London to LaGuardia was the third leg of one of several circumnavigations of the globe I made that year. The numbing jetlag on the previous excursion taught me to make this trip on the westbound route. Still the brutal 24-hour flight from Sydney to London was just two days ago. I was drained, but at least the driver wasn’t the talkative type. I settled into the back of the town car for the hour-long drive to Fairfield.
By the time we pulled up to General Electric’s headquarters, the late summer sun had reached the golden hour. The campus’s 66 rolling acres seemed especially pastoral. Low concrete office buildings were strategically scattered so that looking out any of the many windows showed little but meadows, woodlands, ponds, and the occasional deer.
I was taken to the “guest house”, GE’s own boutique hotel on the grounds. Black tile and sleek artwork graced the understated entrance. The concierge practically whispered as she greeted me and whisked me to my room for the evening.
I spent the next day discussing leadership in the Fortune 500 with Bill Conaty, my peer atop GE’s human resources. I was also afforded a rare half hour with Jack Welch, by then a famous CEO. Both men were contemplative as Jack leaked the secret of his impending retirement. Jack was eager to boast of his legacy of leadership development. He lauded the deep bench of talent he and Bill had created. He was confident in this team as he looked forward to his departure, which was announced a couple of months later.
Bill was quite a bit more reflective when he and I were alone. One of his most famous inventions had long outlived its welcome. Despite Bill’s pleas, Jack wielded it like a cudgel and the damage it had done to GE would last for years. And that’s what this is all about.
This is Leading Smart, the show about Managing in the Brainpower Age. It’s a field guide to the joys and challenges of leading and working in the modern workplace. I’m Chris Williams, your guide to the stories and ideas that I hope will inspire you to be a better leader in the world of knowledge work.
As we wrap up a tough year, for many it means another round of performance reviews. This seems like a great time to reprise one of my favorite episodes. This is Episode 228 — A Redux of Bottom Feeder.
Bill Conaty spent over thirty years at GE, the last half of that as the company’s top human resources officer. In the 1990s the business press was flooded with articles about how Jack Welch had engineered “the GE Way”. GE had been revitalized into a worldwide juggernaut on the strength of a strong senior executive team. Bill had been the key architect of much of that fertile leadership development. But one his most famous legacies was just the opposite, a ruthless way to clean house.
Century-old GE had the bloat that many large corporations experience. Middle management ranks were fat and cumbersome. Extra hands brought in for a project had lingered well beyond their need. The organization festered with people who had long ago lost the urgency to maintain a vital culture.
Bill crafted a policy to help clean out the excess. As part of performance reviews, managers stack ranked their organization, a fairly common practice. But Bill’s proposed twist was to simply fire the bottom ten percent. Just “boom”, you’re gone.
The “shock and awe” of this appealed to Jack. He loved the idea of trimming the waste and cutting the costs. But more importantly, he loved the toughness of it. He was famous for “straight talk” as he called it, and this mathematical approach appealed to his engineering background. The resulting sense of urgency it created in those remaining was just what he wanted for GE.
Bill reconciled it to himself by realizing that GE needed to trim personnel. He could imagine worse ways to do it. He also was reassured knowing that, even if a vital role was cut, the replacement would likely be a better performer. The team could trade a “D” for the chance at a “B” or even an “A” performer. There’s a valid argument there, one we’ll discuss in our next episode. As a way to trim fat, this sort of lifeboat drill has many merits.
At first, the policy had the desired effect. The ranks were trimmed, the excess was clearly gone, and a culture of performance was reinstated. Yet, as years of the policy wore on, it began to take a toll. You can only diet for so long before the weight loss begins to eat into the muscle.
After two or three years, fear replaced urgency. It created a dog-eat-dog culture. People attacked teammates to avoid the bottom ten percent. Vital roles got cut and replacements took too long to get up to speed. Teams that were lean and highly functional cut fat that didn’t exist. Some had even hired people knowing they would need someone to cut at performance review time.
