Are HR's diversity and inclusion strategies proprietary information?

Companies suing each other after an employee leaves one company to join another, especially when the companies are competitors, over the details in the employee's non-compete agreement is not all that uncommon. Particularly in the tech industry when many rival companies are chasing many of the same kinds of tech-driven breakthrough projects like AI, self-driving vehicles, robotics, and more - the loss of a key employee or two to a rival can have significant competitive consequences and impact.

A debate can be had whether or not the entire idea of employee non-compete agreements are beneficial or necessary (or enforceable), but for the purposes of what I wanted to call to your attention today, let's all accept that for the moment such agreements do exist, and from time to time, are actively enforced by companies trying to protect their IP from escaping to a competitor, (along with the employee).

The story I wanted to highlight is about a big tech company fight over an employee non-compete, but not one of the ones we expect - surrounding some star engineer working on the latest VR or AI tech - it centers around HR, more specifically, around a Chief Diversity and Inclusion Officer heading to Microsoft from IBM.

Here are some details and context from coverage in Business Insider - Microsoft just hired a chief diversity officer - and IBM is suing them over it:

Tech companies have a less than stellar record hiring women and minorities. But these companies will apparently do whatever it takes — including launching a legal fight — to hire one type of person: a Chief Diversity Officer.

IBM is suing Microsoft for poaching its top diversity officer, Lindsay-Rae McIntyre in a case that could prove just how important diversity, recruitment, and retention has become for tech companies.

McIntyre, who joined IBM in 2006, was named chief diversity officer of Microsoft on Sunday, after serving in the same role and as VP of human resources at IBM. IBM, in its complaint, argues that McIntyre had access to diversity data, strategies, methodologies and initiatives that are confidential, and that she "will use, rely on or divulge" these strategies in her new role.

On Monday, IBM was granted a temporary restraining order in New York federal court, which prevents McIntyre from working for Microsoft until the court decides otherwise.

"McIntyre was at the center of highly confidential and competitively sensitive information that has fueled IBM's success in these areas," a representative for IBM said in a statement. "While we understand Microsoft's need to deal with mounting criticism of its record on diversity, IBM intends to fully enforce Ms. McIntyre's non-compete agreement to protect our competitive information."

A really interesting case it seems to me. I admit to not following the ebbs and flows and latest cases in employment law all that closely, but I do follow lots of news and I don't recall seeing a major non-compete case with this kind of profile that focuses specifically on an HR executive, and perhaps more interestingly, on specific human capital management strategies. Whatever specific policies, programs, maybe even some technology applications too that IBM, under Ms. McIntyre's leadership were employing to improve diversity, IBM is contending that these combined represent IP that is not just company confidential, but also represents relevant and demonstrable competitive advantage.

It probably matters that IBM and Microsoft are highly likely to be competing for many of the same kinds of talented people across a wide spectrum of roles. And it also probably matters that (as I have pointed out on the blog for a couple of years on the CHART OF THE DAY series), that labor markets in general are really tight, and for certain 'hard-to-find' roles are incredibly tight. Recruiting and retention ratchets up the CEO's list of priorities when the people the company needs are in high demand and when your competitors are willing to go really far to beat you in the talent game - whether recruiting new grads or poaching your top execs - like Ms. McIntyre.

The diversity angle here is interesting and timely,  and probably contributed to why this was a story coverred in the general tech press. But what would be more interesting to me is to see a major non-compete battle be launched over say a CHRO or a VP of Talent, or even a Global Leader of Talent Acquisition. I'd like to see a major, Fortune 50 or so company go to battle over an HR/TA leader, contending that their particular insights, and their specific talent strategies are so important, in fact just as important as the knowledge of the latest AI hotshot, that the company is willing to battle in court to keep that HR knowledge in-house.

This is a really intriguing case, I will keep an eye on it for sure. It would be interesting and validating too, if IBM wins in this case, and HR programs and strategies are shown to be true (at least in the court's view), completive advantage. And it would be pretty cool for HR to have some more over the top recruiting and retention fights go on over HR people for once.

Have a great day!

