The Friday Facepalm: business news for Nov. 15, 2013

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WTF is wrong with these people? (I’m looking at you Kellogg’s, JP Morgan and especially Yahoo!)

Do you ever wonder what goes through the minds of those charged with making important decisions for big companies? Other than a stiff breeze, I mean. Let’s start with a fun one.

But if you don’t retweet, it’s okay. We’ll just let them die.

[sigh]

Then there was this little miscalculation by the good folks at JP Morgan. Let’s have a Twitter Q&A where people can get to know one of our bigwigs a little better. You know, because kids love the Tweeters. Of course, this happened.

And this.

And this.

And these.

There’s so much I could add here, and absolutely none of it is necessary.

Finally, Yahoo! has stepped in it. Unfortunately, the “it” here is something that’s been stepped in before and you’d think they’d have learned from the mistakes of others.

You may have heard the story about the company some years back that instituted a new policy. Each year it was going to fire the bottom 10% of performers in each department. If you’re a certain type of, ummm, thinker, this might look like a good idea. Get rid of the deadwood!

Hold that thought. While there’s a good bit of finger-pointing and he-said-she-saiding going on, it appears that Yahoo! CEO Marissa Meyer issued an edict that was interpreted as a command to implement the Bell Curve and assign some Fs, no matter what.

At question is the “Quarterly Performance Review,” which “forces managers to rank some of their staff with designations of ‘Occasionally Misses’ and ‘Misses,’ even if it is not the case, via what is essentially a modified bell curve.” Managers felt they had to give failing grades to employees who were performing adequately or above.

Mayer reportedly denied it in an internal meeting, and told her staff that the process wasn’t being deployed correctly. All Things D says that this post came in to the message board while Meyer was still talking:

It is 100% true that managers are told they need to put someone in occasionally misses to meet the distribution. It is not a cop out, as you mention. We are told, very clearly, that we have to rank someone low. So, forced ranking is in place, regardless of what Marissa thinks is happening. Maybe it’s not supposed to happen — but Marissa needs to make this very clear to upper management before they have us force rank next time.

Former GE CEO Jack Welch is famous for promoting this philosophy – called, among other things, the “vitality curve” – and other companies have used it in recently years. It is sometimes credited with driving success, although there are critiques that suggest it can be counterproductive. (And I suspect that a lot of those attributing success to it are fanboys motivated more by ideology than hard examination of the facts. I could be wrong, but it wouldn’t the first time data had been filtered through the lens of dogma.)

I have a former colleague who’s familiar with a case where the vitality curve was implemented in a very large financial services corporation. It wasn’t long, he said, before it was quickly disimplemented. There were two big issues. First while there are underachievers in a lot of departments in just about every large company, there are also groups that are stocked to the gills with really good people. As in, the worst guy in the department would be a top 10% performer in any other company in the industry. But this policy made no allowances for that and thus set about firing a lot of extremely talented folks. One assumes that it wasn’t long before the competition got a little better.

The second problem was an HR issue. It turned out that in this company the attack on the bottom 10% was hitting minority groups disproportionality. While it isn’t true that minorities are the laggards in all companies, or even most of them, it was the case for this one, and you can imagine the Chief HR Officer wetting him/herself when data hit the desk indicating that the corporation was systematically turfing a protected class.

A lot of people know about these cases and spout them as though this is how things ought to by god be done. I was employed by such a business not so many years ago. They brought in a consultant a few days after a round of layoffs to tell us all how lucky we still were to have jobs. He, being more enamored of big ideas than he was facts, brought the fire-the-bottom-10% case to bear in illustrating how much tougher it really could be out there.

If any of those geniuses are reading, you now have, as Paul Harvey would have said, the rest of the story.

Expect a sharp reversal in course from Yahoo! in the coming days.

Have a nice Friday, and enjoy your weekend.

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