Have you heard of Jack Welch’s Performance-Value Matrix?
It’s a simple tool used to evaluate team members and leaders based on two key dimensions: performance and values.
I’ve been running this with dozens of clients, friends and some candidates over the past few months and nearly every single one of them looks like this:
That diagonal correlation appears nearly every time.
After lots of research, the TL:DR is that “leadership should view employee performance and core values as two distinct elements of enhancing organizational performance” (Workdove, 2025). Simple.
What we’re seeing in the new age of AI, is that employees outside of the High Performance/High Values quadrant are being moved out, quickly.
New leaders, business models and Org structures are just not accepting of them.
This is also why Graduate Hiring has fallen 50% in the past 5 years – they unfortunately don’t tick the High Performance box. Parents of teenagers, I’d love to hear what your career advice is at the moment…
This is the matrix that CEOs are now living by.
And if CEOs aren’t living by this, they are the ones being replaced.
Average headcount has peaked. We will never see companies with so many staff ever again.
More companies, less staff.
Less staff, better staff. No concessions.
When Reed Hastings, Founder of Netflix, couldn’t afford to keep his 90 staff when they were in early strife, he sat down with his execs to make a criteria for how they would do it:
Looks familiar, no?
Whoever didn’t make the list was let go.
Hastings was bracing for a backlash that never came. The opposite in fact happened. People were happier and performance, with a smaller team, rose.
This was Reed’s ‘falling apple moment’ – the talent he had was diluted by those who didn’t share their values and were hiding behind lower performance.
Netflix’s dedication to “high talent density” – the ratio of high values/high performers to lower ranked staff – led to their survival and shaped everything that came next for them.
I might be the only recruiter on planet earth telling you to “hire less”.
Though I must urge you to “hire better.” Better performers, higher values.
To compete, your team must look like the top right quadrant only.
This approach is also creating a new organisational phenomenon I call rapid diversification*.
*Rapid Diversification is often associated with morphological or ecological adaptations that allow organisms evolve into a wide variety of new forms or species in a relatively short period. Occurring when new ecological niches become available.
With such great teams, in such a niche environment, companies are not consigned to one product, business model or problem space.
A number of our newer clients (lean, AI-focused teams, hiring exceptionally talented people) are building completely new product lines to serve completely different clients. It’s incredible actually. They have the infrastructure, culture, systems and people to move fast – so once their original product can move into BAU, they can then focus 80% of the company on a completely new idea. And then repeat again.
Because they can.
I can see a near-distant future where companies with 20 staff are housing 4-5-6 well-known Logos under their umbrella, without anyone needing to recognise any correlation.
This deepens the mote whilst keeping their team super motivated: innovating in a new area, facing new exciting challenges and moving fast.
And, it is the model that Tier 1 talent is asking for.
So that they can expand their skills and experience, with new role titles and responsibilities, without having to leave a company dedicated to hiring exceptional people only.
In the end, the only matrix that matters is the one where your best talent wants to be.
