Most companies use formal employee evaluation and performance appraisal processes. Great – but if you really want to identify your top performers, your poorest performers, and the skills and behaviors that matter most to your business, try this:
Pretend you have to fire one of your employees. Today.
If you had to fire someone, how would you decide which employee should go? You could take the easy way out, like using seniority and firing the most recently hired employee. Or you could decide by pay grade and fire the lowest paid or lowest job-grade employee. Or you could let someone go based on role criticality, firing an employee in a function that you can most afford to do without in the short term.
Unfortunately the easy way out is usually the worst way out: Your best performing employee might be one of your least senior employees. Can you really afford to let a superstar go just because it’s easy?
Another relatively easy way to identify the employee you should fire is to compare performance review data.
I almost did that once. I worked at a manufacturing facility and when layoffs loomed, the HR manager suggested using employee evaluations as a theoretically objective and legally defensible decision-making tool.
Every manager, including me, pushed back hard. We all felt that employee evaluations were a decent way to provide employee feedback but we had no interest in using those evaluations to decide something important – like who should be laid off.
Of course that pointed out the fact our evaluations were less than effective, since a few of the employees we could least afford to lose had recently received the worst evaluations.
We had all willingly used an evaluation system that failed to measure real, meaningful performance. (Yes, shame on us.)
So pretend you have to fire one of your employees today. How would you decide whom to fire? Don’t take the easy way out. Don’t base your decision on “interpersonal skills” or “teamwork skills” or “attention to detail” or other boilerplate employee evaluation categories that sound great but fail to measure key skills and significant achievements.
Instead, choose the person who contributes least to the success of your business. Focus on key performance indicators and actions and real accomplishments. Focus on contributions to your bottom line. A difficult-to-work-with salesperson may fall short in a number of your standard evaluation categories, but if she is responsible for a major chunk of your revenue – you can’t afford to lose her.
Then take the process a step further. Rank all your employees based on what they contribute to operations and profits. You may be surprised when a few of your highest-ranked employees have received mediocre performance evaluations – and some of your lowest ranked employees have received the best evaluations. In fact, you may realize the way you currently evaluate your employees is in large part a waste of effort.
If that’s the case, change your employee evaluation process so it measures what really matters to your business: Quantifiable results.
Oh, and if the employee you decided to fire as part of this exercise really is dead weight – it’s probably time to let him go.