The Savvy Entrepreneur


Holding on to your best employees: An interview Dr. Paul Brown, author of Surviving In The Business Jungle

By Timothy A. Lee


NJSBJ – How important is it for small or start-up businesses to hold on to good employees?

Brown – It’s absolutely critical for this kind of company to have employees who have longevity. There are so many problems associated with owning a business. You have the day to day problems of vendors not supplying what you need, ads not running correctly, dealing with delivery problems, finding new customers etcetera. If the entrepreneur also has to deal with employees constantly coming and going it can be devastating to the business. This is especially true if you’re in a service business. If you’re a service business, and most businesses being started in the U.S. today are, the longer a person works for you the more valuable they become. They get to know the customers, their temperament, wants, needs, delivery schedule and pet peeves. Having this type of in-house support is critical to the entrepreneur attempting to build a world-class business.

NJSBJ – How important is smart hiring?

Brown – There is no question that the hiring process is when the entrepreneur gets to really win over a prospective employee to the concept and vision of the business and at the same time gauge the chemistry between the new employee and management. In my first company, MetPath Inc., I had 3600 employees. In the initial few years I made it a point to meet all new employees. Even in the later years I knew some 600 employees by name, as well as their wives and kids.

NJSBJ – In your book you noted that potential employees had to go though a tough interview process before being offered a job. Could you tell us something about the process?

Brown – When I interviewed people, I actually tried to convince them not to take the job. In fact, I had a 500% batting average. I would explain all of the bad things about working for the company like, how hard we expect our employees to work, the long hours, the pressure of working for a start-up and the constant changes because the business was in a period of rapid growth. I would present this entire laundry list of problems they might have working for us. It was very interesting, they would never say no on the spot, but they would call back within a few days and explain that they had thought it over and decided not to take the job. At least that way I minimized the turnover situation.

NJSBJ – By eliminating prospective employees who probably would not have made it anyway?

Brown – Correct.

NJSBJ – You are not afraid of scaring away talented people.

Brown – No! Too many entrepreneurs don’t tell new employees their real role in the company. They downplay the amount of work involved, or the long hours, or the constant pressure. As a result, the company ends up with an unhappy employee who only lasts a few months. In one case we had an employee who only lasted until lunch on their first day. So you’ve wasted all this time training someone for nothing. You’ve spent money on advertising for nothing. And worst of all, the person who truly represented a great fit with the company will probably no longer be available.

NJSBJ – Considering today’s shortage of qualified employees, do you think this process is still the way to go?

Brown – Yes I think the process should still be the same. I believe to be effective the employer has to understand what it is they’re looking for in an employee, whether they’re willing to pay for it and whether or not they’re willing to share the company’s profits with the employee. If they are and they’re willing to make the company’s employees part of the organization, they’re in a position to make certain demands.

NJSBJ – So you are an advocate of stock options and profit sharing programs for employees?

Brown – In every one of the companies I’ve owned over the years my employees have all been shareholders. Every employee had stock options in the company. Granted, a small business may not be able to offer stock options because they may not be a public company, however, they can still offer profit sharing. Longevity is what you’re trying to effect. You’re trying to gain the employee’s loyalty and dedication. Nothing motivates like having a piece of the action.

NJSBJ – Why do you think so many employers have trouble holding on to talented employees?

Brown – They do not understand or relate to their employees, they leave their employees out of the information loop, they do not acknowledge their employee’s contributions, they do not attempt to nurture or grow their employees and they have bad managers. Finding top managers who have interpersonal skills and have the ability to keep employees motivated and focused on the company’s goals is a must for any entrepreneur endeavoring to build a world-class company.

NJSBJ – How important is money to retaining employees?

Brown – I feel it’s important, however, I firmly believe more people change jobs because of bad managers than because of money. As I stated earlier, my first company had 3,600 employees in three countries. The company I own now, HEARx Ltd (AMEX: ear), has 350 employees. Over the years, very few of our employees have ever left because of money. People have left because their spouse was transferred. Eighty-five percent of our employees are women and many have left because they became pregnant. Some return after the pregnancy some don’t, but those things represent a much bigger factor for our losing employees than money.

NJSBJ – A recent study noted that many of those questioned cited they would change jobs for a ten percent increase in salary. But it also noted that when people leave for such a small increase it actually stems from other problems within the company. Do you agree?

Brown – Absolutely, I hired a secretary about a year ago. During the interview process she asked whether I would be throwing anything at her—and she was serious! She had worked as an executive secretary for another company for six years and whenever she made a mistake the executive would throw something at her. She wanted to make sure she wasn’t walking into that situation again. If today’s young talent joins a company and gets exposed to a company or manager who has a bad or condescending attitude, they’re simply going to leave and take their youth, energy, fresh ideas and talent to another company. It’s up to the entrepreneur to understand how his/her key management people relate to the company’s employees. It’s up to the entrepreneur to lead the way in developing a positive relationship with the company’s employees. If the entrepreneur and his/her management team don’t forge this relationship the company going to lose many of its most talented employees and the perks won’t hold them. When I owned MetPath Inc., I ate in the same cafeteria and in the same area as all of the other employees. We also had an open parking policy that allowed any employee to park anywhere in the lot. While there were, of course, managers and workers we were all stockholders in the company and had the same goal of giving the customer superior service and making money.

NJSBJ – What attributes should an entrepreneur have when trying to build a world-class company?

Brown – There are three things that every entrepreneur needs if they are going to be successful: common sense, interpersonal skills and persistence. If you don’t have them you’re not going to make it.

NJSBJ – How important is it for the entrepreneur to get his/her employees to buy into their vision of building a world-class company?

Brown – It’s vital! That’s what I try to do from the very first interview. I point out what I’m trying to do, in what direction I want to take the company and how we intend to change our industry. I have to get the employees to sign on to my delusions of grandeur. I have to get them excited about the entire concept of helping people and growing the company while making money at the same time. If I can get them on board during that twenty-minute interview they’re likely to stay on board for the duration. And since I lay my cards on the table right from the beginning, they’re automatically included in the information loop and begin to feel like part of the team.

NJSBJ – In a nutshell, what does today’s entrepreneur, in the process of building a world-class company, have to do to retain their best and most talented employees?

Brown – 1. Get them to buy into your delusions of grandeur. 2. Get them involved in the reward so that they participate in the profits of the company thus giving them a vested interest in keeping the company moving forward. 3. Keep your people in the information loop. Lack of communication is a major problem with small or start-up businesses because so many things are going on you sometimes forget your people. You may not notice it but they will.


Dr. Paul A. Brown left behind a career as a pathologist to start a company called MetPath out of a two-room apartment. 15 years later he sold the company for $140 million. He then started another venture HEARx, which this year expects revenues of $50 million. He wanted to share his experiences with other entrepreneurs so he wrote Success in the Business Jungle: Secrets of an Entrepreneurial Animal. You can find his book at better bookstores everywhere.


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