Jack Welch at General Electric instituted the Vitality Curve. Describe the Vitality curve and its pros and cons. Who were the proponents of the Vitality Curve? Do you believe that it is good for and institution? Why or why not? What would it do for employee morale? Would you use the Vitality Curve as a CEO of a large corporation?

 

Vitality Curve

Jack Welch’s vitality curve refers to a performance construct where the workforce is graded based on an employee’s productivity. It is an annual process that enables the management to assess each employee’s contribution to the organization’s success (Zhihua, 2019). For example, in General Electric, employees whose performance is below 10% are fired.  The top 20 are considered the most productive, and 70% work satisfactorily.

Vitality Curve can stimulate an employee’s abilities through the competitive elimination process. As a result, it is easy to identify top performers for people development initiatives by the management. Also, the management can improve productivity and profitability as highly efficient get rewards for exemplary contribution. At the same time, managers can reflect upon their behavior in terms of qualification and experiences that make them effective at work.

However, the vitality curve approach encourages sabotage as professionals charged with hiring others may avoid the best candidates as adding more competent employees increases their risk of survival in the organization. Also, the vitality curve approach exacerbates morale issues among employees who worked considerably hard and obtained low scores felt their contribution is negligible. In most cases, employees understand that they can either thrive or die, which may be debilitating in some situations, making them lose interest (Zhihua, 2019). Also, morale may occur when employee feel the grading system is bias and does not reflect their contribution.

In light of these challenges associated with the vitality curve approach to managing operations, it is good for an institution. An institution thrives on continuous improvement of processes, so imposing a strict performance management system might obliterate growth, especially among young professionals seeking to advance their competence. As a CEO of a large corporation, I would not use the vitality curve for management decisions due to associated effects on employee morale and the likelihood of sabotage.