The Curve of Talent

May 17, 2011

Back in 2005 at Brontes, I was working hard with our VP Engineering, Ed Tekeian, to convince a talented engineer to stay at the company and not take another job offer.  I was struck when the engineer said to us, “guys, I respect you, but I really don’t know why you’re making such a fuss out of my leaving.  I did a fine job here, but really only did what I was asked.  In truth, I’m very replaceable.”  Ed responded, “The more that you manage people in your career, the more you’ll find that it is very hard to find people who can execute well on what they are asked to do.  Don’t underestimate how valuable you are and how hard it will be to find a replacement.”  It was a very candid moment of talent assessment in which the bar of performance wasn’t innovation, but simply competently executing the expected job.  Ed was right, finding people who can do the job that is asked of them is quite hard.

When it comes to assessing talent, I’m not a believer in grade inflation.  Most people are C performers. C performers struggle to competently fill their role, but are somewhat productive with sufficient coaching. Hard to admit, but most people in the business world don’t have a particularly clear idea on how to do their job well.  It’s not just a question of experience.  I’ve seen very inexperienced people have a very clear idea of their objectives and find ways to deliver way above those objectives.  I’ve also seen extremely experienced people, who have been previously considered successful in a number of roles, but really don’t have a clear idea of how to deliver on their objectives within their function and be successful.  In many of these circumstances, when failing, these folks hide behind their experience to suggest that the objectives were unreasonable.  This problem isn’t limited to any particular type of job.  I believe this problem is true whether talking about senior executives or junior engineers.

The large company corporate world is filled with C players.  The term “Peter Principle” was coined to describe this phenomenon in which people in large companies are promoted exactly one pay grade beyond what they can competently do and then stay in that role for the rest of their careers.  Large companies thrive on inertia and the core job description of a large company employee is to keep that inertia going and do nothing to screw it up.  If last year’s top line grew 8%, the job is to grow it 8% again, not to figure out how to make a step function change and grow it 20%. In attempting to achieve that 20% step function change, there is high risk of a misstep that could lead to a decline in sales.  That’s simply unacceptable. 

Large companies fire those who get F grades, because they are not at all productive.  They accept C players, because they are somewhat productive with guidance and B players are hard to find. It is very easy for a C player to seem moderately successful when progress is largely based on inertia.   Large corporations celebrate B players who can competently complete their job with minimum coaching and maintain inertia.  These are the heroes of large corporations. Innovation within a function is risky and can threaten inertia.  

Large companies have very few A players.  A players don’t want to be at large companies because, more often than not, corporate bureaucracy and process not only fail to reward, but actually punish A players.  By putting the objectives ahead of process and politics, A players step on bureaucratic toes and don’t retreat based on false territorial claims.  Though there are exceptions, few large corporations create cultures that give A players room to win.  It’s not fun trying to innovate at a large company when co-workers feel that you’re threatening the core inertia on which the business is based.  They’ll say things like “that’s just not the way things work around here.” 

By contrast, startups have no inertia and need to create momentum from nothing.  This is a very different job. Startups don’t succeed with people who deliver at a minimum acceptable level.  There really is little room for C players in a startup.  Employees who are somewhat productive, with lots of coaching, take a spot away from potential A players that can make a major impact on the success of a startup.  Startups generally don’t even succeed with a team of only folks who understand their objectives well and deliver them competently – the B players.  Competence across a team is simply not enough to build momentum from a standing start and learn quickly to iterate on strategy and tactics.  To succeed, most startups need some core team of A players; folks who can “write the book and not just read it.” These are an incredibly rare breed of people who not only have a clear idea how to competently accomplish their functional objectives, but actually lead the organization to innovate and be world class within their functional area.  They raise the bar on the entire organization.

