Arte Nathan is a veteran in the human resources industry. With more than 30 years in high level human resources positions including serving as the CHRO of Wynn Resorts and the Vice President of HR at Mirage Resorts.
As the president and Chief Operating Officer of Strategic Development Worldwide, a business consulting firm, Arte helps companies overcome challenges in staffing and operations by getting to the core of what they need. More often than not, that’s learning how to inspire, engage and motivate their employees.
In this episode of The Benifit, host Kate King chats with Arte about the evolution of HR responsibilities and thought. Arte shares stories from his life and career in a candid, fun conversation. You’ll want to listen to every second of this episode!
The Benifit is a podcast that demonstrates that when humans thrive, companies prosper. Kate interviews executives from some of the world’s most innovative companies for insights into how they enable their employees to thrive.
[01:20] Arte talks about why it’s important people are comfortable in the workplace
[03:10] Arte shares what led to his epiphany that people need to be rewarded and recognized for what they do right.
[06:38] Arte talks about why it’s important to tell employees WHY they should do something
[13:11] Arte gives his rundown of the most important benefits employers should provide
[13:25] “I think employers have to help employees get the stuff that they need to live their lives the way they want.”
[15:22] Arte explains why he thinks employers should provide and support education for their employees
[17:10] Arte talks about why it’s an employers job to mold employees into good workers
[18:08] “Everybody’s skills can be developed if they have the right attitude.”
[18:30] Arte talks about why he hires people with criminal backgrounds
[19:20] “I think you have to look for people that are underemployed and make yourself attractive enough that they will pick up more employment with you.”
[21:50] “People from all backgrounds in all situations appreciate a chance.”
[22:11] Arte shares the three truths he lives by
[23:25] Arte talks about keeping a positive attitude
[27:00] Arte shares about his personal practice of writing out quotes and mantras
[31:14] Arte says his brand of HR can be summed up in the word inspirational
The Benifit Interview with Arte Nathan, Former CHRO of Wynn Resorts and President of Strategic Development Worldwide
[00:00:05] Kate King: Hi, this is Kate King, host of The Benefit, where every episode we dive in and explore companies and how they enable employees to thrive. I am joined today by Arte Nathan. He’s the founder of The Art of Motivation, and a former SVP and Chief HR officer at Wynn Resorts and a TEDx speaker. He discusses hiring for attitude and then training for skill, enabling second chances, and has an incredibly inspiring morning routine.
First, we thank you and welcome, Arte, for joining me today. I’m going to start with a quote by Steve Wynn who said, “Treat people right and your short, medium and long-term talent issues will resolve themselves.” A key challenge for companies that we partner with is the acquisition and retention of key talent. What, in your opinion, do companies need to do to enable people to thrive and actually stay in a company?
[00:01:04] Arte Nathan: I think you have to treat them with respect. I think you have to create an environment of trust, and I think you have to make them very comfortable with who they are, and where they are.
[00:01:16] Kate: Okay, tell me a bit more about that; who they are and where they are. I love that piece.
[00:01:20] Arte: Early on, we had to decide what we were looking for in our employees and it wasn’t obvious back in the 1980s because no one was really talking about these things or researching them. But over a couple of years, we came up with this idea that we would hire for attitude and train for skill. Once we figured that out, we had to define what those attitudes were and how to find them or, at least, how to spot them. We came up with this idea that we wanted people that were generally optimistic. Earlier on, we defined it as people who liked being interrupted and were good with an interruption and would smile their way through it.
But that just meant that those people were comfortable with themselves, comfortable with their environment, liked who they worked for, and were able to then bring that personality to the fore. People who are scared where they work, people who are uncomfortable or not aware of what all they have to do can’t get comfortable, and if they’re not comfortable, they can’t be confident. All of those things went into building a culture at Wynn that made people believe that this was a good place to work, so they were going to make a good commitment to it. That makes sense?
[00:02:45] Kate: Yes, absolutely. I love that because it’s only now I start to see a lot of companies start talking about purpose and what they want from people. Typically, I’ve always gone to resume and skillset versus that intrinsic value of who are you coming to it, what are you about, and then, “Okay, we can train for skills.” I love that. Go ahead.
[00:03:10] Arte: The skills within that they bring with them, that’s of interest but secondarily, because most good companies will teach you what they want you to do and how to do it. That’s just common sense. People want to be told what’s this all about and once they understand that — once they have the context, I think that they will get comfortable and work harder. We have this notion– I said this back in 1989, that employee satisfaction was linked to customer satisfaction which was linked to profitability. If you believe that, then you would put all of your efforts into employee satisfaction and the rest would take care of itself as Steve said.
