Meritocracy is a system, organization, or society in which people are chosen and moved into positions of success, power, and influence on the basis of their demonstrated abilities, effort, achievement, contribution, and merit.

Advancement in such a system is based on performance, as measured through examination or demonstrated achievement.

GE: Jack Welch established a meritocracy in GE. Under his leadership, GE switched to making hiring and promotion decisions based on ability and achievement. GE leaders involved everyone, set stretch targets, encouraged their people to take daring action, and rewarded extraordinary achievements. The GE Leadership Effectiveness Survey (LES) made meritocracy principles transparent and provided guidance for performance measurement.