Those who suggest that startups should only hire A players are grade inflators.  They’re calling B players A players.  The actual A players are too rare for this to be a practical hiring plan.  I advise my portfolio companies to be cautious when hiring candidates from large companies and focus on people who have already proven they can be successful in startup environments.  Another successful strategy is to hire less experienced candidates who show enormous upside in their ability to innovate.  When managing talent, startups need to help C players transition out of the organization and coach B players on the need to not just competently deliver their function, but drive toward innovation within that function.  Most of all, celebrate the A players and give them the room to explore hypotheses and make mistakes.  When interviewing, seek hires that not only understand how to competently deliver functional objectives, but also want to innovate within their function to build momentum from nothing.  One way these candidates can be identified during an interview is when they actually teach the interviewer something about how the company can win.  The best hires are those who have time and again proven they can innovate in a startup environment.  That’s startup gold. When you find those folks, don’t let them out of the building. 

 

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37 Responses to “The Curve of Talent”

  1. Anonymous Says:

    Absolutely spot on. The A’s are almost impossible to find. The B’s are there if you have (make) the time to look. The C’s, well in a startup they only last a few days. Great post!

  2. Anonymous Says:

    Wow, amazingly great post, Eric. Thanks for this.

  3. Anonymous Says:

    Amen

  4. dkrecruit Says:

    “Energy and Persistence conquer all things” – Ben Franklin You will be rewarded for hiring a B player with both traits. a JFDI attitude goes a long way – especially in start up environment.

  5. Anonymous Says:

    Never could figure out why I didn’t do well in large companies. Turns out I was “A” all along.
    Really great article! I would add on the part of the less experienced, that if you meet someone like that “save” them from falling into the wrong (read large company) crowd. I have worked with less experienced people with great potential that would eventually wither in as they got comfy in the large corporate world.

  6. Anonymous Says:

    Great post Eric, and from what I’ve seen in the past dead on.

  7. Anonymous Says:

    A people hire A people.
    B people hire C people.
    The B people are not confident enough in their ability and don’t want competition.
    Hire one B manager and pretty soon you have lots of C people.

  8. Anonymous Says:

    Eric,

    Fantastic read.

  9. Ed Tekeian Says:

    Supporting staff is also very important in this story. You need people in those those roles. They make their careers more exciting by doing them in the riskier context of a startup.

  10. Anonymous Says:

    There are A-players in the corporate world but often, they get stymied and subjected to ridicule too. The people-managers in an organization must learn to recognize that, while wanting to nurture talent, there are different atmospheric levels enveloping the organization. You can’t handle the high-altitude filers the same way as you would the radar-avoiding zero-level fliers, can you? This applies regardless of whether the organization is “large” or a five-person startup. What also happens is that many Bs get “pushed” to “believe” they are As. So, the people-managers have to be able to recognize between the real As and the make-believe – that’s the challenge, really!

    But, who ever said talent management is easy!

  11. Anonymous Says:

    Very well said, Eric ! I relate lot of company and team functioning to sports and teams. If the role players don’t do their work the Sr. Management (veteran players) and rest of the company won’t go far. In start ups the sr.management trusts and is confident that the role players would do the job efficiently and execute in the right way. That was the big reason for Brontes success – young “B” players stepped up and did “A” player caliber work and now they have gone to shine at other start up companies.

    Quite often large companies suppress good young energetic talent, very sad !

    So, big question is when do you, Micah and Ed join forces again, had to ask.

  12. Anonymous Says:

    Brilliant.

  13. Anonymous Says:

    I like this post, but hope there is room for people from big companies (or perceived big companies, where the dev team is smaller) who might look like Bs but given the opportunity could be As. I hope I fit within that group.

  14. Anonymous Says:

    Ofer Gneezy is too right, allow me to reiterate

    A players hire A players
    B players hire C players

    B players are a necessity, but don’t let them make hiring decisions.

  15. Anonymous Says:

    Great article….those who have been involved in startups or have succeeded as leaders in theur own company…are good profiles as well

  16. meercat Says:

    Have you ever tried telling a large top tier investment bank that they only really have C performers, and that their gung-ho “only the best” processes actually squeeze out any A performers that might accidentally get taken in ?

