Microsoft abandons controversial employee ranking system

Grading system stopped teamwork, said critics
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Grading system stopped teamwork, said critics

Microsoft is halting a system where employees were graded as top, average or poor performers, in order to try and encourage teamwork between workers.

Under the stack ranking system, employees were rated on a curve, with the best, average and poorest employees separated into three different groups, which could affect bonuses and promotions.

One large criticism issued by observers was that the method of operation by which the curve was decided meant that some poorer-performing workers were always required, even if the entire employee base was extremely successful.

In an email outlining the removal of the system, Lisa Drummel, head of human resources at Microsoft, said that a bigger “emphasis on teamwork and collaboration” was being adopted.

“This is a fundamentally new approach to performance and development designed to promote new levels of teamwork and agility for breakthrough business impact,” she added.

“This change is an important step in continuing to create the best possible environment for our world-class talent to take on the toughest challenges and do world changing work.”

Other companies have also adopted versions of the stack ranking system in the past, including Amazon, Facebook and Yahoo.