The attention surrounding new book Time, Talent, Energy has so far focused on the almost unbelievable fact that the most productive companies get as much done by 10am on a Thursday as average organisations do in a whole week. But, says co-author and partner at Bain & Company Michael Mankins, the book has more critical findings for HR: “I’ve become quite obsessed about talent, and I think readers should be, too.”
What was the idea behind the book?
People who are my age went through business school being taught that financial capital was what separated the winners from the losers. I was taught virtually nothing about human capital in business school. It’s only in the last few years, since the crisis in 2008, that financial capital has become super abundant for most companies in the western world.
The real scarce resources are the time, talent and energy of an organisation’s workforce and, more specifically, the great ideas that people come up with and execute every day. If you don’t manage that with the same discipline we were taught to manage financial capital, you’re unlikely to be among the winners in the next 30 years.
What it is about top companies’ talent management strategies that boosts their productivity?
We describe in the book the typical model for talent management as being ‘unintentional egalitarianism’. That means essentially they ‘peanut butter’ star talent across all roles and all teams, and star leaders across those teams. It’s unintentional, but that’s what ends up happening. We thought it was easy to explain why the best are better – they just have better people. But it turns out that the best and the rest have about the same mix of star talent; only about one in seven employees is a star.
What explains the difference – which is more than 20 per cent – is deployment. We call it ‘intentional non-egalitarianism’: pick the roles most important to delivering strategy, and concentrate star talent in those roles.
Teaming is a big deal as well. We asked executives: how do you assemble teams for mission-critical initiatives? The best companies were nine times more likely to say they ‘create assault teams of our very best people’. The rest were more likely to say teams were based on ‘who’s available’ or ‘subject matter expertise’. But if you don’t have your best people on your crucial teams, you can’t expect initiatives to be completed ahead of, or even on, schedule or on budget.
You’ve talked in the past about measuring leaders on a talent balance sheet. Is that realistic?
I think so. And the company that has gone the furthest is Dell. It noticed that teams who rated their leaders as inspiring achieved a 16 per cent difference in quota retirement [sales revenue] – which would equate to half a billion dollars in revenue a year across the whole firm. So now if you are rated as uninspiring for more than three review cycles in a row, you can’t be promoted. If the next person in line is hyper inspiring, you can be replaced and managed out.
It sounds brutal, but they’d say ‘we believe inspirational leadership can be taught so if you don’t improve it’s because you don’t want to learn’. And why would we want our teams to be subject to that? It hurts us financially, because productivity suffers, but it also hurts our turnover among team members. So what sounds brutal is actually humane, because for every employee the average experience is improving over time.