The Problem with Stacked Rankings

In most large corporations, like my former employer, you are required to stack rank all the employees that work for you at least once a year.  At best, stack ranking forces a manager to view performance on a relative basis. At worse, it’s used as an arbitrary and biased tool for corporate layoffs. I resented having to stack rank my team. Here’s why.

 
 
 
 
 
 
  • You’re forced to put valuable, contributing members of the team on the bottom. If you’re doing your job as a manager, you’re assessing performance throughout the year, providing ongoing feedback and constantly managing people up or out. So unless you have a new hire or someone who’s just having an off period, you should end up with a pretty solid team. How do you decide who’s on top and who’s on the bottom?  Basing it strictly on results ignores attributes that contribute to everyone’s success like being an informal mentor or strong team player.
  • Every manager defines excellence differently.  We are only human.  One person’s rock star is another person’s pain in the butt.  One manager will put the rock star at the top of the list, the other in the middle. Who’s right? And when the corporation makes people decisions, who’s opinion is valued more? The subjectivity alone of this exercise makes it meaningless.
  • Anyone can have a bad year. Since stacked ranking is usually done annually, having one off year can put a great employee at the bottom of the totem pole in the one year there are massive layoffs.  Forget about the other ten years of great performance. You now risk seeing a solid performer lose his or her job.  No one would put someone at the bottom after one bad year you say?  Not true. I’ve seen it first hand, as there is so much pressure from above to rank on the most recent performance.

Admittedly, as a manager, this was a task I really hated. I worked hard to build a great team and it never felt good to have anyone at the bottom of a ranking.  Stacked ranking is a lazy way for managers and executives to see who is promotable and who should be fired.  It’s so much faster than actually reading through performance appraisals and getting feedback from peers and customers. Wouldn’t that be a better way to assess talent?

 

Comments

stacked Rankings

My biggest struggle w/ stacked rankings is this:
As the Manager in a stack ranking organization..., you are rewarded for promoting or "stacking" the greatest of the greatest. This encourages over ranking. Who amongst us would want to attend a leadership meeting and say none of our team is high potential? And those who want to progress, knowing the need to promote and develop high potential, have an incentive to inflate performance of these individuals....
it seems to me, just looking at the math, stacked ranking promotes politics.

stacked rankings

You are so right. I had forgotten that ranking can also inflate the perception of the mediocre within an organization. Thanks for your comment.