How to Leverage I/O Psychology to Address Business Challenges

How Leveraging I/O Psychology Solves the Biggest Business Challenges

When you follow the latest trends in human resources, you can’t predict how they’ll impact your business. Hundreds of trillions are wasted each year because of this. And the problems get worse. 

Leveraging research in I/O psychology, you can actually predict results. 

One engagement survey we use has led to an average 40% increase in employee engagement, 49.6% higher total shareholder value, and 30% higher customer satisfaction, with long lasting results.

by Natalie Grogan, CEO of The Outstanding Company

Maintaining a productive, engaged, and efficient workforce is a monumental task these days. The most powerful untapped resource you can leverage is Industrial/Organizational (I/O) Psychology. 

I/O psychology is the intersection of business and psychology. There is a wealth of research on nearly every issue at work, both old and new, to help you avoid making decisions about hiring, managing, development, retention, and performance that have already proven to fail. 

At The Outstanding Company, we utilize I/O psychology to help businesses solve big problems that often seem to be unsolvable through trial and error. Every business problem leads back to people in some way, and that is where the change must happen. 

1. Driving Employee Engagement:

An engaged workforce is more productive, innovative, and dedicated. Driving employee engagement can be challenging and organizations waste hundreds of millions a year on failed engagement initiatives. Using I/O psychology, we delve into intrinsic and extrinsic motivators, creating an environment that promotes personal growth, recognition, and satisfaction. This approach goes beyond surface-level engagement strategies, providing lasting improvements in productivity and wellbeing.

Using research and evidence-based practices from I/O psychology, we can predict results rather than try to reinvent the wheel. In fact, I/O psychology research tells us that many of the ‘popular’ or ‘creative’ employee engagement tactics, initiatives, and software out there today do more harm that good in the long term. 

Harvard Business Review says that HR has an “adrenaline shot” problem: employee engagement is poor so they come up with some new shiny idea – the adrenaline shot. Engagement scores go up, then quickly drop. Do this enough times and your employees see right through it, becoming more disengaged because of the obvious manipulation. 

Using I/O psychology, we develop long-term, sustainable solutions to employee engagement. We measure your current employee engagement scores, develop an action plan to improve them based on your unique values, and train managers on how to understand and improve their teams’ scores. 

2.Targeted Talent Acquisition and Development:

The costs of a bad hire can be staggering, not only in monetary terms but also in terms of team morale and productivity. I/O psychology offers a solution. With evidence-based tools such as the Predictive Index, we can assess personality and cognitive abilities, and create accurate behavioral and cognitive models for jobs. This ensures you’re not just filling a position, but strategically placing the right candidate where they can excel and where they’ll want to stay for a long time. 

Personality and cognitive assessments should only be used in hiring if you are comparing the results to the needs of the role, agreed upon by multiple stakeholders. Otherwise, you are just guessing at what the role requires and bias is very likely. 

For example, if you give a candidate a DiSC assessment and the person is an INTJ but you think people who are introverted are not good at the particular job, you are just guessing. You have no data to prove that. 

If you administer a Job Assessment from Predictive Index that shows your ideal candidate is high in extroversion based on the day-to-day requirements of the role, and gain agreement from stakeholders close to the role, you now have a legally defensible reason for hiring someone with high extroversion. 

First, you need to understand and agree upon the needs of the role. Then, you can assess candidates against those needs. The same process works for employee development and coaching in their existing role. When you understand the differences between the candidate or employee’s behavioral style and the role, you can better predict on the job performance and coach that person in areas that don’t come naturally. 

3. Building Stronger Leadership:

Great leaders inspire their teams, driving them towards common goals. However, developing these leaders requires a nuanced understanding of their own and their employees’ strengths and weaknesses and how those interact with what the leader is tasked with accomplishing. By applying I/O psychology principles, we can create personalized development plans that enhance strengths and address weaknesses, fostering transformational leadership that motivates and empowers.

Developing self-awareness, leaders can better manage their interactions with others and learn what skills they need to develop. Learning about team members helps them become better at managing team members to perform at their best. When you are able to understand how people generate and value ideas, communicate, the work environment they prefer, how they manage risk, and other important business elements, you can bring out the best in their performance.

4. Achieving Strategic Alignment:

Ensuring that every team member is working towards the same strategic objectives is critical to organizational success. I/O psychology provides insights into employee behaviors, motivations, and work styles, enabling us to align teams effectively. This not only improves productivity but also boosts morale as employees understand how their contributions fit into the larger organizational picture.

Alignment on a team has two fundamental elements: alignment to each other and alignment to their share goals. Using I/O psychology we help team members learn about how to best communicate with each other. We resolve conflict by understanding this as well as differences in how they view risk, whether they are independent or collaborative, and whether their team members are proactive or responsive. These are the foundational reasons that team members have conflict and are easily resolved once you understand them. 

The other element is how the team as a whole aligns to their strategic initiatives. All strategic initiatives fall into one of 4 categories: innovation + agility, results + discipline, process + precision, and teamwork + employee experience. All behavioral profiles also fall into one or two of these categories. 

Because of this, we have the ability to see how team members align to strategy. If all team members are in innovation + agility, but our strategy is all focused on process + precision, we’re going to have a problem achieving our goals. Without knowing this, we would find out the hard way – by failing. When we have this psychometric data, we can predict upcoming challenges and get ahead of them to achieve our goals. 

 

5. Navigating Organizational Change:

Change is a constant in the business world. Whether it’s adapting to new technologies, restructuring teams, or shifting market dynamics, organizations need to be agile. Through I/O psychology, we can better understand how employees react to change and implement strategies to reduce resistance, foster resilience, and maintain productivity throughout periods of transition.

