Today’s podcast guest is Lee Caraher. Lee is the CEO and Founder of Double Forte, a PR and Digital Marketing Firm. She is also the author of a recent book titled The Boomerang Theory, a concept we will learn about during this episode, which is something that is beneficial to companies of all sizes. This episode is a must-listen for any business owner and employer, as well as employee’s.
Let’s face it, having great people in your company is a true starting point. Lee will help you understand why this is true.
A few important lessons that you will learn from this episode:
- The Boomerang Principle – Giving old employees another chance.
- Employer-Employee respect and what it takes to earn and receive it.
- The importance of Loyalty in the workplace.
- Lee’s experiences and lessons from hiring and re-hiring Boomers and Millennial’s.
Narrator: Welcome to The Sustainable Business Radio Show podcast where you’ll learn not only how to create a sustainable business but you’ll also learn the secrets of creating extraordinary value within your business and your life. In The Sustainable Business, we focus on what it’s going to take for you to take your successful business and make it economically and personally successful.
Your host, Josh Patrick, is going to help us through finding great thought leaders as well as providing insights he’s learned through his 40 years of owning, running, planning and thinking about what it takes to make a successful business sustainable.
Josh: Hey, how are you today? This is Josh Patrick and you’re at The Sustainable Business. Today, my guest is Lee Caraher. She is the CEO and founder of Double Forte. It’s a PR firm and a digital marketing firm. She’s just written a book called The Boomerang Principle. I’m really curious about what the boomerang principle is so instead of me wondering about this, we’ll just bring Lee in and she’ll be able to tell us.
Hey, Lee, how are you today?
Lee: Hi, Josh. So glad to be with you today.
Josh: It’s a pleasure having you here. So Lee, tell me, what is the boomerang principle?
Lee: The boomerang principle is the belief that companies and organizations that allow and encourage their former employees to return to them have a strategic advantage over those that don’t. That’s the boomerang principle.
Josh: Interesting. So I have had former employees return to me over the years and it’s gone well and it’s gone not so well. So what did I screw up with the thing not going so well.
Lee: Well, why did you bring people back who didn’t do so well?
Josh: Well, they were okay employees when they were with us the first time around and they were–
Lee: Okay, I got it.
Lee: You have to stop, I got it.
Lee: Okay employees can’t come back.
Josh: Ah, so that was my mistake.
Lee: Okay employees can’t come back. All companies of all sizes and all ilks are all looking for those best performers. And okay is not enough to return because you wouldn’t intentionally hire an okay person for a job. And you shouldn’t bring back an okay person for a job unless they’ve made dramatic changes in their performance and how they approach their work. The people who come back really have to be really good performers, people you’d want to really have come, you’d want to recruit the first time if they had never been there before. So that’s really the differentiation there, I think.
Josh: Okay, cool. So let me ask you this, why wouldn’t we want to have high performers come back?
Lee: I don’t know. Let me give you some statistics. So, in the United States, until last year, over 50% of the companies in this country had either written policies or oral, in-the-air policies, about not ever bringing somebody back who had left them. And 50%, from the many companies we have in this country, that’s still millions and millions of people. But I think it’s extremely shortsighted. And it becomes even more shortsighted as we think about the changing dynamics in the workplace today and sort of what’s happening with the generations, millennials and the Gen Z coming behind them in terms of how they work, how they want to work and what they’ll do.
So, if we can create companies where people will want to return to, we create companies that people will stay in. And as long as we keep our expectations and our performance high, the number one thing you can do for sustainability is to create an environment that has a culture of return in many different kinds of ways. The biggest way would be to return to be an employee.
But every time someone leaves your company today, they can help you or hurt you. And you should do everything you can to have them help you. And the more you help people help you, after they leave you, the more sustainable your business is because you have people who are not detracting from you out in the world. And while that has always been the case in today’s super social world, it is even more the case today.
