That's about the only time I can think of where it makes sense. If you have to lay off some people, then obviously you want to get rid of the lowest performers.
But if times are good and everyone is performing well enough and contributing, why get rid of them? If they're not performing well enough, then you shouldn't need stack ranking to figure that out, and you don't need to arbitrarily set a percentage of employees to put on performance improvement plans or fire.
But if times are good and everyone is performing well enough and contributing, why get rid of them? If they're not performing well enough, then you shouldn't need stack ranking to figure that out, and you don't need to arbitrarily set a percentage of employees to put on performance improvement plans or fire.