Another work-related aspect of human behavior is how people handle change. When planning major organizational change, you can predict how people will react and manage it ahead of time, before suffering backlash. Some people thrive in changing environments – they find change exciting and are also drivers of change. Others prefer things to stay steady but can still manage change well if they understand the ‘why’ behind it, and have ample notice. 

Organizational change often impacts structure, roles, employment status (layoffs/reductions), etc. Using I/O psychology, you can more strategically prepare for those scenarios and more seamlessly implement change. I/O psychology focuses on how to design organizations and jobs based on the needs of the business and its resources as well as how to align the right people and teams to those needs. This is how you successfully accomplish doing more with less. 

At The Outstanding Company, our goal is to help businesses navigate these common pain points and foster a thriving, engaged, and productive workforce. We would be happy to explore how we can tailor our I/O psychology-based solutions to your unique business needs.

Reach out to us for a free consultation to start addressing your business challenges with evidence-based methods that create predictability and long-lasting results. 

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People are still leaving: why the Great Resignation continues

Thought the Great Resignation would be over by now?

by Natalie Grogan, CEO of The Outstanding Company

Think again.

Despite looming recession and growing inflation people continue to leave their jobs in droves. 

Quick statistics, confirmed by several major surveys and studies:

40% of employees, across all industries, plan to leave their jobs within 3-6 months

65% of those employees would leave without a job lined up

36% of those who already quit, left with no job lined up

There will be a 56 million job gap by EOY - exacerbated by stagflation

The problem...

Based on the data, it seems that employers don’t understand why employees are leaving. They also don’t understand why employees stay. 

Employers are focused on transactional factors while employees are concerned about relational factors

What leaders need to do

The #1 things leaders need to do is stop putting band aids on bullet holes. The solution to retention issues is investing in employee development opportunities, understanding employee career goals and tying them in with organizational goals, and providing flexible work without sacrificing organizational needs and culture. 

However, there is a big misconception by employees that the onus should fall on the employer. Three of the biggest things employees want is a sense of belonging, a sense of purpose, and feeling valued. Employers can’t ‘make people’ feel these things. Employees must take responsibility for their own purpose and sense of belonging. 

Employers can help by conducting workshops around finding purpose. However, they cannot create purpose for people – that is on the individual. Leaders can help employees understand what it takes to ‘belong’ through workshops or coaching so that teams or groups can engage with one another to create a sense of belonging. 

It is a strange phenomenon but feelings have taken a front seat in the business world and have to be managed in some way. Working with an I-O psychologist can help you prepare, facilitate, counsel, coach, and measure results of these types of engagements and ensure that people are treated legally, fairly, and equitably in the process. 

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Stagflation is here: 51% of American companies are planning layoffs

Stagflation is upon us:
what does this mean for you, your business and your employees?

by Natalie Grogan, CEO of The Outstanding Company

51% of American business are planning layoffs. 
This is a different kind of recession than you’ve experienced in your leadership lifetime. 

Businesses have had a challenging couple of years when it comes to many things, including human capital. 2020 brought major changes to how people work, along with significant layoffs. 2021 was a rebound year for many however, employers have struggled to fill open positions. Now in 2022, we’re facing two new problems–growing inflation and sustained shrinking of GDP, aka recession. 

Inflation and recession are unique economic conditions that need different approaches to mitigate their negative effects, but what happens when both occur at the same time? It’s called stagflation and it hasn’t happened since the 1970s, when most of you reading this were teenagers, children, or not yet born. If you’ve never experienced it, then how will you deal with it? How will you protect yourself, your business, and your employees? 

Let’s discuss.

What is Stagflation?

Stagflation occurs when inflation and recession are happening at the same time. Inflation and recession are two of the most significant challenges that business owners and leaders face. Each of these economic conditions are unique from one another and require complex solutions. “Common sense” solutions often cause more harm than good, especially when dealing with business and human capital. 

State of Affairs

Two quarters of GDP decline plus inflation averaging near 9% tell a challenging story. Bridgewater Associates, one of the top investment management companies in the world, published an update from their Chief Investment Officers on July 25th titled, “Transitioning to Stagflation”. Ray Dalio, billionaire, genius economist, and former CEO of Bridgewater has been predicting this for quite some time. 

Back in June, the World Bank published their prediction of years of upcoming stagflation. This should not be taken lightly by anyone—for both business and personal decision-making.

The July 2022 jobs report indicated that 528,000 jobs were added.  Unfortunately, over 80% of those jobs were recovered from the pandemic and not truly ‘new’. 

Inflating numbers through semantics and spin is grossly unhelpful. To effectively prepare, leaders need to acknowledge the reality. A surge in hiring does not indicate a lack of recession. The New York Times even published an article last week called, “Good News on Jobs May Mean Bad News Later”.

Unemployment is currently reported to be about 3.5%. This is misleading because it’s based on the number of people participating in the workforce, which has dropped significantly in the last 18 months. According to the Society for Industrial Organizational Psychologists (SIOP), the “Great Resignation” continues and a 56 million job opening gap will be upon us before Q1 2023. Dependent on industry, 32-47% of people are still ‘somewhat likely’ to voluntarily leave their jobs in the next 3-6 months. I highly advise these people not to quit due to the upcoming economic challenges. However, many organizations don’t understand what people want or treat them poorly, and then some people simply have a distorted view of what their employer should provide.

Major layoffs have  already begun. Nearly every industry will be impacted by this, with tech currently experiencing the most widespread layoffs, dubbed by the VC world as a #SaaSsacre – Software as a Service (Saas) and massacre. Unfortunately, this is only the beginning.

