New Management System: Value Above Replacement (VAR)

Looking at Businessweek's recent article about Yahoo ranking its workforce by the bell curve system (aka the stack system), it is clear that such a system is a plague to worker productivity (and ultimately shareholder value). You can read about the stack management system here, so I won't get into the details of the system, but I will list some of its pitfalls:

• Subjectivity. This may pose the biggest threat to the system. Managers tend to play "favorites" to those who brownnose and rankings are leased less on actual worker productivity. Employees then play the politics game where ultimately it is less about doing actual work and more about gaming the system.
• Quoted from one of the article comments: "People planned their days and years around the review, rather than around products. You really had to focus on the six-month performance, rather than on doing what was right for the company.”
• Power struggle. Management tends to have a "my way or the highway" approach which stifles the best employees. They also tend to take credit for wins while deflecting responsibility for losses.

I can only imagine what some of those who don't deserve to fired thought when they got canned:

Those are just a few problems, but you get the point. Most importantly, it is not based on an objective system. It is simply unfair to the workforce and ultimately is not the optimal way to be productive. Take subjectivity out and the system could actually work. This is where my idea comes into play.

Value Above Replacement is based from baseballs sabermetric stat Wins Above Replacement (WAR). WAR takes a collective measure of a baseball players productivity. It includes all types of (advanced) stats and metrics that collectively determines a players value to a team relative to a nonexistent"replacement" level person. This "replacement" player has a benchmark of zero. If an actual player has a positive WAR, they are viewed as an asset. If negative WAR, they are obviously a liability.

In a workforce setting, imagine setting an "average" measure of productivity and using data of each individual to determine whether they are an asset or liability to a company relative to this average. If this goes up to the chain to the CEO, the CEO can have access to all workers and their stats at a moments notice and base their decisions on such metrics. I have not been in a Yahoo type workplace setting, so I am not sure exactly what type of stats and metrics that would go into the equation, but if I got a feel such a system I could definitely provide further input regarding this. As an outsider, I can only speculate. All I know is that it needs to be a collective measure of productivity for both workers and managers. It is a simple (enough) system where all individuals would have access to their VAR and could see exactly where they struggle and where they prosper. It seems like a win-win situation from an outside perspective.

No one has to play politics. There is no uncertainty in where a manager would rank you. "Quarterly results" are abolished. Even managers would be held accountable for their actions. All the employees have to do is focus on the job at hand and create great products.