Since it began drawing widespread attention from several top-ranking companies in the 1980s, stack ranking is being viewed – to some extent by managers who are entrusted with the job of ranking the employees on a bell curve and to a greater extent by the hapless employees – as a highly controversial system which can only help to create divisions among the employees thereby forcing them to under-perform. With Microsoft becoming the latest to join the list of companies deciding to drop the “rank and yank” technique, several eyebrows have been raised over the real purpose served by stack ranking.
Why use of stack ranking has gone down in recent times?
More and more companies have started realizing that the process is not yielding the desired results, and that it only goes to affect their performance. As per a study conducted by the Institute for Corporate Productivity (i4cp), the percentage of companies using stack ranking has plummeted from 49% in 2009 to a mere 14% in 2011. Importantly, “high-performing” companies have already started distancing themselves from the controversial system, with only 6% of such firms using the system in 2011 compared to 7% of users in 2009.
What actually has led to sidelining of stack ranking system?
Keen on taking a more analytical approach, Human Resources has started ascertaining that the numbers made available by stack ranking fails to point to success. Also, the findings by the system doesn’t help in promoting innovation. As a result, a large number of companies have started shifting their focus to alternative systems that can guarantee better flexibility, and those that provide a regular feedback about the employees and how to enhance their performance.
Does stack ranking really helps to measure workplace skills?
“No”, says Cliff Stevenson, senior human capital researcher at i4cp. Although a majority of companies make use of some type of ranking to rate their employees, such a set-up is only forcing the managers to prepare a list of reviews with “good” and “bad” ratings. In many instances, managers are left with no other option but to rate some employees as “poor”, to do justice to their review.
With the employees feeling very uncomfortable and the managers becoming embarrassed with the process, stack ranking’s popularity has been steadily declining, and companies, in general, feel that such a system can only affect their performance in the long run. After all, no company will be interested in encouraging a procedure that is more likely to prove “counter-productive”.