Firms that export are not only more profitable than their non-exporting peers, they have higher productivity rates and thus pay higher wages.
The same is also true of firms who start exporting after being in the business of non-exporting for a few years.
Why would this be?
High-performance, high-productivity firms choose to compete — choose to put themselves outside of their comfort zone and are comfortable being uncomfortable. Why do people choose to live like this? Why have the founders of these businesses not only chosen to export, but also surrounded themselves with people who support this and want it?
Its a process called self-selection. Self-selection is the act of putting ourselves forward for something based on the choices we have made and our preferences. The more our choices and preferences align, the happier we are and the better we perform.
(By the way, people who are happy at work and with their job, work for 16% less on average. High performance is not about the money)Think of the old saying “Birds of a feather flock together.”
The owners and managers of these SMEs understand the value of organizational culture — the people, their skills, intellectual capacity, drive, and motivations. This organizational culture is the critical success factor for the company and it is what delivers the desired outcomes. Steve Jobs was once noted on an internal management conference call as drawing a parallel between your people and ice cream.
Imagine a beautiful bowl of ice cream, all your favorite flavors. Sound good? Delicious. Now, imagine the same bowl of ice cream but someone has flicked a tiny speck of dog shit on to it.
Still want it?
No, that single speck of shit has ruined it. It’s the same for people in the organization. Get one shitty employee and it ruins your business.
So when recruiting, it’s critical to know who you want and why. It’s never about the money (people that want money should be avoided as they never make it). It’s about the signals and messages you send to attract those like you who want to be uncomfortable, want to learn, be challenged and be more than they are today. So building a business model around high-performing people who will make you feel challenged is imperative. The key to long term success is competition, creative destruction and instability.
Good businesses always end up exporting because that’s the natural evolution of what excellence does. It’s also what you must do. But irrespective of where the evidence comes from, Germany, France, USA, UK, etc., the same is everywhere: firms who export have higher productivity rates, higher profitability; they are more sustainable, and last longer.
So in terms of trying to find the right people to execute effectively — listening and learning and understanding what people are telling you about who they really are, or what they think or feel from the message and signals you send is essential for successful recruitment.
I will give you an example.
Google.
Google ran the following on billboards in San Francisco and Harvard Square:
{first 10-digit prime found in consecutive digits of e}.com and a mention of a job.
Once you have worked out that the website was 7427466391.com you were then given a second problem to solve and only then were you presented with information that this was Google and they were recruiting. Their explanation read:
“One thing we learned while building Google is that it’s easier to find what you’re looking for if it comes looking for you. What we’re looking for are the best engineers in the world. And here you are. As you can imagine, we get many, many resumes every day, so we developed this little process to increase the signal-to-noise ratio.”
This is how you self-select.
(For those of you who would like to understand more on self-selection and Personnel Economics, please Google Professor Mike Gibbs from the University of Chicago. I recommend his books and papers.)
What does that mean?
It means that as individuals we select what we want, and we choose where to work and how we work, and the products we buy. It is ultimately a belief in ourselves and our own abilities. So, in personnel economics, this means we can talk about high productivity and low productivity workers, and how we select between the two.
This includes everyone from managers, directors, and employees on the shop floor.
When recruiting, a way to select the high-productivity workers and put off the low productivity workers is, for example, advertise a job at a certain rate, but the job offer will go out at a discount during the trial period. After the trial period the discount is removed and the employee gets a bonus that reflects the discount so they suffer no loss.
A high-productivity worker will always take the discount because they know they will make it through the trial period and make the money back and also make bonuses.
Low-productivity workers will decline because they know they will not make it as they can’t compete.
Bingo!
Why does this matter?
When running a country or running a business, or just in everyday life, we must learn to not just listen to the words people use, but understand the intention behind the words, taking in the non-verbal cues and understanding the psychological message.
What are they really saying?
In every interaction we give ourselves away. When recruiting, look for signs of games as well as trying to understand if the person is high-productivity or low-productivity. There are a number of psychological games that some people play and these are toxic.
For example, one of those games you have likely met is called the “yes, but…” game. This game only needs two players. If someone has difficulty doing something they might complain to you about it and might naturally respond by offering a solution; “That’s interesting, have you tried doing…?” the other person will say, “yes, but…” and counter with a reason why your proposal wont work.
