Activision|Blizzard|King (aka ABK) is a $50+ billion dollar video game publisher working as hard as any corporation you know to generate as much bad press for itself as possible. Latest news item: Blizzard terminates leader because they wouldn’t abide by the requirements of stack ranking policy.
Stack ranking is ostensibly a method for producing high performing teams by forcibly evicting the lowest performers in a given group. Everyone gets their annual performance assessment (“How much do you like annual perf reviews, Keith?“) and the employees with the lowest 10%-20% scores are put on the fast track to finding new employment. On paper, this sounds good. Every year we’ll cull the worst performers. Genius.
Now let’s talk about what actually happens.
I’ve got a team of 10 engineers. They’re all stellar. World class. In fact, the worst of them is 10x better than anyone else at the company. Come review time, I have to give two of them a “needs development” score. They both leave within three months. I now have a team of 8 of the best engineers in the world. Our competitor now has two more than they did last year.
But that’s not all.
Throughout the year – and especially leading up to perf review season – everyone on the stack ranked team is aware that they only get to keep their job if they’re better than most of the team. At this point, the system seems to be working as intended: everyone works harder and harder to be the best. But now each team member strives to get the highest scores for them. They work on projects for them. They don’t collaborate. They don’t mentor or coach.
Sounds bad, right? It actually gets worse.
We have about 50 years of knowledge in the field of behavioral psychology that shows very, very clearly that innovation and creativity are stifled by external motivation. Carrots and sticks have the opposite effect on knowledge work – fields like technology and, say, video games. Threatening people with being fired for underperformance is a very large stick.
Congratulations, you’ve found a way to demotivate the entire company and generate worse results.
A major downfall of this system is that it puts the onus of improvement on the employee. You in the bottom 10%? You need to improve. Never mind that you might be amazing and its just that the other 90% are amazinger. You’re the problem.
Where’s the involved manager in all of this? The reverse implication of stack ranking is that any given team of 10 will also have a top 20%…even if all 10 are tragically underperforming by any objective measure. How are we holding the manager accountable for having 10 underperformers? In any group of 10 managers, how do you know which two of them should be let go for being deficient leaders? And what happens to their teams?
I searched and searched for a single review anywhere of an actual human describing how stack ranking benefited their company. I only found one video in which Dave explains the best way for employees to not get fired during the stack ranking era at Microsoft: work for a manager who likes you and will advocate for you in performance discussions. That, and don’t work on challenging problems.
Honestly. It’s just turtles all the way down.
Do This Instead
Use what we know about motivation. Deliver clarity to team members.
- Create explicitly documented measures of success for each step in each career ladder. If you’re engineer level X, you can read a set of bullet points to tell you if you’re doing a good job. Want to know how to get to level X+1? Read the next set of bullet points.
- Train. Your. Reviewers. Honestly, the number of times in tech we just put someone in charge of managing others without teaching them any of this is mind boggling. Create a curriculum. Too daunting? It can be a one-slide deck. Have every manager learn how to do reviews. Assessing humans is hard. The results will never be perfectly consistent and objective. But this is how you get as close as possible.
- Assess team members based on the standards you create. No curve. Their actual performance is what matters. Team isn’t high performing enough? Fine, raise the standards. It’s your company, it’s your prerogative.
This gives your people the clarity they crave. It can also give you great performance and point out when people aren’t measuring up. So you get what you want for your org without demotivating anyone or turning the workplace into a zero-sum battle royale.
I will point out that this is more work than stack ranking. You have to train people. You have to create standards and see to it they’re applied consistently. You have to have managers who dedicate time to helping people improve.
It’s also vastly more humane, and doesn’t land you in the news for yet another corporate misstep wondering if this is the one that makes Microsoft back out of a deal to purchase your company.
image courtesy of Arisa Chattasa on unsplash