When I met with Bill, he was reflective. At first this policy was just what the company needed. He thought it a temporary measure, but Jack loved it so much, he wouldn’t let it go. The better part of a decade in, by the time I met with him, Bill regretted it entirely. He quietly hinted at looking forward to Jack’s departure as a way to back down from it.
The lifeboat drill infested many other companies in the 90s, thanks in a large measure to the publicity it received at GE. It had found its way to Microsoft. That was at least in part, why I jumped at the chance to visit with Bill. To understand where this came from, and to learn all I could about the effects it had.
Microsoft wasn’t ruthless enough to fire the bottom ten percent, but we stack ranked teams. And we micromanaged performance review scores. To prevent grade inflation, where – like Lake Woebegone – everyone was above average, Microsoft enforced a “natural distribution” of performance review ratings. Only so many top scores were permitted, and a solid ten percent were required to get poor review scores.
I’ve discussed performance reviews at length in earlier episodes. And we’ll discuss the exact perils of treating people like numbers in an upcoming episode. But for now, let’s consider the onerous rule that ten percent be declared poor performers.
Like most statistics, this natural distribution is fine when considered in the large. It can be an effective marker to highlight areas where more rigor in the review process might be required. But as you work down to smaller and smaller teams, very quickly you’re looking at individuals.
The problem with enforcing a distribution quota at the team level is not at the top. People who don’t make the top bracket are only inspired to work harder. The problem is at the bottom, where you need to stand on the neck of someone else to avoid drowning in the cesspool.
That poor review I gave in episode three, Duck and Cover — the one that resulted in a stapler being thrown at my head? It was partly due to these distribution requirements.
No, Microsoft didn’t fire the bottom ten percent, but in a culture driven by excellence and focused on performance, it certainly made life miserable. Who would want to be considered worse than ninety percent of their peers? I’m quite sure we lost plenty of up and coming talent or reliable steady performers simply to make quota.
For the manager making the rankings, a forced distribution blurs the line between performance and value. Every organization, especially one focused on brainpower work, has a broad range of roles and responsibilities. Some people are the creatives, the imagineers, the ones who see the future and drive the bus. Others are the doers, the critical infrastructure that allows the creatives to function. They are the “just get it done” kind of people, the engines of the bus.
Neither group gets very far without the other. But when asked to stack rank the organization, who ends up at the bottom? The administrative assistants, the scrum masters, the house cleaners. The ones who do the unglamorous essential work that makes life possible for the stars.
There exist a precious few executives who realize that their assistant is the only person who keeps them sane. But outside of that, few managers place the essential workers high in their stack ranking. Most rank the creatives at the top. They are the heart and soul of a brainpower organization. It’s silly to expect anything different. Yet this leaves little room in the lifeboat for the people who man the oars.
Les Barkimer was the night operator when I was in charge of computer systems for National Family Opinion. Les worked third shift, and was gone by 6am, long before anyone arrived at work for the day. His main duty was backups. He managed the refrigerator-size tape drives and shuffled the dozens of nightly tapes with care and expertise.
Les was in his sixties, a slim man who sported a carefully packed lunch box as he came and went. He was always pleasant, but he often hid his teeth, a mouthful of darkened stubs from years of neglect. When we finally added a dental plan, he invested the next six months in the dentist chair. He ended up with a wonderful smile to complement his demeanor and he flashed it with pride.
Les was entirely self-sufficient. He would leave me notes on my desk when he needed more tapes, or when a machine needed repair. Every so often, I’d come in at dawn to check in with him, just to see how things were going. He always seemed uncomfortable with the attention. When I asked if he needed anything, he said “if I wanted something, I’d leave you a note.”
Once, I asked if Les wanted to move to days and take on more responsibility. He looked at me with his brow furled and head slightly tilted. “Why would I want to do that,” he wondered. “I like what I do, the work is good, and the pay is fine.” We just left it at that.
