I wish Jack Welch had met my high school buddy Neil who sat in front of me in chemistry class. On the first day of the semester, our teacher Mr. Sproul explained that we would be graded “on a curve”. “The top 10% of you will receive an A, and the bottom 10% will get a D or F. This will preserve the integrity of the grading system and prevent grade inflation.”
Neil raised his hand. “But Mr. Sproul, what if you do a good job as our teacher, and more than 10% of us learn from your lectures and ace every exam? How will you choose who receives an A and who doesn’t?”
“It’s an objective process of ranking by points earned.” Mr. Sproul explained. He then briefly introduced the concept of the normal distribution, and how it applies to the physical sciences, human intelligence- and our grades.
“But Mr. Sproul, what if you do a poor job as our teacher and few of us learn very much, resulting in no one earning many points? Will 1 in 10 of us still receive an A?” Neil asked naively.
Now visibly annoyed, Mr. Sproul went on the offensive. ”That’s the beauty of ranking on a curve, Neil. No matter how poorly you learn in my class, all I have to do is award an A to the other 10% with the most points. It’s really simple.”
“Mr. Sproul,” Neil then asked wryly, “it may be simple for you, but does grading on a curve fairly represent how much the class learns from you?” I finally thumped Neil on the back of the head to save him from himself, but the damage was done. (Remember, this was high school. As adult consultants, we have developed more sophisticated ways of gaining our clients’ attention.)
Poor Neil- in spite of being one of the brightest students, he talked his way out of an A on that first day. Neil and I learned about the sting of forced ranking at an early age.
Ranking "on a curve" with quotas for each performance level, or "forced ranking" may not always work in high school, but is it a useful tool for motivating your employees? Is it consistent with Lean thinking principles? What do we recommend to our clients?
In search of answers, and with help from some of our Affiliates, let's explore the value and consequences of forced employee ranking.
