Microsoft Changes Its Ways

One of Microsoft's (NASDAQ: MSFT  ) most controversial corporate practices has always been its stack-ranking performance review system, where a predetermined portion of employees would be classified into different categories relative to peers. That meant some were destined to be considered underperformers, even if they were still doing fine in absolute terms.

Many former employees, including some high-level execs, have called the system incredibly destructive, since it fosters too much internal competition. Instead, employees should be encouraged to collaborate in order to promote innovation, which is an area where Microsoft has lagged in recent years.

Incidentally, Apple  (NASDAQ: AAPL  ) made its own move toward greater collaboration last year, after Tim Cook shook up the management team. Apple had historically been very departmentalized, and Cook felt that may be holding back Apple's ability to integrate hardware, software, and services. The highest-profile casualty there was Scott Forstall, who stepped down as iOS chief. Meanwhile, Yahoo! has reportedly adopted the controversial system.

Ford's Alan Mulally has been named as a front-runner for Microsoft's next CEO. As Mulally isn't a tech visionary, this underscores the importance of having employees collaborate and innovate, since Microsoft's next big idea may not come from the top.

In this segment of Tech Teardown, Erin Kennedy discusses the details of Microsoft's policy change with Evan Niu, CFA, our tech and telecom bureau chief. 

Got iPad?
The new iPad Mini Retina might be hard to come by this quarter, given all the reports of supply constraints. Well, we're going to be sure to get a few -- and give them away! That's right: For the first time ever, The Motley Fool is hosting a contest where you can win a free iPad Mini Retina. All you have to do is tell us why you love The Motley Fool by clicking here! We'll pick the three most Foolish submissions to receive a free iPad Mini with Retina display.

See full terms and conditions by clicking here

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 2725274, ~/Articles/ArticleHandler.aspx, 9/27/2016 8:15:35 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated 10 hours ago Sponsored by:
DOW 18,094.83 -166.62 -0.91%
S&P 500 2,146.10 -18.59 -0.86%
NASD 5,257.49 -48.26 -0.91%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

9/26/2016 4:00 PM
MSFT $56.90 Down -0.53 -0.92%
Microsoft CAPS Rating: ****
AAPL $112.88 Up +0.17 +0.15%
Apple CAPS Rating: ****