Rather than focusing on your best employees, improve your worst ones

Toxic Workers and High Performers

There’s a lot of research in workforce management / HR / organizational health / organizational development circles around high-performing employees, and there’s almost no research around bad / toxic employees. This is probably fairly logical: we don’t often discuss failure at work, so why would we dedicate a lot of research effort to failing employees?

Northwestern University just did some research on “toxic” employees, and here’s a part that should make you rethink a lot of how we approach hiring, firing, retention, and development:

The results were startling. A top 1 percent superstar—a very rare high performer—brings an extra $5,300 in value by doing more work than an average employee does. Replacing a toxic worker with an average one creates an estimated $12,800 in cost savings over the same period by reducing the cost of turnover around that toxic worker. Similarly, replacing a toxic worker yielded almost four times the value of hiring a top 10 percent performer.

You can read that in a few different ways, but essentially, replacing a “toxic” or bad worker with an average worker is almost 2x as valuable as having a top 1 percent superstar.

Here’s how I’d personally read that: top 1-percent superstars are extremely rare, right? By definition, there’s not a ton of them in the world. (Think about in terms of “the 1 percent” when we talk about rich people.) Most companies probably don’t have a top-1 percent superstar for their industry (obviously by the nature of how percentages work, every company has a top 1-percent of employees).

This is what I’d take from it:

  • First, have some type of metrics around what distinguishes good and bad employees. Simply “being an asshole” doesn’t make you a bad employee, relative to industry. There is a whole concept of “the brilliant jerk.”
  • Second, figure out a development plan for the bad employees. This is fraught because the common way that most organizations deal with “bad employees” is to keep ’em at the same salary and assign ’em to no-ROI deliverables, but if you look at this stat above, you’d probably be better off having an actual plan to turn “bad” into “average.” Usually that’s not even that hard — it’s a mix of attitude shift, re-commitment to purpose, or shift in roles. A lot of times people come into an org in one role and suck, but then are really good at a different role. It happens a lot more than you think.
  • Third, less focus on “the top dogs” or “the top performers” and more focus on bringing everyone up to a good, base level. This is also a little bit fraught because senior leaders are usually closest to the money stats, so they know who in the company is working on stuff that brings in money, and they tend to focus on those people more. Thing is, those people probably ain’t going anywhere. If you bring in money at a place and you get the perks / minting, you’re usually comfortable to stay. (Not always, but usually.) But if you try to bring the bottom up to the middle, that seems like it has some good financial value.
  • The overall flow is something like this: What do people in your organization do? — > How do you know if they’re good or bad at what they’re doing / what are you measuring or tracking about them? — > How can you make the “bad” ones better / what skills would they need to perform better? — > What do you do with them if it doesn’t work?

This is the whole area where work kind of collapses for me. We spend so much time on process here, there, and everywhere — but when we get down to bigger decisions around people or development or even anything that’s not revenue-tied, we almost never stop and think. If we just did that for 5-10 minutes here and there between rushing from e-mail to meeting and back again, we’d be better off.


Ted Bauer


  1. I agree wholeheartedly, but there are problems with this approach.

    For one, every company out there thinks they deserve the best of the best, no questions asked. Whether their products, jobs, salaries, and other forms of comp are the best of the best is irrelevant in their eyes. Willing blindness and decades of SALE! oriented recruiters have the worst employers thinking they are entitled to the best people, regardless of how much they pay or how they treat people. And, oddly enough, the worse the employer the more likely they are to demand the best, usually on the assumption that all the problems caused by their own horrendous management will be solved if they can just hire ‘the right kinds of people.’

    Second, the assumption is the worse the employee, the more time they need to be managed. This isn’t necessarily the case, but in a world where near zero training or thought or preparation is given to managers, it’s assumed to be easier to hire top performers so you don’t have to manage them as much. That they might demand more management resources in order to keep the directed and advanced properly doesn’t occur to most people, however it’s usually the case that a top performer knows what their manager should be doing for them, and demands it more than an average or below average employee.

    Third, this strategy may just be the law of averages playing out. Most companies are average, as such it’s just easier for them to retain and work with average employees, and you may see different results at top tier companies, where if they have the resources to retain top people, see results from them more than average employees.

    Which leads to my approach, which is basically taking an honest look at what you as an employer offer people, grade that relative to the market, and then hire for who you can likely get and retain. But almost no company on the Earth is willing to do that. Jack’s Private Label Toilet Paper Manufacturing Company with 80% turnove and no benefits and no paid time off honestly thinks there’s no reason why someone wouldn’t want to leave Google to work for them. The attitude, in the US at least, is so skewed toward the employer over the employee that Jack’s literally thinks it’s doing people a favor by bestowing upon them the privilege of working for Jack’s, and under no circumstances will they ever consider employment from the perspective of a mutual agreement between mutually important parties.

    As a recruiter I’ve seen this attitude take hold and distort the hiring process at almost every company. An offer was turned down? The whole company goes on hold while they figure out ‘what went wrong,’ and the fact that the candidate told them he was making 100K, and was looking for 120K, and that they offered him 90K, is not even considered as a possible cause. And I’ve seen all the SALES! oriented recruiters I work with do anything and everything to satisfy the employer, the almighty client, and flip out when the candidate even attempts to assert themselves on any level, especially when it comes to demanding what they’re worth. Most employers these are so delusional that they honestly don’t understand these issues. And they will not invest in their employees to improve them because they honestly think the best of the best of the best are lining up to work for them, and at whatever price they see fit to name. If someone is really so delusional that they honestly think they deserve a new BMW every month, you’re not going to have much luck convincing them to maintain and repair their Honda.

    • Midieval Recruiter, you are so right! I first saw this attitude about 25 years ago, which has since become very pervasive. I haven’t had a company sell themselves to me, whether in an interview or offer, for at least 20 years. Guess they figured they were just so awesome, or applicants so desperate, no need to bother.

      It kills me that companies think they deserve A players for B or C salaries, then complain about a talent shortage. The obvious solution, done long ago, is to develop employees, instead of expecting perfection from day one. Moneyball shows great teams can be built with normal folks, rather than obsessing over superstars. Why aren’t companies copying this?

      This infatuation with perfection has so screwed up hiring. As amply reflected in dreary job descriptions, with their unending bullet list demands and responsibilities, without providing a clue as to what the job actually entails, or why anyone would be motivated to apply. Unfortunately, polls show 2/3rds of managers think they have the luxury of waiting indefinitely for the purple squirrel, so don’t expect improvement soon.

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