BlueSky Thinking Summary

The article explores the pros and cons of relative versus absolute performance metrics in employee evaluation.

As George Georgiadis, a strategy professor at Kellogg School, comments, methods of evaluation have to be aligned with the objectives of the company in order to ensure somehow both motivation and performance.

Relative metrics- those that compare employees to one another- have been praised for being easy and inexpensive but also denounced for the competitive environment that can hinder cooperation and morale.

On the other hand, absolute metrics promote accountability and teamwork at the individual level but are much more complex, being subjective criteria applied in their implementation.

Georgiadis makes a case for a blended perspective that properly balances between competition and cooperation.

He underlines the fact that incentive structures should be tailored to organizational goals and chiefs: leaders designing performance evaluations that drive individual motivation but foster support at work.

How will your company use these findings to improve performance and collaboration?