Thursday, August 28, 2014

Unraveling the Talent Myth

In July 2002 the New Yorker published an article called TheTalent Myth by Malcolm Gladwell. In this article Gladwell explores the shortcomings of a widely recognized management system put forward by a management-consulting firm called McKinsey & Company who advocate a three-tiered management process known as differentiation and affirmation. In this process of differentiation and affirmation employee performance is rated resulting in each employee being placed in one of three categories A, B, and C. The A’s, or talent group, are to be challenged and given generous bonuses as well as new tasks, new responsibilities, and new titles. The B’s are to be encouraged and affirmed, whereas the lowly C’s need to be let go.

The Problem… or Problems

There are a couple of flaws in this way of thinking that seem obvious. First, is that managers are encouraged to engage employees to do what the employees want and not what the employees are good at or have experience doing. Another flaw, which Gladwell points out, is that companies who are prisoner to the talent myth often move employees into new jobs with greater frequency than companies that are not tied to the same mindset, often spending less than a year at a particular job within the company. The result is that one employee’s range of responsibilities is changing so frequently that it becomes impossible to judge true performance.

Lastly, there is little correlation between a person’s IQ and job performance. The reason for this is the fact that IQ doesn’t measure a person’s competency to what Gladwell calls “tacit knowledge”. For Gladwell, it’s the difference between a school environment, where everything an individual is rated on involves working by themselves (writing an exam or an essay), versus a corporate environment where virtually everything is accomplished by coordinating many individuals around a singular goal.

Let the System Shine

It was McKinsey & Company’s belief that the best and most successful companies were those that adopted the talent mindset – the belief that the intelligence of a company was rooted in the intelligence of its employees. Successful companies were those that went out of their way to seek what they perceived as talent and that fostered that talent by molding their company to the interests of their most talented individuals.

As Gladwell points out, some of the most successful companies were those where the system, not its employees, was the star. As Gladwell writes:

“The talent myth assumes that people make organizations smart. More often than not, it’s the other way around.”

You Learn More on the First Day

My own experience has been that no amount of schooling has ever adequately prepared me, or anyone I know, for what it’s like to actually be out on the job. I’ve heard the old adage “I learned more on the first day on the job than I did in 4 years of university” so often that it’s become cliché. Coming out of college labeled as talent is a great thing and is capable of opening a lot of doors, but talent in school is only one type of talent.

The people I am constantly seeking are those that have broader, even hidden, talents. Someone who graduated from university with less than stellar marks, but did so while holding down a part-time job, or involving themselves in a bevy of extra-curricular activities, is just as impressive as an ‘A’ student. Also, with so much time spent together on the job I tend to try to surround myself with people who have complimentary talents or people that I genuinely like. Operating a business, especially a small business, becomes a shared experience and the people you work with become your family. No matter what might be on their CV, if everybody in the company is not on the same page, it will not be successful.