Knowing where to optimize your talent

Over the weekend I caught this pretty interesting discussion on the Marginal Revolution site, 'Where is talent opimized?', a discussion of what industries (or more accurately job roles), have the ideal or 'best' talent suited for their roles actually doing those roles.

It makes more sense to think about this idea of talent optimization, a state where the very best people who could perform a job are actually in that job by looking at a couple of examples where the difference is pretty clear. For example, professional basketball players, who are subject to years or training, competition, evaluation, and measurable performance metrics are probably the 'optimal' group of folks to actually be playing pro basketball. Said differently, it isn't likely there is a large untapped, undiscovered group of people who really should be playing pro basketball, but for some reason (or some labor market inefficiency), they are doing some other job instead.

Compare that to a job like mid-level management or perhaps many governmental jobs. In many of these roles performance is harder to quantify and measure, compensation levels are either opaque or set on criteria other than performance, barriers to entry to the profession exist, (lots of 'referral' hiring for example), and finally many of these jobs have been closed off to under represented groups for a long time. When you think about it, it seems really unlikely that talent in these kinds of roles, in any organization, will be the 'best' or 'optimal'. It is just too hard to even figure out what 'optimal' even means I would argue. Finally, roles that once you 'get in' it is almost impossible to get removed from for poor performance or incompetence should also be added to this group of sub-optimized talent profiles.

Why is this interesting (at least to me?)

Because I think often while we know that some roles in the organization are more important/strategic to the organization than other roles, we don't always acknowledge that there also exists this difference in the ability to 'optimize' talent across different roles as well. Although the distinction may be subtle, these two are not actually the same thing.

Finally, understanding how (or I suppose if), an organization can exploit these kinds of selection/sorting inefficiencies and get 'better' or more optimal talent attracted to roles that typically are less likely to be optimized, could result in a competitive advantage through talent that is usually unrealized.

In other words, if your organization could truly have the 'best' front-line managers wouldn't that make a huge difference in business and talent outcomes?

I will leave you with this one link to think about this more - In-N-Out Managers make $160,000 annually.

Have a great week!