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ON

Performance Appraisal
Under The Guidance Of
Mr. Rohit Vaidya

Submitted By:Anshul Sharma In Partial Fulfillment of the Requirement for the Award OF the Degree of

MASTER

OF

BUSINESS ADMINISTRATION

(MBA)
IN

Human Management

Resource

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(JULY 2013)
ACKNOWLEDGEMENT

I am grateful to Mr.Rohit Vaidya, Associate professor in Marketing, Vivekananda School of Post Graduate Studies for his technical expertise, advice and excellent guidance. I Would Like To Give Special Acknowledgement To Alok Rathore For His Consistent Support And Motivation Scrupulous Critical Reading, But Added Many Examples And Ideas To Improve It. I Am Indebted To My Other Faculty Members Who Gave Time And Again Reviewed Portions Of This Project And Provide Many Valuable Comments. I Would Like To Express My Appreciation Towards My Friends For Their Encouragement And Support Throughout This Project. Anshul Sharma 521139102 (MBA-4TH SEM)

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BONAFIDE CERTIFICATE

Certified That This Project Report Titled Performanc Appraisal Is The Bonafide Work Of Anshul Sharma Who Carried Out The Project Work Under My Supervision.

SIGNATURE

SIGNATURE
ROHIT VAIDYA <DEPARTMENT>F

HEAD OF THE DEPARTMENT <DEPARTMENT> <ACADEMIC DESIGNATION>

fULL ADDRESS OF THE DEPT. OF COLLEGE COLLEGE

FULL ADDRESS OF THE DEPT. OF

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CONTENTS
Chapter I 1.1 Introduction 1.2 Need For The Study 1.3 Limitations Chapter ---2 2.1 Review Of Literature 2.2 Theoretical Background 2.3 Setting Objectives 2.4defining The Appraisers Role 2.5managing The Appraisal

Chapter 3

3.1 Need Of The Study 3.2 Psychological Appraisals

Chapter 4

4.1 Research Methodology 4.2 Assessment Centers

Chapter- 5

5.0 Practical Aspect Of Performance Appraisal

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5.1 360-Degrees Feedback Chapter 6 Suggestion And Conclusion

Annexure

References/ Bibliography

Chapter- I
Performance Appraisal

Introduction
1.1 Introduction About The Study
The Ability To Use Appraisal To Develop And Motivate Employees Is A Core Management Skill. Regular, Constructive Feedback On Performance Is Vital If Staff Is To Build On Their Strengths, Achieve Their Full Potential, And Make The Maximum Contribution To Their Organization. Appraising Staff Equips You With All Skills And Techniques You Need To Conduct Successful Appraisals. It Clearly Explains The Key Aims And Benefits Of The Appraisal Process, And Leads You Step-By-Step Through The Preparation, Management, And Follow-Up Of The Appraisal Interview. The Section Is Packed With Advice To Help You Encourage Open Discussion, Interpret Body Language, Build Confidence, Deal With Performance Problems, And More. During And After World War-1, The Systematic Performance Appraisal Was Quite Prominent. Credit Goes To Walter Dill Scott For Systematic Performance Appraisal Technique Of Man To Man Rating System (Or Merit Rating). It Was Used For Evaluating Military Officers. Industrial Concern Also Used This System During 1920 And 1940s For Evaluating Hourly Paid Workers. However with the Increase of Training and Management Development Programs From 1950s Management

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Started Adopting Performance Appraisal For Evaluating Technical, Skilled, Professional And Managerial Personnel As A Part Of Training And Managerial Development Programs. With This Evolutionary Process, the Term Merit Rating And Been Charged Into Employee Appraisal Or Performance Appraisal. This Is Not Mere Change In The Term But A Change In The Scope Of The Activity As The Emphasis Of Merit Rating Was Limited To Personnel Traits, Whereas Performance Appraisal Covers Result, Accomplishment And Performance. Therefore Performance Appraisal Enables Employee To Get Incentive Treatment According To Their Potential, Sincerity And Capabilities.

1.2 Need of Study

Measuring Performance V/S Action
Come Appraisal Time And One Of The Most Debated Aspects Of Completing The Fair-And-Square Appraisal Revolves Around What Is 'Measured' And What Is 'Achieved'. And The Fable Of The Bees And The Bee Keepers Is A Very Popular Paradigm That Often Gets Quoted At Such Times. It Goes Thus:

The Story: Once Upon A Time There Were Two Beekeepers That Each Had A Beehive.
The Beekeepers Worked For A Company Called Bees, Inc. The Company's Customers Loved Its Honey And Demand For The Product Was Increasing. So Bees, Inc. Assigned Each Beekeeper A Goal For Increased Honey Production. The Beekeepers Had Different Ideas About How To Meet Their Goal And Designed Different Approaches To Improve The Performance Of Their Hives. The First Beekeeper Established A Bee Performance Management Approach That Measured The Number Of Flowers Each Bee Visited. At Considerable Cost To The Beekeeper, An Extensive Measurement System Was Created To Count The Flowers Each Bee Visited. He Also Provided Feedback To Each Bee At Mid-Season On His Individual Performance. He Also Created Special Awards For The Bees Who Visited The Most Number Of Flowers. However, The Bees Were Never Told About The Hive's Goal To Produce More Honey So That The Company Could Increase Honey Sales. The Second Beekeeper Also Established A Bee Performance Management Approach But This Approach Communicated To Each Bee The Goal Of The Hive For Increased Honey Production.

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The Beekeeper And His Bees Measured Two Aspects Of Their Performance The Amount Of Nectar Each Bee Brought Back To The Hive And The Amount Of Honey The Hive Produced. The Performance Of Each Bee And The Hive's Overall Performance Were Charted And Posted On The Hive's Bulletin Board For All The Bees To See. The Beekeeper Created A Few Awards For The Bees That Gathered The Most Nectar.

Performance Appraisal
An Organizations Goals Can Be Achieved Only When People Put In Their Best Efforts. How To Ascertain Whether An Employee Has Shown His Or Her Best Performance On A Given Job? The Answer Is Performance Appraisal. Employee Assessment Is One Of The Fundamental Jobs Of HRM. But Not An Easy One Though.

Meaning And Definition

In Simple Terms, Performance Appraisal May Be Understood As The Assessment Of An Individual's Performance In A Systematic Way, The Performance Being Measured Against Such Factors As Job Knowledge, Quality And Quantity Of Output, Initiative, Leadership Abilities, Supervision, Dependability, Co-Operation, Judgment, Versatility, Health, And The Like. Assessment Should Not Be Confined To Past Performance Alone. Potentials Of The Employee For Future Performance Must Also Be Assessed.A Formal Definition Of Performance Appraisal Is: It Is The Systematic Evaluation Of The Individual With Respect To His Or Her Performance On The Job And His Or Her Potential For Development. A More Comprehensive Definition Is: Performance' Appraisal Is A Formal Structured System Of Measuring And Evaluating An Employees Job Related Behaviors And Outcomes To Discover How And Why The Employee Is Presently Performing On The Job And How The Employee Can Perform More Effectively In The Future So That The Employee Organization And Society All Benefit. The Second Definition Includes Employees Behavior As Part Of The Assessment. Behavior Can Be Active Or Passive--Do Something Or Do Nothing. Either Way Behavior Affects Job Results. The Other Terms Used For Performance Appraisal Arc: Performance Rating, Employee Assessment. Employees Performance Review, Personnel Appraisal.

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1.3 Limitation Of Performance Appraisal

a) Lack Of Clarity:The Objective Of Performance Appraisal Is To Evaluate And Develop Employees. An Organization Should Avoid Using One Appraisal System To Achieve Both Objectives. The Particular System Of The Appraisal System Should Clarify Before It Is Designed And Should Be Discussed With All Managers And Employees To Gain Their Commitment. Any Performance Appraisal System, However Good The Design, Is Unlikely To Succeed If The Managers And Employees Are Suspicious Of Its Objectives. It Is Extremely Difficult If Not Impossible To Device A System That Will Be Able To Satisfy Both Performance And Reward. It Happens Because Employees Are Likely To Resist Negative Feedback And Tend To Be Defensive When Weakness In Current Performance Is Identified. It Is Because Of This Type Of Overlap In Purposes That The Appraisal Loses Its Practically And Increases The Conflict Between The Manager And The Employees. b) Appraisal errors: These Are As Follows;Halo, Recency, Contrast Effects: The Halo Effect Occurs When A Manager Rates An Employee High Or Low On All Teams, Because Of One Characteristic. For Instance; If An Employee Has Few Absences, His Manager Might Give Him High Rates In All Other Area Of Work. c) Rater Biases: This Occurs When Manager Values Distort The Rating. Reasons For Bias Differ, For Instance, Religion, Age, Sex, Appearance Or Other Arbitrary Classifications. If A Manager Strongly Dislikes A Certain Ethnic Group, This Will Be Negatively Reflected In Appraisal If The Appraisal Scheme Is Not Properly Designed.

d) Unequal Performance Standards :People Differ From Each Other In The Way They Perceive Things. What Is Good For Some May Be Bad For Others. Therefore Managers Have Different Judgments In Appraising Their Employees. Managers Attitudes To Their Employees Differ, So Different Managers Will Appraise The Same People Quite Differently Which Could Make Appraisal System Subjective And Manipulative. e) Cultural factors: Culture Has Profound Impact On The Appraisal System As It Should Be In Consonance With The Organizational Culture.

