Years ago, I read something about performance appraisals that stuck with me. Someone said that assessing employees was relatively easy because there are only three kinds: “super stars, doing OKs, and ain’t worth killings.”
I’ve spent much of the last week with a client who is in the process of passing his business to the next generation. It’s a small business with six locations and 50-plus employees. As part of making sure the business is sound, we went through a talent assessment to look at each employee and where they stand in terms of performance and potential.
We used a simple process. We put each employee’s name and position on a large Post-it note. We then put those notes up on the wall to form a large organizational chart. Managers took colored dots and rated each employee -- green for those great employees with potential, yellow for those “OKs” and red for any problem employees. We also added a blue dot to those employees who are three-to-five years out from retirement. Our discussions raised several questions I think might be helpful for any small business owner to consider.
Look at your mix of reds, yellows, and greens. What do your red dots say about how you’re managing performance? Why are they still on your payroll? Can you afford to keep those people who are not performing? What do you need to do to move them out of the organization?
Every organization needs their share of yellow dots, but what does it mean if you have an abundance of “just doing OKs?” In an age of small businesses needing to do more with less, is OK enough? How many OKs can you afford to carry? Are they OK because they are in a learning mode and just need more time in the job or are they OK because they’ve reached the limit of their potential? What do you need to do to help some of your higher-performing yellows move to green? What do you need to do to manage your lower-performing yellows?
And what about your greens? These are the people you don’t want to lose. What do you need to do to let them know they are important to you? What do you need to do to develop the potential you see? Such as making sure your stars are paid fairly, developed well, understand their potential for advancement and know that they are “loved” is critical to the future of the organization.
The blue dots in this exercise are important. They help you visually identify where the holes in your organization are likely to be in the near future. How much time do you have to develop backup? How much bench strength, or lack thereof, do you have? What do you have to do to make sure someone is ready to step up when your blues are ready to leave?
I’ve used this process often in the past, and one more time, I’m struck by the power and impact of getting a visual overview of the organization and its talent. Take the time to see for yourself, and I think you’ll be glad you did.
An experienced business executive and organizational consultant, Jan Flynn teaches at the J. Whitney Bunting College of Business at Georgia College & State University.