Michael Phelps and the GE "vitality curve"
Jack Welch of General Electric fame made famous a simple formula for creating high performance teams. His approach was simple: 20% are top performers, 70% are average performers and 10% "can't get the job done." This was translated into 20% get hefty raises, 70% get a solid raise and 10% get nothing or get fired.
I have worked under this scenario several times and have always found it to be lacking. In some situations it can be useful and justify decisions. In others, where companies blindly follow it and hold to it as if it is the guiding light to nirvana, I find it to be hollow and vacant of good judgment at best.
Consider the Olympics and the demanding requirements of competing on a world-class level. Hours and hours of practice, discipline and flawless execution. The 4x100 relay that was won by the Americans in world-record time becomes my reference point for persuading you that the 20/70/10 rule from Jack Welch and GE is only as good as your own good judgment dictates.
Michael Phelps has thus far won five gold medals. He is attempting to win eight in a single Olympic games. On the 4x100 relay team he swam the lead-off leg, while Jason Lezak swam the anchor. Lezak come from behind and impressively "won" the gold medal that Phelps needed. However, I find it very noteworthy that a total of five teams beat the previous world record time in this single race. World class performances for every one of them... and yet only three teams received medals. This proves the point - Jack Welch and GE are right. All other teams failed, didn't get the job done and received no reward. Well sort of...
Let's apply the rule to the four swimmer's on the American team. Which one of the four should be fired? Which one didn't get the job done? Which one gets no reward? Which one had such a poor performance that he should get nothing or get replaced?
The 4x100 relay is a team event. It requires the best effort and performance of all four... and yet, at times one swimmer may swim an individual leg faster than another. In another event, a different swimmer may have the fastest leg. The noteworthy situation - from Jason Lezak, the same swimmer who swam on the previous two losing American Olympic efforts in the 4x100, is quoted as saying, "I just got tired of losing". This is a competitor who dug down in the last ten meters and won a gold medal for himself, his friend Michael Phelps and the entire American team because, "I just got tired of losing."
The next time you feel compelled to give no reward or fire the bottom 10%, think about the 4x100 and ask yourself, "do I have a world class team?". And if you do, reward the entire team and ignore the 20/70/10 rule from Jack Welch and General Electric. It's just another tool that requires your good judgment. It does not guarantee a world class team or even the "best team on the street."
www.iangilyeat.com
I have worked under this scenario several times and have always found it to be lacking. In some situations it can be useful and justify decisions. In others, where companies blindly follow it and hold to it as if it is the guiding light to nirvana, I find it to be hollow and vacant of good judgment at best.
Consider the Olympics and the demanding requirements of competing on a world-class level. Hours and hours of practice, discipline and flawless execution. The 4x100 relay that was won by the Americans in world-record time becomes my reference point for persuading you that the 20/70/10 rule from Jack Welch and GE is only as good as your own good judgment dictates.
Michael Phelps has thus far won five gold medals. He is attempting to win eight in a single Olympic games. On the 4x100 relay team he swam the lead-off leg, while Jason Lezak swam the anchor. Lezak come from behind and impressively "won" the gold medal that Phelps needed. However, I find it very noteworthy that a total of five teams beat the previous world record time in this single race. World class performances for every one of them... and yet only three teams received medals. This proves the point - Jack Welch and GE are right. All other teams failed, didn't get the job done and received no reward. Well sort of...
Let's apply the rule to the four swimmer's on the American team. Which one of the four should be fired? Which one didn't get the job done? Which one gets no reward? Which one had such a poor performance that he should get nothing or get replaced?
The 4x100 relay is a team event. It requires the best effort and performance of all four... and yet, at times one swimmer may swim an individual leg faster than another. In another event, a different swimmer may have the fastest leg. The noteworthy situation - from Jason Lezak, the same swimmer who swam on the previous two losing American Olympic efforts in the 4x100, is quoted as saying, "I just got tired of losing". This is a competitor who dug down in the last ten meters and won a gold medal for himself, his friend Michael Phelps and the entire American team because, "I just got tired of losing."
The next time you feel compelled to give no reward or fire the bottom 10%, think about the 4x100 and ask yourself, "do I have a world class team?". And if you do, reward the entire team and ignore the 20/70/10 rule from Jack Welch and General Electric. It's just another tool that requires your good judgment. It does not guarantee a world class team or even the "best team on the street."
www.iangilyeat.com
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