The 528k jobs added in July will shortly be considered an overshot of epic proportions. The investment app Robinhood recently laid of 23% of their workforce after slashing 9% earlier this year, for lack of user investments. Peloton laid off another 2,000 employees in July, after laying off 2,800 in February. Wells Fargo, Netflix, Tesla, JP Morgan, Coinbase, Microsoft, Groupon, iRobot, Oracle, Shopify, Microsoft, Carvana, Better.com, and dozens of other well-known tech companies have laid off significant numbers of employees so far this summer.

What leaders need to do

Stop. Evaluate. Strategize. Plan.

The number one way to survive stagflation is to improve your organization’s productivity. How do you do that when the life if squeeze out of your budget?

  1. Review your business strategy and meet with your leadership team to realign on strategic goals – we offer an incredible workshop to work through leadership alignment to business strategy.
  2. Take stock of existing talent. Rank essential roles and define what success looks like for each. Objectively identify top performers and what makes them such, now.
  3. Develop top performers. If you do have to lay people off, your remaining team will have to pick up a lot of slack to keep the business going. What are these top performers good at? What motivates them? Where else can they bring value? Are critical teams balanced with generalists and specialists? Find out what you don’t know.
  4. Define a succession plan. People are leaving the workforce in droves, and you’ll need to have a backup plan to swiftly act when the time comes. No need to act on it immediately and I hope you never have to…but you will.  
  5. Discuss owner/executive sacrifices that may be necessary. How can the business continue to operate profitably through a relatively short-term crisis? Who is willing to make sacrifices to keep it going?

Prepare your employees

Odds are that you and/or the majority of your employees have never experienced stagflation, at least as an adult in the workforce. If you want to keep employees engaged and productive, while doing the best you can to support them, you need to be honest. You have a unique opportunity to educate and prepare them for what is likely a challenging road ahead. Building resilience in employees is critical, and it’s a teachable trait. Sharing also gives employees an opportunity to step up and help curb the impact, instilling feelings of being in it together and strengthening their sense of purpose and importance. 

Here are the four ways that you can prepare your employees, while improving overall engagement and productivity.

  1. Education: what recession, inflation, and stagflation mean and the impact from the perspective of the individual, the family, the consumer, the employee, the organization, etc. For example, most don’t realize they’ve been a victim of ‘shrinkflation’ already—the decrease in size or quality of consumer products while keeping them the same price.
  2. Planning: define critical roles, ensure the right people are in them to lead during change and pick up slack, while developing levels of succession and right-sizing plans. Hopefully you never have to use them but many of you will.
  3. Retention: the Great Resignation is still in full effect (although foolishly). Identify needs and create development opportunities for top performers to ensure they stay with you, are prepared for different scenarios, and can step into critical roles in the case of downsizing.
  4. Leadership: stabilize your leaders (and yourself) to ensure resiliency in managing both work and personal stress. Remember, it’s important to be relatable, practical, and meet people where they are. It’s possible you’ve worked hard on resilience and self-awareness in yourself but others may not. 

Share this 5 minute assessment with your team to start working on self-awareness.

What to do next...

You have an opportunity to be an outstanding leader of your outstanding company. People are uncertain of what is coming and leading them through it, with honesty and integrity, will go a long way to ensure your and your company’s reputation, regardless of what the future holds. 

Everything discussed here are services The Outstanding Company helps organizations facilitate. If this interests you, let’s have a conversation. There’s no obligation to work with us and we will gladly sign a mutual NDA.  

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How Founders and Investors are Almost Always Leaving Money on the Table

How founders, leaders, and investors are almost always leaving money on the table

by Natalie Grogan, CEO of The Outstanding Company

Preface: People and Culture = Money

A quick note before you read, so you know where I’m coming from when I talk about People and Culture. I’m a business strategist, talent optimization consultant, and soon-to-be master of I-O psychology. I don’t buy into fluffy employee ‘engagement’ techniques. I use data to develop strategies, coach leaders and employees, and build out hiring, management, and review processes. 

My focus is getting the right people in the right seat, being managed in a way that helps them develop and grow, by an excellent leader, who has the support they need. The outcomes we achieve are reduced voluntary turnover, improved productivity, job satisfaction, organizational commitment, and a positive impact on business results.

Every effort must have a  three-fold purpose that improves productivity, employee experience, and the bottom line.

The Missing Piece

Most investments, and companies in general, under-perform because of issues with people and culture. Sometimes they don’t even know it.

On due diligence committees for investors, my focus is on the people. Who does this organization currently have working for them? What are they wired to do? Who are they missing? Who do they need that aligns with the organizational goals? 

People are what stands between an excellent business strategy and achieving exceptional results, so we need to get that right. 

The problem is, we tend to only look at founders and key players, and we focus on their knowledge, skills, and past successes. We don’t look much deeper into people and culture. 

Who Are These People?

During due diligence, we look at founders and leaders, along with their knowledge, skills, and experience. We look to their past and subjectively attempt to predict the future.

This is usually a combination of the ideas people and the business people. They have already created something of value and are looking to expand their reach. Some of these people are new entrepreneurs and some have had success in other ventures. 

Regardless of individual successes, this is a new team. We can’t predict how this team will work together and the team make up is vastly more important than the individuals on it.

Think about it this way, if your leadership team is made up of 4 fast-paced, change driven, independent, and assertive people, who is on quality control? Who is saying, “hold on, let’s talk about why we need to make this change”? Who is documenting the processes and all of these changes and holding the team accountable to results?

Hint: it’s not those 4 people because that is not how they operate. But, how do you know that? Do they even know that? We have scientifically validated tools to figure out. Email me if you want to know more about that. 

A Look at Our Team Analysis Process

What About Everyone Else?

Say we fund this company. We still really don’t know who works there. When an organization has 20 employees, everyone’s contributions are absolutely critical.

