In the movie "A World Without Thieves," Ge You famously said, "What is the most important thing in the 21st century? Talent!" Even a thief knows the importance of talent to a company. However, many people leave their jobs because companies don't know how to maximize the value of their talent.

From long-term management practice, we have summarized three principles for using talent: lean staffing, preferential treatment, and the 80/20 rule.

Lean Staffing

Lean staffing means compressing headcount as much as possible, dynamically compressing it, and always keeping it in a state of hunger where there are never enough people. If five people can do the job, never use six; if 30 people can do it, never use 31. We want two people to do the work of three and get paid for three.

In most cases, a company's success is inversely proportional to its headcount. It's not that more people mean greater strength or higher probability of success. On the contrary, too many people can become an obstacle on the road to success. Good companies have lean teams that are always busy. In any company, the departments with outstanding performance are never those with redundant staff.

This applies to individuals as well: the busier a person is, the more tasks you can assign to them, and they will never let you down; the more idle a person is, the less you dare to entrust them with anything...

Although companies can die in many ways, the common denominator of all these deaths is bloated staff and no overtime.

Many companies follow this logic: too much work, so they add operational staff and management; more work, so they add more operational staff and management... This cycle repeats, and the company grows in headcount and management layers...

But do we really have that much to do? Do we really need that many people? The answer is, of course, no. According to Lakala's four-step methodology, when doing things, you should "first ask the purpose." Before deciding whether to do something and how to do it, first clarify the purpose. From my years of experience, if we first clarify the purpose, at least half of what we are currently doing can be cut out! Imagine if we stopped doing half of what we're doing, couldn't we do the rest faster and better? Would we still need so many people?

So, lean staffing is the first principle of talent management, and we firmly oppose overstaffing and bloated organizations. Only by keeping the headcount in a state of hunger where there are never enough people can we ignite passion and drive, force ourselves to cut out unnecessary tasks, and push everyone to improve efficiency, resulting in better and higher performance. This has proven effective in many companies.

Many managers have had this experience: a task that would normally take a month is completed in three days because of urgency, and the results seem fine...

Recently, I saw a cultural review from one of our employees. It described how, after work, while watching a movie with colleagues, they received a call about an opportunity to apply for a project, but the deadline was noon the next day—less than 16 hours to prepare 14 materials, one of which required a third-party report. Previously, the shortest preparation time for such a project was half a month, and the longest was half a year. They decided to go for it, mobilized various departments and third parties, worked through the night, and finally submitted the application ten minutes before the deadline...

My first reaction was to cheer for them. My second thought was that human potential is truly limitless; our abilities far exceed our imagination. My third thought was: if we can do in 16 hours what we thought needed half a month or more, how powerful would our company be? It shows how much potential we have and how inefficient we usually are...

Recently, a subsidiary of BlueFocus had a new manager who cut 40% of the staff and some projects, resulting in a significant increase in company profits...

These vivid examples remind us managers that the first rule of human resources policy should be to streamline staffing and simplify administration.

Preferential Treatment

The second principle is preferential treatment. For those we have already hired, we should make their compensation exceed the industry level. On one hand, we want them to be satisfied with their pay and not want to leave. In fact, the loss caused by employee turnover is enormous, though some of it is hidden and not visible.

If you analyze it carefully, when an employee leaves, finding a replacement takes time and headhunting fees, and the replacement needs time to get up to speed. Not to mention the information lost during the handover, the threads that are dropped, and the work that has to be redone because of the change in responsibility... If you calculate the cost, it's a huge number. If you proactively take a small portion of that cost and add it to the current employee's salary, making their compensation exceed the industry level, people will naturally stay.

Of course, retaining people isn't just about pay; corporate culture also matters. But in this material world, pay is very important and fundamental. It's a company's natural duty to let employees live with dignity and improve their material lives. On the other hand, from a fairness perspective, our results are created by key core employees, so it's only fair and just to let them share in the fruits of success. Therefore, companies should hire fewer people, but treat those they do hire well, giving them above-industry compensation.

The 80/20 Rule

The third principle is the 80/20 rule. Pay 80% of compensation to 20% of the people, because 80% of the results are created by 20% of the people. So we must pay 80% of the compensation to 20% of the people. The biggest taboo in compensation is egalitarianism. Not only is it unfair, but it also has a very negative effect. First, it hurts the motivation of the top performers. They feel that they put in more effort and achieved more results, yet they earn about the same as those who didn't. This greatly dampens their enthusiasm. When these people lose motivation, it's like losing the motivation of 80% of the organization, which is fatal.

Putin said that although Russia's territory is vast, not an inch of it is superfluous. To paraphrase: although a company may be strong, not a penny should be spent on idle people. In terms of talent management, we must reward and punish clearly, paying 80% of the money to 20% of the people. Although the income gap may be large, it's necessary. Only then can we do well as a company, and only when the company does well can we afford to treat our employees well and give back to society.

Managers must remember: egalitarianism is favoring the laggards; favoring the laggards is unfair to the top performers; being unfair to the top performers is irresponsible to everyone.

Source: Sun Taoran (ID: strlkl) -END-