I've sworn to myself, that the moment that this idiotic idea get introduced in the "performance management" process at the place I work, will be the day that I'll start to send out resumes. Even if it were handled lottery style ("the short straw") I would not cut slack to either manager or company for such an indignity.
You're not being told to pick someone, you're being told that your org cannot really have 80% of people meeting/exceeding expectations and that because reasons (budget), you should review the cusp cases and adjust them down.
If I may offer my anecdata, I've seen several teams that could be characterized by stability and depth of expertise in their respective areas. You could say they always performed on a very high level, but never over-perform, because the high level is what is expected. Stack ranking those teams equates to killing them.
I also agree that a scenario where all individuals over-perform all the time is also rather unrealistic. But individual evaluation of performance is not stack ranking.
In the well run orgs at Amazon the bell curve is applied at the larger scales where it makes sense.
But sure, the larger the structures the more likely regression toward the mean will kick in.