take a stance for or against forced ranking. Support your response with examples of two pros and two cons that you must consider in your stance. Specify two legal considerations to which an organization may be susceptible if it were to implement forced ranking performance evaluation systems unfairly and inaccurately. Suggest the key corrective actions that an organization could take in order to rectify issues that arise from said unfair and inaccurate implementation. chapter notes below: Welcome to Performance Management. In this lesson, we will be discussing   forced rankings: Pros, cons, and practices.  Please go to the next slide.  2 Objectives Upon completion of this lesson, you will be able to: Evaluate the concept of a forced ranking   performance evaluation system. Please go to the next slide.  3 Supporting   Topics Specifically, we will discuss the   following topics: Pros and cons of a forced rating system; Legal considerations of a forced rating   system; and,  Implementing a forced rating system Please go to the next slide.  4 Definitions It appears   forced ranking usage is infrequent among organizations, according to a 2005   survey conducted by the Society for Human Resource Management. Of the 330 respondents, only 43 indicated   their organization used a force ranking system, and only two indicated that   their organization’s forced ranking approach resulted in terminations. So, what are we   talking about when we say forced ranking systems? A forced ranking system, also known as a   relative rating, specifies a percentage of employees being evaluated must   receive the highest and lowest ratings. Jack Welch, the former CEO to General   Electric, is well known for his forced ranking system known as the Vitality   Model. His model specified that all managers are to rank their employees   based on a twenty-seventy-ten percentage scale, whereas the bottom ten   percent are classified as nonperformers and are typically terminated from   their position.  The absolute   ranking system is based on the same principle, but has a different   flavor. Absolute systems involve   making judgments about people in relation to descriptions of job-related   behaviors or traits, or both. Under these systems, all individual are   independently assessed against the same standards, instead of against one   another. Examples of absolute systems   include behaviorally anchored rating scales and weighted checklists.  Please go to the   next slide.  5 Fairness and   Accuracy Are forced   rating systems fair? This is a   question of value. Let’s look at the   pros and cons of forced ranking systems. After our discussion, you can decide if they appear fair to you.  Advocates for   forced ranking systems argue that the process combats the problem of   artificially inflated ratings. Before Ford Motor Company piloted a forced   ranking system, 98 percent of all managers in the company were evaluated at   the top of.

1. take a stance for or against forced ranking. Support your
response with examples of two pros and two cons that you must
consider in your stance.
Specify two legal considerations to which an organization may
be susceptible if it were to implement forced ranking
performance evaluation systems unfairly and inaccurately.
Suggest the key corrective actions that an organization could
take in order to rectify issues that arise from said unfair and
inaccurate implementation.
chapter notes below:
Welcome to Performance Management. In this lesson, we will
be discussing forced rankings: Pros, cons, and practices.
Please go to the next slide.
2
Objectives
Upon completion of this lesson, you will be able to:
Evaluate the concept of a forced ranking performance
evaluation system.

2. Please go to the next slide.
3
Supporting Topics
Specifically, we will discuss the following topics:
Pros and cons of a forced rating system;
Legal considerations of a forced rating system; and,
Implementing a forced rating system
Please go to the next slide.
4
Definitions
It appears forced ranking usage is infrequent among
organizations, according to a 2005 survey conducted by the
Society for Human Resource Management. Of the 330
respondents, only 43 indicated their organization used a force
ranking system, and only two indicated that their
organization’s forced ranking approach resulted in terminations.
So, what are we talking about when we say forced ranking

3. systems? A forced ranking system, also known as a relative
rating, specifies a percentage of employees being evaluated
must receive the highest and lowest ratings. Jack Welch, the
former CEO to General Electric, is well known for his forced
ranking system known as the Vitality Model. His model
specified that all managers are to rank their employees based
on a twenty-seventy-ten percentage scale, whereas the bottom
ten percent are classified as nonperformers and are typically
terminated from their position.
The absolute ranking system is based on the same principle,
but has a different flavor. Absolute systems involve making
judgments about people in relation to descriptions of job-related
behaviors or traits, or both. Under these systems, all individual
are independently assessed against the same standards, instead
of against one another. Examples of absolute systems include
behaviorally anchored rating scales and weighted checklists.
Please go to the next slide.
5
Fairness and Accuracy
Are forced rating systems fair? This is a question of value.
Let’s look at the pros and cons of forced ranking systems.
After our discussion, you can decide if they appear fair to you.
Advocates for forced ranking systems argue that the process
combats the problem of artificially inflated ratings. Before
Ford Motor Company piloted a forced ranking system, 98
percent of all managers in the company were evaluated at the

4. top of the scale. By forcing a distribution, it is more likely to
ensure a fairer distribution of pay for merit raises.
Advocates also feel this approach is fairer to poor performers
because it gives a definite ranking of where an employee
stands, which gives the employee the opportunity to make
changes.
On the other hand, opponents claim that the forced system
alienates top performers. If a manager is forced to give a top
performance ranking to only two employees in her department,
yet she feels there are five top performers in her department,
the forced ranking system alienates three top performers who
were forced to be ranked as mediocre. This is tied to the belief
that any predetermined performance distribution can never be
fair.
Additionally, opponents find that statistically forced rankings
are impossible to conduct fairly if a firm ranks less than 100
people. Most companies using the forced ranking system use
the methods on thousands of their employees.
All evaluations are typically based on a subjective criteria and
it is in the case for forced ratings. Critics say that too often
rankings are based on subjective judgments tied to standards
that are interpreted inconsistently.
Lastly, opponents feel that forced systems can still lead to
favoritism, or even manipulation and organizational politics.
For example, a manager knowing that he has to rank someone in
his department as unfavorable may keep a poor performer on
the payroll in order to identify the bottom percentage of the
ranking system more efficiently.
Please go to the next slide.

