Thinking differently about differentiation

IIPM PUBLICATION

Q: I really support differentiation – ranking employees into performance categories of top 20%, middle 70 and bottom 10, and then managing them “up or out” accordingly. But don’t companies face all sorts of resistance when they try to implement this system? – Yoshihisa Tanizawa, Kuala Lumpur, Malaysia

A: ‘Resistance’ may be too soft a word! Yes, differentiation has its advocates – and even its hardcore devotees – but no other management practice that we talk or write about ignites the same firestorm of controversy. So thanks for asking about it. Your question gives us a chance to sort differentiation myth from reality. Done right, differentiation is not, for instance, “rank and yank”, with its purported public firings of stunned victims once a year. Nor is it cruel, corrupted by favoritism and culturally inappropriate.

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Source : IIPM Editorial, 2006, Arindam Chaudhuri's Initiative

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