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Chapter 2
2.1 Review Of Literature
Every Individual Has His Or Her Own Viewpoints Towards A Similar Issue. Hence, There Is Similar Issue. Hence, There Is Enough And More Scope For Men Who Are Interwoven In The Organizational Structure To Enter Into Appraising While Working Together. Thus Is Appraising Inevitable Whenever Two Or More Human Beings Work Together. For Healthy And Effective Functioning Of A Human Being In An Organization One Should Be Adept In Handling Appraising An In Resolved Appraising Might Trigger A Long Line Of Troublesome Consequences For The Person As Well As To The Organization. Hence It Is Imperative To Study About The Various Techniques And Strategies Adopted By Persons In Appraising Resolving Strategies Among The Organizational Supervisors. Therefore A Scientific Enquiry In This Area Is Meaningful And Essential. The Present Study Is One Such Attempt. This Review Of Literature Involves Collection Of Some Literature And Works Previously Done In The Same Area And Other Related Areas. By Doing This The Researcher Can Make A Study To Explore New Dimensions In The Same Area And Add To The Body Of Knowledge. The Researcher Can Make A Study To Explore New Dimensions In The Same Area And Add To The Body Of Knowledge.

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2.2 Theoretical Background

Effective Appraisal Is At The Heart Of Successful Management Understand How The Appraisal Process Works, And Recognize How A Well-Managed System Benefits Employees And Organizations.

Developing People Regular Feedback Develops Staff And Helps Them To Achieve Their
Objectives. Create An Environment In Which People Welcome Continuous Feedback, And Use The Appraisal Interview As A Formal Round-Up Of These On-Going, Informal Reviews.

Providing Feedback:
All Employees Want To Know How Their Performance Is Viewed By Their Manager. It Is Important To Provide This Feedback Continuously, Whether It Is Positive Or Negative. Proper Feedback Helps Team Members Identify Where They Need To Improve Their Skills Knowledge And Attitudes. Even Highly Successful Achievers Needs Feedback To Help Them Sustain Their Performance. On-Going Feedback Improves Morale, Since People Know Exactly Where They Stand, And Enables Managers To Express Concerns Than Storing Them Up.

Getting The Most From Appraisal

Provide continuous informal feedback Formally review performanc e Formally review developmen t

An Effective Appraisal System Has Many Benefits. Use It To: Sustain Motivation And Commitment; Continuously Improve Performance; Given Direction And Agree Expected Contributions;
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Set Targets In Line With Organizational And Team Goals; Review Development So Far; Identify Training Needs; Celebrate Successes And Learn From Disappointments; Understand Career Aspirations And Assess Potential; Gather Ideas For Change.

Defining Appraisal
Effective Appraisal Relies On The Provision Of Regular Feedback. This Feedback Is Then Formalized In A Two-Part Review Of A Team Members Performance And Development.

Appraising Effectively Think Carefully About How You Will Give Feedback Both Formally
And Informally. In Order To Build For The Future, It Is Important To Be Constructive In What You Say And To Focus On The Future In The Way That You Say It. Make Sure That All Feedback Is Two-Way, And That Discussions Are Honest And Across, Since People Will React To The Manner In Which You Provide Feedback. Bear In Mind That Criticism Can Be Difficult To Take, Even When An Individual Is Aware That It Is Justified.

Defining Appraisal Types There Are Three Distinct Types Of Appraisal, Each Involving A
Different Approach To Purpose Of Top-Down, Peer, And 360-Degree Appraisals, And Why SelfAssessment Must Feature In Them All.

2.3 Setting Objectives

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Appraisals Provide The Opportunity To Establish Objectives In Line An Organizations Strategy. Bear in Mind That Up-To-Date Job Descriptions Are Vital If You Are to Use Appraisals to Discuses, Revise, And Align Objectives To Your Organizations Aims.

Priming New Employees

The Process Of Setting Objectives Will Begin As Soon As A New Member Of Staff Joins Your Team. Induction Sessions Should Be Used To Introduce Newcomers To The Aims Of Your Organization, And Follow-Up Meetings Should Be Held Afterwards To Ask New Employees For Feedback On The Induction, Agree Job Descriptions, And Set Performance Objectives. If You Fail To Hold This Meeting, A New Recruit Could Be Working For Months Before Appraisals Take Place. Use The Meeting To Pinpoint Training Needs, Identify Other Members Of Staff To Be Met, And Plan Future Development Needs.

DEFINING THE PROCESS OF SETTING OBJECTIVE

Induction session is held to introduce new staff to organization objectives

Follow-up meeting is held to define responsibilities and individual/team objectives

Job descriptions are agreed and documented to provide focus and direction

Job descriptions are reviewed regularly to maintain team and organization focus

Appraisal are used to discuss and refocus individuals if their job emphasis has changed Job descriptions are updated if necessary and new objectives agreed

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Planning For Development

Just As There Is A Strong Link Between The Objectives Of Teams In An Organization, So There Is A Connected Set Of Training Plans. By Reviewing Training And Development Needs At Each Appraisal, You Will Be Able To Match An Individuals Requirements To Those Of Their Team And The Organization. The Appraisal And Each Development Plan Are Important Source Of Information For Organization To Plan Training Requirements. Personal Development Plans (Pdps)

Should Specify The Results You Want To Achieve, So That People Develop In A Way That Helps Them To Achieve Their Objective.

Delegating Control Of Objectives

Agree objective with team member

Allow team member to plan activities

Agree team members plan

Ask team member to suggest options if plan needs to change Agree performance measures with team member

REWARDING SUCCESS

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Effective Appraisal Enables You To Reward Achievement And Encourage Continuous Improvement. Plan To Use Appraisals To Discuss Rewards That Satisfy The Needs Of The Individual And The Organization, Rather Than Focusing On Pay Reviews Alone.

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Analyzing Needs
This Simplified Model Of Psychologist Abraham Maslows Hierarchy Of Needs Illustrates The Importance Of Satisfying Needs At The Lower Levels Before Motivating People At Higher Levels. A Car, A Social Need, May Be Motivational, But It Will Not Be So Until Physiological Needs Have Been Met.

Motivating People
Appraisal Gives You An Opportunity To Reward Your Team By Thanking And Motivating Them. The Fact That You Are Spending Time Alone With Them And Discussing Their Work Is In Itself Encouraging. People Like To Know That Their Work Is Being Observed By Their Manager. Most Are Also Motivated By A Sense Of Autonomy, Where They Feel Responsible For Achieving A Result Rather Than Just Carrying Out Task. This Helps Them To Feel More In Control Of Their Jobs. To Keep Your Team Motivated, Delegate Wherever Possible. If A Team Member Achieves Success In A Delegated Task, Their Sense Of Achievement Is A Great Morale-Booster. Finally, Think About What Will Motivate Each Individual, Since Everyone Has Different Needs.

Preparing To Appraise
Good Preparation Is Essential Part Of Appraising Effectively. Plan Every Aspect Of The Discussion Thoroughly And Ensure That Appraisees Are Well Prepared To Ensure A Successful Outcome.

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Being Prepared
The Appraiser And Appraisee Have Specific Responsibilities In An Appraisal. To Ensure That The Discussion Is Focused And Controlled, Understand Your Own Role And Brief Appraisees On Their Responsibilities So That They Too Can Prepare Effectively.

2.4 Defining The Appraisers Role

The Role Of The Appraiser Is To Encourage And Guide The Appraisee Through The Structure Of The Appraisal. You Should Be A Conduit, Or A Catalyst, Not A Judge Or Interrogator. Plan The Logistics Of The Meeting At Least Two Weeks In Advance. Note Down The Topics You Wish To Discuss In Order Of Importance, So That You Know In Advance What You Need To Cover. Think Of Questions That Will Encourage The Appraisee To Talk. Read Any Guidance Notes That Accompany The Appraisal Documentation Issued By Your Organization. Identifying Goals Having Evaluated Performance, The Next Stage Of Preparation Is To Pinpoint Areas For Improvement And Set Objectives To Achieve Strategic Business Goals. Identify Current Levels Of Performance, And Look For Ways Of Developing Skills And Knowledge. Focusing On Targets Challenging Yet Achievable Targets Are Essential If People Are To Feel Motivated To Improve Performance And Sustain High Standards. Prepare For Effective For Each. Phrase Objectives Carefully, Using Specific, Active Language, Such As Sell And Produce. Avoid Vague Or Ambiguous Terms Such As Liaise Or Improve. Setting Standards

