Dive Brief:

• Some former Facebook employees described the social media company as a "cult-like" work environment, according to a new report from CNBC. According to those who spoke out, workers are pressured to befriend colleagues in order to advance and dissent isn't tolerated.
• Many former employees blamed the lock-step, cult-like environment partly on Facebook's "stack rank" performance review system, whereby mandatory biannual reviews subjectively and anonymously rate employees so that the favored ones are destined to advance. Some employees receive good rankings that put them in good standing, while others get mediocre to poor reviews and are eventually shown the door. Senior managers have the ultimate say on employees' fate, and the careers of those who openly criticize the company or reject the culture are cut short, said CNBC, reporting ex-workers' comments. Stack ranking has been a common practice in Silicon Valley companies.
• A Facebook spokesperson denied that employees are forced to socialize, but that collaboration is important at the company. Facebook regularly earns high marks as a "best place to work" on sites like Glassdoor, even as it faced numerous criticisms in the media, but it slipped from first place in the site's latest report.

Dive Insight:

Employers with stack ranking performance review systems, also called "rank and yank" reviews, basically get rid of the lowest-performing workers in favor of those seen as having the greatest chances for success. But even GE — the progenitor of such a system — dropped the program in 2016 in favor of an increased frequency feedback model. Amazon and Uber, two companies that have been previously criticized by employees for their cultures, also dropped their stack ranking review processes in 2016 and 2017, respectively.  

Alexandra Michel, University of Pennsylvania professor who studies work culture, told CNBC that stack ranking performance systems work well in competitive work environments that rank employees using objective criteria. "If you have an environment that is completely cutthroat like Wall Street, this system works pretty well," said Michel. "But if you have employees who come in and want to be taken care of, want to learn, want to be part of a warm group and people who care about them — that's a very jarring mismatch." 

For this reason, the annual or biannual review has fallen out of favor, replaced instead with feedback given quarterly or even monthly in order to make conversations between managers and employees forward-looking and development-oriented rather than completely reflective on past behavior. Companies who cultivate a positive external reputation, culture or brand, while allowing a restrictive work atmosphere to thrive could jeopardize their employees' engagement and overall well-being due to that disconnect.