Adobe Stock price

According to a rece3nt article in Forbes, Adobe discontinued is practice
of "stack ranking," (a system that requires managers to fire their worst
people every year. The article proposes that this change in its employee
management practices could be a cause of the stock increase. Is it
possible that Microsoft believes this too. The article makes for a good
read, and intimates that conversion to the subscription model may not be
the cause of its stock increase. I freely confess that I don't know the
answer.


<http://www.forbes.com/sites/peterco...dumped-stack-ranking-will-microsofts-follow/>

 

: According to a rece3nt article in Forbes, Adobe discontinued is practice
: of "stack ranking," (a system that requires managers to fire their worst
: people every year. The article proposes that this change in its employee
: management practices could be a cause of the stock increase. Is it
: possible that Microsoft believes this too. The article makes for a good
: read, and intimates that conversion to the subscription model may not be
: the cause of its stock increase. I freely confess that I don't know the
: answer.
:
:
: <http://www.forbes.com/sites/peterco...dumped-stack-ranking-will-microsofts-follow/>

The premise that the abolition of stack ranking would drive a company's stock
price up, rather than down, is counterintuitive, is it not?

Bob

 

At 60 mph I would tend to agree. There has to be some method to keep
employee performance at a high level, and terminate the underachievers.
A business is not a kindergarten. What is being done is to replace
annual reviews with continuing reviews and goal setting. According to a
friend of mine, who is a in a company owned by a private equity company,
employee stacking created an atmosphere of fear and uncertainty as
annual evaluation time came around. Employee real production actually
dropped as creativity went out the window and they started to literally
follow the inane work rules that most companies have. When this company
dropped employee stacking, year round creativity and profits increased.
The rote managers and paper shufflers were terminated. I am not expert
enough in HR to state with certainty that employee stacking should be
dropped. But, there appears to be a strong case that: employee stacking
is not suitable for all companies; and using a different method of
employee evaluation helps to increase the bottom line.