When And How Do I Know I Can Fire With Minimal Business Impact?
Jack Welch, was the CEO of GE that made Topgrading famous. He hired Brad Smart and they worked together to hire the top guys at G.E. He is famous for focusing on A's and he used the 4 Quadrant Chart that we are discussing today. This chart plots performance against living your culture.
Lack of clarity and success criteria will cause poor performance due to poor management, not due to the person. Let me share a personal story about a controller who worked for me at a previous company. We were not doing well on our Accounts Receivables (A/R). So we met to discuss this. I was stunned when I realized that we had different success criteria. Here was our success criteria for a bold comparison:
Green Yellow Red
Patrick 30 Days 45 Days 45 Days
Controller 45 Days 90 Days 95 Days
I was appalled! Her Green was my Yellow. That meant that when she thought she was succeeding, I felt that she was about to fail. We discussed this and agreed to manage A/R according to my success criteria and desired outcome. We then build a dashboard using this success criteria, and A/R performance improved. So this poor performance was not because of the person, it was because of poor management. When there is no clear success criteria and no clear "End in Mind," it is due to poor management.
Ok, so now, you can use the chart and discuss which quadrant your people fall into. What is an "A" player? It is about the combination of 2 things: Results and Core Values. Using the 4 quadrant chart:
- A players are performing very well and live the core values
- C players are not performing and not living the core values - why are we waiting to get rid of them? We don't even like working with them because they do not live our culture!
- B+ players are living the core value and not performing well. Decide if they are in the wrong seat and get them into a job they have strengths and skills for, or train up their skill if they need training.
- B- players are what Jack Welch calls the cancer of the company. They are high performers that are a pain to live with. They do not live the core values, but we tolerate them due to their high performance. If they continue to not live your core values, while it is hard to do, you should fire them as well.
The B- players who are unwilling to change with the company or align with the direction will drain time from the CEO and team. They may even be well liked by clients, maybe they have been around for years, and are often emotionally hard to fire. Keeping them means more drama and more emotional energy being drained.
So - "C" players you can fire with minimal business impact. "B-" players you might have business impact for the short term, but you are better off for the long term if you wish to build a great company.