Startups are usually made up of a few specialists (the technical people) and a lot of generalists who can take on a variety of roles like operations, sales, and marketing. How do you know who’s a generalist or specialist? 

Take marketing for example. If you’re looking for a marketing generalist, most marketers will say they can be a generalist. They may have experience dabbling in digital, print, paid, PR, etc. but their real talent is marketing strategy or data analysis.

Just because they have experience executing on marketing doesn’t mean they like it, are good at it, or are wired to do it. Trust me on this one–I just described myself in a past career.

The Wrong Person is Easy to Find

Every day and every dollar counts in a startup, yet people decisions are largely based on either saving money or hiring a ‘superstar’ from another successful company.

The cost of hiring the wrong person is expensive in any organization. Replacing a $50k salaried, entry-level employee costs a minimum of $17k and it only goes up from there. Startups (or any org) can’t afford to lose that kind of money, time, momentum, or morale. You need to get the right fit for the job, team, and organization the first time. Calculate turnover cost here.

The point I’m trying to make here is that we don’t do enough when it comes to aligning people and strategy. Startups can make hasty and subjective hires (90% of companies hire subjectively) and investors have no idea.

We need to do better at aligning people and teams. Why wouldn’t you? If you don’t know how, we can help. It pays for itself if you prevent ONE employee from leaving and you’ll see much better results than that. Find out more about that here. 

Culture as a Liability

The second issue with startups, investments, and fast-growing companies is culture. No matter how badly a company wants to keep their startup culture, it’s going to have to  change.

Lots of the amazing tech startup culture stories you hear are mired in complaints from the non-Kool-Aid drinkers. Organizations have expensive publicists that push the ‘we’re so cool’ narrative. Don’t believe everything you read.

Believe it or not, culture is one of the biggest reasons that investments, whether M&A, PE, VC, or AI, do not perform as well as expected. 

What people fail to realize is that, without effective intervention, big culture changes lead to less organizational commitment and employee engagement. Less organizational commitment and reduced employee engagement lead to reduced productivity, increased voluntary turnover, and a slew of other tangible, costly failures.

M&A is an obvious challenge-bringing together two companies whose cultures most likely differ substantially. There are four approaches to integrate the companies: preservation, absorption, symbiotic, and transformational. 

Preservation: Each company operates on its own, maintaining control and culture. 

Absorption: Dominant company absorbs and integrates smaller company. 

Symbiotic: New organization forms, bring the best of company A and the best of company B.

Transformational: New organization forms, merging the best of company A and best of company B while also integrating new external best practices.

Changing Culture

Startup culture is not ping pong tables, boozy lunches, and happy hours (although that often happens and I’ve never complained). Startup culture is about commitment, hustle, and driving the greater good of the organization.

As mentioned above, startups are usually made up of a few specialists and the rest, generalists. Once you’re funded, that changes, or at least should. You’re able to, and need to, hire more specialists and divide responsibilities differently. In itself, that changes the culture. 

There are many studies and data that address organizational culture changes, before and after mergers and investments. The data examines the cultural dimensions of the original organizations–clan, adhocracy, market, or hierarchy, and predicts outcomes post-merger.

If you’re not familiar with those buckets of culture, here’s a quick overview:

The Clan: Human affiliation – employees value attachment, collaboration, trust, and support

The Adhocracy: Change – employees value growth, variety, attention to detail, stimulation, and autonomy

The Market: Achievement – employees value communication, competence, and competition

The Hierarchy: Stability – employees value communication, formalization, and routine

The elements that form each type of culture are: adaptability, detail orientation, results orientation, people/customer orientation, collaboration/team orientation, and integrity.

Cultural fit requires employees to have a shared understanding of the organization, how things are done there, and how they are supposed to behave.

Here are two distinct cultures at company A and company B. What do you think happens when they merge or need to grow fast?

The Bottom Line

You don’t have to go in blind, when it comes to people. A company is much more than just the individual leaders.

In mergers and acquisitions, both companies’ cultures should be evaluated and an intentional culture determined before the merger is even announced.

Startups should have clearly documented and agreed to plans for future culture development and the new culture should be embraced as the next step in an awesome journey. 

The Outstanding Company uses I-O psychology principles and data to analyze company culture, facilitate culture development among leadership teams, and supports managers at reinforcing culture at all levels. 

Talent Optimization Advisory services will help you understand, develop, and implement impactful culture initiatives that will transform these organizations into power-houses full of highly productive, committed, and engaged employees.

If you want to learn more, please reach out to hello@theoutstandingcompany.com

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What do you really know about your people at work?

Managing without people data is managing blindly. Talent Optimization provides a framework to harness the value of people data and easily turn it in to action. Using the Talent Optimization framework, you remove the guess-work, simplifying major aspects of leadership, management, and development and it always results in saving money and improving productivity. 

We welcome the opportunity to introduce you to Talent Optimization, implement these tools within your organization, and work with you to continuously improve your business results year after year. We empower your teams to use the tools and are here for you when you need us. 

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Why most managers fail at managing and leading

Why most managers fail at managing and leading

by Natalie Grogan, CEO of The Outstanding Company

We know that management is a critical and complex function of organizations. Unfortunately, manager training and development are extremely lacking. In fact, 58% of managers in a large-scale study said they never received any training and 25% said they were not ready to lead when they got the job. 

To manage people, you first have to understand the basic functions of managing and develop certain competencies. If you train your managers in these areas, you will see exponential success.

My question to you is, even if your managers were only 10% better than they are now, what would that mean for that individual, their team, and the organization as a whole?

Consider the financial, emotional, and cultural impact of 10% less turnover, 10% more revenue, 10% better client retention, and 10% happier employees. That’s a pretty big deal for offering better training to just a single manager. Expanded through your organization, it is a game-changer.