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It Is Important To Set Standards, Covering Both The Job And Personal Behaviour, By Which Competency Can Be Measured. To Help You Do This, Imagine What Ideal Performance Would Look Like. In A Customer Service Environment, For Example, You May Wish To See That Staff Has Developed An Efficient Process For Following Up With Customers As Promised. Next, Think How A High Performer Would Typically Behave-Perhaps He Or She Would Have The Ability To Listen Activity And Empathetically. Avoid Focusing On The People Who Are Currently Doing The Job And Concentrate On The Job Itself And The Desired Results. Assess Whether The Appraisee Is Meeting The Standards So That You Can Discuss Development Or Praise Progress In The Appraisal. Defining Authority Make Sure You Know What You Will Be Able To Agree On Your Own Authority, And What Needs Authorization. If You Are Unsure About This When You Come To Conduct The Appraisal, You Risk Reducing Your Credibility As A Manager By Dashing Them Later. You May Also Lose The Appraisees Trust If You Are Forced To Renege On A Promise That Cannot Be Resourced. Planning Time And Resources Estimate The Duration, And Start And Finishing Times, Of The Tasks Necessary To Achieve The Objectives You Have Prepared For The Appraisee. This Will Help You To Ensure That What The Appraise Suggests Is Realistically Attainable. Estimate How Much Time Is Needed For Development Activities And Assess Whether You Will Need Cover While The Appraisee Is Away. Plan The Resources Needed Both To Achieve Objectives And Undertake Development Activities. Consider Equipment, Materials, And Facilities Such As Working Space. This Well-Prepared Project Plan Will Provide A Starting Point For Your Appraisal Discussion. Allocating Tasks
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Consider In Advance Who Will Be Responsible For Carrying Out Proposed Actions After The Meeting. For Example, Who Will Monitor Any Milestones How Agreed On The Way To The Objectives? Consider How Exceptions Or Shortfalls Could Be Reported. This Task May Be Taking Responsibility Yourself, Who Should Be Responsible For Researching And Organizing Development Work, Such As Training? Finally, Bear In Mind That If The Appraisee Is To Take Ownership Of The Objectives, Achieving Them Must Be Within Their Direct Control. Creating A Positive Environment Conductive Appraisal Environments Encourage Openness, Receptiveness, And Discussion. Build Your Credibility, Create An Atmosphere Of Trust, And Pay Attention To The Layout Of The Meeting Room To Help The Appraisee Relax And Feel Comfortable. Building Trust Trust Grows Over Time, And The Stronger The Relationship Between Appraiser And Appraisee, The More Effective Appraisals Will Become. Earn Your Teams Trust By Putting Into Action Decisions Made During The Appraisal. The Reputation Of An Appraisal System Can Be Ruined If What Is Said In The Appraisal Room Turns Out To Be A Series Of Good Intentions That Are Never Followed Through. You Will Need To Be Assertive As A Manager, But You Should Always Be Seen As Honest, Consistent, And Fair.

Being Objective

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A Managers Personal Approach To An Appraisal Meeting Is Critical To Its Success Prepare Yourself For The Discussion By Considering How You Will Encourage Ideas, Avoid Bias, And Focus On The Important Aspects Of The Job. Encouraging Ideas Remember That You Are Aiming To Encourage People To Come Up With Their Own Ideas And Opinions. You Will Learn Little About Your Team Members, Or Their Ideas, By Simply Telling Them What To Do. Frame Question That Will Prompt Appraisees To Voice Their Ideas And Take Ownership Of What Is Agreed. For Example, You Could Ask What Difficulties They Have Faced And How They Might Overcome Them Next Time. Your Staff Are Likely To Be Far More Knowledgeable About Their Jobs Than You Are. You Also Want To Hear Their Opinions, Not Simply A Reflection Of Your Views. BEING RESULTS-ORIENTED Make Sure That The Appraisal Will Be Focused On What Is Important. If You Discussion Side Issues At Length, You Risk Misdirecting A Team Members Productivity By Leading Them To Think That These Are Important. You Should Also Avoid Subjective Or Judgmental Comments. Having Ser Targets And Standards For What Is Important, Allow Appraisees To Express Results In A Way That Makes Sense To Them. An Appraisees Success Criteria Can Be Just As Valid And Motivating For Them As Quantitative Criteria. Nevertheless, It Is Vital For You Both To Agree On What Is To Be Measured, So That There Are Clear Indicators Of What Has Been Achieved.

Planning The Structure

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A Good Appraisal Is Well Structured, Establish The Order Of Proceeding, And Plan To Get The Meeting Off To A Positive Start. Then Consider How To Focus The Deliver Feedback Effectively.

Being Constructive

Praise

Criticize

Praise

If You Have To Give Negative Feedback, Do So Constructively, Encourage People To Look Forward, Not Backward. Avoid Demotivating A Potentially Good Appraisee By Sounding OverCritical. If Performance Has Suffered, Look First At Your Own Leadership. Have You Misjudged Their Level Of Skill, Or Failed To Provide Support? If There Are No External Reasons, Then The Appraisee Needs To Understand The Impact Of The Problem. Plan How To Tackle The Issues Constructively. How Will You Get Them To Acknowledge That A Problem Exists? Think Of Questions That Will Prompt The Appraise Needs To Find Solutions. He Or She Will Be More Committed To Resolving Matters If The Idea Is Their Own.
Introduction Establish the positive purpose of the meeting Agree items for discussion with the appraisee Initiate two-way communication

Agenda

Discussion

Action plan

FOLLOWING THE SIX-STEP APPRAISAL STRUCTURE

Summary

Agree actions needed to achieve objectives

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Follow up

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2.5 Managing The Appraisal

Introducing The Session
The Start Of A Meeting Sets The Tone For What Is To Come. Launch The Interview Successfully By Putting The Appraisee At Ease. Build Their Confidence, Agree What Will Be Discussed, And Explain How The Meeting Will Be Conducted To Give Them Time To Relax.

Building Confidence

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Many Appraises Feel Nervous And Apprehensive At The Start Of Their Appraisal. Help Them To Overcome Their Anxieties By Creating A Welcoming, Encouraging Atmosphere. Address Any Uncertainties By Stressing The Positives Purpose Of The Meeting And Informing Them How Long You Expect It To Last. To Build Trust And Confidence, Being With A Motivational Statement That Conveys Faith In Their Ability. Then Ask An Easy Question To Start Them Talking. Do Not Launch Abruptly Into The Session By Will Cause The Appraisee To Feel Defensive.

Developing Objectives
The Aim Of The Appraisal Is To Develop A Set Of Objectives That The Employee Is Committed To Achieving. Agree With The Appraise That You Will Discuss Each Previous Objective In Turn To Identify What Went Well, What Did Not Go So Well, And Simply Be To Continue To Maintain High Standards, Or To Develop Their Skills In Order To Improve Their Performance. Establish That You Will Be Setting Future Objectives In The Form Of A Jointly Agreed Action Plan, With Criteria To Measure Success. You Will Also Agree On The Importance Of Objectives To The Team, To The Organization And, Most Importantly, To The Appraisal If They Are Successful.

Review previous objectives Praise achievements Give constructive feedback Identify development needs Praise additional achievements Agree new objectives

ORDERING ITEAMS FOR DISCUSSION

Agree further development needs Plan and agree actions Summarize SUB BY :-ANSHUL SHARMA

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Encouraging Discussion
In A Successful Appraisal Interview The Appraise Should Be Doing Most Of The Talking. Encourage Staff To Take A Leading Role In The Discussion By Adopting Good Questioning Techniques, Then Listening Activity To The Answers

Finding Solutions
The Best Solutions Are Those That Appraisees Discover Themselves. Ask The Appraisee To Come Up With A Plan To Resolve Or Avoid The Problem Next Time. Offer Your Own Ideas Only If Necessary. Discuss The Options Before Making A Decision. If Their Solution Is Unrealistic, Prompt Them To Discuss Its Advantages And Disadvantages, Or Ask Them To Consider The Risks Associated With Their Proposal. By Asking Such Questions, You Can Help The Appraisee To Choose A More Workable Plan Of Action. Finally, Agree A Short And Long-Term Action Plan That Will Immediately Bring Performance Into Line, And Then Continuously Improve It.

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Selecting Activities
The Following Are Examples Of Possible Development Activities: Coaching And Mentoring; Shadowing A Colleague; Reading Journals/Books; Attending Course Or Workshops; Taking On Delegated Tasks; Attending Project Meetings; Being Rotated In A Role Or Transferred To A New Job; Going On Secondment; Attending Conferences, Briefings, Or Seminars; Studying For Professional Or Work-Related Qualifications, Such As First Aid, Health And Safety, Or Business Management.

