Understand what drives top performers

 It is time for us to stand and cheer for the doer, the achiever, the one who recognizes the challenge and does something about it. 

–Vince Lombardi

Finding out what motivates your top employees on an individual level is critical. The easiest way to figure out what motivates these employees is to simply ask them directly. Set up frank conversations to find out what they would like to be doing, and what drives them to do their best.

Ask them questions such as:

• What kinds of work are you most passionate about?
• What types of opportunities for learning do you find most exciting?
• What types of rewards most motivate you? Are you most energized by money, autonomy, affiliation, title, time off, or intellectual challenge?

Sometimes these questions are difficult to ask directly. Instead, you may have to deduce the answers by asking less direct questions, such as: What do you like, or not like, about your job? Alternatively, you may simply pay attention to the employees' behavior, taking note of the tasks they seem to enjoy, and what seems to motivate them the most.

Also, be sure to find out if anything about their job situation is frustrating them, such as too much travel, difficult colleagues, or not enough challenge from day to day. Try to address their needs and desires—and eliminate obstacles as best you can. Help them to develop by shaping their careers and responsibilities in the direction they'd like to go. To move them in the right direction, you'll have to provide them with the right growth opportunities.

How do you motivate employees?

Satisfying the needs of stars and nurturing their professional growth is critical to an organization's success. Your best employees, or A players, boost company performance, both directly—by working diligently at their jobs—and indirectly, by their ability to inspire and motivate others. Therefore it's critical to invest the time and energy to keep them satisfied and engaged.

In the past, managers often focused their motivation efforts on "extrinsic" factors—those aspects of a job that are related to job environment, not the job content itself. These motivators included:

• Company policies and benefits
• Working conditions
• Salary and other forms of compensation
• Status

Today, successful managers understand that externally focused incentives often provide only short-term motivation. They understand that appealing to people's inner drives, needs, and desires can achieve better results. This type of motivation relies on "intrinsic" factors that are related to job content and draws from within employees. These motivators include:

• On-the-job-achievement
• Positive feedback about the quality of work
• Opportunities for growth and learning
• A sense of responsibility for the work being done

Use placement to determine next steps

Key Idea
Once you've placed your employees on the Performance and Potential Grid, your next step is to determine the best course of action for each one.

Returning to the example, you have already determined that Isabel is a solid contributor who is both valuable and productive. The suggested course of action for managers who want to develop employees in this group includes: keeping the employee engaged and motivated through recognition, as well as focusing on improving the employee's performance.
With solid contributors like Isabel, you might also test to see if greater accomplishment is possible, and if so, provide appropriate developmental opportunities. Also keep watch for increases in a solid contributor's performance and potential.

More broadly speaking, you'll want to consider the following guidelines after you've determined each employee's level.

• Be sure to invest in your top employees (your 2s, 3s, and 6s). What resources do you have to invest in these people to keep them appropriately challenged? What motivation can you provide to keep them satisfied? Be aware that there may not be much room for advancement for top employees within your group. Think about alternative ways to engage them and help them grow professionally.
• Strive to affirm and grow your solid contributors (your 1s, 4s, and 5s). What can be done to ensure that they are satisfied and stay productive? Consider whether there are opportunities for growth within your team and organization.
• Finally, act decisively with underperforming team members who lack initiative (your 7s, 8s, and 9s). Identify the people on your team who lack initiative and continually underperform. What can be done to ensure that their performance is dealt with or that they are in the job that best suits them?

You've seen how to use the Grid to plot both an employee's performance and potential. But what steps do you take once you determine placement?

Ways of differentiating

 Treat people as if they were what they ought to be and you help them to become what they are capable of being. 

–Goethe

Many organizations differentiate employees according to performance. Using this model, managers divide their direct reports into three groups:

• Top performers: Employees who define the standard for exceptional performance by consistently delivering results and motivating others to do so as well.
• Solid performers: Employees who consistently meet expectations but may not be on a fast track within the organization.
• Underperformers: Employees who just "get by," delivering barely acceptable results.

Other firms choose to designate their employees' performance in more relative terms. In a given group or unit, top performers would be the best 10%–20%; solid performers, the middle 60%–80%; and underperformers, the bottom 10%–20%. However, using a forced ranking system is often controversial. Since only a few people can be ranked as top performers, forced ranking may foster an intimidating, competitive environment. In addition, many managers find it difficult to assign a certain percentage of their employees—especially if they are performing adequately—to the lowest rank.

An alternative way to assess performance is to factor in an employee's potential in the assessment. By considering potential, you not only take into account an employee's historical contribution, but also the individual's future value.

Differentiating may be difficult

Simply stated, differentiation is the process by which managers assess team members to provide them with appropriate growth and job enrichment opportunities. It's important to keep in mind that differentiation is not the process by which you pass judgment on which of your employees are the "best" (or "worst").

Still, differentiation is difficult for many managers. For some, assigning relative values to otherwise well-performing employees may seem unfair. In fact, studies show that most managers who are satisfied with their employees' performance want to rate them all "outstanding" or "good."

