At the same time that Microsoft abandon the old system that compels mangers to rate their employees on a curve and punish or even fire the low-end employees, Yahoo is debating whether it should adopt this ranking system
In order for the most efficient and economic business model, it’s seemingly reasonable for Yahoo to embrace this “Game of Thrones” in the office. Apparently, this new policy enables Yahoo to lower the cost moderately by getting rid of the least motivated workers who contribute less than the payment they receive. In addition, a competitive environment will be established, where everyone is driven to work harder by the extrinsic motivation such as money, rather than intrinsic factors such as his or her own passion and self-actualization, which are more likely to yield to a more outstanding results.
(Here’s Ted Talk about extrinsic motivations fail in some ways The puzzle of motivation)
Hence, every coin has two sides, mechanically rating the employees’ performances on a curve, which is mostly determined by the manger’s observations and opinions, is arbitrary and defective. In other words, employees will easily shift their focus from their duties to some negative political behaviors. For instance, some of the employees try to ingratiate themselves with the mangers and backstab their colleagues in order to save their jobs. As the research operated by the Institute of Corporate Productivity shows that the number of companies using a forced ranking system is constantly shrinking in these two years.
All-in-all, human resources plays a key role in the success of the company. Therefore, Yahoo should be cautious about the stack ranking idea and analyze the benefits and drawbacks of this new policy before the implementation in the organization.
Sources:
http://www.businessweek.com/articles/2013-11-12/yahoos-latest-hr-disaster-ranking-workers-on-a-curve#r=read
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