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RESEARCH PROJECT REPORT



On

, A STUDY OF PERFORMANCE APPRAISAL
SYSTEM IN IFFCO

Towards partial fulfilment of
Post Graduate Diploma In Management

Guided by Submitted by
Ms. Seema Gupta Anubha Mishra
Roll No. 2010101020
Session 2011-2012
Faculty of PGDM

Babu Banarasi Das
National Institute of Technology & Management
Sector I, Dr. Akhilesh Das Nagar, Faizabad Road, Lucknow (U.P.) India
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Babu Babarasi Das National Institute of Management
Faculty Of PGDM

Certificate

This is to certify that Research Project Report entitled A Study Of Performance
Appraisal System In Iffco submitted by Anubha Mishra, (Roll.no20101020 ) of
BBDNITM , Faculty Of PGDM Academic Session 2010-12 , as a record of bonafide
Research Project for the partial fulfilment of Post Graduate Diploma in Management
under guidance of Ms. Seema Gupta.
I have examined the project work & certify it worthy of acceptance.



Ms. Seema Gupta Prof. Atul Kumar Singh
Dean, PGDM







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ACKNOWLEDGEMENT

The entire project from the very idea of it to reality would not have been possible
without the guidance and support of many people as no human efforts and attempt
are completed unless somebody pave a right direction and right path so is the case
with me in accomplishing my project. I am indebted to many and it is the high time to
acknowledgement and appreciate them.

















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PREFACE

This report is the result of research completed for the partial fulfilment towards the
award of the degree in PGDM. my project contains a comprehensive detail on one of
the major function of an HR manager and performance of employees. human beings
are a resource to an organization. like any other material on economic resource they
represent an investment whose development and utilization require managing. there
is a fundamental truth in the clinch that people are an organizations most important
asset and training provides full utilization of this asset. training is considered as a
significant and indispensable tool for an organization in todays era because it makes
the employee perfect for the job.

The report contains an introduction to the training in the theoretical concepts. the
company profile of iffco is given in detail the secondary data of training practices in
iffco is also given the finding of the study is given at the end.

At iffco contribution creativity and learning are respected as well as expected
machines cannot replace the people and success of this organization is because of
its employees for the employees to give their optimum output the organization is
because of its employees for the employees to give their optimum output the
organization has to be cooperative with the needs of its employees by making
arrangements of training and development programs in the organization the skill and
efficiency of the employees can be increased which in turn contributes to the
production of the company.
Anubha mishra
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EXECUTIVE SUMMARY
Literature on performance appraisal

I Rationale Performance appraisals are one of the most important requirements for
successful business and human resource policy (Kressler, 2003). Rewarding and
promoting effective performance in organizations, as well as identifying ineffective
performers for developmental programs or other personnel actions, are essential to
effective to human resource management (Pulakos, 2003). The ability to conduct
performance appraisals relies on the ability to assess an employees performance in
a fair and accurate manner. Evaluating employee performance is a difficult task.
Once the supervisor understands the nature of the job and the sources of
information, the information needs to be collected in a systematic way, provided as
feedback, and integrated into the organizations performance management process
for use in making compensation, job placement, and training decisions and
assignments (London, 2003).

After a review of literature, a performance appraisal model will be described in detail.
The model discussed is an example of a performance appraisal system that can be
implemented in a large institution of higher education, within the Student Affairs
division. The model can be applied to tope level, middle-level and lower level
employees. Evaluation instruments (forms) are provided to assist you with
implementation the appraisal system.



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CONTENT
Page No.
Introduction 7
Researches On Performance Appraisal 12
Company Profile 14
Financial Performance 17
Introduction 27
Performance Appraisal Methods 30
Aims Of Performance Appraisal 39
Contribution Enhancement Plan 42
Appraisal System In Iffco 45
Job Satisfaction 56
Performance Appraisal Co relation With Job Satisfaction 70
Research And Methodology 71
Objective Of The Study 72
Limitations Of Performance Appraisal 73
Analysis And Interpretation 74
Summary Of Findings 84
Recommendations 85
Conclusion 86
Bibliography 87




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INTRODUCTION

Performance evaluations have been conducted since the times of Aristotle
(Landy,Zedeck, Cleveland, 1983). The earliest formal employee performance
evaluation program is thought to have originated in the United States military
establishment shortly after the birth of the republic (Lopez, 1968). The measurement
of an employees performance allows for rational administrative decisions at the
individual employee level. It also provides for the raw data for the evaluation of the
effectiveness of such personnel- system components and processes as recruiting
policies, training programs, selection rules, promotional strategies, and reward
allocations (Landy, Zedeck, Cleveland, 1983). In addition, it provides the foundation
for behaviorally based employee counseling In the counseling setting, performance
information provides the vehicle for increasing satisfaction, commitment, and
motivation of the employee. Performance measurement allows the organization to
tell the employee something about their rates of growth, their competencies, and
their potentials. There is little disagreement that if well done, performance
measurements and feedback can play a valuable role in effecting the grand
compromise between the needs of the individual and the needs of the organization
(Landy, Zedeck, Cleveland, 1983).

Purpose
Performance appraisals should focus on three objectives: performance, not
personalities; valid, concrete, relevant issues, rather than subjective emotions and
feelings; reaching agreement on what the employee is going to improve in his
performance and what you are going to do (McKirchy, 1998). Both the supervisor
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and employee should recognize that a strong relationship exists between training
and performance evaluation (Barr, 1993). Each employee should be allowed to
participate in periodic sessions to review performance and clarify expectations. Both
the supervisor and the employee should recognize these sessions as constructive
occasions for two-way communication. Sessions should be scheduled ahead of time
in a comfortable setting and should include opportunities for self-assessment as well
as supervisor feedback. These sessions will be particularly important for new
employees who will benefit from early identification of performance problems. Once
these observations have been shared, the supervisor and employee should develop
a mutual understanding about areas for improvement, problems that need to be
corrected, and additional responsibilities that might be undertaken. When the goals
are identified, a plan for their achievement should be developed. The plan may call
for resources or support from other staff members in order to meet desired
outcomes. In some cases, the plan might involve additional training. The supervisor
should keep in contact with the employee to assure the training experiences are
producing desired impact (Barr, 1993). A portion of the process should be devoted to
an examination of potential opportunities to pursue advancement of acceptance of
more complex responsibilities. The employee development goals should be
recognized as legitimate, and plans should be made to reach the goals through
developmental experiences or education (Barr, 1993). Encouraging development is
not only a supervisor's professional responsibility, but it also motivates an employee
to pursue additional commitments. In addition, the pursuit of these objectives will
also improve the prospect that current employees will be qualified as candidates
when positions become available. This approach not only motivates current
performance but also assists the recruitment of current employees as qualified
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candidates for future positions (Barr, 1993). How to arrive? Reasons why need to be
done Benefits of productive performance appraisals. - Employee learns of his or her
own strengths in addition to weaknesses. - New goals and objectives are agreed
upon. - Employee is an active participant in the evaluation process. - The
relationship between supervisor and employees is taken to an adult-to-adult level. -
Work teams may be restructured for maximum efficiency. - Employee renews his or
her interest in being a part of the organization now and in the future. - Training needs
are identified. - Time is devoted to discussing quality of work without regard to
money issues. - Supervisor becomes more comfortable in reviewing the performance
of employees. - Employees feel that they are taken seriously as individuals and that
the supervisor is truly concerned about their needs and goals. (Randi, Toler, Sachs,
1992).

Pitfalls to Avoid
When conducting performance appraisals on any level, it is important to keep in
mind the common pitfalls to avoid.
These pitfalls may include but are not limited to:

1. Bias/Prejudice. Race, religion, education, family background, age, and/or sex.

2. Trait assessment. Too much attention to characteristics that have nothing to do
with the job and are difficult to measure.

3. Over-emphasis on favorable or unfavorable performance of one or two tasks
which could lead to an unbalanced evaluation of the overall contribution.
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4. Relying on impressions rather than facts.

5. Holding the employee responsible for the impact of factors beyond his/her control.

6. Failure to provide each employee with an opportunity for advance preparation
(Maddux, 1993).

Legal Implications
Any performance appraisal system used to make employment decisions about a
member of a protected class (i.e. Based on age, race, religion, gender, or national
origin) must be a valid system (an accurate measure of performance associated with
job requirements). Otherwise, it can be challenged in the courts based on Title VII of
the 1964 Civil Rights Act, the Civil Rights Act of 1991 and the Age Discrimination in
Employment Act of 1975 (London, 2003).

Uniform Guidelines on Employee Selection 1978 is the controlling federal law in the
area of performance appraisals. The Equal Employment Opportunity Commission
(EEOC) requires that any measurement used to differentiate between employees
must be valid and fairly administered. The Americans with Disabilities Act (ADA)
suggests that performance appraisals for people with disabilities for people with
disabilities will not be conducted any differently than those for other employees.
Another important aspect to consider is the employees right to privacy. Employees
must have complete access to their personnel files, but others should have
controlled access. The records should be accurate, relevant, and current.
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Rewards
Effective reward systems are often hard to establish when creating performance
appraisals. The question of how specific the reward, when the reward should be
given, and how to reward group efforts can be a tricky subject to master.
Our advice on this is to keep it simple. It is important to have an established reward
system. However, rewards can be as simple as more autonomy on the job, praise for
progress, additional professional development funding, and vacation time.
The important aspect to remember when establishing reward systems is to be
consistent. If two employees are being evaluated in the same way, their reward
opportunities should reflect their evaluation outcomes.














