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The Rights Of Best Practice Performance Management Schemes

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There is a growing recognition as evidenced by academic literature that the adoption of best practice performance management schemes are important to attract and retain high performing talent in the workplace (MacDuffie 1995; Delaney and Huselid 1996; Delery and Doty 1996; cited in Marchington and Grugulis 2000). As described in the works of Jeffrey Pfeffer (1994, cited in Marchington and Grugulis 2000) it is believed there exists a set of universally applicable ‘best’ human resource practices which if implemented in the workplace can lead to enhanced firm performance. This implies that a one-size-fits-all recipe must be inherent in best practice human resource management. This paper challenges this notion and opposes the existence of one …show more content…

Supporting arguments will be corroborated through empirical evidence and illustrative cases available on the system of ‘forced ranking’ a popular best practice performance appraisal scheme pioneered by Jack Welch CEO of General Electric in the 1980s (Pfeffer & Sutton 2006).

Forced ranking also known as the ‘stacking system’ is a performance rating system that has arguable attracted more attention over the years than any other (Smither & London 2009). While this practice has been widely used by well-known companies such as GE, Sun-Micro Systems and Hewlett-Packard (Grote 2005, cited in Smither & London 2009) it has also been the subject of significant controversy given its rejection by companies such as Xerox and PepsiCo (Olson & Davis 2003). Forced ranking is a performance rating approach synonymous with relative rating (Smither & London 2009). This implies that rather than being appraised independently against a uniform set of performance standards employees are ranked relative to peer performance and slotted into a normal distribution bell curve or a quartile distinction (Grote 2005). This would for example identify employees in the top and bottom 25 per cent (Grote 2005) and enable managers to identify the worst and best performing employees in an organisation. The use of forced ranking as a best practice people management scheme will be evaluated in the sections

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