Why would you ever put the sales high performer into a management role?
By: Ted Bauer
Tags: Future Of Work, Talent Management, Performance, Work, Management And Leadership

One of the biggest problems at work is the high performer confusion. Let me explain that out.

In a hierarchy, the only way to make more money is to rise up 1–2 (or more) levels. There are a lot of flaws with hierarchy, and this is most assuredly one of them. It typically creates cultures where the people most concerned with money end up becoming managers. But here’s the confusion: they are not managers because they wanted to manage other human beings, they are managers because it was the only way to get a bigger salary. Good managers are often super rare in companies. Why? Start right here with this high performer confusion.

And now, the second issue: most leadership is about soft skills, but too often we reward a high performer — “eat what you kill” sales guy, yea? — and make him a manager. This is logical in one way: good performance led to a promotion. That’s how it all should work. But the problem is, you just minted a “brilliant jerk” manager. The high performer might be smart and driven, but that doesn’t necessarily correlate to being a good manager. In fact, it often correlates to being an awful one.

Now we’ve got some more research here.

The high performer research

This is from Stanford University, and it also references a famous study by Google about better management. The Stanford study took law firms and adjusted compensation, bonuses, and billable hours. The basic results:

On a typical team, the senior attorney gave up about 7 hours of billable work but the two associates increased their billable work by a total of 18 hours. As a result, the firm as a whole was reaping more billable hours. And even though the junior associates were earning more than they had before, the firm was earning more for each of their additional hours as well.

The old model was “eat what you kill” based on the high performer driving everything and rising the chain. The new model was about collaboration and delegation of work to junior associates. And as you can see, everyone made more money, so did the firm, and senior attorneys could get home and see their families a bit sooner. Win-win-win.

Now, this isn’t exactly what I was discussing above — because this study didn’t look at promotions as much. But hey, we’ve got stuff on that too.

Potential vs. achievement

Because of the need for soft skills in leadership, and the fact that many a high performer focuses simply on achievement, a new belief has emerged in thinking. The belief is more academic than corporate — corporate still by and large promotes from achievement — but the new idea is that potential matters more than achievement.

The elephant in this room is that we’re all supposed to compete on data now. It’s hard to have concrete data on what constitutes “potential.” Plus, this whole thing would be owned by HR, and HR metrics are fairly unreliable right now. So there are definitely challenges. And if you kept promoting from a place of potential, the high performer would leave (passed over for too many promotions). Now you just lost a star, and that could hurt the bottom line.

We need to think about and research management a little bit differently, because the era we live/work in is different. That’s what my newsletter tries to do. Sign up here.

Here’s the problem we need to solve: how do we move people who would be good for management into those roles, as opposed to a high performer who simply needs the next salary band?

We need to understand management better

Such as:

We tend to think about management and leadership from outdated perspectives — 1911, anyone? — and that leads to poor decision-making on “Tommy should be a manager and Justin should not.” In reality, Justin might make a much better manager and Tommy a much better individual contributor, but Tommy must become a manager because he’s a high performer and wants the cheddar. The problem is, Tommy becomes a manager and burns out 10 direct reports, increasing churn massively. That hurts the bottom line. Justin would have developed those 10 reports, increasing productivity. A simple decision — Tommy vs. Justin as a manager — could represent millions of lost money on recruiting, training, etc. No one thinks this way, though.

That’s the second part of the equation. We need to think about management differently (above), but we also need new compensation structures. You need to be able to make as much as an IC as you can being a manager. When incentive programs are flawed, nothing else lines up correctly. People make priority-laden decisions (or want to believe they do) off of incentives, even if they claim something else.

So: think about “what management is” differently, and shift the incentive structures. If a high performer asshole can keep making more money working solo within a silo, GREAT. Keep him there. Moving him to management is bad for everyone involved.

Old school vs. new school

This is a very old school vs. new school discussion.

Old school would say “If he’s a high performer, he deserves to be promoted and minted.”

New school would say “We have all this data now and can figure out if he’s the right managerial candidate here, so let’s run this personality algorithm and see…”

How you think on this topic comes down to which school you buy into, honestly.

I do believe a high performer needs more chances to shine, of course.

But I’ve also seen many an individual high performer become a boss and literally burn their silo to the ground because of a host of factors, usually around empathy and communication.

Anything else you’d add on the high performer becomes a manager confusion issue?