1st Lead U - Leadership Development
This podcast, now in Season 3, is dedicated to self-development, self-awareness, and learning to lead oneself so listeners can lead others well. If someone cannot lead themselves well, it will be difficult for them to be an effective leader of others. This podcast will help listeners understand what it means to 1st Lead U and build confidence in themselves and their leadership ability. Personal Growth Coach John Ballinger has spent 35 years developing the knowledge and material he shares with individuals, business owners, and leaders from a variety of areas.
1st Lead U - Leadership Development
Human Capital: The Key to Team Success - C.H.A.R.T - EP 316
They're actually investing in the knowledge, skills, health that you, as a person, have invested in and accumulated throughout your life, enabling you, the team member, to realize your potential as a productive member of society.
Announcer:Welcome to First Lead you, a podcast dedicated to building leaders, expanding their capacity, improving their self-awareness through emotional intelligence and developing deeper understanding of selfless leadership.
John Ballinger:Hello America and welcome to First Lead U where we believe selfless leadership is essential. America is suffering a leadership crisis. Self-awareness and emotional intelligence is the key to developing selfless leaders.
Announcer:Now here is personal growth coach John Ballinger.
John Ballinger:Hello leaders, Welcome to First Lead U. My name's John Ballinger. I'm here with my trusted co-host, Mr Douglas Ford. Good afternoon, John. How are you today? Well, Douglas, let me go ahead and do a disclaimer.
Douglas Ford:What's that?
John Ballinger:I had a touch of a cold, so I may sound a little bit nasal. There could be a moment where I break away from the microphone and cough, but I do have a cough drop in. So if you hear a little clicking noise, that's not me and my tongue, that's the cough drops kind of sliding around. So just want to make that clear to the audience that I do have a little cold so, but other than that I'm fine, I feel good, but it's just a little tad of cold. Thanks for asking.
Douglas Ford:Yeah, absolutely, and we also have some new equipment, dave, that we're working on and experimenting with, so it could be sound a little different today, and we'll get all that worked out as we move through the next few episodes.
John Ballinger:It's a pretty new piece of equipment, isn't?
Douglas Ford:it. It is got a lot of lights on it.
John Ballinger:A lot of luck and they do crazy things. So if Douglas hits the wrong button and all of a sudden I sound like some kind of monster from the black lagoon, you'll know Douglas is messing with the board.
Douglas Ford:Yep, the black lagoon. You'll know douglas is messing with the board.
John Ballinger:Yep, lots of new toys to play with. We'll have to get all those figured out, yeah, uh. So today we're starting our last h yes h in our acrostic chart.
Douglas Ford:so the last eight is going to be what human? Oh, that sounds interesting.
John Ballinger:It is interesting, but I told you the other day when we were finishing up the second to last H, we kept interchanging a word. I said we got to stop doing that. You remember me talking to you about that.
Douglas Ford:Sure, I do.
John Ballinger:You looked at me like you don't know what you're talking about. Sure, I do. You looked at me like you don't know what you're talking about. I said part of the time we were calling people employees and team members Yep. I said we've got to stop talking about that. We've got to stop talking about that as much as we tell people. Stop saying higher, say select.
John Ballinger:Well, not just stop saying it, Start thinking Well not just stop saying it, start thinking Well, start Okay, start thinking that's good, yeah. So I wanted to start off. Before we start with H, I want to talk about why we should say team member versus employee and this is very interesting because I did some research. Yeah, I think it's super important, yeah, so, in general, if you look out and of course, there's AI and there's, you know, chat, gbt and grok and all these AI platforms but in general they say an employee is someone who has an individual purpose for a company.
Douglas Ford:Okay.
John Ballinger:A team member is someone who has a group of shared purpose with others, so it's a group. A team member is someone I want to be in a group, I want to have a shared purpose with others, I want to work together. Or the employee is someone that says I'm just here to do a job, I want a paycheck. So I started thinking about that. And the team member. And when you dig down a little bit deeper, it's someone. When they started interviewing people that said that they wanted to be part of a cohesive unit that works toward a common goal with a shared sense of purpose and accountability. Now, if you're an employer, do you want employees or do you want team members? Well, I think you want team members, but I think if you're an employer, do you want employees or do you want?
Douglas Ford:team members. Well, I think you want team members, but I think if you're a person who's been hired by someone else to do a job, selected by someone else to do a job, you also want them to think of you as a team member versus an employee, because if I am the employer and I think of everyone as employees, it's easier for me to think of them as tools to accomplish something versus a group of people who are all moving together in the same direction to try to accomplish something. And so I think, both from the team member side and from the employer side, it's important that we use the right language.
