When CEOs Behave Badly

[Music] hello everyone welcome to the 21 hats podcast I'm your host Lauren Feldman this week our conversation starts with Shawn busy and Jay goz trying to understand why CEOs keep going viral for their misguided attempts to rally the troops Sean suspects CEO screeds have always existed they just haven't been recorded he also thinks they tend to come more from public company CEOs who are beholden to shareholders Jay on the other hand thinks they're just morons I really don't understand how someone could be smart enough to run a big company like that he says and be so completely ignorant it's shocking to me of course CEOs of both publicly owned companies and privately owned companies do have to do unpleasant things sometimes but Sean and Jay say they've learned from their own experiences handling layoffs and recessions do we have to go out of our way to be callous about it JS I don't think so plus the very different ways Shawn and Jay manage their hiring processes oh and what would happen if J applied for a job at Sha's company even in Good Times owning and running a business can be a lonely Pursuit our hope is that these weekly conversations brought to you by our principal sponsor the great game of business will let owners know they are not alone in facing challenges same thing with our daily newsletter the 21 hats Morning Report which ni magazine named the best newsletter for business owners and which you can subscribe to for free at 21h hat.com where you can also find transcripts of our podcast episodes and lots of other articles and interviews joining me this week on the podcast are regulars Sean busy CEO of Kinesis which is based in Portland Oregon and works with small businesses on marketing culture and strategy NJ goz CEO of the gos group whose companies in Chicago include a picture frame business artist frame service and a home furnishing store Jason home the episode is titled when CEOs behave badly [Music] welcome Sean and Jay it's great to have you here I want to start today we seem to have had a Spate lately of CEOs going viral for the wrong reasons uh for talking to their employees in a way that can seem I don't know a little toned deatha in one the CEO told her employees to stop whining about not getting a bonus and to get to work you can visit pity cities she said but you can't live there and another CEO complimented one of his employees for selling the family dog so he could return to the office office you also challenged the idea that you can be the primary caregiver for a child while also working full-time I don't know my uh my CEO friends what what are we to make of this you know what you use the word ton def I think that's a little weak just morons okay no I've said stuff that I was T i' certainly we all at times maybe have said stuff that's tone dep this is so huge there CEOs a big and that one of them makes 4.9 million and doesn't think about the fact they make 4.9 million a year and they're talking to people like I don't think that falls under the category of tonee not just talking to people telling people not to complain about not getting a bonus yeah so I think that's a little soft sell calling that tone def I think that's just I I wanted to start you did it was a good warmup you put it right right in the middle of the plate for me and I'm hitting it all I just like wow seriously my guess I'm no expert in this I've never looked into it I'm guessing this if you looked into the background of all these people they've never been at the bottom anywhere that's my guess they went to the right schools and they made a lot you know they got they just have never they just can't identify with like regular people that's my guess and I could be wrong but I don't know how you could grow up or especially in my case start a business where I hit a bunch of people not making much you know I wasn't making much more than they were in the beginning and not empathize and understand versus you're making $4.9 million Sean how did these hit you I I mean I have a couple thoughts on this one is that I suspect these types of conversations have been happening for a long time it's just that now with the prevalence of zoom and remote meetings and the ability to record things just like with social media like we're just seeing people for who they truly are in some cases and so I just you know it's like used to be able to get away with it I think and now it's I think harder and then the other thing speaking specifically to the pity City CEO or the pitiful CEO if you watch her she starts out pretty calm and collected and then there's just a moment you just see her amigdala just hijacks her like she just goes into this totally different space and then when she finishes it she's just sort of like raises her hand like she did a great thing and I think she thinks she was motivating and rallying the troops yeah like mic drop mic drop yeah right the mic drop moment and I and I just I think look if I can be empathetic for a minute you know she's running a company that does commercial office Furnishings which is probably one of the worst businesses you could be in in the last few years and so I'm guessing she's getting all this pressure from you know the market and from her board to perform and she's just pushing that down onto her people but she still got a Bonus though did you notice that she still got the huge bonus so I'm trying to be empathetic to her but I'm having a hard time understanding like I said you know maybe we've all said things that were maybe it's just me I'm sure I've said things that have been toned de but this is so beyond that I just say to myself how could you be that ignorant to not at least as a leader to say listen I Know It's upsetting that you're not getting your bonuses it's like how dare you ask and uh it's really remarkable I don't know and I'm sure to Sean's point this has been going on for years this isn't a new thing and I think two things can be true at once one is I think leaders are under a lot of stress and have been under a lot of stress across all