In the years I knew and later managed Les, I can think of perhaps two or three times when he made a mistake. And his work was vital. Several times a year we’d suffer a hard drive failure, and Les’s careful backups would save the day.
But if you asked me to stack rank my organization, where would Les end up? If I was forced to cut the team in a lifeboat drill, would Les be in the boat? Probably. But I couldn’t guarantee it. And that’s completely unfair to Les.
Separating a role from its value is a challenge. This is mostly because the role itself has many ways to be recognized regardless of the occupant. Compensation is the most obvious. The star roles are more competitive in the job market, they get higher base pay, and they are more likely to get bonuses. They even have more prestigious titles. And as we’ve seen, they get stack ranked higher. But this recognition is about the job role, not about the occupant.
The person who occupies a job should be judged, especially at performance review time, for their execution of the role. The outstanding night backup operator should be recognized for their work. Just as the failing creative should be held accountable for their lack of success.
Further, though it’s difficult for many in the brainpower world to accept, not everyone wants to grow beyond their current role. Many people like what they do, they have plenty of interests or challenges in their life outside of work. This unglamorous work life is just fine with them. They simply want to do their job very well. Should their role alone relegate them to the bottom of the stack ranking? Should that stack rank force a terrible performance review? Of course not.
Then what exactly is poor performance? There are lots of paths to failure. But it can be hard to separate the people not set up for success from those who willfully execute poorly. Knowing the difference between “cannot” and “will not” is important when judging failure.
There are many ways someone “cannot” succeed. They may not have the tools or training they need. The role itself could be poorly formed, a no-win situation caught between competing priorities. Or external forces might make success impossible.
In a senior role, I expect people to change or push past things that are limiting their success. It’s part of what makes a senior level position. But in lower level roles, it’s not fair to judge a person’s performance on things outside of their control. For them, it’s often impossible to alter conditions that hold them back. Here, a performance review should be tempered to meet the environment.
For others, though, failure is often of the “will not” variety. The best way to identify those failures in the world of brainpower work is by looking at attitude. Those who willfully execute poorly aren’t hard to spot. They are lazy, simply phoning it in. They don’t follow explicit rules or policy, endangering others or their projects. Not because of some oversight or mistake, but because they couldn’t be bothered. Worst of all they don’t really care about the results of their work. Their entire outlook can best be summed up with: “meh, whatever”.
Despite being hard to quantify, demeanor is a valuable guide. An attitude check can usually reveal if someone wants to be successful. They want to get it done, they simply can’t. That tells you it’s not them, it’s you, their manager. You haven’t set them up to be successful.
The metric for performance reviews should be each role’s goals and objectives. People who perform poorly, for their position, are the ones who deserve the low marks. They are the ones who deserve the corrective measures. They are the ones you should be asking yourself if they are worth it. They are the bottom-feeders. Regardless of where they are in the stack ranking.
Finally, what if you have a clearly poor performer. What do you do? Next time we’ll talk about how you decide if living with this employee is worth it. Whether they are a pain-in-the-keister superstar or a woe-is-me bottom-feeder, how do you make the decision to let them go? And then what? How do you fire them? That’s the next two episodes.
In the meantime, please remember that everyone deserves to be rewarded for their attitude, their passion, their expertise in whatever corner of the organization they occupy. If the team isn’t successful, it’s almost certainly not the fault of the guy making the nightly backups.
Leading Smart is from me, Chris Williams. You can find out more about the show and discover other resources for leaders at my web site CLWill.com.
If you like the show, please share it with your friends especially on social media. Referrals are the greatest source of new listeners. I’d also love your feedback. I’m “theCLWill” on Twitter, LinkedIn, and Facebook, or send email to email@example.com.
That’s it for this episode. Next week as we begin the new year, we’ll have brand new episode. I hope you’ll listen. Until then, please remember that each of the several dozen decisions you make today are part of Leading Smart.