Forum Topics Employee reviews
Alpha18
3 years ago

Do people use employee review sites such as Glassdoor, Indeed and Seek when looking into a company? It’s something I’m unsure about, does it give a good view of company culture or provide a misleading narrative due to disgruntled ex-exployees leaving 1 star reviews or current management leaving fake 5 star reviews? If it is an accurate representation, is it a dealbreaker if a company has a low score? The question assumes there’s a reasonable sample size of reviews (100+ at minimum). Really interested to get people’s thoughts.

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Nnyck777
3 years ago

Hi @Alpha18 I agree they can be skewed and pretty useless if there aren’t many reviews. I think it’s a good point made by Owen Rask to watch the 2-4 ratings a bit more closely. Check for common themes in responses.

It can be a handy first pass filter. Over the years I have tried to track down employees or competitors and pick their brains (also a helpful exercise). If there are lots of reviews and low ratings it raises an orange flag for me. I think the old saying ‘from the head rots the fish’ is a useful one.

I find myself using that expression a lot. I consult in many business settings and the hairs on the back of my neck stand up when I enter some practices. I find good culture in workplace always seems to be linked to more successful higher yielding businesses in my industry.

High employee turnover is always concerning - something is going wrong if a company can’t retain its workers. Even if the company is making money perhaps they could be shooting the lights out if they looked after their staff.

A friend of mine who was a Director of a childcare center gave me some great advice when I became a mum. When looking for a sign of a good childcare centre you only really need to know one thing…what is the staff turnover like. I find myself asking that question in the practices I visit too. I guess that is what Glassdoor, Seek, LinkedIn can provide a slight view through the looking glass.

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reddogaustin
3 years ago

@Alpha18

I use them as a tool. No one tool provides a full picture. It is the combination of tools that get a job done.

You are aware of the potential for bias which is the risk here, so I think you'd get value out of this tool in your toolset.

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Rocket6
3 years ago

Great post @Alpha18. I share similar views to the other comments - useful but noting the limitations of some of the sites we might try and use as investors.

I'm a BIG fan of culture and any clues I can get that might provide insight into what's going on under the hood. Anything that might help me get a leg up re: better understanding the company I will typically try and explore. I am no expert by any means - but think the culture side of things is often put to the side as trivial or not so relevant, when in fact it should be a top 2 or 3 consideration, particularly with microcaps.

I use Glassdoor but I don't normally take too much notice of it. I do however look for lots of five star reviews in a short time frame (a sign the business might be trying to enhance its reputation by asking staff to leave positive reviews). Nuix is the one that comes to mind, it was clear they were doing this when they were pushing shit up hill last year. It also helped that they were outed by a specific individual who indicated they were doing just that, but the signs were clear. In addition, a few isolated one star reviews are normally a good way for an annoyed ex staff member to feel better after their employment didn't work out, so I don't normally take too much notice of these either. That said, anything that might provide insights and I am all ears.

I find Seek, LinkedIn etc can be valuable for tracking staff hiring - both as a vetting mechanism but also keeping in the loop with companies I hold. Given the familiarity we might have with our holdings, I think we should gain some valuable clues re: trends or any patterns in recruitment. It might reveal expansion underway but also might reveal issues at particular sites - eg staff turnover due to asshole manager. Regular job advertisements and/or issues filling a position might also be an indicator of poor culture, company reputation or more broader issues with skill shortages.

The best example for me at the moment is two of my larger holdings (ABB and PLY) are both expanding to new states across Australia. I am keeping tabs on job advertisements and how long these remain up for any clues I can glean.

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AlphaAngle
3 years ago

100% can be useful I remember with one market (OMN) there was a review that basically said the company was a big cash pile with a bunch of employees with no idea what to do. - turned out to be exactly right.

Also having read bad blood I remember glass door may have been the most assessable public information directly contradicting the narrative.

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