In Hollywood’s version of the workplace, you, the star performer in your division, would start out being dissed by the bad guy, the CEO’s pet. At the end, though, you would triumph, and everyone would stand up and applaud your true worth as the music swelled.
But off-screen, alas, there’s an acute shortage of red carpets. Few companies attract, value, or reward top talent, says a McKinsey & Co. study (an update of a 1997 report) of nearly 7,000 managers at 35 U.S. companies, conducted last year. Only 7% of respondents strongly agree that their firms have enough talented managers to pursue promising business opportunities, and a slim 14% believe that their companies attract highly talented people. A meager 3% of respondents to both the 2000 and the 1997 studies say that their organizations develop talent quickly and effectively.
Last year’s study found that firms that nurture stellar employees outperform their industry’s average return to shareholders by 22 percentage points. What’s more, “A” players — managers who rank among the top 20% of performers — bring in far higher profits and revenue than average workers. Top-notch plant managers at a manufacturing company hiked profits by 130%, and outstanding operations managers at an industrial-services firm achieved increases of 80%. If you pay an additional 40% to hire an “A” player, the McKinsey researchers assert, you could gain an overall return of 100% or more within a year.
In 1997, 71% of respondents said that candid feedback about their performance was vital to their development, but only 32% reported receiving it. Last year, 89% said that feedback was important, but the number receiving it increased only slightly, to 39%.
Pooh-pooh these findings at your own risk. Bad performers (especially bad bosses) cause better ones to flee. Fifty-eight percent of the respondents to the 2000 survey report having worked for mediocre people; the experience made 86% want to leave the company.
For more information, visit the McKinsey Web site at www.mckinsey.com.