The organization drifts toward average in our system

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the company’s work force will nicely (and disastrously) mirror the quality of the available labor pool. The organization drifts toward average. In our system, managers have only themselves to blame if they can’t fill open slots. After eight years, we have a good feel for the employment “hit rate.” It takes ten prescreen telephone interviews to find one person good enough to qualify for the formal evaluation process. We make offers to about 25% of the people who go through our evaluation, and about 85% of the people to whom we make offers accept. If our managers do their math, they quickly understand that quality hiring takes a lot of work. They’ll need to make about 100 telephone calls to find two great people. By the way, if they don’t fill their open slots by the end of the quarter, they lose the hiring requisition and have to justify the new position again. Another weakness with most companies’ passive approach to hiring is that executives lose touch with the job market. Regular interaction with the job market provides insights on marketplace dynamics. A few years ago, in a memo explaining our hiring system to a new top manager, I wrote down what I had learned as a result of my own job-related calls and interviews. For example, people didn’t like Intel’s 8 a.m. sign-in policy, which the company has since eliminated. Intel and National Semiconductor were paying 15% premiums to layout designers on the night shift while Cypress paid none. But most layout designers cared less about shift differentials than about the kinds of chips they were designing. The market value of plasma engineers ranged from $20,000 a year to $50,000 a year, with little variation of price with quality. The list could have gone on for several pages. We have a second inviolate principle of hiring: We don’t buy employees. This is uncommon in Silicon Valley, but it serves as an excellent screen. Someone who will join Cypress for a few percentage points more in salary or a better dental plan is not the kind of career-oriented person we want. Good people No Excuses Management 6 of 28 6/14/2018, 2:27 AM
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You can’t hire quality people without a systematic approach to interviewing. Four basic rules guide our interview and evaluation process. 1. Use the big guns. If you want job prospects to know that you are serious, high-ranking executives should take the time to get involved in the interview process. At Cypress, all candidates for exempt positions, whether or not they are senior enough to want to be paid fairly, in a way that reflects the organization’s success over the long term. They are rarely concerned with earning an excessive amount of money relative to their peers. What drives them is the desire to win. Until 1986, therefore, we had a very simple policy: A candidate who had received a raise from a previous employer within the last four months came to Cypress without a raise. We now offer an 8% prorated increase, but the basic premise holds. We do not bid for great talent; people with great talent come to Cypress because they want to win. Members of our team are rewarded with stock options and the highest percentage raises in the industry. Everyone at the
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  • Spring '12
  • DirkJenter
  • Finance, Management, vice president, Vice President of the United States, Excuses Management

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