Final answer:
The performance appraisal method that uses ratings to assign employees to predetermined levels is known as forced distribution. In this method, employees are categorized into different performance levels, based on a bell curve assumption, to prevent rating inflation. Unlike 360-degree feedback, which collects evaluations from multiple sources, forced distribution strictly categorizes performance rankings.
Step-by-step explanation:
A performance appraisal method in which ratings of employees' performance are used to assign employees to pre-determined levels is called B. forced distribution. This method is frequently compared to grading on a curve where a manager is required to categorize employees into a certain percentage of predetermined performance rankings (e.g., top 20%, middle 70%, bottom 10%). The forced distribution model is designed to combat rating inflation, where managers give too many high-performance ratings to their employees. This approach assumes that employee performance across an organization will conform to a bell curve, and therefore separates employees into different performance categories accordingly.
The 360-degree feedback appraisal is quite a different method, as it involves gathering performance data from various sources, including supervisors, peers, subordinates, and sometimes customers. The rationale behind this method is to provide a more balanced view of an employee's performance. 360-degree evaluations are meant to help employees improve through a comprehensive understanding of their strengths and weaknesses from multiple perspectives.
The effectiveness of performance appraisal systems, including forced distribution and 360-degree feedback, is a topic of active research in industrial psychology. These systems are intended to motivate employees, provide a basis for rewards such as promotions or pay increases, and in some cases, document performance for decisions on employment termination.