Price’s Law – Why does this feel like it might be true?

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Price’s Law states that the square root of the number of people in a domain do 50% of the work. What this means is:

  • 10 employees: 3 of them do 1/2 the work
  • 100 employees: 10 of them do 1/2 the work
  • 10,000 employees: 100 of them do 1/2 the work

I’ve certainly worked in and been a leader of companies where the real engine rooms of a company were highly visible. I’m also sure that sometimes these people could go unnoticed and under-appreciated.

How would you summarise the challenges here:

  • How do you recognise the key people driving your business?
  • How do you retain the key people?
  • How do you ensure these key people are not resentful?
  • How do you spot the people underperforming?
  • How do you break Price’s Law? And increase the proportion of people doing the work?

I certainly think Performance Management will play a big part in solving some of these challenges, and this will include Goal Setting, 1-on-1’s, 360 reviews etc. as these systems will provide visibility on the performers and under performers.

The spotlight should not just been on non-managerial employees though. I think you’ve got to assume that a lack of engagement by some people is not due to their desire to not engage and work hard, it due to poor management of human talent.

Evaluating a manager’s ability to manage as well as a non-managerial reportees ability to perform is essential. Are your leaders any good at leading, motivating, mentoring, educating, and hopefully rarely, holding to account and policing? Or is the opposite true?


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