Former General Electric chief executive Jack Welch famously promoted the “20-70-10” system to increase labour productivity. Managers were asked to rank employees on a bell curve; the top 20% received rewards, while the bottom 10% were fired.
Yahoo, Amazon and IBM, among many others, later adopted this performance review approach, termed stack ranking, forced ranking or “rank-and-yank”. Similar practices – termed “up or out” – dominate law firms, accounting firms, the military and professional sports teams.
