By Liu Shinan (China Daily)
Updated: 2007-12-12 07:41

As year draws to an end, employees in many, if not all, work units begin to get nervous. Companies and government organizations start to sack employees graded last in their work performance assessments. The policy is commonly known as "eliminating the last-graded (ELG)".

This method of employee management originated in Western countries and was introduced to China in mid-1990s. Under this system, all employees are graded from excellent to very poor in a comprehensive assessment of their work performance. Those at the tail end are fired.

Ever since its introduction, the practice has been blamed for being "inhuman" in terms of labor-management relations because it places all employees in constant fear of being surpassed by co-workers. Managers, however, favor the system because they claim it stimulates employees to keep improving in their work.

Controversy aside, the system is not rational, and does not result in the effective management of human resources.

First, the system is illogical.

It determines an employee's qualification by comparing his/her performance with that of others rather than gauging the performance against certain standards. In evaluating performance, some standards must have been adopted, hence the different marks every employee is given. It is highly probable that all employees measure up to the standards though there are differences.

The ELG system, however, eliminates those who rank last in disregard to their having met the standards. This means that no matter how hard one works, one cannot avoid being eliminated if others have done better.

Second, no method of evaluation is absolutely objective. Many subjective factors interfere in an assessment and conditions are usually too complicated for rules to be applied without discrimination.

For instance, a person who is more enthusiastic and responsible about work tends to undertake more work or insists on co-workers abiding by the standards, hence there are more chances of making mistakes and inviting jealous resentment.

Third, as ELG is conducted on the basis of individual departments, it is highly likely that one who ranks last in one department outperforms many others who work in another. Then, is it fair to fire this person simply because he ranks last in a better-performing department?

ELG derives from the so-called quantized management, which applies mathematical models to all links in the process of management and translates the assessment of all aspects of work performance into digits. Quantized management makes final evaluation easier and more objective. It is based on a comprehensive, scientifically structured system and meticulous observation of every detail of the rules and standards.

Scientific management is a good thing but it also imposes higher requirements on managers. To ensure more reasonable and effective management, especially of human resources, managers should improve their abilities and work harder rather than rely on a sluggard's magic formulae, such as ELG.

Otherwise, they will be eventually eliminated themselves.

Email: liushinan@chinadaily.com.cn

(China Daily 12/12/2007 page10)