Industries and also I think she's a terrible leader I think they're both true I think they're both true I mean that's just everything about that the lack of empathy the size of compensation she gets in relationship to the other people you know pushing down on people motivating through fear and threats I mean it is a textbook in terrible leadership honestly I don't think she'll survive this I think she's out I might be wrong but I I just don't know how the company goes forward with that kind of behavior I mean it's they've got to do something my daughter-in-law is a labor attorney and she just went off on her own and she's doing a seminar today and she's speaking about you know the intelligent way to do layoffs in the last two weeks there's been some horrendous examples of it you know and I said to her you know what you're really doing three things first as a lawyer you have to explain the legal things about okay fair enough then you got to think about brand like your company's going to be known for this how do you look if you go and lay off a bunch of people and are cold about it and don't do it in the proper way then you need to think about if you're going to be calling people back this is the true statement I'm going to tell you I've done speeches to hundreds of people I have never met one when I say do you know how unemployment works in your state no one really understands it that I've talked to I'm sure there're somewhere but no one's they've guessed at it and I go no that's not how it works the reality is in Illinois going to cost you if some some's making more than like 50 Grand it's probably going to cost like $27,000 of unemployment you don't get a bill from Illinois it throws into your rate and it's slowly it comes out of your thing for the next three years but most entrepreneur don't know what their unemployment rate is so it's expensive to laying a lot of people off so the point is if you're thinking you might have to bring them back in four or five months you know what you just paid $27,000 out and now you're gonna bring them back so you should consider that maybe there's furlows maybe there's other things you do and then lastly it gets to another level of do you want to be a decent human being I mean this is disturbing to people I how forget about the brand forget about the money how about try to be a decent human being and recognize people are traumatized by that sometimes and try to be nice how about that there are some interesting issues in that Jay and things have changed because of the pandemic and zoom wasn't it McDonald's recently that told people not to come into the office so they could be laid off on Zoom they wanted everybody to be at home and and that was an interesting qu some people took the side that that is the Humane way to do let people be at home and not in the office uh that's funny you say that my nephew just took a job there a pretty decent job there and he I he told me he wasn't sure if he was getting laid off or not and I understand that running a corporation with tens of thousands of people is different than running it with you know 50 or 100 but there probably is an argument as to what's the most humane way to do it what are you supposed to have a meeting with aund you know with 10,000 people I I'm not at all saying that oh no it's got to be oneon-one in person maybe it can't be I I understand that but there's still ways of doing it that are decent and Humane as much as you can be I mean some people are just going to be upset I got it but do we have to go out of our way to be callous about it I don't think so Jay I'm curious in your career have you had to lay people off for like financial reasons listen I've lived through what five recessions six recessions in 45 years um I probably a couple of times like the bad one 2008 I cut everybody back to 32 hours we were doing fur we were do and I didn't lay anyone off if there was someone who was marginal or who was just barely holding on or we just hire yeah sure I would I would lay them off because it's it's it but but I've never had she did slay some people off very minimally though very minimally and all these years maybe three PE I I don't remember it was there was never I've never laid off like five people or something and and if somebody was barely holding on to the job it's like at that point it's not fair to the ones that have been there for years that you know you have to balance out you know fur ain't great either and cutting hours isn't great either so there is a reality to do you can only cut people's salaries so much to where they can't put food in the table so can you cut people from 40 hours to 36 yeah probably but you can't cut them to 25 now people do that but it's just a mess and I'm not doing that and and i' you know I've read this once somebody once said any company that lays off people is an indictment of management I think that's a ridiculous statement I it happens it happens I I'm sure sometimes it's done in an irresponsible way for sure but the pandemic the all the high- tech companies are doing so well they hired a bunch of people oops I mean who knew it was going to drop off I mean layoffs happen not here so much but other places how about you Sean have you had to do it yeah you know I've let's see how many how many recessions have I survived so I started in 2000 that was a recession we had 911 that was kind of a mini recession 2008 and then the pandemic which behaved differently than a recession but kind I had similarities so 34 it 2008 wiped me out like totally wiped me out um and it didn't hit me until late in 2009 and you know I was at a point in my career where I honestly was still trying to figure out how to run a business I didn't have a good business model that that was really important learning for me and you know we just got wiped out you know all our customers stopped buying kind of all at the same time and so we had to pretty much lay everybody off including myself you know if there had been if there had been any jobs in the market I probably would have taken it and just got