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Dick Grote, Harvard Business School Press, 2005, 256 pages List price: $35, ISBN: 1-59139-748-0
Forced ranking—rating employee performance relative to how peers perform, rather than just against a set of formal standards—is so controversial that when Dick Grote researched this book, he found that many employers wouldn’t discuss how, or even whether, they use forced ranking.
The controversy arises, Grote says in Forced Ranking, because many employees and managers maintain that rating people in direct comparison to co-workers is unfair and subjective and seems to “pit people against each other.”
But Grote advocates forced ranking as a possible antidote to inflated performance reviews and the tendency of managers to lump everyone into a “fully satisfactory” mass. Most performance appraisal systems leave top performers feeling unrecognized and employees complaining that employers don’t deal with poor performers, he adds. But forced ranking, especially if it includes steps to terminate the lowest-ranking employees, can yield real improvements in performance, Grote says.
Forced ranking systems sort employees into groups, such as a top 20 percent of performers, a middle 70 percent and the lowest 10 percent—those employees at greatest risk of losing their jobs. Grote says nearly every organization that uses forced ranking also uses a separate performance appraisal system and that forced ranking should be a short-term measure until other talent management measures replace it.
Grote, chairman and CEO of Grote Consulting Corp. in Dallas, aims to help readers set up forced ranking systems, starting with an audit to determine if forced ranking is right for the organization.
Companies that use forced ranking must decide which employees will be subject to it—usually those in top positions—and must establish the criteria that will be applied in ranking employees against one another. Other decisions to be made include who will do the ranking, what to communicate about forced ranking to those involved and how to use the results—to develop “up or out plans,” for example, or to set pay.
Grote discusses how to train the people who will assess employees’ relative performance. A primer on forced ranking sessions looks at how to prepare, how to get discussion started, the risks of taking notes, the use of external facilitators and other ideas.
Making Innovation WorkTony Davila, Marc J. Epstein and Robert Shelton, Wharton School Publishing, 2005, 334 pages List price: $29.99, ISBN: 0-13-149786-3
Innovation. It’s magic, right? Some companies just have a knack for it, and others don’t.
Making Innovation Work argues that the innovation-as-magic idea not only is wrong but also could damage your business. The book covers how to design an innovation strategy, manage innovation, fight resistance to it, measure it, and structure incentive and recognition systems that reward it.
The authors, all of them consultants and academics with extensive experience guiding companies through innovation programs, offer senior managers three new perspectives:
An overview traces types of innovation, along with the pros and cons of each—from the threat of “rampant incrementalism” in companies pressured to churn out new products all the time to the risks of radical innovations that may never pay off. Readers get advice on diagnosing their company’s need and tolerance for innovation.
The book covers how to choose an innovation strategy—for instance, should you play to win every time, or does your business need a “play not to lose” strategy with more tempered, incremental change? Internal factors that influence your choices include your technical capabilities and funding. External factors matter too, such as your competition’s innovation strategy and the speed of technological change that can render innovations obsolete.
Advice on organizing a company for innovation describes how to balance the creative and commercial sides of a business. A checklist helps you decide if your organization’s creativity is blocked by problems such as budgets that don’t fund innovation throughout the year.
Readers learn how they can outsource innovation through business partnerships as well as organize innovation in-house and across business units. The book looks at policies and procedures to facilitate innovation and covers experimentation, prototyping and “structured idea management,” a process for ensuring creativity at work while screening creative output to get the best results.
Detailed examples show ways to measure innovation. A framework for an incentive system that rewards innovation includes setting innovation-driven goals and considering profit sharing or gain sharing as incentives.
The authors break out tips and case studies into sidebars for easy reference, and they draw on the experiences of employers as diverse as Starbucks, Procter & Gamble and British Airways.
Resonant LeadershipRichard Boyatzis and Annie McKee Harvard Business School Press, 2005, 272 pagesList price: $25.95 ISBN: 1-59139-563-1
You’ve developed your emotional intelligence to connect with others, and you’ve inspired your team to move together in a positive direction, all the while maintaining a good balance of optimism and realism. In short, you’ve acted like a resonant leader and likely have enjoyed success as a result. Give yourself a pat on the back, to be sure, but don’t think for a second that you’re finished developing yourself as a leader.
