A double-check in defining the work to be done at each level of complexity in a company can be done by looking at “the target completion time of the longest task, project or program assigned to that role.” At stratum 1, the production line or the data entry operation, it might take a day to set up a lathe or 20 minutes to enter form information. At higher levels, tasks extend farther in the future: perhaps two years for a sales manager to rebuild a marketing organization for five years for a CEO to turn around a company. Field research showed that across all types of organizations people were consistent in their cut-off points for various stratums: Three months for stratum 1, one year for stratum 2, two years for stratum 3, five years for stratum 4, and 10 and 20 years for strata 5 and 6. Using these metrics helps refine role assessments for an organization.

Matching Human Capital to the Roles That Exist in an Organization

Elliott Jaques spent decades testing the cognitive abilities of people in various strata, and can now reliable predict their capacity to rise to various levels. This cognitive ability ranges from the very concrete (“hand me that broom”) to the very abstract, in which a person is capable of imagining several chains of possible consequences and relating one possible outcome to the others.

In their article “The Overlooked Managerial Competency: Observing Complexity of Information Processing (CIP) to Match People to Jobs and Determine Future Potential” Glenn Mehltretter and Michelle Malay Carter outline the process of measuring cognitive ability. Excerpting from their paper they define a person’s complexity of information processing (CIP) as the maximum quantity and complexity of information that can be processed by the brain at the present time. CIP was found to be a determining factor of the level of work, in terms of complexity, an individual can successfully perform. Becoming familiar with CIP levels was found to give managers a universal and consistent way of observing and discussing which employees would be suitable for varying levels of jobs. The process used by Mehltretter and Carter consists of examining both the structure and content of a person’s speech when he or she is fully engaged in arguing a point.

To show a simple example of how this works Mehltretter and Carter state the first four levels of CIP capability necessary for organizational work. Note how each successive level allows for increasingly complex approaches to problem solving. Sample interview excerpts of people demonstrating the various levels of CIP follow each definition. As you read them, pay particular attention to the way the subjects group and organize their information. This can be done by attending to the connecting words such as or, and, if, and then.

1. Declarative problem solving is the least complex. It is representative of the problem solving needed in shop and office floor roles. It does not include the ability to see things coming. In work situations, it involves following procedures and addressing “glitches” only as they are encountered. Solutions are formulated in terms of independent thoughts. There is no explicit connection between or among ideas. This form is akin to disjunctive logic of A or B or C. Common jobs requiring this level of problem solving are: Clerk, cashier, many administrative assistants, line worker, and many technicians.

When asked the question, “How can we improve productivity at our manufacturing plant?” a person (Assembly Line Worker John) using declarative problem solving might answer: “We need better equipment. It breaks down too much. Management should listen to line workers ideas more. We could help, but they don’t ask. They should rework the scheduling so we’re not so tired all the time from pulling long shifts.”

The speaker presents three independent ideas. The solution could be doing any one of these, as opposed to doing all three of these. There is no explicit indication that two or three of the ideas should be done together.

2. Cumulative problem solving requires one to accumulate bits and pieces of information and begin to see a pattern: in other words – the ability to see things coming and be proactive. Solutions are formulated in terms of an explicit accumulation of related thoughts. The proposed solution is the weight of the sum of the parts. This form is akin to conjunctive logic of A and B and C. Common jobs requiring this level of problem solving are: first line manager, some district managers, many retail or restaurant managers, entry engineer, scientist, or programmer.

When asked the same productivity question, a person (Assembly Line Manager Susie) using cumulative problem solving might answer: “Our equipment is ancient. It breaks all the time. We need updated equipment. Besides that, a suggestion box might help. The line workers have good ideas, but no one takes them seriously. The first suggestion I would put in the box would be for new equipment. And another thing we should do is make the schedules more consistent. We have people moving from day to night shift too frequently, and we require too many double shifts.”

The speaker presents the same three ideas as in the preceding example. However, its explicit that implementation of all three parts is intended.

3. Serial problem solving requires the ability to see a series of cause and effect relationships. Solutions are formulated in terms of explicitly stated sequences of at least three items. This form is akin to conditional logic of If A then B, and if B then C. A→B→C. Common jobs requiring this level of problem solving are: some district managers, some regional managers, unit manager, any manager of first-line managers, sr. engineer, scientist, or programmer.

When asked the same productivity question, a person (Department Manager Joe) using serial problem solving might answer: “Our equipment breaks down all the time. This wreaks havoc with our scheduling and requires we reschedule employees for other shifts and/or have them pull doubles when the equipment is working. So we need to get the equipment replaced and then create a more consistent scheduling plan. It might make sense to get the line workers’ input on what type of schedules they would prefer before doing the plan.

