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In the partial fulfillment of Master Degree in Business Administration (Session 2009-2012)

Guide: Mr. Sumit Mathur (H.R. Manager)

Researcher: Sonia Piplani (MBA VI Sem) Roll No. 0921001040

Institute of Management Technology

Centre for Distance Learning, Ghaziabad

This is to certify that this project report entitled Performance appraisal submitted as a major product in human resource is based upon personal experience, data collection and observations gained during the project report. This project report is submitted in fulfillment of the requirements for MASTERS OF BUSINESS ADMINISTRATION is an original research work carried out by me under the guidance and supervision of my mentor Mr. Sumit Mathur HR manager, PepsiCo India Holdings Pvt. Ltd. And this work and any part of this work have not been copied to any previously submitted project.

Sonia Piplani

A Project involves a series of activities and it becomes really difficult for the researcher to finish the task all alone without any assistance. My project is not any exception, so it becomes my moral obligation to acknowledge all those people who lend me their support in the completion of this report. I owe special thanks to Mr. Sumit Mathur (HR Manager), for her proper guidance throughout the period which helped me in understanding the topic well. Lastly, I am really grateful to my parents and my friends for their valuable assistance and support which helped me in preparation of this summer training report.

In every organization management is the part of the organization , which concerns with planning, organizing , staffing , directing & controlling of various marketing activities plans and organize, then as well as direct the human efforts to control the force and utilize the material for the benefit of human being. During the process of economic liberalization, the same pattern emerged in Indian companies.

As an integral part of the curriculum, all MBA students are required to undergo a practical training in some industry. The main objective of this training to supplement students theoretical knowledge with exposure to practical operation of an organization. This provides the student with better understanding of all functional areas of management and management skill applied in those functional areas.

Performance appraisal, also known as employee appraisal, is a method by which the performance of an employee is evaluated (generally in terms of quality, cost and time). The roots of performance appraisal can be found in Fredrick Winslow Taylors time and motion study. Performance appraisal is a part of career development. Performance appraisal is a regular review of employee within the organization. Generally, the aim of scheme is: Give feedback on performance to employees. Identify employee training needs. Document criteria used to allocate organizational rewards. Form a basis for personnel decisions- salary increment, promotions, disciplinary actions, etc. Provide opportunity for organizational diagnosis and development. Facilitate communication between employee and administrator. Validate selection techniques and human resource policies to meet Federal Equal Employment Opportunity requirements. The report starts with the introduction. Wherein the objective of the study, its scope, methodology, sample selection, analysis technique etc is explained in details. It gives an insight to the basic building blocks of the report, with the help of which the report progresses.

Declaration Acknowledgement Preface Executive Summary Company Profile Product Profile Objective of the Study Scope of the Study Limitation of the Study An Overview Research Methodology Data Analysis Recommendations Conclusions References Appendix 7 31 42 43 44 45 102 107 108 109 110 112

History of the Organization

To be best consumers Products Company in the eyes of suppliers, customers, consumers, employees and shareholders.

Sales vision-

To build exceptional customers focused sales team which will consistently

exceed customers exception by delivering executional excellence in the marketplace through selling systems and process.

To be worlds premier consumer products company focused on convenient foods and beverages. We seek to provide healthy financial rewards to our investors as we provide opportunities for growth and enrichment to our employees, our business partners, and the communities in which we operate. And in everything we do, we strive for honesty, fairness and integrity.


Present the opportunity Explain the solutions and benefits Provide the details Secure the sales Implement the next steps

Jainpur plant of PepsiCo Foods Ltd., is an important unit in Jainpur Industrial Area, which comes under Kanpur Dehat engaged in bottling of Pepsi and other brands of cold drinks. Its capacity is 2000 Bottles per minute and has approximately 450 distributors. Plants maximum distribution capacity is 1 lakh cases per day and average distribution is 60 thousand cases per day. Plant location & layouts have a greater impact on the business hence special considerations have been given in selecting these by management.


Location : Established: 45kms from Kanpur city 1996 Mother feed plant for U.P. Largest in terms of installed GRB Capacity Area: Capacity : Five Lines: SASIB Line 12.7 Acres 2000 BPM which comes to around 1 lac cases per day

Commissioned in 1996 Capacity 400 BPM i.e. 1000 cases/Hour

Ketnner Line
Commissioned in 1997 Capacity 600 BPM i.e. 1500 cases/hour

Slice Line
Commissioned in 1997 Capacity 600 BPM i.e. 500 cases/hour

KHS Line
Commissioned in 1999 Capacity 600 BPM i.e.1500 cases/hour

PET Line
Commissioned in 2001 Capacity: 600 ml : 2.00ml - 300 BPM i.e.750 cases/hour - 140 BPM i.e1400 cases/hour

2000 BPM i.e. around 1 lakh cases/day


Market area of Jainpur plant is divided in to two zones:-

1) Kanpur city and Kanpur : -It includes whole areas of Kanpur city and Kanpur Dehat.
Main areas are: - Whole city, Akbarpur, Urrai, Unnao, Ghatampur, Hamirpur, Fatehpur, Farrukhabad, Billahore, Rasulabad, Bithoor, etc.

2) Lucknow: - It includes whole areas of Lucknow city and Lucknow UP country. Main
areas are: - Lucknow city, Sitapur, Hardoi, Gursaigunj, etc

MAIN AREAS Akbarpur Urrai Unnao Ghatampur Hamirpur 6) Fatehpur 7) Farrukhabad 8) Billahore 9) Rasulabad 10) Bithoor

MAIN AREAS 1) Lucknow city 2) Sitapur 3) Hardoi 4) Gursaigunj

Jainpur plant with maximum supply capacity of 1 lakh cases per day supplies 60 thousand cases per day on an average. There is a well set supply channel of various products which includes direct supply to the distributors as well as supply from the warehouse. There are two warehouse one at Kanpur and other at Lucknow wiyt a head office at Lucknow. Supply is done on demand or orders from warehouse and distributors. For getting and placing the orders there is a well set communication channel between Head Office and the plant which is linked by V-Sat. Computer network and all the linkage is through SAP-ERP software.


