"A great lathe operator commands several times the wage of an average lathe operator, but a great writer of software code is worth 10,000 times the price of an average software writer" - Bill Gates
We have always thought of talent distribution as a “normal distribution”, but we are wrong. It is a Power Curve for sure.
Talent is not a normal distribution
Ask a group of people if they would rate themselves in the top 10% of the profession or a skill (like driving or managing people) and you will see most hands go up. The reality is that talent is not uniformly distributed. It is only by comparing performance with others doing the same work can we identify how much better one person is at the job.
While it is common to think that talent is distributed as a normal distribution, the top 1% of any field are significantly better performers consistently over time. Talent is distributed by a power curve – where a few people dominate for years. Whether it is in sports or music or business, top talent is head and shoulders above even other high performers. Roger Federer, now aged 39, has won 20 Grand Slam titles stands miles ahead of any other tennis player. JK Rowling is miles ahead of any other writer.
Pandit Ravi Shankar would have been 101 today. Born on 7th April 1920, he changed the way the world understood Indian Classical Music. He became synonymous with the sitar. There have been many sitar players, but there will be only one Pandit Ravi Shankar.
"Talent hits a target no one else can hit; genius hits a target no one else can see."
- Arthur Schopenhauer
How much better are they?
The top 1% gets 10% of the organisation’s output. The top 5% accounts for 25% of the output. As per the 80-20 rule, 80% of the firm’s output comes from 20% of the people.
Michael Phelps Olympics medals tally consists of 23 gold medals (from 2004 to 2016) – the most Olympic gold medals ever won - three silver and two bronze medals. The haul of 28 medals makes it the most ever in Olympic history.
Marie Curie got the Nobel twice. She shared the Nobel for Physics with her husband Pierre in 1903. Pierre passed away in 1906. Marie Curie won the Nobel Prize again in 1911. This time it was for Chemistry. In 1935, their daughter Irene-Joliot Curie also won the Nobel in Chemistry with hubby Frédéric Joliot.
I went to the Nobel Museum in Stockholm. And I stayed over long after all visitors had left. I even had dinner there… serious! <Read about it>
Complex jobs demand exceptional talent
In a knowledge economy, as the job complexity increases, the impact of top talent is even more visible. In low complexity jobs, the top performers produce 50% more than the others. In high complexity jobs their performance is twice as good as the others.
1. They impact the organisation’s performance
2. They are a force multiplier for a team
Michael Jordan was the Most Valuable Player 5 times in 1988, 1991, 1992, 1996 and in 1998. During his tenure, his team Chicago Bulls won the championships six out of the eight years. Without Michael Jordan, the same team became the “worst performing”. Just watch him perform these incredible plays.
Talent management impacts business
Talent management is a way of making business impact through people processes. Being a powerful employer brand that attracts the top talent to onboarding and engaging them to give their best, and then developing them to take on bigger challenges. It needs talent management tools and metrics.
The organisations that are talent magnets build their reputation around strong talent management practices and choices. Many organisations spend days together identifying the high potential talent but never share it with the talent pool. Traditional wisdom says that if you tell someone they are part of the top talent group, they will be approached by head hunters. Announcing this will make the others feel demotivated.
How to treat the ‘top talent’
The performance of the top talent is always visibly better than the rest. When Michael Jordan was awarded Most Valuable Player (MVP), it did not come as a surprise to anyone. So the award only confirmed what everyone knew.
If your talent management process is fair and accurate, the results will confirm what everyone knows already. Tell them that the ranking is not a tattoo. It will have to be earned every year. Offer the top talent challenging assignments and projects.
As Marc Effron says in his book One Page Talent Management, leverage the science, avoid complexity and be transparent summarises the three design principles of sound talent management. In a knowledge economy talent is what turns an average organisation into a fast growing business.