HUMAN RESOURCE MANAGEMENT – BELL CURVE PERFORMANCE EVALUATION

METHOD

TWARIT SAXENA-FT192099

In the era of globalisation and urbanisation there is a cut throat competition among organisations. The
key competency of any organization is its ‘people’. MNC’s like GE, Google, Deloitte, Accenture,
Amazon, Facebook, Hindustan Unilever have valued their employees. And this is one of the major
reasons why best minds always strive to work in these firms.
So, what distinguishes one organisation from another?
The ‘people’
What attracts the best talent towards the organisation?
The core values and the work culture
Who draws the framework of the values and work culture?
The HRM team
HR team is responsible for attracting the best minds in the industry, designing and conducting the
recruitment process to filter the potential candidates, helping them grow, upskilling, performance
management, performance appraisal and retaining them in the organisation.
Performance management and performance appraisal processes are of key importance to any
organisation. HR team lays a lot of stress on it to ensure that the best talent sticks with their organisation.
There is a minor difference between the two processes mentioned above. Performance management is
a continuous process while performance appraisal is a periodic process. The former aims at improving
organisational effectiveness while latter is a formal review aiming to improve or help employees by
providing them feedbacks and ratings.
The performance appraisal methods has been a hot topic of discussion in the board rooms. This process
has a direct impact on the quality of work performance of the employees which in turn affects their
productivity. Productivity is directly linked with the growth of the organisation. The growth of the
organisation works in the benefit of the shareholders and improves the credibility of the organisation.
So there should be a proper measure to measure the performance of the employees and rate them. At
times this process gives an insight whether the employee needs training or not for performance
improvement.
The biggest question at this juncture is, how can we measure employee performance or what can be
the methods adopted for the most talked about activity among employees i.e. appraisals?
There are numerous measures available out there. Listing a few them which are prominently used by
companies for evaluating the performance. They are as follows :
Bell Curve, 360 degree feedback systems, peer review, calibration, management by review,
SelfRatings or appraisals by sub ordinates.
Bell curve has been in news since decades. What is your opinion about it?
For decades a major chunk of multinational companies including
Indian companies banked on bell curve for performance evaluation.
It has its own disadvantages. There are times when well performing
employees are rated as average owing to the limited slots allocated
to each percentile. A well performing would not like being labelled
as average just because of quantitative bracket. Also there are times
when employees don’t aspire for the top slot owing to the limitation
of spots. This leads to stagnation in their career and they start to look for job switching options. The
bottom 10% of the employees are mostly put into trainings for upskilling. At times, these employees
might be brilliant and would be a part of the best team. But midst the fierce competition, their talent,
skills, efforts and knowledge is underrated. This leads to attrition and companies spend another major
chunk of their finances in recruiting employees and their training them. Bell curve also leads to
unhealthy competition thereby killing the team spirit. Few employees start performing as the appraisal
time approaches and are rudimentary for the remaining part of the year. And to top it all, there are issues
of favouritism, holding a grudge et.al
So, what in your opinion is the best performance evaluation measure?
Owing to the above mentioned reasons companies are doing away with Bell curve. HRs have worked
in this direction. They have implemented continuous performance evaluation measures like 360 degree
feedback systems instead of yearly. This has helped reduce the hiatus between the management and the
employees. This method is better than relative grading and promotes transparency. It also reduces the
tendency of employees to work with dedication for 2-3 months and hibernate for the rest of the year.
This method helps the employee learn more frequently about his/her performance and gives them ample
opportunities to improve it. Employees are required to fill in their goals and the beginning of the year.
Line manager is informed about the goals of the reportees. The employee as well as the manager stay
in touch with each other and work together towards completion of the goals. This helps the employee
in upskilling themselves and helps the management in getting the best of the employee even in the
absence of cut throat competition. It further improves the retention rate of the organisation as they don’t
have to shell out money in hiring and training newer employees. This method also prevents shocking
situation for the employees at the last moment. This a win-win situation for both the organisation and
the employees.
Companies like IBM,HP, DELOITTE, INFOSYS, AXIS Bank have done away with Bell curve. I
worked for IBM and they implemented Checkpoint. We were required to update our goals in the
beginning of the year and recorded our performance and achievement next to it. Manager monitored it
regularly and helped us in achieving them. At the end, we were awarded bonuses and promotions based
on the goals we had set and the % of their fulfilment. We were evaluated on several parameters like,
client satisfaction, business results, client success, innovation, personal responsibility, skills. These
parameters provided a holistic picture about the employee.
HR practices have evolved over decades and with time they are becoming more employee friendly
because organisations know that their profits are driven solely by their employees. They might have a
good strategy or a plan but it won’t be of any use as long they don’t have the workforce to realise it.
And to have a competitive advantage, organisations make an effort to instil a feeling of pride in their
employees.