Promoting the right people

Promote people based on the needs of the company and the quality of the work. Give raises based on changes in competitive wage landscape to retain the employee. Give one time bonuses to reward exceptional performance.

Once you manage to successfully hire the right people, be careful to not promote the wrong people. Second only to poor hiring decisions, I have seen dozens of bad promotions stifle growth in companies and in departments of huge corporations. More often than not this is a combination of promoting the wrong person and not promoting someone who should be promoted. They tend to go hand-in-hand and create a toxic vortex for the company.

While I’m on this topic let me mention what gets many well intentioned business leaders in trouble. Promoting based on someone’s idea of fairness. Note that I didn’t say deserve to be promoted above, I said should be promoted. Meaning, should be promoted for the benefit of the company. The phrase deserves promotion, which is often heard during HR briefings and yearly reviews, should be eradicated from business speech. No one deserves a promotion. The actions that an employee took should be judged, and if the company has benefited by decisions or actions that person took while in their current role, then a promotion may be a good way to move them up the chain so that their decisions and actions positively affect the company in a bigger way. The benefit of a promotion should be for the company. The increased salary and title may be benefits for the employee, but they should serve no consideration in the context of the decision to promotion. Furthermore, If the promotion comes from things like working X number of years in the company, not earning a high enough salary in a previous period, or having problems with the current team, then no, no, no a promotion should not happen.

In a later chapter I will cover what should be done about people that never seem to get promoted, but for now let’s review when someone is a good candidate for promotion.

Promoting based on performance

Please keep in mind that performance at one job may not be a perfect indicator of a person’s ability to do another job, but the closer the two jobs are, the more predictive an indicator it will be.

Someone might have said that already, I’m really not sure, but I do believe it to be true.

Performance on a job comes from a person’s ability to execute the tasks necessary for that role, as defined by the company, in an efficient manner, with the most consistency of output. Some companies will have Six Sigma or Deming based processes in place to ensure that performance is job one. Ya, someone may have said that too.

It is obvious that an employee who is able to perform their job well is an employee worth keeping. So the question is, should you risk taking someone who is doing a great job, out of that job, and move them to a job where that they may not perform as well. In the end there is always risk any time an employee is moved around, but the key point to remember is don’t just decide to promote someone based on how well they are doing their current job without also evaluating the skills which will be necessary for the new role – otherwise you set them up for failure.

Promoting based on ability to adapt

The ability to adjust within a changing role does not translate into someone equally good at all roles.

People rarely end up doing the exact job they were hired to do. More than likely the company’s needs changed at least somewhat from the time they were hired and so there is a constant need for adjustment to a changing environment. Some people see an employee who is able to adjust well and go overboard in thinking that the person can now take on any role whatsoever in the organization. This belief is generally proven wrong to the financial detriment of the company.

Taking someone out of sales to do technical support may work, but compared to keeping a good salesman where he is and bringing someone else to do support should result in a better financial outcome for the company. Adaptability is much more important at the beginning of a company’s life, but as the company grows toward $5mm specialization is often far more important and by $25mm even more so.

Promoting based on people skills

Evaluate the quality of the job an employee is doing first and foremost, then secondary skills they may have, which are not a requirement of that job, before considering a promotion.

Some people are much better at dealing with customers and co-workers than others. We may call them people people, or extroverts, or empathic – one way or another they seem to get along well with everyone. While this skill is important for some jobs

like Sales and HR, I would caution against promoting someone who is in a job that does not require interacting with others, to a role where they need to get along well with others. I have seen companies where the CFO role was held by someone who was actually worse at the job than junior people in the department, because they were promoted for being a people person.

Now this is not to say that if you are going to move someone out of a technical role to a management position that people skills are irrelevant. To the contrary, someone you are considering for a move to a role with more social interaction should be evaluated on their social skills. So always consider the role you are needing to fill first, then fill it with the person who has the appropriate primary skills, and preferably someone who has demonstrated success in general. That is a winning combination for a promotion, and incidentally does not have anything to do with how long the person has worked at the company or whether others have been promoted over them.

Excerpted From The Original

Business Growth Roadblocks: How to use uncommon sense to surpass $5 mil

It’s not always the sales side that is the problem, quite often it is the operations that are keeping a company from growing, but majority of books only address the sales side. This book looks at the most common problems in company operations and how to fix them. The book is written primarily to address companies of $3-5mil with 8-20 employees who seem to have slowed down the growth, and it illustrates how others have grown past that size by changing back end operation.

 

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