The toughest part of being a resonant leader, according to authors Richard Boyatzis and Annie McKee, is sustaining success amid constant demands, pressures and changes. Unfortunately, many leaders—even those who have achieved notable success in the past—have trouble adapting to new situations. As a result, they often burn out or fall into dissonance.
If, like many of the people whose situations are described in the book, you find yourself in one of these ruts, it’s time to renew yourself as a person and as a leader. “Reversing the slide into dissonance and keeping yourself energized as a leader are possible only through a renewal process,” the authors say, which consists of taking care of your mind, body and spirit.
Written for “leaders moving into resonance, or even rediscovering it after slipping inadvertently into dissonance,” Resonant Leadership identifies three traits necessary for the renewal process—mindfulness, hope and compassion—and describes ways to develop them.
Mindfulness.The authors equate mindfulness with emotional intelligence. Ways to become more mindful, they say, include taking time to reflect on your own thoughts and feelings—whether by meditating, keeping a journal or some other way—as well as being open to others’ opinions, especially during difficult situations.
Hope. The first step in cultivating hope is developing a vision and a dream, according to the authors. Then you must believe in your ability to attain the dream and must see the desired future as realistic and feasible.
Compassion. Being compassionate involves both showing and receiving compassion, the authors say. To develop compassion, begin by really listening to people so you can move toward a mutual understanding. A coach may be able to help you learn to listen more effectively.
There are exercises and activities throughout the book and in the appendixes to help readers develop a plan for renewal.
How to Manage Problem EmployeesGlenn Shepard John Wiley & Sons, 2005, 198 pagesList price: $14.95 ISBN: 0-471-73043-2
Glenn Shepard says the way for employers to manage problem employees is to get tough. He suggests that in many instances employees turn out to be a problem in the workplace because there are problematic characteristics in today’s continually changing workforce.
Shepard sees a workforce whose younger members include many who simply don’t like to work. Although members of the “silent generation,” born between 1925 and 1946, “valued duty, discipline, delay of gratification, sacrifice, conformity, and were loyal to their employers,” he says, baby boomers, now 41 to 59 years old, “rebelled against conventional family life and valued self-gratification and doing their own thing.”
The author describes those born between 1964 and 1982—Generation X—as cynical and distrustful of institutions. They “don’t value work for the work itself,” he says, and they “resent working after normal hours.”
Just arriving in the workforce, he says, is “generation next,” its vanguard members now 23. These youngest of workers are, he says, “far less independent … accustomed to being rewarded more for participation than achievement … the most inclusive and tolerant … the ultimate I-want-it-now generation.”
Shepard, who’s based in Nashville, Tenn., and gives management seminars throughout the country, compares employment to marriage. “The interview process is the dating phase, the probationary period is the honeymoon and termination is like divorce,” he says in How to Manage Problem Employees.
The author takes an aggressive stance on recruiting. He advocates making “every employee a headhunter for your company” and hiring away from vendors.
Shepard recommends that applicants and new hires sign various documents for the employer’s protection, such as an agreement to submit to binding arbitration of employment disputes and an employment-at-will document.
After the “honeymoon” phase, Shepard says, employers face countless daily challenges with problem employees. They range from cell phone use and eating at one’s desk to bringing personal problems to work and having conflicts with co-workers.
Managers should make sure employees know they’re subject to dismissal, Shepard says, and should use dress code policies to set boundaries and workplace standards. He presents examples of how increases in compensation can have negative effects on performance and on expectations of future earnings. But he says some types of compensation, such as large year-end bonuses, can be used as a retention tool for the short term, a way of keeping the “marriage” alive.
In some instances, though, “divorce” is the only solution for problem employees. When it’s time to terminate, according to Shepard, say as little as possible to the employee. And if the employee asks why he or she is being fired, your reply should be: “I didn’t fire you. You fired yourself!”
Compiled by Leigh Rivenbark, a freelance writer and editor in Vienna, Va.; Erin Binney, proofreader for HR Magazine; and Nicole Gauvin, editorial coordinator of HR Magazine.
Inclusion of a book does not imply endorsement by SHRM or HR Magazine.
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