forced distribution system
The current issue and full text archive of this journal is available at www.emeraldinsight.com/1741-0401.htm Performance appraisal based on a forced distribution system: its drawbacks and remedies
Rachana Chattopadhayay
International Management Institute, Kolkata, India, and
Anil Kumar Ghosh
Theoretical Statistics and Mathematics Unit,
Indian Statistical Institute, Kolkata, India
Performance appraisal based on a FDS
881
Received 8 August 2011
Revised 29 January 2012
1 May 2012
Accepted 24 June 2012
Abstract
Purpose – Performance appraisal based on a forced distribution system (FDS) is widely used in large corporate sectors around the globe. Though many researchers have pointed out several drawbacks in
FDS, due to the absence of any suitable alternative, it has been (and continues to be) adopted by many industries over a long period of time. The purpose of this paper is to point out some serious limitations of this system and propose a simple modification to overcome these limitations.
Design/methodology/approach – FDS determines the relative positions of the employees involved in similar work by comparing them against one another, and based on their performance, the employees receive different grades. Here the authors use the Likert’s scaling method to convert these grades into numerical scores, then these scores are used to estimate the average performance of each group of employees, which is referred to as the group index. Taking these group indices into consideration, the authors propose a modified performance score of each employee for their final evaluation. Efficiencies of the existing FDS and the proposed modified version are compared using a simple measure of rank correlation known as the Kendall’s tau-statistic.
Findings – Extensive simulation studies show that the modified algorithm is uniformly better than the existing one over different schemes for allocations of employees to different projects, and depending on
Rachana Chattopadhayay
International Management Institute, Kolkata, India, and
Anil Kumar Ghosh
Theoretical Statistics and Mathematics Unit,
Indian Statistical Institute, Kolkata, India
Performance appraisal based on a FDS
881
Received 8 August 2011
Revised 29 January 2012
1 May 2012
Accepted 24 June 2012
Abstract
Purpose – Performance appraisal based on a forced distribution system (FDS) is widely used in large corporate sectors around the globe. Though many researchers have pointed out several drawbacks in
FDS, due to the absence of any suitable alternative, it has been (and continues to be) adopted by many industries over a long period of time. The purpose of this paper is to point out some serious limitations of this system and propose a simple modification to overcome these limitations.
Design/methodology/approach – FDS determines the relative positions of the employees involved in similar work by comparing them against one another, and based on their performance, the employees receive different grades. Here the authors use the Likert’s scaling method to convert these grades into numerical scores, then these scores are used to estimate the average performance of each group of employees, which is referred to as the group index. Taking these group indices into consideration, the authors propose a modified performance score of each employee for their final evaluation. Efficiencies of the existing FDS and the proposed modified version are compared using a simple measure of rank correlation known as the Kendall’s tau-statistic.
Findings – Extensive simulation studies show that the modified algorithm is uniformly better than the existing one over different schemes for allocations of employees to different projects, and depending on
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