become an employee at least for a little while but uh yeah that was rough that was really emotionally very hard how long that go on you know that's the funny part about it as I look back at it recently you know because it felt like forever you know it felt like wow we were really suffering for a long time and the truth was the momentum was building probably within 8 n months of that of that low point and then within a year we were like rocking and rolling again wow I mean the reality is you got to keep the business in business and the worst recessions I like I said I've been through I don't know six seven did my business everage drop off 20% yeah oh wait it did um but by cutting back the salaries and doing some Furlow and you know we squeak through it's difficult but I see some of the with the last two of you mention doing these things and I just I really don't understand how someone could be smart enough to run a big company like that and be so completely ignorant it's it's shocking to me so you have a superpower or secret weapon that these publicly traded companies don't have which is you are beholden to yourself and your employees they are beholden to Wall Street and shareholders yeah yeah and so once profits fall below a certain level like they have no choice but to like eviscerate the company and you can choose to take less compensation you can choose to reduce wages you can ask people to sacrifice it's just like I mean that's why I'm so passionate about you know owner run businesses is because they can actually be human I don't think that Miller n CEO has any choice to some degree except to like do crappy things you know being a crappy person and forced to do crappy things is a pretty bad combination yeah you know what you bring up a fair point I don't know what it's like to have to answer to shareholders and stuff and and and and I call it you know selling your soul I like to keep my soul so that's why I run my own business I can do what I want but you're you're right I I'm not even criticizing them I just say I don't understand it and I think it's but but but that's kind of that now that I'm thinking about it though okay maybe they had to lay people off no problem they don't be jerks about it though and start saying stop being a Pity part geez I mean really that didn't save any M that didn't help the shareholders already I mean what's that about that was just like a a a flagrant foul for no reason Sean when when you had to lay people off did you feel like you handled it as well as you could or did you learn from the experience how do you look back on that I was uh really kind of baby business owner at the time and we were very small so you know maybe like there were like four or five of us total and you know I'd never had to do that kind of thing before and I had never had any guidance on it I didn't have any mentors so it was not a very it was just really emotional I felt like a complete failure just to be completely candid you know I was like breaking down in front of my employees just I just felt like such a loser and you know with the benefit of time you know I've become a lot more easy on myself but in the moment yeah yeah I felt like I was just such a disappointment taught me some good lessons you know I had a really interesting meeting in 2008 when it really got bad I I sat there with I believe four other people and I said look we'll cut the salaries by x amount and then the hourly but I got to tell you if we cut the hourly any more than this they're going to have a hard time putting food on the table and one of the people around the table who was young at the time said either I don't remember which was it was either that's not my problem or I don't care and it kind of sucked the air out of the room and that person's still here and is doing a very good job and I wrote that off to being young or whatever but like I got to tell you I still remember it 15 years later because it was just like wow yeah so actually Lauren what changed you know I'd say like in the early pandemic I was convinced we were going to go into like an economic Ice Age I I I saw no you know path forward that was going to be positive for us or a lot of businesses because you got to remember this was before PPP this was before vaccines y uh and so I was looking at the landscape and I was like holy crap this is going to make 2008 look like a freaking walk in the park and so what we did which was so different than 2008 is we went into like action mode right away and we put together our plan and we you know the plan was all about getting really close to customers being empathetic with customers supporting them we offered many customers like hey you don't have to pay us if you don't have the money like we literally we'll keep working for you if you can't pay us it's okay we want to help you and the Goodwill that that bought was amazing and the other thing we did is we built a huge spreadsheet that showed okay phase one is senior leadership because now we're bigger right we're a little bigger than we weren't a lot bigger than we were in 2008 so we could like take the hits right we had cash reserves we were making good wages like unlike we were in 2008 so I was like okay phase one senior leadership takes a pay cut of this much phase two senior leadership takes another pay cut phase three middle folks take this pay cut phase four the lower paid people take a small so it was it was really this tiered program and we shared it with the whole team like we were totally transparent about it this is what we're going to do and our goal here is to extend the runway in hopes that something good happens and as it turned out a lot of good things happen you know in terms of the government not treating it like they did in 2008 which was to just basically let everybody to twist in the wind um so you know the combination of PPP gave customers confidence to keep going the the Goodwill we had built the Better Business model we had built all those things in combination made it so that we actually didn't suffer at all and then it by the end