The following quote is based on statements made by quality expert W. Edwards Deming:
"If by bad management the components of a company become competitive, the system is destroyed.....A common example lies in the practice of ranking people, divisions, teams, comparing them, with reward at the top and punishment at the bottom. Jobs and salaries are based on comparisons. Teams naturally become competitive; divisions become competitive. Each tries to outdo the other in some competitive measure. The result is higher costs, battle of market share. Everybody loses."
Do you agree with Deming that performance evaluation based on comparative rankings always reduces company value?
I don't think so that performance evaluation based comparative rankings always reduces company value. The reason for this thinking is that it all depends on the management how it conveys its employees about the relative importance of comparative rankings ...
Performance evaluation based on comparative rankings always reduces company value