But the number one thing is you don’t have a business if people aren’t paying you because you have crappy standards. It doesn’t really matter. You have to have high expectations to make it work.
Josh: So that answers that question. So where does respect fit in to all this?
Lee: Oh, my gosh.
Josh: I mean, I have my opinion about it and I’m curious what yours is.
Lee: Respect is tantamount. It is tantamount. And I think, when I came to this box, after my first book. My first book was Millennials and Management. And I wrote it after we failed miserably at retaining millennials in our company and then how we figured how to do it.
And when I was talking about it, the first question I would get mostly from boomers – and I’m a boomer, was “Oh, these people are dead to me. They come. They take all our snacks. They leave early. Why should I put any time into these people because I know they’re going to leave? They’re job hoppers.” And, of course, I had a visceral reaction. I’m like, “Well, of course, they’re leaving you because you aren’t doing anything for them. Why should they stay?”
Lee: So, respect is a two-way street.
If we go back a few years, there is no reason we should expect people to maintain the old definition of loyalty to a workplace. The old definition of loyalty to the workplace was, “I come. I work. I do my best. I stay and the company takes care of me.” And that really started getting broken in the late-’80s, early-’90s when particularly publicly-traded companies started getting rid of people for shareholder value. And then we see it sort of from the early-’90s to 2008 with the great recession and just sort of the absolute change in what that means.
Today, I think employee loyalty is two things. One is, the most loyal thing an employee can do for you is leave when they’re just [inaudible 00:05:52] it in, is leave when they’re not excited about the opportunity. And the most important thing for businesses today is to create lifetime loyal employees who are loyal to you even when you’re not paying them because actually loyalty is not what you pay somebody – that’s called a transaction. Loyalty is doing something for somebody when they don’t have to and that is the ultimate respect.
So if we can, as companies, respect individuals’ desires for their own careers. And, as individuals, respect our companies and their need to perform and provide a service, and also, what they’ve done for us in terms of being able to learn and, on their time, getting paid for it. That ultimate respect is what is the basis for this boomerang thing. And also, I think, is the basis for sustainability because if you don’t have it, you have a lot of ill will. And ill will is the first thing that kills profit.
Josh: So one of the things that just came to mind and actually has been in my mind for quite a while about this is that loyalty, respect – all this sort of stuff used to be just plain expected if you were an employer. And you would always believe you got it automatically. And in my experience today, what the boomers have missed is that respect and loyalty have to be earned from the employees.
Josh: You can’t expect it to be given just because you’re writing a check.
Lee: I agree. Again, I’m a boomer. And if you watched Madman ever, right? Like, why didn’t you say thank you? Your paycheck is thank you. That is definitely a sentiment, right?
Josh: A lot of my peers still believe that.
Lee: Yeah. Well, that would work, I guess, if companies weren’t just getting rid of people because they had to give shareholder value. I mean, if you think about what’s happening in the American economy, particularly around publicly-traded companies or companies owned by private equity – all that kind of stuff, the priority is the shareholder. The priority is not the people creating that value so why should we believe that?
Josh: Actually, I think the priority is lining the pockets of senior executives. And whatever they need to be doing to get that done, they’re willing to do that and shareholder–
Lee: Which is shareholder value.
Lee: If you’re not delivering the value you can’t get it, right?
Josh: Well, not so much. Shareholder value is an excuse for bad behavior, in my opinion.
Lee: If the market wasn’t rewarding this bad behavior, it would stop. The market’s rewarding bad behavior. The market’s rewarding the fact that our CEOs get paid 3000 or whatever the number. Well, I’ll take it down, 350 times as much as their lowest paid employee. That’s being rewarded by Wall Street. If it wasn’t being rewarded, it would change immediately.
Josh: Make sure we bring this back after our podcast recording and we go back to Facebook Live because this is an interesting topic to talk about.
