Are People and Performance competing goals?

Spoiler alert: Leaders don’t have to choose between taking care of their people and delivering strong business performance.

Organizations often act as though investing in people comes at the expense of business performance, or that pursuing performance inevitably requires sacrificing the employee experience.

I don't believe either is true.

It’s people who build relationships with customers; people who create the products; people who find new sales channels. And, it’s people who make decisions, solve problems, innovate, collaborate, and lead operations.

Said simply, organizational performance happens because its people are the ones performing. 

People and performance aren't competing goals. They're reinforcing outcomes.  So instead of thinking of them as opposites to be chosen between, the better option is to intentionally design them so that people and performance reinforce one another and rise together.

Most organizations don't struggle because leaders don't care about people or because they don't care about performance. They struggle when they begin treating the two as competing priorities: 

• We don't have time to coach.
• We can't afford more flexibility.
• Development will have to wait until next quarter.
• Right now, we just need results.
• Let’s hold off on hiring and ask the team to do more. 

Taken individually, each of these decisions may seem rational but collectively and made repeatedly, they can create an organization in which people disengage and burnout, managers become overwhelmed, innovation slows, collaboration deteriorates, your best people leave. 

Organizational performance eventually suffers.

And that’s the irony: that decisions made in the name of performance gains can gradually erode the organization's ability to perform.

The reverse is true, too. Organizations shouldn’t invest in people because it’s the nice thing to do or the right thing to do. They should invest in people by creating environments where people can perform at their best because doing so builds organizational capacity and outcomes.

It’s not a tradeoff to treat people well, it’s a performance advantage.

The collective ability of an organization to consistently execute, adapt, innovate, and improve, its organizational capability, doesn't exist separately from people. In fact, it's created through people working inside intentionally designed organizations where they have the conditions to do better.

A talented employee can’t perform at their best, no matter their strengths and skills, if priorities are unclear, processes are cumbersome, leadership doesn’t lead, incentives are conflicting or don’t exist, or organizational structure is ineffective. And, the greatest organizational design won’t compensate for insufficient talent or cultural mis-matches.

You need both: Talented people with aligned cultural values functioning in an environment where they can apply their talents effectively.

When this happens, people are more likely to be engaged. When people are more engaged, they perform better. As people perform better, organizational capability grows. As capability grows, business performance improves.

The relationship isn't linear or competing, it's reinforcing.

Organizations often frame leadership as a series of tradeoffs: Engagement or productivity; culture or results; flexibility or accountability; people or profit.

I think those are false choices.

Being talent-centric doesn’t mean giving employees everything they want, avoiding difficult performance decisions, or squeezing productivity out from people.

Instead of thinking “people-first or performance-first?” think:  "How do we design this organization so people and performance naturally strengthen one another?"

This shift in thinking changes everything.

When profitability declines, instead of asking which people or teams aren't performing, examine whether goals are clear, decisions are happening quickly enough, leaders have the capability to lead, teams are structured effectively, and people have what they need to succeed.

When productivity stalls, instead of asking people to work harder, look for unnecessary complexity, competing priorities, poor processes, capability gaps, and work that has been badly designed.

When budgets tighten, instead of cutting development, recognition, or employee experience as discretionary expenses, ask which investments are actually building capabilities the organization needs, and only cut those that aren't creating enough value to continue.

Sometimes the answer means more investment into the employee experience. Sometimes it costs nothing. And sometimes, the most talent-centric decision is to simply get out of people’s way.

This is what changes when you apply a talent-centric lens. You’ll see people practices as a lever to achieving business results. And you won’t have to choose between people or profit because you’ll see you can honor human dignity while furthering organizational performance.

A conversation that I love to have with leaders (or teaching HR leaders facilitate), is to stop debating whether a challenge is a people issue or a business issue. 

Instead, I help leaders look beyond the immediate decision to understand what that decision will reinforce across the organization.

A performance issue, for example, isn't only about whether an individual should stay or go. We also need to consider what expectations were clear, how the manager has led, what behaviors the culture should reinforce, whether the organization's stated values are reflected in how the situation is handled, and what message the decision will send to everyone watching. That doesn't mean avoiding accountability to protect the employee experience. It means recognizing that how you hold people accountable is itself an organizational performance decision.

When results decline, when teams aren't collaborating, when growth creates strain, or when leaders aren't delivering, I look at where people are succeeding despite the organization, where the organization is enabling them to thrive, and where it may unintentionally be getting in their way.

The answers may lead us to leadership, structure, culture, talent, work design, decision-making, skills, systems, or individual accountability.

The goal isn’t to design the best talent and HR programs, the goal is to create conditions that allow people to perform. We do that by intentionally designing environments where people want to come to, want to stay in, and want to do their best work for.