Forced Ranking (Stack Ranking)

Definition

A performance management system requiring managers to rank employees on a curve, with predetermined percentages for top, middle, and bottom performers, designed to be 'objective' but intensely demoralizing.

Example Usage

Under the forced ranking system, 10% must be rated as top performers, 80% as solid, and 10% as underperformers regardless of actual performance.

Origin

Popularized by Jack Welch at GE in the 1980s-2000s.

Fun Fact

Most major tech companies abandoned forced ranking after realizing it created competitive rather than collaborative cultures and damaged retention.

Source: Performance management terminology

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