## The Myth of the Bell Curve

#### Joyce Park stashed this in Tech biz

**Stashed in:** LinkedIn, Management, Bill Gates, Brilliant Insight, Management, Human Resources

If your organization's HR policies are all founded on the idea that work performance follows a bell curve, you are dead wrong and very likely to be hurting your org.

Even Bill Gates knows organizations follow the power law not the bell curve:

Research conducted in 2011 and 2012 by Ernest O’Boyle Jr. and Herman Aguinis (633,263 researchers, entertainers, politicians, and athletes in a total of 198 samples). found that performance in

94 percent of these groups did not follow a normal distribution. Rather these groups fall intowhat is called a "Power Law" distribution.A "Power Law" distribution is also known as a "long tail." It indicates that people are not "normally distributed." In this statistical model there are a small number of people who are "hyper high performers," a broad swath of people who are "good performers" and a smaller number of people who are "low performers." It essentially accounts for a much wider variation in performance among the sample.

It has

very different characteristicsfrom the Bell Curve. In the Power Curve most people fallbelow the mean(slightly). Roughly 10-15% of the population are above the average (often far above the average), a large population are slightly below average, and a small group are far below average. So the concept of "average" becomes meaningless.In fact the implication is that comparing to "average" isn't very useful at all, because the small number of people who are "hyper-performers" accommodate for a very high percentage of the total business value.

(Bill Gates used to say that there were a handful of people at Microsoft who "made" the company and if they left there would be no Microsoft.)

The first one is exp(-ax²) and the second one is exp(-ax) if anyone is wondering.

As a physics student, I'm pretty sure there's no specific law and it depends a lot on the quality of leaders at first and the quality of the recruitment then.

Companies are extremely complex systems that will never be described by one simple equation.

There's only two things physics can describe exactly: harmonic oscillator (perfect pendulum) and a reciprocal interaction between two bodies (like the sun and the earth if they were absolutely alone in a totally empty and static universe). Absolutely all the rest, starting from an interaction between 3 bodies, is about doing the right approximation to solve the problem. (That's the difference between math and physics by the way). And the organizations we are talking about are a little bigger than 3 people right?

So conclusion, from my point of view, a simple and only curve, will never describe the human potential of any organization.

Well said.

What the picture is trying to depict is that a few people are responsible for most of what happens in an organization.

12:29 PM Feb 17 2014