Planning For The Future :- Find Out About An Appraisees Aspirations For The Future So
That You Can Plan The Support And Development They Need. Use Open Questions To Explore How They Envisage Their Current Role Changing Over The Next Year. Then Ask What The Appraisee Would Like To Be Doing In, Say, One To Two Years Time. Aim To Identify Development Needs For Both Time Frames. There Are Many Ways Of Meeting Development Needs, Such As Special Projects, Site Visits, Or Preparing To Present To Colleagues, That Will Enable An Individual To Gain More Experience Or Skills. Planning Action

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In Order For An Appraisee To Achieve Objectives, It Is Vital That They Know Who Is Responsible For Which Actions And The Deadlines For Carrying Them Out. Agree And Document A Detailed Action Plan That Sets Out What Needs To Be Done. Documenting Actions Write Down Actions That Arise From Your Discussion About Objectives To Ensure That You Have A Record Of What Has Been Agreed. This Will Avoid Any Misunderstandings Or Disagreements Later. Use A Prepared Form, Or Ask The Appraisee To Use A Notepad. Be Careful To Avoid Dictating An Action Plan, Since This Will Not Encourage The Appraisee To Commit To It. As The Appraiser, You May Also Be Responsible For A Few Actions, Primarily Those Concerned With Resourcing Training And Development, Or Informing People In Other Areas Of Your Organization That The Appraisee Has Your Authority To Act.

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Assigning A New Project

Establish the overall purpose of the project

Define the objectives of the project in detail

Outline constraints and find ways to tackle them

Ask the appraisee to list key milestones of the project

Agree on how achievement of milestones will be measured

Check that it is feasible for the appraisee to succeed in project

Creating An Action Plan

Draw Up An Action Plan To Provide A Record Of Actions Agreed. It May Be, No More Than A Simple Note Of Chasing Up Information, Or It May Be A More Detailed Rundown Of New Responsibilities Or Projects.

Planning A Project
A Project Is A Series Of Activities Designed To Achieve A Specific Outcome To A Set Budget And Timescale. Some Of The Objectives You Agree May Well Constitute A Project. If You Agree
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May The Appraisee During The Appraisal, Help Them To Use The Discipline Of Project Management To Improve Their Performance. Make Sure That You Can Measure Success Quantitatively And Qualitatively. Finally, If You Have Any Doubts About The Appraisees Ability To Complete The Project Successfully, Address Them. Decide How The Appraisee Can Overcome The Skills Gap, Or Close It With Training And Development.

Planning Diaries
To Help The Appraisee Use Their Own Initiative And Take Ownership Of Their Objectives, It Is Important That You Keep The Actions That You Agree To In An Appraisees Action Plan To A Minimum. However, There May Be Issues That Are Beyond Their Control, To Manage A Project Or Work Towards An Objective. Let The Appraisee Know What You Need To Do, So That You Can Both Note The Dates By Which Actions Will Be Completed. After The Appraisal, Allocate The Time And Resources You Need To Enable You To Support The Appraisees Achievement Of Their Objectives Without Doing Their Job For Them.

Summatizing The Appraisa

Documenting A Summary Of The Appraisal Provides A Vital Record For Both Parties, And For The Organization, Of What Has Been Agreed. Agree A Detailed Summary With The Appraisee As A Final Cheek That They Are Committed To Their Action Plan.

Involving The Appraisee

Using Their Notes, Or The Form That They Have Filled In, Let The Appraisee Summarize What Has Been Agreed As A Final Cheek That They Are Committed To The Action Plan. If The Appraisee Finds It Difficult To Sum Up The Action Plan In Their Own Words, This Indicates That.

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Clearing Up Misunderstandings
If An Appraise Omits A Vital Point From Their Summary, Or Misinterprets An Issue, Respond Immediately. The Appraisee May Have Altered The Content, Or The Tone Of What Was Said, Perhaps To Avoid Taking Action. Do Not Allow A Misunderstanding To Continue, Since It Will Be Difficult To Raise The Issue Again Without Damaging The Credibility And Trust You Have Built Up. If You Need Clarification, Ask The Appraisee To Repeat The Point, Or Give Your Own Summary And Check That You Are Both On The Same Wavelength.

Evaluating Development
Review agreed learning objectives with the appraisee

Assess whether those objectives were achieved

Ask appraisee how they have applied new skills to their work

Identify actions that have taken place as a result of learning

Evaluate specific improvements to performance

Record result development on personal development plan

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Encouraging Teamwork
The Six-Step Appraisal System Works Just As Well When Used For Teams As It Does For Individuals. Develop The Skills And Improve The Performance Of Your Team As A Whole By Holding Regular Team Appraisals And Integrating Training Needs.

Using The Six-Step Plan

The Six-Step Plan Not Only Provides A Framework For Individual Appraisals But Is Also Useful In The Team Environment. Prepare The Key Issues For Discussion, And Call The Team Together For A Combined Appraisal On How Well They Are Working Together. Explain The Purpose Of The Session And Establish What Team Members Roles Are. If There Are Issues That Involve One Or Two People And Not The Whole Group, Postpone These To A Separate Meeting. As You Work Through The Agenda, Ensure That People Write Down Their Actions. Finally, Ask Everyone To Summarize Their Own Action Plans To Check Their Understanding And Commitment.

Encouraging Team Feedback

Extend The Use Of The Appraisal Process To Improving Teamwork Skills. Ensure That The Entire Team Is Clear About Their Objectives And How They Are Linked To Other Teams Within The Organization. As Well As Encouraging People To Give And Receive Feedback During Their Own Appraisal, Help Them To Be Open And Constructive With Each Other. In The Open Environment Encouraged By An Effective Appraisal, Team Members Should Be Encouraged To Share Information And Knowledge To Build Support And Trust. Use Team Meeting To Solve Problems. Build Good Working Relationships, And Review How The Team Is Progressing Against Objectives.

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Integrating Training
Group Individuals With Common Training And Development Needs Together So That Training Courses Will Be More Economical. Keep A Record For Senior Management Of Who Have Been Attending Course, On Which Subjects, And The Benefits. This Will Allow The Management Team To Assess Whether Their Investment In Training And Development Is Paying Off In Terms Of Business Objectives. If Senior Managers Are Convinced By The Business Case For Developing Their Staff, They Will Continue To Invest. Future Development Plans Are More Likely To Be Approved Of They Build On Past Successes.

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Chapter - Iii 3.1 Need Of The Study

The Purpose Of Performance Management Is To Help And Encourage Everyone To Raise Their Performance, Develop Their Abilities, Increase Job Satisfaction And Achieve Their Full Potential On Desire Level Skill Set Of An Individual To The Benefit Of The Individual And The Organization As A Whole. Performance Appraisal Is The One Of The Most Important Way By Which An Organization Can Understand Its Employees And Evaluate Their Desiring Skill Set To Perform A Specific Task. A Good Employee Appraisal System Helps An Organization To Understand Its Human Capital Needs And Its Weakness. It Also Highlights An Individuals Weakness And Strength. With The Help Of Different Appraisal Technique An Organization Can Achieve The Organizational Objectives, Individual Objectives And Also Mutual Objectives.

Management By Objectives
It Was Peter F. Dracker Who First Gave The Concept Of MBO To The World Way Back In 1954 When His The Practice Of Management Was First Published. The MBO Concept, As Was Conceived By Dracker, Reflects A Management Philosophy Which Values And Utilizes Employee Contributions. Application Of MBO In The Field Of Performance Appraisal Is A Recent Thinking.

Field Review Method

This is an appraisal by someone outside the, assessors own department. Usually someone from the corporate office or the HR department. The outsider reviews Employee records and holds interviews with the rate and his or her superior. This method is primarily used for making promotional decision at the managerial level. Field reviews are also useful when comparable information is needed from employees in different units or locations. Two disadvantage of this method are:1. An "outsider" is usually not familiar with conditions in an employees work environment which may affect the employee's ability or motivation to perform.
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2. An 'outsider' review does not have the opportunity to observe employee behavior of performance over a period of time and in a variety of situations. But only in an artificially structured interview situation which extends over a very short period of time.

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When in doubt. This checker would ask the other clerk if the item is taxable. This checker can be expected to verify with another checker a discrepancy between the shelf and the marked price before ringing up that Item. When operating the quick check. If the lights are flashing this checker can be expected to check out a customer with 15 items. You could expect this checker to ask the customer the price of an Item that he or she does not know. In the daily course of personal relationships, he or she may be expected to linger in long conversations with a customer or with another checker. In order to take a break. This checker can be expected to block off the check sta.

A BARS Scale for the Knowledge and Judgment Dimension of a Grocery Checker's Job.
Raters, making field reviews normally receive training on how to conduct the interview and develop their writing skills. Being independent of the work scene they normally have less bias for or against the rate than docs the immediate supervisor. Even when a supervisor or others concerned supply biased information the rater may be able to pinpoint areas requiring training and development assistance.

Performance Tests and Observations

With limited number of jobs, employee assessment may be based upon a test of knowledge or skills. The test may he of the paper-and-pencil variety or an actual demonstration of skills. The test must he reliable and validated to be useful. Even then, performance tests are apt to measure potential more than actual performance. In order for the test to be job related, observations should he made under circumstances likely to be encountered. Practicality may suffer if costs of test development or administration arc high.

Confidential Records
Confidential records arc maintained mostly in government Departments. Though its application in the industry .not ruled out. ITI. For example. Had followed this method for a long time. Called the Annual Confidential Report (ACR). The approach had 14 itemsa. Attendance. b. Self-Expression (Written Or Oral). c. Ability To Work With Others. d. Leadership. e. Initiative. f. Technical Ability (Job Knowledge). g. Ability To Understand New Material. h. Ability To Reason, i. Originality And Resourcefulness. j. Areas Of Work That Suits The Person Best. k. Judgment. l. Integrity. m. Responsibility n. Defect-Indebtedness. Memo Served. Etc. Twelve Of These Were Filled . o. Grade Scale (Excellent. Good. Fair And Poor).