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RESEARCHES ON PERFORMANCE APPRAISAL

Due to the growing focus on the personnels development, there is an increasing
concern regarding the use of effective assessment methods. Performance appraisals
are being used by a large number of organizations for assessing their employees
performance and its effects on the organization as a whole. Similarly, universities
make use of the assessment methods to assess the learning of their students.
Despite the Popularity of performance appraisals there is an ongoing debate
regarding the effectiveness of the assessment methods and use of performance
appraisals (Schraeder, Becton & Protis, 2007). This believe can be further
strengthen up by the research done by Clinton O & Stephen J, which shows that less
that 20 percent of the performance appraisals are proved to be effective predictors of
employees performances.

Positive impacts of Performance Appraisal:
Performance appraisal has a very important role to play in managing individual and
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get better grades
group performances (CIPD). There is a considerable amount of agreement among
managers and researches about the positive impacts of personnel rating and
evaluation of performance. Performance appraisals can proved to be very helpful
and successful if they focus primarily on the improvement of organizational
performance as a whole, and especially if its attributes are in line with those of the
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organizational aims and goals (Schraeder, et al., 2007).
The significance of performance appraisals has been discussed in various studies by
different authors, for example Larson (1984) described the feedback as integral part
of the control system of any organization and this view point is also supported by
other authors (Morris et al., 1991; DeCarlo and Leigh, 1996) in their findings, they
defined performance appraisals as one of the most important job responsibilities of
the line managers (Pettijohn, Parker, Pettijohn and Kent, 2001). There are number of
potential benefits associated with the use of...

















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COMPANY PROFILE
IFFCO-A PRIDE VENTUREOF COOPERATIVES
Indian farmers fertiliser cooperative limited(iffco) maintaining its creditable
performance and position has spread its wings across the shores to emerge as a
force to reckon with on the map of worlds cooperative movement.in ihe year 2009-
10,iffco showed commendable performance in all the spheres of its
functioning,surpassing its own previous best records in the areas of
production,sales,transporation,specfic energy consumption and overall
performance.the equity capital of rs.6 lakhs contributed by the cooperatives in 1967
has risen upto rs.426 crores in 22009-10.

VISION AND MISSION
Iffco has successfully accomplished its corporate plans,mission 2005 and vision
2010.it has now embarked upon another compre hensive ambitious plan vision-
2015,which will guide the societys efforts in emerging as a global leader.the salient
features of vision-2015are:
to emerge as a global leader in fertilisers production to cater to the food security
need of the nation.
maximising the synergies of the core business through downstream value
additions and forward/backward integrations.
enhancing presence in international markets through strategic joint ventures and
synergistic acquistions.
diverification in to other profitable business to maximize returns to our stakeholders.
leveraging state of the art technologies and global best practices to retain its global
competitiveness.
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achieve ferilisers production/marketing target of 15 million tonnes per annum with
an annual turnover of rs.30,000 crore.

PRODUCTION
Iffco commissioned its kalol and kandla plants in Gujarat in early 1975 and
subsequently added two more plants at phulpur & aonla in uttar Pradesh in the year
1981 and 1988 respectively and acquired dap/npk plant paradeep in 2005.the
society produced the highest ever 81.98 lakh mt of fertilisers comprising all time high
43.24 lakh mt urea and the highest ever 38.74 lakh mt np/npk/dap during 2009-10.

MARKETING
The marketing of iffcos products-npk/np/dap/urea is channelized through 39,862
cooperative outlets and 158 farmers service centres over 29 states/union territories
across the country.during 2009-10,iffco has notched up a record sale of 118.27 lakh
tonnes of fertiliser material comprising 63.35 lakh tonnes of urea and 54.92 lakh
tonne of npk/dap/np/map.best ever marketing productivity also sprang to 7885
tonne/head.iffco meets almost one fourth of the countrys fertiliser demand.

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FINANCIAL PERFORMANCE

Iffco recorded a turnover of rs.16809 crore during 2009-10 while its pre-tax profit
stood at rs.567.28 crore and profit-after tax at 401.10 crore and profit-after tax at
401.10 crore the society for the first time monetized its carbon credits by effecting its
sale to a Spanish agency for a consideration of rs.4 crore under clean development
mechanism(cdm) of united nations framework of climate change as a result of
efficient foreign exchange management the society earned foreign exchange gain of
rs.105 crore during the year the society declared a dividend of 20 percent for its
shareholders for ninth year in a row.

INFORMATION AND COMMUNICATION TECHNOLOGY
Ict initiatives kept pace with the developments taking place in the organisation the
applications like maintenance management system financial management system e-
procurement marketing applications workflow applications have been further
augmented with enhanced functionalities. In recognition of iffcos initiatives
prestigious awards viz top 10 green it enterprise award cio 100 award ciol enterprise
connect award and great mind challenge for business award were bestowed on iffco.

COOPERATIVE DEVELOPMENT
The society has grown in strength and stature from a modest membership of 57 in
1967-68 to 39862 societies benefiting 5 crore farmers to encourage cooperatives
and cooperative development work iffco presents eminent cooperators with
sahakarita bandhu award and sahakarita ratna awardevery year and pt
Jawaharlal Nehru memorial iffco lecture is arranged to commemorate the
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cooperative week celebration cooperative development programmes are arranged
for co-operators of other countries.

Iffcos chairman has been elected for the second time on the global board of
international cooperative alliance (ica).iffco has also received the first dot coop
global award for cooperative excellencein recoginition of its efforts for providing
services to its cooperative members.iffco has carved out a niche for itself efforts by
upholding cooperative values and strong cooperative identity.

CORPORATE SOCIAL RESPONSIBILITY(CSR)
Iffco has undertaken several social activities in the areas of community development
environment protection health-care/medical facilities etc the society continued to
galvanise its efforts at the development of model agricultural villages with an aim to
bring about overall up liftment in the living standards of rural community through
integrated rural development with particular emphasis on agriculture development
,creation of drinking water facilities medical and veterinary check up.

Various promotional and extension programmes organised during the year 2009-10
focussed on improving soil health promoting balanced use of fertiliser in this
period,5292 field programmes,1118 sale point personnel training programmes,153
crop seminars were organised seed multiplication programme was undertaken on
1303 ha.during rabi 2009 2009-10,910 agriculture campaigns were organised while
1,51,41rs on agri3 soil samples were analysed.
Twenty four special projects on agriculture,social and community development
programmes in various ststes are in progress.these projects aim at watershed
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management,agriculture development and micro enterprises,assisting the small
farmers and self-help groups in earning livelihood.the society has instituted 18 chairs
at agricultural universities/cooperative institutions in the disciplines of agronomy,soil
science,agroeconomics ,agricultural extension,cooperation and fertiliser technology
to provide a link between these institutions in areas of research,education and
extension.to strengthen the village societies.205 storage-cum-community centres are
in operation and nine more centres are in various stages of completion.these centres
are utilised for storage of fertilisers and agricultural inputs,apart from providing
venues for organising agricultural extension activites following trusts/cooperatives to
promote its csr initiative:

IFFCO KISAN SEWA TRUST
This trust was established to provide relief and rehabilitation to the victims in the
event of natural calamities like floods,earthquake,cyclones,fires,landslides and
droughts etc.the trust undertakes a variety of activites to assist needy farmers in
getting medical assistance,organising eye camps,health camps,cancer detection
camps,providing medical equipment,arranging for blood through red cross society
and financial assistance to various hospitals for the treatment of farmers.

INDIAN FARM FORESTRY DEVELOPMENT COOPERATIVE LTD(IFFDC)
Iffdc was promted in 1993 with the prime objective of development of wasteland for
social forestry.iffdc initially implemented afforestation and rural development projects
in uttarpradesh,Madhya Pradesh and rajasthan.with the passage of time,the area of
operation has been extended to uttarakhand,Jharkhand,Orissa,Chhattisgarh,Andhra
Pradesh,west Bengal,assam,tamilnadu and Maharashtra.afforestation in 27000
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hectares of wasteland had been achieved by promiting 146 village level primary farm
forestry cooperative societies in various states of the country.iffdc projects helped in
enhancing socio-economic status of the villagers and has been hailed by state and
central government and won many laurels and awards.

COOPERATIVE RURAL DEVELOPMENT TRUST(CORDET)
Cooperative rural development trust provides practical training to farmers to improve
their skill in farming and allied areas i.e. animal husbandry,horticulture,bee-
keeping,pisciculture,printing,tailoring,fruit and vegetable preservation etc.the trust
operates from phulpur in uttarpradesh and from kalol and kandla in Gujarat.it also
provides free soil testing facilities to the farmers.during 2009-10,cordet tested 99564
soil samples and organised 249 training programmes benefiting more than 14314
farmers including women from various states.

IFFCO FOUNDATION
Iffco foundation,a think tank ofiffco,provides support to farmer members in
agricultural development through technology transfer.it provides forum for exchange
of thoughts on issues relating to food security and agricultural development at the
global level especially in saarc,African and latin amaeican countries,which has
opened avenues for larger cooperation among farmers at the global level.

