Source | LinkedIn : By Ajay Bhatia
‘Bell curve’ has been a guiding framework for most of the organizations since the last so many years, and it has helped in bringing about a discipline in terms of – defining, standardizing, differentiating, measuring and rewarding performance. Clearly, it has been a handy grading tool for creating a high performance culture.
I see that it broadly addresses three key issues that drive corporate performance:
First it encourages management to identify and focus not only on key talent, high potential but also on low performers. Good thing is that this process encourages open dialogue and common understanding among other managers, so that none of these decisions are left to the whims and fancies of individual managers.
Secondly, we all know that in order to remain agile and competitive, organizations have to optimize, conserve precious resources and devise strategies to offer better services, products and experience than their competitors.
Whether we agree or not, relative performance and assessment is a fact of our life. Be it in office or even in schools (where teachers compare good vs average vs bad students) or even at home, where parents are comparing their children.
We also need to be aware of our business environment. In this VUCA world where intense competition, disruption and innovations are the order of the day, Clients have become very demanding. They demand discounts every time they renew contracts. They don’t care much whether you get it through technology introduction or innovation or cost reduction. Coupled with these the frequent increases in statutory minimum wages and other popular govt measures (like the recent bonus limit enhancement). All this puts tremendous stress and pressure on organizational finances. In this context, bell curve helps the organization to bring in more discipline in terms of leveraging the limited budgets, getting more sharper in identifying real performers and under performers, and later distributing the rewards accordingly.