John Ballinger:Yeah, I agree, I was thinking. You know, through the process of us talking about, you need to select versus hire. If you take employee versus team member and hire versus select, if you took those two words employee and hire and teamwork and select which one's going to create human capital.
Douglas Ford:Teamwork and select.
John Ballinger:Yeah. So it's interesting that our fourth letter was human capital and our last podcast. I said we've got to clarify why we say team member, not employee. And then also let's talk about why we started off originally years ago saying take the word hire out of your vocabulary, because there are times I've been in this situation where I've been brought into a company where the employees were hired and when I went in I could tell that everybody was on their own aisle, everybody had created their own, basically their own kingdom, and there wasn't cohesiveness and there wasn't a unit. Well, what's productivity like Not good? What's teamwork like Not good? What's productivity like Not good? What's teamwork like Not good? What's profitability like Probably not good? Here's another one what's turnover like Probably not good yeah.
John Ballinger:Yeah, Big, and so we're getting this. The human capital piece of it, We'll get into this, but it's important to know that if you select team members, you have a greater chance of having a human capital growth inside the organization. That turns into a more profitable organization and you reduce turnover, which, according to statistics I read earlier, the average cost of attracting a new team member right now in America is $4,700. The cost of losing that team member, having to attract another team member, train that team member and get them up to speed of that team member that left, which is usually, they say, an average of six to nine months is the time that someone comes in and leaves it's $35,000 to $40,000. So remember the words or remember the numbers $4,700 and $35,000 to $40,000. And does a company have the ability to select a team member versus hire an employee? Because look at the cost of not doing it that way.
Douglas Ford:Yeah, I think people would think about the selection process and that, oh, that could take too much time, it could cost too much money. But when you put those types of numbers to it, it really makes a lot more sense to take the time and to spend the money so that it doesn't cost you more time and more money later on.
John Ballinger:Yeah, and business owners really don't think through the process. Human resource departments don't think through the process. Human resource departments don't think through the process. I've personally been involved in attracting, selecting C-suite executives for companies and the normal process to do that has been to onboard or bring on a vendor called a head hunting company to do that, and I've watched the headhunting process take place where there was a job description and a resume and there was a marrying up, if you would, of the two. And then that person is then flown in to the company, they're taken to dinner, they're kind of paraded around a couple of departments and people that really don't know the difference in hiring and selecting have an opinion about what to do in that company, and so they bring that person in. And in one particular case that person had been there for two years and the intent was to step that person up from a controller's position to vice president of finance. And when I was inside the company I asked the person that was brought in through the headhunting process how are you going to react to managing leading 30 employees in this department? And his response to me is I'm not going to. And I was kind of dumbfounded because I thought I was getting ready to hear a response of well, I need help with this or I'm going to do it this way. What I heard was I'm not going to do it, and I said you're not going to do it. No, I'm not going to do it. And I said you're not going to do it. No, I'm not going to do it. I'm not changing me and who I am for the job of that position. And I'm thinking I wonder if they told him that he's going to have to integrate with those 30 employees and lead them and communicate with them. And so I go back to the person that brought him on and asked you know, well, we really didn't think about that. Did you tell the headhunter that's something you needed? Good communication skills should have been one of the things. No, I didn't do that. Well, that's a problem. And two weeks later he resigned.
John Ballinger:So it's important and I know we're spending a little bit more time than probably we should on this, but if you're going to create human capital, use a selection process of team members, because you're going to see a person that's more integrated into your team, fits your team and the culture, and you're going to take that cost of, especially now. I gave you the cost of what it is if it's just an employee. If you want to go, what it costs to do a director, vp, c-suite level, it's much more than $35,000 to $40,000 that you're losing and it's much greater than $4,700. It's usually 30% to 40% of their first year salary, much greater than $4,700. It's usually 30 to 40% of their first year salary. And to replace that person is one and a half to two times their salary.
John Ballinger:So think through that. If you're a leader and you've got a process where you hire versus select and you call everybody employee instead of a team member because you need to get into that mindset, so, um, do we need to take a break? Let's take a break and I'm going to come back and I'm going to read the definition of human capital and then we're going to talk about that on the second half of the podcast.
