Lou Adler is the CEO and founder of Performance-based Hiring Learning Systems. He is the author of the Amazon top 10 bestseller, Hire With Your Head, The Essential Guide for Hiring & Getting Hired. On this episode, he shares how he landed in the human capital industry, why he thinks there’s nothing more important than hiring, and what he means when he says you ought to hire people who are “different”. As a bonus, he explains what he means when he says his leadership style is “crappy” and what he’s done about it.
I’m going to kick us off with your first role, which was in missile guidance control system design, I read that within 18 months, you had moved up and were working directly with the head of the department. Can you take me back to that period of your life? What allowed you to grow so quickly and honestly, how do you go from missile guidance control systems to a best-selling author in the realm of hiring?
That was actually my second job. My first job was definitely missile guidance and control systems, working on a Minuteman missile. It was too far away from my girlfriend, so I moved closer to another company and I also got my MBA in parallel. That was actually my second job since I was getting my MBA and I also had an engineering degree and I actually was working on guidance systems for missiles, both short-range missiles, and ones that intercontinental ballistic ones. I just happened to be sitting next to the guy who was in charge of budgets for this department, that I worked for. I was an engineer, but sitting next to him. I told him, I think his name was Phil, I haven’t thought of that. I said, “Phil, that’s not the way you would actually do the budget for this, this is the way you would do it.”
He looked at me, and he said, “You’ve got to talk to my boss.” We came up with this whole new technique for budgeting and he said, “I need to hire you to do our contracts and negotiation.” I mean, literally, it was a pure fluke, when I was taking a course in statistics, getting my MBA, because I didn’t even have it at the time. I just did some statistical process control or statistical analysis to demonstrate that when you’re doing a budget for a complex product, you could use statistics to figure it out.
Quite frankly, that’s how it happened. I know it’s weird. He said, “You’ve got to handle all of these budgets.” Turned out I actually like that better than missile guidance control systems, but from a practical standpoint, there was a lot of analytics involved in it and it made good sense. As a result of that, they put me on an MBA fellowship with the company and that allowed me to meet a lot of corporate executives. Fundamentally, that was it.
I did real well on my MBA program and that got me an opportunity to meet other corporate executives and they said, “Hey, you’re a pretty good guy, you’re doing this stuff,” and so on and so forth. That was really how I got into a pretty rapid growth, pretty quickly. Kind of fluked into it, but nonetheless, it was worthy.
I definitely want to talk about when you think back to your career progression, almost though, what would you tell your younger self or why do you think you’ve been successful, but I also want to talk about the work that you do, and specifically, bringing new people on to our teams, hiring, cultivating that talent. Are there certain questions that you think that current leaders should be asking both themselves, maybe their colleagues, and then also the people that they’re considering? What are the questions that should be in our head when we’re thinking about bringing new talent onto our team?
That’s a pretty in-depth question and very important one. I’ve got to go back many, many years. As a result of all these promotions, I had an opportunity to become a senior financial analyst at the headquarters of a Fortune 50 Company. Just after I got my MBA and six months later, they asked me to be head of capital budgeting for a big automotive operation in Michigan area.
I had a boss who got me into the recruiting side and said, “Hey, we’ve got a hiring, it’s pretty critical. We’ve got to go out to the University of Michigan and hire some MBA.” I had to be 25 or 26. I learned early on, while I was in financial management capital budgeting, I understood the need to hire great people. I don’t think I did real well at first, but we clearly look for people who are different, who were proactive, who decided to invest in themselves, who decided that they weren’t going to be like everybody else, they just did, I don’t want to say weird stuff, but unusual things. They volunteered for projects whether it was inside or outside a company, they were part of teams, they took leadership roles, even if they were not logical leadership roles, but they gave them an opportunity to really reach out and be involved with a different set of people, different kinds of community.
Even if it was a technical person, we looked for people who could collaborate with non-technical people, or work with executives or work in different functions. I’ve had to give the key is if I was giving advice to someone interviewing college students, that’s what I would look for is people who have really gone the extra mile doing other stuff. I probably do the same thing with, we helped a company a couple of years ago to hire 200 sales reps, and we did pretty much the same thing. We wanted people who did different things, and we asked candidates, “Hey, tell me about your biggest accomplishments, whether it’s work, school extracurricular clubs.”
We asked a lot of questions, but we look for a pattern of person proactively helped him or herself to become better at what they were doing, particularly, not only in the technical side, but also on the team side. In a nutshell, that’s what I would say is the key.