VACATION REWIND: There are only 5 possible reasons for every business problem - Bar Rescue Edition

NOTE: I am on vacation this week - please enjoy a replay of a piece from February of this year.

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There are only 5 possible reasons for any business problem - Bar Rescue edition

Some folks who know me know that about a thousand years ago I spent a fair bit of time working in the Middle East - in Saudi Arabia to be precise. And these same folks also know that every one of my probably hundreds of stories I have told about my time in Saudi fall into only five major categories - it was really hot, we had to find gray market beer, I played rugby with a wild group of expats, we socialized with the (mostly Irish and Canadian) nurses from the local hospital, and sometimes you had to deal with some scary police/security people.

Every story, no matter how it starts, ends up in one of those five classifications. In fact, over the years I got tired of telling, (and people got tired of listening to) the old tales, and now I just list the five categories. The details of any one event or experience don't really matter all that much anyway. But the categories are still valid.

What made me think about this again was that over the long weekend I caught a few episodes of a marathon one of my favorite reality TV shows - Bar Rescue. If you are not familiar with the show, the basic premise is this: Veteran bar and hospitality consultant and expert Jon Taffer gets summoned to 'rescue' or help fix a bar or bar/restaurant that is failing, and possibly about to go out of business. 

Taffer will bring in a team of experts like a master mixologist, a chef, and designers and construction crews that together help to renovate the bar, motivate and train the owners and staffs, and redesign products and processes in hopes of giving the bar a new start and (hopefully), keeping it in business.

But what's the connection to 'Steve's boring Middle East stories?' you might be asking. 

Well it is this: Just like my dopey stories, every major problem facing the failing business owners in Bar Rescue falls into five categories as well. Sure there may be some subtle differences in specific situations, and most of these disaster bars suffer from multiple problems, but at their canter, they are mostly, remarkably, the same.

Every failing bar's problems fall into one of these five categories, (with some specific manifestations where I can think of some).

1. Lack of leadership from the bar owners - shows up in a few ways on the show, my favorite are the owners that simply get trashed drunk at the bar every night and have no idea what is really happening. Other times the owners are part-time or 'hobby' owners and have other businesses or jobs that keep them from paying enough attention to the failing bar.

2. Terrible hiring decisions - often this is the 'professional' bar manager that has no idea what he/she is doing. Also, lots of 'friends and family' hiring of people that are totally wrong for the jobs they are in or are taking advantage of their relationship with the owner to get away with doing substandard work.

3. Lack of attention to maintenance and upkeep - these are the bars with dead fruit-flies in the bottles, accumulated grease covering everything in the kitchen, and tubs of expired and/or rotting food in the walk-in. It is actually kind of shocking what some of these failing bars have allowed to let happen - at times it even threatens the health and safety of workers and customers.

4. Little or no understanding of the market/customers - time and time again Taffer and his team have to advise and educate the bar owners about the local neighborhood, the main drivers of potential traffic to the bar, and how the bar stacks up against the local competition. Typically in these situations, the bar owners have failed to recognize and adapt to changes - trends, preferences, and expectations of customers that are not the same as they once were back when the bar was more successful.

5. Failure to understand the economics - this one is pretty common the show and manifests itself in a few ways. Sometimes the owners really don't know how much money they are really losing or owe. Sometimes they don't have a good grasp on the financial drivers of their business, like knowing what food or drink items are most profitable. Or they are getting fleeced by staff (or even themselves) by giving away too many free rounds of drinks and not realizing how much that is hurting the business.

Just like my Saudi stories can be pretty easily classified, every failing bar's problems on Bar Rescue can fit into one of the above categories. And the the more interesting thing about Bar Rescue than my stories, is that these bar/business problems are pretty likely the same broad set of categories just about and business faces too.

Issues with leadership at the top. Bad hires, poorly trained staff, people in the wrong roles. Failing to keep track of the basic elements needed for any kind of success. Not keeping up with market and business condition changes. And finally, not watching and understanding the finances. Every problem (pretty much anyway), fits into one of these buckets.

Figure out in which one of these buckets that most of your business problems fit and you, like the Bar Rescue team, will know where to spend your time and energy making things right.