For integrity. there were special instructions from the management. Justification was required for outstanding or poor rating. Over: rating on a five-point scale was separately given (Outstanding. Very good. Good. Average, Poor). again with justification for rating as outstanding or poor. Recommendations for promotion were also given. The ACR contained recommendations and signature of the rater. the head of the department and the CMD.The system was highly secretive and confidential Feedback to the assesse was given only in case of an adverse entry. The AC'R was highly subjective. Ratings were easily manipulated because the evaluation was linked to promotion. Even ITI has discontinued ACR system for these reasons.

Essay Method
In the essay method the rater must describe the employee within a number of broad categories such as I. II. III. IV. V. The Rater's Overall Impression Of The Employee's Performance. The Promo Ability Of The Employee The Jobs That The Employee Is Now Able Or Qualified To Perform The Strengths And Weaknesses Of The Employee. The Training And The Development Assistance Required By The Employee. Although This Method May Be Used independently, it is most frequently found in combination with others. It is extremely useful in filing information gaps about the employees that often occur in the better structured checklist method. The strength of the essay method depends on the writing skills and analytical ability of the rater. However many raters do not have good writing skills. They become confused about what to say. How much they should state and the depth of the narrative The essay method can consume much time because the rater must collect the information necessary to develop the essay and then he or she must write it The essay method also depends on the memory power of the rater. A problem with this method is that the rate may be rated on the quality of the appraisals that they give. The quality standard for the appraisal may be unduly influenced by appearance rather than content. Thus. a 'high quality' appraisal may provide little useful information about the performance of the rate.

Cost Accounting Method

This method evaluates performance from the monetary returns the employee yields to his or her organization. A relationship is established between the cost included in keeping the employee and the benefit the organization derives from him or her. Performance of the employee is then evaluated based on the established relationship between the cost and the benefit.

Comparative evaluation stuffy

These are a collection of different methods that compare one worker's performance with that of his/her coworkers. Comparative appraisals are usually conducted by supervisors. As these appraisals can result in a ranking from best to worst, they are useful in deciding merit-pay increases, promotions and organizational rewards. The usual comparative forms used in this kind of evaluation are the ranking method and the paired comparison method.

Ranking Method
In this, the superior ranks his or her subordinates in the order of their merit, starting from the best to the worst. All that the HR department knows is that A is better than B. The, 'how' and 'why' are not questioned, nor answered. No attempt is made to fractionalize what is being appraised into component elements. This method is subject to the halo and regency effects, although rankings by two or more raters can be averaged to help reduce biases. Its advantages include ease of administration and explanation.

Paired-comparison Method
Under this method the appraiser compares each employee with every other employee one at a time. For example there are five employees named A, B. C. D and E. The performance of A is first compared with the performance of B and a decision is made about whose performance is better. Then A is compared with C. D and E in that order. The same procedure is repeated for other employees. The number of comparisons may be calculated with the help of a formula which reads thus: N (N-1)/ 2 where N stands for the number of employees to be compared. If there are 10 employees, the number of comparisons will be 10(10-1)/2 = 45. After the completion of comparison, the results can be tabulated and a rank is created from the number of times each person is considered to be superior.

Future-oriented Appraisals
Is it not enough if only the past performance is assessed? How an employee can perform in the days to come is equally important. This can be assessed by focusing on

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employee potential or setting future performance goals. The commonly used future-oriented techniques are MBO, psychological appraisals, and assessment centers.

Four Steps In The Mbo Process How Mbo Works Can Be Described In Four Steps:
The First Step Is To Establish The Goals Each Subordinate Is To Attain. In Some Organizations, Superiors And Subordinates Work Together To Establish Goals. In Others. Superiors Establish Goals For Subordinates. The Goals Typically Refer To The Desired Outcome To Be Achieved. These Goals Can Then Be Used To Evaluate Employee Performance. The Second Step Involves Setting The Performance Standard For The Subordinates In A Previously Arranged Time Period. As Subordinates Perform, They Know Fairly Well What There Is To Do, What Has Been Done, And What Remains To Be Done. In The Third Step, The Actual Level Of Goal Attainment Is Compared With The Goals Agreed Upon. The Evaluator Explores Reasons For The Goals That Were Not Met And For The Goals That Were Exceeded. This Step Helps Determine Possible Training Needs. It Also Alerts The Superior To Conditions In The Organization That May Affect A Subordinate But Over Which The Subordinate Has No Control. As With Other Approaches. MBO Too Has Been Criticized. One Comment Made Against The Approach Is That It Is Not Applicable To All Jobs In All Organizations. Jobs With Little Or No Flexibility. Such As Assembly-Line Work, Are Not Compatible With MBO. An Assembly-Line Worker Usually Has So Little Job Flexibility That The Performance Standards And Objectives Are Already Determined. The MBO Process Seems To Be Most Useful With Managerial Personnel 'And Employees Who Have A Fairly Wide Range Of Flexibility And Self-Control In Their Jobs. Besides, When The Result Of An MBO System Are To Be Used To Allocate Organizational Rewards, Employees May Be Less Likely To Establish Challenging Goals-Goals They Are Confident That They Can Accomplish. Further, The Allocation Of Merit Pay On A Semi-Annual Or Annual Basis May Encourage The Setting Up Of Goals With Short Time Horizons To The Disadvantage Of Important Long-Term Goals.
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3.2 Psychological Appraisals

Large Organization Employs Full-Time Industrial Psychologists. When Psychologists Are Used For Evaluations. They Assess An Individuals Future Potential And Past Performance. The Appraisal Normally Consists Of In-Depth Interviews, Psycho1ogical Tests. Discussions With Supervisors And A Review' Of Other Evaluations. The Psychologist Then Write An Evaluation Of The Employee's Intellectual, Emotional, Motivational And Other-Related Characteristics That Suggest Individual Potential And May Predict Future Performance. The Evaluation By The Psychologist May Be For A Specific Job Opening For Which The Person Is Being Considered. Or It May Be A Global Assessment Of His Or Her Future Potential. From These Evaluations. Placement And Development Decisions May Be Made To Shape The Person's Career. Because This Approach Is Slow And Costly, It Is Usually Required For Bright Young Members Who, Others Think. May Have Considerable Potential Within The Organization. Since The Quality Of The Appraisal Depends Largely On The Skills Of The Psychologists, Some Employees Object To This Type Of Evaluation, Especially If Cross-Cultural Differences Exist. 1. Objectives Of Appraisal Objectives Of Appraisal As Stated Above Include Effecting Promotions And Transfers, Assessing Training Needs, Awarding Pay Increases, And The Like. The Emphasis In All These Is To Correct Problems. These Objectives Are Appropriate As Long As The Approach In Appraisal Is Individual. Appraisal In Future, Would Assume Systems Orientations. In The Systems Approach, The Objectives Of Appraisal Stretch Beyond The Traditional Ones. In The Systems Approach, Appraisal Aims At Improving The Performance, Instead Of Merely Assessing It. Towards This End, An Appraisal System Seeks To Evaluate Opportunity Factors. Opportunity Factors Include The Physical Environment Such As Noise, Ventilation And Lightings, Available Resources Such As Human And Computer Assistance And Social Processes Such As Leadership Effectiveness. These Opportunity Variables Are More Important Than Individual Abilities In Determining Work Performance. In The Systems Approach The Emphasis Is Not On Individual Assessment And Rewards Or Punishments. But It Is On How Work The Work System Affects An Individuals.
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In The Systems Approach The Emphasis Is Not On Individual Assessment And Rewards Or Punishments. But It Is On How The Work Systems Affect An Individuals Performance. In Order To Use A Systems Approach, Managers Must Learn To Appreciate The Impact That Systems Levels Factors Have On Individual Performance And Subordinates Must Adjust To Lack Of Competition Among Individuals. Thus, If A Systems Approach Is Going To Be Successful, The Employee Must Believe That By Working Towards Shared Goals, Everyone Will Benefit. Not That The Role Of The Individual Is Undermined. The Individual Is Responsible For A Large Percentage Of His Or Her Work Performance. Employees Should Not Be Encouraged To Seek Organizational Reasons For His Failures. The Identifications Of Systems Obstacles Should Be Used To Facilitate Development And Motivation, Not As An Excuse To Poor Performance. The Following Table Displays Some Of The Differences Between The Traditional Approach And The Systems-Oriented One. PERFORMANCE APPRAISAL SYSTEMS Traditional Attribution To Individual Control, Documentation Directional, Evaluative Occasional High Individual Orientation Systems Attribution To Systems Development, Problem Solving Facilitative, Coaching Frequent Low Group Orientation

Guiding Value Primary Roles Leadership Practices Appraisal Frequency Degree Of Formality Reward Practices

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2. Establish Job Expectations

The Second Step In The Appraisal Process Is To Establish Job Expectations. This Includes Informing The Employee What Is Expected Of Him Or Her On The Job. Normally, A Discussion Is Held With His Or Her Superior To Review The Major Duties Contained In The Job Place Of Formal Performance Evaluation.

