Corporate E-Learning
Wednesday, November 16, 2005
Forced Ranking: Making Performance Management Work

by Dick Grote

I read this article with unease. It is just intuitively not right.

I cannot argue against statistics and controlled experiments and the conclusion of the article may be right for the industrial age companies. I cannot see how my companies (if they ever grow enough to require these kind of strategies) will adopt such a measure.

As I have explained elsewhere, the jobs available in the near future, at least in developed countries would be very different from what are available today. Repetitive jobs would be replaced by computer-driven processes, or completely replaced by computers. Human workers are here to tackle "exceptions", those situations that the computers cannot handle correctly or appropriately. It is likely that workers are assembled in short notices in order to solve problem with extremely compressed time because the rest of the business is moving at light speed.

Definitely, companies will need talent more than ever in order to survive. Maintaining a highly effective talent pool is critical.

However, a forced ranking system, given the inherent nature of human bias, will only make your talent pool worse to cope with diverse situations.

Firstly, forced ranking implies measuring scales which are uniformly applicable across a diverse group. Such scale typically will remove diversity which is critically important to "tiger-teams".

Secondly, any organisation, when grow to a certain respectable size, will have internal politics. Such politics create associations and will influence the application of any measuring scales.

Thirdly, such a brutal system will harbour bribery. People use extreme tactics under extreme situation. When the job security is gone, those in power will extract maximum personal return while they can.

Anyway, I have a thousand more reasons not to implement forced ranking in my companies....
you're wrong. I implement performance ranking at my company and the employees seem to know who is doing better than others and rank themselves almost. It promotes fairness when the performance is tied to pay and encourages real growth rather than pandering to the supervisor. You can discourage petty politics by ranking lower those who participate in it. And encourage teamwork and transparency by ranking higher those who show it.
Hi Joseph,

I was commenting on forced ranking, not on general appraisal. I was also looking into my type of company, unique solution provider and tackling vastly different mission every different project.

Obviously management styles come into play as well.

We just have to agree to disagree.

Here are the steps how to improve performance of a person.....
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