How stack ranking ruined Microsoft, and it’s Ballmer’s fault

When I first read about stack ranking, I thought it was one of the stupidest fucking things I’d ever heard of. It actively dissuades talented people to work alongside one another, and, in fact, encourages people to surround themselves with the most mediocre idiots they can. Hopefully this one of many things the next Microsoft CEO will change when he or she cleans house.



  • dr.no

    only the bottom 10% get sacrificed. So one person from each group every year.

    Plus you have waste time doing evaluations on all you team members.

    But some of the largest corporations have stack ranking like GE, P&G.

    • alextheukrainian

      Yeah, and look at all the amazing innovation coming out of those companies… Many big companies are doing many stupid things; it doesn’t make those things smart, it makes us not know what those companies could really be had they not done those things.

  • Moeskido

    Sales culture doesn’t always translate well to operations that shouldn’t run on internal competition. But people who spend their careers within that culture aren’t necessarily the best judges of how anything works outside it.

  • Sigivald

    When I heard about that ages ago my immediate reaction was that I’d never want to work at a company where N% of every group had to be ranked “best” and M% had to be “worst” and punished or fired if they didn’t “improve”.

    Yeah, it means you can’t have “everyone being above average!”, but that’s irrelevant – you’re not hiring a random sample, you’re trying to hire very competent people. If you’re doing a good job, most of them can be better than the industry average.

    In a really awesome environment, it might well be that everyone on the team is very, very good … but you still need to pick one of them, kill their bonuses, and then maybe fire them? Because the policy says “N% on the top, M% on the bottom”?

    Nothing good can come of that, for either morale or productivity.

    What could they possibly have been thinking?

    Maybe Moe’s right and it’s a sales thing and that might make sense in a high-pressure, high-churn, low-loyalty salesman-hive environment

    But for software development? Madness.

    • Moeskido

      Precisely. Here’s the problem. Assume a notional workgroup of techs, craftspeople, or creatives — which requires cooperation and collaboration in order to turn out good work that often requires attention from several hands — that’s somehow composed of workers who are all more or less equivalent in talent because of an awesome HR department’s screening and a picky manager’s rigorous requirements.

      What happens with stack ranking in that group becomes a form of reverse Darwinism, where the most potentially obnoxious and sociopathic individual will learn to do anything he can to eclipse or denigrate colleagues in order to make himself look better at the end of the quarter. The larger the staff, the more likely it’ll happen, as sure as leaving rotting meat out on a plate will draw flies.

      Raises, bonuses, or simply remaining employed are all remarkable incentives for making destructive behavior part of a 21st-century personal work ethic. Too bad about the really smart but quiet guy in your group who did great work but wasn’t as demonstrative with the boss, or cynical enough to make sure his work hadn’t been tampered with before a presentation.

      Like the wretched notion of having “internal clients” instead of colleagues or collaborators, this toxic idea carries all the piss stains of having been spawned in business schools, gestated by sales jocks, and shat out all over companies like Microsoft by people who believe every situation is about dominance, even within your own team.

  • Tvaddic

    Microsoft wasn’t failing, it just wasn’t advancing as rapidly as Apple or Google, MS was apart of any other industry no one would have a problem. If someone came in and did nothing for a year they would be applauded.

    • Moeskido

      RIM wasn’t failing in 2008, either. Just not advancing as rapidly.

      • Tvaddic

        RIM was also a one trick pony, who was smaller than Microsoft, that doesn’t have as many resources and not as much cash in the bank.

        • Moeskido

          Granted, Windows and Office constitute a two-trick pony. So it might take longer to see the failure. It’ll happen.

          • Tvaddic

            In addition to XBox and their enterprise solutions.

  • marv08

    The only things you can measure people (in positions / functions like these) against are clear and achievable targets. If a whole department and 80% of the staff in it do not achieve their targets, firing the 10% “ranked” worst won’t help (other than maybe properly hiding the fact that the department is either badly managed, or that the goals specified were nuts in the first place). If a department meets all its goals or even exceeds them, firing 10% and rewarding 10% is even more insane.

  • Kriztyan

    How sad that instead of incentivize good talented people to collaborate, you achieve exactly the opposite. This is very Ballmeresk indeed.

  • LJ

    It’s not just destructive but also very wasteful. Imagine taking every manager in the world away from their normal duties for two weeks twice a year so that they can rank their staff according to a strict percentage that rewards a certain percentage of people and punishes a certain number of people by quota, regardless of their actual value.

    The process should be called “Crack Ranking” because the only people who this could possibly make sense to are probably under the influence of something illegal.