It's going to be up to individuals and to a lesser extent, teams, about how much stack ranking really is an important consideration.

First of all, I haven't seen any evidence of the "fire the lowest X% of the stack rank" attitude which I saw at IBM and which has been reported to happen at Microsoft. Because Google is so selective during the hiring process, I don't think it's as necessary at companies where dead wood accumulates and so the Jack Walsh/GE philosophy of there's always deadwood to be eliminated isn't as applicable. (Sure, there will be PIP plans for problem employees, but that's on a case by case basis, and not driven by statistics.)

Secondly, the stack ranking is just one of the inputs in your perf score, which in turn drives salary increases, bonuses, and equity refreshes. It is also just _one_ component in the promotion process, which is handled outside of the management chain, by committees of engineers that are typically level N+1 and N+2 of the people being considered for promotion. Speaking personally, as far as compensation is concerned, for which the perf score is the primary driver, of course money is important, but it's not my primary motivator, and I'm paid generously enough that whether I get an extra X% isn't going to force me to try to get that extra bump in my perf score. It certainly wouldn't cause me to try to sabotage my colleagues --- and by the way, the stack ranking is also done by your team members and merged into the results (it's not just a stack ranking done by the managers), so trying to get a higher perf score by not being helpful to your colleagues is not a winning strategy.

Finally, I've touched a bit about the promotion process, and certainly at the higher levels, promotion is done by your potential future peers, and is more about recognizing the fact that you are already performing at the level of a Staff Engineer, or a Senior Staff Engineer. Your manager will write a recommendation letter, but certainly at the higher levels, it will be your future peers across the entire company that will be judging whether the work you are doing has the impact and a wider scope which is the hallmark of the higher ranks of the engineering ladder. And of course, if your 20% project happens to have a high impact or affects teams across the company in a positive way, that is something that you can write up in your promotion package, and they will consider it at promotion time.

Also, once you get to Senior Software Engineer, there is no expectation that everyone has to keep on climbing the promotion ladder. There is no "up or out". If you want to do really great engineering work, but it's work that isn't something that fundamentally affects the company's bottom line, or isn't of broad scope, that's OK. You won't get promoted, but at the end of the day, how important is that? You can only buy so many toys, after all, and if you are doing work which is fulfilling and you have other things in your life which is giving you great satisfaction, who cares if you never make Distinguished Engineer or become a Fellow? And that's yet another reason why stack ranking may not be as important.

The bottom line is that "stack ranking" as done by Google is pretty different form what you might think of as "stack ranking" as practiced by other companies, so it's important to keep that in mind.