Topgrading: How Leading Companies Win by Hiring, Coaching, and Keeping the Best People, Revised and Updated Edition
Bradford D. Smart
Portfolio/Penguin Group (2005)

Note: I read this book when it was first published and recently re-read it. If anything, it is more valuable now than it was then.

Smart formulated what he calls the Chronological In-Depth Structured (CIDS) interview approach. After studying 4,000 managers in relation to (on average) ten different jobs per manager, he arrived at a number of conclusions. They serve as the core material of this book in which he explains how both companies and individuals can gain and then hold a competitive advantage which Peter Drucker identifies as follows: “The ability to make good decisions regarding people represents one of the last reliable sources of competitive advantage, since very few organizations are very good at it.” As Smart carefully explains, topgrading is the practice of packing any team with A players and clearing out the C players. “A player is defined as the top 10 percent of talent available at all salary levels — best of class. With this radical definition, you are not a topgrader until your team consists of all A players. Period.”

Those who read this book and then apply the principles, strategies, and tactics which Smart recommends will be well-prepared to (a) hire only A players or those almost certain to become one and (b) those who are or wish to become A players and need expert guidance to achieve that objective.

For me, the most stunning revelations in the book are found on page 50, in Figure 3.2, “Cost of Miss-Hire Study Results.” According to the results of Smart’s research study of more than 50 corporations, the sum of costs of a mis-hire (on average) are as follows:

Base salary Less than $100,000: 14 times salary
Base Salary $100,000-250,000: 28 times salary
All Salaries: 24 times salary

Now go back and re-read those statistics while keeping in mind that, for various reasons that Smart briefly explains, “the numbers are probably conservative.” Even if, in fact, Smart is wrong and you cut the multiples in half, the total costs are still substantial…and genuine cause for concern and especially, for caution.

Organizing his material within two Parts (one for companies, another for individuals), Smart offers a cohesive and comprehensive narrative within which he includes all manner of graphic illustrations as well as a number of exercises and questionnaires which enable both those who hire and those who are candidates to understand what topgrading is, what the CIDS interview approach is and how to derive the greatest benefits from it.Organizing his material within two Parts (one for companies, another for individuals), Smart offers a cohesive and comprehensive narrative within which he includes all manner of graphic illustrations as well as a number of exercises and questionnaires which enable both those who hire and those who are candidates to understand what topgrading is, what the CIDS interview approach is and how to derive the greatest benefits from it.

Most important of all), Smart explains how to achieve what Jim Collins describes so well in his most recently published book: the good to companies “…first got the right people on the bus, the wrong people off the bus, and the right people in the right seats — and then they figured out where to drive it. The old adage ‘People are the most important asset’ turned out to be wrong. People are not [italics] your most important asset. The right [italics] people are.” Presumably Smart would agree that the right people share the same values and, together, sustain their organization’s commitment to those values. If involved in their organization’s recruiting and interviewing process, as they should be, they will help to ensure that the right people will be hired (i.e. allowed on the “bus”). Obviously it is important to get talent and task in proper alignment. It is equally important to keep an organization’s values in proper alignment with its objective(s). Although Collins does not use the term, the good to great companies he discusses are all topgraders.

The reader will especially appreciate having the information provided by Smart in (count `em) seven appendices: CIDS Interview Guide, Career History Form, In-Depth Reference-Check Guide, Interview Feedback Form, Sample Competencies — Management, and Sample Competencies — Wm. M. Mercer. Here in a single volume is about all anyone needs to know and have inorder to understand what topgrading is, how it works, and why it will probably be essential to those who hire as well as to those whom they consider.

Lest there be any misunderstanding by anyone reading this review, I want to point out that any organization (regardless of size or nature) can be a topgrader and that is even more important to smaller organizations with limited resources. Why? Because the cost of a miss-hire could be catastrophic, not only in terms of total compensation but also in terms of mistakes, failures, alienated customers, lost business, wasted opportunities, and disruption of the workplace. Some may respond, “I cannot afford to hire all A players even if I could find them!” On Smart’s behalf, I presume to reply that no organization can afford NOT to hire only A players or high-potentials who, with proper development and supervision, can become A players. Replace those who do not.

Job security and retention of  A players are not entitlements: They must be earned