1. What do you think are the pros and cons of using a forced-ranking system such as Siebel’s?
2. Does it make any difference that Siebel develops and sells performance management software?
3. If you were the owner-CEO of Siebel’s, would it change your view on forced ranking?

Siebel Systems, a U.S.-based developer of customer and employee management software, has built its forced-ranking system on the back of corporate objectives that cascade down from the top of the company. On the first day of each quarter, chairman and CEO Tom Siebel publishes his corporate objectives, generated from an off-site executive meeting. By day 3, senior managers will have reviewed the objectives and created their own targets for their specific divisions. By day 15, all 8,000 employees of the company will have created their own sets of objectives in conjunction with their managers. According to Anthony Deighton, director of Siebel Employee Relationship Management (ERM), these objectives are reviewed on a frequent basis through the quarter at both an individual and team level.