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Stack-ranking vs rewards programs [VIDEO]

There's been quite a bit of buzz lately in the business world about Microsoft's recent decision to scrap its stack-ranking system of employee reviews.

There's been quite a bit of buzz lately in the business world about Microsoft's recent decision to scrap its stack-ranking system of employee reviews.

With a stack-ranking system, every manager must rank a certain percentage of their employees in four performance categories – top, good, average and poor. However, this system leaves a lot of room for error since it basically ranks workers on a curve and often pits employees against each other for a top spot.

And the system really leaves no room for individual accomplishments like a points-based reward program that recognizes and customizes awards for employees based on achievements.

By doing away with the stack-ranking system, it appears as if Microsoft "gets it" too.

Senior executives must understand that workers are motivated when they are rewarded for doing good work. A points-based rewards program is one way companies can do just that.

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