Top talent walks when low performance stays!

Fredrik Lindberg Co-Founder of BeeyondX, April 2025

Performance management models based on the classic bell curve from low to high performers have filled more management books than most of us care to count. We've all seen the familiar graphs; high performers on one end, clearly labeled as the assets to reward and retain. The middle majority quietly fades into the background, and the low performers? They're typically framed as a problem to fix or remove. The low performer outlier in the bell curve is a recognized problem obviously however the way the models and methods tend to be explained, the importance and impact of doing things right by this group is typically not emphasized.

The bell curve, by design, is a static snapshot. It shows how performance is distributed at a single point in time. And naturally, it draws our attention to what every company wants more of; high performers. But this lens is by no means enough as it is too simplistic in its logic to display the mechanics at work behind the distribution of performance. It suggests, correctly so, that high performance is where the value lies, while low performance is reduced something to minimize or tolerate. However, it provides little understanding on the importance of addressing the low performers and what the potential impact could be and also why the there is a stronger leverage in this group. 

Addressing both ends of the bell curve means addressing and improving the pre-requisite for high performance from two different perspectives; voiding the massive negative impact due to inaction (low performance) and improving, strengthening and building on the high performer. With regards to immediate impact to the organization, one has higher immediate leverage than the other. Addressing low performers impacts in a dualistic manner where both the low performers and the high performers are simultaneously impacted.

The traditional answer is to double down on the top of the curve. Reward, stretch, promote, retain. And surely, managing high performers is very important. It’s also complex and long-term. It requires individualized attention, often layered incentive models and clear path for professional growth. It’s well-documented and extensively debated in management literature.

But what about the low-performance end? It’s often dismissed as static, a fixed population, a drain and a discomfort. In my experience is something to quietly handle or quietly ignore. And yet this is where the untapped power lies.

The standard bell curve simplifies a messy reality; performance is not just about individual output it’s about culture, credibility, and clarity in expectations (for all). And the lower end of the curve holds significant influence over all three. So why is that?

Tolerating and keeping underperformers in critical jobs will obviously reduce output from those jobs, functions or organizations, this is mostly as expected. What might be less obvious is the dynamics of inconsistent treatment and what impact inaction will have on the organization as a whole, across the performance spectra. Not attending to low performance will for instance:

1. Cause fewer high potentials to be attracted to join

2. It will block career advancement opportunities to the deserving

3. It will inhibit the development of subordinates

4. Productivity and morale are likely to spiral downwards

   
   

Consequently, according to Peter T Chingos (2002), from the four indirect impacts on the top performance spectrum, high performers are also leaving the company.

In conclusion what you tolerate defines the culture and high performers are watching. Managing the top and low end of the bell curve requires different management muscles. Managing the top end will pose challenges and create complexity working with development, recognition and growth. Whilst working with the low end requires something that rather can be summarized as decisive action and clear signaling as the cost of doing nothing is too high.

When dealing with the low end of the performance spectra there are aspects of the nature of the groupings that makes passive tolerance even more risky. Here it would be worthwhile mentioning the Dunning Krueger Effect (1999). There tends to be a cognitive bias in the low end of the performance spectrum where competence is overestimated and conversely, the high end of the performance spectrum tends to struggle with an underestimation of competence.

Addressing performance in a relevant way according to the bell curve might look easy enough but the employees in the outlier groups might have a very different view on the simplified lens we are observing. As the low performers are blissfully unaware of a problem confidently enjoy the vista from the peak of mount stupid, the high performers that are quietly doubting themselves on their journey through the slope of enlightenment but at the same time wondering why management tolerate obvious dysfunction. To conclude, start by addressing your low performers. Addressing low performance is not punishment. It’s protection of your culture, your standards and your best people.

You can’t tackle high performance without touching low performance, they are two sides of the same coin!

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At BeeyondX, we bring powerhouse HR expertise backed by senior management and consulting experience across 20+ companies. We don’t just know HR—we live it. From strategy to execution, we’ve got the full spectrum covered, with deep specialization in what matters most: performance management.

www.beeyondx.com

Value creation

A lot has been written and said about Europe facing a need of more growth, innovation and less red tape and regulations. The same is true about the businesses we work in and about ourselves. We basically need to increase our value output. Outsourcing, offshoring, partnerships, upskilling and reskilling – tons of things have been done and continues to be invested in. At BeeyondX we have been in several discussions with different businesses about means and ways to create a higher degree of value creation in organizations and teams.   

Let us share our thoughts, if interested we would love to hear from you.

Gary Hamel back in his book The Future of Management (2007) talks about the pyramid of value creation. The hygiene elements (performing tasks assigned with diligence and competence) only take you so far. To create higher value, taking initiative, being creative and possessing a strong will to get things done is also needed, and how you differentiate yourself. Employees that show the later characteristics tend to be high performing and adding a much higher value to businesses. It can for example be the salesperson doing a great job in assessing the true needs of the customers and being able to translate them into actions, to a receptionist “owning” the customer experience of visitors to the place of his or her work. There are no problems finding examples of what differentiates someone “doing the job” to someone “outperforming the role expectations”.

Those best equipped to define how real value creation looks tend to be those responsible for the job to be done. We really appreciate the research of Zeynep Ton and her approach to what she refers to as the “Good Job Strategy”. Invite those doing the job to define how to evolve it. What can be cut out, added and adjusted.

So, what we are doing is with clients exploring how to increase expectations of functions and roles in their organizations. It is about challenging the actual role requirements, incentive structures and expectations of each other. But it is also with the teams involved that they define what can be standardized, automated and taken out.

There will not come a Eureka moment when someone finds The Recipe for how to build the next generation value creating organizations. But by leaning on relevant experience and research we can experiment and evolve how we run our businesses and do our part in creating a more competitive company.

EU Transparency Directive

As most are aware, the Swedish and, for that matter, the European labor market is facing a major shift regarding compensation and transparency through the now-adopted Transparency Directive. The directive will introduce a formal reporting requirement on pay gaps starting in 2027 for larger companies, based on payroll data from 2026.

The legislation will impact large cap corporations earlier and in a more comprehensive way. On the other hand, these companies often have the structures and resources in place to meet the new requirements.

We perceive that implementing the directive's requirements will be more challenging for small and medium-sized enterprises (SMEs). Smaller companies are often more agile but may not have the necessary expertise, structures, or methodologies that larger organizations have developed. Although the legislation will affect the reporting requirements for the SME sector later on, there is a risk that market practices and expectations from the talent market will force faster action here as well.

In the attached video, Fredrik Lindberg explains what the legislation entails and its implications. If you have any questions or wish to schedule a meeting with Fredrik, please contact him directly at Fredrik@beeyondx.com.