Arecession can have its bright spots. Given the layoffs, closures, pay freezes and deferred bonuses, now is a good time to attract high performers who may be unhappy in their current positions or suddenly find themselves in the unemployment line because of cutbacks, says Brad Smart, a management psychologist, consultant and author of “Topgrading: How Leading Companies Win at Hiring.” Smart, president of Wadsworth, Ill.-based Smart & Associates Inc., which advises Fortune 500 companies on human resources practices, including selection and hiring, says a down economy can be a good time to upgrade the quality of one’s employees.
Won’t top talent want top salaries? What happens if a company can’t afford to pay top dollar?
Yes, top talent wants top salaries and should get them. Restaurant managers can have a base salary that is average, with a high bonus paid for super performance. You don’t mind paying when people earn it. In this down economy, companies are “topgrading” the tough but smart way: They let go of two or three C players to hire a superior person at a higher than usual salary. Although in a down economy companies can sometimes hire great people on the cheap. Don’t do it. They will be the first to leave when the economy gets better.
With unemployment up, and so many more candidates to choose from, can’t companies take their time in hiring?
Companies can get away with it as long as the economy stays weak. But I’ve seen a lot of companies regret taking their time because usually an economy bounces back quickly, and guess who are the very first people to be snapped up—A players! So, “topgraders” push hard and fast to get the very best talent available for what they can pay.
In your 35 years of experience, have you ever seen the economy decline so rapidly, and do you think the turnaround will be quick?
I’ve never seen the economy tank so quickly and with such global thrust. I’m sorry to say I misjudged this one. I thought the recovery would occur by now. I’m still an optimist. I’m betting on a 2009 recovery because the world is working toward it. Fantastic companies have pared down but are poised to recover, new markets [health care, energy] are popping, and most of all, the resourcefulness of A players is still strong not just in the U.S. but all over the world.