Knowing your Top, Middle, and Bottom

     If random managers were asked to name their employees that make up their top 20 percent with regards to performance – how many could do so? Or, how many managers would know which employees make up their bottom 10 percent? Unfortunately not many. And if you don’t know who your top and bottom performers are, you more than likely don’t know who makes up your middle. I have been aware of this concept which many of you know is what made GE so successful under Jack Welch’s helm. Jack believed that his company differentiated itself from others by differentiating people within his organization. He would assess and separate employees into three categories in terms of performance: top 20 percent, middle 70, and bottom 10. So why is this so important?     
     Having this information on paper (or computer screen) will immediately help guide your decisions regarding your department, business, or organization because it makes it real. And when something is real it allows you to act on it. All of us differentiate our teams to some degree in our heads – but what do we do with that information? Does having this information in our heads help us make management decisions that improve our operations? Speaking for myself I know it didn’t. I always felt that I knew who my stars were and who my weak links were – but I didn’t do anything extra with this knowledge. I continued to manage my team and deal with the issues that arose from the weak links knowing that one day they probably won’t be with me any longer. For the employees who were my top performers I did my best to thank them for their hard work and recognized them as great assets to our team. To be truly candid, until just a few days ago, I thought I was doing pretty good managing this team dynamic. I thanked those who did great consistently, I held accountable those that broke the rules or failed to perform. But I learned that there is so much more opportunity to improve my operations by taking the time to clearly define my stars, middle work horses, and those at the bottom slowing us down. Here is the process I went through.
     I came to a point within my operations where I began to feel like I had too many people working in areas that didn’t need it and not enough people in areas that did. For me to correct this would require adjusting schedules and responsibilities which naturally impacts people. It would impact some for the better and some for the worse. So the question I was faced with is – who do I reward with better shifts and responsibilities and who do I negatively impact with less desired shifts and responsibilities? Simple – I need to rate each employee from top to bottom.
     Rating a large number of employees can become a daunting task so I began with baby steps. I quickly went down my list and rated each employee from 1 to 5. In my case 5 being the best and 1 being the worst. I now had a list of employees with a rating next to their name. I then segregated each employee into three distinct functions. You may have more or less, the point being you identify how many there are and fit each employee into their respective category or function. Having each employee in smaller groups with a rating made it much easier for me to rate them from top to bottom within each category. Now I was able to look at my three top employees from each category and identify who my overall top performer is. Then out of my final two top performers from their respective function I was able to select my second overall best performer and so on. Before you knew it, I had the department rated from 1 to 29. At this point, I simply determined how many employees constituted 20 percent and filled them in. In my case 20 percent of 29 employees are 5.8 so I rounded up to 6 employees. The top 6 rated employees were my top 20 percent. I then followed this process to identify the 70 percent that made up my core work force and eventually my bottom 10 percent.
     It was amazing, with regards to my top performers half of them I anticipated, the other half I was pleasantly surprised. Within my core 70 percent, I was amazed to learn how some of the employees I did not expect were towards the top of the 70 while others found themselves towards the bottom. And as you can imagine, seeing on paper the employees that made up my bottom 10 percent was a true eye opener. Having this data it immediately began to change how I managed this department. I was energized to know who my top stars are. These are the people I need to involve in helping improve our operations. These are the folks I need to empower to identify new and better ways of doing things. I don’t just need to thank them for their great work – I need to take advantage of their great work and give them the opportunity to do even greater things. These are the individuals I need to invest in and develop them for promotional opportunities.
     Looking at my core 70 percent, it became so clear who my dependable group was. This is the team that is not very flashy or steps out of their comfort zone, but they are the group that I would be lost without. This is the group that is handling the bulk of our workload. It also became apparent who was at the top of this group and had potential to move up. And on the other hand I learned that who I thought was at the top of the list was actually towards the bottom. This made me realize I had individuals in leadership roles that should not be in them, and other employees who should. We quickly made changes to reflect what we learned from this exercise. Making these changes immediately rewarded those employees who have been working hard and performing which improved their morale and simultaneously improved the operations of this department.
     With regards to the employees who made up the bottom 10 percent. It was interesting to me how even though I anticipated that some of them would be in this group – it was not clear to me that I should be acting on this reality. As clear as it now became, I knew that if I wanted to be a strong leader, I now had the information to act and I better act. I could no longer be in a position with assumptions and no action. By not putting a plan in place to eliminate this weight on the department, I would be directly responsible for slowing this department down.
     Having utilized Jack Welch’s 20/70/10 concept from his book Winning allowed me to have a much clearer perspective of this department. It gave me the information needed to make better managerial decisions which in turn will improve our operations. This process made it extremely clear who my stars are and who I should be investing time in so that they can grow and develop and as a result, our overall department can grow and develop. I cannot urge you enough to conduct this exercise with your team no matter what the size. Jack Welch closes the chapter in his book Winning with the following:
     "If you want the best people on your team, you need to face up to differentiation. I don’t know of any   people management system that does it better – with more transparency, fairness, and speed. It isn’t perfect. But differentiation, like candor, clarifies business and makes it run better in every way."