The use of the bell curve or forced ranking in performance appraisals has always been a topic of debate amongst HR professionals. Some HR professionals believe that a bell curve is the best way to identify the top performers and under-performers, whereas others believe it compels the appraiser to use a forced rating instead of a fair one.
However, the truth lies somewhere in between. According to the practice of “forced ranking,” in order to develop, a company has to identify its best and worst performers and then “nurture” the winners and rehabilitate/discard the “losers.” While this concept makes sense, its implementation poses great risks, because many companies use the Bell Curve to plot, and ultimately reward, employee performance.
The Bell Curve (also known as normal distribution) assumes there is an equal number of high performers and low performers, and that most employees fall into the average category.Research shows that this statistical model, while easy to understand, does not accurately reflect the way people perform. As a result, HR departments and business leaders inadvertently create agonizing problems with employee performance and happiness. Organisations like Microsoft, GE, CISCO, Infosys, HCL have moved away from the Forced Distribution / Bell Curve method of Performance Appraisal and are having a relook at how to Rank Peoples performance.
Right now there is an epidemic of interest in revamping employee performance management processes, and it’s overdue. What do you have to say ?