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Clear as a bell

This article isn’t about new information* but I see many companies continuing to link (or rather, force-fit) performance within a team to a standard distribution, or bell curve.  I’ll touch on appraisals, pay and reward and motivation in here, but they’re too big to include.

There are reasons for grouping performance to a bell curve:  it’s neat, it’s easy to explain and makes reward more predictable when budgeting for example.  But… and a BIG but:

Performance of a team does NOT fit to a bell curve.

Treating performance in this way has performance consequences, and I’m sure you don’t want your team to perform like this!

A little background –

When I began my roles in management and leadership, I completed the prescribed forms in annual appraisal systems, aligning my teams into the allocated 5 categories.  This was normally followed by ‘calibration’ to make sure that there weren’t too many people in either under or over-performing across the company.  We were always aiming for something like this:

And then, pay and reward was worked out from this.  No raises in the low section (if they really aren’t performing at all, why are they there anyway?), everyone in the three mid tiers a moderate or cost-of-living raise, and maybe a higher raise in the top group.

I did this faithfully the to start with, and responses ranged from surprised through to damning.  Engineers who were clearly performing and adding great value to the company felt betrayed and undervalued, while others who knew their performance didn’t compare got rewarded, and got used to being rewarded.  Add on to that, that calibration exercises took in all staff, so people doing very different roles and there’s a greater margin of error.  I lost some great staff to this.

If it’s not clear what I’m talking about, think about the display pilots in the header image, or the Red Arrows.  A standard distribution would imply one of them is great, one is terrible, and the others ‘ok’.  It makes no sense.

So, how does performance really look?

Heard of the 80/20 rule?  That’s already a closer approximation to how performance in most things works.  Look at total household wealth in Great Britain for example:

“…the richest 10% of households hold 45% of all wealth. The poorest 50%, by contrast, own just 8.7%”.  Source: https://www.equalitytrust.org.uk/scale-economic-inequality-uk

Here, the top 10% of households hold almost half of the total wealth in Great Britain; there’s no bell curve.  This is true across many other examples too, whether academia, arts or sport.  Let’s take football as an example.  Of the millions of people who play football, only ~500 play in the UK premier league commanding salaries over £2.5 million / year.  Of those, 5 earn more than £13 million / year.

So, if we conclude that a small number of people provide massive performance (and are higher valued) comparative to others, our team performance graph should look more like this:

Here, while everyone in our team may perform well, there should be a small number of hyper performers that add disproportionately more value than anyone else.  And, I hope that’s familiar to you when you consider it.  For me it certainly is – people that provide 10x or more the value of others.  Makes it so clear why forcing this actual performance into a bell curve causes problems retaining and motivating people.

Have a think about your teams.

  • Does everyone in your team perform their roles, or is there a disproportionality to it?
  • Who are the one or two people that really carry the success or not of your team?  The 20% that deliver 80% consistently, if you will.
  • Are you sure that the value they give is acknowledged and appropriately rewarded?
  • If you conclude that you’re calculating performance incorrectly, what are you going to do next?

* Here’s the supporting study published 7 years ago: https://www.npr.org/2012/05/03/151860154/put-away-the-bell-curve-most-of-us-arent-average

For further reading, I highly recommend you get a copy of Work Rules by Lazlo Bock, who wrote the book while being responsible for all People Operations at Google.  They do not use bell curves 😊.

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