I hate the vitality curve concept. You can build a team of high achievers. Great people. Smart, energetic, dedicated people. Wonderful team. Guess what? 10% of your team is required to be designated as LOSERS who need to be fired and replaced. Every year.
The article said Welch only applied it to managers to cut bureaucracy. Other than that, I hate it, too.
“I hate the vitality curve concept.”
Same here, and I see it within my own Dept. You have a team that excels as a team. But if you artificially take a razor blade to them as individuals and rank them by minutia, you’ll have a bottom 10%. They are still excellent individuals and fully contribute to the team. It’s counter productive.
100% agree... I worked under that system at Dow and at another company later. It's OK if you have a TON of people in your rating group... (like, 100 or more) but, even then, 10% FORCED turnover is stupid, expensive, and counterproductive.
It's especially devastating when you try to apply it to a group as small as 20, or less... which, the brainiacs running Dow attempted to do.
I was involved in a joint venture with GE in the Welch era and one of the first things I learned from the GE managers was “there is always a bottom 10%”.
We bought his book and read it!