5. 6
Performance Improvement
Our next question is whether or not a forced ranking system
improves individual or group performance. Proponents believe
it distinguishes between talent levels better than any
performance appraisal system. The organization then more
effectively allocates resources for this higher talent pool.
Other business outcomes stemming from having a forced
ranking system include clarity on organizational values that
helps focus employee efforts and reinforcement of a merit-
based culture, which more likely will attract individuals who
value achievement and performance.
On the other side of the coin, opponents point out that a policy
of replacing the bottom 10 percent every year is not
sustainable. At some point an organization is going to start
terminating capable employees.
Ed Lawler, author of “The folly of forced ranking,” criticizes
the forced ranking system by saying, “it hardly makes sense
for managers to invest in developing individuals who are
marginal performers when they believe that in a very short
time they will have to eliminate the employees whom they
develop.”
Lastly, another critic sees that a forced ranking system
undermines collaboration and other contextual behaviors
because the nature of forced rankings creates a “dog-eat-dog”
environment.

6. Please go to the next slide.
7
Employee Morale
Does a force ranking system lift or damper employee morale?
Critics of forced rankings state that low ranking employees
may actually be meeting their goals and objectives, and thus
being rated poorly produces negative morale among capable
employees. Additionally, putting people into brackets, such
as low, middle, and high performance categories, can become a
self-fulfilling prophecy for an individual to carry out the label
given to her. Forced rankings can also create a culture in
which managers are not held responsible for developing
employees.
Advocates for forced ranking system point out that other
appraisal tools can lead to the same negative effects on
employee morale. Additionally, evidence in a few studies points
to overall employee satisfaction is on the decline. One study
cited the inability to remove poor performers quickly as being a
determent to employee morale. The forced ranking system
efficiently identifies these low performers and forces action to
be made, regardless of whether the action is termination.
Please go to the next slide.
8

7. Legal Considerations
Is forced ranking legal? Yes, to one extent, forced ranking
systems do hold up in a court of law. However, the legality
issues involving forced rankings stem from an individual or
group of individuals feeling that the forced ranking system
discriminated against them. For example, a disproportionate
number of older workers receive lower rankings. This has been
the grounds for legal action based on the Age Discrimination
in Employment Act.
Please go to the next slide.
9
Implementation
Many of the controversies surrounding forced ranking systems
stem from the way in which the system was implemented in
the workplace.
There are two areas to consider when implementing a forced
ranking system. The first is the system’s design. Determining
whether the ranking is an independent measure of performance
or a complementary measure is important in setting up the rest
of the system. Organizations will also want to determine the
consequences associated with the ranking results, such as
performance improvement plans, termination, or promotions.
Also, the organization must ensure that the ranking criteria are

8. job related and must decide how to communicate the design to
employees.
The next step is to implement the design. It is imperative that
all managers be trained on how to interpret the rating criteria,
on how to make accurate behavioral observations, and on the
mechanics of participating in ranking discussions. These
ranking sessions must be well coordinated and designed so that
the discussions themselves are structured around the criteria
and not subjective topics. Also, providing guidelines for
managers on how to have the conversation with employees
about their ranking is a useful tool.
Please go to the next slide.
10
Check Your Understanding
11
Summary
We have now reached the end of this lesson. Let’s take a look
at what we covered.
We started by defining relative or forced ranking systems.
They “specify that a percentage of employees being evaluated

9. must receive the highest and lowest ratings.” Absolute rating
systems “involve making judgments about people in relation to
descriptions of job-related behaviors or traits, or both.”
We looked at what forced ranking’s advocates and opponents
say about fairness and accuracy, performance improvement,
and employee morale. Each discussion highlighted these items
in order for you to make an informed opinion whether or not
you feel forced ranking systems are an appropriate
organizational tool.
We then discussed that forced ranking systems are indeed
legal, but that lawsuits about age discrimination have surfaced
as a result of the design or implementation or both of forced
ranking systems.
Lastly, we gave suggestions on how to implement a forced
ranking system.
In the area of designing the system, the recommendations
include:
First, decide how you are going to use ranking;
Second, determine the consequences you want associated with
the results;
Third, ensure ranking criteria is job related; and,
Fourth, decide how to best communicate the design to
employees.
Then, when implementing the design make sure to:
Train raters to use the system;

10. Coordinate and design the ranking sessions among several
individuals; and,
Lastly, provide guidelines for managers to have conversations
with employees about the ranking results
This completes this lesson.