bad hire doesn't necessarily mean bad/stupid/incompetent person, it just means bad hire. might not be a fit for the role, might not be a fit for the company. for example, i freely admit i was a bad hire at Google because i got demotivated by big corporate/political bullshit getting in my way, it just wasn't for me. then i went to a 20 startup and, in the words of the CEO, "saved the company" and scaled it to 200 people
and no i didn't make up 20%, Gartner did a study on it. and most people with management/hiring experience report the same.
But firing people for performance is framed as the person is bad/stupid/incompetent. The problem with the 5% quota is that it doesn’t necessarily mean you get rid of 5% bad fits. It often results in arbitrary top down push to fire x number of people in the org, which then translates to people with most political prowess keep their jobs and their headcounts while competent people get gaslighted, overworked and eventually fired because of moving goalposts. These people get put on PIP and eventually fired, often by telling them they are bad/incompetent and criticizing them excessively and pulling apart every single thing they do. Some people don’t care about this treatment, but others often face severe physical and mental health problems due to the excessive stress that is put on them.
Also since we are mentioning Google, they had some interesting to say in one of their books [0]:
"Ratings, although an important way to measure performance during a specific period, are not predictive of future performance and should not be used to gauge readiness for a future role or qualify an internal candidate for a different team. (They can, however, be used to evaluate whether an employee is properly or improperly slotted on their current team; therefore, they can provide an opportunity to evaluate how to better support an internal candidate moving forward.)"
and no i didn't make up 20%, Gartner did a study on it. and most people with management/hiring experience report the same.