    None so blind as those who will not see…

  17. Anonymous Says:

    Wow…this was wonderful. Maybe more so for me because I’d put myself solidly in the B+ or A- category. I excel at competence. It moved me from contractor to developer to tech lead to tech/team lead to tech manager. But my whole career has been about, what defines competence, and what can I do to be slightly beyond what’s expected for competence. At it nails me when I think about the transition from big corp to independent, even thought I spent quite a while as a contractor. And the reference to the Peter Principle is funny. We covered that in our comic recently: http://www.snrky.com/2011/04/peter-principle-in-action.html?spref=tw

  18. Anonymous Says:

    @Ofer Gneezy and Sir_HarryPearce

    If A players hire A players and
    B players hire C players
    Who the hell hires the B players?

    The flaw in this blog post is it doesn’t account for the gestalt of people. It’s possible for someone to be an A player in one role (e.g. technical) and a B or C player in another role (e.g. leadership, estimation, risk assessment).

    Hire the best people you can find that demonstrate as many of the talents you need. But don’t view folks as Pass/Fail.

    My own approach to hiring is based on something I read years ago (I think it was Joel Spolsky) that turned me on to the idea of hiring people who were 1.) Smart and 2.) Got Stuff Done. I’ve added a third criteria of the individual being a good fit to the corporate culture.

    FWIW I’ve been told I’m an A player but my self-esteem issues make me think I’m a B. 🙂

  19. Anonymous Says:

    @BigPigVT, A players hire B players sometimes in order to acquire domain expertise or even by mistake. The challenge is to either grow them or keep them as individual contributors.

    As Eric points out, large companies need Bs and Cs in the ranks and Bs in leadership roles. Startups need As and Bs in the ranks and As in leadership roles.

  20. Anonymous Says:

    Even in Startup companies I believe that you need to have A players in each function and limit the number of A players in each function to a few! Have B players supporting them. If there are too many A players in the same function, startups become lareg companies with too many arguments about the right architecture or whether C++ or Java is better, the right accounting tool or whether Salesforce.com is better than something else.
    Too many leaders and not enough followers!

  21. Anonymous Says:

    Thanks for posting, Eric.

    Seems like true A Players are not key team players for most organizations. Seems like they would be too disruptive to any mid-large size company….unless that person was at the executive level and could rally support around their vision.

  22. Anonymous Says:

    A, B, C, Z.

    This alphabet soup nonsense means absolutely nothing, is unrealistic and doesn’t take in account context and personal development.

    Can we stop spouting this stuff and focus on treating people like people and empower everybody to reach their full potential?

  23. Adrian Sanders Says:

    A, B, and C players?

    I really liked this post. But I think the whole lexicon is really whack.

    There are people who are incredible at actualizing and making certain things happen based on their interests, talents and abilities. Those people aren’t always going to be entrepreneurs per se, and may not exhibit many of the “startup” qualities at first run.

    Ultimately, I’m looking for excited, motivated people are want to be challenged.

    Maybe this will change when the company grows and we need to fill more “day-to-day” roles…

  24. Anonymous Says:

    There is no one formula for hiring talent but the “We hire the top 1% only” stuff is just narcissistic hype that makes insecure groups feel better about themselves.

    It’s really getting quite tiring hearing all of the start up leaders talk about how very special and different they and their teams are. Either they are socially stunted ego maniacs or the pitch is never over.

    Either ways it’s getting boring

  25. Anonymous Says:

    This system fails to provide any meaningful predictive power. A, B, C ‘players’ is an obvious and non-interesting metric. The wrong type of ‘A player’ can sink an organization right quick compared to a ‘do nothing ‘c’ type.

