A

PROJECT REPORT
ON
PERFORMANCE APPRAISAL

IN PARTIAL FULLFILLMENT FOR THE DEGREE OF MASTER OF BUSINESS

ADDMINISTRATION

(SESSION – 2009-2011)

SUBMITTED TO

MAHARISHI DAYANAND UNIVERSITY ,ROHTAK

Supervised By: Submitted By:

Mrs. SAPNA DADWAL PAWAN KUMAR

Faculty of MBA, GITM ROLL NO.- 09-MBA-132

GURGAON INSTITUTE OF TECHNOLOGY & MANAGEMENT

BILASPUR, GURGAON
 CONTENTS

Preface

Declaration

Acknowledgement

Chapter-I Introduction (Conceptual Framework) 1-19

Introduction 1
Significance of the Study 15
Company Profile 16
Focus of the Study

Chapter-II Literature Review 20-24

Chapter-III Research Methodology 25-28

• Objective of the study 26

• Scope of the Study

• Research Design

• Sample Size and Technique 27

• Data Collection method 27

• Limitation of the study 28

Chapter-IV Data Analysis and Interpretation 29-39

Chapter-V Conclusions & Suggestion 40-43

 Chapter-VI Appendix & bibliography 44-48

PREFA
CE

True learning is born out of experience and observation practical experience is one of the best
types of leanings that one can remember throughout the life. After III semesters in learning
theoretical aspects of administration and management, the day come to apply these in
corporate world in content of modern industrial enterprise that has to go through its different
terminal to achieve that corporate goals. The main object of practical training is to develop
practical knowledge and experience and awareness about industrial environment and business
practices in the student as a supplement to theoretical studies of administration and
management in specific area like HRM. It increases the skill, ability and attitude of a student
to perform specific job in industrial environment.

Fortunately, I got golden opportunity to visit at THE LUMAX. Here, I got chance to see the
functioning HRD departments and imbibe a lot learning of the subjects.
 DECLARATION

I PAWAN KUMAR, Roll no.09-MBA-132, Class MBA 4TH SEM. Of the GITM

here by declare that the project entitled “ PROJECT REPORT ON PERFORMANCE

APPRASAIL” is an original work and the same has not been submitted to any other institute
for the award of any other degree,the interim report was presented to the supervisor on 4 th
apriland the pre submission presentation was made on 11th april 2011.The feasible suggestion
have been duly incorporated in consultation with the supervisor

Countersigned

Signature of the Supervisor Signature of the candidate

Forwarded by

Director /principle of the institute

 ACKNOWLEDGEMENT

I would like to thank all those people who helped and provided their support and to
complete this Training Report successfully.

We are thankful to Mr. P.k. Sharma (Executive Director) LUMAX for

Giving me the permission to carry out the project in the organization.

I am thankful to Mr. L.m.. Yadav (Manager Personnel), and all the employees of

LUMAX for giving me their valuable time.

I also thank PROF.NARENDER KUMAR (HOD)and MRS.SAPNA DADWAL(SR.LECT.)

for giving me their valuable time.

(PAWAN KUMAR)
 CHAPTER-1
INTRODUCTION
INTRODUCTION

This report was made during the summer vacation after the end of the II semester at GITM.
This duration is also said as the training period for us. During the summer training I had gone
to Bhiwadi in Lumax.

I had completed my training with Human Resource Management also known as Personnel
Department. I had chosen this topic because I wanted to know that how a company works and
while working with personnel department I find that the desire of my heart was fulfilled
because I was able to know the company in a better way.

Secondly I had chosen my topic, which consists of Performance Appraisal , which is directly
related to company’s performance and the workers performance respectively.

PERFORMANCE APPRAISAL

Performance appraisal is the process of obtaining, analyzing and recording information about
the relative worth if an employee. The focus of the performance appraisal is measuring and
improving the actual performance of the employee and also the future potential of the
employee. Its aim is to measure what an employee does.

According to Flippo, a prominent personality in the field of Human resources, “performance

appraisal is the systematic, periodic and an impartial rating of an employee’s excellence in the
matters pertaining to his present job and his potential for better job.” Performance appraisal is
a systematic way of reviewing and assessing the performance of an employee during a given
period of time and planning for his future.