In order to operate successfully Pepsi operates through:

Company owned bottling operations (COBO):-Pepsi makes, sells and supplies

the product.

Franchise owned bottling operations (FOBO):- local bottler makes, sells and
supplies the product

Joint Venture (JV):- Pepsi and partner make sells and supplies the products. FRONT LINE:- Serve the customers Market Unit:-Executive flawlessly Business Unit:-implement resources and support

Support Center:-Create tools and process

Every other employees support the front line.

Right Products, Right Place, Right Time, Everyday is the companys key

Marketing Unit Concept

The company is divided into Business units (BU), with head quarter in NEW YORK there are nine Business Units all over the world. India comes under the south east business unit which also cover Nepal, Bangladesh and Srilanka. The Indian head quarters are located at gurgaon. Each business unit has some market units (MU) under it. In India, there are five market units:-

South Market Units (SOMU): whole of south with HQ at Chennai.

West Market Units (WEMU): HQ at Mumbai, rest of Maharashtra and Gujarat. North Market Units (NOMU):U.P., Punjab, Haryana, & Himachal Pradesh.

East Market Units (EAMU): Kolkata New Business Market Unit: Gurgaon




Pepsi-Cola contains basic ingredients found in the most other similar drinks including carbonated water, high fructose corn syrup, sugar, chlorine gas, phosphoric acid, caffeine, citric acid and natural flavors. The caffeine free Pepsi-Cola contains the same ingredients minus the caffeine. The original Pepsi-Cola Company went bankrupt in 1929. The original formula contained neither cola or nor caffeine. TYPE ENERGY FATE SODIUM CARBOHYDRATES SUGAR PROTEIN CAFFIENE AMOUNT PER 100 ML 196.5 kj 0g 0.98 mg 11.74 g 11.04 g 0g 10 mg

1990: Joe Montana returns in a commercial that challenges other celebrities to compare their pop to Pepsi. 1994: Adds expiration dates to all products. 1996: Lucas film and Pepsi shake hands on a long-term partnership for the Star Wars Trilogy films. 1998: Celebrates its centennial year with a birthday party attended by Ray Charles, Kool and the Gang, and the Rolling Stones. Also attending are President and Mrs. George Bush, Lady Thatcher and Walter Cronkite. Unveils its new look: a three-dimensional symbol for one Pepsi family. 1999: Introduces the animated character "Marfa lump," who is Star Wars' biggest fan. Mar. 31, 1999: Pepsi Bottling Group, Inc. (PBG) becomes a publicly traded company. 2001: Britney Spears joins the Pepsi family and sings her own version of "Joy of Pepsi." 2002: Becomes the National Football League's Official Soft Drink Sponsor. Mar., 2002: Cindy Crawford introduces the new look for Diet Pepsi. July 2002: Introduces the new brand Pepsi Blue with the tag line, "It's a Blue Thing." 2004: Introduces new brand Pepsi EDGE, with the same taste but half the sugar, crabs and calories of normal colas.

Company Profile
Type Founded Headquarters Key People Public (Nys E:PEP) New York City, U.S. 1965 Purchase, New York, U.S. Indra Nooyi- (Chair woman, President& CEO),John Compton-(CEO PepsiCo Americas), Michael White-(CEO PepsiCo International),Richard Goodman (PhD-CFO) Industry Products Food & Beverages Pepsi Diet Pepsi Mountain Dew Tropicana Products Fritos Aquafina Revenue Net Income $39.5 billion USD (2007) $5.6 billion USD (2007) 16.06% profit margin Employees Divisions 168,000 (2006) PepsiCo Americas (PepsiCo Americas Foods, PepsiCo Americas Beverages), PepsiCo International Websites

To be best consumers Products Company in the eyes of suppliers, customers, consumers, employees and shareholders.

Sales vision-

To build exceptional customers focused sales team which will consistently

exceed customers exception by delivering exceptional excellence in the marketplace through selling systems and process.

To be worlds premier consumer products company focused on convenient foods and beverages. We seek to provide healthy financial rewards to our investors as we provide opportunities for growth and enrichment to our employees, our business partners, and the communities in which we operate. And in everything we do, we strive for honesty, fairness and integrity.


Present the opportunity Explain the solutions and benefits Provide the details Secure the sales Implement the next steps

PepsiCo, Incorporated (NYSE: PEP) is a Fortune 500, American multinational corporation headquartered in Purchase, New York, with interests in manufacturing and marketing a wide variety of carbonated and non-carbonated beverages, as well as salty, sweet and cereal based snacks, and other foods. Besides the Pepsi brands, the company owns the brands Quaker Oats,

Gatorade, Frito-Lay, SoBe, Naked, Tropicana, Copella, Mountain Dew, Mirinda and 7 Up (outside the USA). Indra Krishnamurthy Nooyi has been the chief executive of PepsiCo since 2006. During her time, healthier snacks have been marketed and the company is striving for a net-zero impact on the environment. This focus on healthier foods and lifestyles is part of Nooyi's "Performance with Purpose" philosophy. Today, beverage distribution and bottling is undertaken primarily by associated companies such as The Pepsi Bottling Group (NYSE: PBG) and Pepsi Americas (NYSE: PAS). PepsiCo is a SIC 2080 (beverage) company. Headquartered in Purchase, New York, with Research and Development Headquarters in Valhalla, The Pepsi Cola Company began in 1898 by a NC Pharmacist and Industrialist Caleb Bradham, but it only became known as PepsiCo when it merged with Frito Lay in 1965. Until 1997, it also owned KFC, Pizza Hut, and Taco Bell, but these fast-food restaurants were spun off into Tricon Global Restaurants, now Yum! Brands, Inc. PepsiCo purchased Tropicana in 1998, and Quaker Oats in 2001. In December 2005, PepsiCo surpassed Coca-Cola Company in market value for the first time in 112 years since both companies began to compete. Current members of the board of directors of PepsiCo are Indra Nooyi C.E.O., Robert E. Allen, Dina Dublon, Victor Dzau, Ray Lee Hunt, Alberto Ibargen, Arthur Martinez, Steven Reinemund, Sharon Rockefeller, James Schiro, Franklin Thomas, Cynthia Trudell, and River King. On October 1, 2006, former Chief Financial Officer and President Indra Nooyi replaced Steve Reinemund as chief executive officer. Nooyi remains the corporation's president, and became Chairman of the Board in May 2007.

