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Libbys Life in HR ... So Far

May 28, 2008

After 30 years in HR, Libby Sartain can tell some stories.

    Like the time a cop hid in the closet while she gave an exit interview to a Southwest Airlines employee who had threatened someone.

    Or the time a Southwest pilot heroically landed a plane with malfunctioning landing gear, then gave a tear-jerker of a speech praising the company’s hiring and training efforts.

    Or the time Sartain managed her first layoff, which included laying herself off.

    That happened in 1979, well before Sartain emerged to become one of the world’s best-known HR professionals, with high-profile stints at Southwest, Yahoo and the Society for Human Resource Management. Sartain, who recently stepped down from Internet icon Yahoo to take a breather in her career, vividly recalls that gloomy day three decades ago.

    She was working as a personnel administrator at a computer services firm. As she prepared layoff packets for other employees, her boss stopped by and told her to make one more for herself. Just 25 at the time, with a newly purchased home and a husband who earned a teacher’s salary, the news brought her to tears—after she left the office.

    "I was devastated," she says.

    Sartain came away from her own downsizing determined to be compassionate to other people losing their jobs. "I will never forget that it is someone’s livelihood and how they’re likely to feel," she says.

    Even as she has sought to retain the "human" in human resources, Sartain has become a force for bringing strategic business thinking to the field. She has co-written two books on workforce management matters, a rare feat for an HR practitioner. Sartain also served as chair of SHRM in 2001, and was named fellow of the National Academy of Human Resources in 1998.

    Under Sartain’s leadership, both Yahoo and Southwest made Fortune’s list of the 100 Best Companies to Work for in America.

    Fred Foulkes, faculty director of Boston University’s Human Resources Policy Institute, calls Sartain one of the top dozen HR professionals in the United States. Sartain helped Yahoo realize the importance of talent in its rivalry with Google and Microsoft, and she has a sharp mind, Foulkes says. He is also impressed with her commitment to fellow HR professionals. "She’s just given a lot to the profession and really cares about it," he says.

    Sartain has taken her lumps along the way, most notably when she was the public face of an unpopular vacation policy change at Yahoo.

    But as Sartain argues, "You have to have a thick skin" to be an HR executive. She just emerged from a tumultuous year at Yahoo, during which the company announced a restructuring, cut 1,000 jobs and faced an unsolicited acquisition offer from Microsoft.

    Sartain, 53, says that even before the Micro­soft offer she planned to resign from Yahoo and relax on a refurbished ranch in Texas for a spell.

    But she intends to return to the profession in some way—and to work on what will be her third book on an HR topic, Brand for Talent.

    In her Silicon Valley home recently, Sartain talked withWorkforce Management senior writer Ed Frauenheim about her HR career so far and shared some thoughts on the field she has helped shape.

    Workforce Management: You worked early in your career at cosmetics firm Mary Kay. What was significant there?

    Libby Sartain: It was still run by Mary Kay Ash. She was running the company and it was starting its growth trajectory. I guess when I joined it had maybe 600 or 700 employees. When I left it probably had about 2,500. It was based on values. It was based on a strong founder’s philosophy. And there was an esprit de corps among the sales force and among the employees that created a culture that was unique.

    Their values started with the golden rule. Then work/life balance—the way Mary Kay would say it would be very controversial now, but she would say, "God first, family second, job third," because she was religious. One of the reasons the company worked was that so many women could work from home who sold the product. And then there was a lot of training in the whole core sales experience about people and making people feel important and making people feel good about themselves, because the product line was all about sort of raising women out of their households.

    Seeing this strong woman who literally started this company with her son with a $5,000 investment—she built it from a small little shop in Dallas; now it’s a worldwide company—that really shaped me. I thought, I always want to work for a company that had these kinds of mission and values.

    WM: Your fame in the field has a lot to do with your career at Southwest Airlines. Did you report directly to Southwest founder Herb Kelleher?

    Sartain: Southwest had a very interesting org structure. Herb was at the end of his career when I was there. He was grooming successors. So he had only three direct reports. He had a head of corporate services, who had areas like finance, legal, systems. He had a head of operations—that had all flight attendants and pilots. And then he had what was called head of customers, and that was Colleen Barrett. And she had everything that touched a person inside or outside the company. So that would involve the frequent flier program, the governmental affairs, the customer relations—and HR, because Southwest had this unique philosophy that our employees were the No. 1 customer.

    It was absolutely another thing that shaped my thinking, because marketing was part of that and sales was part of that. I was part of a team that was thinking about building customers. And that’s what led to Southwest being one of the very first companies that discovered the whole premise of employer branding, which is one of the most powerful tools any organization can use.

    WM: How did you get to employer branding at Southwest?

    Sartain: We had developed our own new corporate brand in 1995. It was "Symbol of Freedom." Before, when we had different tag lines, it was easy for our employees to embrace that. But when we’re talking about something kind of nebulous like a "symbol of freedom," it was hard to get the employees to make the emotional connection to that. We had a culture committee that tried a number of initiatives, including creating a museum full of symbols of freedom. We had our ad agency develop an employee song about freedom. But none of these things took hold.

    So my boss, Colleen Barrett, took the head of marketing and myself out to lunch and said, "Look, our employees have not embraced this brand. I want the two of you to figure it out."