This game repeats until you get bored and walk off. For the player of the game they have won, because to them this was not about solving a problem, but about proving a parent or parent figure wrong. In the here-and-now of the conversation they are the child and to them you are a controlling parent (See Games People Play by Eric Berne and TA Today: A New Introduction to Transactional Analysis by Vann Joines and Ian Stewart), the objective is prove the parent wrong.
So you can see here how the social transaction differs greatly from the psychological one. Other common games and toxic behavior include the use of guilt, shame and pretending to manipulate people (what kind of motivation is that?), disqualifying, and forgetting.
Disqualifying is when people deliberately hurt someone but then does it again by wrapping a criticism around the apology, again this is about control and manipulation.
I include forgetting because this is a good example of a passive aggressive behavior. Players of this game are hurt and angry and they express their emotions by “forgetting” things to hurt you and make you angry these people cannot take responsibility for themselves and also tend to blame others.
These are the specks of shit I suspect Steve Jobs was referring to.
Listen very hard to what people are saying and in addition always be alert to their non-verbal cues (body language, posture, blocking) as well as trying to understand their mind and how they think and feel. Yes you might hear lots of lovely things when interviewing, from politicians, or when someone is selling something, but what is the intent and motivation? What is the psychological message?
To bring it back, in today’s world we are seeing a rise in right-wing politics, golden age nostalgia, and protectionism. This is not just in country politics, but at a personal level, a rise in unionization, a rise in trade wars, and so on, all different forms of hurt (under anger there is always hurt) that result in division, fragmentation, and blame.
Life on the Drama Triangle.
When a country tries to protect itself from international trade what its saying is it knows it can’t compete. When workers want protections, they know they can’t compete. When managers want mega mergers, some form of special treatment, they know they cant compete and they all — workers, managers, owners — try to lobby and influence those in power to get their way.
This is a de-facto corrupt practice (corruption is the abuse of entrusted power for private gain) and too many have their piggy snouts in the trough trying to gorge on whichever political ideology they might have been seduced by.
The problem is, the evidence is very clear — these strategies always fail. Countries with protectionist and/or mercantile policies always lose out, they always fall behind and they always fail their people.
No successful global economy has ever managed to build itself into a powerhouse by being protectionist.
(For more reading, Why Nations Fail: The Origins of Power, Prosperity and Poverty by Daron Acemoglu and James A Robinson.)
France is a classic case of this. France is a good example of these kinds of policies gone too far. Policies based on unrealistic expectations — A job for life, for example. Their people want protection because they know they can’t do the job, they know they are failing and don’t have what it takes.
It’s an inward-looking victim mentality. The Drama Triangle — I’m a victim, capitalism or foreigners are persecuting me! Socialism or Fascism rescue me!
This is not what we should be doing in a functioning economy. You should never put up trade barriers or subsidize any economy.
Beyond a functioning legal system with an independent judiciary that treats all as equal , economic protections have no place in the economy.
We can see very clearly which economies, and which businesses in the world perform the best. That is something you cannot argue with. You can argue with it as you choose, but what that says about you is that you’re somebody I don’t want in my business. You let your emotions and how you feel get in the way of evidence.
How you feel has nothing to do with it.
A company that looks to compete with the world is looking outward, seeks challenges, has drive and motivation. The people within the company are living the Kilian Jornet definition of winning — what must we change and overcome in ourselves to win?
The clear fact is that when you’re running a business, or a country, or your personal life, listen very carefully to what people are telling you. You have the words, this is the social element, but try to understand the underlying psychological element. What are they really trying to say?
Listen for things like would, should, could, and but. Should and could are potential manipulators as there are implied criticisms within the statement and a “but” discounts everything that went before it.
How does this person feel about their position in life? What are their expectations? Do they have unrealistic expectations? Do they feel like a winner, or like a victim? Why are they putting their shit on you?
Narcissists and alpha males are dangerous people, those who think themselves victims are also dangerous.
Whether you push or pull somebody down, it’s the same. As Booker T Washington said,
“One man cannot hold another man down in the ditch without remaining down in the ditch with him.”
It matters not if we were pulled or pushed into the ditch, anyone that tries to justify excluding or holding down others is weak.
Just like the prisoner’s dilemma, we’re all better off when we confess, so get to know yourself and win the Kilian Jornet way.
Founder and CEO of Datum Alloys, Ben is a dedicated innovator and thought leader in the tech world seeking straightforward solutions for industry needs.
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