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The Golden State Warriors and the Toronto Raptors went head to head in the National Basketball League’s Championship Finals this month. To hear those two names in the Finals shocked just about everyone. On the one hand, the Warriors were very familiar with Championships since they were in the Finals the last four out of five consecutive years and won. For good reason. They have some of the all-time best players in the NBA including Stephen Curry, Kevin Durant, and Klay Thompson. It’s a team that really favors promoting from within and home-grown talent. And, the organization fosters an extremely close-knit team culture where the hardest workers are invariably the best players. This approach allowed them to develop a nearly unstoppable team. Nearly.
The Toronto Raptors, on the other hand, were originally ranked in 12th place. The Raptors couldn’t keep star players and couldn’t attract free agents. Top players felt Toronto was too cold. As the only team north of the U.S./Canadian border, the Raptors were also “too Canadian” and therefore too different from any other teams in the league. After all, the Raptors once played in purple dinosaur uniforms. No one would have thought that the Raptors would end up in the Finals against the Warriors. But they did. What is more remarkable still, they won!
How did that happen? Most would agree that it wasn’t so much what the Raptors did as much as what the Warriors did and didn’t do that cost them the game. The main issue was a loss of talent at a key moment. Two of the Warriors’ top three star performers were seriously injured during the Finals. Kevin Durant ruptured his Achilles tendon in Game 5, and he had already been unable to play in earlier games. And Klay Thompson, who was having a brilliant game, tore his ACL in Game 6 when he went up for a dunk attempt in the third quarter. Without them, the Warriors tried but failed to best the Raptors. Even with their incredible roster of talent, the Warriors did not have a sufficiently deep bench of talent to be able to survive the loss of two of their three best players at clutch time. Loss of talent cost them a Championship.
Indispensable vs. Irreplaceable
It’s been said that no one is irreplaceable. But, you might not know it to look at how some companies function. Businesses typically rely on a handful of top performers to push the company forward. Unwittingly following the Pareto Principle, companies will give 80% of critical projects to the top 20% of their team members. Or 80% of their revenue is generated by 20% of the sales team. When 80% of productivity or revenue is driven by a mere 20% of staff, it places the lion’s share of the company’s results in the hands of few people. They become “indispensable” to the organization. Indispensable employees are those who are absolutely essential to the organization’s daily functioning and other people or processes cannot function with them. These are people who can neither be disregarded nor neglected.
The problem with indispensable is that it makes the company vulnerable to instability (or worse) if even a few key players are “out”, as happened with the Warriors at a critically bad moment in time. For a business, “out” can mean a temporary absence such as family leave or it can be a permanent absence if the employee resigns or retires or develops a chronic illness. In any of those situations, the loss of a few key players can have a devastating effect on the business. The goal then is to ensure that even the most “indispensable” employees have backups so they can be replaced quickly if the situation requires it.
Evaluating Bench Strength
To determine if a company is able to weather a loss of several key employees, ask these questions:
- Which positions in the company are staffed by those deemed “indispensable” to the organization? Again, these are people who cannot easily be replaced. It should be no more than 10% of the total number of employees. So if a company has 100 employees, no more than 10 should be ‘indispensable.’
- What is the financial cost involved in hiring a replacement for each of those positions? Since these positions are usually high level, salaries for those positions tend to be costly and replacing them can be as high as 10x the cost of those salaries.
- What is the cost for “loss-of-productivity” by indispensable people/positions? Since this could affect the entire company – as a number of staff members will have to shift their focus from operations to hiring – the cost could be substantial.
- How would these costs impact the business and how would the loss of an indispensable person affect the rest of the staff? When a company loses an indispensable person, everyone else must work harder to cover. This causes employees to become disgruntled and dissatisfied.
- How would a replacement for an indispensable person be found? How much time would it take? It can take weeks or months to find a replacement for a top level manager in a niche field. Expect to spend hundreds of hours recruiting, interviewing, and onboarding the candidate in the hopes that that person will fit.
Once these questions are answered, it should be clear that the cost of replacing indispensable employees is significant and time consuming. Instead, a company should think about increasing bench strength in advance instead.
Five Steps for Growing a Company’s Bench of Talent
- Assess the organizational lineup to determine which employees have the potential and desire to move up into higher level positions in the future. This is critically important for positions that are highly technical or specialized such as a top salesperson, Operations Manager, or General Counsel. Start with the positions that have a deep impact on the business and would be the most difficult to replace. For those indispensable positions, have a stand-in or deputy. No C-Suite Exec should function without an alternate, just as no theater production has a star without an understudy. If it is unclear which person on the team has the potential to fill a particular role, discuss goals with staff. Ask where they see themselves in 5-years. This is a fast way to identify those who are ambitious, driven and want to excel.
- Write or review job descriptions for all indispensable positions. It is important to have a clear job description for every job that is indispensable or hard to replace. This is most crucial when the cost of replacing that person is especially high, such as key managers. Some of the skills and traits required to lead may only develop in time. Ensure that such skills are nurtured early so that a back-up person can step in, if necessary, during a crisis.
- Hire judiciously. This is easy to say and hard to do, especially at a time when unemployment is at an all-time low, but hiring intelligently is key. Think ahead and make sure that everyone you hire has the potential for advancement. When hiring backups for any position, know what skills and experiences are required and find those who are well-suited to move up with just a little more training or development.
- Develop talent in-house. Spend money to train staff. Do it in-house. Do it with professional organizations. Do it online. Do it however it makes the most sense. But do it. Help team members get ahead. Allow every single person on the team to take on more responsibility and learn new aspects of every job in the department. Redundant systems, processes and people is a good thing for companies to have. No important task should be handled by only one or two people. Have a backup for the backup.
- Cross train staff. Every employee should have some training in sales even if they are in operations. Instruct folks who handle marketing to do essential sales tasks, such as inputting and following up with leads. Teach production coordinators how to do estimating. Show bookkeepers how to handle payroll. This not only ensures that multiple people know how to handle a particular job, but it also is beneficial for departments to see how other jobs function and fit within the organization.
These bench-growing exercises ensure that, in a crisis or crunch, there is a way for the company to move forward smoothly with existing staff. This inspires confidence in the organization. It also shows employees that there is opportunity for growth if they see a team member get promoted. This generates excitement about the opportunities that exist, which is particularly important to Millennials and I-Gens. In that way, building bench strength is a positive move for the company as well as for each individual on the team.
Quote of the Week
“I’ll bet most of the companies that are in life-or-death battles got into that kind of trouble because they didn’t pay enough attention to developing their leaders.”
Wayne Calloway, former Chairman, Pepsico, Inc.
© 2019, Written by Keren Peters-Atkinson, CMO, Madison Commercial Real Estate Services. All rights reserved.