What Does Producing Profitable People Mean?

The touchline is that when your system continuously Produces Profitable People, they'll uncover gold for the organization, like the guy above.

I conducted a LinkedIn poll a couple of weeks ago. I asked executives in disparate Groups what they deciphered as the meaning of "Profitable" in the phrase, Producing Profitable People.

Here are the results:

• 17% of respondents understood it to mean a Financial Gain for Both the Company & Individual
• 41% of respondents understood it as an Improvement in Efficiency & Productivity of the Individual
• 48% of respondents understood it to mean Gaining Valuable Skills & Abilities for the Individual

What's interesting about these responses is that a minority of people felt that there must be financial gain for both employees and the organization.

These people understand that within a business, you do everything to develop people in their respective roles to benefit the company financially.

If there's no financial gain, these activities shouldn't be done.

A for-profit business exists to generate profit.

Producing Profitable People refers to the concept of investing in employees in a way that enhances their skills, knowledge, and capabilities, which in turn contributes to the overall profitability and success of the organization. It's about recognizing that people are not just expenses on a balance sheet, but rather assets that, when developed, can yield significant returns.

As an executive coach, I emphasize the importance of developing individuals both personally and professionally. This development helps companies retain high-impact employees and creates a virtuous cycle where employee growth leads to greater commitment, higher competence, and ultimately, financial rewards for the organization.

In essence, Producing Profitable People means creating an environment where employees are encouraged to grow and contribute to their fullest potential. This aligns with the company's strategic goals and drives its financial success.

When a business is profitable, its people should also realize the financial rewards.

Recall that the last element of the 5Rights Wheel is Rewards, both financial and non-financial.

No one will hang around growing a company's profits and not be rewarded commensurately.

Your people retention will sink.

Measure

Every activity that's performed in a business should be measured.

What gets measured, gets managed. - Peter Drucker

If you don't measure it, you won't be able to manage it. And if you want to manage it, you have to measure it.

Here's an even more powerful quote about measuring activities:

That which is measured, improves. That which is measured and reported, improves exponentially. - Karl Pearson

Therefore, if you can't measure some activity within your business or you don't want to, then don't do it.

These measurements must be applied to all the five elements of the 5Rights Wheel.

1. If the person performing a role is not delivering results, then they should be trained, coached, and removed if there are no results.
2. If the training is not delivering results, then change the training.
3. If the KPIs are not being met, check if you're measuring the right things.
4. If the coaching is not delivering results, ensure the process is correct. And if it is, then remove the person being coached.
5. If the rewards system is not delivering results, then change it.

Case Study 1

Last week, the Chief Revenue Officer of a pharma company that I've done numerous training with, told me that her boss had asked what the impact of training was.

She was at a loss on how to respond.

I proceeded to ask her what would determine if the training had been effective.

She quickly realized that I was alluding to measuring the result of training in the field, i.e., if the sales managers were evaluating if the reps were implementing what they learned in class.

The sales managers had not diligently been measuring this.

And she realized she had to start pushing the sales managers to measure and coach the reps.

Case Study 2

Last month, I proposed to a healthcare company 2 training programs. One was for leadership development and the other a marketing training program.

I was disappointed they selected to do the marketing one first.

The reason I was disappointed was that they had people issues that had to be ironed out.

In any business, when you fix the people, the processes and product issues will be resolved with the right training and other interventions.

However, if you fix the processes and products first and then the people issues, the processes and product issues will recur. And so you will have to relook into the processes and product issues. It becomes a vicious cycle.

Conclusion

Producing Profitable People is an iterative process that uses the 5Rights Wheel.

Measure everything.

If it can't be measured, ditch it.

Focus on people first and then on processes and products.