  26. Anonymous Says:

    What you’re saying makes a lot of sense and matches much of what I’ve seen, with a few exceptions:
    – Sometimes big companies have internal partitioning that allows some segment(s) to act more creatively than average.
    – Startups are often composed of ‘A’s and ‘D’s due to a belief that a couple of top performers will carry all the load and allow for trimming the budget at the other end of the scale.
    – Startups are very good at turning momentum into inertia as they try to emulate mature, successful companies — in the wrong ways as well as the right. Something around 3 years seems to be the norm. 🙂

  27. Anonymous Says:

    The book Topgrading recommends reversing the Peter Principle to turn B’s back into A’s and C’s into B’s. I have turned weak managers back into great engineers. Be honest, help the employee see that they are not meeting needs, and offer an opportunity for a better fit.

  28. Anonymous Says:

    As someone who has worked in both large and small company each wants As and Cs employees because each types brings success to their managers and VPs. In a small company the risk-reward difference is very sensitive. If you get a product out on time, we might go IPO, you might get a promotion immediately (not in years), stock options, etc… The rewards is sometimes an order of magnitude LARGER than their salary for success. If we dont release the product on time we shut the doors, you might get a check for two weeks pay and no job. In a large company managers are risk adverse. If you do really well and get the product out on time you get a slightly better bonus, if you dont you get a slightly smaller bonus. In this case the reward is an order or magnitude SMALLER then your salary. So the goal of large company managers is to keep their salary and everything else is secondary. If the company is growing, then the only risk to your job as a manager is a failure or pure ineptitude. A employees fail much more then B and C employees. A employees take the largest risks in making the product and company better, but fail (often temporarily) more due to this. Large company managers avoid any chance at failure at all cost since its one of the few ways they can lose their job.

  29. Eric Paley Says:

    This is very consistent with my experience.  Thanks for the great comment!

  30. Anonymous Says:

    Literally one of the best blog posts I’ve seen ever.

  31. Anonymous Says:

    Amen and agreed 100%!

    As a result of officially running an Internet marketing and consulting firm for the last year or so, I can readily attest to the fact that I would almost give an arm and a leg — almost — to find an awesome B player that could just take what I give them and implement with perfection…

    Alas, this is not always an easy thing to achieve, but the search continues!

    Great post.

  32. Anonymous Says:

    I’m skeptical of self-grading as A players. It’s great to aspire to be an A player. But if you’ve already decided that you *are* an A player, then you’ve already blessed your future decision-making. I’ve had a few A-player moments in my career, but I’m surrounded by people who have made brilliant moves that I might never have thought of. This skepticism helps me maintain a healthy sense of admiration and intimidation that keeps my competitive instincts sharp. By contrast, the people who came into my firm with A-player credentials have been coasting on those credentials for years, and they’re losing their upward momentum as a result.

  33. Anonymous Says:

    Matt, couldn’t agree with you more. I especially agree with the latter portion of your comment. Cheers.

  34. Anonymous Says:

    Well written, fun to read, lots of truth, but be aware.

    Classification schemes simplify complexity and help our brain function quickly and decisively, but the schemes are always flawed. I agree with the author that the simple A B C D F scheme does correlate with aspects of reality, helps label intuitive judgements, and enables many pithy observations (A hires A but B hires C, etc) but as mentioned by Matt and others, flaws such as self-grading and narcissism creep in, and some flaws can bring down the whole company. Example:

    Somehow, I got to be an architect in a world-class, A-only startup that would only hire a new person if every architect agreed the person was absolutely an A. The person I wanted to hire was classified B. I knew the person was a great engineer, probably better than me, so I fought for him. The company collapsed rather quickly from its A-only, change-the-world hubris, but I’m pleased that my hire went on to have an exceptional software career elsewhere.

    Some may conclude the architects must not have been truly A-class, but my point is, who’s to say? Even the press said we were.

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  37. Anonymous Says:

    I am no A player, a B player, but god how much I wish I would work in a start-up, trying to develop apps with all the information I read, and try to market it. Like doing career strategies with big five, mbti and harvard review papers. So much action, so much to create. If somebody know anything, please refer me to jhon902@hotmail.com at the New York Area. All the fun is out there and I am unable to be there!


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