Venture New Employee Marketing
Dr. Michael Merz
Department of Marketing & Decision Sciences College of Business San Jose State University
Today's Agenda
Employee-Customer-Profit Model Internal Branding Leadership Four Vital Tasks of a Leader
Hiring the Right Employees Building an Organizational Culture Communicating New Venture Vision and Values Motivating Employees
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Employee-Customer-Profit Model
Employees (or internal customers) affect customer satisfaction and profit.
Employee satisfaction
Customer satisfaction
Profit
5%
Example: Sears
1.3%
0.5%
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Source: "The Impact of Employee Attitudes on Market Response and Financial Performance"; Harvard Business Review.
Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Employees are the Brand
"Employees are your brand" (Karen Post, branding consultant). A moment of truth occurs when employee and customer have contact (e.g., service industry). Committed employees help:
Build your brand outside the walls of your organization. Stay at your new venture longer. Work harder.
Example: Adobe, Harley-Davidson
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Employees are Very Valuable
Companies with high employee engagement outperform others. 17% gap in net income growth -4% Low Year 2
Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
vs. 100% Year 1
Source: ISR
+13% High
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Internal Marketing
Internal Marketing is the Management Philosophy of treating employees as customers (hence, employees = internal customers).
Objective: To attract and retain good employees (hire). To provide employees (part time marketers) with adequate support (build). To ensure that internal services are provided in a customer oriented manner (communicate). To ensure that employees fulfill their duties as part-time marketers (motivate).
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Leadership
Process of influencing and inspiring others in the New Venture to work to achieve a common goal and then giving them the power and the freedom to achieve it. Entrepreneurs must take on many roles in their companies, but none is more important than that of leader.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
How do "leadership" and "management" differ?
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Four Vital Tasks of a Leader
1. Hire the right employees and constantly improve their skills. 2. Build an organizational culture and structure that enable the new venture to reach its potential. 3. Communicate the vision and the values of the new venture and create an environment of trust . 4. Motivate employees to higher levels of performance.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Case: Southwest Airlines
1.) How does Southwest recruit employees and help improve their skills? 2.) How does Southwest build an organizational culture and structure that helps it reach its full potential? 3.) Does Southwest communicate its vision and values and create an environment of trust? 4.) How does Southwest Airlines motivate its employees to higher levels of performance?
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Hiring the Right Employees
Study: 80 percent of employee turnover is caused by bad hiring decisions. DDI study: 34 percent of hiring managers admit to making bad hiring decisions because they were under pressure to fill a job. Entrepreneurs need to learn how to avoid hiring mistakes!
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Hiring the Right Employees
Elevate recruiting to a strategic position in the New Venture.
Look inside the company first. Encourage employee referrals. Make employment ads stand out. Use the Internet as a recruiting tool -> expand a new venture's reach. Recruit on campus. Forge relationships with schools and potential employees. Recruit "retired" workers. Consider using offbeat recruiting techniques. Offer what workers want.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Hiring the Right Employees
Conduct a job analysis and create practical job descriptions and job specifications.
Job analysis process by which a new venture determines the duties and nature of the jobs to be filled (job description) and the skills and experience required of the people who are to fill them (job specification). Job description - a written statement of the duties, responsibilities, reporting relationships, working conditions, and materials and equipment used in a job. Job specification - written statement of the qualifications and characteristics needed for a job, stated in such terms as education, skills, and experience.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Hiring the Right Employees
Plan an effective interview.
Develop a series of core questions and ask them of every job candidate. Ask open-ended questions rather than those calling for "yes or no" answers. Create hypothetical situations candidates would encounter on the job and ask how they would handle them. Probe for specific examples in the candidate's work history that demonstrate the necessary traits and characteristics. Ask candidates to describe a recent success and a recent failure and how they dealt with them. Arrange a "non-interview" setting in which to observe the candidate.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Interview Questions
Job Task
Generate new leads and close new sales
Trait or Characteristic
Outgoing, persuasive, do friendly
Question
How you persuade reluctant prospects to buy? Can you give an example? What would you say to a fellow salesperson who was getting more than her share of rejections and was having difficulty getting appointments? How do you feel when someone questions the truth of what you say? Can you give an example of successfully overcoming this situation?