It is a powerful tool to calibrate, refine and reward the performance of the employee. It helps
to analyze his achievements and evaluate his contribution towards the achievement of the
overall organizational goals.

By focusing the attention on performance appraisal goes to the heart of personnel

management and reflects the management’s interest in the progress of the employees.

People differ in their abilities and their aptitudes. There is always some difference between
the quality of the same work on the same job being done by two different people. Therefore,
performance management and performance appraisal is necessary to understand each
employee’s abilities, competencies and relative merit and worth for the organization.
Performance appraisal rates the employees in terms of their performance.

Performance appraisals are widely used in the society. The history of performance appraisal
can be dated back to the 20th century and then to the Second World War when the merit rating
used for the first time. An employer evaluating their employees is a very old concept.
Performance appraisals are an indispensable part of performance measurement.

Performance appraisal is necessary to measure the performance of the employees and the
organization to check the progress towards the desired goals and aim.

The latest mantra being followed by organizations across the world being –“get paid
according to what you contribute” – the focus of the organizations is turning performance
management and specially to individual performance. Performance appraisal helps to rate the
performance of the employees and evaluate their contribution.

Towards the organizational goals. If the process of performance appraisal is formal and
properly structured, it helps the employees to clearly understand their roles and
responsibilities and give direction to the individual’s performance. It helps to align the
individual performance with the organizational goals and also review their performance.

Performance Appraisal takes into account the past performance of the employees and focuses
on the improvement of the future performance of the employees. Here at naukrihub, we
attempt to provide an insight into the concept of performance appraisal, the methods and
approaches of performance appraisal, sample performance appraisal forms and the appraisal
software’s available etc. An attempt has been made to study the current global trends in
performance appraisal.
OBJECTIVE OF Performance appraisal :

• To review the performance of the employees over a given period of time.

• To judge the gap between the actual and the desired performance.

• To help the management in exercising organizational control.

• Helps to strengthen the relationship and communication between superior –

subordinates and management – employees.

• To diagnose the strengths and weaknesses of the individuals so as to identify the

training and development needs of the future.

• To provide feedback to the employees regarding their past performance.

• Provide information to assist in the other personal decisions in the organization.

• To provide clarity of the expectations and responsibilities of the functions to be

performed by the employees.

• To judge the effectiveness of the other human resources functions of the organization
such as recruitment, selection, training and development.
APPROACHES TO PERFORMANCE DEVELOPMENT

Performance appraisal – Traditional approach

Traditionally, performance appraisal has been used as just a method for determining and
justifying the salaries of the employees. Than it began to be used a tool for determining
rewards (a rise in the pay) and punishment (a cut in the pay) for the past performance of the
employees.

This approach was a past oriented approach, which focused only on the past performance of
the employees i.e. during a past – specified period of time. This approach did not consider the
development needs or career developmental possibilities. The primary concern of the
traditional approach is to judge the performance of the organization as a whole by the past
performances of its employees.

Therefore, this approach is also called as the overall approach. In 1950’s the performance
appraisal was recognized as a complete system in itself and the Modern Approach to
performance appraisal was developed.

Performance appraisal – Modern approach

The modern approach to performance development has made the performance appraisal
process more formal and structured. Now, the performance appraisal is taken as a tool to
identify better performing employees from others, employees training needs, career
development paths, rewards and bonuses and their promotions to the next levels.

Appraisal have become a continuous and periodic activity in the organizations. The results of
performance appraisals are used to take various other HR decisions like promotions,
demotions, transfers, training and development, reward outcomes. The modern approach to
performance appraisals includes a feedback process that helps to strengthen the relationship
between superiors and subordinates and improves communication throughout the
organization.