3. Design Appraisal Programmed

Designing An Appraisal Programmer Poses Several Questions Which We Need To Answers. They Are: 1. Formals Versus Informal Appraisal 2. Whose Performance Is To Be Assessed? 3. Who Are The Raters? 4. What Problems Are Encountered? 5. How To Solve The Problems? 6. What Should Be Evaluated? 7. When To Evaluate? 8. What Methods Of Appraisal Are To Be Used?

What Methods? Formal V/S Informal Whose Performance E

When To Evaluate?

Appraisal Design

What Are The Raters?

What To Evaluate? How To Solve?

What Problems

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1. Whose Performance Should Be Rated? To The Question As To Whose Performance Should Be Rated, The Answer Is ObviousEmployees, Is It Individual Or Teams? Specifically The Rate May Be Defined As The Individual, Work Group, Division, Or Organizations. It Is Also Possible To Define The Rate At Multiple Levels. For Example, Under Some Condition, It May Be Desirable To Appraise Performance Both At Work-Group Level For Merit-Pay Increases And At The Individual Level To Assess Training Needs. Two Conditions Necessitate A Group Level AppraisalGroup Cohesiveness And Difficulty In Identifying Individual Performance. Description. Individual Should Not Be Expected To Begin The Job Until They Understand What Is Expected Out Of Them. 2. Formal V/S Informal Appraisal: - The First Step In Designing An Appraisal Programmer Is To Decide Whether The Appraisal Should Be Formal Or Informal. Formal Appraisal Usually Occurs At Specified Time PeriodsOnce Or Twice Year. Formal Appraisals Are Most Often Required By The Organizations For The Purposes Of Employee Evaluation. Informal Performance Appraisal Can Occur Whenever The Superior Feels The Need For Communication. For Example, If The Employee Has Been Consistently Meeting Or Executing Standards, An Informal Appraisal May Be In Order To Simply Recognize This Fact. Discussions Can Take Place Anywhere In The Organizations, Ranging From The Managers Office To The Canteen. But Care Needs To Be Taken To Ensure That The Discussion Is Held In Private. Many Organizations Encourage A Mixture Of Both Formal And Informal Appraisal. The Formal Appraisal Is Most Often Used As Primary Evaluation. However, The Informal Appraisal Is Very Helpful For More Performance Feedback. Informal Appraisal Should Not Take The Group Cohesiveness Refers To Shared Feeling Among Work-Team Members. There Is Cooperation And Clear Understanding To Accomplish Tasks Which Are

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Interdependent. Any Attempt To Assess Individual Performance Shall Undermine Group Cohesiveness And Tend To Promote Individualistic Or Even Competitive Orientation. The Difficulty In Identifying Individual Contribution Is Also Important To Consider. In Some Cases, Interdependent Of Tasks Is So Complete That It Is Difficult To Identify Who Has Contributed What. There Is No Other Choice But To View That Task As A Team Effort. But The Point To Be Remembered Is That The Performance Of All Employees Must Be Rated. All Must Become Raters. Who Are Raters? Raters Can Be Immediate Supervisors, Specialist From The HR Department, Subordinates. Peers, Committees, Clients, Self-Appraisal, Or A Combination Of Several. 1) Immediate Supervisor Is The Fit Candidate To Appraise The Performance Of His Or Her Subordinate. There Are 3 Reasons In Support Of This Choice. No One Is Familiar With The Subordinates Performance Than His Or Her Superior. Another Reason Is That The Superior Has The Responsibility Of Managing A Particular Unit. When The Tasks Of Evaluating A Subordinate Is Given To Another Person, The Superior Authority May Be Undermined Seriously. Finally, Training And Development Of Subordinate Is Am Portent Element In Every Mangers Job. Since Appraisal Programmer Is Often Clearly Linked To Training And Development, The Immediate Superior May Be The Legal Choice To Conduct The Performance Evaluation. 2) Subordinate Can Assess The Performance Of Their Superiors. The Use Of This Choice May Be Useful In Assessing An Employee Ability To Communicate, Delegate Work, Allocate Resources, Disseminate Information, Resolve Intra-Personal Conflict, And Deal With Employees On A Fair Basis. But The Problem With The Subordinate Evaluation Is That Supervisors Tend To Become Popular, Not By Effective Leadership, But By Mere Gimmicks. 3) Peers Are In Better Position To Evaluate Certain Facts Of Job Performance Which The Subordinates Or Supervisors Cannot Do. Such Facts Include

Contribution Skills, Reliability And Initiative. Closeness Of The Working Relationships And The Amount Of Personal Contacts Place Peers In A Better Position To Make Accurate Assessments. Unfortunately Friendship Or Animosity May Result In Distortion Of Evaluation. Further When Reward Allocation Is Based On Peer Evaluation, Series Conflicts Among Co-Workers May Develop. Finally Join Together To Rate Each Other High. d. Although Clients Are Seldom Used For Rating Employee Performance, Nothing Prevents An

Organization From Using This Source. Clients May Be Members Within The Organization Who Have Direct Contact With The Rate And Make Use Of An Output (Goods Or Services) This Employee Provides. Interest, Courtesy, Dependability And Innovativeness Are But A Few Of The Qualities For Which Clients Can Offer Rating Information. Clients, External To The Organization Can Also Offer Similar Kinds Of Information. Where Appraisal Is Made By The Superior, Peers, Subordinates And Clients, It Is Called The 360-Degree System Of Appraisal. First Developed At General Electric, US In 1992 The System Has Become Popular In Our Country Too. GE (India). Reliance Industries, Crompton Greaves, Godrej Soaps, Wipro, Infosys, Thermal And Thomas Cook Are Using The Method With Greater Benefits. The Arthur Anderson Survey 1997 Reveals That 20% Of The Organization Use 360 Degree Method. In The 360 Degree Method, Besides Assessing Performance. Other Attributes Of The AssessTalents, Behavioral Quirks, Values, Ethical Standards, Tempers And Loyalty Are Evaluated By The People Who Are Best Placed To Do It. Many Employees Use Rating Committees To Evaluate Employees. These Committees Are Often Composed Of The Employees Immediate Supervisor And Three Or Four Other Supervisors Who Come In Contact With The Employee. This Choice Is Welcome When An Employee In The Course Of His Or Her Job Performs A Variety Of Tasks In Different Environment. For E.G. 1supervisor May Work With The Employee When Technical Aspects Of A Job Are Being Performed And Another Supervisor May Deal With The Same Employee In Situations Where Communications Skills Are Crucial. There Are Several Benefits In

Using Multiple Raters. First There May Be Objectivity In Rating As More Than Rater Is Involved In The Assessment. Furthermore Where There Are Differences In The Rater Ought Ratings They Usually Stem From The Fact That Raters At Different Level In The Organization Often Observe Different Facets Of An Employee Performance-The Appraisal To Reflect These Differences. The Disadvantages Of Committee Rating Are That It Diminishes The Role Of The Immediate Supervisor In The Area Of Training And Development. In Self Appraisal Employee Himself Or Herself Evaluates His Or Her Own Performance. Indian Telephone Industries Has Been Following The Self-Appraisal System For Executives In Grade I To IV. Hewlett-Packard And Texas Instruments Too Ask Their Performance To Prepare Their Own Appraisal. On The Positive Side It May Be Stated That In Self-Appraisal There Is An Opportunity To Participate In Evaluation Particularly If It Is Combine With Goal Setti9ng And This Should Be Improve The Mangers Motivation. Managers Are Less Defensive In Self-Evaluation Than When Supervisors Tell Them What They Are. Self-Appraisal Is Best Suited Where Executive Development Is The Main Purpose Of Evaluation As The Approach Enablers Managers To Clearly Assess Their Areas Of Differences. Unfortunately Self-Appraisal Falls Short Almost By Any Criterion. They Tend To Be More Lenient Compared To Other Sources Of Evaluation, Even That Of Peers Who Are More Lenient Than Their Superiors. Self-Appraisal Is Also More Likely To Be Less Biased And Less In Agreement With Judgment Of Others. In Practice A Combination Of Methods Is Followed For Employe

CHAPTER IV Research Methodology

Meaning Of Research:
Research Can Be Defined As The Search For Knowledge Or Investigation With An Open Mind Research Is A Common Parlance Refers To Search For Knowledge.

Research Methodology:
Research Methodology Is Maybe Understood As A Science Of Studying How Research Is Done Scientifically. It Is A Way To Systematically Solve The Research Problem. According To The Advanced Learners Dictionary Of Current English Lays Down The Meaning As A Careful Investigation Or Inquiry Especially Through Search For New Facts In Any Branch Of Knowledge.