We’ve made a lot of deposit into our employee relations account over the years, some in terms of policy, some in terms of benefits, some in terms of behaviors. And all told, those were the things that made people want to stay with us. I did a research project back in the mid ’80s of why people left our original company, The Golden Nugget. We found out that there was, at that time, a high turnover among guestroom attendants, the people that cleaned the rooms.
When I asked about a hundred of them why they left, they basically said, “Look, you’re very good at catching us when we do wrong, but how about if you catch us when we do things right?” That was one of those epiphanies that changed our entire philosophy. Because prior that, we were writing people up and trying to change their behaviors that way when, in fact, the best way to do that is what you learn in Psychology 101, which is the behaviors you want repeated, just pay attention to that and people will repeat those.
We started catching people doing things right. We expanded that from housekeeping to the rest of the company. It literally changed the way we did business. Now, you go back to things that Steve Wynn said over the years when he hired me and for several years after that, he said, “HR is not a department; it is the department.” It is the way that we do business. And all of us have to understand that and buy into those concepts.
I was just a facilitator rather than some HR guy standing on the sidelines shouting policies. Our managers got into it. As our turnover went down, our employee morale, and productivity, and satisfaction went up, and our customer satisfaction went through the roof. That’s when we opened Mirage and we were off to the races at that point.
[00:06:08] Kate: Fantastic. There’s two great examples, I think, of probably pioneer thinking. If you think, today, they’re coming out with books around focus on your strengths, really focus on everybody, what they’re doing well not what they’re doing badly. That’s what, early 2000s, everybody was talking about that, not really back in the ’80s, so that’s really a pioneer thinking of bringing employee and customer voice together. I think that’s a fantastic example of people thriving.
[00:06:38] Arte: Let me add one more thing. There were two key things that we did policy-wise or philosophy-wise. This catching people doing things right was one; but the second one was just as impactful. Steve Wynn one day said, “I think employees want to know why.” If people know why, basically, they understand the context of things, then they can make up their minds whether to do it or not. But if you just tell them to do things like a parent telling their kids to, “Clean your room,” and they say, “Why?”, and you say, “Because I’m your parent and I said so.” Well, it didn’t work there and it doesn’t work in the workplace either.
In 19, I think it was ’91 or ’92, we implemented a policy that managers had to explain why whenever they get a directive or said something. If they couldn’t or wouldn’t, he told employees they could just say no. It turned into what was just going to be planned insubordination. Well no, it forced managers to think, and to plan, and to articulate, and then to listen, and then to resolve; all those things you want managers to do.
Now, many companies, we were one of them, we tried to teach all those things but nobody understood why I had to communicate well, or I had to listen well, or I had to resolve things well. Well, just by saying, “Look, we’re going to explain why,” and, “This is how it works,” our managers, who were a little concerned at first, found out that employees weren’t insubordinate. They were, in fact, more understanding and they, in fact, got more comfortable.
What that resulted in is that people felt that we were fair. Now between catching them doing things right and explaining why they thought we were a very fair management team, and thus, they trusted us. If they trusted us, there was a degree of mutual respect that allowed everything to work well. I wish it was more complicated than that but it isn’t. It is just that simple and all companies can do it. Whether they want to, whether they will back it up with their actions is another thing altogether.
But it’s not something you have to buy a management application. It’s not something you have to do a great deal of training. It’s just something that works because that’s how people like to interact with one another.
[00:09:11] Kate: How long did it take for managers to go through that change, because that’s a real change for managers in themselves, right?
[00:09:19] Arte: Yes. Each of those two things took us approximately a year to work through. Now, we were a growing company. A lot of people were joining us brand new, hence, they were bringing their habits and practices from other places. It took a long time to get around to everybody. It wasn’t a heavy-handed thing. It was Mr. Wynn and a bunch of us saying, “This really works. We’ll practice this with you and you can practice this with others.”
It turned out to be so successful that by 1992, we were recognized on that Forbes list is the second most popular company to work for. There was all kinds of good things going on. But for us, it was all about if we reduced turnover, then we increased people’s understanding of our business and our customers and they would become more productive and the business will do well all the way around. Steve Wynn was right. For a guy like me to have that kind of support, it made HR a pleasure.
[00:10:30] Kate: Fantastic, thank you. One of the things you mentioned about HR being “the people”, being “the department”, we hear a lot now that HR is really going away. That the HR function has lost its way. What does an HR person do? Do they just enforce policy? I think in your examples, you’ve used that ready HR is meant to light the way, to really enable people to tune in to their purpose, to their being empowered in the work place. If you’re dealing with say a CEO or you’re talking to a CEO about the role of HR, what would you say to that?
