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Friday, October 07, 2005

The Vitality Curve

The vitality curve is a method of leadership aimed to produce a winning team. This concept is associated with Jack Welch who designed it as a 20-70-10 system where 20 percent of the work force ("top 20") work hard, 70 percent work ("the vital 70"), and 10 percent doesn't work ("bottom 10"). Managers who were placed in the bottom 10 percent were fired. This system may encourage managers to work harder, but it also has some difficulties. For instance, it becomes harder and harder to name the weakest players with the passing of time. Managers were fired annually. Probably it was easy to identify the weakest players during the first two or three years. However, as time goes on and on and the weakest players are already out of the game, chances are the good players will take the “weakest” positions. Those who do not deserve to be fired will be fired. To prevent this, managers will play every game in the book to avoid identifying their bottom 10. The vitality curve concept has many detractors. They think it's cruel or brutal to remove the bottom 10 percent of any company simply because their overall performance is not very productive. How about their families? How about their self-esteem? Well, there might be some people who deserve to be fired, but anyone can have a bad year. However, Jack Welch ignored the criticism and defended the layoffs of the weakest performers saying that “What I think is brutal and 'false kindness' is keeping people around who aren't going to grow and prosper. There's no cruelty like waiting and telling people late in their careers that they don't belong-just when their job options are limited and they're putting their children through college or paying off big mortgages." You know, he may be actually right. Nevertheless, I personally think that there are some people who always deserve a second chance. If they do not take advantage of that second chance, then let the vitality curve claim its victims.


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