IFFCOS ASSOCIATES AND SUBSIDIARIES
A number of associates and subsidiaries has lent credibility and strength to
iffco.performance of these ventures is briefly given as under:

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IFFCO-TOKIO GENERAL INSURANCE COMPANY
During 2009-10,iffco-tokio recorded a gwp of rs.1,639.56 crores andearned a profit
before tax of rs.38.61 crores.the unique rural products of the company like
sankatharan bima yojana,barish bima yojna,kisan suvidha bima yojna,mausam bima
yojna cater to the insurance needs of the farming community.itgi with its micro
insurance initiative like janta bima yojna,jansuraksha bima yojna,janwasthya bima
yojna and mahila suraksha bima yojna,has been able to take forward the message
and benefits of insurance to underprivileged international labour organization (ilo) to
carry out the cattle insurance project using rfid technology called pashuhan bima.

OMAN INDIA FERTILISER COMPANY
Iffco contributed 25 percent in the equity of this company.during the year ended 31
st

December,2009,omifco had performed very well.the company produced 20.29 lakh
tonne urea,1.25 lakh tonne surplus ammonia with its revenues at $322 million and
profit after tax at us $146 million.

IFFCO CHHATTISGARH POWER LIMITED(ICPL)
The society made its foray into power sector with the mission of empowering the
agricultural sector with more power.icpl was set up in joint venture with cseb for
establishing a pit-head power project of 1320 mw capacity in district
surguja(Chhattisgarh) at an estimated cost of rs.7500 crore.iffco will hold a stake of
74 percent.icpl has signed power purchase agreement(ppa) with Chhattisgarh state
electricity board (cseb)for 90 percent of net power to be produced from the project
and balance power would be sold to other states.the project activites have started
and major inputs like fuel,water be sold to other states.the project activites have
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started and major inputs like fuel,water and land have been tied up.the major
clearance like environment,forest etc are expected soon.the project has been
grantedin principle approval of mega power status by the ministry of
power.commercial operation is scheduled to start in the year 2013-14.

IFFCO KISAN SANCHAR LIMITED(IKSL)
Iffco kisan sanchar limited (iksl) was incorporated in april,2007 with the objective of
empowering farmers with pertinent information to improve decision making ability
towards sustainable agriculture and better living.the society has invested an amount
of rs.3.65 crore to acquire 72.99 percent equity in iksl.during the financial year 2009-
10,iksl has further consolidated its activites in 18 states by providing location
specific,time sensitive information and alerts to its rural subscribers.the subscriber
base of iksl at the end of march 2010 was 50 lakh,which predominantly focuses upon
rural community.about 22000 cooperative societies have become a part of this
channel in terms of diversifying their business in to this emerging
telecommunication in rural india.
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NCDEX/NCMSL
Iffco stepped in to the area of commodity exchange by acquiring 12 percent stake in
ncdex.the exchange offers contracts in 50 commodities which includes 27 agriculture
commodities,7bullion,6 metals,6 energy and 3 polymers and 1 environment(carbon
credit).iffco holds stake in national collateral management services limited
(ncmsl),which provides procurement,storage and preservation,quality testing and
certification,collateral management and information services.



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KISAN INTERNATIONAL TRADING FZE(KIT)
Kisan international trading fze(kit) was set up as a wholly owned subsidiary of the
society in dubai in april 2005.the outfit has successfully completed its fifth financial
year of operation.kit has become a leading international trading organization,which
handles the import and export of various fertilisers and fertiliser raw materials and
intermediates.

JORDAN INDIA FERTILIZER COMPANY(JIFCO)
Iffco and Jordan phosphates mines company ltd had formed a limited liability joint
venture company,namely Jordan india fertilizer company(jifco) in amman,Jordan
under the free zonesystem to st up a phosphoric acid plant of 1500 tonnes perday
p2o5 capacity at eshidiya in Jordan.in this company,iffco holds 52 percent
equity,while jpmc holds 48 percent equity.jpmc will make available the required
quantity of rock phosphate for the project.the project has obtained necessary
approvals and clearances including environmental clearance from the government of
Jordan to start construction activities at site.

IFFCO KISAN SEZ LIMITED
Iffco is also setting up a multi-product iffco kisan sez at Nellore(Andhra Pradesh)
with primary focus on food processing and agri based industries .the formal approval
for development,operation and maintenance of the multi product special economy
zone,had been received from the governmentof india.the master plan of the sez has
been finalised.letters of intent have been received from various overseas and
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domestic investors for initiating their operations in sez.one of the main activites in
this is setting up of the most modern integrated dairy project.
INDIAN POTASH LIMITED(IPL)
Ipl is primarily engaged in trading of imported potassic and non-potassic fertilisers for
domestic consumption.ics has capacity to produce 660,000 mt of phosphoric acid
(as p2o5) per year.the company exported 256,561 mt of p205 to iffco in the year
2009,which is about 39 percent higher than 2006.

LEGEND INTERNATIONAL HOLDING,AUSTRALIA
The project in Australia aims at commercial mining of rock phosphate.the rock
phosphate supplies from legend will ensure availability of raw material for paradeep
plant without any constraint.the rock phosphate supplies arriving over the years from
legend will help in production of quality phosphatic fertilisers in the interest of
farmers.

AMERICAS PETROGAS INC.CANADA
After diversifying in to insurance,power,rural mobile telephony and commodity
exchange,iffco has ventured in to potash as well as gas and oil exploration sectors
by becoming an equity partner with 50 percent buy back to potash,alongwith its
associate in the Canadian company,growmax agri corp (growmax) and Americas
petro gas inc.
Iffco has also entered in to a memorandum of understanding(mou) with
phoschem,usa and phosagro,Russia for import of dap/npk,which will ensure
uninterrupted supply of these essential fertilisers to the member societies.
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With its strong cooperative character iffco will continue to lead from the front with its
pioneering efforts and strong financial base.a global fertiliser giant iffco believes




















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INTRODUCTION

Performance Appraisal


The history of performance appraisal is quite brief. Its roots in the early 20th century
can be traced to Taylor's pioneering Time and Motion studies. But this is not very
helpful, for the same may be said about almost everything in the field of modern
human resources management.


As a distinct and formal management procedure used in the evaluation of work
performance, appraisal really dates from the time of the Second World War - not
more than 60 years ago.

Yet in a broader sense, the practice of appraisal is a very ancient art. In the scale of
things historical, it might well lay claim to being the world's second oldest profession!

There is, says Dulewicz (1989), "... a basic human tendency to make judgements
about those one is working with, as well as about oneself." Appraisal, it seems, is
both inevitable and universal. In the absence of a carefully structured system of
appraisal, people will tend to judge the work performance of others, including
subordinates, naturally, informally and arbitrarily.
The human inclination to judge can create serious motivational, ethical and legal
problems in the workplace. Without a structured appraisal system, there is little
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chance of ensuring that the judgements made will be lawful, fair, defensible and
accurate.


Performance appraisal systems began as simple methods of income justification.
That is, appraisal was used to decide whether or not the salary or wage of an
individual employee was justified.
The process was firmly linked to material outcomes. If an employee's performance
was found to be less than ideal, a cut in pay would follow. On the other hand, if their
performance was better than the supervisor expected, a pay rise was in order.
Little consideration, if any, was given to the developmental possibilities of appraisal.
If was felt that a cut in pay, or a rise, should provide the only required impetus for an
employee to either improve or continue to perform well.

Sometimes this basic system succeeded in getting the results that were intended;
but more often than not, it failed.

For example, early motivational researchers were aware that different people with
roughly equal work abilities could be paid the same amount of money and yet have
quite different levels of motivation and performance.

These observations were confirmed in empirical studies. Pay rates were important,
yes; but they were not the only element that had an impact on employee
performance. It was found that other issues, such as morale and self-esteem, could
also have a major influence.
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As a result, the traditional emphasis on reward outcomes was progressively rejected.
In the 1950s in the United States, the potential usefulness of appraisal as tool for
motivation and development was gradually recognized. The general model of
performance appraisal, as it is known today, began from that time.





















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PERFORMANCE APPRAISAL METHODS


1. The Critical Incident File

The Critical Incident File is a performance appraisal method in which the manger
writes down positive and negative performance behavior of employees during their
employement period.this file is a form of documentation.



2. The Rating Scales

The Rating Scale is a form on which the manager simply checks off the employee's
level of performance. The possible eveluated areas include quantity of work, quality
of work, dependability, judgment, attitude, cooperation and initiative.

3. Behaviorally Anchored Rating Scales (BARS)

BARS is a method combining rating and critical incidents. Is is more objective and
accurate. Rather than having excellant, good, average. the form has several
statements that describe the employee's performance, from which the manager
selects the one that best describes the employee's performance for that task.

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4. Ranking

Ranking method is used to evaluate employee performance from bets to worst.
Under this method, the manager compare an employee to another employee, rather
than comparing each one to a standard measurement. A predetermined percentage
of employees are placed in performance categories for e.g excellent-5%,good-10%,
average-15%.

