Authors and Consultants | GP Strategies Corporation

performance

Who Are Your Top Performers?

9460463189_667905c98cWhen we work with organizations to help improve performance, one question we ask is, “Who are your top performers?” What we are seeking are examples of people who are currently doing excellent work and consistently delivering the results the organization desires.

Our question turns out to be much harder than it might seem.

Too often, we have to challenge leaders’ preconceptions to find the real top performers. To explain, let’s look at some of the usual answers we receive and examine the preconceptions behind them—and why they fall short.

Option A: Managers Who Used to Be Performers

Since managers who used to be performers were selected for advancement, they surely were the best, right? Perhaps. But the key word in that sentence is were. They were the best (perhaps).

But since these performers were promoted, two factors have changed. First, the job changed. To stay competitive, organizations have to evolve rapidly and continually. Roles must change to stay abreast of that evolution. So the role the manager filled as a past performer may not be the same role filled by current performers, making comparison problematic.

Second, the new managers have changed. They are now in a new role. Hopefully, they were selected for that role because of their potential for excellence in the new role, not just because of their performance in the old one. (That’s a subject for another day.) Since they’ve been in their new role, they’ve been acquiring new skills and mental models to replace the old ones they used as performers, which means they can no longer accurately represent the particulars of current top performers.

Option B: Those with the Longest Tenure

Those who have been there the longest must be the best, right? Not very often. Staying in a company a long time does not make an employee a top performer. Length of employment alone is not an accurate indicator of performance. Too often, people stay in jobs because they are comfortable, not because they are excelling.

Option C: Related Role

Quite often, organizations will identify a great performer, but the individual isn’t really in the role we are asking about. For example, if the role in question is that of financial advisor, then a credit counselor—who works with financial advisors and may be able to talk intelligently about that role—may be mentioned as a top performer. But it is not the same role, and all the hidden tricks, unconscious expertise, and mental models required are not the same either.

Option D: Top Performers Currently Excelling in the Role Being Studied

This is the right choice!

When we ask for top performers, what we really want are people who

  • Are currently in the role being studied
  • Are consistently excelling in that role
  • Represent the range of geographic and organizational groups that exist in the organization

A good trick to identify the top performers is to think of the performers you would call on when the job gets really difficult. Here are some examples from different industries:

Refinery Operations

  • Which operator would you prefer to be “running the board” in the event of a process flow problem?
  • Which operator would call in to work when a problem occurs?

Customer Service Call Center

  • Which person would you prefer to take calls from your highest value prospects?
  • Which person would you want handling irate callers?
  • Who is the best at converting inquiries to sales or upselling?

Sales

  • Which sales executive would you prefer to handle the client with the most potential to grow?
  • Who would you choose to solve a difficult client retention issue?

 

The bottom line is that when trying to understand what differentiates top performers from average performers, identifying and studying the top performers is essential. Only then can you accurately map how they do what they do and then build programs to help others excel in the same way.

By the way, yes—the top performers are often the busiest because you call on them all the time. But they are often the most willing to help. They want to succeed and they usually want others to succeed as well.

Who would you identify as your top performers?

 

 

photo credit: Trophy presented to Don Bradman, 1948 via photopin (license)

The Importance of Moving the Middle: Check Out the Numbers

11322953266_db29ce0659Many companies struggle with the question of whether to invest in the development of their people. When they do decide to invest, they often ask, “Whom do I invest in?” Many choose to invest in the development of their top performers. After all, these companies reason, if they are already the best, doesn’t that mean they have the most potential to do even more? While investing in the top performers as a reward or to keep them motivated can be worthwhile, does that really provide the largest return to the business?

To examine this question, let’s take an example sales role and look at a typical distribution curve among a 100-person sales force.

 

Category (%) Sales people in category Assumed average % of quota met Average sales per person ($) Total revenue contribution ($)
Top 20% 20 125% $2,500,000 $50,000,000
Middle 60% 60 85% $1,700,000 $102,000,000
Bottom 20% 20 50% $1,000,000 $20,000,000
Total sales revenue $172,000,000

 

For illustrative purposes, let’s assume that a company’s development initiative improves performance by 10 percent across the board. Though it is quite realistic to move the average performers by 10 percent, moving the already high-performing group by an incremental 10 percent can prove more challenging. Meanwhile the bottom 20 percent of the population may have fundamental fit issues that make the 10 percent goal an improbable stretch. Nonetheless, in our simple example we will assume all three categories of performers improve by an equal 10 percent to bring the new total sales revenue to $189 million (see table below). How this increase plays out among the three performance categories is interesting.

