While navigating the holiday party circuit a couple of months ago, I ran into a friend complaining with her coworkers about their recent performance evaluations. Their company used a forced ranking system, so despite the fact that all of them had excellent performance records, only one of them could receive the highest ranking. My friend was upset not because only one of them could be on top (a natural way of life in the business world), but because when she asked what she could do to improve, her confused manager sputtered for a few minutes but was unable to articulate an answer. Finally, the manager admitted that my friend had met all of the metrics for an excellent ranking, she just was unable to receive that score because of the forced ranking system.
That friend started a new job yesterday. Many of her coworkers are either already in new positions or are currently on the hunt.
Forced ranking became popularized at many Fortune 500 organizations throughout the 1980’s, favored because employees were ranked based on their performance rather than personality, popularity, or other extraneous factors. Forced rankings also let employees know exactly where they stand, and show organizations who should be promoted and who should be the first to go during layoffs.
Forced rankings simply aren’t the best option when it comes to creating an engaged workforce. Instead of celebrating employees’ hard work, forced performance ranking systems cause managers to look for a reason to cut employees down in order to fit the correct percentage of employees into each ranking. The problem is magnified in small departments, where the manager is only allowed to put one or two employees into the top category. A manager may have three star players on his team, yet still have to mark one of them as only meeting expectations rather than exceeding. The employee who “gets the shaft” will end up feeling undervalued and is much more likely to become disengaged, bringing negativity to his work group and the organization as a whole. The negativity caused by forced ranking systems can create a toxic work environment where employees are more likely to backstab and complain about favoritism, ultimately leading to a less productive and less engaged workforce.
Instead of forced rankings, organizations should rely on absolute rankings, where any number of employees can fall into each ranking category, i.e., exceeds expectations, meets expectations, or does not meet expectations. This practice doesn’t just prevent star players from being forced into a lower ranking category. It also stops managers from having to put employees who may only be mediocre performers into higher ranking categories, causing these employees to believe they do not need to improve.
In the case of my friend, perhaps if an absolute ranking system had been used within her organization and all of their star players were recognized accordingly, her manager would still have a full team rather than many open slots to fill. Seeing a real-life example of how employee dissatisfaction in the workplace can affect retention should be a wake-up call. For any organizations still using forced ranking systems, now is the time to reconsider.
