BELL CURVE APPRAISALBell curve appraisal system is a forced ranking system imposed on the employees by the management. It categorizes people based on their performance, and rewards or penalizes the employees accordingly.
Forced ranking has been defined as “a workforce management tool based on the premise that in order to develop and thrive, a company must identify its best and worst performers, then nurture the former and rehabilitate and/or discard the latter”.
Bell curve appraisal system rates the entire workforce by comparing the performance of those engaged in similar activity and ranking them on the basis of their performance. The entire workforce is segregated as the top performers, medium performers and the poor performers. The percentile varies with the company policy; it could be the top 20%, middle 70% and the bottom 10%. The employees belonging to the higher grade contribute significantly to the enterprise.
They are showered with rewards like restricted stock options, bonuses, etc. so as to motivate them to continue their excellent services to the business entity. The middle level employees are significant in number and their presence ensures uninterrupted work flow within the organization.
They generally have some weakness which is negated by the training facilities offered by the company. Similarly training is also provided to enrich their key skills to utilize in a way profitable to the entity. The bottom ranking consists of those whose performance needs significant improvement and whose is unsatisfactory. The ranking acts as a warning system that tells the employee where he stands in relation to his peers.
The employees belonging to the lower strata are at times given the opportunity to improve their efforts or are renounced from the system. The bell curve system of appraisal provides the momentum to the employees to push them forward, aiming higher. This system also states the criteria that are essential to drive the organizational forward.
This helps the organization to recognize the key talents who contribute to the overall objective of the organization. Hence it creates internal competition, motivates to perform at high level and forces low performers to get another job suiting to their skill.
This seems easiest method to push people to perform at next level, increase productivity and maintain a dynamic work environment.