The Three Types of Managers

Managers fall into one of three categories: efficient, effective, and productive.

Think of the managers on your team and where they fall into these categories, as we look at the functions of management and the competencies needed to reach the “productive” category.

  • Efficient managers get the job done using minimal resources.
  • Effective managers understand how to set the right goals, or where to focus the team’s activities and energy.
  • Productive managers combine high efficiency and high effectiveness, achieved through developing management competencies and mastering management functions.

I Bet You Can't Name the Four Functions of Management

As an experienced manager, when was the last time you considered what the four functions of management are? Maybe never. Unless you went to school for business, HR, or I/O psychology, you may have never learned them. So, how do we expect managers to become outstanding at their job, if they don’t even know what it really entails? The four categories of management activities are: planning, organizing, leading, and controlling.

Planning is the foundational function, revolving around goals. Defining goals, laying out the strategy for achieving them, and mapping how to execute the strategy all fall into the planning category. This is not something most people learn prior to becoming a manager. Of course, planning becomes more complex as a person grows in their career so building this foundation early is critical—but often overlooked.

Organizing follows planning and is focused on the day-to-day execution of the strategy. Breaking the strategy into tasks, deciding who should execute them, creating a team structure, and determining who makes decisions are all elements of organizing. How does a person who has never managed naturally know how to do this? They generally do not.

Leading facilitates getting things done by supporting the team. Aspects of leading include motivating employees, directing them on where to spend their time and what to do, establishing clear lines of communication, and resolving conflicts that may arise. Leading is a blend of hard and soft skills, some of which are innate but most of which must be learned and we’ll get into those shortly.

Finally, controlling examines results. Managers are responsible for making sure that their team’s activities are supporting goal achievement. Controlling includes measuring performance progress and making appropriate adjustments when goals are not being achieved. Remember, an effective manager sets the right goals and focuses the team’s activity. We don’t know if effective managers take a long time or spend a lot of money in the process. Efficient managers get things done in the least amount of time/effort/money but we don’t know if they’re getting the right things done. Productive managers are those who achieve results by being efficient and effective.

What kind of difference would it make if your managers were taught all of this up front and then built on the knowledge through hands-on experience?

Management Competencies

Suryanarayana (2017) identifies eight management competencies that fall into three categories: personal skills, interpersonal skills, and group skills. Personal skills relate to the management of the self and incorporate self-awareness, stress management, and analytical and creative problem solving. Interpersonal skills address building relationships, influencing others, and conflict management. Finally, group skills are those related to empowering others, delegating, and team building.

Every single competency is important, and they all influence one another. Through my experience consulting and education in I/O psychology, the following three competencies are what I believe contribute most strongly to organizational productivity and that should be required learning for all new managers.

Critical Management Competency #1: Self-awareness

Self-awareness is the absolute #1 most valuable thing for a manager to grasp. Tasha Eurich, an organizational psychologist, did an incredible study on self-awareness. She found that 95% of people believe they are self-aware. She also found that only 15% of them actually are. That means that 85% of the people you talk to every day are likely not self-aware.

What does self-awareness translate to in the workplace? It helps us learn what innately motivates us, how we communicate, how we naturally prefer to work, whether we make decisions subjectively or objectively, and more. The game-changer is being able to apply these at work to become more productive.  

You can’t understand yourself without understanding others and you can’t understand others without understanding yourself. Everything is in context. If you don’t developing self-awareness you’re not going to be nearly as successful in building relationships, influencing others managing conflict, empowering others, delegating, and building teams—all management competencies.

Client Story: I was working with a C-Suite client who has put a lot of time into developing self-awareness, using my favorite tool The Predictive Index (PI). Through the 5 minute PI assessment and self-reflection she knew that her natural state is assertive, fast paced, driven to get things done, informal, casual, and unstructured. She had been struggling with her employees not understanding what was expected of their work and doing things wrong. Her self-awareness development helped her understand that she wasn’t managing people in the way they needed her to. Because of her nature, she would give them directive instruction (assertive), assume they understood (informal), and expected them to move quickly (fast paced), and ask questions if they had them (unstructured). Maybe some people on the team worked the same way as she did, but most did not. She understands now that becoming aware of her work style and learning about the people on her team’s work styles can help her become more efficient, effective, and ultimately more productive.

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Critical Management Competency #2: Stress Management

Poor stress management can impact all areas of life and definitely organizational productivity. The physical and emotional impacts of stress can derail the other competencies like creative problem solving, influencing, maintaining positive relationships, and effectively managing conflict.

Case Study: In my experience, before I developed a stress management practice, stress could overwhelm me, and both my work and relationships suffered. Unmanaged stress impacted my communication skills, led to short or frustrated conversations and the inability to manage conflict well. Poor communication skills also led to inability to influence others, empower them, and delegation was nearly impossible. Developing a stress management practice leads to stronger resilience. Resilient people are extremely valuable because they can handle setbacks and get right back up and keep moving forward. Resilience supports nearly all the management competencies.

Critical Management Competency #3: Empowering Others

Empowering others is a learned skill that can transform individual and team performance and should be taught all day every day. A lot of managers do the opposite. When managers feel threatened, they tend to seek more control. Empowerment means helping develop people to be self-efficient, self-determined, take personal control over their activities and that leads to more meaning and trust. People are then able to accomplish things on their own and are actually more likely to. Empowered employees are most satisfied, innovative, trustworthy, effective, and have higher levels of morale and commitment. It also takes a lot of work off the manager in the long run.

Case Study: In the self-awareness example above, understanding yourself and yourself in relation to others can lead to incredible break throughs. The client in that example learned valuable empowerment skills by first understanding that detailed delegation did not come naturally to her. She valued empowering others prior to working on self-awareness but she was not providing them enough tools to feel empowered. Ultimately, her self-awareness work led to better empowerment and delegation.

