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Performance Management
System
There are various performance appraisal systems which exist and used by the different LATEST JOBS View All
organization. When an organization wants to link the performance of the employee directly with
Job Performance
the reward, generally bell curve performance appraisal system is utilized. In this system, the Odoo Developer...
Standards
employees are categorized based on the ranking given to their performance.  Jakarta  30 Nov -0001
Impact.
Evaluation Procedure
BELLCURVEPERFORMANCEAPPRAISALMANAGEMENTSYSTEM
Employee Self Evaluation

MODERATE
Training and Development RAISES
Plan
(OFTENMATCHRATE
OFINFLATION)
Appraisal Forms COACHED/SUBJECT LARGERRAISESINLINE
TOTERMINATIONS FORPROMOTIONS

Balanced Scorecard

Bell Curve Appraisal

Performance Appraisal its LOW:10% AVERAGE:70% TOP:20%

purpose The system uses three categories namely, top performer, average performer and low performer
employees based on the performance. The bell curve performance appraisal system provides a
360 Degree Performance systematic way to identify the star performers and to link their performance with appropriate
Appraisal reward. It also helps the HR department to identify the low performing employees and further
help them to improve their performances. Some people may argue that the bell curve
Job Analysis
performance appraisal system is a forced ranking system and it is not fair to relatively rank the
performance of employees. However many companies support the use of bell curve
Job Description
performance appraisal system due to its accuracy and utility in terms of improvement of

Job Specification productivity in the organization.

Performance Management
Process
Goal Setting for
Performance Management
Performance Planning
SMART Goals
Performance Appraisal
Failure
Performance Execution
Phase
Legal & Ethical Issues in
Performance Appraisal
system
Performance Management
Tools
Disclaimer: The bell curve performance appraisal system mentioned in this article is shaped to
provide an epigrammatic idea about the concurrent bell curve performance appraisal process
accepted in the organization. The structure is designed for the enrichment of understanding and
to clear the perception regarding the bell curve performance appraisal system. The site
hrhelpboard.com is not responsible for the semblance or correctness of the system. It is
important to professionally verify the suitability of policy before using the content given in the
sample system.
Define
Define what
what is
is aa normal
normal Bell
Bell Curve
Curve –– Meaning
Meaning && Definition
Definition
Normal distribution curve is also known as the Bell curve. The fact that the curve looks exactly
like a bell it is been named as Bell curve. In statistics and social science, the term bell curve is
usually used. It is also called a normal distribution in physics, however, it all refers to a
probability distribution which has specific characteristics one of such characteristic is the bell
shape.
Characteristics of the Bell curve
1. The average or mean of the curve is always located at the center.
2. Bell curve has only one mode or peak.
3. It has a predictable standard deviation.
4. It follows symmetry that means exactly half data is located at the left side and the other half is
Located at the right side of the bell.

Performance Management
Cycle
Job Design
Employee Engagement
Job Satisfaction
What is the normal Bell Curve in Performance Appraisal
Management System in HR
When a company uses a bell curve for their performance appraisal management system it
means the performance grading of all the employees is distributed along the bell curve. Here
the bell curve is used to characterize the employees and divide them into a top performer,
average performer, and poor performer. In order to identify the caliber of employee bell curve
performance appraisal management system is often used in the different organization. The bell
curve process makes it easy for HR to provide rewards to the top performer and put an extra
effort for the average performance. The low performers are identified quite easily and the action
plan can be implemented to improve the performance.

Define the Bell curve appraisal system process using the bell-shaped
graph?
It is important to understand that a star performer should be identified properly in order to
motivate them to achieve organizational goal. However, many a time the error in performance
appraisal system leads to the identification of wrong star performer. The Bell curve performance
appraisal system works on the fact that star performers are limited and very few people can
exceed the performance above the standard expectation of the organization. This performance
appraisal system also helps to identify the weaker link in the organization and HR can take a
decision of layoffs based on the results. Below is the process which is followed to implement
the bell curve appraisal system

1. The pattern should be followed

It is assumed that company talent follows a normal distribution. In a statistical term, this means
there is an equal number of employees which fall on each side of the curve. A very small
number of employees is high achievers while the rest of the employees fall on the right side
which is an average performance. When the bell curve is applied it means employee follows the
pattern and fall in average or worst performance ranking.

2. Ranking should be restricted

A lot of limitations are rigorously applied to the ratings of an employee when the Bell curve is
applied. Most of the cases the HR have to restrict that one out of every 10 employees receives
the lowest possible ranking while very fewer employees get the highest possible rating. In larger
companies, the bell curve is mostly used at division level, which means the employees who are
working in a team has to fight against the manager in order to be a star for the performer.

3. Standards have to be set

Make sure that the expectation and standards are properly conveyed to the employee who is
been ranked under the bell curve performance appraisal system. For example of the sales force
can be ranked based on the revenue generated while a relationship manager can be judged
based on the client assessment. If the company rank their employee based on multiple areas
the main ranking of the bell curve is used by aggregating the numbers. It does help the HR to
know where the employers fell short and up to date improvement plan can be designed.

