Getting Personal With Your Staff

Could a single idea change the trajectory of your company? This one just might. Here's the idea: Go eyeball to eyeball with every new employee your company hires. Norman Mayne, CEO of Dayton, Ohio's Dorothy Lane Markets, has done just that -- and the practice has helped his company achieve margins that are more than double the industry average. You can learn about Mayne and other terrific CEOs in Donna Fenn's book, Alpha Dogs (Collins, 2006) -- a treasure trove of practical advice for leaders of small businesses.

While most companies talk about "getting the right people on the bus," Mayne actually does it. Over the past 20 years, he has met personally, in small groups, with every new employee hired by his chain of three grocery stores. And these meetings aren't just your typical meet and greet occasions. Mayne wants every person hired by the company to understand the company's culture, customers, and competitors -- and, more importantly, to understand the grocery business.

He often kicks off these sessions with the line "Ozzie and Harriet don't live here anymore -- Ozzie Osbourne is the new family." He explains that in the days of television's Ozzie and Harriet, restaurants got 15% of total U.S. food expenditures -- while today, they get 50%. "Restaurants," Mayne explains "are our competition."

And Mayne has built a tradition of restaurant-like service which has landed him on a list of the 25 most important specialty-food retailers in the nation. It has also has enabled Dorothy Lane Markets to flourish despite being located in the vicinity of 10 Wal-Mart and five Kroeger stores.
Most people know the grocery business isn't for the faint of heart. Razor thin margins, labor challenges, and the growing presence of a little company called Wal-Mart (WMT) forced 13,500 grocery stores to close during the past decade. So Mayne thinks it's important for every employee to have a sense of the economics of the grocery business.

"On a $25 grocery order, how much profit do you think we make?" he asks a group of new cashiers and stock clerks. "$12.50, $7.50, $2.50, or 75 cents?" Most are shocked to learn the correct answer is 75 cents -- and suddenly they understand the importance of watching costs.

How does Mayne know the hours he spends with new hires pays off? His turnover rate for part-time employees (almost two-thirds of his employee base) runs 20% to 30% per year -- compared to an industry average of almost 100%.

Think you're too busy to meet with every new recruit? Think again. Here are just some of the benefits:

  1. Sneak Peek. You'll get a first-hand look at the quality of people your company is hiring. You'll get insight into their motivation, how they think, and how they respond to the company's story. Be prepared for a shock -- every CEO I have seen institute this "meet every new recruit" policy has revamped the company's hiring process shortly thereafter.
  2. Vision Connection. You'll get a chance to connect each new recruit's job to your vision for the company. People will better understand why the company does things the way it does -- and will be in a position to affect those areas which are most important strategically.
  3. Direct Line. A new recruit meeting can open up a channel of communication with the CEO that employees will use to notify the CEO when they see opportunities for improvement in the firm.
  4. Value Proposition. The policy sends the signal to the new troops that they're important and that their contribution to the company matters. People who feel like they matter tend to be more conscientious and committed.

Lest you think Mayne's job of meeting every new employee is an easier task than yours would be, keep in mind that Dorothy Lane Markets hires more than 100 workers each year.
When you start your "meet every new recruit" process, remember that these meetings will only be as effective as the preparation time and creativity you put into them. A great first step is to pick up a copy of Alpha Dogs. It also describes Dorothy Lane's innovative hiring and training programs, and profiles seven other outstanding entrepreneurial companies.