What are your performance-management objectives?
The table below, entitled "Is forced ranking right for you?" provides an overview of the process objectives that any performance-management system should address. Through the matrix, we determine whether forced ranking or peer review fully meets, partially meets, or does not meet the stated objectives.
It is interesting to note that the first three objectives -- alignment, objective, repeatable -- do not automatically occur in any system, yet they are key to having an effective process. The remaining objectives -- development, promotions, termination, pay, feedback, and workforce planning -- begin to differentiate a forced-ranking approach from a non-directed (no rating guidelines) approach.
It is possible to meet some of these objectives outside the actual performance-management process. For example, a financial-services firm recently implemented rigorous promotion criteria using a forced-ranking approach. Although there is no formal performance-management process in place, the forced-ranking criteria have become the foundation for officer selection.