 

Category (%) Number of sales people in category % of quota met after improvement New average sales per person ($) Group change in revenue contribution ($) % added to the revenue line by group
Top 20% 20 138% $2,750,000 $5,000,000 2.91%
Middle 60% 60 94% $1,870,000 $10,200,00 5.93%
Bottom 20% 20 55% $1,100,000 $2,000,000 1.16%
Total change in sales revenue $17,200,000 10.00%
Total sales revenue $189,200,000

 

As the second table illustrates, the overall sales revenue grows from $172 million to $189 million with the same resource base. The somewhat surprising element in this simple example is that the revenue increase provided by the average performers is double that of the top performers. Given that boosting the output of the top performers can be more difficult, the implications are significant. Organizations must focus their improvement efforts on the middle of the distribution curve where the potential for improvement is often greater than 10 percent. As our example shows, the impact is substantial.

Closing the gap between the top and average performers delivers much better overall organization improvement than can be achieved by trying to squeeze more out of the top performers or spending enormous energy to improve the bottom.

 

Question to consider:

  • What insights does the distribution of your top twenty, average sixty, and bottom twenty provide you?

 
photo credit: Numbers And Finance via photopin (license)

Right Work; Work Right

4320245924_b8f945a7f8Which is more important: To perform the right work or to perform the work before us in the right way?

In one sense the question is almost silly. Of course it’s important to do both: to know the right work and to do it in the right way. But too often organizations focus entirely on people performing their work the right way without paying any attention to whether or not they are doing the right work. This can be seen in the myriad productivity improvement efforts encouraging people to do more, to work smarter, to be more efficient, and so on.

While those efforts are important, they must come second. First, organizations must ensure their people fully understand their roles and how each role contributes to organizational success.

According to a poll conducted by William Schiemann, only 14 percent of employees “have a good understanding of their company’s strategy and direction.” But if people don’t understand where the company is going, how can they be expected to contribute to the process of getting there?

Our consulting work has demonstrated to us over and over again that a significant gap exists between how top performers understand their role and how average performers understand their role. It turns out that average performers are often working just as hard as top performers. They are trying hard, they care, and they put in the long hours. But they just don’t seem to get the same results. Our experience is that these workers are effectively working at a wrong role. They are not doing the right work. So it doesn’t matter if they are doing the work right or not.

 

Questions to consider:

  • How do you ensure that each member of the team understands his or her role?
  • What methods do you use to communicate the strategy and direction of the company?

 

 

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Leading or Lagging?

5532002687_6009a50a5fInterestingly, very few top performers whom we’ve worked with over the years spend much time looking at quotas or traditional sales funnel pictures as reported by sales-force automation packages. For example, most top performers view a quota as a lagging indicator: it can tell you whether you made your quota last period, not whether you will make your quota next period. Think of lagging indicators as great rearview mirrors: they aren’t very good at telling you what’s up ahead.

Top performers usually know well in advance if they will make their quota or not. Many develop and use personal tracking measures to better predict their results. These private tracking systems are more like a built-in navigation system than a rearview mirror. They let the user know what’s up ahead, where to turn, and how close they are to their destination. Think about the top performers you know or have worked with. Most of them probably have some kind of personal spreadsheet they use to track their deal flow. Those personal spreadsheets are based on their own set of leading indicators. Their spreadsheets document their tricks of the trade that unfortunately don’t fit neatly into sales systems or reports. But they are extremely useful and valid predictors of the timing and value of the business they will close.

One interesting aspect of leading vs. lagging indicators is when top performers choose to move something from their private list to the formal sales reporting mechanism. That choice is based on factors that are usually well understood by the top performers but not at all understood by average performers. But these factors are not mysteries; they can be uncovered and understood. When understood, they can be leveraged to close the gap between top and average performers.