of 2020 we had our best year on record best year records profits record revenues wow and and I really think that those first months made a huge difference because it demonstrated to the team that we as the you know the leaders we were willing to sacrifice long before we asked them to sacrifice and I think that's why we had such good retention throughout the pandemic while everybody else was having tons of turnover whereas if you contrast it with other companies as soon as things got rough what did they do they laid their people off and then then they F then they realized oh [ __ ] we need those people to today's point we need those people back and then they tried to hire them back and they were like [ __ ] you you know and then they couldn't find people so I think that there's a big difference in how you treat adversity um whether you do like our pity City CEO did or you actually work together so that was my lesson I mean the fact is the first thing you should do is not kneejerk yeah I mean it's not the second you fire them it's not like like I said you're just paying an annuity you're going to pay it in unemployment for the next three years so it's not you should think about maybe it's worth carrying it for a little bit because it is gonna it's not free to fire to lay people off you know it's not just unemployment I mean a lot of companies pay Severance as well right and recruiting fees right so then when they need people back they pay recruiters all this money to go get new it's so expensive it's crazy it's spending a lot of money to do damage to your brand right the more I'm thinking about it you're right Sean we don't know what they have to deal with this okay that's clearly part of it they have to deal with stockholders but I really think the other strong part of it is they just they didn't work their way up from the mail room they just didn't most of them they went to Stanford or something and they got recruited and they got put into these they really don't empath and I think about with the way they're talking to these people about get over the pity this is what they say to the himself I mean you know they're very successful they probably have a strong work ethic and they've got you know persistence and that's how they want someone to talk to them and they go yeah you're right they're not talking to themselves they're talking to someone who's making you know $43,000 a year and is trying to make their car payment they just can't identify with the the what what the real world is about it seems to me and that is not what the typical small business owner is at all MH yeah it's a really different Universe when we wrote the book talking about you know how to do Marketing in a in a own orun business a lot of it is contrasting Corporate America and what we what's called shareholder Primacy which is where the shareholders are the customer they're the primary customer meaning in a public company it's the stock market and and in a privately held business you can pay attention to lots of different constituents including your employees including your community including the environment you know on and on and on and on so I think it's just a systemic problem that it's really hard to get around I I don't really know what the answer is to it but I know I don't want to be part of it you know the second company that we referred to is clearlink a digital marketing firm that's the the CEO who complimented his employee for selling his dog I don't think that's a public company I'm not sure probably got private Equity though probably that would be interesting to see I mean you can be a jerk and be a privately held company that's kind of my point yeah I have definitely seen those but then then it's more about what is the characteristic of the leader because you can really see it in in full display um versus some of these folks where you know I've known companies that were wonderful and then they became owned by private equity and they became not wonderful anymore I've seen that frankly almost every time and I'm being generous so I say almost I can't think of one that I've dealt with that didn't go the way that went I mean it's very pain P ful to watch a good company with a caring owner the owner sells it and then all of a sudden the cut start and the oh we don't do that anymore or and the rules and the and the policies and next thing you know you're the whole business is just a shadow of what it used to be you know a lot of this starts with hiring if you do a good job of hiring and hire people who you're happy to have as employees I think you're going to look at these situations differently and try harder to to to handle them better so it gets back to the question of you know how you hire people and and I'm curious do you guys have a routine when you're involved in hiring at your companies I I'm sure not the front line but if you're doing an interview with an important job candidate do you prepare for that in any way what do you do before you talk to them what are you thinking about I don't really get involved with it anymore even at the end sometimes but not a lot I I'd say 90% I don't even I can't think of the last time I was brought in for I brought you know hired a CFO I was involved but I the last no I'm not brought in at the end okay and I feel really good that I've got people that understand our DNA and know what we're looking for and they're better at it than I for sure and I don't say this it's true they're better at it than I am I'm a sucker for the hard luck story of someone that's trying to pull thems up and I I I that's my sucker pitch and then I hire and it doesn't work out sometimes and I've said to numerous people the entrepreneur is frequently the worst person would do in the hiring because they're totally into their company so they talk about it too much and they like people liking people too much is hard when you're interviewing you got to like take that off the table for the moment say guilty and so proven innocent and then lastly they literally have 21 other things to do maybe 20 because