One good way to stay in touch with your market is to hire peoplewho like your product

You've heard it, maybe even seen it before. On the job, people who like what they do usually perform better than those who don't. They work harder, learn faster, and are more resourceful about how they approach even routine work.

So where do you find these people? Well, one good way is to target individuals who already know something about what you do -- and who like it. Princeton Review founder and chief executive officer John Katzman has found that the best source of employees for his company, which runs courses to help high-school and college students prepare for standardized tests, is his former customers.

Almost all of The Princeton Review's part-time people are former customers. One hundred and fifty high-school and college students work afternoons and weekends; some of the best of them come back to work for the company full-time after college. By hiring people who understand his service as consumers, Katzman says, he doesn't have to invest as much in training as he otherwise might. What's more, since his employees are part of his market, they can suggest new ways to cater to customer needs.

Katzman, a 30-year-old Princeton graduate, began hiring former customers shortly after he started The Princeton Review in 1981. To keep the company going while he was tied up pitching his business to school guidance counselors, he needed backup. Fortunately, a few students who had taken his SAT-preparation course offered to help out. For $5 an hour, they were willing to do odd jobs in and out of the office.

By fall 1985 the New York City-based Princeton Review was offering courses in six cities, generating around $1 million in revenues, and beginning to sell franchises. Katzman, who was working seven days a week, felt it was time to become more professional. In the space of a few months, he brought in four staff people: a controller, two program directors, and a receptionist, and he phased out the part-timers. True, he paid the new employees a lot more than he had paid the students. But given the demands of growth, he thought he had no alternative.

Once he made these changes, some things at The Princeton Review improved. Katzman liked having more time to focus on opening new offices and franchising. And without a bunch of students milling around, the office was quieter and more businesslike. But as the months went by, he realized that he had lost something, too. His new employees were less interested in the problems of his 16-and 17-year-old customers than their predecessors had been. They quickly tired of such routine jobs as stuffing envelopes. Katzman decided to rethink the way he organized the business. Certain jobs -- in finance, for example -- required full-time, experienced people, but others could be handled just as well, often better, by high-school students who liked working and who knew his business.

Today Katzman can't imagine how his company would operate in a more traditional fashion. His corporate staff and six company-owned offices comprise about 45 full-time people. But there's also the 150 part-time high-school and college students, known within the company as deweys. The deweys (named for characters in the book Sula by Toni Morrison) work 10 to 30 hours a week at $6 an hour, doing office work and assisting at course sites.

Finding students who are interested in working as deweys hasn't been a problem. A few weeks after a test-preparation course is completed, The Princeton Review sends out a final course evaluation to everyone who enrolled. Among other things, it asks students if they're interested in becoming deweys. Those who say yes are invited to attend a meeting where they hear specifics. From the pool of attendees, the program directors select the best candidates.

While different offices use deweys in different ways, the idea is more or less the same throughout the company. "The role of deweys is to fill in the gaps," Katzman says. When courses are in session, deweys are assigned to help instructors in classrooms. Several nights a month, deweys are asked to work late to grade practice tests. Most seem to like it. "They'll sit on the floor and work until 3:00 a.m.," Katzman says. The company supplies the pizza or Chinese food, and the work gets done.

Staffing a company with customers has its challenges. In addition to recruiting them, you need to find a way to manage them. Katzman says that, despite their enthusiasm, high-school students require lots of supervision. "If you don't give them specific projects to work on, they'll sit around drinking our soda." Then, too, there's the issue of continuity. When deweys graduate, they're off to college, which means that The Princeton Review has to replace them.

But the way Katzman sees it, the gains in having employees who know the market far outweigh any inefficiencies. What's more, the relationships with deweys often extend beyond high school. Some ex-deweys work for Princeton Review offices in other cities, Katzman notes, while others come back during summer vacations.

And as the company grows, the former deweys provide a steady source of candidates for full-time positions. (Katzman cultivates this by sending them letters describing available positions.) According to Katzman's count, 7 of the company's 30 staff people in New York cut their teeth with the company as deweys, and 6 of the franchisees started this way. "In a way," he says, "we've set up a career path for people who like what we do."


Why customers may be your star employees

Pay people enough, and you'll almost always fill jobs. But will they care about your business? John Katzman, chief executive officer of The Princeton Review, discovered that satisfied customers can make great employees. Here's why they may be a better bet than candidates off the street:

* You already know who they are. No matter how you interact with customers, having been exposed to them gives you a potential edge in searching for employees. Rather than shelling out for help-wanted advertisements, Katzman sends out targeted mailings every few months to recent customers telling them about job opportunities.

* They know what you do. Since you're not dealing with the hoi polloi, you don't need to do a lot of explaining about what your business does and why it exists. As buyers of your products or services, your customers know.

* They like what you offer. By inviting customers to consider your company as a place to work, you'll screen out the people who are lukewarm on your business. Katzman has found that ex-customers who are interested are usually fans of The Princeton Review.

* They can lead you to other customers. Even when the jobs aren't sales or marketing oriented, enthusiastic people can help you generate interest among your target market. Few of The Princeton Review's deweys, for example, are involved in marketing, but they interact daily with classmates. "We think of them," notes Katzman, "as walking advertisements for what we do."