 

Questions to consider

  • Are you using mostly leading or mostly lagging indicators?
  • What is your level of understanding about the leading indicators used by your top salespeople?

photo credit: Figure 4 via photopin (license)

Customer Service or Customer Delight?

13780167005_80f1894253The following story is based on an actual experience. Some of the details have been simplified, but the customer service rep and her reaction to the customer request are real.

 

The call was fairly routine. The customer wanted to know how to return something. She had bought a fly-fishing kit as a gift for a nephew who was planning a fishing trip to Florida, but the kit she purchased just wouldn’t work.


“Why not, may I ask?” the customer service rep inquired.


The customer laughed and explained that her nephew was planning a tarpon fishing trip. Tarpon are quite large and challenging to catch, so tarpon fishing requires heavy-duty fishing gear. But instead, the customer had bought a lightweight trout fishing kit designed for use on small rivers. “If I fished myself,” the customer said, “I would have understood the difference and bought the right thing in the first place.” As it was, she would have to deal with the hassle of returning the first fishing kit and purchasing a new one. “I just hope I can get it all sorted out before my nephew leaves on his fishing trip.”


The rep apologized to the customer: “I’m sorry for our mistake.”


“No,” the customer exclaimed, “I made the mistake. I bought the wrong thing. You shipped exactly what I ordered.”


“No,” the rep explained, “it was our mistake. We didn’t ask enough questions to help you pick the right gift for your nephew. It turns out that we carry a fly-fishing kit specifically designed for saltwater game fish like tarpon. I’ve taken the liberty of placing an order for that one. We still have your nephew’s address on file. So I’m having the new kit overnighted to him, so he’ll have it in time for his trip. There’s no charge for the overnight shipping. And when your nephew gets the new kit, simply use the return shipping label in the package to return the other fishing kit to us. And tell him to please send along a picture of a big tarpon!” 

Questions to consider

  • If you were the customer, how would you react to the rep’s response?
  • If you were the rep’s supervisor, how would you coach the rep if you observed this call?

photo credit: customer service assistant on phone via photopin (license)

Dangerous Myth

490829226_eada2a10dbA powerful myth is at work in the sales field today: the Myth of Sameness. This myth says that all the people in the sales force are about the same. They have the same skills, knowledge, motivations, and desires as each other, and they function as a monolith.

According to the Myth of Sameness, any difference in sales results is assumed to be because someone works harder, is more motivated, or follows orders more closely or sometimes because one performer has a “better” personality than his or her colleagues. The Myth of Sameness is a powerful force, but it’s dangerous and it’s wrong!

An analytical look at most sales organizations shows a lack of sameness. In fact, the performance of the people in most sales organizations is distributed across a spectrum that typically takes the form of a normal distribution curve.

Some performers are doing great. We’ll call them the top performers. Some are barely meeting the minimum expectations to stay in the organization. And the great majority are clustered in the average or good performance range.

It is important to understand the size of the gap between the top and average performers. This is where the Myth of Sameness starts to breaks down.

Though sales leaders have a general sense that their top and average people are different, few have stopped to put numbers on those differences. Fewer still have analyzed the numbers to determine the real cost to the organization. Beginning with McKinsey’s talent studies in 1997 and in 2001 and continuing through our own work there are discernable differences that point to a huge performance gap between the best (A) and average (B) performers:

A 2001 study by McKinsey, which formed the basis for the book, entitled “The War for Talent” shows:

  • A players on average grew revenue by nearly 50 percent.
  • B players showed little or no ability to grow revenue.

This type of data is consistent in our work with sales teams across various industries. To put it bluntly, A players drive the organization, C players hurt the organization, and B players, despite their best efforts, are just along for the ride. So the old adage that a sales organization should routinely get rid of the bottom performers is true. But a new and much more impactful motto is that organizations must move B performers up to A-level performance if they want to see any meaningful positive impact.

Even when recognized, this type of disparity often results in Band-Aid fixes, or worse yet, the gap between top and average performers is just accepted as the status quo. Instead, the situation requires focused action to close that performance gap.

 

Questions to consider

  • What is the performance distribution of your sales force?
  • How much time and energy are you devoting to improving the performance of your average or good salespeople?


photo credit: More of the Same via photopin (license)

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