[00:11:12] Arte: HR has to be the way that all of the managers do business. You should delegate all of the authority, and responsibility, and accountability to managers because they’re the ones on the floor on the firing line, they’re the ones that know the nuances of things that they’re dealing with. HR cannot know that. HR is only good at building tools and teaching people how to use them. Then monitoring their use and helping people to improve if they’re not maximizing the utility.
HR can’t make a decision anywhere. They can’t hire anybody, they can’t fire anybody, they can’t put them out or bring them back for more grief, and they certainly can’t motivate them. All that goes on between the employee and their direct manager or supervisor. If that relationship is good, and it has to be good, then all good things flow from it because management can’t get between the employee and the manager, just like management can’t get between the employee and a customer.
At those moments, those individuals have to be inspired, and motivated, and knowledgeable, and competent, and then they do good work. I spent my entire career delegating HR responsibilities to line management. Of course, I had to train them, I had to build the tools, I had to show them how to do it, I had to monitor, I had to catch them when they did it right and congratulate them with all kinds of awards, and I had to cautiously and quietly coach them to be better when they were not using them effectively.
[00:12:59] Kate: Fantastic, thank you. Arte, we’re going to switch gears a bit if that’s okay. In your TEDx talk you mentioned that a good deed is in its own reward because if you can you absolutely should, and I really loved to that saying, “If you can, you should do it.” What’s the rundown of benefits that companies should offer their employees with that mindset?
[00:13:23] Arte: Well, there’re two kind of benefits. There are resource benefits that we’ve been talking about and there are the other benefits that people work to an employer to provide. Whether their insurance, or time off, or education, those kinds of things. I think employers have to help employees get the stuff that they need to work their lives the way they want. In some cases, that is just being satisfied with themselves and comfortable with what they’re doing. That’s the soft stuff. The benefits– employers incident after the Second World War have been– they’ve been the ones having to flip the bill and provide insurance benefits.
It’s awkward because they’re not portable, so we create this thing called Cobra, which is not permanent, and so employees are always worried because I think insurance benefits anyways are almost as important as wages in many cases. Employees have to know that those things are available. But I think, some time, hopefully in the near future, we’ll figure this out by having a single player organization in America that will provide benefits and take that off the table because employers competing on benefits, it’s not fair. Either they have or don’t have the money, in one way, they’re okay, in the other way they’re not, and that’s not fair to the employee, the employer, or the customers.
So I think that government, as long as we’re talking about health care reform, ought to really take the time to figure this out. I think that’s a benefit that absolutely is necessary but I’m not sure it’s an employer-necessary thing just because we’ve always done it their way. The other benefit I think the employers should provide for people is education. They need to know how to do what they need to do and that’s a pretty simple education proposition and employers should be somehow motivated and incented to do that, they’re not right now.
So I think education is something that employers have to provide and make sure that people have enough to do what they need to do and have enough to get ahead if they’re interested in that. So I think motivating employers to provide those things is important. I also think that employers have to provide opportunities to the people that they have. And I’m not sure that promotion policies in all companies really respect and understand that. The two go hand in hand, education and promotions. Those two policies are critical, those two benefits are critical to creating a workforce that is confident, and competent, and happy to be where they are.
[00:16:40] Kate: The base one, health, then education, and then looking for that empowerment or growth are the key benefits you would look to?
[00:16:49] Arte: Yes. Yet to work with your management, they have to understand the benefits of doing this. There is this notion that there’s a award for talent. If I ask managers, and I do this all the time, what’s your number one problem? They always say I can’t find good health. Well, the problem is they don’t know what good health looks like and they don’t know what they have to do to develop people into being good employees.
It’s not a passive thing. It’s not I pay you and you should be good. It is I do a lot of things that create an environment where you want to be good and you, in fact, are good. It’s not a simple thing but it’s not rocket science either. If it was, I could charge you a lot more for my consulting [unintelligible 00:17:36].
[00:17:36] Kate: Absolutely, so just going back to that, I’m sitting down with you and you say yes, I say to you I can’t find help. What do you say in that situation?
[00:17:49] Arte: The first thing I say, “What are you looking for in the next person you hire?” If you really probe for a little bit and deeply, most managers will say, “I’m looking for somebody that will come to work.” First and foremost, I need somebody to come to work and then I need him to work hard and care a lot. What’s that got to do with the skills that you tell me that you’re looking for? The fact of the matter is that everybody’s skills can be developed if they had the right attitude. So I say, look for attitude, don’t look for skills, and you will start to find that the applicant pool, all of a sudden, got richer.
