Zero Tolerance

This week’s Pearl of Leadership Wisdom is on Zero Tolerance.

People are our greatest asset. Yeah, except the ones who are liabilities.

He’s great…

The discretionary effort of people is what fuels companies. Not the contracted hours, not the bloody job description. It’s the sweat they put in when they are not really being paid. The diligence; the applied intelligence; the additional contribution. Over and above the call of duty. When they are motivated, turned on, inspired and driven. When they have a superb attitude. Not always super-skilled or experienced. But with a great attitude. These people are assets.

But sometimes so cruel…

On the other hand, we have the moaners and whiners. You will have one, maybe more. Think of them now. Somewhere along the line it went wrong. Maybe it went wrong before they joined. They suck up management energy. They suck up their colleague’s energy. They cast a pall. They have externalised their plight. It is someone else’s fault – the boss, the management, the fact that every boss they’ve ever had has failed to recognise their potential. These people are liabilities.

I can change him…!

I have worked in companies where we have tried to bring these people back into the fold. To turn liabilities into assets. They have been lavished with attention – from HR; from their manager; from their manager’s manager. Maybe some have been sent on courses. Plans have been written. Our fundamental faith in human nature tells us that, this time, this time, we will convert the liability into an asset.

I have watched this for 20 years. I have been as caught up in the “this time it’ll work” delusion as anyone else. Because I am an optimist. Maybe even an idealist. Sorry about that.

Nothing I say makes any difference…!

But it never has worked. The liabilities do not become assets. They never change. In my experience, it is worse than that. They atrophy. They see the time and money lavished on them as vindication of their victimhood. “Look at all this attention I’m getting. They have finally woken up to how badly I have been treated by every boss I’ve ever had.”

This is killing me…

I believe that many companies are destroyed by their people. Or at best hidebound, hamstrung and left to fester in the wastelands of zero-growth living dead companies like so many zombies in a schlock movie.  They’re not zombified by exchange rates, or inflation, or macroeconomic factors, or bad products or theft. They are slowly strangled by liability people who hit the company in three ways – by being unproductive in the first place and therefore just a cost; by dragging the assets down; by consuming management time and thereby leaving less of it for the asset people and the good projects that will take the company forward.

I can’t take it anymore…

There’s a tipping point. When the level of liability people swamps the organisation. It’s at different points for different organisations. But for all of them it’s very much lower than 50%. I would guess it’s about 20%. One in five.

It’s just not working out…

Simplistically, at Tolerance Ltd, where one in five of the people are liabilities, your people costs are 25% higher than the competition (four working, five being paid). At Tolerance Ltd, the management are only 80% as effective as the competition (20% of time being spent on the liability). Further, at Tolerance Ltd, the four asset employees begin to go off the boil because the liability is not being dealt with. They carry him. And they are sick of it. Because it is not fair. And their discretionary effort is applied less often and with less effect. In time, they are still good people, but their edge has been dulled by the liability.

I can do better…

Meanwhile, at Zero Tolerance Ltd, things are different. They love people. They understand they make the difference. And because they understand this they identify liability people very quickly and take immediate steps to understand why this is. If the liabilities can be fixed, they get fixed. If not, management manage that person out of the organisation. They do this not because they are heartless capitalist bastards, but because they love the asset people, and to allow these people to work in the presence of the toxic few is a crime.

Assets are only happily matched with liabilities on a balance sheet. With people, one destroys the other. Have zero tolerance for liability people.


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