Better Managers, Better Work, Better World

Management often seems like a natural promotional step for people who are growing with an organization, perform well, or exhibit leadership skills. However, not everyone is cut out to manage, and most do not show up on the first day of the job with an understanding of managerial functions and competencies. Well-developed manager training programs could have a major impact on organizational productivity but is still lacking in both formal education and on the job.

The Outstanding Company has created a Management Training Program based on these principles of Industrial-Organizational psychology to help your managers develop the skills they need to be outstanding at leading and managing other people. If you’re interested or would like to nominate someone, please fill out this form.

References

Robbins, S. P., & Judge, T. (2019). Organizational behavior. Pearson Education Limited.

Suryanarayana, A. (2017). Critical role of managerial competencies in productivity enhancement interventions: a HRM perspective. In C. Machado & J. P. Davim (Eds.), Productivity and Organizational Management. Berlin: De Gruyter.

What do you really know about your people at work?

Managing without people data is managing blindly. Talent Optimization provides a framework to harness the value of people data and easily turn it in to action. Using the Talent Optimization framework, you remove the guess-work, simplifying major aspects of leadership, management, and development and it always results in saving money and improving productivity. 

We welcome the opportunity to introduce you to Talent Optimization, implement these tools within your organization, and work with you to continuously improve your business results year after year. We empower your teams to use the tools and are here for you when you need us. 

Click to Schedule an Intro Call

How can the Great Resignation improve your organization?

How can the Great Resignation benefit your business?

by Natalie Grogan, CEO of The Outstanding Company

The Great Resignation of 2021! Is it real or sensationalized?

I don’t necessarily believe the hype about it but I do believe substantially more people than usual will continue to move on to what they perceive are greener pastures.  

When there is uncertainty, people stay put. Now that things are somewhat back to normal, those who were considering a move pre-pandemic feel more comfortable moving forward with it. It just happens to be occurring all at once. There are, of course, some pandemic-related reasons that people want to leave companies, too. 

Great Resignation Opportunities

Numbers + Reasons

2.7% of people quit their jobs in April 2021 – that’s a huge number. The numbers vary by source, but CNBC says that 24% of U.S. workers say they want to leave their job this year. 80% cite concerns about career advancement. 72% say they have reconsidered their skill set since the pandemic and many took the opportunity to learn new skills in some way since last year. Many of them are also looking for more flexibility. A major note on that, though: it’s much easier to answer a survey question about wanting to leave your job than it is for most people to have the guts and comfort with risk to quit and the wherewithal to endure searching for another role. I have a feeling the actual number will be lower. 

Related or Unrelated Retention Issues

Here’s the thing – you may lose some employees and you’ll want to replace them quickly. This happens all the time, right? Right now, people will likely have a lot of options. Lots of job inventory, lots of candidate inventory. It’s going to be a competitive market.

Don’t settle for warm bodies.

Absolutely DO NOT replace people just to get a butt in a seat. You’ll regret it within 6 months.

Hiring the wrong person will cost you at minimum 30% of their annual salary when they quit. This is often overlooked and that’s the most modest number for an entry-level employee. If you’re hiring directors or executives, the number is 100%-200% times their annual salary.

Demands are Different Now

Regardless of your experience with the Great Resignation, the mindset about what employers should do for their people has shifted. That is not to say you should pander to demands that have no impact on wellbeing, satisfaction, and performance. In fact, pandering to demands usually makes the problem worse and demands greater. People who feel entitled to make these kinds of demands are also more likely to be those who pursue litigation. Yet another reason to carefully vet through the hiring process.

Before You Hire More People...

Here’s what you need to do:

  • Assess existing talent: Who might be able to step up and fill the empty roles? Where can you rearrange and/or up-skill existing employees?
  • Examine team dynamics: Do you know everyone’s strengths? Blind spots? What about the team’s strengths as a whole? You want to hire the person who is going to complement your existing team and bring new strengths to the table.
  • Establish your new working environment: How is your organization working moving forward? Remote? Hybrid? In-office? You can’t bring in new people until you’ve decided, identified push-back and other challenges, and created a plan to fix that. If you bring new people on with the promise of hybrid or remote work and then decide you need to go back to the office, they will leave.
  • Invest in your people: You will need to differentiate. Why do people want to work for you, other than a paycheck? Money is not even in the top 10 on the list of candidate priorities. You need to communicate how you’re planning to invest in your current employees before you can sell it to candidates. Do you know what your people want and need to be satisfied and productive?
  • Re-evaluate company policies and communicate them often: Workplace litigation has been up substantially in 2020 and 2021. Many employees are taking advantage of changing environments and priorities for financial gain. Unacceptable behavior must be documented in policies, communicated to all employees and enforced by all people managers. Do not bring on new employees without this already established. 

My Best Advice: Hire Slow + Use Objective Data

Hire slow. 

I know that’s not ideal but you’re asking for a plethora of problems if you make hasty decisions. Get to know the person. See how they fit with the team. Find out what motivates them, what they’re naturally good at, and whether that’s important to your organization, team, and the manager’s goals. How do they like to work? What kind of opportunities are they looking for? If you can’t provide these things, say no. Warm bodies are not better than nothing!

Use objective data. 

If you’re not performing a job analysis prior to hiring, you’re putting your business at risk. If you’re not looking at candidate behavior profiles in relation to the job analysis, you’re putting your business at risk. If a new hire doesn’t work out, you need to be able to explain why, in the context of being able to perform the job they were hired to do. Litigation is rampant right now and judges only care about the perception of “fairness”, not reality. A documented job analysis, objective hiring measures, and signed agreement from all parties will help cover your tail in case of litigation. I am not a lawyer so this is not legal advice but is well-documented in the I-O psychology realm.

