Today's business environment and the shortcomings of existing processes are prompting companies to rethink performance management. Now more than ever, it is critical to identify the top performers and distinguish them from the underperformers. Hence, many are revisiting an old tool: forced ranking.
Forced-ranking systems, established years ago at companies such as GE, are increasingly being reassessed. In a nutshell, these systems typically either align people in preset "buckets" (such as the top 20 percent, the middle 70 percent, and the low-performing 10 percent -- the system used at GE) or rank them by performance from best to worst.
Below, we'll address how organizations currently use forced rankings, consider how such rankings complement existing ways to manage performance, and identify which organizations, functions, and cultures find them most appropriate
Today's business environment and the shortcomings of existing processes are prompting companies to rethink performance management. Now more than ever, it is critical to identify the top performers and distinguish them from the underperformers. Hence, many are revisiting an old tool: forced ranking.Forced-ranking systems, established years ago at companies such as GE, are increasingly being reassessed. In a nutshell, these systems typically either align people in preset "buckets" (such as the top 20 percent, the middle 70 percent, and the low-performing 10 percent -- the system used at GE) or rank them by performance from best to worst.Below, we'll address how organizations currently use forced rankings, consider how such rankings complement existing ways to manage performance, and identify which organizations, functions, and cultures find them most appropriate
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