5. Management By Objectives (MBO)

MBO is a process in which managers and their employees jointly set objectives for
the employee, periodically evaluate the performance, and reward according to the
result

6. The Narrative Method

his method requires the manger to write a statement about the employee's
performance. Managers may be allowed to write whatever they want, or they may be
required to answer questions about employee's performance





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OBJECTIVES OF PERFORMANCE APPRAISALS

1. Objectives

o The main objective of performance appraisals is to measure and improve the
performance of employees and increase their future potential and value to the
company. Other objectives include providing feedback, improving communication,
understanding training needs, clarifying roles and responsibilities and determining
how to allocate rewards.

Provide Feedback

o The feedback received by the employee can be helpful in many ways. It gives insight
to how superiors value your performance, highlights the gap between actual and
desired performance and diagnoses strengths and weaknesses as wells as shows
areas for improvement.

o The method of performance appraisals helps superiors strengthen relationships and
improve communication with employees.

Training Needed

o These appraisals also identify the necessary training and development the employee
needs to close the gap between current performance and desired performance.

33


Clarify Expectations

o Performance appraisals should clarify roles, responsibilities and expectations of all
employees.

Allocate Rewards

o Performance appraisals reduce employee grievances by clearly documenting the
criteria used to make organizational decisions such as promotions, raises or
disciplinary actions.

Performance Appraisal Process


The performance appraisal process is a process that evaluates employee
performance. Normally it compares quality, quantity, cost, and time. Some of the
things that performance appraisal are used to do would be.
Give something tangible to the employee regarding their work performance.
Shows what training employees need.
Determines what the employees raise might be.

There are some other things that performance appraisals do, these are just some of
them.
34

There are some procedures that you should put in work at your work place. This will
help the employees know what you are expecting of them, and also establish a
standard within your work that everyone will be able to understand and follow. Some
of these things would be listed here.
Establishing performance standards
Communicate standards and expectations
Set up a system that measures actual performance
Compare employee with the standards implemented
Discuss results with employee
Make a decision on what you are going to do, or take corrective action.


Now as an employee, you should not get nervous when you hear anything about a
performance appraisal or review. As long as you have tried as hard as you can and
done everything in your capability to do your job duties, you can take what you hear
from you employer and use it to help yourself. You can take what your employer
tells you about the appraisal and use it to help you do your job better.
35


Now most Performance Appraisals are held annually, but it can be held whenever
your employer sees fit. Most companies hold their evaluations once a year because
they feel that it is too time consuming. Some feel that having it twice a year is better
because you can let the employee know if they are doing good, or if they are doing
something that they could do better you can tell them sooner then if it was help once
a year. One good idea is when you are doing the evaluations with the employees it
is really nerve racking for both the employee and for you. One good idea would be
to make your it is a private room and you can handle the evaluation without
interruption and where the employee can feel comfortable asking questions.

36


If you are an employer you can find many examples of great strategies in creating a
good performance appraisal process all over the Internet. There are many
companies that just make and implement these appraisals in your work place and
train your managers on how to give them out and will show you the best way to
teach your employees about what you are expecting from them.








37


TECHNIQUES OF PERFORMANCE APPRAISAL

.






38

nce a Year Overview


Self Appraisal


Performance Review - Preparation


Performance Review - The
Meeting

How to Complete a Performance
Appraisal Form

Analysis for Improving
Performance

Active performance appraisal
conversation



Performance appraisal feedback


Performance Consulting: Moving
Beyond Training

Writing performance appraisal


Performance Appraisal Training


How to Measure Employee
Performance

FAQ about Performance Appraisal















39

AIMS OF PERFORMANCE APPRAISAL

The following aims might be considered when examining a performance appraisal
system:
Use reliable,fair and objective measures of performance,compare actual with
planned performance,and provide feedback to appraise.
Make provision for the allocation of both extrinsic rewards (performance related pay)
and intrinsic rewards (opportunity to enhance ones skills) followingthe assessment
process.
Recognize that performance management is the heart of the general management
process.

E-PERFORMANCE MANAGEMENT
Performance management is another area which has been e based the use of
technology in performance management tends to increase productivity enhance
competitiveness and motivate employees this is possible through two ways
1-.technology may facilitate measuring an individuals performance via computer
monitoring activites,
2-technology become a tool to facilitate the process of writing reviews or generating
performance feedback.
This particular technological approach occurs more often in the context of jobs that
involves personal judgement and high discretion.
Technology can be applied in performance management in several ways.
In the first place routine or low discretion jobs can be subject to computerized
performance monitoring (cpm) system that helps generate performance data.
40

Second softwares are available that help generate appraisal forms and their
accompanying narrative.
Third,performance management system can be integrated with an overall enterprise
resourse planning(erp) software system.this approach helps hr professional to
identify high performers,spot skill and competency gaps and to analyse pay relative
to performance.with this information being available,hr manager can plan for
training,coaching and education.
Fourth,firm intranets and internet may also help performance-management process.
Fifth,stand alone software packages are great help in performance management
system.some of these packages are relatively inexpensive and easy to use the
greatest benefits of appraisal software are the elimination of paperwork and
simplification of the logistics for evaluators,works and administrators.

MECHANISM
The evaluation under cep consist of following steps:
1.appraiser does the rating after considering individual assessment parameters of
every employee.
2.scores are given against each assessment parameter of an individual in the rating
column on the basis of 5-point rating.
3.rating is reviewed with the reviewer.
4.total score is computed by adding all the scores.
5.the rating category corresponding to the appropriate range of total scores is
selected as overall final performance rating of employees from rating scale table.
41

6.the individual development form is filled by the appraise,which is further utilized for
training and development needs of employees,besides giving a direction to his/her
career growth in the organization.
7.after completing the appraisal,a constructive feedback should be given to the
appraise by the appraiser in presence of reviewer.
8.finally,contribution enhancement plan discusses rating for deciding upon the
performance rewards in the form of:
9.annual rewards
10.promotions
















42

CONTRIBUTION ENHANCEMENT PLAN

Contribution enhancement plan or cep is a process,which will enable organization to
improve organizational contribution through enhanced contribution of individual.it
aims to establish formal individual objectives and to review subsequent contribution
in order to reinforce successful behaviours,to correct shortfalls and to plan training
and development activities.the system will ensure that all management staff
employees are aware as to what is expected from them.this is a developmental plan
for the improvement in contribution of executives towards organizations or sbus
achievement of objectives and its development.it is categorized in to 2 parts:
-contribution enhancement plan(cep)A
-contribution enhancement plan(cep)B
Contribution enhancement plan (A) evaluates the contribution of an individual and
decides revision in fixed pay and contribution enhancement plan(B) is concerned
with variable pay.










43

Objectives of cep

1-to establish formal contribution standards.
2-to establish a system that is fact based and minimizes subjectivity in the
assessment of an individuals contribution.
3-it should provide constructive feedback for development of an employee.
4-enable the individual to evaluate his/her own areas of strengths and areas of
improvement for being a better manager.

Applicability of cep

1-the system is applicable to grade v and above employees of the company.
2-setting of 3 to5 bbos,which are measurable.
3-related to area /position in which employees operates.
4-evaluation of contribution and focus on employee development.


Business building objective (bbos)process

Business building objectives (bbos)are mutually agreed objectives between an
employee and his/her superior.these are tangible business targets,which are
measurable.
The first stage is for the person initiating the s identification and review processes
review cycleto understand the business plan so that there is clarity about the
44

direction and priorities of the organization.this will help ensure that individual bbos
support the overall business plan.


Bbo, identification and review processe

Bbos needed to be established the light of the annual business plan.the set
objectives must be relevant in context with each individual role.
The employees must prepare in advance his/her draft objectives for the next year
and contribution against objectives set for the past year.the same need to be carried
by the appraisee for discussion with the appraiser.the appraiser will also come
prepared with bbos(both past and future)for the employee.at the meeting they will
discuss the year ahead and seek agreement on various objectives.during the same
meeting they will also discuss the contribution against the past yea
Rs bbos.once the objectives for the next year are set and agreed upon the same
need to be communicated to the employee in writing.the employee shall be
evaluated against bbo during mid-year at the end of assessment year.
Bbos identification,assessment and review of contribution,assessment of traits and
skills training and development needs and plans will be joint responsibility if the
appraise and the appraiser.the reviewer needs to be satisfied that the key elements
of the process have done correctly.




