ExecSearch International - Australia

ExecSearch International - Australia

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The Big Irony:  Why Top Performers Get Outplaced

Dr. Duff Watkins
Director ExecSearch International - Australia, Consultants to Boards and Management

Who gets outplaced and why?  Incredibly, the answer is often top performers and quiet achievers. In the corporate world, anything that distances you from your peers can negate you.  The Big Irony is that you really can be too conspicuously successful or too quietly competent for your own good. That’s why, believe it or not, companies do sometimes retrench their top performers.

The enduring logic of the Big Irony is that during tough times, conservative companies act conservatively, ie, they conserve, preserve and protect their core corporate values.  This means that companies will favour the familiar and predictable over the unconventional and nonconforming. Employees who for are conspicuous for any reason are scrutinised first, even if they are more efficient, productive and profitable than their peers. It is precisely because they stand out, over, or above their peers (and may cost the company more in salary accordingly) that they are examined first.

Since most companies are very conservative, their actions are predictable.  If the economy contracts and business takes a downturn, companies will shed staff. But based on what criteria? Group psychology mostly.

Why would any company penalise their performers? Because any group (i.e., company, profession, industry, etc.) acts first and foremost to perpetuate itself when in crisis. In the 1950s a charitable organisation named the March of Dimes was founded in the US to combat polio. Did the organisation disband when polio was cured? No. It simply found a new disease by which it could justify its existence. Does any government department or programme disband when it has accomplished its objective? No, it simply finds a way to justify its further funding. Business is the same.

Conservative companies act conservatively, especially in a periods of economic uncertainty. They act decisively to conserve not only their core business but their core values. Therefore it is not surprising -- and is even predictable-- that conservative companies react to economic recession by creating a more homogeneous and harmonious environment within their company.

Because top performers often bend rules and step outside established procedures in order to achieve good results, they often depart noticeably from the company's preferred practices. Top performers are also usually paid more than their counterparts. So when companies reduce "headcount", cut costs, and slash overheads, top performers are likely targets.

The point is that cutting back to core business means cutting back to core employees. Core employees are the ones who blend in most readily with the prevailing mood of the company.

The Big Irony also affects the quiet achievers. My study of the psychological profiles of retrenched employees reveals an interesting pattern: the employees seldom lack skill, energy or ability but they fail to broadcast internally their competence and achievements. So when the axe falls it's on the introvert rather than the extrovert, on the demure rather than the socially spontaneous person, on those who are task oriented rather than people oriented.

Many times I’ve sat around a board room table watching executives decide who will be retrenched and outplaced. All too often it is the person who is simply unknown to the management, who blithely trusts that doing good work is enough, and who is oblivious to the political dimensions of his/her company. The lesson is: if your political skills don't match your technical skills, you are in danger.

The largest reason for corporate restructuring and retrenchments is not poor performance by employees but a need for greater corporate efficiency.
And since is means that as companies continue to reconfigure themselves, today's "high flying" performer might become "yesterday's news" by tomorrow.

Here's how to avoid being retrenched.

First, fit in. Wave the company flag, sing the company song and achieve through established channels. Even US Presidents become unemployed if they can't fit in and get along with Congress. It the elected leader of the world’s only superpower has to fit in with others in order to be keep his job, you probably will too.

Second, become skilled in the art of self-promotion. You don't have to change your personality, be arrogant, or be super-competent. You just need to regularly inform others of your successes. Does IBM make the best computers in the world?  Hardly, but IBM markets its competencies well. Does McDonald's make the best hamburgers? Does Coca-Cola make the best beverage? Do you get the point?

Third, pay attention to politics. You don't have to be a Prime Minister or President to know that every job has a political dimension that is as important as the job's actual tasks. Politics are all around you and are easily identified in the company's corporate culture. So pay attention.  Remember, if you rub against the grain of a corporate culture, it’s you that will end up wearing splinters.