SOLUTION: HRM 640 AU Online Rank Yank System Coaching Development & System Changes Discussion

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Part 1

Rank and Yank System

The traditional performance management appraisal system, known as ‘Rank and Yank’ was commonly used during the 19th to 20th century. Performance evaluations were forced into a curve that placed the majority, approximately 70% of the workforce, with some employees falling above and below the average scale in the mid-range. The term ‘Rank and Yank’ was originated in the railroad industry. Workers installed steel ties for long hours. Managers measured their output by ranking each employee against one another. Companies terminated employees with the lowest productivity. While this process standardized performance expectations, the system primarily addresses past performance and demoralizes underperformers. It can also create unnecessary and unwanted competition among team members as each employee looks out for themselves. According to Barry (2014), “a forced bell curve diminishes the value of the top performers and pushes many mid-level performers into the bottom.” High performing employees do not receive the appropriate rewards and recognition deserved, and average performers demotivated. Organizations have all the control and power over employees’ advancement, leaving little opportunity for employees to drive their success and career development. Overall, traditional performance appraisal systems are not sufficient for increasing productivity in today’s workforce.

Coaching and Development

Systems that promote regular check-ins with their managers encourage goal achievement, professional growth, and development. Employees prefer to work collaboratively with their managers to create goals and objectives that will drive business. According to Miller, “creativity gets turned off when employees are threatened, and most feel threatened by ratings.” Ongoing coaching and feedback bring out employees’ best work. Traditional systems discourage open dialogue between managers and employees, one dimensional. It lacks employee involvement and participation. “An ideal approach to performance management would be a system of structured feedback used to manage, regulate, and improve performance,” according to Lee (2006). Coaching creates the opportunity to discuss timely and vital issues, address challenges, and make course corrections as needed. While negative information is unavoidable, constructive feedback provides specific detailed examples of how to improve and tools and resources to adjust behavior and actions. Managers are often hesitant about conflict and providing direct and honest information. Their role is to remain positive, build relationships, not pass judgment. Coaching is supportive and guides employees towards positive outcomes. Ongoing coaching increases productivity and motivation for employees to succeed.

System Changes

Barry (2014) establishes that the performance management system is broken. She affirms that companies should create methods that “treat high performers very well while encouraging mid-level employees to improve through coaching and development.” Coaching goes beyond fixing problems and is used to develop succession plans and pipeline of high performing teams. A 2016 Conference Board survey (Gurchiek, 2016) shows that organizations are expanding their company’s coaching culture. By including coaching into their talent development programs, communicating the importance of coaching, and creating incentives and rewards for coaching efforts. These quality discussions help to align business priorities, empower employees to increase their autonomy, and build strong relationships. In today’s changing marketplace, “employees must take ownership of their performance and act on their own to improve their capabilities,” according to Barry (2014). The shift away from annual performance appraisals to continuous feedback and coaching will drive engagement and high performing teams. It is a less formal approach to performance management that focuses on forward progress, employee development, and future success. The focus is on simple, meaningful conversations driven by employees and supported by their managers through continued coaching.

Part 2

Good Evening Everyone!

Rank & Yank

This is the course of action organizations use when after ranking the staff they keep the top 20% of workers and the bottom end of workers are let go (Performance at work, n.d.). In other words, if an employee wants to keep their position with the company their performance needs to be exceptional to make sure they rank in the top percentile of their department.

Coaching & Development

By implementing this process, supervisors encourage and support their employees to guide them to successfully reach their career goals. They give feedback and lead their employees in directions to improve their performance in the workplace (Training Industry, n.d.). With this type of program and/or evaluation, employees can improve their performance and receive real-time feedback on their performance and their goals. As well as how to obtain those goals.

What’s the difference between Rank & Yank and Coaching & Development systems

Rank & Yank is more about locating the top performers and terminating the lower performers and hiring new staff. This can become costly and still not get the results in employee performance the company wants to maintain. This method is beneficial when a company has a large staff that is not necessary. By ranking everyone and discovering the top performers from the lower performers it is easier to find who and how many to terminate to lower staff levels to where they need to be (Boudreau, 2014, February 6). Barry (2014) states in the Deloitte Insights article that many companies acknowledge that their present performance review method is not working. That the ranking and grading system can diminish the value of top performers and pushes many mid-level performers to the bottom of the scale.

