80-20 Problem: Just A Few Top Performers Create Most Value
Over-relying on top performers' to get things done right is 'Managing on the Edge of Failure' yet organizations perpetuate the status quo
- Absent top performers destroy productivity
- Many top performers are getting burnt-out
- Root causes of excellence are unknown
- High performers want to fire non-performers
- Training produces only marginal effects
- We ignore top performers impact on Culture
Your ultimate productivity RISK is failing to hire, develop and retain more high performers
Top performers add 4-8 times more value than average but managers have grown so complacent they perpetuate the false belief that "Average" is good.
This is wrong because Industry-leading competitors are setting higher standards for the organization
Value Curve - Research Evidence
Schmidt & Hunter's research shows top performers (in the 84th percentile) far outproduce average workers by
- 19% in unskilled roles, 32% in skilled roles, and 48% in professional and managerial roles
O'Boyle & Aguinis (2012) found that 20% of employees generate 80% of the value an organization creates.
It should be abundantly clear that your future depends on hiring-developing-retaining more high performers
Value Gap in Dollars
This value gap is largest exactly where it costs the most. Here is what the talent gap means in dollars:
- In $40,000 roles, poor performers contribute $32,000 less per year than a top performer.
- A top performer in that same role adds $16,000 more per year than average — roughly 40% above the role's base value.
- At a $65,000 average salary, 1,000 top performers would add $26M in value per year over an average-performing workforce.
Evidence of Talent Engineering's Lasting Impact
We collected and analyzed millions of data points on what distinguished thousands of top performers in diverse jobs at well-known companies. This included:
Alcatel, Hitachi, J&J, Nokia and Texas Instruments.
Our technology worked seamlessly with existing HR tools so they issued us contractor badges to deploy it globally.
The contracts with these clients lasted for many years because we not only delivered results, but also taught them how to self-reliantly use the technology to get science-based explanations for performance variance.
3-STEP TALENT ENGINEERING PROCESS has 6 corresponding APPLICATIONS tools to help you to Hire-Develop-Engage-Retain Top Performers
- Standards — Define high performance in a specific role-team, and environment.
- Measures — Objectively measure people against those standards
- Solutions — target development to close measured gaps and track performance
The Users' License includes 6 Application tools
- Candidate Guide attracts exceptional people
- Hiring Guide selects in top performers
- Development Guide focuses on talent gaps
- Coaching Guide shows the path to excellence
- Self Management Guide - job-specific model
- Culture Guide edits habits and expectations
$14 MILLION additional annual revenue
attributed to Talent Engineering hiring standards and science-based selection methods
- 714 Sales Reps used it to self-develop
- $Millions gained from Profile standards
- 3.2× difference in productivity
- Lower Turnover = Lower Costs
- Shorter time to productivity
A single Success Profile had annually reoccurring impact
Talent gaps between High Vs Average is actionable
Better hires reduced turnover and lowered hiring costs
LASTING VALUE GENERATED FROM A SINGLE SUCCESS PROFILE
1) SUSTAINED ANNUAL INCREASE IN REVENUE
2) JOB-COMPATBLE HIRES ARE HAPPIER, MORE SUCCESSFUL, STAY LONGER
5) MONEY SAVED BY REDUCING TURNOVER PUT TO PRODUCTIVE USE
3) EVERY SALES REP GETS A 'WORKING MODEL' OF HOW TO SUCCEED
6) REPS COLLABORATE BY SHARING SUCCESS STORIES AND METHODS
4) MANAGERS SPEND LESS TIME SUPERVISING POOR PERFORMERS
7) CUSTOMERS GET STABIITY IN THE SALES REPS WHO SUPPORT THEM
More Examples How Talent Engineering Adds Measurable Value
Informed, unbiased hiring and development decisions
Informed, unbiased hiring and development decisions
Informed, unbiased hiring and development decisions
Leaders, HR pros and candidates trust our measures will accurately assess job-person compatibility and predict performance without bias.
87% Predictive Accuracy of Year-end Performance
Informed, unbiased hiring and development decisions
Informed, unbiased hiring and development decisions
Talent Engineering analytics was used to accurately predict job performance ratings for 42 HR professionals with 87% accuracy
Workforce Alignment from Talent Diagnostics
Informed, unbiased hiring and development decisions
Workforce Alignment from Talent Diagnostics
73% of scheduled layoffs avoided.
A workforce alignment analysis uncovered hidden, transferable talent and reassigned 41 of 56 mechanical engineers who were scheduled for layoff
CASE HISTORIES OF HOW TALENT ENGINEERING ADDS VALUE
$Millions in Improved Quality by Cutting Technician Turnover 16%
QUALITY PROBLEM DUE TO TURNOVER
At a wafer fab operation, technician turnover was costing $millions in production errors-delays, quality
TALENT ENGINEERING SOLUTION
We identified a sample of technicians with high work quality, low turnover, and conscientious work habits. We studied them on 5 levels of talent measurement and built a PROFILE of what distinguished them.
Talent Engineering software produced guides to hire, develop and manage on these high standards.
RESULT: turnover dropped, productivity increased and the client ordered Profiles on all their jobs
Assessment-based Development
We led an international team of psychologists and talent consultants to develop and execute a leadership assessment-development-coaching process
510 middle managers and executives were assessed and coached on 21 leadership standards.
One year later, leaders coached on 21 standards received significantly higher feedback ratings from their managers, peers, and subordinates while
Uncoached managers ratings did not improve
Culture-Climate Analysis led to Successful Interventions
A 90-item Work-People-Environment survey was conducted on over 600 production plant employees and their managers. Analysis of organization culture-climate issues causing dissatisfaction were reported to site-wide teams who successfully solved most issues