Mike White is the President of Pepsi-Co International Division.

Former top executives at PepsiCo

Steven Reinemund Roger Enrico D. Wayne Calloway John Sculley Michael H. Jordan Donald M. Kendall Christopher A. Sinclair Alfred Steele



In the US, working with its competitor Coca Cola Company, PepsiCo is a major lobbying force working to gain favorable legislation for the beverage industry. In 2005, PepsiCo spent $740,000 on lobbying, in 2006, $880,318, in 2007, $1 million, and in 2008, $1,176,000. In 2009, lobbying expenses rose to $4.2 million or nearly a 300 percent increase. Much of the increased lobbying expenses are due to the industrys fight against increased taxes on soft drinks. For 2009, PepsiCo has 31 lobbyists at 8 different firms lobbying on its behalf.

Pepsi Music
Pepsi Music is a promotional music label that is seen on Yahoo. It has many parts like the Pepsi Mic Pass, the most famous in Houston, Texas. It also contracts artists to advertise with Pepsi and other PepsiCo products.

PepsiCo brands
PepsiCo owns 5 different billion-dollar brands. These are Pepsi, Tropicana, Frito-Lay, Quaker, and Gatorade. The company owns many other brands as well. Pepsi, Caffeine-Free Pepsi, Diet Pepsi/Pepsi Light, Caffeine-Free Diet Pepsi, Caffeine-Free Pepsi Light, Wild Cherry Pepsi, Pepsi Lime, Pepsi Max, Pepsi Twist and Pepsi ONE.

Other U.S. carbonated soft drinks, including Mountain Dew, Crush, Mug Root Beer, Sierra Mist, Tropicana Twister Soda and Frawg 7 Up (Globally, outside the USA) Other U.S. beverages, including Aquafina (Flavor Splash, Alive, and Twist/Burst), Tava, Dole, Gatorade, Izze, AMP Energy, Propel Fitness Water, SoBe, Quaker Milk Chillers, and Tropicana Beverages marketed outside the U.S.: Alvalle, Concordia, Copella, Evervess, Fiesta, Frui'Vita, Fruko, H2OH!, Ivi, Junkanoo, Kas, Loza, Manzana Corona, Manzanita Sol, Mirinda, Paso de los Toros (drink). Frito-Lay brands: Baken-ets, Barcel, Bocabits, Cheese Tris, Cheetos, Chester's, Chizitos, Churrumais, Cracker Jack, Crujitos, Doritos, Fandangos, Fritos, Funyuns, Gamesa, Go Snacks, James' Grandma's Cookies, Hamka's, Lay's, Miss Vickie's, Munchies, Munchos, Nik Naks, Ollie's Meat Snacks, Quavers, Rold Gold, Ruffles, Rustler's Meat Sticks, Sabritas, Sabritones, Sandora, Santitas, Smartfood, The Smith's Snackfood Company, Sonric's, Stacy's Pita Chips, Sun Chips, Tor-tees, Kurkure, Tostitos, Walkers, and Wotsits Quaker Oats brands: Aunt Jemima, Cap'n Crunch, Chewy Granola bars, Coqueiro, Crisp'ums, Cruesli, FrescAvena, King Vitaman, Life, Oatso Simple, Quake, Quisp, RiceA-Roni, and Spudz In 2005 PepsiCo launched Sting Energy Drink (carbonated) in Vietnam, and in some Asian countries in 2011 including Pakistan, Philippines & Malaysia.

In 2007, Nooyi spent $1.3 billion on healthier-alternative brands like Naked Juice, a California maker of soy drinks and organic juice.

Pepsico has also recently acquired a 50% stake in U.S.-based Sabra Dipping Company.

Soft drinks market in India

India is one of the top five markets in terms of growth of the soft drinks market. The per capita consumption of soft drinks in the country is estimated to be around 6 bottles per annum in the year 2003. It is very low compared to the corresponding figures in US (600+ bottles per annum). But being one of the fastest growing markets and by the sheer volumes, India is a promising market for soft drinks. The major players in the soft drinks market in India are PepsiCo and Coca-Cola Co, like elsewhere in the world. Coca-Cola acquired a number of local brands like Limca, Gold Spot and Thums Up when it entered Indian market for the second time. Pepsi Cos soft drink portfolio also consists of Miranda and 7Up along with Pepsi. The market share of each of the company is more or less the same, though there is a conflict in the estimates quoted by different sources The major ingredient in a soft drink is water. It constitutes close to 90% of the soft drink content. Added to this, the drink also contains sweeteners, Carbon dioxide, Citric Acid/Malic acid, Colors, Preservatives, Anti Oxidants and other emulsifying agents, etc.

Consumption patterns in India

In Tier 1, 2 and 3 cities in India, 29% of Indian consumers report consuming carbonated beverages/soft drinks during a fixed time of the day suggesting consumption has become a routine part of their day, with most consumption taking place during the 'afternoon to evening' time period. Not surprisingly, consumption is highest in Tier I cities such as Mumbai, Delhi,

Kolkata, Chennai, Hyderabad and Bangalore. The level of consumption is seen to increase with rising household incomes (with the exception of the highest income level) while decreasing with age. The Indian soft drinks market is not under any regulation. Prevention of Food adulteration act 1954 does not include soft drinks. None of the BIS standards that existed before August 2003 had any guidelines or set criteria for the residue levels of pesticides in the soft drinks. But different lie agencies have set standards for the residue levels of pesticides. The European Economic Community (EEC) sets the maximum admissible concentration of individual pesticides and related products in drinking water at 0.1 parts per billion to ensure that the toxicity is not dangerous to human beings. For a few pesticides like aldrin, dieldin and heptachlor epoxies the admissible limit is even more stringent, i.e., 0.03 parts per billion.

