The CPA profession is admittedly a competitive one. We probably aren’t as cut-throat as the legal profession, but then again, we don’t have to do a lot of litigation so we aren’t trained to be as aggressive. So pseudo-friendly “coopetition” (cooperation and competition intertwined) is a bit of the norm as young accountants join the profession and work their way up in public accounting and later in business & industry.
I know when I was coming up in the ranks at PwC, the key time was always annual evaluations and coaching. That was when we found out who got promoted, what raises/bonuses we got, and basically got feedback on what we needed to do better and what we were doing well. And there was definitely the back room conversations of “oh my god, how did he get promoted?” or more positively: “she’s lucky she got that assignment, it sealed in the promotion for her and let her show her potential.
While reading the article, “Why Mediocre People Keep Getting Promoted“, it really made me think…yea, why do mediocre people sometimes get promoted over others? Well according to the article there are several reasons:
- A mediocre person, who has “experience” in an area, will often get chosen over someone who doesn’t because while the less experienced person may have more potential, they are also a greater risk because they don’t have as much experience.
- There are scant opportunities to demonstrate talent, especially the higher one goes in an organization. So the mediocre person who performs ok at a job, but gets noticed, will have an advantage again over some with more potential, but doesn’t have the name recognition.
The article goes on to talk about how based on the second bullet, people can start to “fail up”–in other words continue to advance based on average performance, but strong name recognition. Of course, they can’t be a total failure, their first (or first several) promotions are based on some initial successes and good performance. However, the question is whether they’ve actually demonstrated additional successes as they’ve continued up the ladder.
So this made me ask the question: are we as CPAs, providing enough opportunities to our staff to allow emerging talent to show itself, or are we simply taking our average (but consistent) performers and ‘failing them upward”. I could make the analogy to an investment strategy. Do I have all of my investment in cash and cash equivalents (low risk, but also low return)? Or am I putting some of it in higher risk, and potentially higher return, vehicles? As with the diversified investment portfolio approach, a successful organization will invest in a diversified set of opportunities with its talent pool.
On the other hand, the “failing up” concept also reminded me of the Peter Principle and how we as managers sometimes want to think the best of someone and keep promoting them upward until we take them to the point of their incompetence. The point here being that we sometimes also have to be careful of providing too much opportunity, and we have to ensure that the opportunity is the right fit for the person.
The bottom line? We need to ensure that we are providing enough opportunities to our staff to undercover their talents and allow us to find their strengths. However, we also need to ensure that we are making sure that we are providing them with the “right” opportunities and pushing them to the point of incompetence. A balanced approach of opportunity, risk, and leadership (on the part of veteran CPAs), will help to maximize the potential of the portfolio of upcoming CPAs.