As editor of a magazine, I once had a problem with a young sub-editor. I thought she was sulky and lazy, and I turned down her request to become a writer – in effect a promotion. I reckoned my predecessor had appointed her for her looks rather than for her brains.
When I left, my successor promptly reversed the decision – and energised by her new job she became a star, ending up on a national where, exquisitely, she later commissioned me to write a couple of pieces for the business section.
That experience taught me a lot about the power of context and expectation, later backed up by impeccable academic research: although some human capacities are fixed (most people will never play football as well as Cesc Fabregas or invent the theory or relativity), many others aren’t. Generally speaking, if you expect people to do something well, they will do better than if you expect them to do badly – and that includes physical as well as mental attributes. Other evidence shows that only a tiny proportion of performance (Deming put it at 5 per cent) is dependent on the person alone, compared with 95 per cent on the system they are working in – and over which mostly they have no control, except to behave badly. To some degree, therefore, quality, or the lack of it, is in the eye of the beholder.
So I was mildly shocked to read a recent piece in the FT on managing mediocrity that perpetuates so many hoary old myths about talent management that it’s hard to know where to begin.
Let’s try. In fact the article is a classic case of looking at the world through management eyes, in which the worker figures only as an object. It’s as if management played no part in employees’ performance. Yet the best predictor of employee engagement and satisfaction at work, and thus of discretionary effort, is the quality of the immediate manager. And here the evidence collected by Julian Birkinshaw and colleagues at London Business School is incontrovertible. In the view from below, more people who actually do the work have bad managers than have good ones.
Survey after survey confirms the management gap. Thus, some years ago, the CIPD noted that if Britain at work was a marriage, it was ‘a marriage under stress, characterised by poor communications and low levels of trust’.
Only a minority of workers felt senior managers and directors treated them with respect, and two-thirds didn’t trust them. Around one-quarter of employees rarely or never looked forward to going to work, and almost half either wanted to leave or were in the process of doing so.
Or take the grim reading provided by Gallup’s Employee Engagement Index. In 2005 it found that just 16 per cent of UK employees were positively engaged, meaning they were loyal and committed to their organisation. The remaining 84 per cent were unengaged or actively disengaged, ie physically present but psychologically absent. And if anything the situation was getting worse – since 2001 the proportion of engaged employees had fallen, while those actively disengaged have increased.
Gallup then put the cost to the UK economy of active disengagement at £40bn, as employees expressed their disenchantment by going off sick, not trying, or going somewhere else. The culprit: poor management. ‘Workers say they don’t know what is expected of them, their managers don’t care about them as people, their jobs aren’t a good fit for their talents, and their views count for little’, Gallup reported. Disaffection actually grew with tenure, so ‘human assets that should increase in value with training and development instead depreciate as managers and companies fail to maximise this investment.’
Treating talent as a fixed quantity, categorising workers as A, B or C players and hiring (and firing) accordingly is yet one more crude example of the fallacy of composition that so besets management: believing that the performance of the whole is the sum of those of the individual parts. A better analogy is football. Most work, like football, is a team game. In teams the context is all: so a well-integrated team of B players can outplay a disjointed group of stars, a C player can be elevated into an essential element in an A team, and a star can be brought to earth by a transfer into an unsympathetic context. Just ask Chelsea’s Fernando Torres. Academic research among stock analysts confirms this: stars often underperform in a new setting because the role of the non-stars in establishing the enabling environment has been underestimated. A team is a complex and sensitive organisation.
This explains why the idea of bottom-slicing or forced ranking, as casually proposed in the FT article, is in most cases so misguided. Forced ranking has been a fact of life at GE, and also at Microsoft. But there is no evidence of a causal link with their success, and stacks to say that more often than not it does more harm than good. It takes no account of the team and the impossibility of optimising its performance by optimising the individual parts. Forced ranking introduces fear and competition, and while in economic theory these optimise individual performance, they sub-optimise the team. Fear makes people stupid, and if it motivates at all, it is the behaviours that undermine teamwork, such as hiding, cheating and hoarding precious information and other resources.
The definition of management is getting things done through people. Its authentic magic is getting extraordinary results from ‘ordinary’ resources by using good work design to multiply individual and organisational talent, making the whole more than the sum of the parts. That's management's job. If an organisation is mediocre, there's only one place where the responsibility lies.