The HR ‘Fugazi’

“We need to reward not just the results, but also the way that results are achieved.”

“We need to reward not just the results, but also the way that results are achieved.”

“The ‘how’ is more important than the ‘what’.”

“I hire for attitude, because I can build the skill.”

“He gets results. But, I am not sure if he treats his people very well.”

All the above statements, and many more, punctuate the world of an HR professional and his/her consultant. These phrases often define the profession and dominate the conversation at HR conferences.

Talent vs. Effort: Performance vs. Potential: Skill vs. Attitude: Results vs. Culture: Goals vs. Competencies: What vs. How.

These dilemmas generate animated conversations whenever people are discussed in a business. The general conclusion at the end of each conversation is now beginning to sound like a cliche: “It is not an ‘or’ relationship. It is an ‘and’ relationship.” Talent and effort are important. Results and culture are important.

Of course; no question. But, that is missing the point. The point is that these are all fake dilemmas in the first place. There is no apparent or real contradiction that needs to be resolved. There is no ‘or’ and/or ‘and’ relationship between these choices.

In all these apparent choices, there is a primary factor and the other factor is inherent in the primary factor. Result is primary; effort is embedded in the act of getting a result. Talent is primary; effort is a constituent of talent. Performance is primary; the ‘how’ of performance is embedded in the act of performance.

For example, it is not possible to achieve sustained performance, or rather any performance, if you treat your team in a poor way. Any sports coach will tell you that. Therefore, the statement, “He gets results, but treats his people poorly,” often is a sad reflection of envy.

The superstar in this all-star cast of ‘made-up’ dilemmas is the one related to performance and potential. Many a nine-box grid has made its shiny way up on a projection screen, with names neatly slotted in each box much like ties in a tie-rack. Often, the individuals behind these names have no idea that, unknown to them, a group of discerning people have arbitrarily slotted them in a box called, for example, ‘solid citizens’ or ‘future leader’. Or some other box with an equally meaningless moniker.

There is no scientific or objective method to measure potential. It is not real. As Mathew McConaughey said in The Wolf of Wall Street, “It is not in the elemental chart.” “It is a fugazi.”

Any time a valid conclusion on potential is reached, it is inevitably based on performance. Tennis players who win junior championships have the potential to win senior tournaments. Tennis stars who frequently reach the quarter final of a grand slam have the potential to win a grand slam. Performance is the only predictor of potential. And, that is because performance and potential are one and the same thing. Performance is primary; potential is embedded in performance. You don’t need a X and a Y axis to separate the two. There is only one axis. That of performance. You just move up or down this axis.

The goal of a business is to provide a good or a service in a free market. It is rewarded with a profit because it provides this good or service. It is never rewarded for the effort or the intent to provide a good or service.

Outcome, performance and talent are primary: effort and attitude are necessary conditions.

As for potential: It is not a relevant concept.