A statistic that shows up in your LinkedIn profile that popped out to me, it said that more than 40,000 recruiters and hiring managers have attended one of your groundbreaking workshops focused on this and other things, that you do in those workshops. When you think about going on stage or presenting, and the thousands of people that have interacted, what are you doing to prepare for those types of events? What’s your routine? How do you get ready to make sure that everybody who goes through that actually gets value out of it?
There’s a lot of things there to it. Let me give you the first thing, I was never a very good public speaker, probably I still aren’t’ today. The first real big talk I gave, real big to 2,000 people, I was scared, literally scared. I talked to my son who was going to film school at the time, and I, “Hey kid, I need help.” He just said, “Visualize the situation, and start asking questions to the audience. It puts the pressure on the audience, rather than the pressure on the speaker.” At one level, that’s what I did. It took the pressure away, but to get ready to do that, I had to really know my stuff. I really did practice. I, obviously, put the slide decks together, whether I used them or not. I tell lots of stories and I do practice. practice, practice.
I also when I get up on the stage, I start asking questions, whatever it may be. I say, “Hey, how many of you have this problem? Describe it to me.” Then, obviously, I ask those questions as they relate to the topic of a conversation. When I’m pretty comfortable with, at least, the first 10 years I wasn’t, but by knowing all this stuff and having ready answers to the logical questions, I could pitch the talk to what I wanted to talk about. I guess that might be some level of insight there, but I’m not sure that it is appropriate for what you’re asking.
You definitely had the luxury and the pleasure of working with some high ranking officials at very powerful organizations. When you think about some of the traits that have impressed you over the years, for people who have ascended, what are some of those traits that pop out that maybe were noticeable in multiple people and it definitely felt like there was a trend?
Let me go back to my early job that I said because I think this will be relevant. Being an engineer, and trying to be a perfectionist, you tend to overdo it. I had this one project, just after I got my MBAs, we’re talking, I guess, 50 years ago. A long time ago. I was doing a capital budgeting analysis for a major annual operating plan for a huge division, a couple of billion-dollar division. That was probably equivalent to 5 to 10 billion today. I had the full responsibility to look at the corporation’s budget.
I had this report, and I was so proud of the work I had done. I probably worked two months without taking a day off, 12-hour days, and very, very proud of the work. I was finally going to meet the CFO and present my results. I had never met him before, the CFO of the 37th largest company in the United States and I was nervous. So 2:00 in afternoon or 3:00 in the afternoon, my boss comes in, says, “Let me see your report.” He really didn’t check in on me, other than a couple of weeks earlier and said, “You’re doing the right stuff.”
He looked at the report 70-80 pages thick, typewritten paper, didn’t have a comment. It was typewritten, he said, “This is a piece of junk.” He said, “You can’t present this to the CFO tomorrow,” and I said, “Oh God. This is my whole career was just about to fall apart.” He looked at it, he said, “I want you to write a two-page report, two-page report that summarizes this.” He said, “Do it like this,” he just give me the outline. He said, “I’ve asked two of the secretaries to stay late tonight, so you could rewrite it, and they’ll stay as late as you need.” This is from two o’clock to like nine o’clock, I’m redoing it. The secretaries were there, literally, they go there and I put this two-page report together.
My boss Chuck came in at probably 7:00 or 8:00 in the morning, looked at it, fine-tuned it and he said, “We’re good to go.”
I met the CFO and now I’m getting to the story, but it’s a worthy story. I meet the CFO and he looked at Chuck, who’s my boss and looked at me and he said, “Okay, we’ve got this division, two million dollar division, and they’ve got to bring in 150 million dollars of pre-tax profit. What’s in their budget?” I said, “120 million, sir,” and he said, “Well, we’ve got to get 30 million out of that. Is there 30 million in this budget?” I said, “I think they’re sandbagging and 50 billion or 50 million.” CFO looked at me and said, “Are you sure?” I looked back and I said “I’m absolutely sure.”
CFO at that moment called the group president and said, “My man, Adler, says you’re sandbagging your budget by 50 million dollars. I want 30 million of it back and your commitment to your budget by Friday,” hang up. CFO said, “Excellent job, Adler.” This took no more than seven minutes. The lesson learned though, was the value that you have to take and distill everything you have into one or two pages or two to three minutes, so some executive can take that information and run with it. Invaluable lesson. I see it every day today. I still sometimes overdo it, I see it in technical people all the time, is you got to take all your information, put it together in some summary, for some senior executive can act upon it. If you can, you have to talk that way, you have to write that way, you have to communicate that way. To me, that’s the key to dealing with other departments and other people.
