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At GE, it is looked upon as a success. Um, no. The back-story you're missing is that, up until about 1980, it wasn't uncommon for people to stay at one company

At GE, it is looked upon as a success. Um, no. The back-story you're missing is that, up until about 1980, it wasn't uncommon for people to stay at one company for 20+ years, even after they'd essentially ruined their reputations and were regarded as failures, because it was so disastrous and rare for people to actually get fired. So for companies to have 10 or 20% that was obvious deadwood was not rare. By "deadwood" I don't mean people who tried hard but took a long time to onboard or who worked on unlucky projects and could be rehabilitated, but I mean people who showed up at 11, left at 4, and might do no real work other than showing up for a couple meetings per week and making it obvious through inane comments that they didn't understand what was going on. The first year of rank-and-yank, few objected to most of the firings because the people let go were the obvious nonparticipants, and it was better to get rid of them than lose the whole company. By the second year, it was more tense. By the third and fourth years, it was an outright morale-killer. It turns out that the percentage of people in a company who deserve to be fired isn't a constant.

kamaal 14y ago
This is true, but not the whole part of it. In his book, Jack Welch says stack ranking put managers in a very difficult position around 3-4 years after it was implemented, simply because now they had choose worst among the very best. Of course not all of it is good, because even if you plan to hire and replace them by somebody else. What is the guarantee that they will be good? But he later also says, the functions of the HR in GE were very different than in other companies. They were treated on par with the office of the CFO. Since the HR itself is stack ranked, hiring wrong people means they will be getting ranked low and fired sooner or later. So they will be forced to hire the very best.

kamaal 14y ago

This is true, but not the whole part of it. In his book, Jack Welch says stack ranking put managers in a very difficult position around 3-4 years after it was implemented, simply because now they had choose worst among the very best. Of course not all of it is good, because even if you plan to hire and replace them by somebody else. What is the guarantee that they will be good? But he later also says, the functions of the HR in GE were very different than in other companies. They were treated on par with the office of the CFO. Since the HR itself is stack ranked, hiring wrong people means they will be getting ranked low and fired sooner or later. So they will be forced to hire the very best.