While coaching and development are more of taking the knowledge and skills the employees already possess and improving them through training programs and mentoring (maestro, 2019, January 3). This process will save more employees that need to just be motivated and more money is in the budget for rewards and incentives since there is less turnover. Also, coaching and development is addressed one on one and allows for a two-way conversation. Coaching and development encourage communication from both party’s thus permitting feedback to be received more easily. This method will also provide learning in an informal way and employees tend to remember better because it is more personal.

Part 3

There are many different systems to measure employee performance with advantages and disadvantages to each method. Whether the approach reviews behavior or results, most strategies are built on an annual review cycle; some consist of more frequent continual discussions. According to Aguinis (2013), “performance is about behavior or what employees do, not about what employees produce or the outcomes of their work.” The one performance situation not often addressed is measuring performance for a new employee. The usual measurement systems base feedback on past twelve-month experiences and career development for employees’ future career goals. These are not effective for new hires. A measurement that links behavior and results in the early stages of employment may not be relevant.

Based on my human resources experiences, the standard rankings and questions are problematic for newly hired employees. They are in the learning stages regarding their position responsibilities, company culture, and understanding what it takes to be successful in their role. Finnegan (2018) describes a stay interview as a “structured discussion a leader conducts with an individual employee to learn specific actions the leader can take to strengthen the employee’s engagement and retention with the organization.” As my organization faced increasing turnover, it was essential to develop a new set of measurements that engaged employees from their employment. We needed to determine critical success factors for employees to stay with the company. Finnegan (2020) stated that “stay interviews have helped our client companies cut turnover by 30 percent and more, all while also improving productivity, reducing errors and ultimately increasing profits”.

Stay interviews are different than traditional systems that measure goals and objectives. Stay interviews should focus on increasing employees’ engagement and retention, not primarily how to improve performance. The key is to obtain valuable information about their experiences, and learnings involve manager participation. They must ensure employees are pointed in the right direction with tools and resources. As relationships begin to develop, managers must deliver clear messages that relay the importance of the employees’ role in driving individual and company’s success. The performance appraisal is not a comparative model but leans more towards absolute. Aguinis (2013) “in absolute systems, supervisors, provide evaluations of an employee’s performance without making direct reference to other employees.” In my organization, the best practice is to discuss expectations at the sixty days formally. In the first thirty days, hands-on training takes place with the distribution of policies and procedures. As our data shows, ninety days is too long to course-correct, and employees may search for another position. The manager needs to provide detailed feedback regarding the employee’s performance in a simple essay format. The process is unstructured and gives input similar to a behavior checklist. Examples include:

  • What do you look forward to each day when you commute to work, which focuses on daily responsibilities and obstacles?
  • What are you learning here, and what do you want to know focus on skills to build and attain?
  • What can I do to make your job better for you for future career growth and longevity?

The ‘stay interview,’ a measurement utilized for newly hired employees, engages supervisors to ask, listen, act, and communicate honestly. They can strengthen relationships with their team members and can build trust, which increases engagement and retention.

Part 4

General Electric (GE) is an American multination energy company that was developed over 125 years ago (Building a world that works, n.d.). As the needs of the world continues to evolve GE has developed innovative ways for renewable energy sources (Building a world that works, n.d.). In addition, GE is also a major provider for aviation and healthcare materials (Building a world that works, n.d,). Since the beginning GE has been a victim of using traditional once a year performance evaluation system. With over 7,000 employees over 12 regions they knew it was vital that all employees were able to collaborate with each other to ensure customer needs are being satisfied while costs stay low however, traditional performance review made this impossible ( Baldassaree and Finken, 2015).

In 2016 GE began to implement a new method to ensure constant feedback, constant collaboration, and constant progress. Instead of using the traditional individual team method GE began to have one team to brainstorm ways to reach a specific production goal. During this time GE management can identify the strengths and weaknesses of individuals and of their team. To help with this process GE has also developed an app for their employees to use for employee recognition and corrective criticism. To me the app is a highly effective method because it allows everyone to see each other’s comments and respond to each other. It also keeps up with the advance in technology in today’s world. As a company continues to grow it is important that everyone in the organization grows as well otherwise they will be unable to meet consumer demands.

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