Chocolate and Gold Coins

Sunday, June 19, 2005

The Rising Star at Work

Suppose you run a large business, and you naturally want to hire and promote the careers of talented employees. However, you have a dilemma. You have a very talented and capable young employee who is much better than most of the mid-level managers that she reports to. In a just world, you would soon promote her above these mid-level managers but in the short-run she has to report to them. This is a real problem: those managers have an incentive to derail the career of the rising star.

Ideally, your mid-level managers would be more talented than your junior employees, but that can only happen if you don’t hire any really talented junior employees. Your mid-level managers are people who have worked loyally for the firm for twenty years and have some competency but not enormous competency. You had to promote these people at some point or you had to let them go, and it is never easy to let people go who are loyal and have a career-worth of human capital in your business area. But these people will definitely feel threatened by people with more talent rising up the ranks. They might turn to nasty office politics to protect their privileged positions.

The mid-level manager will not want to just fire the rising star: that would be too bold. The rising star could be helpful to the mid-level manager. He can try to take credit for the rising star’s work. He might try to pretend that the rising star is one of many people who are helping grow the business area of the mid-level manager even if she is the superstar who really responsible for almost all of it. He runs the risk of alienating the rising star, but the worst thing that can happen, if no one catches his deceptions, is that the rising star becomes disillusioned and leaves. The mid-level manager doesn’t really need the rising star, so he will take that risk.

For a director of a company, you might wonder why those people who seem to be bright and capable and you might have considered fast-tracking for promotion instead leave the firm. You might suspect that office politics is the culprit but how can you know?

Here are some strategies for combating the negative effects of office politics:
1. Insist that you employees do any important communication via e-mail. Even if they meet and talk, insist that any major decisions be written in an e-mail immediately after for clarity. The purpose of the e-mail is to create a paper trail that makes it impossible for either the employee or the manager to “re-write history”. If the manager later tries to claim that the employee didn’t do X, she can point to the e-mail that said that she should do Y instead. She could not be blamed for not reading minds.
2. Cue in on the most important clue that the mid-level manager is thwarting the careers of lower level employees: high turnover. This is a no-brainer, but it’s surprising how many firms are slow to pick up on this clue. Every time an employee voluntarily leaves, have someone outside the mid-level manager’s office do an exit interview. If the employee hints that the reason why she is leaving is that she was not treated fairly, look at those e-mails and see if you can piece together the story. Sometimes, the e-mails will tell a clear story.
3. For rising stars, consider creating a parallel track for promotion that does not go through the current mid-level managers. She might have the talent to create her own little business area. Mid-level managers will not feel so threatened if they know that the rising star is not displacing them.
4. If most of your mid-level managers are mediocre but you are still making money, then you might as well focus on hiring more people of that quality. It may be more trouble than its worth to get superstars. You have to pay them a premium to attract them and they will get frustrated and leave eventually. Some firms hire only the best and some firms hire the rest. Know what kind of firm yours is and stick to that strategy.
5. Have some people keep an ear on the grapevine. If all of the junior employees are gossiping that so-and-so is an idiot, you should be aware of this.
6. If you catch a mid-level manager in something unethical, don’t hesitate to fire him and make an example of him. You want to send the message that there will always be a place in the firm for good employees who stay loyal. However, you also want to send the message that working in your own interest and against the firm’s interest will not be tolerated.

This essay is based on my observations of a rising star I know (not me). I think the rising star should start her own firm and put the bozos she works for out-of-business.

6 Comments:

  • I'm going to save this essay of yours on my harddrive, for posterity (so that I can look at this some day when I might be able to use this advice).

    It's such a common problem...........and really has been taken to the extreme in Indian bureaucracy (where any competence is often punished). But then...there's no effort for efficiency or profit there anyway...

    By Blogger Sunil, at 6:29 PM  

  • I appreciate the topic choice, as this rarely gets reviewed.

    The key players of course are those at the top, setting the agenda. If they live and die by Machiavellian office politics, and choose subordinates for similar abilities to "play the game', the high-integrity-plus-gamesmanship old guard will choose low integrity-skilled gamesmen as their replacemnts, who then choose sycophants and pseudo-psycophant gamesmen (i.e. kiss-ups).

    While I fully agree with your position, this will never become widespread until businesses discover that, much like cheating your customers is deadly for business in the long run, mistreating your employees is bad for business in the long run.

    For now, my experience is that most firms have not yet discovered that crucial aspect of engendering employee loyalty. Rather, many still act as feudal lords over their serfs. I suspect that sort of power is simply overwhelming.

    By Blogger Pogo, at 1:01 PM  

  • Hi Sunil and Pogo
    Thanks for the nice comments. I think this is a topic that many firms should be looking at but they naively assume that everyone is just getting along fine and politics doesn't happen in their family.

    By Blogger Michael Higgins, at 6:21 PM  

  • This is the sort of stuff that inspired me to post this one:
    http://blogs.caseysoftware.com/?q=node/34

    In the 5 months since I left, 30% of the department has moved on.

    By Anonymous KC, at 4:00 PM  

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    By Blogger Gaurav, at 6:58 AM  

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