My partners and I recently devoted our weekly meeting to discussing an issue we encountered with our upcoming learning event for local owners: Building a Team of High Performers.
We believed this would be an important topic for the start of 2011 for 2 reasons. First, every company that we have met that has a cash flow problem or was unsatisfied with their growth or profits also had a people problem. Growth problems attributable to bad strategy are also people problems because companies that choose the right people (including advisors, consultants, and coaches) are less likely to have strategy problems. 2) The people problems were self-inflicted.
We were having trouble filling the learning event. This was stunning to us, given that the last two learning events each included C-level executives from over 100 companies. Both events were highly rated, and thus we expected to have a good following. What we had to figure out was why people were not signing up. Our combined work has spanned hundreds of companies, and we have yet to meet a company that could demonstrate that at least 50% of their employees were “A Players” – most have 25% or less. Research shows that replacing even one “B” or “C” player with an “A Player” has a big impact on a person’s business. Anyone you ask would agree. So what was the problem?
Our research indicated that people were not signing up for the same reasons that they had a low percentage of high performers. While most executives will give lip service to the need for finding, getting, and keeping high performers, they are not willing to commit to that goal. They are not willing to make their goal an organization-wide mandate! They like the concept, but they make only minimal efforts toward implementing it.
Just as we do with our healthcare system, we spend a lot more money to deal with the illnesses we know can be prevented than we do to prevent them from occurring. The costs of mis-hiring, promoting the wrong people, and not removing poor performers is far more than the cost of finding the right person. However, people do not put maximum effort into finding the right person and making it mandatory to have a top performer in every seat.
The most important issue we found as to why people did not sign up was their illusion that everything was fine. Too many companies have not created key performance indicators for every position in their company. Some have created indicators, but do not hold their people accountable. Not having or ignoring performance indicators leaves no way to know for certain whether you have “A,” “B” or “C” players at work. As a result, performance ratings are based on how the evaluator feels about the subject. Typically what happens is that people who are a good cultural fit and communicate well are considered “A Players.” Their actual performance could be horrible, but that goes unnoticed.
Recently I asked the CEO of a bank to attend our workshop. He said there was no need because 100% of his employees were “A Players.” I asked him how he knew this and he said it was the discipline that they had put into their culture over the last 25 years. My observation of the performance of some of his “A Players” in a membership organization we all belonged to rates them as less than stellar. In the last 12 months their “A Players” missed 3 deals (that I know of) that were right in front of them. Their bank never even had a chance to get the business because their people did not do a good job of getting in front of the prospects the way members from other banks did. Ironically, the CEO recently stopped his firm’s involvement in the organization because he deemed it a bad investment. What he did not realize was the bad investment was his people and not the organization.
Another issue is misunderstanding of what would happen if a company made the commitment to do what it takes to put top performers in every position in their company. Some of these include:
- There are not enough “A Players” out there.
- It will take much longer to hire people.
- It is too complicated.
- It takes too much manpower.
- It can’t happen in our industry.
- It is too costly.
These are all myths. Building a high-performance organization can be achieved and learned by any company. When implemented properly it saves time and money. People are already spending time interviewing candidates and just need to learn the right techniques and processes to determine whether people they interview are the right choices for the positions. The real challenge is having an organization-wide commitment to a high-performance standard, and practice makes perfect.
Howard Shore is a business growth expert that works with companies and people that want to maximize their growth potential by improving strategy, enhancing their knowledge, and improving motivation. To learn more about him or his firm please contact Howard Shore at (305) 722-7213 or [email protected].