there's 21 hits they've got 20 other things to be doing so they hurry through it and that's a recipe for disaster I've talked about this before when I hired a woman to do my hiring my business changed my business business has changed to this day the people she hired for me 18 years ago are still here she was way way way better than I am at it and I believe the first step is to figure out who should be doing the interviewing how much do you get involved Sean yeah I've had a real journey with this in our period of really fast growth um so say 2011 to 17 especially I was in it hard like I really believe that at our size you know and for context for anybody who's listening like we're about you know a 13 14 person company at that point and I just believe you can't afford to get it wrong at that size like you know you think about you have a mish hire at 10 people that's 10% of your Workforce is it's not a good thing so I was the Frontline in that case you know I would meet people in informally take them out to Coffee I would do a deep dive interview with them you know I really took control of that process and it yielded good results for me so you think well that's the question so you think you're good at it I'm good at it okay good yeah yeah it's I mean like my superpower is EQ like I I can read people real fast wow good to know you know it's good for clients too like you know cuz you can like sense it you know o this one this one's going to be tough you know kind of thing or we shouldn't take them every superpower has a shadow side so the shadow side is that when I miss like I've missed in a big way once or twice and I have learned that I got to be really careful how do you explain that why why do you think you miss in a big way when you miss I had an employee once who I think they're the the archetype for them is What's called the political actor which is that they're really good at building alliances within an organization and using their political power to to climb a ladder but it's a very manipulative way of working and so they also have probably a very strong EQ but they're kind of using it for bad purposes so I have to be really cautious of that person so you're hiring batting averages what 90% 80% yeah if I were to look at that over time the ones that I hired yeah it's probably 80 90% and mine in the beginning was probably 25% cuz I was just hiring whoever seemed nice and didn't understand the process and when I do get involved now I think I'm probably at 75% but there's people that are better than me at it so it takes a long time you really have to make a lot of bad hires before you finally realize that this is trickier than it looks and pay more attention I'd advocate for a process too that's one of the things that I wanted to get it past just like use Sean's gut and we started putting in place a really lengthy process that you know in today's market might be too lengthy but it really produced good results for us and the key to that the real the real win on that one was the last step where we would pay people to do kind of a sample presentation and so we could actually see how they worked and how they interacted with groups of people and that was a big deal like that that change really helped weed out some of the like folks who seemed pretty good and but we weren't really sure and they'd either like rise to the next level or they would Plum it that was a big change for us it really helped and we still do that today and when we didn't do that we hired some bad hires and how long does it take you to figure out one the one you hired that you shouldn't have does this go on for three months a year three years yeah that's a great question and something I've been thinking about a lot is that pre pandemic I think we knew the truth about the person within 3 months and then we accepted it within in the pandemic I those numbers doubled so it was like at 6 months we're like uh I'm not sure cuz we're working virtually right and it took us almost a year before we're like [ __ ] we got to move on with this person I think there's two things one is we get better at hiring in the second one did you get better at firing like seeing it earlier on yes I had one I couldn't make this up as so Preposterous I hired a guy probably 30 years ago to be a sale outside sales guy we go to lunch we come out and there's a ticket up from the parking meter didn't put enough money and he says oh this is what I do I take the ticket off my car and I put it on the car behind me and I flip tickets sometimes they pay it by accident wow so I go back to work if that happened now I would smile and say that's okay we won't do that I'd come back to work and I'd fire him and say we're done back then I don't know I kept him for a few more weeks or something like anybody that would do something like that like you don't need them in your business so there's lots of times I can think of lots of times where I should have known better and done something about it and I let it slide too long and it's it's always too long I mean Jay you've done something that is really really really hard which is you've turned your company into a hiring engine that doesn't rely on you and and I think a lot of owners struggle with that I think that's really hard yeah I guess I and and just maybe because you were so bad at it to begin with no part no because I'm the opposite of many entrepreneurs they're they're control freaks I'm the opposite I don't want to do the day-to-day stuff I want to go off and do my thing look at I'm on the podcast now it's symptomatic of I like to do what I like to do I don't want to go through reports every day I'm I'm I'm 80% entrepreneur and 20% manager now I said that to my production guy that's been with you for 25 go no no Jay you're 100% entrepr okay z% manager but but I I really don't want to do it and I and the key is keep in mind the people that I've got doing the interviewing they've been with me for 15 20 years this isn't like I hired someone three years later doing all the hiring so they know it they know it better than I do