TCS abandons bell curve based

performance appraisal; shifting to system of

continuous feedback

MUMBAI: Tata Consultancy Services BSE 1.32 %, India's largest IT services company, said it
has abandoned bell curve based performance appraisal and is moving to a system of continuous
feedback, becoming the latest player to move away from the force dranking system.

The bell curve system one of the most popular appraisal methods popularised by former GE
CEO Jack Welch rates a workforce by comparing performances of people in similar tasks.
They are then segregated into top, medium and poor performers. But over the last two years, an
increasing number of companies have been looking at other ways to evaluate their employees.

"This year we did not do any forced rankings or curve fitting," TCSBSE 1.32 % chief executive
N Chandrasekaran said. "We appraised people based only on their performance. We are now
looking at tools to ensure that the feedback process Bell curve is universally loathed by those
being ranked on it, and TCS employees are happy that the company has scrapped the system.
"There was too much room for manipulation. Lots of people used to be unhappy," a TCS
employee from Mumbai said. "The project managers used to say that they were forced to put
good performers into the poor bracket just to fit the curve," said the person who requested not to
be identified.

A performance appraisal (PA) which is also referred to as a performance review, performance

evaluation, (career) development discussion or employee appraisal is a method with which the job
performance of an employee is documented and also evaluated. Performance appraisals are an
integral part of career development and consist of regular reviews of employee performance within
organizations.

Tata Consultancy Services (TCS) is rethinking its appraisal system for its 3,70,000 plus employees
after scrapping the Bell Curve model.

As the Indian IT sector shifts away from the relative ranking of its 3 million employees, the leading
companies are bringing in new models.
Tata Consultancy Services is rebuilding its appraisal system from the scratch. To start with, some of
the employees will be assessed after a project is completed instead of half yearly.

According to one TCS executive with knowledge of the matter, there will be separate appraisal
systems for IT employees and BPO employees and the company is even looking at how senior
executives should be appraised. This is all in the testing phase now. Nothing firm has been decided.

IT services companies of India and large firms across the globe will keenly watch how TCS manages
its appraisal system, given the scale of the exercise. KPMG, Microsoft, Accenture and Deloitte have
abandoned the Bell Curve, a performance rating system that requires managers to rank their
employees against each other. TCS is looking forward to adopt a system of continuous feedback, a
goal that may be hard to achieve given the number of employees.

Earlier it was reported that TCS was building a technology platform to manage the process of regular
feedback. The TCS executive announced that the company will modify an existing platform for its IT
appraisals, while for the BPO employees it would be more of a social media system.

The same TCS executive added that the system for BPO employees would be more based on social
media, like the internal Knome platform we currently use.

Earlier in this month, a subset of employees received an email detailing the above modifications. As
per the email this is with reference to certain changes being introduced in the Performance
Management System. The stage-wise timelines for appraisal process has been discontinued last year
to encourage the continuous feedback.

We are now moving towards having one appraisal cycle for entire year applicable for all
employees. The email stated that, instead of half-yearly appraisal system, targeted employees would
move to a projectend appraisal cycle and that the projects could last anywhere from two months to
almost a year.

These appraisal cycle changes are in a beta mode and will get rolled out to other employees over
time, a TCS spokesperson said, declining to comment on other changes. TCS is not the only IT
company building new platforms HCL Technologies has one called iSuccess and Wipros is
called PerformanceNext.

A TCS spokesperson stated that these appraisal cycle changes are in a beta mode and will get rolled
out to other employees over time. TCS is not the only IT Company building new platforms HCL
Technologies has one called iSuccess and Wipros is called PerformanceNext.
On the market front, TCS share price Rs 2,300.35, up by 5.09 per cent. Get the most important
support and resistance level of the share at TCS share price forecast.

TCS to rebuild its appraisal

system
Scraping the bell curve model, Tata Consultancy Service is planning to
redesign its appraisal system

Tata Consultancy Service plans to introduce new appraisal system by scrapping the old bell curve
model. The move will affect over 3,70,000 employees working in TCS.

Its appraisal system will be redesigned from the very beginning .To build a flawless model; the
company would be assessing some of its employees after a project is completed instead of half
yearly.
The appraisal system will be separate for IT and BPO employees. Along with that, we would be
looking at how senior executives are be appraised. All is in the testing phase .Nothing has been
decided as of now, said a TCS executive.
Basically, TCS wants to adopt a model where continuous feedback will be given to the employees
instead of assessing on half yearly basis.

Recently, several other companies have abandoned bell curve model, including Deloitte, KPMG,
Microsoft and Accenture.

What is bell curve model?

The concept of bell curve was given by German mathematician Johann Carl Friedrich Gauss in
1809. Also called as Gaussian distributions and normal distributions; the curve resembles a bell
thats why bell curve. As per the model, if you asses employees performance, they will usually fall
into a specific range. It represents standard distribution of a rating or a result.

Example : If you measure value delivered by more than 40 people performing the same job, placing
them under 5 categories (shown below) indicating its range of performance, the chart or graph will
end up looking like a bell curve .

Source : quora.com

Critical analysis of bell curve

The bell curve analysis is usually seen as a rigid framework that in a way compels the manager to
slot some of its team mates under poor performance bucket. So, looking at the assessment, there is
a strong feeling of dissent within the group and they feel threatened that they might be fired soon by
their company.
Some of the companies even feel that the relative ranking process is not in line with their business
and employee needs. Some of the major big techs who have also done away with the model in the
past include Google, Microsoft, Adobe and Accenture .