A few years ago I was introduced to a staff-grading matrix which I found extremely useful – I’d like to share it with you today.

Most of the time, we think about our staff in terms of what they do – productivity, output, volume, and other tangible measures which lead up to the general idea of Performance: how well does someone do their job. Most measures I’ve seen of employees will focus on these tangible items because they are often easy to measure.

But it misses a big part of what makes staff valuable, doesn’t it? What about the receptionist whose unfailing kindness and warmth puts all visitors to the company into a positive frame of mind? Or the AP clerk who keeps bringing in the very best baking you’ve ever had? Or the developer who works nights on a passion project which enables you to showcase your technology in a new and exciting way? Clearly, these behaviours have value, and they impact your company often in powerful but hard-to-measure ways. An evaluation of a staff member has to take these important intangibles into account.

Many companies have enshrined a specific set of intangibles into a set of Core Values. These Values highlight the key aspects of the culture the company wants to create and nurture. Ideally, these values have as much impact on HR processes as do the Performance variables do.

And this is where the Performance-Value Matrix comes in. The Matrix was championed originally by Jack Welch of GE back in the 1990s. On the y-axis, you measure the staffer’s ability to meet their Performance objectives. On the x-axis, you measure how well the person adheres to the company’s values. What results is a quadrant with A, B and C labels based on where a person lands in the Matrix.

Those who score high on both Performance and adherence to Core Values fall into the “A Player” category. Note that the measures are absolute, not relative. Everyone can conceivably rank highly against their own Performance Goals and in alignment with values; indeed, you want everyone in the company to score in this area.

In this example, we can see 4 of the staff are in the “A” area. The goal with A players is to Retain; find ways to encourage these people to remain engaged with the organization (so long as they remain A players). Also, culture can mean a lot to an A player; keeping people who are aligned to your core values often means enforcing your core values (more on that, below).

Those who have high alignment to Values, but are performing below target for their jobs, are ranked as “B” players. The goal with B players is to Modify – either provide the necessary training and coaching to help them improve their Performance, or reduce their roles so that their skills are better matched to their tasks.

One interesting thing about B players is how many of them were A players at other times in their careers. In many cases, a person gets promoted beyond their capability and so, while painful, a demotion may be just the thing that a former A player needs to get back their mojo.

Not surprisingly, the bottom left quadrant, with low Performance and Low Alignment to Values, is where we find the “C” players. Unlike the B’s, coaching or training or movement isn’t enough here; these are people who don’t work with the rest of the company in a culture-friendly way. They often make poor teammates. These people have a low “fit-ness” with the company, and the best thing to do, for them and for your company, is to Let Them Go. The key here is figuring out if someone is a C player quickly, so that they do the minimum damage to the rest of the team and so that they can go somewhere else where they have a shot at being a highly-valuable A player.

So, what about that upper left quadrant? People who perform well, but don’t align to company values? This is the hardest area to work in, because those people are C players also.

A perfect example is the sales rep who hits his quota regularly due to, say, deep relationships in your target industry. He makes calls in the morning, plays golf in the afternoon. The younger sales staff, without that deep contact base, see this behaviour and figure they can have success the same way; work 50% of the time. The younger staff, however, need more discipline, and a culture of perseverance. The highly-connected rep, by his example, damages the less-experienced reps, and impedes their progress.

This is the hardest decision to make – keep the high performer and accept the hit to your culture, or let him go to preserve culture? Of course, there is a third option. Maybe your culture needs a change? Maybe you need more highly-connected reps and fewer junior reps? There is not a consistent answer here, except to say that you can’t continue to have C players and maintain your culture. C players, through their action and/or lack of fit, will always poison the culture of the organization. Most importantly, C players are anathema to A players. A company that retains C players will eventually lose its A players.

And we did say you want to retain your A players…