45

APPRAISAL SYSTEM IN IFFCO
Set up of Zonal Office ,Lucknow
Zonal office

SET UP OF ZONAL OFFICE,
ZONAL OFFICE

SOS

UP BIHAR JHARKHAND
UTTARAKHAND
AOS AO AO AO
MEERUT PATNA DEOGHER HARIDWAR
SAHARANPUR GAYA RANCHI
DEHRADUN
MORADABAD MUZAFRPUR
BARELLY BENGLORE
LUCKNOW PURNEER
AGRA
JHASI
KANPUR
ALLAHABAD
FAIZABAD
VARANASI
GORAKHPUR
46

INDIAN FARMERS FERTILISERS CO-OPERATIVE LTD
Cadre-wise grade-wise count ofemployees

Grade
code
C1 D1 eo fo F1 go G1 G2 H1 H2 io jo J1 ko lo L1 m
o
qo tot
al
Cadre desc.
administration 1 1
Coordination/s
teno
5 5
Deo-cum-
assistant
4 6 1 2 2 1 16
Drivers 1 3 4 8
F&a 1 3 8 17 3 32
Helper(fsc) 16 16 3 1 36
marketing 1 2 8 25 34 12 11 1 15 14 1 12
4
Oa/safai
karam
4 3 3 10
Pers/ir 2 1 1 4
Power plant 1 1
Public
relations
1 1
salesman 16 28 8 5 8 1 1 67
47


Unit:253 UTTAR PRADESH run date:12/07/2011
16:04

















Security 1 1
Systems 1 1 2

Total: 1 2 9 30 45 34 35 2 50 1 17 40 1 13 22 1 4 1 30
8
48

BIHAR

Unit:213 BIHAR STATE run date:12/07/2011 16:04

Grade code D1 eo Fo F1 Go g1 H1 H2 io Jo J1 ko Lo L1 no total
Cadre desc.
Coordination/steno 1 1
Deo-cum-assistant 2 1 1 1 1 6
Drivers 1 1 2
F&a 1 4 4 9
marketing 1 2 10 8 5 1 4 4 2 37
Oa/safai karam 2 1 2 1 6
Pers/ir 1 1
Salesman 1 1
Systems 1 1

Total: 1 2 11 12 10 4 6 1 1 6 2 4 1 2 1 64








49

UTTARAKHAND

Unit:693 UTTARAKHAND STATE run
rate:12/07/2011 16:04
Grade code D1 eo fo F1 go G1 H1 io jo ko lo po total
Cadre desc.
administration 1 1
Coordination/steno 1 1
Deo-cum-assistant 1 1
F&a 1 1 1 3
Helper(fsc) 1 1 1 3
marketing 1 2 1 2 2 2 1 1 12
Oa/safai karam 1 1
Pers/ir 1 1
salesman 3 3
Total: 1 2 1 4 4 3 4 1 2 1 2 1 26









50


JHARKHAND

Unit:244 JHARKHAND STATE run
date:12/07/2011 16;04
Grade code eo Fo F1 go g1 H1 lo mo total
Cadre desc.
Coordination/steno 1 1
Deo-cum-assntista 1 1 1 3
F&a 1 1 1 3
marketing 1 1 3 2 2 9
Pers/ir 1 1
Total 1 1 4 2 2 5 1 1 17












51

DURATION
The revised pay structure will be valid for a period of ten years with effect from
01.01.2007 i.e. from 1.1.2007 to 31.12.2016 and shall continue to remain in force
until replaced by a fresh order.various benefits of this pay. revision will be effective
from the date(s).as mentioned under the respective headings.
PAY SCALES(OFFICER CATEGORY)
The existing scales of pay shall stand revised as under with effect from 1
st
January
2007.
GRADE PRE REVISED SCALE OF PAY REVISED SCALE OF PAY
(rs.) (rs.)
B 25750-650-30950 75000-100,000
B-1 23750-600-28550 70000-90,000
C 22500-600-27300 65000-80,000
C-1 21500-600-26300 60,000-75,000
D 20000-500-25000 51,300-73,000
E 18800-450-23900 43,200-66,000
F 17500-400-22300 38,000-62,000
F-1 16000-400-20800 35,000-58000
G 14500-350-18700 32,000-54,500
G-1 13500-350-18050 29000-50,500
G-2 10750-300-16750 23,000-46,500
H-1 9100-250-14600 20,000-40,500



52

FITMENT METHOD
The fitment method for fixing the basic pay in the revised scale in respect of officers
who were on the rolls of the society as on 31.12.2006 would be as under:
A. basic pay in the pre-revised scale as on 31/12/2006,plus.
B. Personal pay,if any as on 31/12/2006 which qualifies for the dearness allowance
and other allowances plus.
C. Dearness allowance at the rate 78.2% of pre-revised basic pay plus.
D. 30% of above (a,b,and c) as fitment benefit,plus.
E. Paradeep personal pay if any which does not qualify for any allowance.

PAY SCALES(WORKERS CATEGORY)
The existing scales of pay shall stand revised,as under with effect from 1
st

January,2007.

SN GRADE PRE REVISED SCALES OF
PAY(RS)
REVISED SCALES OF
PAY(RS)

MINIMUM MAXIMUM
1 H2 8200 220 12380 18500 32500
2 I 7600 210 11590 17000 29750
3 J 7100 175 10425 16000 28000
4 J1 6600 150 9450 15000 26250
5 K 6400 130 8870 14500 25500
6 L 6050 110 8360 13800 22200
7 L1 5650 100 7750 12800 20600
53

8 M 5300 90 7190 12000 19200
9 N 4900 80 6580 11000 17600
10 O 4100 70 5570 9500 15300
11 P 3300 50 4100 7500 12100
12 Q 2500 40 3140 6700 9300
13 R 1800 30 2280 4100 6700

FITMENT METHOD
The fitment method for fixing the basic pay in the revised scale in respect of
employees who were on the rolls of the society as on 31/12/2006 would be as under.
A. basic pay in the pre-revised scale as on 31/12/2006.plus.
B. personal pay if any as on 31/12/2006 which qualifies for the dearness
allowance and other allowances,plus.
C. Dearness allowance at the rate 78.2% of pre-revised basic pay plus.
D. 30% of above(a,b,and c) as fitment benefit plus.
E. Paradeep personal pay if any which does not qualify for any allowances.

POWERS AND GUIDELINES FOR WRITING ANNUAL APPRAISAL
REPORTS(AARS)

= the appraisal report must be complete in all respects before the 30
th
april of
every year for the preceding assessment year(ie.april to march).
= the lowest level of the reporting officer with reference to an appraisee shall be
as under:

54


APPRAISEE

(a) for employees in grade H2 and below- not below F1 grade.
(b) for officers in grade F1 and below-not below F grade.
(c) For officers in grade F and above-the immediate superior officer and above
in hierarchy.
(d) Md would be the reporting officer for the AARS of functional directors.
= the assessment of the reporting officer shall be reviewed by the next higher
authority in the hierarchy.in case the reviewing officer differs with the assessment
of the appraising officer.he should cite supporting data for the same. The AARS
of officers working in vigilance deptt. In units/division/head/zonal head/dy cvo as
the case may be and will be reviewed by cvo.
= the AARS in respect of officers having the overall rating of outstanding or
poorin grade h1 and and below shall be reviewed by sr ed/ed concerned and
accepted by functional director.out stading or poor ratings in respect of officers
in grade G2 and above shall be reviewed by by functional director and accepted
by md.
= caution should be exercised at all levels against the tendency to under rate or
over rate ,so as to b fair to the appraise and his colleagues in the organisation.
= poor rating will entail adverse remark and fair rating will call for improvement.
These should be brought to the notice of the concerned employee.fair report shall
be accepted by concerned director.
= the AARS in respect of employees in grade F and below shall be maintained
by the p&a deptts.of the concerned unit/division head office.the AARS in respect
55

of employees in grade e&d.shall be maintained in the office of director
(HRD).the AARS in respect of employees in grade C1 and above will be
maintained in mds office.
= the final accepting authorities for AARS shall be as under :-
APPRAISEE ACCEPTING AUTHORITY
(a) For H2 and below :- sectional/deptt head not below grade D.
(b) Grade H1to G : unit head in case of units.
: sr ed/ed/sr gm/gm,in case of ho & mkco
:for field staff,mkd.

:zonal head in case of mktg.

(C) grade F1 TO D : concerned functional director (excluding zms &
smms):mkd for marketing &marketing tpt/systems cadres.
:fd for fianc cadre.
: director (tech.) for technical cadre.
:darector (HRD) for p&a,vig.,security & hospital cadre.
= reports of officers in grade d,e,f & f, of transportation cadre & pr in units/mktg.
Will be reviewed by sr. Ed(tpt). And will be accepted by director (technical)/mkd
respectively.
= reports of officers in grade d,e,f,&f1 of systems in units/mktg.will be reviewed by
ed(msd&it) and will be accepted by director (technical) /mkd respectively.
=reports of executives in grade C1& above in f& a and p & a shall also be
reviewed by fd and dir.(HRD) respectively,before final acceptance by md.
56

JOB SATISFACTION

Job satisfaction describes how content an individual is with his or her job. The
happier people are within their job, the more satisfied they are said to be. Logic
would dictate that the most satisfied (happy) workers should be the best performers
and vice versa. This is called the "happy worker" hypothesis.However, this
hypothesis is not well supported, as job satisfaction is not the same as motivation or
aptitude, although they may be clearly linked. A primary influence on job satisfaction
is the application of Job design,which aims to enhance job satisfaction and
performance using methods such as job rotation, job enlargement, job enrichment
and job re-engineering. Other influences on satisfaction include management styles
and culture, employee involvement, empowerment, and autonomous work position.
Job satisfaction is a very important attribute and is frequently measured by
organizations. The most common technique for measurement is the use of rating
scales where employees report their thoughts and reactions to their jobs. Questions
can relate to rates of pay, work responsibilities, variety of tasks, promotional
opportunities, the work itself, and co-workers. Some examinations present yes-or-no
questions while others ask to rate satisfaction using a 1-to-5 scale, where 1
represents "not at all satisfied" and 5 represents "extremely satisfied."

