20-70-10 vs. a-B-C

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  • Topic: Vitality curve, Jack Welch, Cellular differentiation
  • Pages : 3 (851 words )
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  • Published : July 29, 2012
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20 – 70 – 10 vs. A – B – C
Week 4 Assignment 1

Discuss the strengths, pitfalls, and underlying assumptions of differentiating employees in the manner suggested in Jack Welch’s 20-70-10 framework. Jack Welch has created a framework for managing his talent, something that is also referred to as a vitality curve. Jack’s is broken up into three separate categories, 20% that consists of the top performers in an organization, 70% that consists of average performers but makes up the most of any organization, and the bottom 10% which consists of the poor performers. In Jack’s model he notes the top 20% should receive bonuses and promotions to keep them enticed to stay. Jack also recommends the bottom 10% should be truncated, as these individuals typically are economically unfriendly to the organization and do little to support the organization. In other words, they are the “weak links.” There are a few strengths in a framework like this that I see to be most important to point out. First, this creates an environment where it is very clear of the consequences of falling to the 10% area and the benefits for moving into the 20% area. This environment encourages employees to always be on their toes providing the best work to their ability. If you’re a company greater than 50 employees, it will make setting these ground rules much easier as you can generalize across the board rather than focusing on a specific player or position. However, like anything else, this framework does not come without pitfalls. By ranking an employee into that bottom 10%, it makes them less visible as they are in the “firing zone.” Who is to say, your HR team didn’t put the employee in the incorrect department? However, now that they are in the 10% zone, it will make the move from department to department even harder because now they are stereotyped as a poor performer. Today, we live in a dog-eat-dog world where you are rarely safe unless you control everything. This framework boosts the...
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