111 – High performance: ‘The Best and the Rest’. Claudio Fernández-Aráoz.

Posted by Colin Weatherby                                                                         560 words


This is the title of a chapter in Fernández-Aroáz’s book ‘It’s not the How or the What but the Who’. It discusses the difference between a typical worker and a highly productive worker. I was surprised at the differences in performance between the best and the rest.

Fernández-Aráoz says that a ‘star’ worker in simple jobs, for example an assembly line, and a ‘typical’ worker is about 40%. The distribution of performance follows a normal distribution, or bell curve. The distance between the best and the rest grows quickly with increasing complexity of work. He cites a top life insurance salesperson as being 240% more productive than an average salesperson, and star software developers outperforming others by 1,200%. This performance is distributed in a long-tail, or Paretian curve.

normal and long tail

Image source.

His main point is that any profession, but particularly the more complex, has most people performing at a relatively low level with very few star performers. This normally makes those star performers highly valuable. Therefore, he says, it pays to be selective. He challenges readers to consider their own place on the curve.

“Average bosses, companies, colleagues, and challenges make you average.”

What implications does this have for local government? For a start, we have many complex jobs.  There is the potential for some people to be performing at much, much higher levels of performance in these jobs. But are they? What is likely to encourage and sustain or deter star level performance?

Most of the employee-related systems in local government – performance appraisal, selection processes, remuneration – are driven by the lowest common denominator. We are more worried about over-rewarding under-performers than under-rewarding over-performers. Senior officer performance bonuses were eliminated at most councils because they were publicly reported and CEO’s couldn’t defend their decision to award them. When we pick the wrong person or people cease to fit the jobs they were appointed to, we put up with it rather than act to resolve it. The trade unions resist management action to remove underperforming employees.   As a result, everything mitigates towards mediocrity.

Few CEO’s have the confidence to break the mould and genuinely reward performance. It is easier to accept the popular paradigm (i.e. that council workers are lazy and unproductive) and to pay low to reduce the risk of over paying under-performers.

In a later chapter, Fernández-Aráoz looks at equality of pay and describes a TED talk  where capuchin monkeys are treated differently for the same performance. It highlights the importance of the difference between fair and unfair compensation.

“Like those monkeys, humans expect to be compensated for the labor they provide, in a way that accurately reflects their contribution or effort and is comparable to what others doing similar jobs are paid”

In his experience unfair pay can demotivate but it is not the powerful performance motivator that many people believe it to be. He cites the work of Daniel Pink in understanding human motivation and the limitations of financial incentives in improving performance.

Fernández-Aráoz says that you should pay well and ideally above the average without relying on money for motivation. Instead, he advises picking the right people, giving them independent roles within the team, providing opportunities to master skills, and letting them pursue broader team and organizational goals.

How often has this happened to you in local government? Being the right person (more of us are recruitment errors than we think), having opportunities, being paid above average. Does it sound like your council?

Fernández-Aráoz, Claudio, 2014. It’s not the How or the What but the Who – Succeed by Surrounding Yourself with the Best.