Its the People, Stupid

ITS THE PEOPLE, STUPID. Live by that slogan, and you can get elected to office, run a corner grocery, throw a great dinner party and even grow a $500 million telecom company with a little help from your friends. Its how we grew PAETEC. Its the people: employees, customers, suppliers and everyone else in the communities we serve. Having a caring culture means your business begins and ends with people, not a logo, or a business plan, or a domain name. As a result of this fundamental principle, the first hundred people signed up before we even clearly knew how we were going to do business. They knew their worth would be recognized and that they would be joining a family of co-workers.

I became committed to the notion of putting people first when I worked for ACC Telecom in Rochester, N.Y., before it was sold to AT&T. In 1998, I could see the opportunity to leave ACC and start a new company, with a clean slate a chance to avoid all the mistakes Id seen telecom companies make in the past and do things the right way, from the first day. The most important lesson Id learned was that success in business begins and ends with people: the ones you hire, the ones you partner with, and the ones you serve as your customers.

It isnt simply the right thing to do. Its the only way to do business now. Everything, telecom no less than anything else, is becoming a commodity. As Thomas Friedman points out in The World is Flat, the playing field has become level for nearly everyone: any traditional advantage a company or a nation or an economy has had over others in the past is disappearing. Knowledge is freely available. So is talent. So is nearly every resource that used to give one enterprise an edge. What remains is the quality of the human relationships that hold an enterprise together. An enterprise needs to put people first, so that its employees will do the same thing in the way they relate to customers. Its managements responsibility to recognize that its greatest competitive advantage now is the way its people work for one another and for the market they serve. In the flat world, if business isnt intensely personal, it wont succeed.


PAETEC looks for character. Work ethic. Team spirit. A willingness to admit mistakes and strive to improve. Thats the core competitive advantage: people who care, who value human relationships above everything else, relationships in the workplace, with customers, in the community and at home. So the first step in putting people first is to hire people who put people first, to hire for character for a level of caring consistent with our culture and not just experience or intelligence or the usual indicators of performance. This means youll have a team of people who will stay true to their character when they might be most tempted to depart from it: during those years when everything and anything seems to make money if those years ever return as well as during the downturns when almost nothing does. Without hiring the right people, it doesnt make sense to treat them as the companys most important asset. It all starts with the most rigorous hiring program possible, the first step in asking people to behave as if they are participating in an entirely new way to do business, something delicate and easy to spoil. PAETEC often has dozens of open positions in sales because it cant find the right people to fill them.

It isnt for lack of applicants. Its just that PAETEC is fanatically picky about who it hires. We have a long list of people who want to work for PAETEC in our Rochester headquarters. Though few people know who we are in most of the markets we service, in Rochester weve become a household word for many people, partly because of the extensive ways weve been involved in promoting the community and partly because were known as a great place to work. People line up to work for us.

The few who get hired are picked because PAETEC hires first for common sense, a common touch. When it checks references, the company wants to know: does this person operate with common sense? Is he or she a quick study? What about attitude and interpersonal skills? Is he or she willing to put an ego on hold and serve others without seeing an immediate personal payoff? Track record isnt the most important thing because the person is coming from the ordinary world into something entirely different; how the person performed in the old world isnt a true indication of what he or she can do in the PAETEC world. Is this the kind of person you invite over to your house for dinner on Friday? Will this person fit into a community of, essentially, best friends? Its important because PAETEC hires people it plans on keeping for a long time and promoting internally.

PAETEC puts good people together and then watches as good processes flow into place. Work ethic, integrity, intelligence, and interpersonal skills: those are qualities that are either there or not there in a recent college grad and a 20-year veteran alike. Oddly enough, good times can be the toughest test of character. Thats when people are naturally eager to bask in rewards for their effort in ways that would erode the character of the company. Ive got people who want the extra perks now that were successful, and I still say no.

Arunas Chesonis is chairman and CEO of PAETEC Communications Inc. The preceding article is an excerpt from his new book, It Isnt Just Business, Its Personal: How PAETEC Thrived When All the Big Telecoms Couldnt (RIT Cary Graphics Arts Press). The book is co-authored by journalist David Dorsey, author of The Force and the fiction novel, The Cost of Living.

Read More: Following the acquisition of competitive carrier US LEC, PAETECs CEO Arunas Chesonis talks about how he plans to continue his companys existing culture of putting people first at a now much larger company. Read xchanges April cover story, PAETEC CEO: Happy People Create a Healthy Business.

PAETEC Communications Inc.

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