The Modern approach to performance appraisal is a future oriented approach and is

developmental in nature. This recognizes employees as individuals and focuses on their
development.
CHALLENGES OF PERFORMANCE APPRAISAL

In order to make a performance appraisal system effective and successful, an organization

comes across various challenges and problems. The main challenges involved in the
performance appraisal process are :

o Lack of competence

Top management should choose the raters or the evaluators carefully. They should
have the required expertise and the knowledge to decide the criteria accurately. They
should have the experience and the necessary training to carry out the appraisal
process objectively.

o Errors in rating and evaluating

Many errors based on the personal bias like stereotyping, halo effect (i.e. one trait
influencing the evaluator’s rating for all other traits) etc. may creep in the appraisal
process. Therefore the rater should exercise objectivity and fairness in evaluating and
rating the performance of the employees

o Resistance

The appraisal process may face resistance from the employees and the trade unions for
the fear of negative ratings. Therefore, the employees should be communicated and
clearly explained the purpose as well the process of appraisal. The standards should be
clearly communicated and every employee should be made aware that what exactly is
expected from him/her.
PERFORMANCE ASSESSMENT GUIDELINES

1) Self-Assessment

All Appraises will make a Self-Assessment of their own performance and fill in the
following information in the Performance Assessment Worksheet:

S. No. Term Description

1. Key Result Area (KRA) These are critical functions of a job. Performance
with respect to defined KRAs lead to distinct
contributions/ outcomes towards organizational
objectives.

2. Measure(s) These are yardsticks for evaluating the extent of

performance with respect to a KRA. A particular
KRA may have more than one Measure.

3. Performance Standard This is a specific goal corresponding to the

Measure of a KRA and should preferably be
realistic, achievable and time-bound.

4. Weight age (%) This demonstrates the relative importance of the

KRA in terms of the priority and effort and
should add up to 100%. The minimum Weight
age is 10%

5. Extent of Over-/ Under- To what extent the Performance Standards were

achievement (with met and description about the causes of /factors
elaboration) responsible for Over/ Under-Achievement.

2) Performance Assessment Discussion

 This candid discussion between the Appraiser and the Appraisee on the latter’s
performance during the year should focus on the following aspects:

• Demonstration of the extent of performance by the employee in the objective

terms.
• Identifying the key drivers and facilitators for performance.
• Reviewing and discussing performance bottlenecks and making plans to overcome
them.
• Planning of KRAs, Measures and Performance Standards for the next year.

3) Assessment by Appraiser

Post discussion with the employees, the Appraiser will fill in the following information:

Comments of Appraiser This will include specific observations/ remarks relevant

to the Assessment of the Appraisee, or any other Job-
related aspect.

Assessed Level The Performance Level of an Appraisee for each of his/her

KRAs as well as the Overall Performance ( for the Job as
a whole) will be as per table below.

Definition of Level
Assessed Description of Typical %
Level Level Achievement KRA Performance Overall Performance
of Results
 Performance exceeds
Expectation, consistently
DE Demonstrates Greater than Achieving challenging and
Overall performance exceeds all
Excellence 120% Stretch goals and meets Job expectations and is “visible”
Industry/ organizational Across the organization.
Standards of excellence.

EE Exceeds Between Performance exceeds Overall Performance exceeds all

Expectations 100% to 120%Expectations in all respects.
Job expectations and is “visible”
Across the Department/
Function/ Location.

ME Meets Between Performance meets Overall Performance

Expectations 85% to 100% Expectations. Demonstrated meets all job
Expectations.

NI Needs Less than Performance only partially

Overall Performance only
Improvement 85% Meets expectations and Partially meets job expectations
Needs improvement. And improvement is needed.

SME Short of Poor or Performance demonstrated

Overall performance
Minimum Insignificant Falls short of minimum Demonstrated falls short of
Expectations Results Expectations. Minimum job expectations.

4) Performance Review

The Appraiser will forward the Worksheet duly assessed and completed by him/her to the
Reviewer (the immediate supervisor of the Appraiser) for his/her review and validation.
Based on discussion with the Reviewer, the Assessed Level of Overall Performance for
the employee will be documented in the Worksheet (based on the guidelines in the above
table).
The reviewer and the appraiser shall document their overall comments relating to the
assessment of employee and sign off at respective places in the worksheet.

5) Performance Calibration Process

After the completion of performance review, the Overall Performance as assessed will be
taken through the Performance Calibration Process by the Functional Directors. This
process would aim at reviewing performance levels across the functional area and apply
necessary changes in line with structured guidelines, if any.

