Outing Poor Performance

• Some researchers state that forced ranking "flushes...laggards into the open." It can be used to eliminate under-performers or as a performance intervention system for under-performing associates. When the organization uses the initial under-performance ranking as a warning technique instead of as a tool for termination, the system might serve to encourage under-performing employees to obtain coaching and other performance improvement training.
  
  

Recognition and Relief for High Performers

• Some managers argue that the lowest performers increase the work burden on the highest performers, and that forced ranking is a fair way to intervene on behalf of those carrying the heaviest performance loads. The system also rates and rewards employees in the high to proficient performance rankings -- the "A" players and "B" players. The "C" players are designated as the bottom 10 percent where no raises or bonuses exist. Instead, "C" players are offered training, asked if they want to remain with the company or are fired.
  
  

Achieving Business Goals

• The forced ranking system requires managers to look at employee performance more critically. Organizations that embrace the system generally believe that poor employee performance is the cause for organization-wide business goals not being met. By raising the performance standards using the forced ranking system, a business should theoretically come closer to meeting its business goals.
  
  

Critics

• The system is not without its detractors. Some argue that it is "brutal and Darwinian," discourages collaborations and creates an atmosphere of hyper-competition among employees. It is also noted that when the system is used within high performing teams, even high performing workers receive low rankings relative to their colleagues. Staff mistrust, demoralization and high instances of discrimination charges are also associated with the employee-evaluation system.