Josh: But it’s off the point of loyalty in the workplace, so let’s get back to that because I think that’s a really big deal in that what can business owners be doing, specifically privately held businesses. I’m, not especially concerned about public companies. I’m mildly concerned about private equity companies only in the fact that they screw things up and I have some great strategies to take advantage of that but we won’t talk about that either.
So, you’re talking about a culture of return. Now, I assume, when you’re saying culture of return, you mean a culture where people come back to your company?
Lee: Mm-hmm, a culture of return, (1) is a culture that allows people to come back. So you have people who were–
I’ll give you the example of my company.
Lee: My company’s 15 years old. We started it in the downturn, up in San Francisco, after the 2001 implosion. I’ve been through this a couple of times. Anyway, so when somebody leaves us, the first thing we say is, “I hope you come back.” We’re not gnashing our teeth. We’re not out really upset. We might be in really, “Uh, God, I just traded my whole life.”
Lee: But the first thing we say is, “I hope you come back. I hope, when you decide wherever you’re going is not where you want to be, call me and I hope we have a place for you to return to.” I tell everybody the first week they’re here. I meet with everybody even if I haven’t hired them and I say, “I know you don’t have to stay here. I know you’re not going to stay here for the rest of your life. I want this to be the best experience possible for you, whatever stage of career you’re in, and I want you to know that our goal is to have as many people come back as possible.”
They’re like surprised that I’m saying this. Like, “I just started and you’re telling me I’m going to leave?” Right? But, of course, when we hire someone we know they’re going to leave us. It’s very unusual that someone would stay with us until the end of their career unless they’re 60 years old and leaving at 65 or whatever it is, right? Very unusual.
Josh: So Lee, how many employees do you have at your company?
Lee: We have 35 employees right now. We’re small.
Josh: Of course, people are going to leave if they have any ambition at all.
Lee: Well, yeah. We should not assume. Any company of any size, actually, can contain a person throughout their whole career. And particularly with millennials who, I’ll just say, were born between 1980 and 2000. These people, 80 million people believe they’re going to have five to seven careers, not just jobs – careers, like doing physically or really different things.
So imagine that someone you hire at 26, who is on his/her first career could stay with you until they retire, when they will have want to have gone through seven careers is unsustainable. No one company can do those things. Because what if you want to become a yoga instructor? Well, I don’t have yoga instructors here. But I will help you become one. And while you go get your credentials, as long as you work hard while you’re here, you can stay and we’ll figure out your schedule so you can get your credentials because they’re out in the world saying good things, right? That’s what I want.
Lee: I want as large, a fabulous alumni program – people as I can get. And so, in my company with 35 people, 15 years old, we have re-hired 14 people and we have re-hired four people twice.
Lee: And only three people are not boomerang eligible. But, you know, don’t stay forever, right? And I help– I, the company– if someone wants to get– we tell them this too, first week, “You’re going to come to a time when maybe you don’t want to be here. Well, first of all, I hope it’s not because you don’t think there’s opportunity here that you can’t get.”
So first, be very open. Like, what do you want to accomplish? We’re going to help you accomplish whatever we can in the confines of our company. But if you can’t do that, we can figure out how to help you go do what you want to do.” And probably 50% of the people take me up on it – or take the company up on it. And we do. We make phone calls. We write recommendation letters, if they want to go to school.
And then what we have, we have all these people in a closed alumni group, its own networking thing that are recruiting for us, who are bringing us business, who are bringing us partners. And the cost of acquisition for anything that an alumni person brings to us is so infinitesimal to the cost of creating those opportunities ourselves. That is the boomerang effect. The sustainability around that is amazing.
And every company can do that. Every single company can have an alumni program that they administer themselves. Not like sort of Rogue on LinkedIn but that they administer, that keeps people connected to them over time, that helps them help you.
Josh: So this thought just occurred to me, if you only have three people who are not boomerang eligible, that must mean you have a pretty darn successful hiring track record.
