For some people getting the job getting hired is as far as it goes. And in time they will need to go. If you are unhappy and are unable to help the company make money then they need to find you a way out even if you do not have the stones to find an exit yourself.

One anecdote he shares is about the stewardess called him mister and the guy next to him doctor. He said he liked the sound of doctor better and so continued in school earning a doctoral degree. Before he became a researcher or whatever He also blew the roof off of a building in his early years.

We call these outsized personalities supremely confident and self assured but they are desperately chasing what? A win? What makes it so important for them to win? And when they win it’s what’s next? They are rogue or lone rangers but only in a win at all costs way. They are on some level desperate for the approval from “winning.” Ambition without reason is pretty empty. At first it’s about those above you recognizing you deserve to be invited up the ladder. In time it becomes your turn to invite others to join the mucky mucks at the club.

Not everyone deserves a ribbon for their efforts like athletes at the Special Olympics. Jack talks about telling people the truth. Besides most of them already know they are falling behind. As uncomfortable for management and painful for employee they deserve to be told the truth. Hopefully they will find their niche where they can contribute and be rewarded for accomplishment. It’s no fun to crush someone’s dream unless you are just cruel bastard. But that’s why they get the big bucks.

Thanks for stopping by.

I’d agree with a lot of your post, but every GE product I ever bought was a dog. Thinking of the 90′s before I learned my lesson.

GE were also terrible with warranty support.

So given the company’s track record with me, I’d have to say that 20-70-10 is a horrible way to run a business.

That said, we have a strict not-a-fit, goodbye policy at Foliovision now. I’d hate to put numbers on it, but there’s no way a small company should be keeping people around who don’t advance the cause in terms of spirit. Just turning up to work and doing your job is not nearly enough.

GE happens to be very competitive and so the 20-70-10 regime fits that culture. What Welch drives again and again in both of his books is the importance of differentiation.

It’s recognizing two things in an organization: not everyone is equally effective and people want different rewards for their work.

Also, differentiation forces management to have a system of evaluating employees that is fair. From my many years in various organizations I have seen clearly that there is a wide divide between what management believes employee satisfaction to be and what employee say to each other when management isn’t there. The last time I’ve researched it, nearly 80% of people are not happy with their current jobs.

The 20-70-10 is something specific to GE. From your post I get the feeling that you have a bias without trying to understand the idea.

The major benefit of removing the bottom 10% is that it forces managers to defend their appraisals. Most companies out there have some form of appraisal, but probably 80% of them just put them in a drawer while the real decisions regarding advancement and salary are more impacted by who is friends with which manager.

I’ve had to fire people that were a poor fit, not because they were a chronic under-performer, but because it was obvious they weren’t happy. I took the time to help them get a new job and they have become top performers in their new roles.

As any skilled manager knows getting the right person in the right role is not easy, but is critical to success. 20-70-10 isn’t perfect, but has seemed to work exceptionally well for GE. It’s hard to generalize about a company that has a few hundred thousand employees, but I think given the company’s track record, they certainly do some thing right.

I still think there is something wrong with presuming that 10% of your workforce is deficient. It’s the ultimate mean-spirited musical chairs.

I suppose with a company as big as GE you do treat it as a numbers game. But what might be true in one department (20% crappy workers) might not be true in another (98% stellar performers).