By Fay Hansen
Mar. 23, 2010
Planned Cos. is hiring. The real estate services company, based in Parsippany, New Jersey, employs 1,688 workers at 330 residential and commercial properties spread throughout New Jersey, New York, Connecticut, Pennsylvania, Maryland, Virginia and Washington, D.C.
This year the company will recruit 300 new janitors, maintenance workers, concierges, doormen and security guards, with pay for janitors and concierges starting at $10 to $14 per hour.
In a high-turnover industry such as this, CEO Robert Francis wants employees who will stay on the job.
“Our clients want relationships,” he notes. “They want to see the same doorman every morning, year after year. They want to know their concierge.”
With turnover topping 100 percent at some building services companies, Francis designed a hiring process to minimize employee turnover and keep client retention rates high. Planned Cos. now sports a notable 95 percent client retention rate.
Francis is thoroughly committed to the hire-for-attitude, train-for-skills approach to candidate selection made famous by such companies as Southwest Airlines and Nordstrom. One make-or-break element in the hiring process at Planned Cos. is an attitude test that Francis created and now re-evaluates on a monthly basis.
“My goal is to have lifetime associates who care about the career they have chosen,” Francis says. “We promote from within. Doormen can go to their regional manager and ask for opportunities. One of our executive vice presidents was cleaning banks on the night shift when he was 16 years old. Some of my executives don’t have a college degree. We do not require job applicants to have a high school degree. I require the attitude degree.”
Testing the test
Francis believes that the hire-for-attitude approach has minimized turnover and helped the company achieve the consistency that keeps client retention rates high.
“Our turnover rate is 20 percent, which is spectacular for our industry,” he says.
For frontline and field employees, all recruiting is handled in house by one full-time recruiter working with the management team, operations managers and human resources. Staffing agencies handle headquarters positions that require specific skills and senior management and executive positions.
The company’s hire-for-attitude methodology is based on Nordstrom’s approach.
“It resonated with me,” Francis says. “You take inherently positive individuals and then provide the necessary training. In our work, employees need to be ‘on’ day in and day out.”
Francis rejected off-the-shelf hire-for-attitude tests.
“Working off of the Nordstrom model, I read a hundred books and then put together a test,” he recalls.
The test he devised, which he calls I PLAN, measures five qualities.
The first is demonstrated integrity, measured through a series of questions about ethical behavior. The second is passion.
“We want to see that they have a passion and have excelled in it,” Francis says. “It could be a hobby or a project where they succeeded.”
The third element—longevity—determines whether the candidate is looking for a job or a career.
“The whole purpose is to deliver consistently good people for clients who don’t want turnover,” Francis notes.
The fourth element measures positive attitude and asks candidates to describe a positive customer service experience. It also asks how the candidate’s friends would describe the candidate’s personal characteristics.
The final element of the test measures the candidate’s knowledge of tasks that are relevant to the job and the company’s mission and role. The recruiter or hiring manager administers the test face to face or by phone.
Francis constantly monitors the hiring results.
“We use a dashboard for all quits and employees fired in the month to analyze what we missed in the test and to understand good and bad hires and revisit their answers on the test,” he says. “There are patterns to responses, so we delve deeper into that.”
On average, for every 15 candidates tested and interviewed, the company hires only one.
“A lot of people talk the talk, but don’t have the attitude we are looking for,” Francis says. “The 14 candidates we don’t hire will go to our competitors, and that’s fine with us. The more selective we are, the better we will be. We never lack for applicants.”
Francis believes that the company’s net promoter score (NPS), which measures customer loyalty, demonstrates the success of hiring process.
“We are in our third year of tracking NPS and we score in the high 40s and low 50s, which is very high,” he says. “We track our NPS by account, by unit and by region, and then we drill down into the people. We’ve modified some of the test questions and hiring practices as a result. We found, for example, that some our people with a military background who took over accounts were too authoritative, so we made adjustments. We also look carefully at client comments.”
Francis believes that the test and the company’s workforce management practices keep turnover well below the industry average.
“There is a misconception about my market,” he says. “It’s not necessarily a transient market. You can find the right individuals, and if they are treated with respect and they have an open line of communication with management, they are likely to stay. My industry misses the whole boat. You have to have a model for how you treat people.”
Planned Cos. does not monitor its test for disparate impact, but Francis believes that it is nondiscriminatory. Still, employers should be cautious about the legal implications of tests that include an honesty or integrity component.
“Whether the focus is on integrity or a test is a broader assessment, employers should seek legal counsel,” says William Floyd, senior partner at Best Best & Krieger in Riverside, California. “A number of legal issues are implicated.”
Massachusetts prohibits employers from using any test used to render an opinion regarding an individual’s honesty. California and Rhode Island limit the use of honesty and integrity testing in making hiring decisions. Other states place some restrictions on honesty testing, but the law is unclear in many cases.
“Tests should be vetted from a privacy standpoint and for state laws on disability that may be more restrictive than federal laws,” Floyd notes. “Employers should always consult counsel to minimize the risks.”
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