These types of forced ranking systems are very tough. Microsoft has had a lot of complaints about there's. GE, on the other hand, has had success with theirs. I've seen them work successfully at large firms where they were ingrained, and the companies had other cultural norms to increase teamwork. I've seen it flop at a few software firms.

What they're good for:

- Forcing managers to make hard decisions and give real feedback. (You can't just tell everyone "You're doing fine.")

- Highlighting who at the bottom should be let go, and who a level below should replace them. (In most firms, the top 10% at a given level outperforms the bottom 10% at the level above them)

- Providing internal guidance for larger layoffs.

- Encouraging constant trimming to avoid those larger layoffs.

The problems of these systems are numerous though:

- It can discourage teams of superstars from working together on large projects. "What if only 1 or 2 out of us can be ranked high?"

- It can encourage selfish behavior and infighting if there aren't other counterbalancing forces.

- There is frequently disagreement for anyone not in the chosen group.

- Much of the differentiation is based on managers ability to fight for their employees, rather than employees actual ability.

It will be interesting to see how this plays out. In Marissa's defense, she wasn't hired to continue "Business as usual".