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JWI 521 – Week 2 Lecture Notes (1192) Page 1 of 5
JWI 521
Recruit, Develop, Assess, Reward, Retain
Week Two Lecture Notes
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JWI 521 – Week 2 Lecture Notes (1192) Page 2 of 5
IDENTIFYING YOUR STRATEGIC POSITIONS
What it Means
Successful companies have well-developed systems for managing and retaining their high-
performance and high-potential employees. These are the people that Jack calls the “A Players.” A
winning workforce is made up of great individuals, so it makes sense for your company to devote
time and energy to identifying, developing, and retaining its stars. Your “A Players” only belong in
high-impact jobs; it is just too expensive to attract, select, develop, and retain top performers for
every last position in the company. This lecture will help you identify the jobs – no matter what part
of the organization you manage – that are crucial to the success of your strategy.
Why it Matters
• Your top performers must be engaged in work that is essential to the company’s
strategy
• Strategic positions vary by company – they must reflect the company’s strategic
capabilities
• Knowing which positions are essential to your strategy will improve workforce
management
“Building a great team is your job. You’re only as good
as the people you hire.”
Jack Welch
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WHAT IS A STRATEGIC POSITION?
Let’s divide the work of an organization into three categories:
1. Strategic work has a profound impact upon the creation of customer and economic value.
2. Support work includes a wide range of functions that enable and support the strategic work.
3. Surplus work may have created value in the past, but no longer contributes much value to the
business. It is work that remains in a company for reasons of tradition, politics, or inertia.
There are no inherently strategic positions – whether or not a job is strategic depends upon a company’s
goals. For instance, in a consumer products business, the director of marketing may make the difference
between success and failure. They obviously hold a strategic position. In another company, marketing may
be relatively unimportant; the head of research may be the person who most strongly influences the
company’s fate. Relatively few positions in any given company involve truly strategic work.
Unfortunately, many leaders don’t know how to identify the strategic positions for their organization. They
assign strategic importance to the jobs held by the most highly skilled, hardest working employees, or those
exercising the most responsibility. Alternatively, they may think that, if people are highly paid, their
position must be strategic. Why else would they be earning so much?
Of course, sometimes compensation is linked to strategic work, but not always. In most retail outlets, for
instance, cashiers are paid minimum wage and do not need any special credentials to be hired. But if you
are managing a store whose competitive advantage is a positive buying experience, including getting
through the checkout line quickly, your cashiers are key strategic players. Or take the example of Wall
Street. For many years, it paid its bankers like kings – after all, they were doing all the important work. The
financial crisis made it clear, however, that some of the most strategic positions on Wall Street were in the
compliance and risk management functions. And so now, in many financial businesses, compliance
professionals are considered to be key strategic players and are paid accordingly.
STRATEGIC CAPABILITIES DEFINE STRATEGIC POSITIONS
In order to identify the strategic positions in your own organization, you must first identify your organization’s
strategic capabilities. What activities can your company perform in a way that your competitors cannot?
What makes customers want to choose your product or service over others?
As a shortcut, consider this. You know an activity is strategic if it:
• Positively affects your customers’ perception of value
• Allows you to make or deliver your product or service at the desired cost
• Enables you to charge your desired price, be it high or low
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JWI 521 – Week 2 Lecture Notes (1192) Page 4 of 5
Most organizations and business units have no more than four or five strategic capabilities. Walmart, for
example, has strategic capabilities in IT Analytics, which tracks customer purchasing patterns in great detail,
and in its ability to purchase products in bulk, which pushes down costs. By contrast, the strategic
capabilities at Neiman Marcus revolve around stylish products and well-designed interiors, both of which
drive the company’s strategy of providing a high-end, glamorous shopping experience.
Let’s look at a real-world example of two companies to see how their strategic capabilities relate to their
strategic positions. Two well-known retailers who differ widely in their missions and target markets are
Nordstrom and Costco. Both rely on customer satisfaction to produce growth and shareholder value, but
they rely on very different types of capability to generate that satisfaction. Nordstrom satisfies customers with
its ability to provide personalized service and advice; Costco satisfies customers with its ability to offer a
wide range of products at rock-bottom prices. Since the strategic capabilities are different, strategic roles at
these companies are also different. Front-line sales associates are vital at Nordstrom, but Costco places
much more value on purchasing managers, a role that is central to the company’s success.
MANAGING YOUR A, B, AND C PLAYERS
Determining which positions are essential to your strategy can increase efficiency in managing your
workforce. You will minimize time spent on jobs with little direct impact upon your company’s success.
Instead, you will invest significant time and effort into performance improvements in strategically important
positions. Take the store cashier we discussed earlier. If your strategic advantage lies with the customer
experience, do not just hire someone who can scan products correctly and collect money with a friendly
smile. You need a person who notices what customers buy and suggests other products. You want a person
who likes to move quickly and understands that the customers waiting in line want quick service, too.
Put simply, it is critical to fill your A jobs with A players and to pay them appropriately. Top-performing people
in strategic roles should earn better-than-market rates. Your organization must continually evaluate and
improve its programs to recruit the best people for your strategic positions. To fill these key positions, your
company must create effective job descriptions, find strong candidates, conduct insightful interviews, and
make good hiring decisions. It is the responsibility of HR to support managers in this important process.
Although it makes sense to disproportionately invest in your top performers doing strategic work, that does
not mean you should ignore employees in other positions. Competent support staff members are essential,
and poor performance in such jobs can be costly. For example, baggage handlers are not central to an
airline’s strategy, but one lost bag can turn a customer into a walking advertisement for the competition.
Think of it this way: although competent actions by employees in support jobs will not generally cause you to
win, incompetent actions by such individuals can certainly cause you to lose.
How about surplus work, those outdated jobs that were never removed or updated? Overcoming tradition,
politics, or inertia can be hard. But you may conclude after careful analysis that, just as you need to weed
out your C players over time, you may need to weed out some of your C positions over time, as well. The
marketplace is too competitive for a company to pay for work that adds no value.
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copied, further distributed, or otherwise disclosed, in whole or in part, without the expressed written permission of Strayer University.
JWI 521 – Week 2 Lecture Notes (1192) Page 5 of 5
GETTING THE MOST OUT OF THIS WEEK’S CLASS
As you read the materials and participate in class activities, stay focused on the key learning outcomes for
the week:
• Understand the difference between strategic positions and support positions
Think about what this means for you and your team in your current company. Does your HR team
have a clear grasp of the difference between these two types of positions? Does the organization
apply sufficient resources to hiring, training, and managing “A players”? Are top performers placed in
appropriate positions, where they can have an influence on strategy and add value for the
company? Are the support functions staffed with competent employees? Are there good systems in
place to catch incompetent performers before they do too much harm to the bottom line? If not, what
can the HR team do to drive change and address the issues?
• Analyze a company’s strategic capabilities to identify its strategic positions
Does your HR team understand the strategic capabilities that make your company competitive in its
sector and market? Do they know how to use an understanding of those capabilities to identify the
key strategic positions in your company? Do the leadership and management in your organization
simply assume that the people with the most challenging roles or those with the highest pay must
surely have the most strategic jobs? If this is the case, how can HR help to deepen their
understanding as to which positions are the most strategic in your company?
• Explore and discuss how to make great hires for your organization
Take a look at your own organization’s hiring practices with a critical eye. What do they do well?
What could be improved? How effective are the processes used to create job descriptions, source
and identify candidates, screen and interview people, check references, and make hiring decisions?
If there are areas that could be improved – and there always are – what can HR do to add tools,
train staff who participate in making hires, and improve the quality and potential of new people
brought into the organization?