Definition
Job satisfaction can simply be defined as the feelings people have about their jobs. It
has been specifically defined as a pleasurable (or unpleasurable) emotional state
resulting from the appraisal of ones job,an affective reaction to ones job, and an
57

attitude towards ones job. These definitions suggest that job satisfaction takes into
account feelings, beliefs, and behaviors.

History
One of the biggest preludes to the study of job satisfaction was the Hawthorne
studies. These studies (19241933), primarily credited to Elton Mayo of the Harvard
Business School, sought to find the effects of various conditions (most notably
illumination) on workers productivity. These studies ultimately showed that novel
changes in work conditions temporarily increase productivity (called the Hawthorne
Effect). It was later found that this increase resulted, not from the new conditions, but
from the knowledge of being observed. This finding provided strong evidence that
people work for purposes other than pay, which paved the way for researchers to
investigate other factors in job satisfaction.

Scientific management (aka Taylorism) also had a significant impact on the study of
job satisfaction. Frederick Winslow Taylors 1911 book, Principles of Scientific
Management, argued that there was a single best way to perform any given work
task. This book contributed to a change in industrial production philosophies, causing
a shift from skilled labor and piecework towards the more modern of assembly lines
and hourly wages. The initial use of scientific management by industries greatly
increased productivity because workers were forced to work at a faster pace.
However, workers became exhausted and dissatisfied, thus leaving researchers with
new questions to answer regarding job satisfaction. It should also be noted that the
work of W.L. Bryan, Walter Dill Scott, and Hugo Munsterberg set the tone for
Taylors work.
58

Some argue that Maslows hierarchy of needs theory, a motivation theory, laid the
foundation for job satisfaction theory. This theory explains that people seek to satisfy
five specific needs in life physiological needs, safety needs, social needs, self-
esteem needs, and self-actualization. This model served as a good basis from which
early researchers could develop job satisfaction theories.

Job satisfaction can also be seen within the broader context of the range of issues
which affect an individual's experience of work, or their quality of working life. Job
satisfaction can be understood in terms of its relationships with other key factors,
such as general well-being, stress at work, control at work, home-work interface, and
working conditions.

Models of Job Satisfaction
Affect Theory
Edwin A. Lockes Range of Affect Theory (1976) is arguably the most famous job
satisfaction model. The main premise of this theory is that satisfaction is determined
by a discrepancy between what one wants in a job and what one has in a job.
Further, the theory states that how much one values a given facet of work (e.g. the
degree of autonomy in a position) moderates how satisfied/dissatisfied one becomes
when expectations are/arent met. When a person values a particular facet of a job,
his satisfaction is more greatly impacted both positively (when expectations are met)
and negatively (when expectations are not met), compared to one who doesnt value
that facet. To illustrate, if Employee A values autonomy in the workplace and
Employee B is indifferent about autonomy, then Employee A would be more satisfied
in a position that offers a high degree of autonomy and less satisfied in a position
59

with little or no autonomy compared to Employee B. This theory also states that too
much of a particular facet will produce stronger feelings of dissatisfaction the more a
worker values that facet.

Dispositional Theory
Another well-known job satisfaction theory is the Dispositional Theory. It is a very
general theory that suggests that people have innate dispositions that cause them to
have tendencies toward a certain level of satisfaction, regardless of ones job. This
approach became a notable explanation of job satisfaction in light of evidence that
job satisfaction tends to be stable over time and across careers and jobs. Research
also indicates that identical twins have similar levels of job satisfaction.

A significant model that narrowed the scope of the Dispositional Theory was the
Core Self-evaluations Model, proposed by Timothy A. Judge, Edwin A. Locke, and
Cathy C. Durham in 1997. Judge et al. argued that there are four Core Self-
evaluations that determine ones disposition towards job satisfaction: self-esteem,
general self-efficacy, locus of control, and neuroticism. This model states that higher
levels of self-esteem (the value one places on his/her self) and general self-efficacy
(the belief in ones own competence) lead to higher work satisfaction. Having an
internal locus of control (believing one has control over her\his own life, as opposed
to outside forces having control) leads to higher job satisfaction. Finally, lower levels
of neuroticism lead to higher job satisfaction.

60

Opponent Process Theory
According to opponent process theory , emotional events, such as criticisms or
rewards, elicits two sets of processes. Primary processes give way to emotions that
are steady with the event in question. Events that seem negative in manner will give
rise to the feelings of stress or anxiety. Events that are positive give rise to the
feeling of content or relaxation. The other process is the opponent process, which
induces feelings that contradict the feelings in the primary processes. Events that are
negative give rise to feelings of relaxation while events that are positive give rise to
feelings of anxiety. A variety of explanations have been suggested to explain the
uniformity of mood or satisfaction. This theory shows that if you try to enhance the
mood of individual it will more likely fail in doing so. The opponent process theory
was formulated to explain these patterns of observations

Equity Theory
Equity Theory shows how a person views fairness in regard to social relationships.
During a social exchange, a person identifies the amount of input gained from a
relationship compared to the output, as well as how much effort another persons
puts forth . Equity Theory suggests that if an individual thinks there is an inequality
between two social groups or individuals, the person is likely to be distressed
because the ratio between the input and the output are not equal.
For example, consider two employees who work the same job and receive the same
benefits. If one individual gets a pay raise for doing the same or less work than the
other, then the less benefited individual will become distressed in his workplace. If,
on the other hand, one individual gets a pay raise and new responsibilities, then the
feeling of inequality is reduced
61

Discrepancy Theory
The concept of self-discrepancy theory explains the ultimate source of anxiety and
dejection. An individual, who has not fulfilled his responsibility feels the sense of
anxiety and regret for not performing well, they will also feel dejection due to not
being able to achieve their hopes and aspirations. According to this theory, all
individuals will learn what their obligations and responsibilities for a particular
function, over a time period, and if they fail to fulfill those obligations then they are
punished. Over time, these duties and obligations consolidate to form an abstracted
set of principles, designated as a self-guide. Agitation and anxiety are the main
responses when an individual fails to achieve the obligation or responsibility. This
theory also explains that if achievement of the obligations is obtained then the
reward can be praise, approval, or love. These achievements and aspirations also
form an abstracted set of principles, referred to as the ideal self guide. When the
individual fails to obtain these rewards, they begin to have feelings of dejection,
disappointment, or even depression

Two-Factor Theory (Motivator-Hygiene Theory)
Frederick Herzbergs Two factor theory (also known as Motivator Hygiene Theory)
attempts to explain satisfaction and motivation in the workplace This theory states
that satisfaction and dissatisfaction are driven by different factors motivation and
hygiene factors, respectively. An employees motivation to work is continually related
to job satisfaction of a subordinate. Motivation can be seen as an inner force that
drives individuals to attain personal and organizational goals (Hoskinson, Porter, &
Wrench, p. 133). Motivating factors are those aspects of the job that make people
want to perform, and provide people with satisfaction, for example achievement in
62

work, recognition, promotion opportunities. These motivating factors are considered
to be intrinsic to the job, or the work carried out. Hygiene factors include aspects of
the working environment such as pay, company policies, supervisory practices, and
other working conditions.

While Hertzberg's model has stimulated much research, researchers have been
unable to reliably empirically prove the model, with Hackman & Oldham suggesting
that Hertzberg's original formulation of the model may have been a methodological
artifact.Furthermore, the theory does not consider individual differences, conversely
predicting all employees will react in an identical manner to changes in
motivating/hygiene factors.Finally, the model has been criticised in that it does not
specify how motivating/hygiene factors are to be measured.

Job Characteristics Model
Hackman & Oldham proposed the Job Characteristics Model, which is widely used
as a framework to study how particular job characteristics impact on job outcomes,
including job satisfaction. The model states that there are five core job
characteristics (skill variety, task identity, task significance, autonomy, and feedback)
which impact three critical psychological states (experienced meaningfulness,
experienced responsibility for outcomes, and knowledge of the actual results), in turn
influencing work outcomes (job satisfaction, absenteeism, work motivation, etc.). The
five core job characteristics can be combined to form a motivating potential score
(MPS) for a job, which can be used as an index of how likely a job is to affect an
employee's attitudes and behaviors. A meta-analysis of studies that assess the
framework of the model provides some support for the validity of the JCM.
63

