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Champion Leadership Blog

General Electric (GE) Stole My Idea About “The Performance Conversation”

So, last week General Electric announced it was doing away with its historic employee rating system.

For decades, at least since the early 1980s when Jack Welch was the CEO, GE had a strict five point rating system for employees.

It was nicknamed, “rank and yank.”

Reason being that at the end of this annual performance review process an employee rated in the bottom 10% of performers was fired.

Not only did GE announce the end of its five point rating system it is also eliminating the annual “performance review conversation.”

To read what GE is replacing their annual performance review with, click here to read more –

They are replacing it with more regular, on-going conversations.

Other companies like Accenture, Netflix and Adobe have been moving towards this type of system as well.

Five years ago I wrote a short white paper report titled, The 5 Master Keys to Effective Performance Conversations.

It spells out specific steps small businesses can implement to do what GE and these others are starting to do.

The basic premise is that instead of having annual “judgment day” where a manager provides an subjective and often arbitrary score on an annual review document offering little substance, managers and their direct reports can have on-going, regular conversations.

These conversations become two-way dialogues more like coaching, mentoring, support and problem-solving discussions.

GE is even implementing an APP to facilitate the tracking and monitoring of these on-going conversations that will provide substantive history for both sides to review when appropriate.

This approach is even more important in small businesses where relationships between levels of responsibility and authority are closer knit.

If you’d like to learn how to incorporate a similar system at your small business, feel free to grab a copy of The 5 Master Keys to Effective Performance Conversations at

If enough of you do I’ll create a webinar to take it to the next level of understanding for everyone.

’til next time, Communicate with Power,

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