The solution is a three-fold sequence of events. Replace equipment → Seek scheduling input from line workers → Create more consistent schedule

4. Parallel problem solving requires the ability to see connections among multiple serial paths. Solutions are formulated in terms of explicit relationships between two or more series. This form is akin to bi-conditional logic of If A then B, but if and only if C then D. Note that Serial problem solvers can conceive of multiple serial paths, but they deal with them independently. Common jobs requiring parallel problem solving are: large plant manager (250-300 people), director, general manager.

When asked the same productivity question, a person (Plant Manager) using parallel problem solving might answer: “Well it’s obvious that we need new equipment to reduce downtime which kills our productivity. However, new equipment will call for much more electronics and computer savvy on the part of our maintenance staff. So, we need to begin to upgrade our maintenance department’s capabilities and to add staff now to prepare for the new equipment. At the same time, new equipment may make some line workers jobs obsolete. In order to minimize layoffs, we should see any line workers are interested in cross training in maintenance and eventually becoming part of the maintenance staff. Once all that settles down and all the training is done, we can make our scheduling more consistent. Our current scheduling is at the “will” of the equipment. I know it makes the associates angry and there’s no telling how many ways that impacts productivity.

The solution contains several explicitly connected series. The plant manager may need to slow down or speed up certain series in order for them all to come together at the step that is shared by all the series – Buy equipment. The end result of all these series being deployed interdependently is higher productivity.
Capital Investment Series: Buy equipment → Less down time → Higher productivity
Department Upgrade Series: Upgrade maintenance dept. →Hire more maintenance technicians → Buy equipment
Direct Labor Series: Find line workers who want to enter maintenance → Begin cross training → Buy equipment → Some line workers become maintenance staff
Scheduling Series: Buy equipment → Training → Scheduling overhaul → Higher productivity

There have been found two equally reliable and valid methods for judging mental capability potential – Direct Observation and Managerial Talent Pool Evaluation.

The method of direct observation of CIP described above allows evaluation of mental capability as people converse in a variety of everyday situations. Elliott Jaques scientifically validated that accurate results can be achieved through direct observation by a trained observer. When employee selection decisions are being based on the observation technique, the protocol is for interviews to be recorded, transcribed and examined on paper in order to ensure accuracy of the observation.

An alternative approach can be used when an organization desires to judge the current potential of current employees rather than outside candidates. This approach, the Talent Pool Evaluation process or TPE, involves groups of managers and managers-once-removed making these judgments following a facilitated group process. Results between the two processes correlate at the 0.95 level.

It should be noted that there is a strong correlation between cognitive ability and time horizons. That is the better we are at processing information, the farther we are able to project ourselves into the future. This becomes acutely important when a CEO’s cognitive abilities fail to match the level of hierarchy he or she occupies. In this case what happens is that he or she shrinks that company down to his or her own level.

These examples illustrate how people can have their mental capability (Human capability to process Information) assessed at a point in time. One’s ability to process information is not however static. It matures with age in a predictable manner. Therefore, once an adult’s current complexity of information processing is identified, his or her rate of growth (future potential) can be forecasted using Jaques’ empirically developed and longitudinally validated progression curves.

For reasons not yet understood, some people mature to a higher level of information processing capability by the end of their careers. This is why some people desire to move up the corporate ladder to more and more complex jobs (high potential mode), and others are content to stay within one job throughout their career (expert mode). A full appreciation of this concept can help managers use their employee training and development dollars most effectively. Knowing an employee’s progression path will point toward one of two developmental strategies: increasing depth of knowledge (expert mode) or breadth of knowledge (high potential mode).

Progression of Mental Maturity of Individuals

Excerpting from Alexander Ross in the Canadian Business Journal, the biggest insight (and controversy) in this approach to Human Capital planning is the finding that each person has an inherent potential for cognitive development and thus equipped to rise only so high, and not higher, in an organization. Learning and experience will enhance their skills and knowledge, but no amount of positive thinking can change their potential to approach problems in increasingly sophisticated ways. This is illustrated in the “Progression of Mental Maturity of Individuals” figure.

The recommendation is that annually an organization assesses the roles that it has and will need over the next five years, then map the mental capabilities of its members to those roles. In R&D and other specialty organizations with non-transferable Skills, the mental capabilities for each Skill type must be kept separate in the planning process. Key is to provide high potential individuals (those destined for stratum IV and V) work challenges commensurate with their capabilities, or otherwise they are at high risk of leaving the company for another job.