The importance of seeing differences

As a manager, you likely understand that no two employees have exactly the same developmental needs. However, you may not know the critical role differentiating between employees—in terms of their performance and potential—plays in the success of your organization.

Distinguishing among employees allows you to:

• Appropriately address performance expectations. What is a realistic expectation for one employee may not be for another, even if they share the same job title.
• Draft suitable developmental plans. While some employees may need only stretch goals to provide them on-the-job challenges, others may need goals directed at improving their performance.
• Help direct reports manage their careers. Tailoring a development program to suit the specific needs of individual employees helps to maximize their chances of success in the workplace in both their current and future jobs.
• Better build a foundation for your organization's success. Knowing who your top performers are helps your organization focus its retention efforts.

Teaching: the virtuous loop

Throughout my career I have learned the essential nature of always trying to grow your own knowledge base. In my case, right off the bat in terms of when I became the CEO of the company   I had come up on the financial side. I was CFO, I had been treasurer, I started my career in banking. So I knew financial things. And the circumstances under which I became CEO was really just on four days' notice. So it was not a nice, smooth process, well thought out. But what I figured out pretty quickly was that the skill set that I had, the financial skill set, was important, but it wasn't going to be enough.
And if I had any hope of being successful as a CEO, I was going to have to view not only business but life in a much different way. And I was really going to have to learn and understand topics, quite frankly, that I had never been involved with before. So that, for me personally, was a transformation, if you will. But I then realized that the only way I was going to be able to do that is to reach out to individuals in the organization who, although I had known them, I really hadn't worked very closely with them.
I had to create an environment where they were comfortable teaching me, if you will, and sharing the gifts that they had. That was the only way that my own learning would be supported. And as time went by, and the years went by, I was more and more comfortable with that, and I noticed that people were happy to share the things that they knew. They were proud of what they had accomplished.
It was really a segue into creating almost a higher purpose for the organization that was all built around the sharing of the knowledge, and the linkage of that to leadership.
The link between leadership and teaching is one that absolutely cannot be broken. When we talk about the importance of leadership and teaching, I think what is really essential is not to look at those as two separate concepts. You need a broader definition of both. If you accept the premise, as we do in our own organization, that everyone is a leader, what you're really saying is everyone has to be a teacher as well. The concept of being a leader, again, is not for the highest echelon of the company.
And what I have found in many, many instances, the real learning opportunities are coming from the individuals who are closest to the customers, the ones who are there day in and day out handling customer needs. Because they have the real knowledge of what the business is all about. So in my view, to be a leader in the broad definition of every individual being a leader, you've got to have the ability to teach from your experiences, and that goes both ways. Without that, I think that leadership will then just be left as wispy, dream like philosophical concept, and it will never take hold.

Effective leaders not only teach others, but are willing to learn from others.

Larry Downes
CEO, New Jersey Resources
Larry Downes is Chairman of the Board and CEO of New Jersey Resources (NJR) and its principal subsidiary, New Jersey Natural Gas (NJNG). New Jersey Resources, a Fortune 1000 company with over $3 billion in annual revenues, provides natural gas and clean energy services to customers in New Jersey, and in states from the Gulf Coast to New England and Canada.
He joined NJR in March 1985 and was appointed Senior Vice President and Chief Financial Officer in January 1990. In March 1995, he was elected President and CEO of NJNG and a member of NJR's Board of Directors. In July 1995, he was named President and CEO of NJR. In September 1996, he was named Chairman of NJR's Board of Directors.
Larry received a bachelor's degree in business administration in June 1979 from Iona College, as well as a master's degree in business administration from Iona in June 1981. He is a Director and past Chairman of the American Gas Association and the Natural Gas Council, and a Trustee of the American Gas Foundation. He is also past Chairman and serves as a member of the New Jersey Commission on Higher Education.

Your role in development

 What I need is someone who will
make me do what I can. 

– Ralph Waldo Emerson

Effective employee development depends upon your ability to match employee growth opportunities with organizational needs. However, while you are responsible for guiding your direct reports' development, your employees themselves need to own the process of managing their careers.

As a manager, your role is to:

• Help guide your employees by helping to match their skills, business interests, and work values with job opportunities
• Conduct frequent discussions of developmental needs
• Give timely and specific feedback about an individual's performance against established expectations
• Provide opportunities for coaching, when necessary
• Act as an informal teacher by being conscious of the behaviors and attitudes you model
• Work with your employees to draft individual development plans

Your role in development

 What I need is someone who will
make me do what I can. 

– Ralph Waldo Emerson

Effective employee development depends upon your ability to match employee growth opportunities with organizational needs. However, while you are responsible for guiding your direct reports' development, your employees themselves need to own the process of managing their careers.

As a manager, your role is to:

• Help guide your employees by helping to match their skills, business interests, and work values with job opportunities
• Conduct frequent discussions of developmental needs
• Give timely and specific feedback about an individual's performance against established expectations
• Provide opportunities for coaching, when necessary
• Act as an informal teacher by being conscious of the behaviors and attitudes you model
• Work with your employees to draft individual development plans

Your role in development

 What I need is someone who will
make me do what I can. 