Factors that Influence Job Satisfaction
Environmental Factors
Communication Overload and Communication Underload
One of the most important aspects of an individuals work in a modern organization
concerns the management of communication demands that he or she encounters on
the job.Demands can be characterized as a communication load, which refers to the
rate and complexity of communication inputs an individual must process in a
particular time frame. Individuals in an organization can experience communication
over-load and communication under- load which can affect their level of job
satisfaction. Communication overload can occur when an individual receives too
many messages in a short period of time which can result in unprocessed
information or when an individual faces more complex messages that are more
difficult to process. Due to this process, given an individuals style of work and
motivation to complete a task, when more inputs exist than outputs, the individual
perceives a condition of overload which can be positively or negatively related to job
satisfaction. In comparison, communication under load can occur when messages or
inputs are sent below the individuals ability to process them. According to the ideas
of communication over-load and under-load, if an individual does not receive enough
input on the job or is unsuccessful in processing these inputs, the individual is more
likely to become dissatisfied, aggravated, and unhappy with their work which leads to
a low level of job satisfaction.
Superior-Subordinate Communication
Superior-subordinate communication is an important influence on job satisfaction in
the workplace. The way in which subordinates perceive a supervisor's behavior can
positively or negatively influence job satisfaction. Communication behavior such as
64

facial expression, eye contact, vocal expression, and body movement is crucial to
the superior-subordinate relationship (Teven, p. 156). Nonverbal messages play a
central role in interpersonal interactions with respect to impression formation,
deception, attraction, social influence, and emotional.Nonverbal immediacy from the
supervisor helps to increase interpersonal involvement with their subordinates
impacting job satisfaction. The manner in which supervisors communicate with their
subordinates non-verbally may be more important than the verbal content (Teven,
p. 156). Individuals who dislike and think negatively about their supervisor are less
willing to communicate or have motivation to work whereas individuals who like and
think positively of their supervisor are more likely to communicate and are satisfied
with their job and work environment. A supervisor who uses nonverbal immediacy,
friendliness, and open communication lines is more likely to receive positive
feedback and high job satisfaction from a subordinate. Conversely, a supervisor who
is antisocial, unfriendly, and unwilling to communicate will naturally receive negative
feedback and create low job satisfaction in their subordinates in the workplace.
Individual Factors
Emotion
Mood and emotions form the affective element of job satisfaction. Moods tend to be
longer lasting but often weaker states of uncertain origin, while emotions are often
more intense, short-lived and have a clear object or cause.
Some research suggests moods are related to overall job satisfaction.Positive and
negative emotions were also found to be significantly related to overall job
satisfaction
Frequency of experiencing net positive emotion will be a better predictor of overall
job satisfaction than will intensity of positive emotion when it is experienced.
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Emotion work (or emotion management) refers to various types of efforts to manage
emotional states and displays. Emotion management includes all of the conscious
and unconscious efforts to increase, maintain, or decrease one or more components
of an emotion. Although early studies of the consequences of emotional work
emphasized its harmful effects on workers, studies of workers in a variety of
occupations suggest that the consequences of emotional work are not uniformly
negative.
It was found that suppression of unpleasant emotions decreases job satisfaction and
the amplification of pleasant emotions increases job satisfaction.The understanding
of how emotion regulation relates to job satisfaction concerns two models:
1. Emotional dissonance. Emotional dissonance is a state of discrepancy
between public displays of emotions and internal experiences of emotions,
that often follows the process of emotion regulation. Emotional dissonance is
associated with high emotional exhaustion, low organizational commitment,
and low job satisfaction.
2. Social interaction model. Taking the social interaction perspective, workers
emotion regulation might beget responses from others during interpersonal
encounters that subsequently impact their own job satisfaction. For example:
The accumulation of favorable responses to displays of pleasant emotions
might positively affect job satisfaction.
Genetics
It has been well documented that genetics influence a variety of individual
differences.Some research suggests genetics also play a role in the intrinsic, direct
experiences of job satisfaction like challenge or achievement (as opposed to
extrinsic, environmental factors like working conditions). One experiment used sets
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of monozygotic twins, reared apart, to test for the existence of genetic influence on
job satisfaction. While the results indicate the majority of the variance in job
satisfaction was due to environmental factors (70%), genetic influence is still a minor
factor. Genetic heritability was also suggested for several of the job characteristics
measured in the experiment, such as complexity level, motor skill requirements, and
physical demands.
Personality
Some research suggests an association between personality and job satisfaction.
Specifically, this research describes the role of negative affectivity and positive
affectivity. Negative affectivity is related strongly to the personality trait of
neuroticism. Individuals high in negative affectivity are more prone to experience less
job satisfaction. Positive affectivity is related strongly to the personality trait of
extraversion. Those high in positive affectivity are more prone to be satisfied in most
dimensions of their life, including their job. Differences in affectivity likely impact how
individuals will perceive objective job circumstances like pay and working conditions,
thus affecting their satisfaction in that job.
Measuring Job Satisfaction
There are many methods for measuring job satisfaction. By far, the most common
method for collecting data regarding job satisfaction is the Likert scale (named after
Rensis Likert). Other less common methods of for gauging job satisfaction include:
Yes/No questions, True/False questions, point systems, checklists, and forced
choice answers. This data are sometimes collected using an Enterprise Feedback
Management (EFM) system.
The Job Descriptive Index (JDI), is a specific questionnaire of job satisfaction that
has been widely used. It measures ones satisfaction in five facets: pay, promotions
67

and promotion opportunities, coworkers, supervision, and the work itself. The scale
is simple, participants answer either yes, no, or cant decide (indicated by ?) in
response to whether given statements accurately describe ones job.
A related scale is the Job in general index, which asks employees how satisfying
their job is in a broad overall sense. In certain situations, it can be more useful than
the JDI because rather than focusing on individual facets, it asks about work
satisfaction in general.
Other job satisfaction questionnaires include: the Minnesota Satisfaction
Questionnaire (MSQ), the Job Satisfaction Survey (JSS), and the Faces Scale. The
MSQ measures job satisfaction in 20 facets and has a long form with 100 questions
(five items from each facet) and a short form with 20 questions (one item from each
facet). The JSS is a 36 item questionnaire that measures nine facets of job
satisfaction. Finally, the Faces Scale of job satisfaction, one of the first scales used
widely, measured overall job satisfaction with just one item which participants
respond to by choosing a face..
Relationships and Practical Implications
Job Satisfaction can be indicative of work behaviors such as organizational
citizenship, and withdrawal behaviors such as absenteeism, and turnover.Further,
job satisfaction can partially mediate the relationship of personality variables and
deviant work behaviors.
One common research finding is that job satisfaction is correlated with life
satisfaction.This correlation is reciprocal, meaning people who are satisfied with life
tend to be satisfied with their job and people who are satisfied with their job tend to
be satisfied with life. However, some research has found that job satisfaction is not
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significantly related to life satisfaction when other variables such as nonwork
satisfaction and core self-evaluations are taken into account.
An important finding for organizations to note is that job satisfaction has a rather
tenuous correlation to productivity on the job. This is a vital piece of information to
researchers and businesses, as the idea that satisfaction and job performance are
directly related to one another is often cited in the media and in some non-academic
management literature. A recent meta-analysis found surprisingly low correlations
between job satisfaction and performance.Further, the meta-analysis found that the
relationship between satisfaction and performance can be moderated by job
complexity, such that for high-complexity jobs the correlation between satisfaction
and performance is higher than for jobs of low to moderate complexity. Additionally,
one longitudinal study indicated that among work attitudes, job satisfaction is a
strong predictor of absenteeism, suggesting that increasing job satisfaction and
organizational commitment are potentially good strategies for reducing absenteeism
and turnover intentions. Recent research has also shown that intention to quit alone
can have negative effects on performance, organizational deviance, and
organizational citizenship behaviours. In short, the relationship of satisfaction to
productivity is not as straightforward as often assumed and can be influenced by a
number of different work-related constructs, and the notion that "a happy worker is a
productive worker" should not be the foundation of organizational decision-making.
For example, employee personality may even be more important than job
satisfaction in regards to performance
Job satisfaction: How to make work more rewarding
Stress mounts when job satisfaction falls flat. Here's a look at the underlying causes
of job dissatisfaction and practical ways to boost job satisfaction.
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By Mayo Clinic staff
Do you find yourself dreading the start of the workweek? Or wishing the workday
away? Are you no longer enthusiastic about your job? In a challenging economy, you
may not feel that you can "vote with your feet" and simply change jobs but you
might be able to change how you think about your job to improve your job
satisfaction.
Understand the link between work approach and job satisfaction
If you've gone sour on your job, take some time to think about what motivates and
inspires you and how you approach your work. For example:
It's a job. If you approach work as a job, you focus primarily on the financial
rewards. The nature of the work may hold little interest for you. What's
important is the money. If a job with more pay comes your way, you'll likely
move on.
It's a career. If you approach work as a career, you're likely interested in
advancement. You may want to climb the career ladder as far as possible or
be among the most highly regarded professionals in your field. You're
motivated by the status, prestige and power that come with the job.
It's a calling. If you approach your job as a calling, you focus on the work
itself. You're less interested in financial gain or career advancement,
preferring instead to find a sense of fulfillment from the work itself.
One approach isn't necessarily better than the others, and you might find elements of
all three perspectives important. Still, if you're unsatisfied with your job, it's helpful to
reflect on why you work. Think about what originally drew you to your current job,
and whether it may be a factor in your lack of job satisfaction.

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PERFORMANCE APPRAISAL CORELATION WITH JOB
SATISFACTION

Performance appraisal are viewed as a vital human resource management issue
where it consists of two salient features: motivational motive and punishment motive.
The ability of appraisers (e.g., immediate bosses/managers) to properly implement
such appraisal in allocating performance ratings may have significant impact on job
satisfaction. Although the nature of this relationship is important, little is known about
the role of performance appraisal as a predicting variable in the performance
appraisal models. Therefore, this study was conducted to examine the effect of
performance appraisal politics job satisfaction using 150 usable questionnaires
gathered from employees who have worked in a national postal company in
Sarawak, Malaysia. In initial data analysis, the results of exploratory factor analysis
confirmed that the measurement scales used in this study satisfactorily met the
standards of validity and reliability analyses. Further, in hypothesis testing, the
outcomes of stepwise regression analysis showed that performance appraisal (i.e.,
motivational motive and punishment motive) significantly correlated with job
satisfaction. Statistically, this result confirms that performance appraisal
act as important predictors of job satisfaction in the studied organization. In addition,
discussion, implications and conclusion are elaborated.