Performance level Distribution guidelines:

Assessed DE EE ME NI SME
Level

% of 10% 25% 50% 10% 5%

Head
Count

PURPOSE OF PERFORMANCE APPRAISAL

Performance appraisal is being practiced in 90% of the organizations worldwide
appraisal and potential appraisal also form a part of the performance appraisal
purpose.

Typically, Performance Appraisal is aimed at:

o To review the performance of the employees over a given period of time.

 o To judge the gap between the actual and the desired performance.

o To help the management in exercising organizational control.

o To diagnose the training and development needs of the future.

- Provide information to assist in the HR decisions like promotions transfers

etc.

- Provide clarity of the expectations and responsibilities of the function

performed by the employees.

- To judge the effectiveness of the other Human Resource function of

organization such as recruitment, selection, training and development.

- To reduce the grievances of the employees.

Helps to strengthen the relationship and communication between superior –

subordinates and management – employees.

PERFORMANCE APPRAISAL FOR EMPLOYEES AT

DIFFERENT LEVELS

Performance appraisal is important for employees at all levels throughout the

organization. The parameters, the characteristics and the standards for evaluating may be
different, but the fundamentals of performance appraisal are the same. But as the level of the
employees’ increases, performance appraisal is more effectively used as the tools of managing
performance.
PERFORMANCE APPRAISAL OF MANAGERS:

Appraising the performance of managers is very important, but at the same time, it is one of
the most difficult tasks in the organization. It is difficult because most of the managerial work
cannot be quantified i.e. it is qualitative in nature like leading his/her team, guiding,
motivating, planning etc.

Therefore, the two things to be noted and evaluated for the purpose of appraisals are:

• Performance in accomplishing goals, and

• Performance as managers

Performance in accomplishing goals is

Managers are responsible for the performance of their teams as a whole. Performance in
accomplishing goals would mean to look at the completion or achievement of the goals set for
a team of employees which is being assigned to or working under a particular manager. The
best measuring criteria for a manager are high goals, his plans of course of action to achieve
them and the extent of achievement of the goals.

Performance as managers

The responsibilities of managers include a series of activities, which are concerned with
planning, organizing, directing, leading, motivating and controlling. Managers can be rated on
the above parameters or characteristics.

CRITERIA FOR MEASURING PERFORMANCE AT

DIFFERENT LEVELS:
The criteria for measuring performance changes as the levels of the employees and their roles
and responsibilities change.

A few examples for each level are described below:

For top-level management

• Degree of organizational growth and expansion

 • Extent of achievement of organizational goals

• Contribution towards the society

• Profitability and return on capital employed

For middle level managers

• Performance of the departments or teams

• Co-ordination with other departments

• Optimal use of resources

• Costs v/s revenues for a given period of time

• The communication with superiors and subordinates

For front line supervisors

• Quality of actual output against the targets

• Quality of output against the targets

• Number of accidents in a given period

• Rate of employee absenteeism

PERFORMANCE APPRAISAL FEEDBACK

Performance Appraisal process is incomplete without the feedback given to the employee
about his appraisal and his performance. But the way of giving as well as receiving the
feedback differs from person to person and they’re way of handling and their outlook towards
the issue. According to a popular saying:

“ A SUCCESSFUL MAN IS ONE WHO CAN LAY A FIRM FOUNDATION WITH THE
BRICKS OTHERS HAVE THROWN AT HIM.”

Therefore, on the part of the person receiving the feedback, the following points important to
be taken care of:

o The employee should have a positive attitude towards the feedback process.

o He should listen to the suggestions of the appraiser calmly and try to incorporate them
in his plans.

o He should not hesitate to ask for the help of his superior.

 o Should have a co-operative attitude during the feedback meeting.

o Don’t judge the appraiser as a person.

o Should take the feedback objectively.

o Should not judge the appraiser as a person on the basis of the feedback.

On the part of the appraiser or the manager/person giving the feedback, the following points
are to be taken care of:

o The appraiser should make the receiver feel comfortable during the feedback meeting.

o The appraiser should make it a two – way conversation i.e. let the employee speak.

o Listen to the employee and note his points, suggestions, problems etc.

o The appraiser should not adopt a confrontational approach towards the meeting. The
goal is not to criticize the employee.

o Provide a constructive feedback to the employee i.e. in a way, which motivate him to
perform better.

o Have a positive attitude towards the process.

o Try to understand the reasons of his failure.

o Be fair and objective.

o Prepare yourself for what to say and how to say.