    So we called our people together. It was a very interesting meeting, because we had our ad agency, we had our media buyer, we had two different HR consulting firms—one that did our benefits, and one that did our corporate communications—we had our head of advertising, our head of marketing and several HR leaders.

    At the end of the day, somebody said, "What if the experience of working at Southwest Airlines was a product? How would we sell it?"

    The marketing people in the room said, "Whenever you are trying to sell a product, you begin to say what differentiates your product from other products on the market." So we began to catalog what differentiated the experience of working at Southwest. Before we knew it, we had these eight symbols of freedom that you had from working at Southwest. That became our internal brand.

    WM: Can you give me an example?

    Sartain: We had the freedom to learn and grow. The freedom to create financial security. The freedom to work hard and have fun—that was our answer to work/life balance.

    Then we created an overall employee brand: "At Southwest, freedom begins with me." We made that connection that you’re delivering the freedom that Southwest delivers—you, the employee—and in turn you get these freedoms from working here.

    I began to say, "This is magic." Suddenly I wasn’t talking about, "Oh, I need to get $200,000 to do a new benefits booklet." I was saying, "We need to help our employees understand their freedom to pursue good health. So in order for them to have their freedom to support our brand, we need to do a new benefits booklet for $200,000." It was a different conversation. And it stuck.

    WM: How was Yahoo different from Southwest and Mary Kay?

    Sartain: I always saw more similarities than difference. One of the reasons it appealed to me was it had two founders still involved. I had the Mary Kay founder, I had the Herb Kelleher founder. Now I had Jerry (Yang) and David (Filo), still there every single day. They weren’t just like, "Hi, I’m a billionaire. I’m breezing in." They were in their cubes working their butts off next to everybody else.

    The age of Yahoo employees was very similar to the age of Southwest employees. A lot of young people. Lots and lots of 20-somethings.

    What was really different is the workers themselves. Southwest primarily has people who are high school grads, who are very career-oriented, who are joining to be part of something bigger than themselves. Yahoo had a lot of very brilliant people. They were all the top in their class, they never got below an A. But there was a lot more competition to get ahead. And a lot more, "We all have an idea, and ours is best."

    There was a very collaborative atmosphere. But sometimes things didn’t move forward as fast as you wanted it to, because more brilliant people would have more brilliant ideas about how to make something even better than it was before.

    WM: That’s a refreshing comment. You often hear these Silicon Valley companies only talk about the collaboration and the harmoniousness.

    Sartain: At Southwest there was a healthy respect for authority. If Herb said, "I made this decision, we’re going to do it," then everybody kind of fell in line and got it done. [Former Yahoo CEO] Terry Semel could stand up in front of the whole company and say, "I made this decision, we’re going to do it," and everybody would say, "Oh, bad decision. No, we’re not going to do that. Oh, he came from the media business, what does he know?" You just don’t make a decision and announce it and think everyone will fall in line. That was the challenge: You have to win over the minds and the hearts. Whereas at Southwest it would be the hearts first and then the minds, at Yahoo you would have to make an intellectual argument sophisticated enough to win them over.

    WM: Do you see a different attitude toward layoffs by employees? Are they not as big of a deal anymore?

    Sartain: I really think the Silicon Valley is different from the rest of the world. In the Silicon Valley, people almost expect to be laid off at some point. I’ve been involved in two major layoffs at Yahoo: one when I first got there and one as I was leaving. Some people were happy to be laid off—they were ready for a change, they wanted a package. Most people weren’t devastated. Most people knew that they would go on and get another job. There’s probably very few people in the Silicon Valley who haven’t been laid off once, or their spouse laid off once.

    But when you go to the rest of the country, I saw people did really want to join a company and stay for their career.

    The best companies get to situations because of disruption and change that cause them to have to make that business decision to lay off. It’s unfortunate. I wish there were a way around it.

    WM: What are the biggest challenges these days for HR leaders?

    Sartain: I think the talent marketplace in the last two or three years has changed so dramatically that almost everything we do in HR has got to change with it. The evolution of the Internet, social media, the global economy, the Gen Y generation coming of age as the baby boomer generation is leaving creates a situation where you can no longer just think that you can have an opening, and recruit for the opening and get an employee.

    The company used to be in the driver’s seat: "Here’s the job I have. Here’s how much I want to pay you to do this work. Come to work for me under my terms as the employer."

    I think those days are fading. I think it will evolve almost to the point that you have a marketplace like eBay where someone will put themselves out to bid: "Here I am. Here’s what I’m willing to do for how much money I’m willing to make. And here’s my hours and my location and what I can do for you." It’s going to be that person in the driver’s seat.

    And that person may be a Gen Y person or a baby boomer looking for a little more flexibility in their lifestyle. I think employers are going to have to learn how to have this individual work arrangement with each employee in certain aspects of the talent. I’m not saying that’s going to be the case for retail jobs or volume hiring positions. But it’s going to be the case for some of your top talent or some of your core talent in certain industries. It’s beginning to happen. The Silicon Valley is probably where we see a lot of it. But it’s going to sweep the country.

Workforce Management, May 19, 2008, p. 1, 18-21 -- Subscribe Now!