April 21, 2022

TPL Insights: Building Peak-Performance Cultures #115- How Bill Higgs Built a Culture of Peak Performance at Mustang Engineering Part 4

By Rob Andrews

With paraphrased content from Bill Higgs’ book Culture Code Champions

This week, we continue our examination of Bill Higgs’ success in building a peak performance culture using two key TPL principles, Disciplined Human Capital Practices, and a High-Performance Mindset.

The Right DNA

Bill Higgs says that hiring only people who had the Mustang DNA into the firm was critical to its success. The Mustang DNA requirement was necessary to build a strong cohesive culture. I’ll pause for a moment and address diversity, equity, and inclusion. Bill believes, and it’s been born out, that a truly inclusive culture is not only possible, but made easier if hiring is based on cultural fit and performance expectations; devoid of discrimination based on race, creed, color, sexual orientation, generation, political preferences and all the other things we know about. When the employment brand, recruiting, screening, hiring, and promotions are driven by purpose, mission, values, and desired behaviors, it becomes much easier to have a healthy debate with those who don’t share our beliefs on the issues.

If new recruits had “Mustang DNA” says Bill, they would feel completely at home in the company, regardless of the personal differences that might exist, and how much flexibility was needed to get along at such a project-based firm. Getting the “DNA thing,” meant people had to be incredibly flexible, able to adapt to different projects, different clients, different market conditions, even different locations. If the candidates they interviewed were concerned about title, an office, or the trappings of some companies, they were simply deemed to be not a fit. People with “Mustang DNA” understood that job satisfaction and job security resulted from Mustang’s passion for “making heroes” which they routinely did internally and externally.

Mustang went from doing simple projects in one hundred feet of water to $5 billion “floating cities” in 8,000 feet of water in less than eight years, with disciplined hiring and a high-performance mindset. A high-performance mindset was a critically essential element of the Mustang DNA. It was a value that incoming employees had to share. Because mindset was so important to Bill, he didn’t discount “kids” who didn’t have what many considered requisite experience. They learned that lesson when they hired their first intern who was in her sophomore year in college. Not only did the young intern stay for years, she also won the hearts and minds of her older teammates by challenging them and showing them technology shortcuts and tools they’d never seen.

Mustang’s first “kid” hire was so successful, they determined to bring more young people with no experience, but with the right DNA into the firm. The industry had gone ten years without bringing in young people, so this was a real departure from the norm. Mustang understood that many clients didn’t want inexperienced people working on their projects, but that shortsighted viewpoint would ultimately result in a severe leadership void because of the huge age gap that exists in the oil & gas sector. They began the “Young Guns” program, bringing in recent high school and college graduates every year for ten years. By 2016, every young gun with 10 years’ experience was in a leadership position!

Communicate More and Better to Retain Great Talent

Bill says it’s not enough to hire the best, train the best, build strong culture, and develop extraordinary talent. He says that to drive turnover below 5% (which is where Mustang was when the industry was above 35%) you’ve got to communicate well and often. Bill learned from a card system in the army to communicate with each person at least once a quarter, a system that pushed re-enlist rates through the roof. When Bill met with officers and enlisted folks alike, he talked to them about their interests and how he could help them find their passion in the army. Once these soldiers felt listened to and valued, they were eager to sign up for another tour. The retention rates improved so much Bill felt comfortable not offering reenlistment to mediocre performers. Bill and his Mustang partners made regular communications a top priority from the very beginning.

Stay Connected with Your Industry Talent

Buckle up. Bill says if you follow this advice, you may soon find yourself with a waiting list of experienced people wanting to join your company. During Mustangs’ fourth year, they created a simple “talent directory” of all the technical talent in Houston that might be needed in the future. Since Houston was the center of the universe for oil & gas, every conceivable professional was resident in the city. Companies like Mustang, who did project work, needed to know where to go to find talent when they needed them. The directory grew to twenty-eight categories and covered every skillset and level. Mustang was diligent about keeping their talent directory up to date and promised to stay in touch with people that applied when they didn’t have openings.

Another of my favorite CEOs, Bob Aylward, who we placed at Jones & Carter in 2015, took over a civil engineering consulting firm that had serious cultural issues, which were revealed during an Organizational Health Index we conducted for the firm in 2014. These cultural issues resulted in remarkably high turnover everywhere below the board level. In addition to turnover in their corporate office, the company had a reputation as a sweat shop and couldn’t retain middle level engineers, which meant it couldn’t grow. After Bob dealt with his cultural issues, he did something I’d never seen before, and which I thought was brilliant.

He transferred the recruiting function to the marketing department and mapped the civil engineering talent in its five major markets: Houston, San Antonio, DFW, Austin, and Brian College Station. Once every civil engineer in these markets had been identified, they began communicating with them every month, not necessarily to recruit them, but to offer something of value. They viewed civil engineers they might want to hire one day as valuable people with whom they wanted to build a relationship, regardless of whether they ever hired them. Bob then went a step further and sent hand-written notes each month to those individuals that had been identified as top performers. Long story short, Jones & Carter now has a robust waiting list of top talent waiting for the opportunity to join them.

Bill’s book is full of amazing suggestions, particularly in 2022, when we’re all experiencing the tightness of the labor market. If Bill and his team could build a company with less than 5% turnover in an industry known for severe cycles and little loyalty between employers and employees, we can too. I hope this content has been helpful for you. Stay tuned for next week when we dig deeper into Part 3 of the Mustang culture. Today’s post covers material from pages 49 – 53 in Culture Code Champions.

Warmest Regards,

Rob Andrews
Allen Austin
Consultants in Retained Search & Leadership Advisory