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RESEARCH AND METHODOLOGY

Research is an organized inquiry designed and carried out to provide information to
solve the problem. The fact,search is an art of scientific investigation of a certain
problem.research is the process of systematically obtaining accurate answers to
significant and pertinent questions by the use of the scientific methods gathering and
interpreting information.
a. SAMPLE SIZE:
sample size is 50. Data was analyzed by surveying employees from different
departments.
b. SAMPLE DESIGN:
this part is done through discussing and analyzing with my project guide and
referring to the subject regarding this topic.it was a random sampling.
c. MODE OF ANALYSIS:
The methods used to analyze the data are as follows:
1. To study the importance of performance appraisal in the organization.
2. To find out whether the employees are satisfied with the present performance
appraisal system or not.
3. Interpret and analysis of the data and present it in a proper manner.
4. Uses of Microsoft excel for preparation of graph.





72

OBJECTIVE OF THE STUDY

1. to study the performance appraisal system in the organization.
2. To find out how the performance of employees is assessed.
3. To review how the performance appraisal system helps in
placement,selection,promotion and transfer of the employees.
4. To find out the problems faced by the staff in preparing their BBOS (BUSINESS
BUILDING OBJECTIVE).
5. To offer suggestions and recommendation regarding the existing performance
appraisal system in the company.















73

LIMITATIONS OF PERFORMANCE APPRAISAL

1. the opinion of staff and manager are often in opposition,causing de-
motivation.
2. The process is usually manager driven and the staff member is expected to
be compliant in the interview.
3. The process usually involves manager giving their opinion and the staff
member having to defend the position,rather than a positive discussion.
4. There is no room for remedial action during the year.
5. The process is usually done in a rushed manner to meet the budget
development process and therefore loses its relevance to performance.














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ANALYSIS AND INTERPRETATION

QUE 1. Do you think that performance appraisal is essential for the employees of
the company?
(a)fully
(b)partially
(c)not at all

ANALYSIS AND INTERPRETATION

It shows 80% of the employees agree that performance appraisal is essential for the
employees of the company and 20% of the employees partially agree.
Currently annual appraisal system in iffco is carried out for the employees at
executive levels and above only.the target set may be reviewed quarterly so that
strengths and weaknesses,if any,can be assesses and remedial measures
suggested accordingly.

(a)fully
(b)partially
(c)not at all
75

QUE 2.do you think so,that performance appraisal has been described as the
responsibility,which is not liked by the superiors.
(A)yes
(B)partially
(C)not at all

ANANLYSIS AND INTERPRETATION
46% executives say that they consider performance appraisal as the responsibility
they liked the least.27% executives agree that it is a responsibility not liked by them
and remaining 27% denies about any such probability.
Considerable amount of time is spent for getting the appraisals done as per the
existing system.the company should improve the existing system by designing and
implementing departmental performance review system on a quarterly basis





(a)fully
(b)partially
(c)not at all
76

QUE3.do you agree that self-appraisal prior to performance appraisal facilitates you
to get high rating?
(a)completely
(b)partially
(c)not at all.



ANALYSIS AND INTERPRETATION
45.5% of the employees say partially self appraisal facilitates to get high
ratings,27.3% employees agree completely and other 27.2% say self-appraisal does
not help in high ratings in performance appraisal.
Many companies (eg.britannia) have implemented the self appraisal system.this
has proved helpful in identifying the needs for in-house group
discussions/counselling methods/training and development programs.



(a)fully
(b)partially
(c)not at all
77

QUE 4.does your supervisor give you effective feedback on a regular basis?
(a)yes
(b)depend on the employees
(C)not at all.

ANALYSIS AND INTERPRETATION
It is clear that 100% of the employees say that the superior gives them effective on a
regular basis.
Any company should give feedback to the employees periodically they can also
extend proper diagnostic tips/counselling methods at the required level.








(a)fully
(b)partially
(c)not at all
78

QUE5.do you think that performance appraisal is a good method for improving
employees performance level?
(A)to a great extent
(B)to some extent
(C)not at all

ANALYSIS AND INTERPRETATION
74% employees agree that up to a great extent,18% say that to some extent and 8%
of the employees believe performance appraisal not at all improves performance
appraisal.
Currently the companys existing appraisal system is on annual basis.this may be
reviewed on a quarterly basis,which will help in assessing the strengths and
weaknesses of executives and role modifications can be suggested accordingly.





(a)fully
(b)partially
(c)not at all
79

QUE6.do your co-workers and superiors help you to cope up ith your poor
performance?
(A)to a great extent
(B)to some extent
(C)not at all

ANALYSIS AND INTERPRETATION
55% of the employees say up to great extent their co-workers and superiors help
them to cope up with their poor performance and 45%say to some extent.
Iffco can also concentrate on designing and implementing proper in-house
counselling program through group discussions/personal interaction.







(a)fully
(b)partially
(c)not at all
80

QUE7.is your superior partial with you in deciding your rank?
(A)yes
(b)no


ANALYSIS AND INTERPRETATION

95% employees say yes and 5% employees say no. so superior should not partial
with their employee because its effect their company promotions.due to poor rating
some good employee can not take promotions and cant contribute the success of
the company.







(a)fully
(b)partially
81

QUE8.. How do you feel the working environment ?
a) excellent
b) good
c)satisfactory not satisfactory


ANALYSIS AND INTERPRETATION
80% employees feel good their working enviorment and 20% feel satisfactory their
working enviournment because they think they can get more benefit for their work.









(a)fully
(b)partially
(c)not at all
82

QUE9. Opinion about your job
a) highly satisfied
b) satisfied
c) others (specify) ..
d) not satisfied

ANALYSIS AND INTERPRETATION
95%employees satisfied for their job and 5% employees not satisfied for their
job.because they think according to their work they should get promotionbut their
senior dont think so.








(a)fully
(b)partially
(c)not at all
83

QUE10.My manager/supervisor provides me with continuous feedback to help me
achieve
a)strongly disagree
b)disagree
c)somewhat agree
d)agree
e)strongly agree



ANALYSIS AND INTERPRETATION
90% employees strongly agree but 10% employee disagree because they think their
supervisior are doing partiality.they support only their favourate employee.





(a)fully
(b)partially
(c)not at all
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SUMMARY OF FINDINGS

= Presently,iffco is following annual appraisal system for employees at the executive
and the above level.the target may me reviewed on a quarterly basis.
= Time is a crucial factor.company can delegate the responsibility to employees by
desiging and implementing performance review system on a quarterly basis.
= superiors should give feedback to employees periodically.they can also provide
proper diagnostic tips/counselling methods at required level.
= iffco has an existing system on annual basis.they can review on quarterly basis.
= iffco can endorse proper diagnostic mapping for role modifications/training and
development needs.
= company can also involve organizational planning and development department to
achieve its mission and goals.
= for the merit raise,HR should introduce system for proper recognition rewards to
such employees.
= company should mainly concentrate on in-house counselling program through
group discussions/personal interaction for the better performance of employees.
= competency skills should be assessed and effective role modifications areas can
be suggested for the better progress of the company.






85

RECOMMENDATIONS

= in order to have a better liaison within the co-workers and their superiors the
company should have a well-planned communication system and employeesviews
should be taken in to considertation.
= while working under pressure the employees performance is affected so it
becomes necessary that the management should try to analyze the strengths and
weaknesses of the employees.
= teamwork should be assigned to employees,which will be helpful in establishing
leadership qualities and also becoming aware of others problems.
= employees should be given proper training and development programs to learn
new concepts and technologies as to expand their capabilities,knowledge,skills etc.













86

CONCLUSION

In the new millennium when the corporate world is designing newer techniques for
developing employees and retaining them,iffco is no way behind and the
organizational structure is such that people works hand in hand to align the
organizational goals with the individuals goals.

Evaluation of employees performance is helpful as to strengthen the employees
productivity,their promotion ,transfer and development needs etc.the organization
has implemented the evaluation process not only to evaluate the performance of
employees but also for their increment and promotion.the company follows a
transparent performance performance appraisal system with no personal bias
because it is wholly based on individualscontribution towards the organization.but
there are some loopholes in the system that should be analyzed and corrective
measures should be taken.

To sum it up,this project has provided me with opportunities to learn different areas
of the HR function and has given me stepping-stones to climb up to reach the
summit of HR at the end of my career.






87

BIBLIOGRAPHY
For the purpose of this study,some broad sources of literature were referred to:
Textbooks
1. Human resource and personnel management-by k.ashwathappa
2. The essence of human resource management-by Eugene mc keena
3. Organizational theory-by gareth jones
4. Organizational behaviour-by Stephen robbins

Magazines and newspapers
1. The economic times
2. The week

Internet portals
= www.iffco.nic.in
=www.google.com
=www.humanresourcesmagazine.com.