High Output Management

by Andrew S. Grove

But no matter how well a team is put together, no matter how well it is directed, the team will perform only as well as the individuals on it. In other words, everything we’ve considered so far is useless unless the members of our team will continually try to offer the best they can do.

When a person is not doing his job, there can only be two reasons for it. The person either can’t do it or won’t do it; he is either not capable or not motivated. To determine which, we can employ a simple mental test: if the person’s life depended on doing the work, could he do it? If the answer is yes, that person is not motivated; if the answer is no, he is not capable.

The single most important task of a manager is to elicit peak performance from his subordinates.

How does a manager motivate his subordinates? For most of us, the word implies doing something to another person. But I don’t think that can happen, because motivation has to come from within somebody.

Simply put, if we are to create and maintain a high degree of motivation, we must keep some needs unsatisfied at all times.

A friend of mine was thrust into a premature “mid-life crisis” when, in recognition of the excellent work he had been doing, he was named a vice president of the corporation. Such a position had been a life-long goal. When he had suddenly attained it, he found himself looking for some other way to motivate himself.

Once someone’s source of motivation is self-actualization, his drive to perform has no limit.

Moreover, if we want to cultivate achievement-driven motivation, we need to create an environment that values and emphasizes output.

So it appears that at the upper level of the need hierarchy, when one is self-actualized, money in itself is no longer a source of motivation but rather a measure of achievement.

Thus, our role as managers is, first, to train the individuals (to move them along the horizontal axis shown in the illustration on this page), and, second, to bring them to the point where self-actualization motivates them, because once there, their motivation will be self-sustaining and limitless.

The role of the manager here is also clear: it is that of the coach. First, an ideal coach takes no personal credit for the success of his team, and because of that his players trust him. Second, he is tough on his team. By being critical, he tries to get the best performance his team members can provide. Third, a good coach was likely a good player himself at one time. And having played the game well, he also understands it well.

I’ll say again that a manager’s most important responsibility is to elicit top performance from his subordinates.

At Intel we frequently rotate middle managers from one group to another in order to broaden their experience.

Some researchers in this field argue that there is a fundamental variable that tells you what the best management style is in a particular situation. That variable is the task-relevant maturity (TRM) of the subordinates, which is a combination of the degree of their achievement orientation and readiness to take responsibility, as well as their education, training, and experience.

The conclusion is that varying management styles are needed as task-relevant maturity varies. Specifically, when the TRM is low, the most effective approach is one that offers very precise and detailed instructions, wherein the supervisor tells the subordinate what needs to be done, when, and how: in other words, a highly structured approach. As the TRM of the subordinate grows, the most effective style moves from the structured to one more given to communication, emotional support, and encouragement, in which the manager pays more attention to the subordinate as an individual than to the task at hand. As the TRM becomes even greater, the effective management style changes again. Here the manager’s involvement should be kept to a minimum, and should primarily consist of making sure that the objectives toward which the subordinate is working are mutually agreed upon.

It’s Not Easy to Be a Good Manager

Everyone must decide for himself what is professional and appropriate here. A test might be to imagine yourself delivering a tough performance review to your friend. Do you cringe at the thought? If so, don’t make friends at work. If your stomach remains unaffected, you are likely to be someone whose personal relationships will strengthen work relationships.

The point is, delivering a good performance review is really a unique act given both our cultural background and our professional training.

The biggest problem with most reviews is that we don’t usually define what it is we want from our subordinates, and, as noted earlier, if we don’t know what we want, we are surely not going to get it.

At all times you should force yourself to assess performance, not potential. By “potential” I mean form rather than substance.

There are three L’s to keep in mind when delivering a review: Level, listen, and leave yourself out.

The key is to recognize that your subordinate, like most people, has only a finite capacity to deal with facts, issues, and suggestions.

The purpose of the review is not to cleanse your system of all the truths you may have observed about your subordinate, but to improve his performance.

A poor performer has a strong tendency to ignore his problem.

Don’t confuse emotional comfort with operational need. To make things work, people do not need to side with you; you only need them to commit themselves to pursue a course of action that has been decided upon.

We must keep in mind, however, that no matter how stellar a person’s performance level is, there is always room for improvement.

Preparing and delivering a performance assessment is one of the hardest tasks you’ll have to perform as a manager.

We know how hard it is to assess the actual past performance of our own subordinates even though we spent much time working closely with them. Here we sit somebody down and try to find out in an hour how well he is likely to perform in an entirely new environment. If performance appraisal is difficult, interviewing is just about impossible.

The applicant should do 80 percent of the talking during the interview, and what he talks about should be your main concern.

When you ask a question, a garrulous or nervous person might go on and on with his answer long after you’ve lost interest. Most of us will sit and listen until the end out of courtesy. Instead, you should interrupt and stop him, because if you don’t, you are wasting your only asset—the interview time, in which you have to get as much information and insight as possible.

Asking a candidate to handle a hypothetical situation can also enlighten you.

The candidate can tell you a great deal about his capabilities, skills, and values by asking you questions. Ask the candidate what he would like to know about you, the company, or the job.

The opening shot usually occurs when you are on the run. On your way to what you consider an important meeting, your subordinate timidly stops you and mutters under his breath, “Do you have a minute?” He then mutters further that he has decided to leave the company. You look at him wide-eyed. Your initial reaction to his announcement is absolutely crucial. If you’re human, you’ll probably want to escape to your meeting, and you mumble something back about talking things over later. But in almost all such cases, the employee is quitting because he feels he is not important to you. If you do not deal with the situation right at the first mention, you’ll confirm his feelings and the outcome is inevitable.

Then your subordinate may say he’s accepted a job somewhere else and can’t back out. You have to make him quit again. You say he’s really made two commitments: first to a potential employer he only vaguely knows, and second to you, his present employer. And commitments he has made to the people he has been working with daily are far stronger than one made to a casual new acquaintance.

Money has significance at all levels of Maslow’s motivation hierarchy.

Why Training Is the Boss’s Job

At Intel we distinguish between two different training tasks. The first task is teaching new members of our organization the skills needed to perform their jobs. The second task is teaching new ideas, principles, or skills to the present members of our organization.

Please! You invested the price of this book plus perhaps eight hours of your time. At the risk of sounding like the author of a diet book, I would ask you to do something specific, and I leave you with a set of assignments.