Define forced ranking. What are its benefits and drawbacks?

What will be an ideal response?


In a forced ranking performance review system, all employees within a business unit are ranked against one another, and grades are distributed along some sort of bell curve. Top performers are rewarded with bonuses and promotions; the worst performers are given warnings or dismissed.

Proponents of forced ranking say it encourages managers to identify and remove poor performers and structures a predetermined compensation curve, which enables them to reward top performers. Opponents contend that the system eventually gets rid of talented as well as untalented people. There may also be legal ramifications, as when employees file class-action lawsuits that the forced ranking methods had a disparate effect on particular employee groups. In addition, numeric ratings, rankings, and formal evaluations without positive feedback may produce the opposite of intended results ny creating a culture of reduced performance. Finally, forced ranking systems seem inappropriate today, when over 70% of workers are employed in service or knowledge-intensive jobs in which skills, attitudes, and abilities are hard to evaluate along a bell curve.

Business

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