Covering up for bad performance management may well hurt your best employees
Sometimes management mistakes hit a little too close to home, and you realize that the things that organizations do to protect themselves from bad management can end up costing them their best people. This week, someone I know very well ran into that sort of situation, and as a result, her employer is probably going to lose their best employee.
If you’ve spent more than an hour with me, you’ll have heard my favorite management aphorism — “management spends 95% of its effort on the most troublesome 5% of its people.” In the context of management, it means that instead of simply requiring managers to actually manage, organizations put in place complex systems that limit management. In short, it’s easier to prevent mistakes by limiting flexibility and imposing rules. This translates to taking away the ability of good managers to manage, and protecting bad managers from being exposed for their failures.
The corollary to the aphorism is, of course, “the things that organizations do to protect themselves from bad management will harm their best employees the most.” A common place for organizations to limit management is in the performance review process. There is a feeling, often reasonably justified, that without limits, many managers will “over rate” their employees, or at the least, not draw the kinds of distinctions that need to be made. This frequently does lead to overpayment and unwarranted increases. Well trained managers, with the proper tools, should have no difficulty assessing the performance of their staff, and taking appropriate actions, including performance evaluations, compensation recommendations and the establishment of plans for development. It is true, on the other hand, that some managers cannot do so — whether it is from a lack of training, a lack of skill, or simply a desire to be the hero to their employees. Instead of dealing with this management problem, organizations often impose hard limits, or unreasonable categorization of employees.
The idea that all employees can be “ranked” in some even scale from top to bottom or that “only a fixed percentage of employees in any department can be considered excellent,” or that “only one employee in any department can get a raise,” is simply wrong. Moral or philosophical considerations aside, its just not good management. Compounding this fallacy with the idea that every department, every location or every function will have the same proportion of performance should make you pause at the sheer inanity of the concept. The reality is that some departments will have a lot of good people, others will have few. These limitations certainly will stop a poor manager from giving everyone a big raise…. but what does it do to the good manager who has developed a high quality staff, perhaps even through making tough decisions on who can stay in their department, and ensuring that each one of their staff members if fully up to their standards? How, with a straight face, can an organization say that it is a good idea to limit the ability of a good manager to reward his or her top-notch employees? How, with a straight face, can an organization institute a system that rewards lazy management but punishes high performers while rewarding those who exert less effort?
For the college football fans among you — consider the Bowl Championship Series. The top team from each of six conferences gets a chance to play in a top tier bowl game on or about New Year’s Day. It is unquestionable that the conferences are not equal, and it is also unquestionable that the second-best, and sometimes third- and fourth-best, teams in one conference are left out in the cold while a relatively poor team from another conference gets the prime spot. Every year, there is an uproar at the results of this method for picking teams — yet this very same type of process goes on every day in the workforce, affecting millions of workers in thousands of companies.
Lets be honest, there are very few jobs where performance can be rated so objectively that there is a clear cut “number one,” and most of these are production positions, or perhaps sales jobs. In the rest of the universe, the best performers will always strive to be the best, and they will always believe they are the best. When they’re told they are doing an outstanding job, they believe, correctly, that they’ve earned the right to treatment appropriate for their efforts. They have earned the right to believe that they will be treated fairly. When management decides that only one person in each department will receive a raise, even the best of managers is forced with an impossible dilemma. For an organization to believe that this kind of decision can be made free of personal relationships/friendships, or free of considerations about future prospects, or even free of subtle discrimination (whether on the basis of gender, race or any other distinction), rises to a level of absurdity. However… in some sad way…. its considered easier than looking across the entire organization to ensure that all the top performers are rewarded.
Lets ask a simple question to those who would rather take the “easier” path. If you have two or three outstanding employees in a department, and only one can get rewarded, and there is no completely objective way to prove who is best — there is going to be a justifiably unhappy person. And if there is even a hint, no matter how slight, that the decision may have been made based on anything other than purely objective standards, the person left out may consider taking his or her talents elsewhere. If, on the other side of the office, a department with no outstanding performers gives an average person a raise…. our theoretical disappointed person will certainly take his or her talents elsewhere.
The thing is… that theoretical person is often real. Its a shame to lose your best people because you don’t want to manage… isn’t it.