Lee: We do.
Josh: So that means, to me, that you must have a hiring system which you’ve highly vetted and produces extraordinary results for you.
Lee: It did at the beginning of our company. And it does now. But in the middle– so 2008, we changed our model and our model was, when we started, “Only hiring people who had 10 years of experience and above.” In 2008, when everything went to hell in a handbasket, I think it’s important, every time there’s economic impact in your business, so it could be you lost your biggest client, it could be that five people left, it could be that you haven’t won the last five bids. It could be that the economy just tanked. It could be that California fires are going to mean that there’s no wine next year. I mean, I don’t know, whatever it means.
But every time there’s an economic impact, you have to look at your business model because the business model you had going into that event is likely not the business model you should have coming out of that event. So we did that, in 2008 – 2009, and we realized that only hiring people with 10 years of experience was going to be a recipe for death so we started hiring recent graduates which I had done in my previous career.
The last two jobs I had before I started this company, I had 600 people and 750 people. I mean, I had a lot of people.
Josh: That’s a lot.
Lee: I didn’t think anything of it. I was like, “This is easy. I’ve done this before. Hired millennials.”
Oh, my gosh. Josh, in my company, we hired six millennials. So, again, we have a 35– at that time, I think it was 32, maybe 35, somewhere in there. Six millennials within eight weeks of each other. And within three months, they were all gone, 100% failure in retaining people. I had never, in my career, had a 100% failure in people. And one person could be a bad hire because we all make bad hires, right?
Lee: One person could be a bad hire but six people, that could not be bad hires. That had to be us. And that’s when I started understanding the vagaries and the differences in the millennial population than the GenX and the Boomer population that I had in company. It was quite a revelation. My first book came out of that. Since then–
I’ll just give you some numbers there. So in San Francisco where my company is based, at that time 2011 – 2012, the average tenure for a millennial at that time, under 28, was 13 months. So expensive. And I’m not talking about baristas which is what you would expect, a yearly turnover, you know? I’m talking about white collar jobs.
Lee: White collar jobs. Thirteen months, so–
I mean, oh my gosh. And I said, “Okay, if we can just double that, if we can get them to two years, we have cracked some code and we’re beating our competitors. And in the service business, you always want to have great people with you longer, right?
Lee: Today so now, years after that. I mean, I guess, four years after we figured it out, the average tenure with someone under 30 in our of company is four years and a quarter. So we’re doing something right. But it’s a lot of work and it’s really messy. And sort of when we embraced the mess, we get much better performance from our people and we get much better performance in our business around that.
But again, back to the beginning, if you don’t high expectations, if you don’t have very high work standards, it doesn’t matter because no one’s going to hire you if you are putting up draperies or if you’re doing their PR unless you have a great standard.
Josh: That makes sense. So what do you do to make sure you get the right people in the door in the first place?
Lee: So we do a few things. One (1) is we recruit to our values, not necessarily to our skill sets. So we measure our skill sets and we can teach. If you can write a paragraph, that’s the first. We can teach a lot.
Lee: In our world, we have to teach writing and communication skills and all that kind of stuff. So we assume people know nothing except they need to be able to write a paragraph which, unfortunately, is a dying art. At our very entry level, we test for that.
Then, we recruit against our values. So, our values are things that we actually re-did a few years ago. And in my book, The Boomerang Principle, I talk about this, how important this is. And I actually share our values in this book.
So there are three kinds of values. There are permission to play values which is the bottom line of values. For us, if you’re not a team player, you’re not coming here.
Josh: So you’re a fan of Patrick Lencioni?
Lee: I love Patrick Lencioni. Love him. The Advantage is a book that any CEO, any entrepreneur, any leader of a team should read.
Josh: As a matter of fact, it plays a major role in my book I just finished.
So our permission to play is around teamwork and about being good people. It doesn’t throw somebody out of the bus. And we can test all that stuff. We can ferret all that stuff out.