Don't Know Where to Start?

If you need help with this, we have straightforward, repeatable, teachable processes to address every aspect with leadership, managers, teams, and even your entire workforce. You have an opportunity to re-establish your priorities, develop better teams, and improve performance if you take this opportunity to do this correctly.

I am Natalie Grogan, CEO of The Outstanding Company, I-O psychology Master’s candidate, and Talent Optimization expert. Here is my personal calendar link if you’d like to get in touch! 

If you don’t want to talk but you have some questions or concerns, feel free to drop me a line at natalie@theoutstandingcompany.com.

Try the 5 Minute Assessment

What do you really know about your people at work?

Managing without people data is managing blindly. Talent Optimization provides a framework to harness the value of people data and easily turn it in to action. Using the Talent Optimization framework, you remove the guess-work, simplifying major aspects of leadership, management, and development and it always results in saving money and improving productivity. 

We welcome the opportunity to introduce you to Talent Optimization, implement these tools within your organization, and work with you to continuously improve your business results year after year. We empower your teams to use the tools and are here for you when you need us. 

Click to Schedule an Intro Call

Hiring Based on Gut Feeling is Inherently Biased

Hiring Based on 'Gut Feeling' is Inherently Biased

Hire fairly, promote equitably, and unlock every employee’s potential

by Natalie Grogan, CEO of The Outstanding Company

Unfortunately, there is not a human soul in this world who exists without bias. 

I am biased in favor of Chianti, Peloton, and people who communicate directly. 

No one really cares what I like to drink or how I like to work out and those things have minimal impact on others. 

I like people who communicate directly because I communicate directly. This is an example of affinity bias and could pose some big problems in my business.

Hiring people who are just like me is not going drive success. 

95% of leaders think they are self aware

Bias is not always about how a person looks, where they’re from, or how they live their life. We have biases about communication style, assertiveness, big personalities, quiet personalities, and a whole lot more that show up throughout our work life.

We spend our entire lives gathering information from our surroundings – our families, teachers, communities, workplaces, and the media that we consume. Our brains are processing massive amounts of information every second of the day. Our brains need to organize information in a way that is quickly accessible so it builds shortcuts to make decisions easier. 

This creates unconscious biases that are automatic, unintentional, deeply ingrained thoughts that influence how we behave. 

Unfortunately, our thoughts are not always true.

Self-Awareness is the Missing Piece

Learning and understanding your own biases requires a high level of self-awareness. In her book Insight, Tasha Eurich’s research shows that 95% of leaders think they are self-aware but in reality, only 10-15% actually are. 

Naturally, this means that a high percentage of people are out there not knowing they are not self-aware and therefore, not trying to become more self-aware. Does that make sense? 

Ironically, the #1 predictor of success in managerial and leadership roles is…self-awareness.

(If you’re ready to do some introspection, you can start with this 5 minute assessment)

If you are not taking the time to develop self-awareness, spending time to notice what your biases are, where they come up, and actively trying to undo them, you’re not going to make progress. 

In addition to your own learning, The Outstanding Company’s talent optimization solutions can help make decisions more objective and reduce biased in hiring and management.

Can We Eliminate Bias Altogether?

We have to be honest – there is no way to completely eliminate hiring bias. Our brains are wired for it. The only way to reduce biases and discrimination is to develop that high level of self-awareness and awareness of others.

Self-awareness turns on a switch that helps you notice when biases are coming up so you can correct before acting on them. Self-awareness, especially in management and leadership, is critical to reducing discrimination in the workplace and creating a culture where all people are welcome, included, valued, and given opportunities to learn and grow.

Biases show up in the workplace in the recruitment process, employee development and coaching, promotion pipeline and succession planning, and performance management. If not addressed, this can lead to a competitive, anxious, and hostile working environment.

Types of Biases

Biases can be related to many factors, such as age, gender, sex, race, sexual orientation, pregnancy, ability, national origin, and religion. They can also be related to anything we have opinions about, such as weight, attire and appearance, communication style, the car someone drives, or where they went to school.

Common unconscious biases are:

  • Affinity bias: we favor individuals who have similarities to ourselves.
  • Attribution bias: we credit our successes to our merit and hard work, and our failures to external factors, but credit other people’s successes to luck and their failures to their personality or own shortcomings.
  • Conformity bias: when the people around us unconsciously sway our opinion.
  • Confirmation bias: we unconsciously seek out, focus on, and remember information that confirms your existing beliefs and opinions.
  • The Halo effect: we focus on one great thing about someone, such as their education or one professional success story, and let it positively influence everything else that they say or do. 
  • The Horns effect: we focus on one negative fact about someone and it negatively impacts everything else about them.

Applying This Knowledge

Going back to my earlier example about my bias against people who do not communicate directly – that is affinity bias: I like to tell it like it is so I prefer that others do the same.

If I was a hiring manager unaware of this bias, I would dismiss exceptional candidates based on their behavior in a job interview. Fortunately, using the Predictive Index talent optimization framework, I can avoid this. When I hire, I have access to each candidate’s profile.

A person who doesn’t communicate directly could have a collaborative nature, where they seek buy-in from others. They could be more introspective and need time to think before speaking. They could be extremely patient or extremely formal, not wanting to say anything before they are absolutely sure it is true. None of those attributes is grounds for disqualification and, because I have this information, I am aware of why candidates behave the way they do.

Tools for Hiring, Promotion, and Management

The PI Behavioral Assessment (BA) collects data from an individual to create a unique behavioral report that explains this person’s drives, needs, and general temperament. 

The PI Cognitive Assessment (CA) measures how quickly a person can process and learn new information. Paired together, these assessments are strong indicators of job success when used correctly. 