PepsiCo in Burma
From 1991 until 1997, PepsiCo is one of the most notable companies to do business in Burma. PepsiCo's business partner, Thein Tun, was a noted business partner of the ruling Burmese military junta, which has been alleged to be responsible for some of the worst human rights violations in the world. PepsiCo's involvement prompted one of the biggest Burma-related boycotts in history. The campaign was on a par with those against Texaco and Unocal, running around the same time, and currently against Total Oil. PepsiCo formally began their investment in Burma in November 1991 when they opened a bottling plant in the then-capital Rangoon, despite the call by Aung San Suu Kyi and the National League for Democracy for companies to avoid doing business in Burma until it returned

to democracy. The campaign against Pepsi was initiated by the Asian-based Burma Rights Movement for Action. The campaign later gained growing strength in the West as Burmese human rights groups focused on campaigns against companies in Burma, including the oil giants Texaco, Unocal, Amoco, and Petro-Canada. When Petro-Canada left Burma, Canadian and U.S. based Burmese democracy groups sharpened their focus on PepsiCo. The campaign received a massive boost when, in 1996, the Free Burma Coalition took the lead in forcing Pepsi out of American universities. This included the scrapping of a multi-million dollar deal at Harvard. The campaign also spread to Europe, where the UK-based organization, Third World First, adopted the boycott. In response, in 1996, PepsiCo attempted to step out of the spotlight by selling its share of its Burmese joint venture to its partner but retaining its Burmese franchise agreement. Aung San Suu Kyi responded, "As far as we are concerned, Pepsi[Co] has not divested from Burma" and both human rights and environmental groups continued the pressure on Pepsi. Eventually, with the Burmese regime holding violent anti-democracy rallies and pressure from around the world mounting, PepsiCo announced in January 1997 that it would cut all ties with Burma. However, to this day, PepsiCo has not admitted that it was morally wrong to invest in Burma as some other companies have upon leaving the country.

PepsiCo in Israel
Until 1991 PepsiCo was not sold in Israel, for which it was criticized by many in the United States who believed it was supporting the Arab boycott of Israel. PepsiCo always denied this allegation, saying Israel was simply too small to support a franchise. As a result, the Israeli

market was taken over by Pepsi's rival Coca Cola, and to this day Pepsi has a very small market share in Israel.

Pepsi Bottlers
The Pepsi Beverages Company logo.

On August 4, 2009 PepsiCo announced that it had reached a final merging agreement with its two largest bottlers The Pepsi Bottling Group, Inc and PepsiAmericas, Inc both of which it had previously spun off in the 1990s. The total cost of the transaction is estimated at $7.8 billion. The merger was approved by shareholders of both bottling companies on February 17, 2011 and was completed on February 26, forming a new wholly-owned division of the PepsiCo North American Beverages unit, Pepsi Beverages Company (PBC). Also included in the merger was a new agreement with the Dr Pepper Snapple Group in which PBC would soon be taking over the bottling and distribution of the Dr Pepper, Schweppes and Crush brands in those markets where they were formerly distributed by PBG and PAS through a 20-year licensing deal (PBC's predecessors have been bottling and distributing Crush in most of their markets since February 2009). It is currently unknown if and when PBC will also distribute Dr Pepper and Schweppes in the rest of its territory (as those markets, such as the Chicago market, also have DPS-owned bottlers serving those areas).

Additionally, in those areas of the US that are served by PBC- and DPS-owned bottlers, the bottling rights to certain other DPS-owned brands such as Vernors and Hawaiian Punch would be transferred to the DPS bottlers. The international operations of both former bottlers were transferred directly to the wholly separate PepsiCo International unit.

PepsiCo Americas Beverages

Pepsi was founded in 1898 by Caleb Bradham, a New Bern, North Carolina, druggist, who first formulated Pepsi-Cola. Today, Brand Pepsi is part of a portfolio of beverage brands that includes carbonated soft drinks, juices and juice drinks, ready-to-drink teas and coffee drinks, isotonic sports drinks, bottled water and enhanced waters. PepsiCo Americas Beverages (PAB) has well known brands such as Mountain Dew, Diet Pepsi, Gatorade, Tropicana Pure Premium, Aquafina water, Sierra Mist, Mug, Tropicana juice drinks, Propel, SoBe, Slice, Dole, Tropicana Twister and Tropicana Season's Best.

In 1992 PAB formed a partnership with Thomas J. Lipton Co. to sell ready-to-drink tea brands in the United States. Pepsi-Cola also markets Frappuccino ready-to-drink coffee through a partnership with Starbucks. Tropicana was founded in 1947 by Anthony Rossi as a Florida fruit packaging business. In 1954 Rossi pioneered a pasteurization process for orange juice. For the first time, consumers could enjoy the fresh taste of pure not-from-concentrate 100% Florida orange juice in a ready-to-serve package. The juice, Tropicana Pure Premium, became the company's flagship product. PepsiCo acquired Tropicana, including the Dole juice business, in August 1998. So Be became a part of PAB in 2001. So Be manufactures and markets an innovative line of beverages including fruit blends, energy drinks, dairy-based drinks, exotic teas and other beverages with herbal ingredients. Gatorade thirst quencher sport drinks, was acquired by The Quaker Oats Company in 1983 and became a part of PepsiCo with the merger in 2001. Gatorade is the world's first isotonic sports drink as is backed by 40 years of science. Created in 1965 by researchers at the University of Florida for the school's football team, "The Gators," Gatorade is now the world's leading sports drink.

Pepsi Beverages Company

On February 26th, 2010, PepsiCo completed its mergers with PAS and PBG to strengthen its North American beverage business. The North American bottling operations of PAS and PBG are now an operating unit of PepsiCo known as Pepsi Beverages Company. PBC operates in the United States, Canada and Mexico and encompasses approximately 75 percent of PepsiCo's North American beverage volume. PBC's diverse portfolio includes some of the world's most

widely recognized beverage brands, including Pepsi, Mountain Dew, Sierra Mist, Aquafina, Gatorade, So Be, Lipton, and Amp Energy. PBC also manufactures and distributes third-party brands in key local markets such as Dr Pepper, Crush, Rock Star and Muscle Milk. The operating unit is headquartered in Westchester County, New York. PepsiCo Americas Foods (PAF) is PepsiCo's food and snack business in North and South America. Its portfolio of businesses includes Frito-Lay North America, Quaker Foods & Snacks, Sabritas, Gamesa and Latin America Foods.

Frito-Lay North America

In 1932, C.E. Doolin entered a small San Antonio cafe and purchased a bag of corn chips. Little did he dream this savory chip would become one of the nation's most popular snacks. Mr. Doolin learned that the manufacturer of the chips was eager to sell his small business, so he purchased the recipe, and began to sell FRITOS Corn Chips from his Model T Ford. Meanwhile, that same year, Herman W. Lay began his potato chip business in Nashville by delivering snack foods. Not long after, Mr. Lay purchased the manufacturer, and the H.W. Lay & Company was formed. H.W. Lay & Company became one of the largest snack food companies in the Southeast, and LAY'S brand Potato Chips is still America's favorite potato chip. Years later, in 1961, the Frito Company and the H.W. Lay company merged to become FritoLay, Inc. Today, Frito-Lay North America makes some of the most popular snacks in the US, including LAY'S and RUFFLES potato chips, DORITOS tortilla chips, TOSTITOS tortilla chips and dips, CHEETOS cheese flavored snacks, FRITOS corn chips, ROLD GOLD pretzels, SUNCHIPS multigrain snacks, CRACKER JACK candy coated popcorn.

Quaker Foods North America

The Quaker Oats Company was formed in 1901 when several American pioneers in oat milling came together to incorporate. In Ravenna, Ohio, Henry D. Seymour and William Heston had established the Quaker Mill Company. The figure of a man in Quaker clothes became the first registered trademark for breakfast cereal and remains the hallmark for Quaker Oats today. In Cedar Rapids, Iowa, John Stuart and his son, Robert, and their partner, George Douglas, operated the largest cereal mill of the time. Ferdinand Schumacher, known as "The Oatmeal King," had founded German Mills American Oatmeal Company in 1856. Combining The Quaker Mill Company with the Stuart and Schumacher businesses brought together the top oats milling expertise in the country as The Quaker Oats Company. The first major acquisition of the company was Aunt Jemima Mills Company in 1926, which is today the leading manufacturer of pancake mixes and syrup. Gatorade was acquired in 1983. In 1986, The Quaker Oats Company acquired the Golden Grain Company, producers of Rice-ARoni. Its brands today include Quaker oatmeal, Life and Cap'n Crunch ready-to-eat cereals, Aunt Jemima mixes and syrups, and Rice-A-Roni, Pasta Roni and Near East side dishes. PepsiCo merged with The Quaker Oats Company in 2001.

Headquartered in Mexico City, Sabritas is a leader in the Mexican snack and fun food market. Founded in 1943, Sabritas is renowned for the quality, variety and flavors of its products, and serves as the umbrella brand under which PepsiCo markets Frito-Lay products in Mexico, such as Cheetos, Fritos, Doritos and Ruffles. It is also the name brand for its own line of potato chips. Additionally, the business manufactures and markets several local brands such as Crujitos,

Poffets, Rancheritos and Sabritones. Sabritas controls around 80% of the Mexican snacks market. PepsiCo acquired Sabritas in 1966.

Headquartered in Monterrey, Mexico, Gamesa is a global leader in the cookies market, and Mexico's largest manufacturer of cookies. The company has offered its consumers a wide variety of high-quality products for every lifestyle, producing pastries, oats, cereals and other related products. It has production facilities in five states across Mexico. Among its most successful brands are Maras Gamesa, Emperador, Arcoiris, Mamut, Chokis, and Maizoro. In 1990, it was acquired by PepsiCo.

Latin Americas Foods

The Latin Americas Foods business includes operations in Brazil, Argentina, Colombia, Peru and Venezuela. Its portfolio of brands includes global snacks such as Lay's, Cheetos, Fritos and Doritos, as well as local brands like Lucky snacks in Brazil.

Product Profile
Our Brands
PepsiCo is home to hundreds of brands around the globe. Listed here are some of our most recognized. Pepsi-Cola Brands Frito-Lay Brands Gatorade Brands Tropicana Brands Quaker Brands


Pepsi Max


Pepsi Max Cease Fire Pepsi Natural Pepsi One Pepsi Throwback

Pepsi Wild Cherry Caffeine Free Pepsi Diet Pepsi Diet Pepsi Wild Cherry Caffeine Free Diet Pepsi

Sierra Mist
Sierra Mist Diet Sierra Mist Sierra Mist Cranberry Splash Diet Sierra Mist Cranberry Splash Diet Sierra Mist Ruby Splash


Slice - Grape

Slice - Diet Orange

Slice - Orange

Slice - Peach Slice - Strawberry


Tropicana Fruit Punch Tropicana Lemonade Tropicana Light - Lemonade Tropicana Light - Orangeade Tropicana Orangeade Tropicana Pink Lemonade Tropicana Strawberry Melon Tropicana Twister Soda - Diet Orange Tropicana Twister Soda - Grape Tropicana Twister Soda - Orange Tropicana Twister Soda - Strawberry

Ocean Spray (License)

Ocean Spray Apple Juice Ocean Spray Blueberry Juice Cocktail Ocean Spray Cranberry Juice Cocktail Ocean Spray Cran-Pomegranate Juice Drink Ocean Spray Orange Juice Ocean Spray Pineapple Peach Mango Juice Blend Ocean Spray Ruby Red Grapefrui Juice Drink Ocean Spray Strawberry Kiwi Juice Drink

Mountain Dew
Mountain Dew

Mountain Dew Code Red Mountain Dew Distortion Mountain Dew Live Wire Mountain Dew Throwback

Mountain Dew Typhoon Mountain Dew Voltage Mountain Dew White Out Caffeine Free Mountain Dew Caffeine Free Diet Mountain Dew Diet Mountain Dew Diet Mountain Dew Code Red

AMP Energy
AMP Energy AMP Energy - Elevate

AMP Energy - Lightning AMP Energy - Lightning Sugar Free AMP Energy - Overdrive AMP Energy - ReLaunch AMP Energy - Sugar Free AMP Energy - Traction AMP Energy Juice - Mixed Berry AMP Energy Juice - Orange

AMP Energy with Black Tea AMP Energy with Green Tea

Mug Root Beer

Mug Root Beer Diet Mug Root Beer Mug Cream Soda Diet Mug Cream Soda

Seattle's Best Coffee

Seattle's Best Coffee - Iced Latte Seattle's Best Coffee - Iced Mocha Seattle's Best Coffee - Iced Vanilla Latte

Tazo Brambleberry Tazo Giant Peach Tazo Organic Iced Black Tazo Organic Iced Green

SoBe Adrenaline Rush SoBe Sugar Free Adrenaline Rush SoBe Energize Citrus Energy SoBe Energize Green Tea SoBe Energize Mango Melon SoBe Energize Power Fruit Punch SoBe Lean Fuji Apple Cranberry SoBe Lean Honey Green Tea SoBe Lean Raspberry Lemonade SoBe Lifewater Acai Fruit Punch SoBe Lifewater Agave Lemonade

SoBe Lifewater B-Energy Black Cherry Dragonfruit SoBe Lifewater B-Energy Strawberry Apricot SoBe Lifewater Black and Blue Berry SoBe Lifewater Blackberry Grape SoBe Lifewater Cherimoya Punch SoBe Lifewater Fuji Apple Pear SoBe Lifewater Goji Melon SoBe Lifewater Mango Melon SoBe Lifewater Orange Tangerine SoBe Lifewater Pomegranate Cherry SoBe Lifewater Strawberry Dragonfruit SoBe Lifewater Strawberry Kiwi


Aquafina FlavorSplash - Grape

Aquafina FlavorSplash - Peach Mango Aquafina FlavorSplash - Raspberry Aquafina FlavorSplash - Strawberry Kiwi Aquafina FlavorSplash - Wild Berry Aquafina Sparkling - Berry Burst Aquafina Sparkling - Citrus Twist

Lipton (Partnership)

Lipton Brisk Lemon Iced Tea Lipton Brisk No Calorie Lemon Iced Tea Lipton Brisk Raspberry Iced Tea Lipton Brisk Sweet Iced Tea Lipton Diet Green Tea with Citrus Lipton Diet Green Tea with Mixed Berry Lipton Diet Iced Tea with Lemon Lipton Diet White Tea with Raspberry Lipton Green Tea with Citrus Lipton Iced Tea Lemonade

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PepsiCo Values & Philosophy:

Our Values & Philosophy are a reflection of the socially and environmentally responsible company we aspire to be. They are the foundation for every business decision we make.

The various underlying objectives of the study of performance appraisal system and its effectiveness are as follows: To have an adequate knowledge of employee performance in terms of study of performance appraisal system in PepsiCo. To study the perception of employees on the existing appraisal program and to find the drawbacks of the system. A comparative study between the two appraisal programs based on secondary data. To suggest measures for improving the current system to formulate suitable promotion, transfer, training and development policies and making employees aware of the upcoming system. To accomplish the overall organizational vision and mission by linking individual performance to company objective. To encourage two way communication between the executive and the reporting officers and bring about transparency in the performance assessment process. To translate future skill requirements of the organization into individual development plans.

Scope and Importance of the study SCOPE:

To structure the Performance appraisal of PepsiCo for different categories of employees. To analyze the performance appraisal of the organization. To compare the performance appraisal with general policy. To provide the systematic recruitment process. It extends to the whole Organization. It covers corporate office, sites and works appointments all over India. It covers workers, Clerical Staff, Officers, Jr.Management, Middle Management and Senior Management cadres.

Without focusing the pattern of management, organization philosophy highlights on achieving a surely where all citizens (employees) can lead a richer and fuller life. Every organization, therefore, strikes for greater productivity, elimination of wastes, lower costs and higher wages, so the industry needs a stable and energetic labors force that can boast of production by increased productivity. To achieve these objectives a good recruitment and selection process is essential. By which industry strikes right number of persons at the right time and at right places through and the planning period without hampering productivity.

Appraisal method is used by the top management of firms in order to evaluate the performance of employees in that particular organization. The performance appraisal method consists of management by objective (MBO), 360 degree appraisal, behavioral observation scale and behaviorally anchored rating scale. This method has several limitations in it. Firstly the performance appraisal method is only limited reliable and valid, then the information might be limited due to individual biases of those who are evaluating or conducting the qualitative data, the informal sampling procedures they use and the difficulty they go through while recording the information, coding it and finally analyzing it. This method also does not produce systematic and verifiable information and therefore has low credibility with the decision makers. It is difficult to observe behavior and interpret it in terms of its causes, effects and desirability. Rating behavior on an appraisal form is quite difficult. The human element plays a significant role in the appraisal process and introduces subjectivity and bias. This can be minimized by: documenting performance from time to time; basing criteria for evaluation on observable behavior; training the supervisors; and effectively communicating the expectations which management has of staff.

An Overview
Internship training is the mirror to the real corporate world. It is the best to compare our theoretical knowledge with the practical experience from the company. By this way one can get the opportunity to see that whether what we study in books is really prevailing in the companies or not and if prevailing then in what form. That is why I chose the topic Performance appraisal. As it covers many aspects of Human Resources available in the organization for the employees. Through the study of this topic I came to that there are several factors which affect the performance of the employees such as relationship between superiors and subordinates, working conditions, strengths and weaknesses of employees etc.

Our Commitment:
We are committed to delivering sustained growth through empowered people acting responsibly and building trust.

What It Means: Sustained Growth is fundamental to motivating and measuring our success. Our quest for
sustained growth stimulates innovation, places a value on results, and helps us understand whether today's actions will contribute to our future. It is about the growth of people and company performance. It prioritizes both making a difference and getting things done.

Empowered People means we have the freedom to act and think in ways that we feel will
get the job done, while adhering to processes that ensure proper governance and being mindful of company needs beyond our own.

Responsibility and Trust form the foundation for healthy growth. We hold ourselves both
personally and corporately accountable for everything we do. We must earn the confidence others place in us as individuals and as a company. By acting as good stewards of the resources entrusted to us, we strengthen that trust by walking the talk and following through on our commitment to succeeding together.

Guiding Principles:
We uphold our commitment with six guiding principles. We must always strive to:

Care for our customers, our consumers and the world we live in.
We are driven by the intense, competitive spirit of the marketplace, but we direct this spirit toward solutions that benefit both our company and our constituents. Our success depends on a thorough understanding of our customers, consumers and communities. To foster this spirit of generosity, we go the extra mile to show we care.

Sell only product we can proud of :

The true test of our standards is our own ability to consume and personally endorse the products we sell. Without reservation. Our confidence helps ensure the quality of our products, from the moment we purchase ingredients to the moment it reaches the consumer's hand.

Speak with truth and candor

We tell the whole story, not just what's convenient to our individual goals. In addition to

being clear, honest and accurate, we are responsible for ensuring our communications are understood.

Balance the long term and short term:

In every decision, we weigh both short-term and long-term risks and benefits. Maintaining this balance helps sustain our growth and ensures our ideas and solutions are relevant both now and in the future.

Win with diversity and inclusion:

We embrace people with diverse backgrounds, traits and ways of thinking. Our diversity brings new perspectives into the workplace and encourages innovation, as well as the ability to identify new market opportunities.

Respect others and succeed together:

Our mutual success depends on mutual respect, inside and outside the company. It requires people who are capable of working together as part of a team or informal collaboration. While our company is built on individual excellence, we also recognize the importance and value of teamwork in turning our goals into accomplishments.

Our Leadership
Senior Leadership Board of Directors Corporate Officers

Our Business
Meet the four major divisions of the PepsiCo family: PepsiCo Americas Beverages PepsiCo Americas Foods PepsiCo Europe PepsiCo Asia, Middle East & Africa

Policies Political Contributions PepsiCo's Political Contributions Policy

PepsiCo's Board of Directors has approved the following policy. Together with other policies and procedures, including our Code of Conduct, it guides our approach to political contributions. By following the policy and the accompanying procedures, by adhering to the letter and the spirit of all applicable laws and regulations, and by exercising sound judgment regarding our involvement in the political process, we affirm and strengthen our commitment to PepsiCo's values. It is essential in a democratic society that citizens participate in their government. The health of our society depends on all of us being well informed and responsibly engaged in the political process. The PepsiCo Concerned Citizens Fund (CCF) receives voluntary employee contributions to make political campaign contributions to U.S. federal and state political parties, committees and

candidates. The CCF and the company's corporate contributions provide an important opportunity for PepsiCo, and its employees, to participate in the democratic process. We believe that providing financial support to responsible pro-business candidates is an important means by which we help improve the business climate, our quality of life and the society in which we live, enabling us to succeed as a company committed to integrity, innovation and value. The following criteria will be used in connection with all contributions: The candidate's or entity's commitment to improving the business climate; The candidate's or entity's position or voting record on issues of direct concern to PepsiCo; The location of PepsiCo facilities or employees within the candidate's district or state; The candidate's position on key committees where legislation of importance to PepsiCo is considered or the candidate's demonstrated leadership - or potential for leadership within the U.S. Congress or a State Legislature; The candidate's need for campaign financial assistance.

The public policy issues we face as a company and our engagement in the public policy process, including contributions as part of the political process, are discussed with and reviewed by the Nominating and Corporate Governance Committee of the company's Board of Directors. Details on PepsiCo's political contributions will be posted on its website on an annual basis. This will occur in conjunction with the release of PepsiCo's Corporate Citizenship Report each year.

All contributions and support of U.S. or state political parties, committees or candidates from the CCF or corporate funds must be made in accordance with applicable campaign finance and disclosure laws. Coercion of any employee to contribute to the CCF or to make any political contribution of any kind is unacceptable. Our employees have the right to be engaged in the political process in their individual capacity as they see fit, and make political contributions of their own time and money to the candidates or parties of their choice. Of course, those efforts must not in any way suggest PepsiCo's support. Management and supervisory employees who are citizens of the United States may voluntarily contribute to the CCF. PepsiCo employees must obtain approval of the Corporate Vice President Public Policy & Government Affairs before making political contributions of corporate funds. All contributions must be reviewed by the corporate law department to ensure legal compliance. All payments from the CCF to support U.S. or state political parties, committees or candidates must be approved by the CCF Executive Committee.

Human Rights PepsiCo's Human Rights Workplace Policy

PepsiCo respects the dignity of our workers in the workplace and we work to ensure our associates' rights to personal security, a safe, clean and healthful workplace, and freedom from harassment or abuse of any kind. We deal fairly and honestly with our associates regarding wages, benefits and other conditions of employment, and recognize our associates' right to freedom of association. We do not use compulsory or child labor. We do not tolerate discrimination and work to ensure equal opportunity for all associates. We comply with all applicable laws, regulations, and other employment standards, wherever we operate or work. We encourage our partners, suppliers, contractors and vendors to support these policies and we place substantial value on working with others who share our commitment to human right.

Animal Testing PepsiCo's Statement on Animal Testing

PepsiCo does not conduct any animal tests and does not directly fund any animal tests on its beverages and foods. Where governmental agencies require animal tests to demonstrate ingredient safety, companies using those ingredients rely on third party testing. PepsiCo has shared our concern regarding the ethical and humane treatment of animals with our suppliers and others in the industry. We encourage the use of alternative testing methods

whenever and wherever possible and have financially supported research to develop these alternative methods.

Genetically-Modified Food and Ingredient Policy Global Genetically-Modified Food And Ingredient Policy
PepsiCo is dedicated to producing the highest quality, greatest tasting food and beverage products in every part of the world. PepsiCo ensures all products meet or exceed stringent safety and quality standards and uses only ingredients that are safe and approved by applicable government and regulatory authorities. Approval of genetically-modified foods differs from country to country regarding both use and labeling. For this reason, PepsiCo adheres to all relevant regulatory requirements regarding the use of genetically-modified food crops and food ingredients within the countries it operates. Where legally approved, individual business units may choose to use or not use geneticallymodified ingredients based on regional preferences.