Douglas Ford:Hello First League Youth listeners, douglas Ford here. I want to take just a few seconds during this break to say thank you for spending a few moments with us as we discuss the challenges and opportunities of being a leader. We hope that in every episode you find some bit of information that will help you on your own personal leadership journey. In order to reach more people and to improve our positioning on all the podcasting and social media platforms, it's important that you subscribe to our podcast on your favorite podcasting platform, like Apple, spotify or any other platform where you listen to First Lead you. We would really appreciate you clicking on the subscribe button to help us reach more people and expand the message of First Lead you, and please take time to visit the First Lead you website. That's the number one S-T, the word lead and the letter U dot com. First Lead you dot com. Number one S-T, the word lead and the letter Ucom. I hope you have a great day as you continue to learn to First Lead you. Welcome back to First Lead you.
Douglas Ford:Today we are talking about the fourth H in our chart across it, and today the H stands for human capital and John's going to give us the definition of human capital in just a moment, but just as a quick recap, we've talked about team member versus employee, hiring versus selecting and the cost of those two, and today it costs $4,700 to hire probably a little bit more if you're going to select a team member and it costs $35,000 to $40,000 if you lose a team member a team member and we talked about the definition between employee and also a team member and an individual versus someone who wants to be part of a bigger purpose. And so, john, you've got the definition for human capital. You want to share that with us?
John Ballinger:I do have we gone back to season one and talk about how much I love definition?
Douglas Ford:No, but I keep saying we need Webster to call us, we do need that would be keep saying we need Webster to call us, we do need. That would be a great sponsor to Webster. Well, most people have access to Webster.
John Ballinger:Well, we need someone that knows that we love definitions to sponsor.
Douglas Ford:Maybe we get Wikipedia.
John Ballinger:Oh gosh, Did you just say that I did?
Douglas Ford:I just want to see what you'd say.
John Ballinger:I think I need to go for a second. I'm back.
Douglas Ford:So, John, can you give us the definition of human capital?
John Ballinger:It's the knowledge, skills and health that people invest in and accumulate throughout their lives, enabling them to realize their potential as productive members of society.
Douglas Ford:All right, do it again. We always like to hear it twice.
John Ballinger:I know because that's up. Can you believe that that's a lot? The knowledge and remember, this is human capital. This is someone that's selecting you to come on board in your organization and they're actually investing in the knowledge, skills, health that you, as a person, have invested in and accumulated throughout your life. Have invested in and accumulated throughout your life, enabling you, the team member, to realize your potential as a productive member of society. Imagine if you had a group of team members working for you that had invested in themselves and had been invested in.
Douglas Ford:Yeah, and we've talked about this in previous seasons, about as a team member and you know this is kind of a slightly different mindset too, but as a person who employs people, pays them to do a job, but thinking about them as consultants when they come to your organization and them thinking of themselves as consultant.
Douglas Ford:Because what do we expect most of the time when we hire a consultant or bring consultant on for any reason? We expect get a certain level of expertise, we expect them to kind of hold no punches, we expect them to help us understand the problems better and then in a lot of cases we expect them to perform some tasks and help us organizationally to to improve. But when we bring somebody on, that's going to be internal, we treat them a lot different. And if everybody would kind of start thinking in that concept of we're all consultants and we're all here to give the best we can give, to be as honest as we can, and then the person who's brought them on has to be willing to accept that information and hear it, as opposed to being a dictator or shutting people down when they try to share, because those are the type of things that are the opposite of what we're talking about with human capital.
John Ballinger:Right. So when you break that down inside an organization, I want to talk about the four pillars of human capital inside an organization, because not every person fits every pillar and I'm going to give an example of that. So there are people that bring financial human capital. There are people that bring intellectual human capital table. There are people that bring social human capital. There are people that bring social human capital table and, lastly, cultural human capital. An example of that would be in larger corporations. There are people that are brought in to be called this is a, this is a term that's used a rainmaker. You know what a rainmaker is?
Douglas Ford:Yep, someone who brings in a lot of business, that's it.
John Ballinger:Their job is to create relationships, their job is to create trust, their job is to go out and socialize and be a rainmaker for the organization and then that person's to hand them off to someone that's a fulfillment person. Because, guess what, that rainmaker is not the fulfillment person and it's reckless to think that a company would select someone and this is a social skill they have and you need to do these things. And then, after you make the rain, now facilitate the rain. You know what's going to happen.
John Ballinger:It's not going to work out the relationship will sour quickly, and then the leader in that organization needs to know that. So there should be a handoff from the rainmaker to the facilitator.
Douglas Ford:And that's what we see a lot of times in an organization that has. I have a large sales department, so we have an outside salesperson that'll hand somebody off to an inside salesperson once the relationship's been established, but go back to that again. So we've got the financial.
