Training Magazine - June 2008 - (Page 42)

I 42 f you’re familiar with the term, “forced ranking,” chances are you’re also familiar with the near-incessant controversy surrounding the performance-based comparative evaluation tool. Proponents of the system (see sidebar on p. 44 for typical metrics) often argue that forced ranking drives truth into the performance management process by fighting the rampant “grade inflation” inherent to more commonly used performance systems. Forced ranking also provides an excellent framework, they say, for identifying, rewarding, and retaining top performers and for improving the overall quality of an organization’s workforce. Those on the other side of the debate contend that forced ranking damages morale, creates a hypercompetitive environment that destroys teamwork, and creates a culture of fear that stifles creativity. They also argue that because forced ranking-related judgments are inherently subjective (at least according to some of the tool’s detractors), the system can create significant legal exposure for the companies that use it. The reality, however, is that the forced-ranking-related lawsuits aren’t any more common than other types of employment It is the legal exposure that companies interested in implementlawsuits, according to Sara Goldsmith Schwartz, an employment ing forced ranking tend to fear most. law attorney and managing partner at the law practice of And understandably so. In this decade alone, Ford Motor Co. Schwartz Hannum PC in Andover, MA. “Typically, suits associhas settled two class-action suits, paying out $10.5 million to ated with forced ranking are based on discrimination against a employees who alleged age discrimination associated with the protected class—by people alleging sexism, ageism, or racism. company’s forced ranking system (which it subsequently But forced ranking doesn’t necessarily cause more litigation…in shelved). Capital One, Goodyear Tire & Rubber Co., 3M fact, there are only a handful of publicized cases on forced rankCompany, Sprint, and a slew of other big-name companies also ing as opposed to hundreds of cases on age discrimination each have been taken to court in recent years by employees who year in general.” alleged that these companies’ ranking systems violated various So who’s to blame for all the fear-mongering? Mostly the media, says former General Electric executive Dick Grote, who is age discrimination prohibitions. now president of Grote Consulting Corporation in Frisco, TX, and specializes in helping organizations implement the tool effectively. “When a big-name company such as Microsoft is sued for discrimination tied to forced ranking, on what page of the paper does that news appear? Page 1. But when the judge throws out the case and says there is no way he will allow the suit to go forward based on the paltry evidence, where does that news appear? Page 38—right under the obits. The result is that we have hypersensitized organizations to the risks associated with what is a valuable management process.” Even Tom Osborne, a senior attorney of litigation at the Association for the Advancement of Retired Persons (AARP) in Washington, D.C., agrees that forced ranking as a performance system is not “inherently illegal”— despite the fact that he himself has battled corporate heavyweights as AARP co-counsel in the 3M, Capital One, and Ford forced-ranking-related age discrimina—Christine Amalfe, tion suits, the latter two of which were settled out of chair of the employment court. (The 3M case is still pending.) “There’s nothing law department at Gibbons P.C. wrong with getting rid of the bottom 10 percent,” he What’s at Stake? “Ranking systems have been the stepchildren in organizations for a long time. No one likes them. So you have to get people to accept and adopt the new performance system before you can train them on it. If they are simply told to do it, they won’t buy into it.” | JUNE 2008 t r a i n i n g w w w. t r a i n i n g m a g . c o m http://www.trainingmag.com

Table of Contents Feed for the Digital Edition of Training Magazine - June 2008

Training Magazine - June 2008 Contents Online TOC Editor’s Note Live & Online Training Today Soapbox How-To World View Changes With Penguins Keeping Forced Ranking Out of Court Across the Board Certify Me Meetings CPR How Secure Is Your Data? Training Leadership Summit Wrap-Up Tools of the Trade Inprint Questions for Covey

Training Magazine - June 2008

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