Your culture is defined by who you're willing to re-hire

First the news on how owner and Class A jerk, James Dolan continues to destroy my single, favorite sports team, the New York Knicks.  From the Deadspin piece The Knicks and their Owner James Dolan, Are Shameless Garbage:

Earlier today, James Dolan announced that Isiah Thomas, who once sexually harassed one of his co-workers while he was head coach of the Knicks, was going to be named president of the WNBA’s New York Liberty. To most people, putting a sexual harasser in charge of a women’s basketball team is a bad look, but the Knicks would like those people to know that they don’t care about bad looks.

For those who might not be familiar with the entire back story, the facts of the case are these.

1. Isiah Thomas was once the Head Coach and President of Basketball Operations for the New York Knicks from 2006 - 2008

2. In October of 2007, a Federal Court in Manhattan, in response to a claim by a female former team executive, Anucha Browne Sanders, ruled that Thomas had sexually harassed Sanders, and that Madison Square Garden, the owner of the team, improperly fired her for complaining about the unwanted advances.

3. Sanders was awarded $11.6 million in punitive damages from the Garden and James L. Dolan, the chairman of Cablevision, the parent company of the Garden and the Knicks. Of that figure, $6 million was awarded because of the hostile work environment Mr. Thomas was found to have created, and $5.6 million because Ms. Browne Sanders was fired for complaining about it.

4. After finally being fired by the team in 2008, Thomas has drifted in and out of several basketball roles, serving as a college coach at Florida International for a bit, and recently as a TV commentator.

5. And now, yesterday, the aforementioned James Dolan, who still presides over the Knicks and their Women's NBA team, the New York Liberty has not only re-hired the sexual harrasser Thomas, he has also placed him in a position of authority for the WNBA's Liberty. If you were a player or coach on the Liberty you can't be feeling really happy about reporting to a confirmed workplace sexual harasser like Thomas.

I think if I had to pick one, singular data point from the sea of human capital data and information that is available to organizations today that reveals the most about an organization's culture and what it is they believe in (if anything), it would be which former employees that they are or are not willing to re-hire. 

Initial hiring is kind of a crap shoot, even the best shops make 'bad' hires every so often. And really great organizations are sometimes guilty of waiting too long to pull the lever on a termination, even when it is justified or the person is just not working out. It happens.

But the bad hire on a re-hire? That should NEVER happen. The people you are willing to re-hire and who you are done with forever tells anyone what kind of an organization that you want to be. You know exactly who these people are, what they can do, and whether or not you would be proud to have them represent your organization.

The Knicks, it seems, want to be an organization that no one can take pride in.

A warning about hiring too narrowly

As an HR/Talent pro if you have been involved in the hiring process for software engineers or developers then it is likely you have run into this scenario when presented a hiring requirement from one of your managers:

Find me someone really proficient in (one from a long list, doesn't really matter which one), Node, Django, jQuery, AngularJS, Redis, Ruby, etc. and I need him/her right away. So you set out to examine your ATS, check LinkedIn, StackOverflow, GitHub, the Starbucks over by your local University - whatever, and you secure the person that is proficient in skill 'X' , just like your hiring manager asked for. Sean Scully, Maesta 1983

Everyone is happy, right? The candidate found an opportunity that matches their skills, the hiring manager got someone that knows the specific programming language that they need, and you can move this Req into the 'Closed' folder and see if anyone brought in any extra Halloween candy to the break room.

But there could be a longer term problem with this kind of approach to hiring, it can result in something called 'Resume Driven Development', a condition where the products that get ultimately developed and provided to customers become a reflection not of the requirements of the customers, but of the capabilities/resumes of the developers that work on the project. 

What this looks like is pretty thoroughly explained in this piece from the O'Reilly Radar blog:

Resume Driven Development happens when your group needs to hire a developer. It’s very hard to tell a non-technical HR person that you need someone who can make good decisions about software architecture, someone who knows the difference between clean code and messy code, and someone who’s able to look at a code base and see what’s unnecessary and what can be simplified. We frequently can’t do that ourselves. So management says, “oh, we just added Redis to the application, so we’ll need a Redis developer.” That’s great — it’s easy to throw out resumes that don’t say Redis; it’s easy to look for certifications; and sooner or later, you have a Redis developer at a desk. Maybe even a good one.