Lee: Our aspirational values are around– we want to be fiercely courageous. And we want to be the Seal Team Six of our industry. And this is a thing that our group came up with. I mean, I didn’t really actually participate in this in terms of generating the values.
So we recruit against the values and then we reinforce them all the time. You have to say them over– and it can’t just sit in a wall, right? It can’t just sit in a wall.
Lee: And they also can’t just be one word, right? They have to be accompanied by behaviors that you expect, that demonstrate that you’re on the team. So we spend a lot of time on that. So that’s how we recruit.
And then, in terms of a retaining people, we do dedicate a lot of time to people in terms of one-on-one meetings and incorporating our work with their goals, and how do we help the company achieve its goals and its work, and also help people achieve their goals for their own careers. And that also is very messy. You could have someone who just graduated from college and – so, tell me, Josh, where do you see yourself in a year? Well, I see myself in a year as the vice-president. And after you try not to laugh, you now feel like really talk with that person about– let’s talk about what’s realistic and what that means. So it’s not impossible.
Lee: Not impossible.
Lee: Highly unlikely because these are all of the things you have to learn and be able to master, not just one undone but master before you can do that.
Lee: And it’s a messy conversation but people are messy. And I think one of the biggest problems for, particularly big companies and process, is that they’re “check the box” and humans aren’t boxes. It’s very challenging to check them. So if you hold the values, then you can hold to it.
Josh: So that would move us into a conversation on behavioral economics.
Josh: And unfortunately, we don’t have time for that right now because we are out of time so, Lee–
Lee: Oh, I had very, very long answers. I’m sorry, Josh.
Josh: No. No, no, no. This is great.
Actually, this is one of my favorite episodes because I think that what you have brought to the table today is more than enough to chew on to keep somebody busy for well over a year.
Lee: Well, sorry.
Josh: Well, no reason to apologize.
So, Lee, how would people find you and how would they find your book and all that kind of good stuff?
Lee: Absolutely. The best place to go is my website LeeCaraher.com. L-E-E-C-A-R-A-H-E-R.com. And you can find my books. You can find my agency. You can find my blog and my podcast there which I talk about all the stuff all the time. And Facebook, since we’re here, is LeeCaraher1 and you can join me there. And I share a lot of these things and downloadables and tools that you can use as well.
Lee: I’ll just show you what the book looks like, since I’m here. That’s what it looks like.
Lee: You can get it on Amazon. You can get it at Barnes&Noble. You can get it in independent book stores all over the country.
Josh: Sounds great.
I also have an offer for you. I have put together a one-hour free audio CD course. It’s called Success to Sustainability: The Five Things You Need to Do to Create a Personally and Economically Sustainable Business. It’s really easy to get. And you don’t do this if you’re driving. But, when you stop driving, you take out your smartphone and you text the word SUSTAINABLE to 44222. That’s the word SUSTAINABLE to 44222. You’ll get a link. You’ll give me your name and your address and we mail it to you.
Now, if you happen to have one of those newfangled cars that doesn’t have a CD player, just send me an email at email@example.com. That’s the letter J, Jpatrick@askjoshpatrick.com, and ask for the file and I’ll send you the audio file so you can listen to it. You don’t get to see my beautiful face but you can still listen.
We’re out of time so I want to thank you a lot for stopping by today. This was a great episode. I’m really looking forward to when it appears.
This is Josh Patrick. You’re at The Sustainable Business. I hope to see you back here really soon.
Narrator: You’ve been listening to The Sustainable Business podcast where we ask the question, “What would it take for your business to still be around 100 years from now?” If you like what you’ve heard and want more information, please contact Josh Patrick at 802‑846‑1264 ext 2, or visit us on our website at www.askjoshpatrick.com, or you can send Josh an e-mail at firstname.lastname@example.org.
Thanks for listening. We hope to see you at The Sustainable Business in the near future.