The PI Job Assessment allows stakeholders to select skills, cognitive abilities, and temperaments required to do a specific job at your company. The software then creates a Job Target that you use in the hiring process for a new role or when promoting an internal candidate.

The platform provides job descriptions that speak to the profile you selected as well as structured interview questions. The interview questions focus on fit-to-role and are another tool to prevent bias. 

By aligning your candidates BAs and CAs with the Job Target, you can identify the best candidates for that role using science, and reduce hiring bias in the interview process.

"Gut Feeling" Hiring is Not Reducing Bias

Recruiters, managers, and other interviewers often make a decision about a candidate based on their “gut feel,” which is typically rooted in their unconscious biases. 

By leveraging the PI Behavioral and Cognitive Assessments, Job Assessment, Job Target, and interview guides, your interview team can make more objective hiring decisions.

While the PI platform doesn’t solve social injustice, it can – and does – remove bias to help create more diverse companies. It enables you to hire fairly, promote equitably, and unlock every employees’ true potential. 

Learn More
Click to Schedule an Intro Call

What is Talent Optimization?

What Exactly is Talent Optimization?

by Natalie Grogan, CEO of The Outstanding Company

We get asked this all the time so thought we’d break it down for you!

Talent Optimization is the practice of using science and data to align your business strategy with a talent strategy to achieve desired business results. 

Most companies have a business strategy but do not have a talent strategy beyond “we’re hiring 10 people this year for x, y, z roles”.

On the right, you can see the T.O. cycle. It is continuous because business environments are always changing with new strategic goals, team members, roles, leaders, and managers.

Talent Optimization Framework

Talent Optimization is founded in developing self-awareness and awareness of others, the #1 predictor of success in management and leadership. It is made up of four pillars and is used throughout the entire employee life cycle, from the pre-hire process and creating models of roles through retirement and succession planning. It is used with every single employee and every single candidate to design a workforce that is going to achieve your goals, and do it because they want to, not because they have to. 

Pillar 1: Design

Design examines your strengths and blind spots as a leader, your team members’ strengths and blind spots, and how that all aligns with the business strategy you are pursuing. 

  • Develop self-awareness as to who you are as a leader
  • Discover your team’s strengths and blind spots
  • Align your team with the strategy you’re pursuing
  • Predict leadership team dynamics
  • Design a culture that will support your business goals
Here’s a quick overview video of Design in action. 

Pillar 2: Hire

Hire uses the Predictive Index Behavioral Assessment, Cognitive Assessment, and the Job Assessment.

The Job Assessment is a 10 minute survey taken by stakeholders – manager, director, HR, etc. – to develop an agreed upon standard for each role. This job profile is used to see how candidates match up to the type of person who will do the job well, for a long time, so you get the best-fit hire, the first time.

Each candidate takes the 5 minute Behavioral Assessment and is overlaid on the agreed upon job requirements to easily see where the candidate is in aligned to the role and where there are gaps. This also provides an onboarding framework to share with new hired, outlining exactly why you hired them for this role, and predicting where they might need some coaching, from the start. 

  • Define job requirements and get 100% buy-in from all stakeholders 
  • Equip hiring managers to attract and select the best talent
  • Drastically reduce bias by using science to hire objectively
  • Onboard employees with a clear understanding of expectations
  • Understand team dynamics and fill strategic gaps
  • Predict success up to 65% better than using intuition and interviews
 
Note about the Predictive Index Behavioral Assessment: 
The PI BA is one of the only tools appropriate for the pre-hire process. Tools like Myers-Briggs and DiSC can provide great insight but are daunting in terms of time. They also use a forced-choice format meaning that the user has to choose an item such as “most like me” or “least like me”. Studies show that there is too much variability in how people make that choice and is therefore inappropriate for hiring decisions (Meade, 2004). The Predictive Index BA is a free-choice assessment where the user only chooses what answers make sense to them.
Try the 5 Minute Assessment

Pillar 3: Inspire

Inspire is all about development and engagement. Existing employees’ Behavioral Assessment results give us deep insight into what drives and motivates them. Comparing them to the JA gives us concrete coaching advice to prevent things like burnout and future challenges in the role and with the team, manager, and organization. 

  • Identify and develop your top-performers and next leaders
  • Use science to identify areas that need coaching
  • Predict burnout and misalignment with Self-Concept using the BA
  • Create career paths to give employees something to work towards
  • Create high performing teams 
  • Reinforce your culture
  • Learn how to promote using predictive analytics 

Pillar 4: Diagnose

Diagnose is the Employee Experience Survey paired with the Take Action on Engagement Workshop. Diagnose gives us insights into how your employees are experiencing their job, manager, team, and the organization at the individual, team, and company-wide levels. Unlike other employee engagement surveys, the questions are pre-developed, based in Industrial-Organizational Psychology, to measure what is really important. 

When companies send out engagement surveys but do nothing with the results, it makes engagement worse. Take Action on Engagement ensures that the action items from the survey are clear, owned, and are being implemented so employees can see that you are serious about improving. 

  • Measures employee engagement across the four factors of disengagement: Job, Manager, Team, Organization
  • Find out if your company, team, and individuals are rowing in the same direction
Learn More

What do you really know about your people at work?

Managing without people data is managing blindly. Talent Optimization provides a framework to harness the value of people data and easily turn it in to action. Using the Talent Optimization framework, you remove the guess-work, simplifying major aspects of leadership, management, and development and it always results in saving money and improving productivity. 

We welcome the opportunity to introduce you to Talent Optimization, implement these tools within your organization, and work with you to continuously improve your business results year after year. We empower your teams to use the tools and are here for you when you need us. 

Click to Schedule an Intro Call