2. I. Introduction: Ready. Shoot. Aim.
Some companies aren’t just cutting, they’re hacking. They’re cutting deep
and fast. But are they cutting smart?
A recent article in HR Executive magazine assessed the
dangers that exist when companies cut with little insight
during the current downturn. “All too often downsizings follow
a similar pattern: Executives decide that the workforce must
be cut by 5 percent to save money, the cuts are apportioned
across the workforce, and then the HR executive is asked to
oversee the reductions and ensure the process doesn’t violate
any laws or regulations.” That’s the unfortunate reality for
many businesses. But even as these economic dark clouds
PERFORMANCE >>
gather, the article did offer a glimmer of sunshine. “Companies
that have a rigorous performance-appraisal system in place
will be the most prepared to ride out the economic storm.”1
OK, but how does “a rigorous performance appraisal
process” work? Ideally, managers need to be able to put their
POTENTIAL >>
employees on a grid of performance vs. potential (like the one
at the left) so they can see clearly who they need to keep and
who can be cut. Seems simple enough — keep your stars, cut
your low-performance, low-potential employees.
This is the basis of performance management. As McKinsey
and Company explained, companies that conduct disciplined,
meritocratic assessments of performance and potential are
well placed to make good personnel decisions. Businesses
should be able to assess which types of talent drive business
value today and which will drive it three years from now, as
well as which talent segments are currently available and
which will be in the future.2
However, some talent areas are easier to measure than
others. Assessing top sales people is relatively easy – they
can be measured against their sales figures. But what about
employees who deliver value every day in ways that are vital
to the success of your company in far less transparent ways?
Every organization has key players who deliver value but do it
in ways that may not be easily measured or captured in some
performance reviews. Can your talent management initiatives
identify these Invisible Employees? Or does your current
process let these employees fly under the radar?
McIlvaine, Andrew R. Riding Out the Storm. Human Resource Executive Online. January 1, 2009. http://www.hreonline.com/HRE/story.jsp?storyId=162283435
1
2
Guthridge, Matthewl McPherson, John R.; and Wolf, William J. Upgrading Talent. The McKinsey Quarterly. December 2008. http://www.mckinseyquarterly.com/Organization/
Talent/Upgrading_talent_2260
3. II. Who Are Your Invisible Employees?
You recognize that your organization’s top performing employees — your rock stars — are the
ones who drive bottom-line results. And you probably feel you know who they are — your top
sales person, your No. 1 technical guy and so on. But not every organization realizes that the
supporting cast — the unsung heroes — also contributes in many less apparent but no less
important ways to your success. These are your Invisible Employees.
The Invisible Employee can take many forms:
• Yesterday’s Superstars: These are the old reliables who may have jumped off the fast track to
achieve a better work-life balance, but that doesn’t mean they’re has-beens. But they are seasoned and
sharp and they step up in a crisis. They can also be valuable mentors.3
• The Connectors: This may be the account executive who manages a key vendor relationship or the
project manager who keeps a critical technical team on task and on budget. In social-networking-speak,
these are your connectors and brokers.4
• The Advisors: Whether they are truth tellers or go-to-managers who understand the ways of your
organization, they make your organization run smoothly.5
In a down economy, these Invisible Employees are the ones who can bring much-needed
stability to your workforce — they keep people on task and productive as your business works
through these tough times.
Without a performance management system that allows you to recognize their contributions,
the best you can hope is that you don’t cut these people by accident. Is there a chance they will
resent the fact their value isn’t recognized and leave for an opportunity elsewhere? Maybe not
today, but that outcome is more likely when things improve. The more likely hazard you face
is mixing up these invisible employees with the low-performing, low-potential employees who
are keeping a low profile or the low-performing, low-potential employees who seem to have a
knack for surviving.
Does your organization have a way to recognize your Invisible Employees?
DeLong, Thomas J. and Vijayaraghaven, Vineeta. Let’s Hear It for B Players. Portfolio.com. http://www.portfolio.com/resources/insight-center/2007/09/11/Lets-Hear-It-for-B-Players
3
4
Cross, Robert L.; Parise, Salvatore; Weiss, Leigh J. The role of networks in organizational change. McKinsey Quarterly. April 2007. http://www.mckinseyquarterly.com/the_role_of_
networks_in_organizational_change_1989
5
DeLong, Thomas J. and Vijayaraghaven, Vineeta. Let’s Hear It for B Players. Portfolio.com. http://www.portfolio.com/resources/insight-center/2007/09/11/Lets-Hear-It-for-B-Players
4. III. In Tough Times, Talent Matters
The quality of your people matters all the time, but perhaps never more than now. In good times, you
hope that your rock stars and Invisible Employees will lead you to the Promised Land — IPOs, huge year-
end bonuses and jumbo shrimp at the Holiday Party. These days, many have more modest goals in mind.
Unfortunately, the fear that comes along with the current economic uncertainty will lead many companies
to make decisions they didn’t necessarily think through carefully. However, making bad decisions quickly is
not a virtue. Here are three quick talent management recommendations for tough times:
• Cut smart if you must cut: No company enjoys firing people,
but it’s worse to fire the wrong people — it’s unfair to the employee and
your business. Some cuts can be avoided by finding efficiencies. Cisco
took that approach in shedding 8,500 jobs in 2001. When the company
redesigned roles and responsibilities to improve cooperation among
functions and reduce duplication of effort, talented employees were
more satisfied in a more collaborative workplace.6 Can you hang on to
more people by working smarter? Possibly. But if you do need to make
cuts, how will you decide who to keep?
