Is Normalization of Employee Score Force Fitting in the Bell Curve?
No, Normalization of Employee Score is not force fitting in the bell curve. Normalization is carried out to overcome the variance in evaluation style of the Appraiser's. This is to ensure fair grading practice, which also requires to consider the difficulty of assignment and the variability in assessment style of the manager.
Is it applicable even for small organizations?
It is applicable for organizations of all sizes. Raw scores to calculate final grade may not be accurate. Most organizations are departmentalized and each employee has a different job function & role to play, this leaves us with no standard scale to compare performance between different employees. This coupled with the difficulty of assignments and the variability in assessment style of managers makes it imperative to ensure performance score are normalized.
Why is Normalization tied to performance reviews?
Every organization has a clear cut detail w.r.t the number of employees and their compensation details, using this they create a normal curve for estimating budget. When they superimpose the performance rating on this at the end of the year, they will be able to estimate the budget for the variable pay payouts.
The performance review scores provides a statistics on the assessment pattern. To start with, it is important to understand this distribution by Location, Department & by the Appraiser.
This should provide the platform to understand the variance in the assessment style by function & by different managers. Now it will be easy to apply standardization process taking into account the KRA/KPIs of individual employee's and objectively assessing if they were tough or easy. This would ensure there is limited possibility for bias as this ensures objectivity and transparency.
Would it be a better idea to create a common platform and scale for comparing performance of employees?
Yes, but we will not be able to do so because, every employee has a different job function and for each department goals and objectives are different. This makes creating a common platform or a common scale difficult. Hence, blanket comparison of performance across the organization would be inaccurate and ridden with errors.