John Ballinger:The financial capital.
Douglas Ford:The intellectual capital, correct, social capital, cultural, cultural capital.
John Ballinger:Yeah, so we. We knew a gentleman that worked for a very large corporation and he was extremely difficult to work with in america inside his business, but he was excellent. When they sent him overseas to create relationship you know how I'm talking about I do and we're like just that job by itself. That's all he needed to do, because when you brought him back after he created the relationship overseas, it was terrible inside the organization, wasn't it?
Douglas Ford:Yeah, it was uh, everybody had difficult time working with.
John Ballinger:Yeah, but, but everybody talked about when he left and went to foreign countries. You know it was amazing what he could do, so he was very productive. So so, rainmaker, come back, don't be the facilitator. And we talked to leadership in the organization many times about that and they would look at us like I don't even know what you're talking about. His job description has this I said you know what?
Douglas Ford:take that out of his job description really yeah, there were other people that were in his department that could do the parts of his position where he was not being successful. They could have done it much better and been extremely successful 100% agree.
John Ballinger:Now to take those four pillars and turn them into human capital takes four strategic pillars, and that is vision analysis, target and plan. So we're talking about selecting a team to then decide which one of the four human capitals they fit in and then, as an organization, take those four and create vision analysis, target plan. When you go into companies we've been in companies I say so what's the 1, 3, 5, 10 year look like? What do we hear?
Douglas Ford:I don't know, we don't have one.
John Ballinger:Yeah, Sometimes we'll say this. Depending on the organization, I'll say oh, so I wonder how many times we've gone to battle with America's safety at risk and not had a plan to do it. Now, being an old trusty Army guy, I don't even recall going on a flight mission without having a plan. You filed a flight plan, even if you were just going to fly around. Piled a flat plant Even if you were just going to fly around. Well, you know, if you're going to go into battle and the business and I've said this in this podcast today's business is you're in a battle and you better be jockeying position, because guess what, Guess who's coming?
Douglas Ford:Douglas, the competition.
John Ballinger:AI is coming. All we hear now is ai, ai, ai. So not used to. It was competition from somebody starting a business that thought that they could do it better than you. Now it's you've got artificial intelligence. Don't give me that. Say that. Did I say those two words? You did back to back.
John Ballinger:I shouldn't have said that, but because I hate that, and if there's something, there's a guy out there that's listening to this, which I hope he is he and I have this disagreement. He thinks that I need to actually embrace artificial intelligence and own it, and I say I don't, because at some point there's going to need to be what Douglas Actual intelligence, actual intelligence. So I'm going to reserve myself for that. Okay, I'm just gonna let the audience know. I'm reserving myself for actual intelligence. So, when you all stop, learn how to think, because somebody is thinking for you, I'm going to, I'm going to develop a website called J a J, j a Jcom. So you just know this audience. That's just askJcom. So you just know this audience. That's justaskjohncom. Because if you want actual intelligence, don't call GROP. Okay, I'm just going to put that out there. So, as we're wrapping up, human capital what can human capital do for your organization. I think it takes it to the next level.
Douglas Ford:Well, when you start thinking about a team member and a team of people working on a project, it absolutely benefits the organization because you're bringing in, like I said, those four areas of competence that they need to succeed.
Douglas Ford:And it helps the whole organization be better, especially when you're working together as a team. And during the course of this episode, while we were talking, I kept thinking about different analogies that come to mind, and obviously this lends itself very well to a sports analogy and perhaps football. But the offensive lineman can't decide. They're going to be working on one play, the running backs on another play, the wide outs on another play and the quarterback on yet another play. That's just not going to work, it's not going to go anywhere. But when everybody knows the same play, everybody tries to execute the same play. That gives you the opportunity to move down the field. And so the idea of thinking about teammates versus employees, selecting versus hiring and creating human capital within your team by giving everybody the opportunity to contribute based on their ability to bring financial understanding, intellectual understanding, social understanding, cultural understanding to the table, the better the team's going to work together.
John Ballinger:This as we wrap up. I want you to. We've just thrown something out into society from a leadership standpoint that probably is not talked about every day in small business, even up to large corporations and we've been in some large corporations that what we're talking about is not talked about. So there'll be more discussion as we go through the acrostic as a leader, why you need to embrace the chart acrostic process, because doing so is going to round out your organization, yourself as a leader, and you're going to absolutely see a complete difference in your profitability, your customer service, your team member retention inside your organization. And always remember, in order to lead your team well, you must first learn to lead. We'll see you next time.
