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Understanding Forced Ranking in Appraisals

Forced ranking is a performance appraisal method that requires managers to rank employees in a forced distribution, such as 10% in the top category and 10% in the bottom category. Those ranked at the top are considered high potentials and receive career development opportunities, while those at the bottom are denied bonuses and pay increases and may be put on probation. Many large U.S. companies have adopted this method. Forced ranking is said to force managers to make difficult talent decisions and sustain a high performance culture, but it also increases unhealthy competition, discourages collaboration, harms morale, and can lead to legal issues.

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54 views1 page

Understanding Forced Ranking in Appraisals

Forced ranking is a performance appraisal method that requires managers to rank employees in a forced distribution, such as 10% in the top category and 10% in the bottom category. Those ranked at the top are considered high potentials and receive career development opportunities, while those at the bottom are denied bonuses and pay increases and may be put on probation. Many large U.S. companies have adopted this method. Forced ranking is said to force managers to make difficult talent decisions and sustain a high performance culture, but it also increases unhealthy competition, discourages collaboration, harms morale, and can lead to legal issues.

Uploaded by

shannbaby22
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd

Forced ranking method in performance appraisal

1. Definition of forced ranking (forced distribution)


Forced ranking is a method of performance appraisal to rank employee but in order of
forced distribution.
For example, the distribution requested with 10 or 20 percent in the top category, 70 or
0 percent in the middle, and 10 percent in the bottom.
!he top"ranked employees are considered #high"potential$ employees and are often
targeted for a more rapid career and leadership de%elopment programs.
&n contrast, those ranked at the bottom are denied bonuses and pay increases. !hey may
be gi%en a probationary period to impro%e their performance.
2. Application of Forced Ranking
'(, Ford )otor, *onoco, +un )icrosystems, *isco +ystems, (,+, (nron and a host of
other -.+. corporations ha%e adopted similar policies of this method
3. Advantages and disadvantages of forced Ranking
Advantages
. !hey force reluctant managers to make difficult decisions and identify the most and
least talented members of the work group.
. !hey create and sustain a high performance culture in which the workforce
continuously impro%es.
Disadvantages
. !hey increase unhealthy cut"throat competiti%eness/
. !hey discourage collaboration and teamwork/
. !hey harm morale/
. !hey are legally suspect gi%ing rise to age discrimination cases.

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