Make the appraisal feedback meeting useful and productive for the organization and the
employee.

SIGNIFICANCE OF THE STUDY:

• This study very helpful to know about how to appraise the employees.

• Helpful to learn what is the performance appraisal system of the company.

• This study also helping for knowing the methods of performance appraisal system.

• Performance appraisal system also motivate the employee for better performance.

• This study also helpful to know about how personal department work and how it
adjust with lower level and upper level ?
 COMPANY PROFILE

COMPANY PROFILE

Lumax Industries Ltd. was incorporated in 1945, promoted by S C Jain has grown from
success to success since its in Lumax in the year 1994 .

foundation. The company went public in the year 1984 , and thus in the same year embarked
on its highly successful technical collaboration with Stanley, Japan .Ten years of highly
rewarding partnership resulted in Stanley picking up financial stake Lumax signifies
‘LUMINOSITY MAXIMA’ for today’s demanding automobile users. It has taken automotive
lighting to an entirely new level. Today Lumax accounts for over 60% market share in the
Indian automobile lighting business, catalyzed by its over two decades strong technical and
financial collaboration with Stanley Electric Company Ltd, Japan, a world leader in vehicle
lighting and illumination products for automobiles.

As the most experienced automotive lighting solutions company in South Asia, Lumax ,
enjoys a history of more than half a century of innovation, technology, manufacturing and
market leadership. Today, Lumax Industries Limited is a full-capability provider of high
quality automotive lighting solutions for four wheelers and two wheeler applications, serving
automobile manufacturing in India as-well-as worldwide.

Lumax strives for continual improvement of manufacturing processes with emphasis on

consistent quality and cost effectiveness. Lumax has come a long way since its inception as a
trading company in the year 1945, under the aegis of its founder S.C. Jain .

Lumax became an ISO 9002 certified company in 1995 , attained its QS 9000 certification in
the year 1998 and achieved the ISO/TS 16949 : 2002 and ISO 14001 in 2003. In the same
year Lumax Industries Ltd de-merged from its Mirror and Filter Division , there-by focusing
on its core competency of producing stellar automotive lighting products.

Lumax has seven ultra modern manufacturing plants in India. Of these, two are located in
cities of Gurgaon , Dharuhera in the state of Haryana, near New Delhi and three plants in
Pune, near Mumbai in Maharashtra and one plant near Chennai . These facilities have been
laid out to match world's best plant engineering standards, their plants are busy producing
automotive lighting products in large quantities to customer's exacting standards.

Lumax has a futuristic vision with an experienced and customer focused management team.
This is clearly evident from their financial growth which has seen a steady upward trend right
since their inception. Lumax posted a growth of over 39% in 2004-05, despite a de-merger
from its mirror and filters businesses. automotive lighting now enjoys a singular focus at
Lumax Industries.

Lumax facilities are manned by over a 2000 highly skilled and specialized personnel
composed of associates, executives and managers. Lumax is listed on major stock exchanges
in India and depicts a shareholding holding of 26% by Indian promoters, and 46% by public
and corporate bodies .

Product range of the company includes:

Lumax Industries offers a wide array of complete automobile lighting systems and solutions,
which includes; stellar quality Head Lamps and Tail Lamps, Sundry and Auxiliary Lamps and
other related products and accessories for four wheeler, two wheeler, trucks, buses, earth-
movers, tractors and a variety of diverse applications.

Clients

The company is having a highly diversified customer base its clientele includes global as well
as domestic automotive majors like, John Deere, Nissan, TruckLite, Vignal, Maruti Suzuki,
Hero Honda, Tata, Bajaj, Ford, Volvo Fiat and many more.

Technical Alliance:

• Lumax, Japan
• Valeo lighting Systems, France
• Truck Lite, Europe

Milestones:

• 1945 S.C. Jain , Chairman, establishes a trading concern.

