Last week, I raised the question about whether we’re slipping backwards into outdated management practices. Today, I want to dive deeper into one of the most controversial practices making an unexpected comeback: “rank and yank,” or stack ranking.
Made famous (infamous) by Jack Welch at General Electric during the 1980s and 1990s, rank and yank involves rating employees directly against each other, rewarding the highest performers, and often dismissing those ranked at the bottom.
This approach was heralded in management articles and books as the way of the future back then. Welch was celebrated and this practice was thought to be one of the determining factors behind the GE Success story.
Funnily enough, the practice quietly disappeared in 2015. No articles, no fanfare, it was just gone.
It largely disappeared due to its harmful effects on culture and morale.
Fast forward to 2025 where recent reports indicate it’s quietly reappearing, especially in Silicon Valley.
Korn Ferry’s May 2025 article, “Are ‘Rank and Yank’ Performance Reviews Making a Comeback?”, spotlights this surprising revival. Tech companies argue that today’s advanced analytics and artificial intelligence (AI) make the ranking process fairer and more precise.
Why Companies Are Bringing It Back
A few of the reasons behind this recent trend include:
- Objective Measurement: Advocates claim AI and detailed data can significantly reduce biases and favoritism.
- Boosting Productivity: Clearly distinguishing between high and low performers supposedly creates a high-achievement culture.
- Focused Development: Some firms insist they use rankings constructively—to help pinpoint developmental needs rather than simply cutting jobs.
Why It’s Still Problematic:
But let’s be realistic—critics remain strongly skeptical, and for good reasons:
- Toxic Work Environment: Even “fairer” rankings can spark intense competition, eroding trust, teamwork, and morale.
- Short-Term Thinking: While productivity may spike briefly, innovation, creativity, and long-term employee engagement typically decline under such pressure.
- Losing Talent: Talented employees who feel unfairly judged might choose to leave, diminishing the company’s future capabilities.
Real-Life Impacts:
Several Silicon Valley companies already using stack ranking have witnessed significant fallout. Thousands of employees labeled “underperformers” have been let go, leaving remaining staff feeling anxious, mistrustful, and overly competitive – conditions hardly ideal for sustained productivity or innovation.
But is there something more insidious afoot?
Here’s what really intrigues me. Could the revival of harsh management practices be a subtle indicator of something bigger at play? Personally, I wonder if organizations might be gearing up strategically for a future heavily influenced by AI and automation. Clear, data-driven performance metrics might be increasingly essential for managing workforces that blend humans with intelligent systems.
Is today’s move back to traditional, numbers-driven management a precursor to tomorrow’s workplace?
Next week, we’ll unpack another trend pointing towards this broader shift back to more traditional practices. Stay tuned!