And what does your Redis developer do? He does Redis, of course. So, you’re bound to have an application with a lot of Redis in it. Whenever he sees a problem that can be solved with Redis, that’s what he’ll do. It’s what you hired him for. You’re happy; he’s happy. Except your application is now being optimized to fit the resumes of the people you hired, not the requirements of your users.

The problem is that your team is optimized around the inability to communicate at a critical stage: the inability of a technical team to specify what they really want (a developer with good programming taste and instincts), and instead hiring someone who has a particular skill or credential. I suspect that Resume Driven Development is quite pervasive: an overly complex application stack that’s defined by the people you hired, and by the current toys that the “cool kids” on the programming block get to play with, not by the requirements of the application.

A pretty good example and reminder that in hiring, as in the rest of life, you get what you pay for, or in this case, what you ask for.

And I think this problem, or this tendency, might only get more likely over time as organizations try and move to more 'just-in-time' talent acquisition strategies that incorporate more and more contingent workers.

It is not an easy problem to solve for sure. The natural or easy tendency is to try and define or simplify the hiring process into simple or discrete definitions. Hire Person 'A' with Skill 'B', to code in Product 'C', that kind of thing.

But there is a definitely some advantages that can be accrued by expanding, at least somewhat, the requirements for both technical and even non-technical roles.  The warning though, that Resume Driven Development suggests, is that unless you know exactly what you will need, for at least the foreseeable future, then you are going to get forced into being locked in to a set of people and technologies that you may not want to be locked in with.

Experience is overrated

Check out the latest in the New York Times 'Corner Office' interview series, this one with CEO of Spreecast Jeff Fluhr, (who was also the founder of StubHub), and thus probably knows a few things about finding and retaining talent).

Fluhr, in no uncertain terms, takes umbrage with the traditional, overly cautious in a CYA kind of way, approach to hiring that essentially seeks out only those candidates that have already done pretty much the same job that you want them to now do at your company, and at a company that is pretty similar (industry, size, location, etc.), to your shop.American Pop I - Mo Mullan

Basically, you want a slightly fresher, more enthusiastic, (probably younger although you won't admit it), version of the person who just left the job. Someone that can simply be plugged in to the machine without too much bother and the great ship of industry can just keep steaming along.

But Fluhr says you're wrong to try and hire in that fashion. And he explains why in the NYT piece:

What I was often doing at StubHub as the company grew was to say, “O.K., we need a V.P. of marketing and we want somebody who’s been a V.P. marketing at another consumer Internet company, and hopefully, they’ve done these certain things because that’s what we need.” But the reality is that if you get somebody who’s smart, hungry and has a can-do attitude, they can figure out how to do A, B and C, because there’s really no trick to most of these things.

One of the things I tell people is that experience is overrated. I still sometimes find myself falling into the trap of thinking, when I’m trying to fill a role, “Has the person done the work that the role requires?” That’s the wrong question. It should be, “Let’s find a person who has the right chemistry, the right intellect, the right curiosity, the right creativity.” If we plug that person into any role, they’re going to be successful.

Fluhr's reasoning and approach intuitively make sense - after all, in only the most highly skilled, technical jobs do these kind of faux-requirements, 'Must have 10 years progressive experience doing pretty much the same thing we want you to do here' actually make sense.

Admittedly, no one wants a brain surgeon or an airline pilot short on experience but possessing a 'can-do' attitude.

But for most of the rest of the roles that often fall into the dreaded 'hard-to-fill' category, ask yourself honestly if at least part of the problem is that the starting point for the definition of the ideal candidate is that they have already done the job, almost exactly the job, that you are hiring for.

Ask yourself if you are really interested in hiring the best talent you can. Or hiring just the ones that won't need much training or won't annoyingly require someone on your team to explain all the knucklehead jargon and acronyms that unique to your business and industry and are so important for your success. 

Happy Monday.