• 1956-66 Manufacturing units set up for automotive lighting equipment and other
components.
• 1975 Manufacturing unit set up for automotive filters .
• 1977-79 Manufacturing units became functional at Faridabad-Haryana and Pune-
Maharashtra.
• 1984 Private ltd. xompany to public limited company . Technical assistance agreement
with a Japan based company for lighting equipment.
• 1985-87 Dedicated manufacturing unit for Maruti-Suzuki at Gurgaon - Haryana.
• 1990 Manufacturing unit for auto bulbs with assistance a Japanese company.
• 1994 Financial participation of collaborator with a Japanese firm . Manufacturing unit
at Aurangabad-Maharashtra .
• 1995 ISO 9002 Certification to Gurgaon unit by TUV Germany .
• 1998 QS-9000 Certification to Gurgaon unit by DNV Netherlands . Production begins
at Lumax Dharuhera .
• 1999 QS-9000 Certification to Dharuhera unit by DNV Netherlands .
• 2003 ISO/TS 16949 : 2002 Certification for GURGAON and Dharuhera plants by
DNV, USA .
• 2004 ISO 14001 Certification for Gurgaon, Dharuhera and Chennai plants by DNV .
De-merger - Core Lighting Technology.
 CHAPTER-2
LITERATURE REVIEW

LITERATURE REVIEW
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
employee’s 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 organization’s 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.

II. 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 employee’s 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).
III. 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 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 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).

IV. 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.

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).

V. 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 employee’s 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.

VI. 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.
 CHAPTER-3
RESEARCH METHODOLOGY

RESEARCH METHODOLOGY

Research is an art of scientific investigation, the pursuit of truth with the help of study,
observation, comparison and experiment. The Advanced Learner’s dictionary of current
English, lays down the meaning of research as a careful investigation or inquiry especially
through search for new facts in any branch of knowledge. Some people consider research as a
movement, a movement from the known to the unknown. It is actually a voyage of discovery.
Research aims to analyze interrelationship between variables and to drive explanations and
thus enables us to have a better understanding of the world in which we live. It aims at
developing new tools, concepts and theories for a better study of unknown phenomena.

A significant part of research is the Research Methodology. In it, a researcher studies

the various steps that are adopted to the research problem. In research methodology we not
only consider the research method but also the logic behind the method chosen. Research
methodology helps to answer many questions concerning a research problem of study.

OBJECTIVE OF THE STUDY

• The main motto of the study is to learn about the performance appraisal system of the
company.

• To gain the practical knowledge about the personnel relations of employer and
employee.

• What are the various methods to appraise any employee so as to make him work for
the good sake of the company?

• How to train the employee so he could be able to catch the goals ineffective way.

• What are the rights enjoyed by the employee while working in the company?

• To gain the knowledge of the industry and to know the structure of the company.

• My area of interest was personnel department because I want to know about my ability
while being in the organization.
SAMPLE SIZE

The questionnaire in the company was circulated between the workers working in the
company at different posts. The questionnaire was conducted for 50 members. All these 50
members were the workers working within the company

DATA COLLECTION METHOD

For every research, related data can be collected in two ways:

• Primary data

I inquired the respondent through questionnaire. A structured questionnaire would be

presented to every respondent. The advantage is that the questionnaires are simple,
easy to understand and administer and can be easily tabulated and analyzed.

• Secondary data

The information and data relating to the project was taken form certain selected
magazines, relevant websites, reference book and other details provided by the
company.

Sources of primary data collection were:

• Observation

• Questionnaire

• Interview
Sources of secondary data collection were:

• Document sources of the organization

• Various publications

• Official research and process data collected by the organization.

In all two approaches were adopted to collect data and information regarding this study. The
strategy applied was to have a wide coverage of the organization, and at the same time, ensure
an in –depth perspective of the study.

The first step involved the administering of the various questionnaires to the relevant people
within the organization, of different department and designation.

The second step was the collection of data from documents and manuals, which provided the
details of HR matters, training and its programs, and requisite organizational information
pertinent to the study.

LIMITATION OF THE STUDY

 The sample size were limited due to some unavoidable reasons; namely, the number of
training programs and external to the regional office was dependent on the
participative level of the programs; the third phase sample was restricted to 50 on
suggestion of the training supervisor.

