Should businesses invest in their best or poorest performers?

Some surveys suggest managers spend up to a day each week managing their poorest performers. This is despite receiving only marginal gains in productivity from this group. In uncertain financial times, can you really afford to prioritise your strugglers or is it better to invest in your stars?

Keeping low performers comes at a cost

According to McKinsey research, successful businesses focus on attracting and keeping high or A level and B level performers. More importantly, their policies actively push out low or C-level performers; particularly managers who can impact team performance.

Recent Eagle Hill Consulting research confirms this by finding that strugglers drag down overall morale – new ideas and originality begin to falter, and “mediocrity” becomes the norm. High performers become antagonised as their workload increases and achievements are ignored. If they feel compelled to leave, your company loses their knowledge, productivity wanes and you face recruitment, training and set up costs for new staff.

Holding on to your high performers through the right incentives

In a 2009 study examining retention rates, researchers from the Universities of Kentucky and Minnesota found that good reward programmes including training, pay and other benefits often encouraged both high and low performers to stay.

However creating a high performance culture (with programmes that set clear employer expectations and then linked rewards) kept high performers around and encouraged low performers to leave. This was because low performers found it easier to work in places with less ‘monitoring’ while high performers felt motivated and thrived.

Supporting your high performers means giving them targeted positive feedback and creating an environment that helps them fly. Do they have the resources and tools they need? Are there any barriers holding them back? Too much red tape, slow flow of information, incorrect inputs or lacklustre processing times? Find ways to recognise their contributions and to model high-performing behaviour within your team.

Can you turn the ship around?

Perhaps your business does not have the cash to lose anybody right now. Maybe your sense of fair play won’t let you give up on low performers. First, as experts suggest, work out whether the person is struggling with a lack of knowledge, skills or motivation. Then put in place a performance management plan (limited to one-three months) with well-defined expectations along with the consequences of any underperformance.

Provide targeted coaching but use your time wisely: try short “stand up” meetings twice a day where you work on set outcomes and provide specific feedback. Focus on improving the strengths that can be used to tackle vulnerable areas and not just on weaknesses. If there is no improvement then unfortunately you will need to let these employees go. If you must keep people on due to staff shortages, consider reassigning them to an area that limits the impact on other high performing staff or is not customer facing.

Play the law of averages

Don’t overlook the sizeable gains you can make by focusing on your ‘middle of the curve’ performers and taking them to the next level. Share any insights you’ve gleaned from your high performers to accelerate learning with the whole team. Ask your stars to be ‘buddies’ to team members or set up a shadowing system. Play the law of averages: if you are able to substantially improve the performance of up to 70 per cent of your team, then this is far more powerful than driving smaller increases from your stars or strugglers.

Hanan Nagi is an international trainer, personal development expert and inspirational speaker