June 22, 2016
Citadel’s CEO Ken Griffin has long credited the firm’s success to the Citadel’s most important asset: its people. In part four of this series on career development, Ken talks with Laszlo Bock, Google’s Senior Vice President of People Operations and author of the book, “Work Rules!”, as they discuss how to evaluate a new hire’s performance.
Editor: As the manager of the organization, where do you spend the bulk of your employee development time? Is it with your top performers, the middle tier, or the struggling employees?
Ken Griffin: Fifteen years ago, I spent a lot of time with struggling employees. Then a coach told me I was approaching this wrong. Why? Because if I make one of my top performers 10 percent better, I dramatically improve his or her impact on Citadel. If I make one of my middle or lower performers 10 percent better, it won’t move the needle.
My advice is to spend your time developing and challenging your best people. For your company to really excel, and for your teams to really perform, you need your best people to play at their absolute best.
Editor: Laszlo, what do you do at Google with employees who are underperforming?
Laszlo Bock: A couple times a year we review our employees to find out who’s struggling. Once we know who is underperforming, we reach out to them and ask, “How can we help you improve?” After this conversation, about a third improve back to mean. We move the remaining two-thirds to a different job in the company, and about 80 percent of the time their performance also reverts to mean. The rest we let go.
We spend so much time focusing on the bottom because moving someone from the 30th percentile to the 50th percentile is a huge improvement in performance for us. Also, our hiring costs are high. And when people aren’t performing well at Google, it’s not because they’re incompetent. It’s because they or we have not matched their skill set to the right job.
Next: How to cultivate an entrepreneurial culture.