHonest, mathematically oriented,” comfortable with numbers, understands basics of finance, computer literate Retain existing customersRelationship builder, customer-focused Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 11

12. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 12 Conduct a job analysis and create practical job descriptions and job specifications Conduct a job analysis and create practical job descriptions and job specifications Plan an effective interview Plan an effective interview Hiring the Right Employees

13. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 13 Planning an Effective Interview Develop a series of core questions and ask them of every job candidate Develop a series of core questions and ask them of every job candidate Ask open-ended questions rather than those calling for “yes or no” answers Ask open-ended questions rather than those calling for “yes or no” answers Create hypothetical situations candidates would encounter on the job and ask how they would handle them Create hypothetical situations candidates would encounter on the job and ask how they would handle them

14. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 14 Probe for specific examples in the candidate’s work history that demonstrate the necessary traits and characteristics Probe for specific examples in the candidate’s work history that demonstrate the necessary traits and characteristics Ask candidates to describe a recent success and a recent failure and how they dealt with them Ask candidates to describe a recent success and a recent failure and how they dealt with them Arrange a “non-interview” setting in which to observe the candidate Arrange a “non-interview” setting in which to observe the candidate (Continued) Planning an Effective Interview

15. Table 19.2 Interview Questions for Candidates for a Sales Representative Position Trait or CharacteristicQuestion Outgoing, persuasive, friendlyHow do you persuade reluctant prospects to buy? Can you give an example? Good listener, patient, empatheticWhat would you say to a fellow salesperson who was getting more than her share of rejections and was having difficulty getting appointments? Honest, mathematically oriented,” comfortable with numbers, understands basics of finance, computer literate How do you feel when someone questions the truth of what you say? Can you give an example of successfully overcoming this situation? Other questions: If you owned a company, why would you hire yourself? How do you acknowledge the contributions of others in your department? Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 15

16. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 16 Hiring the Right Employees Conduct a job analysis and create practical job descriptions and job specifications Conduct a job analysis and create practical job descriptions and job specifications Plan an effective interview Plan an effective interview Conduct the interview Conduct the interview

17. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 17 Conducting an Effective Interview Break the ice. Goal: to diffuse nervous tension Break the ice. Goal: to diffuse nervous tension Ask questions Ask questions  Remember the 25/75 Rule  Types of interviews Puzzle interview Puzzle interview Situational interview Situational interview Peer-to-peer interview Peer-to-peer interview  Keep it legal!

18. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 18 The “OUCH” Test Does the question Omit references to race, religion, color, sex, or national origin? Does the question Omit references to race, religion, color, sex, or national origin? Does the question Unfairly screen out a particular class of people? Does the question Unfairly screen out a particular class of people? Can you Consistently apply the question to every applicant? Can you Consistently apply the question to every applicant? Does the question Have job-relatedness and business necessity? Does the question Have job-relatedness and business necessity?

19. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 19 Conducting an Effective Interview Sell the candidate on the company. Best candidates will have other job offers. Your job: to convince the best candidates that your company is a great place to work Sell the candidate on the company. Best candidates will have other job offers. Your job: to convince the best candidates that your company is a great place to work

20. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 20 Conduct a job analysis and create practical job descriptions and job specifications Conduct a job analysis and create practical job descriptions and job specifications Plan an effective interview Plan an effective interview Conduct the interview Conduct the interview Check References Check References Hiring the Right Employees

21. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 21 Checking References Checking an applicant’s references is an important part of protecting a company against making a “bad hire” Is it really necessary? Yes!! Background Information Services: More than 50% of job seekers lie on their résumés

22. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 22 Conduct a job analysis and create practical job descriptions and job specifications Conduct a job analysis and create practical job descriptions and job specifications Plan an effective interview Plan an effective interview Conduct the interview Conduct the interview Check References Check References Conduct background checks Conduct background checks Conduct employment tests Conduct employment tests Hiring the Right Employees

23. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 23 Employment Tests Valid test – one that measures what it is intended to measure (e.g. aptitude for selling) Valid test – one that measures what it is intended to measure (e.g. aptitude for selling) Reliable test – one that measures consistently over time Reliable test – one that measures consistently over time

24. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 24 Company Culture Distinctive, unwritten, informal code of conduct that governs the behavior, attitudes, relationships, and style of an organization Distinctive, unwritten, informal code of conduct that governs the behavior, attitudes, relationships, and style of an organization “The way we do things around here” “The way we do things around here” In small companies, culture plays as important a part in gaining a competitive edge as strategy does In small companies, culture plays as important a part in gaining a competitive edge as strategy does

25. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 25 Characteristics of Positive Company Culture Respect for work and life balance Respect for work and life balance Sense of purpose Sense of purpose Diversity Diversity Integrity Integrity Participative management Participative management Learning environment Learning environment Sense of fun Sense of fun

26. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 26 Team-Based Management Self-directed work team – a group of workers from different functional areas of a company who work together as a unit largely without supervision, making decisions and performing tasks that once belonged only to managers Self-directed work team – a group of workers from different functional areas of a company who work together as a unit largely without supervision, making decisions and performing tasks that once belonged only to managers In this setting, the nature of managers’ work changes dramatically In this setting, the nature of managers’ work changes dramatically

27. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 27 Common Errors with Teams Assigning teams inappropriate tasks Assigning teams inappropriate tasks Failing to provide meaningful performance targets Failing to provide meaningful performance targets Sabotaging teams with underperformers Sabotaging teams with underperformers Failing to compensate team members equitably Failing to compensate team members equitably

28. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 28 What Makes Teams Succeed? Make sure that teams are appropriate for the company and the nature of the work Make sure that teams are appropriate for the company and the nature of the work Form teams around the natural work flow and give them specific tasks to accomplish Form teams around the natural work flow and give them specific tasks to accomplish Provide adequate support and training for team members and leaders Provide adequate support and training for team members and leaders

29. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 29 Involve team members in how their performances will be measured, what will be measured, and when it will be measured Involve team members in how their performances will be measured, what will be measured, and when it will be measured Make at least part of team members’ pay dependent on team performance Make at least part of team members’ pay dependent on team performance (Continued) What Makes Teams Succeed?

30. Stages of Team Development Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 30

31. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 31 Communication Managers spend about 80 percent of their time in some form of communication: Managers spend about 80 percent of their time in some form of communication:  30% talking  25% listening  15% reading  10% writing Many problems in the workplace arise because of poor communication Many problems in the workplace arise because of poor communication

32. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 32 Barriers to Communication Employees don’t feel free to say what they mean Employees don’t feel free to say what they mean Ambiguity Ambiguity Information overload Information overload Selective listening Selective listening Defense mechanisms Defense mechanisms Conflicting verbal and nonverbal signals Conflicting verbal and nonverbal signals

33. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 33 Communicating Effectively Clarify your message before communicating it Clarify your message before communicating it Use face-to-face communication whenever possible Use face-to-face communication whenever possible Be empathetic Be empathetic Match your message to your audience Match your message to your audience Be organized Be organized

34. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 34 Communicating Effectively Encourage feedback Encourage feedback Tell the truth Tell the truth Don’t be afraid to tell employees about the business, its performance, and the forces that affect it Don’t be afraid to tell employees about the business, its performance, and the forces that affect it

35. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 35 The Challenge of Motivating Workers Empowerment Empowerment Job design Job design Rewards and compensation Rewards and compensation Feedback Feedback

36. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 36 Empowerment Involves giving workers at every level of the organization the power, the freedom, and the responsibility to control their own work, to make decisions, and to take action to meet the company’s objectives Involves giving workers at every level of the organization the power, the freedom, and the responsibility to control their own work, to make decisions, and to take action to meet the company’s objectives Requires a different style of management from that of the traditional manager Requires a different style of management from that of the traditional manager Is built on sharing information, authority, and power Is built on sharing information, authority, and power

37. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 37 Empowerment Works Best When an Entrepreneur... Is confident enough to give workers all of the authority and responsibility they can handle Is confident enough to give workers all of the authority and responsibility they can handle Plays the role of coach and facilitator, not the role of meddlesome boss Plays the role of coach and facilitator, not the role of meddlesome boss Recognizes that empowered employees will make mistakes Recognizes that empowered employees will make mistakes Hires people who can blossom in an empowered environment Hires people who can blossom in an empowered environment

38. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 38 Trains workers to continuously upgrade their skills Trains workers to continuously upgrade their skills Trusts workers to do their jobs Trusts workers to do their jobs Listens to workers when they have ideas, solutions, or suggestions Listens to workers when they have ideas, solutions, or suggestions Recognizes workers’ contributions Recognizes workers’ contributions Shares information with workers, perhaps using open-book management Shares information with workers, perhaps using open-book management (Continued) Empowerment Works Best When an Entrepreneur...

39. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 39 Open-Book Management Employees: 1. See and learn to understand a company’s financial statements and its critical numbers 2. Learn that a significant part of their jobs is moving those critical numbers in the right direction 3. Have a direct stake in the company’s success through profit sharing, ESOPs, or performance-based bonuses

40. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 40 Job Design Strategies Job simplification - breaks work down into its simplest form and standardizes each task Job simplification - breaks work down into its simplest form and standardizes each task Job enlargement (horizontal job loading) - adds more tasks to a job to broaden its scope Job enlargement (horizontal job loading) - adds more tasks to a job to broaden its scope Job rotation - cross-trains workers so they can move from one job in a company to others, giving them a greater number and variety of tasks to perform. Often used with a skill-based pay system Job rotation - cross-trains workers so they can move from one job in a company to others, giving them a greater number and variety of tasks to perform. Often used with a skill-based pay system

41. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 41 Job Design Strategies Job enrichment (vertical job loading) - builds motivators into a job by increasing the planning, decision making, organizing and controlling functions (which traditionally were managerial tasks) Job enrichment (vertical job loading) - builds motivators into a job by increasing the planning, decision making, organizing and controlling functions (which traditionally were managerial tasks) Five core characteristics: Five core characteristics:  Skill variety  Task identity  Task significance  Autonomy  Feedback Enriched Job (Continued)

42. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 42 Flextime - an arrangement under which employees build their work schedules around a set of “core hours” - such as 11 a.m. to 2 p.m. - but have flexibility about when they start and stop work Flextime - an arrangement under which employees build their work schedules around a set of “core hours” - such as 11 a.m. to 2 p.m. - but have flexibility about when they start and stop work Job sharing - a work arrangement in which two or more people share a single full-time job Job sharing - a work arrangement in which two or more people share a single full-time job Job Design Strategies (Continued)

43. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 43 Flexplace - a work arrangement in which employees work at a place other than the traditional office, such as a satellite branch closer to their homes or, in some cases, at home Flexplace - a work arrangement in which employees work at a place other than the traditional office, such as a satellite branch closer to their homes or, in some cases, at home Telecommuting - an arrangement in which employees have employees working from their homes use modern communications equipment to hook up to their workplaces Telecommuting - an arrangement in which employees have employees working from their homes use modern communications equipment to hook up to their workplaces Job Design Strategies (Continued)

44. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 44

45. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 45 Rewards and Compensation The key to using rewards to motivate workers is tailoring them to the needs and characteristics of individual workers The key to using rewards to motivate workers is tailoring them to the needs and characteristics of individual workers Money is an effective motivator - up to a point Money is an effective motivator - up to a point  Pay-for-performance systems

46. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 46 Pay-for-Performance Employees’ incentive pay must be clearly and closely linked to their performances Employees’ incentive pay must be clearly and closely linked to their performances Employees must be able to see the connection between what they do every day on the job and the rewards they receive Employees must be able to see the connection between what they do every day on the job and the rewards they receive The system must be simple enough so that employees understand and trust it The system must be simple enough so that employees understand and trust it

47. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 47 Pay-for-Performance Employees must believe the system is fair Employees must believe the system is fair The system should be inclusive, rewarding all employees, no matter what their jobs might be The system should be inclusive, rewarding all employees, no matter what their jobs might be The system should make frequent payouts to employees The system should make frequent payouts to employees

48. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 48 Intangible rewards such as praise, recognition, celebrations, and others can be very powerful, yet inexpensive, motivators Intangible rewards such as praise, recognition, celebrations, and others can be very powerful, yet inexpensive, motivators Ideal for small companies Ideal for small companies Rewards and Compensation

49. The Feedback Loop Comparing Comparing Actual Performance Actual Performance Against Against Standards Standards Deciding What to Measure Deciding How to Measure Taking Taking Action Action to Improve Performance Comparing Comparing Actual ActualPerformance Against Against Standards Standards Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 49

50. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 50 Guidelines for Successful Performance Appraisals Link the employee’s performance to the job description Link the employee’s performance to the job description Establish meaningful, job-related, observable, measurable, and fair performance criteria Establish meaningful, job-related, observable, measurable, and fair performance criteria Prepare for the appraisal by outlining the key points you want to cover with the employee Prepare for the appraisal by outlining the key points you want to cover with the employee Invite the employee to provide an evaluation of his own job performance based on the criteria Invite the employee to provide an evaluation of his own job performance based on the criteria

51. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 51 Guidelines for Successful Performance Appraisals Be specific Be specific Keep a record of employees’ critical incidents - both positive and negative Keep a record of employees’ critical incidents - both positive and negative Discuss the employee’s strengths and weaknesses Discuss the employee’s strengths and weaknesses Incorporate employees’ goals into the appraisal Incorporate employees’ goals into the appraisal Keep the evaluation constructive Keep the evaluation constructive (Continued)

52. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 52 Praise good work Praise good work Focus on behaviors, actions, and results Focus on behaviors, actions, and results Avoid surprises (for both the employee or the business owner) Avoid surprises (for both the employee or the business owner) Plan for the future Plan for the future  Smart business owners spend about 20% of a performance appraisal discussing past performance and 80% developing goals, objectives, and a plan for improving performance in the future Guidelines for Successful Performance Appraisals (Continued)

53. Chapter 19 Staffing and Leading Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 53 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall