[Loudcloud] How to Keep Employees From Hating Their Boss...

Adam Rifkin adam@xent.com
Sun, 6 Jan 2002 16:21:31 -0800 (PST)

F. Scott Fitzgerald once said, "The test of a first-rate intelligence is
the ability to hold two opposed ideas in mind at the same time and still
retain the ability to function.  One should, for example, be able to see
that things are hopeless and yet be determined to make them otherwise."

Said 1 Thessalonians 5:21, "Test everything: retain what is good."

Life takes its toll, so we better bring change...
  -- Adam


Retaining Employees

It isn't all about the money. This may be obvious, but when employees
leave, most managers offer them more money. Why? Because it is the
easiest fix, or at least they think it is. In today's fast-paced
technology companies, compensation is important, but employees leave for
a variety of reasons. Understanding these reasons can give you great
insight into your group's dynamics and fundamentally help build a great
company. Employee retention has to be a top priority for management, all
the way up to the CEO.

Setting Up the Right Environment 

The first question to ask yourself is: "why do employees quit?"
Extensive studies of exit interviews show that most employees quit for
one of two reasons: 1) they hate their manager; 2) they are no longer
learning anything and are unchallenged. Addressing these issues from the
start will set up an environment where employee retention -- even in
this market -- can be 90% or higher.

How to Keep Employees From Hating Their Boss

Step1: Teach your managers to manage 

Most employees who hate their manager, hate them because they do little
or nothing to develop or motivate the employee. Managers often perform
poorly because they are completely untrained.

It's really, really hard to invest in something strategic but not urgent
like training your managers, but remember it's one of two things that
you can do to improve long-term retention.

Developing the right managers begins with the interview process. It is
important to hire people into positions they can handle and to make sure
that managers actually want to be managers. Once a manager is in place,
training is a necessity. Each manager has a different style and some gel
better with a company's environment than others. It is essential to help
managers grapple with the environmental issues and continue to help them
develop. Regularly scheduled sessions on topics like management basics,
selling a new hire on the company, negotiating compensation, building a
killer team, re-selling employees and reviewing and rewarding employees
will dramatically improve management skills. Find the right people on
your executive team to lead these sessions and managers will attend the
same class every few months to get something new out of it.

Step2: Make sure that they learned something

Now that the right set of people are managers who are learning and
developing, it is essential to track their progress. When you review
managers, it is extremely important that you spend time with their
employees. It is very difficult to evaluate management quality from
above; you must look below. When talking to an employee about her
manager be sure to ask thought provoking questions such as: "if I were
to promote your manager to the next level tomorrow, what would your
objections be?"

Avoiding the My-Job-Is-Boring Syndrome

Growing Employees

You can't promote employees or give them more responsibility if they
aren't ready, but you also can't leave someone to boredom. Attack the
problem at the root -- assess employees' skill sets in the interview
process and then carefully define a job in which they can
succeed. Giving employees more responsibility than they can possibly
handle is setting them up for failure. At the same time "Dream no small
dreams for these have no power to move the hearts of men" (Johann
Wolfgang Von Goethe) -- set employees up to push themselves to
succeed. Be sure to communicate the vision of the company and how the
job fits into the vision. If employees understand how they impact the
company's success they are much less likely to feel like they can't make
a difference.

Once in well-defined jobs, it is much easier to evaluate employees'
performance. Communicate often and always; always listen and seek to
understand what is enabling an employee to do great or what is
inhibiting an employee from doing great. Frequent formal reviews are a
necessity. Having a good understanding of what is going on in an
employee's head will dramatically improve your ability to enable them to

Now that you have identified the employees who are bored, doing great or
need help, it is crucial to act on your findings. In today's
environment, only meritocracies will survive. When employees are ready
for more responsibility or another job, move them -- period. When they
have too much responsibility, eliminate some of their tasks so they can

Ongoing Learning

Learning is one of the most crucial attributes of a job. Most people
enjoy learning and like a little challenge. Setting up an environment
where all employees are encouraged to learn and help others is key. Part
of the upward feedback process should be an evaluation of what employees
have learned from their managers. A great employee who can teach 10
people everything that makes them great is ten times more valuable than
an employee who is simply great. This attitude must start with the CEO.

When teaching and learning become part of the culture, immature raw
talent develops into the backbone of the company. People are excited
about their jobs and feel like they are getting a valuable experience --
not just earning a living.

Regularly scheduled classes where employees who are experts in different
areas share ideas with their co-workers can jumpstart the teaching
environment. Giving incentives to employees who go out of their way to
teach, and hiring enthusiastic people also fuel the environment.

When Someone Says She's Out 

Despite your best efforts, extenuating circumstances will always make
some people leave. No matter the reason or "rank" of the employee, it is
important to understand their reasons for leaving. As soon as employees
tell you they're leaving or you hear that they might be considering it,
stop what you are doing and sit down to listen.

Understand their thought processes and the conclusions they have
reached. Listen to the complete story, as there will undoubtedly be
points of interest to you. Next, address their concerns. Be open-minded
and admit flaws where there are flaws. Explain things that are being
done to help address the issues. If an employee is leaving for a bigger
job, seriously evaluate whether that person is ready for a bigger
job. If you think they are, offer them a promotion and ask them to stay;
if you don't think they're ready, explain your reasoning.

Finally, apply what you've learned. Chances are other employees have the
same concerns and will appreciate your efforts. One of the biggest
problems today is the sinking ship phenomenon -- at first, a few
employees trickle out and then the floodgates open and people pour
out. Quickly fixing problems will keep the ship afloat. Fundamentally,
high employee retention is part of a great company.

About the Authors 

Deb Casados is currently Vice President of Human Resources at Loudcloud,
Inc. She has more than 10 years of human resource experience at some of
Silicon Valley's most dynamic and fast moving companies including
Netscape Communications Corp., Novell, Inc., Apple Computer Inc., and
Silicon Graphics, Inc.

Ben Horowitz is currently Chief Executive Officer and Co-founder of
Loudcloud, Inc. Previously, he ran several product divisions at Netscape
Communications where he was recognized numerous times for his results
oriented management style.


As a woman told a man at a party in a 1991 New Yorker cartoon, "I don't
know anybody here but the hostess -- and, of course, in a deeper
sense, myself."
  -- Maureen Dowd, http://www.nytimes.com/2002/01/06/opinion/06DOWD.html