Rank and Yank
An interesting article appeared in yesterday's USAToday suggesting that the practice of lopping off the bottom 5% - 10% of the workforce improves company performance. The article cites a study which appeared in Personnel Psychology which suggests that after a few years, however, the lopping no longer works as "deadwood can only be removed once." Apparently the authors of the study (which claim that productivity improves during the first two years of this practice by 16%):
"...stop short of recommending rank and yank because the study does not take into account intangibles such as morale, workplace cooperation, turnover and lawsuits."
OK, now excuse me if I insult anyone here (and I'll refrain from typing this in all caps and bright red!), but anyone who implements a new policy or practice without considering any of these so-called "intangibles" has to be out of their mind! When I was in graduate school they told me that the costs of turnover could actually be measured - In fact, I thought this was basic HR. And, lawsuits intangible? You're kidding, right? It seems pretty clear to me that the rank and yank methodology, particularly where we do forced ranking, although it may improve productivity, has a slew of negative consequences that I would guess probably wipe out all of those so called productivity gains. Perhaps if we focused on developing employees, implementing performance management programs that communicate and hold employees accountable, we might actually be able to improve performance without having to sort our employees into little boxes. In fact, with greater expectations and accountability, the least productive might weed themselves out. I'll get off of my soap box now....
Posted By Diane Pfadenhauer In Performance Management | Permalink
