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I loved reading Jack Welch's books on management. He is a charismatic and energizing leader.

One of his most controversial point of view is the "Differenciation" policy. And I have a big doubt on this one !

Very simply : the trick is to rank your people in 3 categories : Good/Average/Poor performers representing 20%/70%/10% of your staff.

You have a different treatment of each category. By getting rid of the 10% poor performers, you regularly get a better and better company.

The other trick is : you never stop this "selection" process, always getting rid of your 10% poor performers !

I would like to know your opinion on this system and hear about people who have experimented it.

- what kind of team spirit do you get with such a system ?

- how can you rank different people ? Allan may be good at this and bad at that, when Susie is bad at that and good at this. Together they make the perfect team ... Do you want to rank one against the other ?

- why rank people inside the group ? Isn't it better to ask them to get better than yesterday and not as good as tomorrow ?

- Ranking sales people may be simple. But it is more difficult with techs, finance people, admins, etc.

- How would it feel being in the 70% category ?

WillDuke's picture

[quote]Which proves the point that unless the 20-70-10 process is implemented properly[/quote]
But in all fairness, is there a system that cannot be abused? At the end of the day, any tool is only as good as the technician wielding it. I have a hammer and built a home. I had a hammer and caved in someone's skull. It's just a hammer, I did the work.

Also, there's an old saw about "when all you have is a hammer then all your problems begin to look like nails?" A good technician is going to have a saw and a screwdriver and a power drill and a whole toolbox full of stuff that they know how to use.

Don't blame the tool if it's used inappropriately.

lionel's picture

Will - excellent point. Any tool can be abused and statistics can be used to make nearly any point one wants. I recently saw an letter to the editor of my local paper making the point that doctors kill more people by accident as a percentage of the population than do people with guns. While that may be true the relationship between the two is not relevant.

When a 20-70-10 process is implemented it must be implemented with the right training, oversight, communications, etc. so that it is not abused.

terrih's picture

[quote]But in all fairness, is there a system that cannot be abused? At the end of the day, any tool is only as good as the technician wielding it. I have a hammer and built a home. I had a hammer and caved in someone's skull. It's just a hammer, I did the work. [/quote]

Now you done gone and put songs in my head... "If I Had a Hammer" vs "Maxwell's Silver Hammer" :?

:lol:

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