 Further some programs have been recently launched and therefore not many people
had attended it. This was also a serious limitation in expanding the sample size.

 There were constraints of time also.

 We also believe that another way to find out the effectiveness of the programs could
have been to analyze the performance records of the participants before and after
attending the training programs. However due to unavailability of this information I
had to study the effectiveness through the adopted procedure.

CHAPTER-4
DATA ANALYSIS AND INTERPRETATION
DATA ANALYSIS AND INTERPRETATION

1. Regular activities of the workers (Attendance).

Respondents Percentage

20-40 15%

40-60 25%

60-80 40%

80-100 20%

Total 100%

TABLE:-1

40%
35%
30%
20-40
25%
40-60
20%
60-80
15%
80-100
10%
5%
0%

20-40 40-60 60-80

80-100

Chart-1

INTERPRETATION
15% respondents are under 20-40 respondents.25% respondents are under 40-60
respondents.40% respondents are under 60-80 respondents

2. Do workers work with their full response towards the work?

Respondents Percentage

Excellent 44%

Good 44%

Average 12%

Total 100%

TABLE:-2

Chart-2

INTERPRETATION

44%respondents work excellent towards their work,44%respondents work good

towards their workand 12%respondents work average towards their work
 3. Do the workers give the fruitful performance?

Respondents Percentage

Yes 55%

No 35%

Can’t say 10%

Total 100%

TABLE:-3

Can’t say
Can’t
No
say Yes

No

Yes
0% 20% 40% 60%

Chart-3

INTERPRETATION

55%person give their fruitful work,35% person don t give their fruitful work and can
not be told about 10%person
 4. Do workers help in maintaining the cleanliness of the company?

Respondents Percentage

Yes 45%

No 55%

Can’t say 05%

Total 100%

TABLE:-4

60%

50%

40%
Yes
30% No
Can’t say
20%

10%

0%

Yes No
Can’t say

Chart-4

INTERPRETATION
 45% person help in maintaing cleanness in the company 55%person don t help in
maintaing cleanness and 5%preson can not say

5. Do the workers work according to rules and regulations of the company?

Respondents Percentage

Yes 50%

No 50%

Can’t say 00%

Total 100%

TABLE:-5

50%

40%

30% Yes
No
20% Can’t say

10%

0%

Yes No Can’t
say

Chart-5

INTERPRETATION

50%person work according their rules and 50%person don t work according their rules
and 0% can not say
 6. Do the workers complete the work in given time period?

Respondents Percentage

Yes 45%

No 35%

Can’t say 20%

Total 100%

TABLE:-6

45%
40%
35%
30%
Yes
25%
No
20%
Can’t say
15%
10%
5%
0%

Yes No
Can’t say

Chart-6

INTERPRETATION
45% person complete the work in given time period.35% person don tcomplete their
work in given time period and can not be said about the 20% person

7. Do the workers give the excellent quality of work output?

Respondents Percentage

Excellent 75%

Good 25%

Average 00%

Total 100%

TABLE:-7

80%
Excellent
60%
Good
40% Average
Average
20% Good
Excellent
0%

Chart-7

INTERPRETATION

75% person give the excellent quality of work output,25%person give their good quality
of work output
 8. Can workers work or face the compliance and the buyers of the company?

Respondents Percentage

Yes 20%

No 75%

Can’t say 05%

Total 100%

TABLE:-8

80%
Yes
60% No
Can’t say Can’t say
40%
No
20%
Yes
0%

Chart-8

INTERPRETATION

20% worker face the compliance and and 75%worker don’t face the compliance and
can not be said about the 5% person
 9. Do the workers use the company’s resources effectively?

Respondents Percentage

Yes 80%

No 20%

Can’t say 00%

Total 100%

TABLE:-9

90%
80%
70%
60%
Yes
50%
No
40%
Can’t say
30%
20%
10%
0%

Chart-9

INTERPRETATION

80% worker uses the company resources effectively,20% worker don’t use the resources
effectively
 10. How do workers act to their fellow men and supervisors?