– Ralph Waldo Emerson

Effective employee development depends upon your ability to match employee growth opportunities with organizational needs. However, while you are responsible for guiding your direct reports' development, your employees themselves need to own the process of managing their careers.

As a manager, your role is to:

• Help guide your employees by helping to match their skills, business interests, and work values with job opportunities
• Conduct frequent discussions of developmental needs
• Give timely and specific feedback about an individual's performance against established expectations
• Provide opportunities for coaching, when necessary
• Act as an informal teacher by being conscious of the behaviors and attitudes you model
• Work with your employees to draft individual development plans

Consequences of neglecting development

Although the development discussion can be difficult, failing to address the developmental needs of your direct reports can adversely affect your unit as well as your company. For example, top performers, as well as competent performers, may:

• Feel neglected and unmotivated. If not given opportunities to grow or feel supported, the morale and motivation of these critical team members may begin to decline. As a result, they may view their work as less of a priority, and their work habits may deteriorate.
• Leave. If they don't see prospects for growth (which may exist, but which might not be immediately apparent), top performers may seek challenges outside your team—or organization.

At the other extreme, low performers may:

• Have a false sense of their success. If you focus on development instead of performance improvement with underachievers, they may assume that they are successful in the organization. These employees might then become disappointed when they don't receive promotions.
• Breed negativity. When they are not given promotions—and they don't know why—low performers may share their frustrations with others and spread resentment.

Similarly, there are consequences for you as a manager. When employee development is ignored, you:

• Miss the opportunity to align your employee's development with your organization's direction.
• May have unproductive, unhappy employees working for you.
• Don't have backup or "bench strength" among your ranks should a top performer leave.

Why managers neglect employee development

While an organization's employee development program usually originates in the human resources department, the success of the program lies in its implementation by managers. Unfortunately, managers often fail to adequately address their employees' developmental needs.

Why? Managers often feel that they don't have the time. In light of their busy schedules, they feel that, as long as their employees are meeting basic performance expectations, it is enough to address performance issues during annual or quarterly reviews. And unless employees actively seek them out, they often don't take the time to provide developmental resources.

Additionally, managers often avoid employee development discussions because these discussions are frequently difficult conversations for a variety of reasons. For example:

• Managers may feel uncomfortable talking to poor performers if they haven't figured out a clear plan of action for addressing their performance.
• Likewise, if there are no opportunities available in their group, managers may avoid talking about career development to high performers, as they do not want to lose them.

A new approach

A new approach

 You have to water the flowers
you want to grow. 

–Stephen R. Covey

Over the past few decades, the approach to employee development has shifted. Organizations have adopted more expansive models of what development looks like. Compare the old versus new approaches in the table below:

Old Approach	New Approach
Only poor performers need development.	Everyone in an organization can be developed, especially high performers.
Development is the responsibility of the human resources group.	Employee development is every manager's responsibility.
Career development focuses on moving capable employees up a predictable corporate ladder.	Career development focuses on moving employees through new challenges to strengthen their professional abilities.
Development means "training" (i.e., internal seminars or weekend workshops).	Development more likely means informal, on-the-job ways of learning, such as: "Stretch" assignments Job rotations Self-paced e-learning Action learning Manager coaching and feedback Mentoring

To develop your employees effectively, you must have certain skills, such as the ability to seek out opportunities, set goals, and provide feedback. Equally important, however, is your commitment to cultivating the potential of your employees.
As you strive to develop your employees, keep in mind that there is no one-size-fits-all approach. You must respond to your organization's unique business context and to your individual employees' values, skills, and interests.

Success depends on it

Key Idea
Developing your employees is critical to your organization's success. Research has shown that companies whose employees are inspired to work to their greatest potential yield the best business results overall.
Such employees have the energy necessary to generate fresh solutions to organizational problems. They also collaborate better to create innovative products, services, and processes.
Inspired employees generally take pride in their work and feel accountable for their unit's or organization's well-being. Because they are stimulated by their work environment, they also tend to be loyal to the organization.
Your organization's plan for developing employees is a key factor in attracting and retaining the best talent—those best equipped to add to your bottom line. If high-performing individuals feel they are being given opportunities to grow, they are more likely to stay, even during tough times.
Likewise, having a strong career development program in place helps an organization prepare for the future. Succession planning is no longer a process that involves only executive-level staff. Top organizations understand that their success depends on understanding who will be in place to take on what assignments—at all levels of the organization—in five years' time.

Businesses that neglect employee development tend to suffer for it. How does employee development contribute to business success?

Why Develop Employees? Different perspectives

Ask three people in your organization to define "employee development," and you will probably receive three different responses. For example:

• A direct report may focus on upward mobility (e.g., "What can I do to get a promotion?").
• Another manager may speak to employees' motivation, productivity, and engagement (e.g., "What can I do to keep my best workers from leaving?").
• A senior-level executive may address issues such as what it takes to retain and grow top talent to help lead the company in the future (e.g., "What do we need to do to ensure we have the people with the best skills in the right place in the future?").

Regardless of your vantage point, employee development can be defined as a process that aims at helping manage employees' growth. Ideally, this process is integrated with an organization's performance management program, but remains distinct from routine performance evaluations.