1.
2.
Linking tasks from a job description to the traits necessary to perform a job successfully. Interview questions for candidates for a sales representative position based on traits.
Analyze customers' needs and recommend proper equipment
Good listener, patient, empathetic
Retain existing customers
Honest, customer oriented, relationship builder
Other questions: If you owned a company, why would you hire yourself? How do you acknowledge the contributions of others in your department?
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Hiring the Right Employees
Conduct the interview.
Break the ice. Goal: to diffuse nervous tension. Ask questions:
Remember the 25/75 Rule. Types of interviews:
Puzzle interview Situational interview Peer-to-peer interview
Keep it legal!
Sell the candidate on the new venture. Best candidates will have other job offers. Your job: to convince the best candidates that your new venture is a great place to work.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Hiring the Right Employees
Check References and Conduct a Background Check
Checking an applicant's references is an important part of protecting a new venture against making a "bad hire" Is it really necessary? Yes!! Background Information Services: More than 50% of job seekers lie on their rsums!
Employment Test
Valid test one that measures what it is intended to measure (e.g., aptitude for selling). Reliable test one that measures consistently over time.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Building an Organizational Culture
Company Culture is the distinctive, unwritten, informal code of conduct that governs the behavior, attitudes, relationships, and style of a new venture. "The way we do things around here". In new ventures, culture plays as important a part in gaining a competitive edge as strategy does.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Building an Organizational Culture
Characteristics of Positive Company Culture: Respect for work and life balance. Sense of purpose. Diversity. Integrity. Participative management. Learning environment. Sense of fun.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Communicating New Venture Vision and Values
Managers spend about 80 percent of their time in some form of communication:
30% talking 25% listening 15% reading 10% writing
Many problems in the workplace arise because of poor communication. Active Listening
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Communicating New Venture Vision and Values
Communicating Effectively: Clarify your message before communicating it. Use face-to-face communication whenever possible. Be empathetic. Match your message to your audience. Be organized. Encourage feedback. Tell the truth. Don't be afraid to tell employees about the new venture, its performance, and the forces that affect it.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Motivating Employees
Empowerment
Involves giving workers at every level of the organization the power, the freedom, and the responsibility to control their own work, to make decisions, and to take action to meet the new venture's objectives.
Job design Rewards and compensation Feedback
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Motivating Employees
Job Design Strategies: Job simplification - breaks work down into its simplest form and standardizes each task. Job enlargement (horizontal job loading) - adds more tasks to a job to broaden its scope. Job rotation - cross-trains employees so they can move from one job in a new venture to others, giving them a greater number and variety of tasks to perform. Job enrichment (vertical job loading) - builds motivators into a job by increasing the planning, decision making, organizing and controlling functions (which traditionally were managerial tasks).
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Motivating Employees
Job Design Strategies : Flextime - an arrangement under which employees build their work schedules around a set of "core hours" - such as 11 a.m. to 2 p.m. - but have flexibility about when they start and stop work. Job sharing - a work arrangement in which two or more people share a single full-time job. Flexplace - a work arrangement in which employees work at a place other than the traditional office, such as a satellite branch closer to their homes or, in some cases, at home. Telecommuting - an arrangement in which employees who work from their homes use modern communications equipment to hook up to their workplaces.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Motivating Employees
Rewards and Compensation: The key to using rewards to motivate employees is tailoring them to the needs and characteristics of individual employees. Money is an effective motivator up to a point.
Pay-for-performance systems
Intangible rewards such as praise, recognition, celebrations, and others can be very powerful, yet inexpensive, motivators. Ideal for new ventures.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University
Homework
Read Chapter 15: Growing Ventures: The Future.
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Dr. Michael Merz Department of Marketing & Decision Sciences College of Business, San Jose State University