MUSCLE BUILD YOUR ORGANIZATION
continued — back to start

With a fix on each manager's current performance and development needs, you can then take a look at each executive's potential. A single question asking how far each person can advance (measured by the number of job layers) will usually start a lively and productive discussion, especially when a manager is ranked as high-potential yet has remained in the same job for four or five years.

You should repeat your questioning with all important department heads. Ideally, you should gather in-depth information on at least two or three levels of people under you. Your personal involvement is the best way to galvanize top managers into action, because they will recognize your commitment to big changes in the way the organization operates. Going through this process, unit by unit and manager by manager, is obviously hard work, but there is no easy way to establish and enforce tougher performance standards and focus everyone's attention on management development.

The work is not only time-consuming but also emotionally charged. It leads to heated discussions, especially early on, when standards are likely to differ widely. Using elaborate performance-appraisal forms and systems, as most companies do, is easier, but these systems are usually a triumph of form over substance, an annual exercise to be gotten over quickly. A simple, informal, face-to-face approach is what's needed to boost performance. You must be willing to engage in frank, tough-minded discussions of each manager's weaknesses, and you must convince each person to use equal candor with subordinates. 

You are likely to find that many executives are initially either unwilling or unable to give you useful staff evaluations. For example, a division manager might say that everyone in the division is doing a pretty good job. If this happens, you will have to bear down and force the manger to draw distinctions to, for example, identify who is the single best performer. It is also helpful to ask the executive to categorize the managers into four groups, form poor to superior, and then ask for a specific plan for the people in each group. Always focus first on the bottom group. The manager should specify who should be replaced, who should be reassigned, and when these decisions will be implemented.

Rooting out the poorest performers will foster a climate of continual improvement. If everyone in the bottom quartile is replaced, the third quartile becomes the new bottom group and the focus of subsequent improvement efforts.

The human tendency to avoid confrontation allows companies to fall into the trap of complacency and sub-par performance. Upgrading the organization, by contrast, requires managers to make tough decisions: to fire some people, demote or bypass others, and tell poor performers where they stand. No one enjoys delivering bad news, but good managers will understand how critical it is to the company's long-term success, particularly if the CEO personally sets the example.

Some managers might object that this relentless scrutiny and the inevitable firings will demoralize employees. My experience suggests precisely the opposite. Top performers relish the challenge of meeting even higher goals. What does demoralize them is a climate that tolerates mediocrity; under such circumstances, they may slow down their work to the tempo of the organization, or they may leave the company.

After you have completed your preliminary situation analysis, you are ready to formulate the specific actions you will take over the next 9 to 12 months to muscle-build your organization. What are your goals for each key manager and each department? What are the implications of those plans for recruiting and job assignments? This action plan sets the stage for a more demanding and results-oriented environment, one in which measurable progress will occur.

Focusing on a limited number of high-impact results, conducting comparative evaluations, and separating current performance from potential will produce far better effects than focusing on personal traits, making exhaustive MBO lists, or using rigorous forms.

The analysis, of course, does not stop here but should become an on-going process, a day-to-day questioning. What's working well? Where can we improve? Over time, you may wish to supplement your face-to-face interviews with surveys to gather this kind of information.

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