Lightbulbs,
Like I said...its a bit like the old education exams...the effect is that you are benchmarked against your peers, not some external standard. If your in a very high performing group, you're in the do doo. If you work with malingering idle good for nothings, you'll be good.
I'm sure that's an oversimplification and there must be another layer of benchmarking that overlies the departmental one.
Forced distribution is based on the assumption that there is a lot of poor performance that needs very stringent managing and that this is reduced over time until you reach a healthy work culture. Once you get there then you change the model to one where the performance is benchmarked on an external standard again.