If you want to convince somebody, you have to be confident in what you’re doing because you’ve got to be able to summarize it into and I don’t want to say a twee, but let’s call it a long tweet, but maybe it’s one or two paragraphs or one or two pages, at most.
The landscape has changed much as things in move towards, remote work or hybrid work, how do you think that’s going to affect corporations from a hiring perspective or how are you guiding people or advising people to think about potentially less geographic restrictions to bringing people on to their team?
I think it really opens the pool to a lot more people. I talked to a woman who’s a VP marketing, and she lived in Southern California and she was working with a company in New York City. I can’t remember her name, I think it was Mary. I said, “Mary, how did you get this job?” She had a remarkable background, without question. She said, “Well, I know the CEO. He’s been trying to hire me for two years, but because of remote work, I finally could take the job. I have two children, I wasn’t about to move to New York City, but I can certainly do it remotely.”Once COVID is over, we’ll be spending two or three days a month on site, but for now, I can get just as much work done as I can remotely.” I’ve seen that same concept is people are learning how to manage remotely, hire remotely and get things done remotely.
I think it’s actually going to be the positive thing, it’s going to offer a lot of flexibility to a lot of people. On the negative side, I think it’s going to cause people to be easily persuaded. I think we’ve made job changing too transactional and too superficial. The negative is people are going to leave jobs for pay and for short term reasons, which I think is a real negative of a lot of stuff we do. On the positive side, I think working can be done remotely and just as easily. I’ve talked to some people who do in scrims and agile software, and they seem to be able to handle it properly. Obviously, if you have a timezone difference, you kind of have to be there at local time in the morning or whatever day, but nonetheless, I think it’s going to be profound change.
One question that we get from a lot of listeners that I always like to ask is about curiosity. What are you the most curious about right now and it can be on a topic that we’ve talked about, or it can be something completely unrelated. What are you most curious about right now?
Sadly, I am and you’ll see it’s totally unrelated, but it’s my engineering background and financial background. The SEC has just made an announcement that human capital has to be quantified to some degree. Since my background has been in financial analysis engineering and now of human capital, it seems like you can relate cost per sales, revenue per employee, variable profit per employee, the cost of hiring a top third in the ROI, versus hiring the bottom third. I love that stuff if I could retire, because I am 74, retire now and just work on that, that would be something I am very curious about and I’m reaching out partners at public accounting firms to once I get this fourth additional hire with your head done, I am going to probably focus on how do you quantify human capital in some measurable financial way.
That is a wonderful spot to shift to our final two rapid-fire questions that I get to ask all of our guests. Question number one is this, if you could describe your leadership style in just one word, what would that word be?
Crappy. I’m a crappy leader. I know. that’s the word I have to use, I’m not very good at it. I have no patience, I expect people to deliver, so I’ve learned that I delegate a lot and I tell people, “I’ll give you a little bit of coaching, but you’re on your own.” It’s not a good leadership style.
I do try to create a vision on the other hand, a puzzle, so I create a vision of where we’re going and the point of it, but then I expect people to take the initiative and achieve it themselves without a lot of direction.
A final rapid-fire question is this, what is the best piece of advice that you have ever received?
It goes back to the story I said earlier with my boss, the same guy who told me, “You’ve got to summarize this thing in two pages.” I was working in Michigan, just got there, another big report that we had to present to the executive team on how are we going to do the capital budgeting system and implement it. My boss, Chuck, calls me and says, “Lou, you’ve got to go to the University of Michigan. We’ve got 20 candidates to interview and I only have slots for seven, so you’ve got to take up the other nine.” I said, “I can’t do it, Chuck. I get this report out tomorrow, so I can’t get there.”
He said, “You actually have to be here, there’s nothing more important than hiring. Get your butt over here, we’ll figure out how to get the report done.”
That was the message. There is nothing more important than hiring great people. Everything else can wait. If I had that to say that lesson I’ve heard and it’s absolutely true.
A lot of managers give it lip service, companies give it lip service, but it’s absolutely true. Managers spend too much time making short-term decisions to hire people and then spend too much time after the hiring, trying to get a below-average person become average. You hired great people, you’re building a great team and your life will be heck a lot better, so that’s the advice. There’s nothing more important than hiring great people, nothing.