Insider

Amazon has a quota for the number of employees it would be happy to see leave each year. Employees say that’s a big reason Amazon’s culture feels cutthroat. (AMZN)

Summary List PlacementAmazon has a complex performance review system that some employees say are rooted in a cutthroat "stack-ranking" culture, as Insider previously reported. One of the key pieces of Amazon's review process is a metric called "unregretted attrition rate (URA)," which represents the percentage of employees managers weren't sad...

Amazon Web Services CEO Andy Jassy

Summary List Placement

Amazon has a complex performance review system that some employees say are rooted in a cutthroat “stack-ranking” culture, as Insider previously reported.

One of the key pieces of Amazon’s review process is a metric called “unregretted attrition rate (URA),” which represents the percentage of employees managers weren’t sad to see leave the company — whether they parted ways voluntarily or otherwise.

Even the most senior executives at Amazon, including incoming CEO Andy Jassy, closely track URAs, according to internal documents obtained by Insider. Jassy, for example, has a “6% goal” for URA, which means he’s expected to replace 6% of his team through “unregretted” departures on what appears to be an annual basis. That can include employees who left on their own volition, but also those who were fired for low performance.

The directive includes executives and managers, though it’s not clear at what level a leader at Amazon might receive a URA target to follow. Several sources say that some leaders may have a URA goal that’s even higher than the 6% followed by Jassy.

In an email to Insider, Amazon’s spokesperson said the URA targets cited in this article are “not accurate and are misleading,” but did not go into specifics. 

The internal documents show that Jassy and other top executives also keep track of the “current unregretted rate,” a running tally of the percentage of employees the company is not concerned about losing, and “current gap to goal,” which is the number of employees it needs to see leave to reach its target URA. It also follows the number of people on an “active development list,” as well as the conversion rate of people on coaching plans to URAs.

One person familiar with the system said tracking URAs help managers refresh their workforce, bringing new employees to the team and cycling those out who weren’t successful at Amazon.

But others are more skeptical about its use: when there are fewer people who leave Amazon under URA than the target, some managers will have no choice but to force out the lowest-performing employees on their team, these people said — even if those employees are generally performing well overall.

It’s a particularly intimidating factor for Amazon employees because they are ranked on a curve under a five-scale rating system, as Insider previously reported. Those in the lowest performing grade could fall victim to URAs, if their managers need to reach their target goals.

Conversely, the documents show Amazon executives follow a metric called “regretted attrition rate,” which represents the percentage of employees the company was not happy about losing. That number is broken down by tenure, job level, and region, as well as “Termination Reasons.”

“Like most companies, we track departures to ensure we are identifying patterns and understanding what they mean,” Amazon’s spokesperson told Insider about regretted attrition rates.

Join the conversation about this story »

NOW WATCH: Why thoroughbred horse semen is the world’s most expensive liquid

Leave a Reply

%d bloggers like this: