CEO Confidential

When Identifying Leaders, Performance Matters – But Don’t Ignore Tenure

In October, 29-year-old David Knopf stepped into the role of CFO at Kraft Heinz. Why was this huge company — one of the oldest and largest packaged goods businesses in America — willing to hand a high-powered job to such a young candidate? Because it is so focused on meritocracy, and Knopf had “delivered extraordinary results” leading the company’s Planters peanuts brand.


The concept of rewarding the most capable people goes all the way back to Aristotle. His term “ethos” was all about putting the most competent people into positions of power. In today’s workplace, “meritocracy” simply means compensating and promoting the employees who achieve the best results, conflating “most capable” with “the best numbers.”


But if you buy into this misperception, you risk damaging your company.


Merit Is Just One Factor


Rewarding great work with more responsibility is a solid way to build your business while ensuring that top employees receive the recognition and challenges they deserve.


However, employers and company leaders need to look at the bigger picture when it comes to moving mid-level employees into leadership roles. While performance should always be a part of the equation, the length of time an employee has been with your team should also play a prominent role in that decision.


You wouldn’t want to broadcast that your focus is on product quality and repeat business (which it should be), and then promote people just because they brought in a lot of money one quarter. To really drive home your vision of success, you have to make it clear to everyone in the organization that people are moving up or getting raises because their actions are impacting the company’s accepted definition of success over the long haul.


That doesn’t mean legacy employees automatically move up — a particular number of years on board shouldn’t guarantee their ascent to a certain position. Tenure and achievement are equally important, and you should consider both when deciding who should be promoted.


How do you identify the ideal blend of dedication and results? Here some strategies I’ve come up with after years spent building my own high-performing team.


1. Capitalize on the Strengths of Highly Engaged People


Employees who have been around longer tend to have built stronger relationships throughout the company. When your managers and leaders have a deep knowledge of everyone’s skill and expertise, it increases their ability to collaborate across departments, which, in turn, helps break down barriers and eradicate the siloed mindset.


Collaboration has become even more important in recent years, as technology continues to shift the competition from local to global. Nonetheless, employees always want different things and have different styles of working together. Sometimes a manager who is well-versed in the ways of your company can serve as the missing link that helps employees cooperate and pushes them to innovate.


You need managers who know everyone well enough to blend all of those distinct styles seamlessly into a team of complementary players. To find someone with that kind of insight, tapping successful, tenured employees is often your best bet.


2. Focus on Proven Culture Champions


Tenure and culture go hand-in-hand. “Performance” can entail many different things, depending on your industry. But if you focus only on numbers and analytics, you’re going to miss out on important intangibles. 


You want your leaders to replicate, embody, and promote your company culture. Although an excited and enthusiastic new hire might reach this level of understanding and behave in accordance with your core values right away, you want to find the employee who has demonstrated a full integration into your company’s way of doing business repeatedly and over a longer term.


It may be tempting to reward and acknowledge those who always do whatever it takes to see results — they do bring in good numbers, after all. But in my experience, those employees often perform better if you allow them to continue doing what they do so well for a time. Let them grow into seasoned veterans before you consider them for leadership positions. Your leaders need to be true champions of your culture, not mercenaries.


3. Promote Tenure to Foster Loyalty


By this, I don’t mean the blind corporate loyalty we all love to hate. Fostering loyalty means helping the most effective culture champions find a path toward reaching their career objectives within your company. That’s how you keep them around.


You don’t want your best people to feel stuck. According to a recent study conducted by Glassdoor, just 10 months of role stagnation significantly increases the likelihood of an employee leaving one company for another. When hiring for leadership roles, consider current employees who are good people managers and hard workers, but who might not have the highest numbers.


Promoting a newer employee who has had a strong — but brief — run of success could push some of your best culture fits and highest-performing employees right out the door. It might give them the impression that their career trajectory at your company is a flat line rather than an arc. Of course, it’s a mistake to promote people solely for sticking around. But they will be inclined to stick around longer if they see legitimate value in becoming a leader in your organization.


The question, then, is not how much can they contribute, but for how long can they continue to contribute at a certain level? Sustainable performance — in any regard, not just in terms of numbers — beats a fly-by-night success story every time.

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Erik Huberman
Erik Huberman, one of Forbes’ 30 Under 30, is founder and CEO of Hawke Media, a leading outsourced digital CMO agency named as one of the “Top 50 Startups in LA” and “Top 10 Happy Places to Work.”
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