Research Design:
Research Design Is The Arrangement Of Conditions For Collection And Analysis Of Data In A Manner That Aims To Combine Relevance To Research Purpose With Economy In Procedure, To Know The Performance Appraisal Of The Employees In Hatsun. The Research Design Is The Basic Frame Work Or Plan For A Study That Guides The Collection Of Data And Analysis Of Data. In This Survey The Design Used Is Descriptive Research Type. The Main Purpose Of The Descriptive Research Is Description Of State Of Affairs, As It Exists At Present.

Sampling And Sampling Size:

A Sample Is A Smaller Representation Of A Larger Whole. When Some Of The Elements Are Selected With The Intention Of Finding Out Some Things About The Population From Which They Are Taken, That Group Of Elements Is Referred As A Sample And The Process Of Selection Is Called Sampling.

Sample Size
The Sample Size Is Used For The Study Is 120 Respondents

Sampling Unit
The Sample Unit Is Employees Of The Industry

Sampling Method
The Two Major Methods Are Probability And Non-Probability Sampling Technique. The Studyrequires Probability Sampling Method. The Sampling Method Adopted Is Simple Random Sampling.

Simple Random Sampling

Simple Random Sampling Refers To The Sampling Technique In Which Each And Every Item Or Each Possible Sample Combination In The Whole Population Has An Equal And Independent Chance Of Being Included In The Sample.

Data Collection: The Two Types Of Data Sources Are

Primary Data Secondary Data

Primary Data: Primary Data Was Collected Through Questionnaire. The Data Those, Which
Are Collected As Fresh For The First Time And Happen To Be Original In Character. Questionnaire Method And Interview Method Are Used To Collect The Primary Data.

Secondary Data:
The Secondary Data Which Have Already Been Collected And Analyzed By Someone Else, Secondary Data Were Collected Form Company Profile Previous Records

The Research Approach:

Survey Method: The Most Widely Used Technique Of Gathering Primary Data Is The Survey Method. The Sources Interviewed Personally At The Place Of Work And Also With Questionnaires. It Is A Direct And More Flexible Form Of Investigation Involving Face- To- Face Communication And Through Recorded Questionnaires Filled In Personally. The Information Is Qualitative, Quantitative And Accurate.

The Research Instrument:

Questionnaire Method Interview Method.

Tools Used For Analyzing The Data

This Constitutes An Integral Part Of Research Analysis. Hence Any Analysis Of Data Compiled Should Be Subjected To Relevant Analysis So That Meaningful Conclusions Could Be Arrived. The Statistical Tools Applied In This Research Are, o Simple Percentage Method o Analysis Of Correlation o Weighted Average Method

1. Simple Percentage Method: A Simple Percentage Statistical Tool Was Used To Identify The Percentage Of Respondents Responses. Percentage = (No Of Respondents/ Total No Of Samples) * 100. 2. Analysis Of Correlation XY Correlation = ------------------ (X) (Y). 3. Weighted Average Mean: The Weights Stand For The Relative Importance Of The Different Items wixi

W= W Where Wi = Weighted Average Mean X = Weighted Value W = Respondent

Modern Ways Of Methodology Used In Indusrties

4.2 Assessment Centers

Mainly Used For Executive Hiring, Assessment Center Are Now "Being Used For Evaluating Executive Or Supervisory Potential. An Assessment Center Is A Central Location Where Managers May Come Together To Have Their Participation In Job-Related Exercise Evaluated By Trained Observers. The Principal Idea Is To Evaluate Managers Over A Period Of Time Say One To Three Days, By Observing (And Later Evaluating) Their Behavior Across A Series Of Select Exercises Or Work Samples. Assesses Are Requested To Participate In In-Basket Exercises, Work Groups (Without Leaders), Computer Simulations, Role Paying, And Other Similar Activities Which Require The Same Attributes For Successful Performance, As In The Actual Job. After Recording Their Observations Of Rate Behaviors, The Raters Meet To Discuss These Observations. The Decision Regarding The Performance Of Each Assesse Is Based Upon This Discussion Of Observations. Self-Appraisal And Peer Evaluation Are Also Thrown In For Final Rating.

Assessment Centre - Many Takers

Ranbaxy Retained The Services Of A Team Of Psychologists From The UK-Based Kelly& King To Take The Executives (Of Ranbaxy) Through An Assessment Center. 20 Star Manager Went Through The Exercise. Old Timers Like Tata Have Created Their Own Assessment Centers, And So Have The Talent Centric Companies' Like Wipro And Cognizant.

SHL, A HR Consulting Firm Has Worked With Over 100 Companies Conducting Dose To 1,000 Assessment Centers. Consulting Firm ECS (Formerly Known As Either Consulting Services) Does A Number Of Assessments In A Month For A Variety Of Clients Like Tata Steel, ING Visa And The Host Of BPO Outfits.

ICICI Bank Uses Assessment Center As A Recruitment And Selection Tool To Find The Best Talent, While GE India Subsidiary GECIS Has Used It On 20% Of It5 Middle Managers.

The Problem With The Assessment Centers Is Their Cost Not Only Are The Asses Sees Away From Their Jobs While The Company Pays For Their Travel And Lodging, But The Evaluators Are Often Company Managers Who Are Assigned To The Assessment Center For Short Durations. These Managers Are Often Supplemented By Psychologists And HR Specialists Who Run The Center And Also Make Evaluations. Hence This Approach Is Cost - Effective Only In Large Organizations. Assessment-Center Staff Is Often Influenced By Subjective Element; Such As Personality Of The Candidates: Raters Tend To Evaluate The Quality Of The Individual's Social Skills Rather Than The Quality Of The Decisions He/She Makes. Assessment -Center Ratings Seem To Be Strongly Influenced By The Participant's Interpersonal Skills. The Approach Also Involves Real Hazards. One Of The Most Obvious Is The Examination-Taking Syndrome. Solid Performers In Day-To-Day Operations Feel Suffocated In The Simulated Environment. Another Drawback Is Its Potential Adverse Effect On Those Not Selected To Participate In The Exercise.

Employees Who Receive A Poor Report From The Center May React In Negative Ways. Ideally, A Rejected Employee Would Return To His Or Her Former Job Satisfied That He Or She Would Not Be Promoted To A Job He Or She Could Not Handle. However, A Good Performer At One Level May Leave The Organization In Order To Remove The Bad Assessment Report From His Or Her Work Record. Thus, A Poor Report Can Demoralize An Employee Who Was Once An Asset. Other Problems Include-Strong And Unhealthy Sense Of Competition Among Assesses; Difficulty Of Conducting The Test Frequently; And The Possibility Of Overemphasizing The Test

Performance. But A Well-Conducted Assessment Center Can And Does Achieve Better Forecasts Of Future Performance And Progress Than Other Methods Of Appraisal. Also, Reliability, Content Validity, And Predictive Validity Are Said To Be High In The Assessment Centers. The Test Also Makes Sure That The Wrong People Are Not Hired Or Promoted. Finally, The Assessment Center Test Clearly Defines The Criteria For Selection And Promotion.

CHAPTER- 5
Practical Aspect Of Performance Appraisal

360-Degree Feedback
As Stated Earlier, Where Multiple Raters Are Involved In Evaluating Performance, The Technique Is Called 360 Degree Appraisal. The 360 Degree Technique Is Understood As Systematic Collection Of Performance Data On An Individual Or Group, Derived From A Number Of Stakeholders--The Stakeholders Being The Immediate Supervisors. Team Members, Customers, Peers, And Self. In Fact, Anyone Who Has Useful Information On How An Employee Does The Job May Be One Of The Appraisers. The 360-Degree Appraisal Provides A Broader Perspective About An Employee's Performance. In Addition, The Technique Facilitates Greater Self-Development Of The Employees. For One's Development, Multi-Source Feedback Is Highly Useful. It Enables An Employee To Compare His Or Her Perceptions About Self With Perceptions Of Others. Besides, The 360-Dcgree Appraisal Provides Formalized Communication Links Between An Employee And His Or Her Customers. It Makes The Employee Feel Much More Accountable To His Or Her Internal Or External Customers. The Technique Is Particularly Helpful In Assessing Soft Skills Possessed By Employees. By Design, The 360-Degree Appraisal Is Effective In Identifying And Measuring Interpersonal Skill, Customer Satisfaction, And Team-Building Skills. However, There Are Drawbacks Associated With The 360-Degree Feedback. Receiving Feedback On Performance From Multiple Sources Can Be Intimidating. It Is Essential That The Organization Create A Non - Threatening Environment By Emphasizing The Positive Impact Of The Technique On An Employee's Performance And Development. Further, Firms That Use The Technique Take A Long Time On Selecting The Rater, Designing Questionnaires, And Analyzing The Data. In Addition; Multiple Raters Are Less Adept At Providing A Balanced And Objective Feedback Than The Supervisors Who Are Sought To Be Replaced. Raters Can Have Enormous Problems Separating Honest Observations From Personal Differences And Biases.