You said you watch my TED talk, you got to go fishing where applicants are [unintelligible 00:18:33], the unemployment rate drops in America, which it has over the last 18 months, people are frightened that there’s nobody out there but while you’re looking out, as you saw, I made an interesting career out of hiring people with criminal backgrounds. People that others had left behind because we have background checks and we normally don’t accept people like that, but people who have earned the right to a second chance and want their second chance, absolutely, will do everything in their power to make the most of it. And so they come to work every day, they’ll never take a day off, they’ll never say no, they’ll never do anything to risk their freedom ever again.
Those kinds and there’s hundreds of thousands of people who get out of jail every year that could realistically go into this applicant pool. I think that you have to look for people who are underemployed and make yourselves attractive enough that they will pick up more employment with you. I think we have to absolutely go back and look at the retirees, The Graying of America symptom– people are living into their 80’s, they don’t want to retire when they’re 60. People like me don’t mind working for a longer period of time.
But in the ’60s, when they passed all the anti-discrimination legislation, the most important one was age discrimination because it is still the most common litigation in America that people feel that they’ve been discriminated against because of their age. Almost all the other things have been worked out. But we got to get over this age thing that the youth are the only way to the future. Now, interestingly, there’s more millennials than baby boomers today. But millennials and traditionals have a lot of the same attitudes and maybe we should start looking at both groups with a greater interest in making sure that we put most of them to work.
There’s no reason to be afraid of people who are millennials and there’s no reason to be afraid of people who are old, older or retired. But we have stereotypes in our heads and we got to get over those things. When people say they can’t find good help, they get through with me, they know that there’s a lot of good help out there and they can take advantage of them. But frankly, that’s almost the basis of what I do with employers today.
[00:21:15] Kate: Yes, I know. Listening to a TEDx talk, I think taking our hats off to Tony, Hosey, Donald, and Derek. I think they were great, great stories of that second chance and really coming in every day not missing that day of work. Really engaged them purposeful about the opportunity they had on the company they were working for and also a lot of gratefulness, I think, in the stories that you were telling on both sides.
[00:21:44] Arte: I laughed about that talk because I chose 4 out of, maybe, 4,000 that I have. They all fit into that same genre of “give somebody a chance”. People from all backgrounds, in all situations appreciate a chance. It’s not a big deal to do it, but surprisingly so, few do it. I don’t know.
[00:22:12] Kate: Yes, but thank you very much. I have two questions if you have time and this is switching gear more to–
[00:22:17] Arte: I do.
[00:22:18] Kate: – thank you. This is switching gear more to you. And that is, can you tell us the three truths that you live by?
[00:22:26] Arte: Help others and you’ll help yourselves. I mentioned that in the TED talk. Helping others is– as kids growing up, we wanted in our religious studies, and I learned it in the ’60s, it is so important to help others, it’s so important to give back every opportunity that you can. That’s one truth and it’s all wrapped up in that. The second is do good work. We have options all the time. Everything, every moment, every day, there’s an option. We can get into it or not.
And I think doing good work, being engaged, being positive is so important. Most of us suffering from the depression of one sort or another, but it can be worked through if you can get and keep a positive attitude. That’s the second thing I live by and maybe it’s the second and third because keeping a good attitude, it’s so hard.
The news that we read, the things that we see all the time get us down and yet somehow we got to pick ourselves back up and others can help but unless we initiate that. It is not going to work unless we believe in that, it won’t happen. Being self-motivated is so important.
People used to come and– everybody wanted to come to Steve Wynn’s properties and get a tour. I used to be the guy who gave the tour of the back of the house and everybody said, “Boy, you’re so happy, you’re so positive.” There were days I wanted to kill myself. There were days that it was hard to get out of bed, there were days that the pressures seemed insurmountable. But if you just stop and think how lucky we are and the great — I guess it’s this glass is half full not half empty. And maybe that’s the third thing. You got to see it that way.
People say, “I’m sick and tired of your happy attitude.” I don’t know any other way. I can’t get through the day if I don’t start with that and try to maintain that and go to bed with that. It’s just– life is tough. Work is tough. Everything’s tough, but so what. What’s the alternative [laughs]? That’s what I say. Does that answer your question?
[00:25:12] Kate: Yes it does. Thank you very much. I have one last one for you, if that’s okay. We hear a lot about morning routines and what people do first thing in the morning, sets them up for their day. I ask this question because I’m always intrigued by, do people really do the morning routines that you hear about over social media today? I always ask my guests, because I’m always intrigued by their morning routine, as to what they do when they first wake up.
