Can a bad human resource management system bring down a company? We take a look at some of the human resource management systems with a bad reputation.
«Once upon a time there was a girl with an enormous talent for accomplishing her tasks, alias Cinderella, whom one day the top manager, alias the prince, discovers at a ball. Unaware of her identity, he uses a glass slipper to find her».»
With this adaptation of the popular Cinderella story, Rocio Cervantes, human resources consultant and co-founder of HRLab.co.uk, uses the metaphor of the glass slipper to refer to the different systems for identifying talent. Human resources managers yearn for a system like the shoe in the fairy tale, capable of magically identifying who is the right person for the job in question.
One of the most controversial performance appraisal systems in recent times has been that of Gaussian bell, ‘vitality curve’ or ‘forced ranking’.
For example; General Electric, one of the pioneers, used a 20-70-10 ratio. The 20% at the top of the table – the best employees – received bonuses and promotions. Those in the middle stayed the same. And the bottom 10% were demoted or fired.
At the end of August 2013, Steve Ballmer, CEO and co-founder of Microsoft, resigned from his post and announced that he would be leaving the position within the next twelve months. This farewell only fuelled criticism of the bell curve, as it appears to have been “the management method that has led Microsoft to failure”.
This type of performance appraisal system creates a bad working environment, as employees sabotage each other to prevent others from achieving better results than themselves. They compete with colleagues, rather than with the market.
Cervantes explains that “bad practices in human resources mainly occur at management level”. And he points to those companies that have very well-developed HR policies, “but which are not fully implemented as they were initially designed”. Why?
1.The HR function does not support sufficiently to leaders in their role as people managers, providing them with the tools they need to identify, develop, and evaluate the talent within their teams.
2. Leaders do not use the tools available to them correctly and continue to rely on discretion (who am I going to promote this year, who am I going to give a bigger bonus to, etc.).