Respondents Percentage

Excellent 65%

Good 25%

Average 10%

Total 100%

TABLE:-10

80%
Excellent
60% Good
40% Average
Average
20% Good
Excellent
0%

Chart-10

INTERPRETATION

65%worker work excellent to their fellowman and supervisors and 25% worker act
good to their fellowman and supervisors and 10% person act average to their fellowman
and supervisors
 CHAPTER-5
FINDING,CONCLUSION &,SUGGESTION
 FINDING

• 15% respondents are under 20-40 respondents.25% respondents are under 40-60
respondents.40% respondents are under 60-80 respondents

• 55%person give their fruitful work,35% person don t give their fruitful work and can
not be told about 10%person

• 55%person give their fruitful work,35% person don t give their fruitful work and can
not be told about 10%person

• 80% worker uses the company resources effectively,20% worker don’t use the
resources effectively

• 65%worker work excellent to their fellowman and supervisors and 25% worker act
good to their fellowman and supervisors and 10% person act average to their
fellowman and supervisors
CONCLUSION

In Lumax there is very large number of the workers working for the company and a company
is an export house so it requires a large number of human resources to work over. The
company is earning good name and fame in the international market because of its ability of
completing the consignment given to them. This is all because of the effective Personal
Department, which is always there to help the environment of the company.

Secondly, it is the skilled labour that works very effectively to reach the desired goals. This
man power helps Lumax to achieve what it wants from the market so for keeping this power
in closed hands to utilized it well the company has the Human Resources Department which is
their to compromise the fight of the rights of the workers along with the profit of the
company.

So we can say that only the Human Resources Department has the ability to bridge the gap
between the top management sitting over to earn profit and the workers in the company
working to earn livelihood.

So it is quite clear that for smooth run of the company it is necessary to have a Personal
Department to cope up between the workers and the management.
SUGGESTION

1. Proper treatment should be given to the workers of the company by middle order
management.

2. Top level management should try to communicate the workers directly sometimes.

3. All the accessories required by the job must properly provided not only by the time
when compliance their on the field.

4. Workers should be given the good response to the quality of work they give to the
organization.

5. Though the cleanliness of the organization is good but as per my observation more
precautionary measures must be there to overcome the unsafe environment.

6. It was good t see the proper usage of the water, which the outcome of the water used
for the washing purpose.

7. The technique of using this Performance appraisal is good and some more techniques
must also be practiced as like Training programs and the teaching the workers how to
get control various disasters like fire fighting and so on.
 CHAPTER-VI
APPENDIX & BIBLIOGRAPHY
QUESTIONNAIRE

Name:-________________________________

Age:-__________________________________

Gender:-______________________________

Designation:-________________________

Department:-________________________

Date of joining:-____________________

Note: This questionnaire would be kept as confidential document as it’s for Survey
Purpose, and would not be revealed to Lumax Management.

QUESTIONS

1. Are the workers regular with their activities?

( ) Regular ( ) Irregular

2. How able are workers in completing their work?

( ) Fully ( ) Party

( ) Averaged

3. How effective the performance of worker is?

( ) Excellent ( ) Good

( ) Average

4. To what extent the workers maintain the cleanliness of the organization?

( ) Excellent ( ) Good
 ( ) Average

5. Up to which level do the workers follow the rules and regulations?

( ) Every time ( ) Some times

( ) Occasionally

6. Are the workers able to complete the task in given time period?

( ) Yes ( ) No

( ) Can’t say

7. Is the quality of output / result is good which workers give?

( ) Excellent ( ) Good

( ) Average

8. Are the workers capable of facing the compliance and buyers in effective way?

( ) Yes ( ) No

( ) Can’t say

9. Do the workers fully utilize the company’s resources?

( ) Yes ( ) No

( ) Can’t say

10. How does a worker act towards his fellow men and towards his superior?

( ) Pleasantly ( ) Impolitely
BIBLIOGRAPHY

P.C. Tripathi, Human Resource Development, Sultan Chand and Sons, 2001.

P.V. Rao, Readings in Human Resource Development, Oxford and I.B.M. Publishers

Dr. C.B.Mamorya, Dr. Satish Mamorya, Himalaya Publication House,revised Edition .

Net surfing.

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