The Problem with Stacked Rankings

Posted on April 25, 2014.

I'm actually on vacation so have re-posted a previous blog.  Since it's close to mid-year reviews, I thought it would be timely.

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, this was a task I really hated. I worked hard to build a great team it never felt good to have anyone on 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 nice way to assess talent?