in some cases plus they've got another Advantage they're not talking to the boss then they're talking like a co- they're going to give a different view to them they're going to give to me let me ask you a question so did did these people who are good at it now did they go through a season where they kind of sucked and struggled or have they always been good at it no I'm just thinking in my head I don't think there was a big learning curve they were here for years they know what we're about they I no I think they were pretty were just good at it and like I said I know what my weaknesses are I love the pulling themsel up by the bootstraps and I I'm a sucker for giving people opportunities and the fact is it works a lot but sometimes it doesn't work that finding the diamond in the rof sometimes it's not a diamond and it's just rough the big Lun of coal yeah that's how it works but but I've got 20 stories of people to tell you that I found the diamond in the roof that like they great there's 20 of them but then there's the other 10 that oops Sean have you do you have a an approach that you could articulate to what you want to hear what you want to ask with a candidate yeah I mean I I even have a post on it on LinkedIn I'm like the three favorite questions I like to ask in an interview so like if somebody you know wants to work here you know even just if they've read that it gives them a leg up but really what I'm looking for is I'm looking for a history of commitments you know and and actually I do have some overlap with Jay here I like to see somebody who's actually demonstrated they've worked on something and they've struggled and they've failed and they've they've tried something I mean I one day I discovered that a ton of our employes were children of entrepreneurs and and I realized I was probably filtering in for some of this like which is comfortable with risk comfortable with uncertainty knows what it's like to struggle and we're not talking children of entrepreneurs of business where they were just rich and lived that privilege you know so so I'm I look for stories of work effort struggle uh Triumph and failure how do you get at that what are those three questions I mean you know one of them as an example is the you've won the lottery question so you've won the lottery you just got $500 million after tax what are you going to do with it and so I like that question because it's first of all it's like Open Sky question what what are you going to do and it's really interesting because it really shows me very quickly what the values are of the person so I've heard everything from well you know the first thing I think I do I would pay off my parents house and and and that's really interesting because it tells me that they're they're thinking about how do I establish Safety and Security for people I love before Oh my God I would go to Hawaii and I would do this and I would travel the world right I Look to like do they put others before themselves do they think about something bigger than themselves so I've had people say you know I would start a foundation for decarbonization and blah blah blah blah blah blah blah blah blah blah and like wow you have a passion other than just this job which I like I want you to have something you care about other than just the job or telling me that you want just the job and then on the flip side you know I've heard stories like oh man well I quit my job and then I would uh go do this live in New Zealand and I would live you know in this really big house you know very kind of self-centered and you know like we all have dreams we all have things we want to spend money on but it it it it's really evident very quickly do they view the world through the lens of themselves and what they care about all the time or do they view the world through a larger lens and that's been a great kind of mechanism to see what people care about that was a West Coast thing done nicely the whole self thing got it okay I'll give you the Chicago version now I want four things b a b do they buy into the concept I want to ask them so tell me what did you do your last job tell me a difficult situation you have with a customer how did you deal with it and you can tell that one's very revealing well listen sometimes customers can be difficult versus oh customers are jerks and blah blah blah I so I want I want honest answers so that usually gets me something good a is able can they do this job did they do it at their last job and ask you know try to find out what they were doing here's a big one team player which I have a very specific definitions to that I want someone to be honest just tell me what's on your mind I always say to them listen I'm giving you Authority ask me anything you want about this company you'd like I ask me a question that when you go home and you tell your friend they're going to go oh my god did you really ask him that how does that indicate whether they're a team player or not Jay because you can tell if they're comfortable having an honest conversation with you which a lot of people aren't like and this is the one that brings it up so tell me why you're looking for a job well it's just time and then I say that sounds like a lot of [ __ ] what does that mean it's just time I mean did you get fired do you I I just I want to hear why you want to leave your last job tell me what's what what is it about your job that you want to leave and I want an honest answer and I tell them that perhaps you've read articles or talk to people to say don't say anything I'm telling you that's not how I operate I really want to understand why you want to leave your job do you have a bad boss are they not paying you and you can people will usually let their guard down and tell you the truth and I find that to be a tremendous indicator as to what am I getting myself into because whatever they're saying about their last boss could be true about you or maybe they've got a legitimate reason for leaving and and then the last one is I need people that are a little hungry that like need to work