PERFORMANCE >>
• Think long-term: Although this may seem obvious — like telling the
Lakers to win the game by scoring more points — but in a downturn,
the temptation to focus on this quarter instead of two or three years
down the road is very real. According to research from McKinsey and
Company, decisions made at companies without any strategic planning
process are twice as likely to have generated extremely poor results as
extremely good ones — more than a fifth of them generated revenue
POTENTIAL >> 75 percent or more below expectations.7 Bad decisions have bottom-
line results. Don’t get caught up in the moment — make performance
decisions based on data.
• Set the tone for the future: Employees have long memories.
If you recognize the value of your invisible employees today, they may
or may not remember it when they decide whether or not to remain
with the company when the economy improves. But ignore their
contributions and treat them shabby today? They’ll definitely remember
that. See that star? That’s them leaving your organization. Even if you
are not worried about tomorrow’s retention issues, you can’t overlook
today’s productivity and engagement issues. As one HR director
recently told HR Executive magazine: “When times are easy, a company
can espouse all kinds of wonderful values, but it’s the hard times that
let employees really see whether those values are genuine or simply
platitudes. Employees understand that, during tough times, there are
going to be difficult decisions about who stays and who goes. They get
it. But how you handle the process is incredibly important.”8
Your organization needs a performance management process to make any necessary cuts, nurture
superior performance and handle today’s talent challenges. Not everyone in your organization is
a rock star, but with the right tools, your managers can identify the Invisible Employees and vital
supporting cast members as you encourage higher performance from everyone.
6
Bryan, Lowell and Farrell, Diana. Leading Through Uncertainty. The McKinsey Quarterly. December 2008 http://www.mckinseyquarterly.com/Leading_through_uncertainty_2263
How companies make good decisions: McKinsey Global Survey Results. The McKinsey Quarterly. January 2009. http://www.mckinseyquarterly.com/How_companies_make_good_
7
decisions_McKinsey_Global_Survey_Results_2282
8
McIlvaine, Andrew R. Riding Out the Storm. Human Resource Executive Online. January 1, 2009. http://www.hreonline.com/HRE/story.jsp?storyId=162283435
5. IV. Prepare Your Organization
for the Talent Challenges It Faces
Many organizations already understand that development and coaching are necessary. However,
not everyone realizes that preparing your organization for the talent challenges it faces requires
the tools and support systems to make data-driven performance management decisions.
It’s difficult for a paper-based performance management process to provide the visibility into
a business that allows managers to see quickly and easily how employees stack up in the
spectrum of Performance vs. Potential and how employee performance improves over time.
How can a data-driven, graphics-based process help your managers make these decisions?
• It makes it easy. In a survey from Bersin and Associates, 45 percent
of respondents said their managers are incapable of differentiating
high and low performers, and 38 percent of managers believe they do
not have the training or support to adequately conduct performance
management tasks. Top executives and HR can get the ball rolling on
these initiatives, but your frontline managers are the ones who must be
able to execute them.9 Making it easy for your frontline managers with
easy-to-use, intuitive systems and the training to use them increases
their odds — and yours — of creating success.
It creates a support system. As mentioned earlier in this report,
PERFORMANCE >>
•
it’s easier to assess employee performance in some areas than others.
Managers need on-the-job support systems — built-in tips to reinforce
best practices, coaching guides, and tools to monitor and reward
appropriate performance that help them identify and nurture talent,
regardless of job title.10 With this support, your managers can easily
identify who the truly talented people are, whether they are your top
POTENTIAL >> performers, your Invisible Employees or the high-potential employees
who can grow into high-performance employees.
• Providing clarity. Even though identifying the potential of individual
employees and improving their performance is a valuable feature of
a performance management system, the high-level, helicopter view
of your organization allows you to see performance in a new way,
identifying both risks and opportunities. A graphics-based performance
management solution can offer this high-level view into the organization
with visuals that are built after reviews are completed.
9
Levensaler, Leighanne. The Time Is Now. Talent Management Magazine. January 2009. http://www.talentmgt.com/departments/dashboard/2009/January/828/index.
php?pt=a&aid=828&start=0&page=1
10
Stolovitch, Harold D. Apply Low-Cost Measures. Talent Management Magazine. January 2009. http://www.talentmgt.com/columnists/human-peformance/2009/
January/836/index.php
6. V. Conclusion
For most organizations, it’s hard enough to hire or develop high-performing employees.
Retaining a low performing/low potential employee in place of a high performing/high potential
one is a bad business practice and completely avoidable if your managers have the right tools
to guide these critical decisions.
Cutting during a downturn is painful, but when it is done with insight, these cuts can ensure
a company’s profitability and future competitiveness. As McKinsey explained it, “companies
should use this period as an opportunity to upgrade talent and better engage existing staff.
This means reinvesting a percentage of the capital liberated from cost cutting into, for example,
selective recruiting and development programs and in efforts to safeguard the culture and to
redesign jobs so that they are more engaging to the remaining employees.”11
The economic realities in 2009 will mean that companies will need to take action. Make sure
that the moves you make identify both your top performers and your invisible employees and
not only address today’s business needs but prepare you for better times in the future.
About Sonar6
Sonar6 is the only graphics-based performance management system that is easy to learn, easy to use and simplifies staff
performance management, enabling organizations to enhance employee development, make better people decisions and drive
organizational improvement. Through its graphics-based interface, users can create great staff performance reviews online, gain
access to helicopter views of the organization and make more-informed staff decisions. Awarded product-of-the-year 2007 from
Human Resource Executive Magazine, Sonar6 is offered as a Software-as-a-Service (SAAS) delivery model and is used by small and
large companies throughout Australasia, Asia, Europe and the United States. For more information, visit www.sonar6.com.
Guthridge, Matthewl McPherson, John R.; and Wolf, William J. Upgrading Talent. The McKinsey Quarterly. December 2008. http://www.mckinseyquarterly.com/Organization/Talent/
11
Upgrading_talent_2260