Why the bell curve is used? How Bell Curve appraisals Method work?
Bell curve appraisal uses the compiling method in order to conclude on performance appraisal
scores and generate a relevant report. The compiled scores are plotted on a graph which
shapes like a bell. Here, the best performing employees are marked over the top part of the bell
while the average employee is marked in the middle and low performing employees are put in
the last part of the bell.
Most generally it is observed that the bell curve places employees on various levels of
performance as described under –
1. Top 20% – High performers
2. Middle 70% - Average/Satisfactory performers
3. Bottom 10% – Non-performers

The employees who are marked on the top 20% of the bell curve are given rewards in terms of
bonus which boost their moral and naturally these employees are considered for future
leadership positions in the company. Employees which are marked in the middle of the bell are
the relatively low performer, however, they are on the average level. Hence, they receive some
monetary rewards and guidance plan is generated for their further performance development.
The employees who are marked at the end of the bell curve receive no financial reward or
sometimes very minimal financial rewards. In order to improve their performance, an action plan
is designed and strictly implemented. Sometimes companies layoffs of the employees who are
marked at the end of the bell curve.
Decisive stance can be taken with the help of the bell curve appraisal system. As a definite
performance slot is defined and employees are included in such performance slot it is easy to
make firm decisions. The business leader believes that this is the best method to identify the
top and bottom level performer and take a strong stand. Many companies periodically use this
bell curve appraisal system in order to check the performance level of the employee. This
performance appraisal system also motivates performers to go ahead and give their best at
their level. It fosters the performance-driven culture in the organization.

Advantages & Disadvantages of bell curve in performance management?

Every system has some pros and cons. Use of bell curve in performance management system
provides some positive points to the HR department, however, there are some drawbacks of the
system as well. Let us look into the advantage and disadvantage of bell curve performance
management system.

Advantages
Advantages of
of the
the Bell
Bell curve
curve in
in the
the performance
performance management
management system
system
1. Top performers can be identified easily
Here the forced ranking compels the manager to make decisions and differentiate between
different employees. The one who is identified as a high performer is awarded and motivated to
work hard for their growth. The career plan and growth plan for these employees are suitably
designed. Initiatives are taken to retain high performing employees in the company this further
helps in succession planning and to retain the top talent in the organization.

Low Average High

Performers Performers Performers
2. Strict and lenient ratings of manager can be managed
This is the only method which organization can use in order to restrict the leniency and stiffness
of the managers rating. The lenient score is defined as a large cluster of employees were getting
all high rating while the strict score leads to a large number of employees getting low ratings.
The unbalanced scoring can be removed and the proper rating can be provided to the
employee. This helps to avoid the mistakes and de-motivate true high performers or retention of
mediocre employees.
3. The suitability of the employee for a particular job position can be identified
The underperformer employee may be suitable for some another position in the company. With
the help of bell curve, performance appraisal system adequate analysis and HR intervention can
be done in order to provide proper job position to the employees. Deeper analysis can be done
for the competency, strength and career plan of employees who are currently low performing.
4. Training needs can be managed
The bell curve performance management system helps to create proper training management in
the organization. Correct allocation of training to the employee can be done using this system.
The bell curve graph helps to identify the training needs and applicable training plan can be
designed for a particular category of employees.
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Disadvantages
Disadvantages of
of the
the Bell
Bell curve
curve in
in performance
performance appraisal
appraisal
1. The system is too rigid
The bell curve model for performance management is considered as a very rigid approach to
rating the performance of employees. Sometimes just for the sake of the bell curve, managers
put employees in a particular category; which is not the true case. This mistake can happen
when the manager has a very small team.
2. Loss of morale
The bell curve performance appraisal system leads to doubts in the mind of both employees.
There is a possibility that employee may get de-motivated; it can lead to loss of morale and the
disorientation of job performance.
3. It is not suitable for small companies
As the number of employees is less than 300 bell-curve performance review is not suitable. For
fever employees, it is difficult to categorize employees in the top performer, average performer,
and low performer level.

Bell curve in performance appraisal example

It is estimated that 75% to 80% of companies in India are currently using the bell curve for the
performance appraisal of their employees. The forced ranking system compares the employees
performance on a relative score and managers plot the performance of their team members
along a normal distribution curve. In the performance-based market, the bell curve system is
found to be appropriate for performance analysis. As the absolute rating for employees are
difficult to manage, the relative rating system is quite suitable for organizations with a big
number of employees. The bell curve system maintains the fairness between the employees by
using the relative ratings.
As per a leader working in the banking sector, every employee will be happy if the performance
is directly linked with the rewards. Thus, the bell curve performance appraisal system is very
much appreciated by the employees. The companies like Wipro, Infosys, ICICI Bank, and Aditya
Birla Group are using the bell curve appraisal system to evaluate the performance of their
employees. The bell curve provides an exact graphical representation of the performance of the
employees and thus it is effectively identified that some employees are performing
outstandingly while some are worst-performers.
In the IT-enabled services industry, the supply of the workforce is outstripped by demand. The
focus of appraisal in such an industry is based on the ability to clearly differentiate between the
individual performances. HCL is looking forward to reinforcing commitment among the
employees using the bell curve performance appraisal system. It upgrades the quality of talent
and also ensures the outstanding contributions from the employees to uplift the performance
benchmarks.

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