What to Do About Underperformers
What to do about underperformers
One of the biggest problems I see leaders dealing with everyday is how to deal with underperformers. To be a great company, you've got to have great people. As a leader, the most important job you have is to surround yourself with the right people. One of the biggest mistakes I see companies make is tolerating underperformers way too long, which is not only bad for the company, but also bad for the underperformers.
When you tolerate underperformers too long, it hurts you, it hurts your company's ability to live its purpose, it hurts your company's ability to have the impact you want it to have, it hurts you as a leader personally. It impacts your time, it impacts your money, it impacts your freedom, it impacts your level of fulfillment and why you started this business or why you're leading this whole team in the first place.
Most of all, it impacts your A players. Your A players get frustrated, and that frustration leads to one of two things. First, it leads to them getting frustrated and leaving. Second, and maybe just as harmful or more harmful, is it leads to them getting frustrated and staying. And they go from being an A player to being a B player, to maybe even becoming what I call a toxic C player. It's a big problem in organizations today.
So let's talk about the solution. The solution really starts with understanding the importance of A players in your organization. Kip Tindell, the founder of The Container Store, has a great philosophy about A players I love, called 1 equals 3. 1 equals 3 says: 1 A player, 1 super star, equals the productivity of 3 moderate/mediocre performing players. 1 superstar equals the productivity of 3 mediocre performers. Think about that. I would venture to guess for you, if you've got B or C players in a leadership team level, it may be 1 equals 4 or 1 equals 5, maybe 1 equals 10. That means you could pay an A player double what you pay a B player or a C player, and still get more return on investment for that A player.
So, what does it mean to be an A player? How do you assess your organization? How do you assess the talent in your organization to figure out who your A, B, and C players are? Number one: you need to understand how important it is to have those superstars that are A players. because they are at least 3 times more productive than your B and C players. Number two: you need to put a process in place.
I'm going to recommend what I call a quarterly talent assessment, where you're looking at talent not just by looking at productivity, and that's what people normally do - they look at a salesperson and they base whether they're an A, B, C player on the revenue they brought in - and that seems pretty logical. But what you're missing when you look at that one-dimensional view of productivity, is how that person is impacting your culture. If you have a set of core values, are they living those core values every single day? Even if you don't have a formal set of core values, you know whether someone fits your culture and I don't care how productive they are. If they don't fit your culture, if they're not living and breathing those core values every day, they're like a toxin to your organization. So what I suggest is that quarterly, as a leader and as a leadership team, you assess the next level down in your organization, identifying who your A players, B players, C players, and what I call your toxic C players are.
Your folks that are very high in both core values and productivity are your A players. Those are your superstars. For the folks that are low in core values - they are not living the core values 30% of the time or more - and core values are non-negotiable behaviors. They're not a fit for your culture. Those are your toxic C players. I don't care how productive they are. For folks that are living your core values, but they're not productive enough, they're slowing you down because they're very low in productivity, those are your C players. The rest that are living your core values productive enough, but they're not superstar A players, those are your B players. You get A, B, C, and toxic C.
Now let's talk about what you do about your underperformers. For your C players that are underperforming from a productivity standpoint, you've got three choices:
Coach them to improve productivity.
Say they are never going to be productive in this role - is there another role in the organization that may allow us to take greater advantage of the strengths that they have? Maybe they're not a great sales person, but they'd be great as a service person. So for a C player, someone who's underperforming from a productivity standpoint, you can coach them to improve their productivity, or you can change their role.
Cut the cord and say they're hurting the company. They're never going to be an A player here. Let's set them free to become an A player somewhere else.
For your toxic C players that aren't living the core values, that's a little tougher, because while you can sometimes coach productivity, nine out of ten times you're not going to be able to coach someone to start living your core values or to be a better fit for your culture if they're not already a fit. If they don't live the core values, if it's not who they are, they might if you threaten their job, they might start to live those core values to save their job, but soon enough they're going to go back to who they really are. And by the way, who they really are is not a bad person. It just means they're a bad fit for your organization.
So if you've got an underperformer that's underperforming because they're not living your core values, because they're not a good fit for your culture, you have two choices:
Coach them.
Cut the cord.
If you decide to coach, I'll tell you what I tell the leadership teams I coach privately: you've got 90 days to fix that problem. You do not want to take someone who's toxic to the organization and allow them to hurt your organization for 6 months, 9 months, 12 months, or 18 months. We've all seen people that we know don't belong there hurting the organization and we keep them for months. We keep them for years. So what I tell leadership teams is you've got 90 days to coach that person. If we come back here again in 90 days and they're still a toxic C, and you still believe they need more coaching, you might be the C player. It's tough for people to hear, but you've got to take care of those underperformers. You're hurting them because they could become an A player somewhere else. I truly believe everybody has the ability to be an A player somewhere. Even if it's not your organization. So you're hurting them, you're hurting the A players within your organization, you're hurting yourself, you're hurting your ability for your company to live its purpose and have an impact.
The problem you'll deal with here is the excuses that you get, the excuses you give yourself for why you're not cutting your underperformer, setting your underperformers free. You'll hear, "Well, they've been around so long, I feel loyalty to them. I don't want to fire them because she's been around 15 years and I feel some loyalty." Well are you more loyal to that one person than you are to the other 50 in your organization? You'll hear, "If we cut the cord on this person we'll be short-staffed."
Remember the 1 equals 3 philosophy. By cutting that person and replacing them with an A player, you're going to triple your productivity. You might find you don't even have to replace that person. By cutting them, everybody around them is going to become more productive. Some folks even say A players cost too much - we can't have that many A players in our organization - and my answer to you is if you've got 90% A players in your organization, trust me, you will be able to afford all the promotions, all of the increase in salaries that you need, because you'll be growing so fast and so profitably. The biggest reason people don't take care of their underperformers, their C players, is they're afraid of having that difficult conversation. But I will tell you I have never heard someone say, "Man, I think I fired that person too quickly." But how many times have you heard yourself say, and how many times have you heard others say, when they do take that action and cut the cord on someone that's hurting the organization, "Man, I should have done that months ago."
So my question to you is: are there C players you've been holding on to for too long that you should take action on right now? When are you going to put a process in place to identify those A, B, and C players?
Take care of your A's, take care of your B's, and take care of your C's. Go take action.