instead of just to want to get out of the house and I'm not the kind of place where they're working 60 hours a week but I need them that they want to work their 40 hours and I've gotten like I said I've gotten way way better at it than I used to be because uh and then another piece that from what I've learned talking to lots of entrepreneurs the reference check can't emphasize it enough yeah I totally agree with that asking for it you don't check references no Sean I think you'll agree with this nine out of ten times kind of a waste of time they tell you good stuff they work out that one out of ten oh my God this person must not have a lawyer they just told me oh that guy he's a drug dealer I mean I people say stuff I think to myself have you never been told by a lawyer you shouldn't say stuff like but they do because I've learned people do not want to lie for people on a reference check they just don't want to do it it's true and they speak encoded language too because if they know the law they know they need to tread very carefully but it if the person is a great employee they will go out of their way to tell you that over and over again absolutely that's the point so I call Costco this woman was going to work in my flower department and I I called the guy I asked about her and I forgot what he said but he says I don't want to elaborate and I thought oh great she comes in I swear this is the truth she comes in for another interview and I said you know I have to tell you I called your reference it was a little troubling he said he didn't want to elaborate and she blurts out yeah I'm difficult to work with so you know looking for honest great when can you start I think you know something that's really important in what Jay just said and and I've been thinking about this too is like you talk about asking experiential questions you know tell me about the time you did this I think that's really critical and I also think it's really critical that you're evaluating can they do the work right do they have the skill set and so my my lottery question is also a lot like my sports team question I ask people pick a sport you're familiar with it's a team sport you can be any position you want what position would you play and that tells me a lot about how they think about themselves how they see teams so these are like totally different paths you know whereas I have other team members focus on can they do the skills can they do think I'm looking for like Persona and values and and that's both of those are really important things okay so if you were interviewing me and you asked me that I would say to myself oh please stop well yeah Jay you'd make a terrible employee which is why I'm not I quit that's right quit you can't fire me I quit yeah I'd fire you I wouldn't hire you in the first place so it doesn't I'm glad we're on the same page with that that's great no I mean it's you know just even your response to that right it's like you know that's why you're an entrepreneur right no I'm sure that's true I just don't want to do Sports analogies no I'm sure you're right I I've taken back my resume that's okay you know we don't have any openings for you I want to ask you both one more question which is this has you're thinking about making a counter offer to an employee who's gotten an offer somewhere else changed it all I think people traditionally have not liked to pay people to stay in their jobs but I'm wondering if that to survive the pandemic I haven't had one example of that I'm telling you I haven't lost I went through a few people but it was mostly my choice I no one's come up to me I I haven't had someone quit that's taking more money somewhere and I don't think in 45 years I've ever done that I've never been asked and I wouldn't do it cuz fundamentally you know if somebody's unhappy with their compensation here I would want them to talk to me about it I could look at myself and say have I created the environment where they're comfortable talking about it but you know that that whole thing of somebody's taken a job or an offer and then they come to you with that offer man that is just a freaking landmine I mean they're going to leave you eventually yeah I think statistics have shown that but I have to say this is just my own little experience I would I don't I have not had a lot of people quitting for more money and I think if you pay people properly and appropriately they shouldn't be leaving for money all the time unless if you're in the computer business I'm sure that you couldn't control that but like in a normal old time business like mine I I have not lost a lot of people over the years for that yeah I think if you're in the market if you're reasonably in Market if somebody's coming to you with a competing offer you got bigger problems there then you know if they come to you with a competing offer and you're you're you really are underpaying them in the market then maybe it's worth examining that issue all right I'd love to keep talking to you guys but I've got an appointment to sell my dog um and I have to run consider renting the dog instead are you anui you can travel to pity City but you can't live there okay my thanks to Sean busy and Jay GS and of course to our sponsor the great game of business which helps businesses use an open book management system to build healthier companies you can learn more at Great game.com thanks guys wait wait don't leave yet if you have a question or a comment that you'd like the 21 hats owners to address send it to me by replying to your morning report or by email at Lauren 21h hats.com that's L ren21 hats.com do it now before you forget and don't be afraid to tell Jay what you really think you can take it and if you got something out of this conversation help us reach more business owners tell a friend subscribe and review us wherever you get your podcasts follow us on Twitter subscribe to the morning report at 21 hats.com this episode was produced by Jess thubron founder of blank word Productions okay now you can leave thanks for listening everyone [Music]