Appraise The Performance

The Next Step In The Appraisal Process Is To Measure The Performance. We Revert To The Moral Of The Story Narrated In The Beginning Of This Chapter. The Moral Taught Us That We Need To Measure The Performance And Not Mere Activities. What Then Is Performance? Performance Is Essentially What An Employee Does Or Does Not Do. Employee Performance Common To Most Jobs Include The Following Elements: Quantity Of Output Quality Of Output Timeliness Of Output Presence At Work Cooperativeness

In Addition To These, Other Elements That Deserve Assessment Are Job Knowledge, Leadership Abilities, Judgment, Supervision, Versatility And Health. Assessment Should Also Include One's Potential To Perform And Not Just Actual Performance.

Performance Interview
Performance Interview Is Another Step In The Appraisal Process. Once Appraisal Has Been Made Of Employees, The Raters Should Discuss And Review The Performance With The Rates, So That They Will Receive Feedback About Where They Stand In The Eyes Of Superior. Feedback Is Necessary To Effect Improvement In Performance, Especially When It Is Inadequate. Specifically, Performance Interview Has Three Goals: (I) To Change Behavior Of Employees Whose Performance Does Not Meet Organizational Requirements Or Their Own Personal Goals. (Ii) To Maintain The Behavior Of Employees Who Perform In An Acceptable Manner (Iii) To Recognize Superior Performance Behaviors So That They Will Be Continued.Raters Offer Feedback To The Rates Through Several Methods-Tell And Sell, Tell And Listen, Problem Solving And Mixed. In Tell And Sell, Also Called Directive Interview, The Interviewer Let Assesses Know How Well They Are Doing And Sells Them On The Merits Of Setting Specific Goals For Improvement, If Needed. The Tell And Listen Interview Provides The Subordinates With Chances To Participate And Establish A Dialogue With Their Superiors.

Guidelines For Effective Appraisal Interview

Select A Good Time Minimize Interruptions Welcome, Set At Ease Start With Something Positive Ask Open Ended Questions To Encourage Discussion Listen Manage Eye Contact And Body Language Be Specific Rate Behavior, Not Personality Layout Development Plan Encourage Subordinate Participation Complete Form

The Final Step In The Evaluation Process Is The Use Of Evaluation Data. The Data And Information Generated Through Performance Evaluation Must Be Used By The Hr Department. It May Be Recollected That The Most Significant Rewards Employers Offer To Employees Are: 1. Money To Purchase Goods And Services Required Not Only For Current And Future Survival, But Also For The Luxuries Modern Life Has To Offer. 2. The Opportunity To Use Innate And Learned Skills And Talents In A Productive Manner That The Individual And His Or Her Managers And Co-Workers Recognize As Valuable. 3. Opportunities To Interact With Other People In A Favorable Working Environment. 4. Opportunities To Learn, Grow, And Make Full Use Of Their Potential. 5. A Sense Of Performance And Stability Through The Continuing Existence Of The Organization And The Job. 6. The Opportunity To Perform Work Assignments Within An Environment That Not Only Protects. But Promotes Physiological, Emotional And Psychological Health.

In One Way Or Another, Data And Information Outputs Of A Performance-Appraisal Programmer Can Critically Influence These Coveted Employer-Employee Reward Opportunities. Specifically, The Data And Information Will Be Useful In The Following Areas Of Hrm:

I. Remuneration Administration 2. Validation Of Selection Programmers 3. Employee Training And Development Programmers 4. Promotion, Transfer And Lay-Off Decisions

Deming On Performance Appraisal

Towards The End Of This Section, It Is Worthwhile To Note Edward Deming's Views On Performance Evaluation. Deming Is Opposed To Employee Assessment, Because It: I. Rewards People For Manipulating The System Rather Than Improving It, 2. Is Often Self-Defeating, 3. Is Inconsistent With Team-Work, 4. Acts As A Substitute For Proper Management, And 5. Is Inherently Unfair. His Alternatives To Performance Appraisal Are: 1. Meticulous Selection Of Leaders, 2. Educating Workers About Their Obligations, And Improved Training And Education After Selection, 3. Getting Leaders To Function As Colleagues Rather Than As Judges, 4. Subordinate Performance To Be Assessed Using Statistical Data, 5. Three To Four Hours Interview Annually, With Subordinates Aimed At Support And Encouragement, And 6. Accommodation To Lone Workers.

Challenges Of Performance Appraisal

With The Increased Significance Of Performance Appraisal, Challenges Confronting The System Are Mounting. One Serious Challenge Facing The Performance Appraisal System Relates To Assessment Of Self-Managed Teams. Popularly Called Empowered Teams, These Self-Managed Teams Create Special Challenges For Performance Appraisal-Empowered Teams Perform Without Supervisors. Historically, If One Recalls, It Is The Supervisor Who Assesses The Performance Of His Or Her Subordinates. Another Challenge Is That Both, Individual And Team Performance, Need To Be Measured. A Suitable Device Needs To Be Developed To Assess The Performance Of Empowered Teams Because More And More Firms Use Such Teams To Enhance Productivity. Figure Below Contains A Typical Model Of Team Appraisal.

Identify Kras Critical To Business During The Year

Target Set Tangible s For Eac h KRA. Incorporate Stretch Elements For Each Target. Fix The Minimum Acceptable Target

Determine Intangible Parameters(Like Initiative), Which Indicate Pockets Of Individual Excellence With The Team

Evaluate Performance Of The Team Against Predetermined Targets

Communicate The Results To Ensure Transparency

Measure The Performance Of The Team (ActualVersus Targets) Every Month

Identify Individuals Who Have Excelled. Discount Subjective Factors By Including Assessors From Outside The Team To Identify Outstanding Individuals.

Figure: Appraising Teams

The Following Table Contains Challenges Of Performance Appraisal -

Challenges Of Appraisal:
Create A Culture Of Excellence That Inspires Every Employee To Improve And Lend Himself Or Herself To Be Assessed Align Organizational Objectives To Individual Aspirations Clear Growth Paths For Talented Individuals Provide New Challenges To Rejuvenate Careers That Have Reached The Plateau Stage Forge A Partnership With People For Managing Their Careers Empower Employees To Make Decisions Without The Fear Of Failing Embed Teamwork In All Operational Processes

6.2 Suggesstions
Training Programmes Can Be Organized Based On Interpersonal

Development. Opportunities For Overall Development Must Be Provided In Different Areas, Such As Technology, Team Work, Personality Etc.. Counseling Programme Can Be Arranged To Make The Employees Emotional Independent. The Organization Can Organize Programmes Like Meditation, Yoga And Other Recreation Programmes To Their Employees At Different Levels To Reduce Their Job Stress. Considered Difficult Adverse Are Demanding Job Situations As Inevitable Part Of The Job To Overcome The Hardships. Personality Development Programmes Must Be Given To The Employees To Attain Uniqueness. The Organization Can Organize Training Programmes To Their Employees About The Recent Trends In Industrial Sector. Dont Be Rigid In The Ways Of Functioning Attitudes And Decisions. Employees Must Be Motivated Through Monitory Benefits As Well As Other Welfare Services. Grievance Handling Procedure Must Be Properly Adopted And Rendered To The Employees.
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Conclusion
It Is Evident That Half Of The Respondent Perceives A Moderate Level Of Solution Oriented Strategies. So It Is Recommended That The Strategies Like Collaboration And Compromise Should Be Enhanced Through More Opens Of Discussion Regarding The Appraising Topics. The Problems Should Be Discussed By Allowing All The Members To Collaborate And To Reach A Solution That Is Acceptable. The Members Should Be Ready To Reach A Compromise By Giving Others A Equal Chance. Suggestions From The Relevant Departments And Individuals Should Be Allowed To Get A Clear View Of The Actual Problem. So That, A Good Solution Could Be Made. The Members Should Not Follow The Avoidance Strategy Because It Causes More Problems Due To Lack In Communication Of The Actual Problem. So At The Time Of Decision-Making It Makes Its More Difficult To Reach A Better Solution, Also It Causes Ego Problems Among The Employees. Hence, The Employees Should Not Follow This Avoidance Strategy Is

Followed Mostly It Should Be Avoided. There Is A Need To Develop A Competitive Environment Among The Employees To Have A Control Over The Appraising Topics By Making Them To Work Towards Efficient And Effective Achievements. So That All The Employees Exactly Know The Organizations Goal And To Control Themselves From Creating Problems. By Discussing With The Employees It Is Found That Most Of Them Perceive That The Management Is Not Performing Upto The Task. So, Proper Planning Should Be Done For The Betterment Of The Employees.

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BIBLIOGRAPHY
Books Aswathappa.K, 1999, Organisational Behaviour, Himalaya Publishinghouse, Bombay. Fisher.K And Rayner.S, 1995, Tips For Teams, TATA Mcgraw Hill Book Company, New Delhi. Ghosh.P.K, 2000, Strategic Planning And Management, Sulthan Chand And Sons, New Delhi. Kothari.C.R, 2003, Research Methodology, Wishwa Prakashan Publishers, New Delhi. Luthans Fred, 2002, Organisational Behaviour, TATA Mcgraw Hill Publichers Ltd, New Delhi. Mamoria.C.B, 1997, Personnel Management, Himalaya Publishing Ltd, Bombay. Ramaswami.N, 1997, Organisational Behaviour, Chennai.

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