A PLAYERS OR A POSITIONS?

Strategic Logic of Management Workforce

INTRODUCTION:
Great workforce of a company is made of great people and this is the reason why companies devote their energy to Identify Develop Retain What is known as their A Players It should be noted that it depends on the right talent at A position rather than filling all the places with A kind of people. By right talent we mean: Ability to deliver A performance in crucial roles To Manage A position requires proper and intelligent management of B and C position as well

 Economists believe that WAGES reflect the value an employee creates for the company and the scarcity of such labor in the market.

Human Resource on the other hand believes that the important positions are the one which are held by Highly skilled Hardest working Exercising the most responsibility Operating the most challenging environment

PARAMETERS TO DEFINE STRATEGIC POSITION:

1). Their should be clarity on the strategy of the organization: for Example: Competing on Price? Or Mass Customization? Or Quality? Etc. 2). Then there is need to understand the strategic capabilities of the organization: Technology Information needed Skill set etc. to create the added advantage Ex: Wal-Mart:- Low Cost Strategy Requires:- State of Art Logistics, Information System and Managerial focus on efficiency and cost reduction

 It is very essential to employ your Superior talent which gives you competitive advantage in those few jobs which you use to execute the HIGH LEVEL STRATEGIES. Not having identified the A positions- is similar to mismanaging the workforce of an organization by rewarding high performers in NON STRATEGIC JOBS or keeping the B and C workforce in critical roles

THE BASIC IDEA:

Identify the A workforce-the most essential to an organization and scattered all over the organization at all levels- probably less than 20% Actively develop and compensate the high performers in those roles Move the C players out of the A position replacing them with top talent. Help B to elevate their performance to A level

Example of identifying A position:

Nordstrom Strategy- Personalized Service and Advice A position is: Front line Sales Associates Costco Strategy- Low Price and Product Availability A position is: Purchasing Managers Role

MANAGING THE A POSITION:

Evaluation: Differentiate High Performance and Low Performance in each A position. Measure People on those criteria's
Development: Actively Develop people in A position by providing Training and opportunities. Compensation: Generously compensate the A positions Succession: Build Bench Strength for each A position.

 A job has to meet the dual criteria of: Strategic Impact + performance variability A position which increases Revenue or reduces Cost- A position B positions are those which are either indirectly strategic through their support to A or are potentially strategic but currently exhibit little performance variability and therefore offers little opportunity for competitive advantage. C positions play no role in companys strategy, have little effect on the creation or maintenance of values and is not needed at all

MANAGING THE PORTFOLIO OF POSITIONS

To say that the management should invest disproportionately in A positions does not mean to ignore the rest of the workforce. Since B is indirect help to the strategic A and potential for becoming A positioned Also the process of eliminating C players we need to slowly weed out the C positions also by way of outsourcing. The ultimate aim to manage the portfolio is: Right person- Right Job Paying full attention to A positioned people

CONCLUSION
Thus it is very evident that maintaining the A position is very essential for the organization since these are the positions which directly impact on the business and add value creation B position also needs to taken care of since they are the support function to A and thus should be developed into a potential A position C on the other hand should be eliminated by way of outsourcing since it does not add any value to the strategy of an organization but also increases the cost.

DIFFERENTIATED STRATEGY IS VERY IMPORTANT TO HAVE A COMPETITVE EDGE IN THE MARKET. THUS THIS DIFFERENTIATED STRATEGY SHOULD ALSO BE BETWEEN TREATMENT OF PEOPLE AND POSITION. BUT IF ANY OF THE FOLLOWING POINT EXISTS IN THE STRATEGY MAKING THEN WORK HAS TO BE DONE
POSITIONS
Description based on history not strategic value Positions are paid at market mid point Recruitment and retention involve same budget and effort Same selection process for all positions

PEOPLE
Performance evaluations rarely age completed or on salary review Most of the employees rated same Forced distribution of rating is used Middle rating means: proficient or successful and receive regular pay despite being rated average Both tough and lenient raters operate without consequences Poor performers stay yet dont improve Top managers not rigorously evaluated

Little developmental rotation occurs C positions eliminated or outsourced

FRAMEWORK TO DEFINE CRITICAL POSITION

FACTORS
Defining characteristics of a position

STRATEGIC POSITION
Has Strategic impact AND Exhibits high performance variability among those in the position Representing high potential

SUPPORT POSITION
Indirect impact by supporting strategic position and Minimizes downside risk by laying down the foundation for strategic efforts Potential strategic impact but exhibits little performance variability

SURPLUS POSITION
May be required by the firm but has little strategic impact

Scope of authority Determinant for compensation Effect on value creation

Autonomous decision making

Specific process or procedure to be followed Job Level

Little discretion in work

Performance

Market Price

Creates value by enhancing revenue or reducing cost May be very Costly but revenue opportunity missed is a bigger loss Significance expense in training investment and revenue opportunity

Support function to value creation May be very costly and can destroy value

Has little or no positive impact

Consequences of mistake

Not necessarily costly

Consequences of Hiring Wrong people

Fairly Easily covered through hiring a replacement

Easily covered through hiring of replacement

Parameters
Characteristics

Sr. No.
1.1 1.2

A position- Strategic
Has Strategic Impact Exhibits High Performance variability with High Potential

B position- Support
Indirect Strategic Impact By supporting the Strategic Position
Minimizes Risk by laying down foundation for Strategic efforts Potential to become Strategic Impact

C position- Surplus

May be required by firm to function but has no or very less strategic impact.

1.3

Authority

Autonomous Decision Making

Specific Process or procedure to Little Discretion in Work be followed

Basis Of Compensation

Performance

Job Level

Market Price

Value Creation

Substantial Increase in Revenue or Minimization of Cost

Supports the Value Creating Position

Has little or no positive Impact

Consequences of Mistake

5.1 5.2

Very Costly to the organization Greater loss due to the missed revenue earning opportunity Significant expense in terms of a) Training Investment

May be costly and can destroy value

Not costly necessarily

Consequences of Hiring Wrong person

b) Revenue Opportunities

Fairly Easily Recovered by Hiring Easily Recovered by Hiring Replacement Replacement

Strategic ImpactAny Role which creates a direct impact on the Strategy or Planning of An organization is known as Strategic Impact + Before Defining which position will have a direct impact. The strategy of the company has to be defined along with identification of strategic
capabilities A) Price B) Mass Customization C) Quality Strategic Capabilities: Technology Information Skill set to create competitive advantage Example Wal-Mart Strategy: Lost Cost Strategic Capabilities Required: State of Art logistics, Efficient Information System Once Defined then The Critical Job is defined Example: Nordstrom: Strategy: Personalized Service with Advice Critical Position: Front Sales Executives essential to have variation in job which represents High potential. Raising performance of the people through Learning, Training in critical roles = High Dividends Many B players are former A players stepped down to balance work-life. They are highly skilled brokers Really essential and are considered consultants at time of crisis -since they have vast experience Need to keep players motivated: Allocating resources-coaching, promotions to highly skilled B players * essential to employ your superior talent to give the best result from the few critical jobs identified to execute high level strategies

Performance Variability

Performance Variabilty

B positionSupport

Key/critical positions are those that: 1.) exert critical influence on the operational activities or the strategic objectives of your organization, and 2.) have characteristics unique to your organization making it difficult to fill from the