How tackling tricky conversations around performance will help your business grow 

Dominic Monkhouse

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Want your business to be in the top 5% of your industry? Do you have a sound strategy and goals in place? Are you shooting for the stars? Then one thing’s crystal clear. You’re going to need exceptional people to get you there. Sounds obvious, but it’s fundamental. 

Cognitive talent exists on a power law rather than a bell curve – it’s exponential. Talented, engaged A-Players are at least 5x more productive than average. And they won’t cost you significantly more. 

Yet too often, our clients are settling for average performers. I recently talked to a CEO about a team member, and he said, ‘Yeah – they’re good, I guess.’ ‘OK,’ I replied, ‘What does that mean?’ It sounded like damning with faint praise. When I pressed him further, he told me nothing was wrong with this person’s performance; it was just that no one liked them. So I told him he needed to face this with a difficult conversation. Otherwise, it would act like a drag anchor on his business.

Don’t avoid tackling issues around performance and fit with your team. It’s easy to bury your head in the sand and hope it will improve. You’ll be waiting a long time. If you’re serious about growing your business, you must better face these conversations head-on.

Start with the Executive Team

As always, these things start at the top. I don’t believe a business can be better than its leadership team. If you’re a business leader, this has to be the first place you look at performance. Every member of your top team needs to be an A-Player. Only then can you be an A-Player too. 

Ask yourself two questions for every member of the executive team. ‘If they resigned tomorrow, would I be disappointed?’ and ‘Knowing what I know about them now, would I rehire them in 2023?’ There needs to be a resounding ‘yes’ to both of these. Any ‘no’ answers mean that person will hold you back. Even if you pause, it’s a ‘no’ because it wasn’t an obvious ‘yes’. You need to take action straight away.

So start having the tricky conversations at the Executive level and then move down the ranks to all the managers in your business.

Know what great looks like in your business.

Fundamental to any tricky conversation about performance is a framework so you know exactly what defines an A-Player in your business. Then it will be easy to stick to the facts and make it crystal clear how someone needs to improve.

Firstly, put in a behavioural framework that links with your core values. I’ve written before about Jim Collin’s ‘Mission to Mars’ and the ‘Sabotage Technique’, both excellent tools to dig into the qualities you’re looking for in your people.

Secondly, introduce KPIs and job scorecards at a team and individual level so you can accurately measure performance against agreed benchmarks. This will remove the emotion from any difficult chats as you can clearly point to areas where people fall short. 

Make clear the consequences for continued poor performance.

You need to be open and honest in performance conversations. Is their job on the line? Have you clarified this to them early enough so they can do something about it? All too often, people are told this too late. Yet with some coaching, it may be possible to turn things around.

I recently chatted with Annie Duke for my Melting Pot podcast. She’s a former professional poker player and author of two excellent books, Thinking in Bets and Quit. We dived into why it’s so difficult for CEOs to fire people, and she had an excellent recommendation. 

Firstly, sit the poor performer down and ask them if they think it’s working. Nine times out of 10, they will know where they fall short, so get them to articulate this first. They probably have a spider sense that things aren’t perfect. Get them to commit to some targets to improve over 60 days. Check in every week to see what progress they’ve made. Annie reckons that 60% of them will go on to resign, saving you a difficult firing conversation.

Don’t tell average performers they’re amazing.

Too often, I come across businesses that lionise average performance. Just by doing their job well enough not to get fired, people are rewarded. It’s like schools that give a medal to everyone on sports day just for showing up.

A phrase I often use is, ‘7s will kill your business’. People get graded as a seven on a 10-point scale and pat themselves on the back. The organisation is allergic to proper performance conversations from the CEO down. No one is being honest about anyone. So when these 7s don’t get a pay rise, they get annoyed.

But know this. That average-performing B-Player is blocking the seat of an A-Player. And as A-players are exponentially more productive than B-Players, this will drag your productivity down. You must have open and honest conversations with them about raising their game. Or they need to vacate that seat.

Coach your managers to have difficult conversations.

It’s a natural human instinct to avoid anything that could be perceived as confrontation. So your managers will need coaching on how to handle difficult conversations. Most important is to stay calm and unemotional. Stick to the facts and make sure you’re direct and clear. 

If there’s an A-Player already in the team, it will give the manager a benchmark. If Mary is a 9, you want everyone else to emulate her performance. At Amazon, they include these benchmarks in their hiring decisions. Will the recruit raise the average performance of the team? To join Amazon, they should always be above average. Likewise, you should be working on improving the performance of all team members. Over time, this will raise the bar so that the average increases, taking overall team performance with it. Larger companies look for at least a 10% improvement in productivity year over year. 

Confront character issues with the ‘Circles of Trust’ exercise.

There are a variety of excellent tools you can use to guide tricky conversations. I like to use the ‘Circles of Trust’ exercise when it’s a character issue. Draw three concentric circles. Put yourself in the centre with any other team members you trust. In the second circle, put people you neither trust nor distrust. And in the outer circle, those who you actively distrust. When coaching Executives, I get the whole team to do this and then ask them to share it. If looks could kill, I would be dead on the spot! People hate doing this. They feel betrayed.

But I’m encouraging them to have a difficult conversation in a controlled environment. By doing this, we surface the undercurrents of disquiet in the team so they can be confronted and dealt with. You’ll only do this by forcing people to ‘have it out’ face to face.

Use ‘Stop, Start, Continue’ for feedback.

You want all team members to feel they can comment about their peers’ performance. Yes, these conversations are hard. But they need to be had.

This is where it gets uncomfortable. Another tool to navigate this discomfort is ‘Stop, Start, Continue’. I ask them, ‘In the context of making this a high-performing team, what behaviours do you bring that the rest of the team want you to stop, start, and continue doing?’ 

It gives me a sense of who the truth tellers are in the team. These people will always tell you if you have spinach in your teeth or your flies are undone. I’m always in awe of these people. How do they do it? When I was MD at Peer 1, a couple of colleagues had this innate ability to cut through the crap and get straight to it. This can be useful!

These techniques will build your managers’ ability to navigate tricky conversations. It will only happen through practice, making it a cultural norm. Once it’s second nature, productivity, engagement, and performance benefits will be huge.

Written by business growth coach Dominic Monkhouse. Find out more about his work here. Read his new book, ‘Mind Your F**king Business’ here.