In the knowledge economy, it’s often the aim of any organisation to have the smartest people at its disposal, whether directly via paid employment, or indirectly via mechanisms such as open innovation.  This desire to have the best players in your team has seen the rise of tools such as stack ranking, which see organisations ranking employees in a bid to gradually shift employees up the talent scale.

A study published recently in the American Economic Journal suggests this may backfire however.  The study looks at what happens to the rest of the group that is dominated by the so called best and brightest.  Do they help and encourage the laggards to improve?  Well, it seems not.

“This paper is part of a growing body of literature suggesting that just because you have stronger peers doesn’t necessarily mean you are going to perform better,” says Scott Imberman, associate professor of economics and education at Michigan State University.

The study focused on a school environment, and in particular the numerous gifted and talented programs in operation around the United States.  Over 14,000 students were selected who had just about squeezed into the program, with the aim being to see if these students improved in the presence of those who had qualified rather more comfortably.

Sadly, it emerged that not only did they not really improve, they showed no more improvement than students who hadn’t qualified for the program at all, and this lack of progress was across all of the five subjects studied in the research.

So having gifted people in the group did little to lift the performance of the more average performers in it.  Now it should be said, that in a class environment there is no requirement of students to coach and encourage their peers, but that might be the case in the workplace.

Another study highlights the difficulties inherent in this however.  It looked at how powerful people tend to look upon their less powerful peers, and found that they often dehumanise them.  They found that in such an environment, those in positions of power would choose the most effective strategy, seemingly oblivious of the human consequences.  All of which may go some way to explaining the popularity of stack ranking in the first place, but does little to help raise the game of those not a part of the super talented elite.