In addition, they claim it’s a vital tool to identify the bottom performers who should be helped up or out. Proponents say that forced ranking is the best way to identify the high-potential employees who should be given training, promotions and financial incentives. More commonly, employees are grouped into three, four or five “baskets,” usually of unequal size, indicating the best workers, the worst and one or more classifications in between. A group of 100 workers can be ranked one through 100. Also known as forced distribution and, derisively, as “rank and yank,” the practice was championed by former General Electric CEO Jack Welch, who insisted that GE identify and remove the bottom 10 percent of the workforce every year. Experts estimate that it is being used by at least 20 percent ofįortune 1,000 companies and growing, fueled in part by pressures to identify large numbers of people who can be laid off as the economy stumbles along.īut many executives, consultants, academics and HR professionals are raising red flags about the practice, which has resulted in costly litigation, bad publicity and plunging morale at some firms where forced ranking has not worked well or has achieved a purpose at a steep price. While grading employees on a scale relative to each other forces a hard look and finding keepers, losers may become weepers.įorced ranking, the controversial process by which employees are graded against each other instead of judged against performance standards, is all the rage in corporate America.
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