It’s all about the people

ru_yahoo-iphoneThe much-lauded CEO of Yahoo Marissa Mayer has made “people” her number one priority in righting the company ship. Her first year did not yield great results. But if history is any guide, leaders who prioritize hiring and retaining the right people at the company produce impressive turnarounds.

Exhibit A: Back in 2001, Doug Conant took over Campbell’s Soup, a company described as a  “beleaguered old brand.” He made bold moves right out of the gate. He had no choice. The employees had been disheartened and disengaged, wallowing in a toxic culture. Conant wanted to turn that on its head and get the culture right. He knew he had to get new products on the shelves that people wanted to buy. To create a brand where innovation was its core value, the CEO needed to create a culture of engagement and trust. Without those, Conant said, people won’t take risks.

This meant he needed to get the right people into the right jobs. Conant turned over 300 of the 350 top leadership positions, promoting 150 from inside the company and hiring 150 from outside. The emphasis was on getting people who fit the new culture of innovation at Campbell’s who had a certain level of competence and character. Conant also personally ran a two-year leadership program to create a team who could lead in an inspiring way. He also hand wrote 10-20 notes each day to recognize people who were doing well.

The strategy worked. In the five years since Conant had taken the helm, the company’s stock price had increased about 56%. And the company experienced a 17% increase in revenue in the decade under Conant’s people-oriented leadership. The Gallop Employee Engagement Index gave Campbell’s a “World Class” rating.

Mayer has 11,500 people under her charge, including many hundreds of top leaders. Like Campbell’s in the last decade, I’m sure Mayer is finding that many of those leaders are not a good fit. She’ll have to tap into the personality strengths and weaknesses of her team, get people in the right jobs, and develop a culture of engagement and trust. Then the folks at Yahoo can take on the exciting job of coming up with innovative ideas, and fast.