[00:25:46] Arte: This is interesting. Nine years ago, I had a client who I worked with to develop their mission, and their vision, and their values. We came up with ten values. Teamwork, professionalism, there’s ten of them. We came up with this idea that we would have pre-shift meetings everyday with every employee.
Part of those meetings would be spent on just talking a little bit about, what’s our values? What can we do with our value today that will make what we do a little bit better. It sounded like an interesting idea. The clients said to me can you write a little something that we could use in our pre-shift meetings. This was nine years ago. What I would do is I would take one of the values and I would look up a quote that generally applied to that value. I would write 200 words about what I believed in or what I had done in the past that helped me to use that value to be better that day or that year, that week, whatever. I wrote these, and that assignment went on for a couple of years.
That assignment ended but I was in there everyday writing these statements, getting these quotes and writing these statements. I started publishing them. What they turned out to be for me was a morning meditation. Now what I would do is, at night, I would go get the quote. I would have a value in my mind and I’d get a quote. I would quick write 200 words about that quote and I would write it. It’d take me about 20 minutes.
The next morning at 5:30, I would get up, and I would read that quote, and I would read what I wrote. I would edit it a little bit, but that would be my mantra for today. Nine years later, I’m still writing them. I can’t get away from them because I can’t start my day without this personal affirmation of thinking about good things and trying to remember to do good things and suggesting some good things to others.
Now, I walk a lot. I walk five or six miles a day. I like to do that in the morning, but I can’t walk until I have finished and sent this quote to– right now, it goes to over 18,000 people. I can’t get away from it. People write to me all the time, “Could you put my friend on,” “Could you add somebody else I know,” or, “Could I get on.” There are days that, “Should I do it?” But if I don’t do it, I’m like a half a guy walking around that day.
It’s funny you ask what do you do. Many people meditate. Many people will go to church or synagogue and pray. A lot of people will exercise, but all of those things have to do with putting something up here. You know thinking about something. Can I do that, or is that important, or how should I be?
If we’re not reaffirming our values everyday, if we’re not making and remaking a commitment to those values everyday, what if we lose them? What if we somehow find that someday we don’t have any values? That scares the heck out of me. I’m stuck doing these things everyday. You send me your email address, I’ll send you these. You won’t believe it.
I see people all the time, all around the world who say thank you for this. They start repeating my stories, and I’ve got some crazy stories of the things I’ve done. Things that I’ve seen and things that I’ve experienced. That’s what I write about. This week, my quotes were about passion, last week was professionalism, next week is pride, before professionalism was ownership and responsibility, then it goes back to teamwork, and excellence, and creativity. It’s crazy, and I’ll probably do these until I die.
[00:30:15] Kate: I love it, I really love it, I think that’s very inspirational. Do you notice a difference between pre-nine-years of doing it and post with it?
[00:30:24] Arte: Yes. In some ways, people say, “Well, you’re full of it,” this is a [unintelligible 00:30:32] because I’m also a preacher. I’ll tell you one last story, when I got out of college, I wanted to go to grad school, my mother and father wanted me to o to law school, I wanted to become a rabbi. I applied to the seminary, I got in, and I got into law school. The head of the seminary talked me out of it on the premise that you have to be religious to become a rabbi. I just wanted to do good work and he said, “Why don’t you become a social worker?”
Anyway, I went to law school, I didn’t like it, I quit, and I became an HR guy, full time, and HR is the middle between the law and the [unintelligible 00:31:10]. It’s so funny that my whole life has been balanced on these two ideas that I had years ago. I guess I do this because it’s part of what’s inside of me, it’s my DNA. Somebody once asked me, “What’s one word that you can say that defines your brand of HR?” I said inspirational, and I really believe that. Steve Wynn allowed me to do a lot of good work and to inspire a lot of people to think to do the same, and because of that, it was a great career.
[00:31:50] Kate: Arte, thank you so very much. I know we’re over time, I really appreciate spending this time with you today, what a magical morning routine. I’m definitely going to sign up and have our listeners, of course, have the opportunity to sign up to. But thank you very much indeed for your time.
[00:32:08] Arte: Thank you, I appreciate it.
[00:32:14] Kate: Firstly, thanks for listening and spending time with us today, I hope you enjoyed the interview with Arte. For a transcribed version of this show, head over to benifit/podcast B-E-N-I.F-I-T/podcast. This is the stir of conversations that begin to identify the best practices of when human thrived companies prosper. If you would like to recommend anyone for the show, please email me at [email protected], [email protected]
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