Global Sustainable Packaging Policy

PepsiCo's responsibility is to continually improve all aspects of the world in which we operate environment, social, economic - creating a better tomorrow than today. PepsiCo has a clear policy with regard to our understanding of the unique role packaging holds in shaping the way our products are presented to consumers, customers and communities. In addition to understanding its necessary role in protecting the quality and experience consumers have with our products, we respect our responsibility to contribute to the quality of life in our communities by optimizing the use of materials and continually improving our processes.

Our Global Packaging Policy expresses our Performance with Purpose vision and commitment to build shareholder value by making PepsiCo a truly sustainable company through programs that reflect our focus on economic growth, improving communities and environmental stewardship.

PepsiCo's Packaging Policy

PepsiCo is committed to develop packaging that: Supports continued shareholder growth Exemplifies Best-in-Class design and use of materials Maintains the highest quality and hygiene standards expected of our products by consumers Provides optimal protection for our products and trademarks Meets value, cost and performance criteria that satisfies consumer and customer desires Strives for the smallest possible environmental footprint

Our Aspirations regarding Sustainable Packaging As we strive for the smallest possible environmental footprint, PepsiCo has been inspired by many science-based sources, including the Sustainable Packaging Coalition (SPC) and the European Organization for Packaging and the Environment (EUROPEN). While some elements are quite straightforward to commercialize, others will require the continued work of our innovation and procurement teams, in conjunction with our suppliers. Our sustainable packaging aspirations aim to: Increase the use of recycled content or materials from renewable sources Optimize packaging design to use the fewest materials necessary

Promote the use of materials that can be recycled (beverage containers, cereal cartons, etc.)

Minimize post-industrial waste Avoid known negative impacts to the environment Achieve a lower carbon footprint by ensuring efficient energy usage across the product lifecycle

Principles PepsiCo regarding Sustainable Packaging

As we continue our journey to optimize materials, we have developed a set of principles to guide our decision making process. Decisions and actions will be based upon: The use of sound-science with reputable assumptions and benchmarks regarding the environmental impact of packaging Using common and understandable language, definitions and metrics Setting quantifiable, time-bound goals The responsible balancing of multiple considerations and variables when making packaging decisions Developing short-term and long-term continuous improvement packaging strategies

Setting and Achieving Goals

As part of this approach, we have established broad sustainable packaging objectives that are the basis for measurable goals that aim to turn these aspirations and principles into action across all functions within PepsiCo to focus our efforts and empower our employees.

The specific goals will be aligned with the line of business, such as Snacks and Beverages, and geographies, based on the opportunities that exist in those areas. As we continue to innovate and build upon our understanding of opportunities, PepsiCo may choose to add or update these goals to reflect the new technologies and materials that become commercially viable.

Earned 9 percent less in 2008, announces layoffs, and makes Caldern happy. Pepsico had a net profit of 5.14 billion dollars in 2008, representing a 9.1 percent drop as compared to the previous year. Revenue reached a total of 43.25 billion dollars, up 9.5 percent, following a 10.8 percent increase in sales of the Pepsico American Food division, while Pepsico American Beverages brought in 1.4 percent less revenue, and Pepsico International saw a 19.3 percent rise in sales. In the last quarter of 2008, restructuring costs and asset write-downs brought the companys net profits down by 43 percent, to 719 million dollars, while sales grew by 3.1 percent, to 12.73 billion dollars.

These results prompted Pepsico to announce in late October 2008 that it would cut 3,300 jobs under a productivity improvement plan. Company sources say that with this plan it expects to save up to 1.2 billion over the next three years. Forty percent of the projected layoffs will result from the closure of six plants and other measures aimed at rationalizing production.

Pepsi announced last December that it was closing three plants and 30 distribution centers in Mexico, in addition to eliminating 700 routes in that country, all of which translates into 2,200 workers out of a job. In February, during the Davos meeting, PepsiCo Executive Director Indra Nooyi met with Mexican President Felipe Caldern and informed him of plans to open a new plant in Celaya (Guanajuato), with an initial investment of 100 million dollars. According to official sources, Caldern celebrated the undertaking and declared that it was further proof that Mexico was on the right track as a destination for investments. Of the 2,200 laid off workers, not a word. Apparently thats only a minor detail.

Financial News
PepsiCo has enjoyed a long history of delivering strong financial growth for shareholders. With some of the world's most powerful brands, our commitment to sustainability and top global talent, PepsiCo is positioned to win in the long term. Get the latest presentations, reports and communications from the company here.

PepsiCo Declares Dividend

PURCHASE, N.Y., July 16 /PRNewswire-FirstCall/ -- The Board of Directors of PepsiCo, Inc. (NYSE: PEP) today declared a quarterly dividend of $0.48 per share on PepsiCo common stock.

The dividend is payable September 30, 2010, to shareholders of record on September 3, 2010. This quarterly dividend is a 7 percent increase versus the comparable...

PepsiCo Announces Webcast of Conference Call on Second-Quarter 2010 Earnings

PURCHASE, N.Y., June 3 /PRNewswire-FirstCall/ -- PepsiCo, Inc. (NYSE: PEP) today announced that its second-quarter 2010 earnings conference call and slide presentation for financial analysts and investors will be webcast live over the internet on Tuesday, July 20 at 8 a.m. eastern daylight time (EDT). The company will issue its financial results... Sabra Dipping Company Opens the Doors to New Manufacturing Plant and New Opportunities in Virginia. COLONIAL HEIGHTS, Va., May 26 /PRNewswire/ -- In a celebratory ceremony attended by the Governor of Virginia, the Honorable Bob McDonnell, Indra Nooyi, chairman and chief executive officer of PepsiCo and Ofra Strauss, chairperson of Strauss Group, Sabra Dipping Company ( officially opened its new manufacturing plant in Colonial... PepsiCo to Invest $2.5 Billion in China Over Next Three Years SHANGHAI, May 21 /PRNewswire-FirstCall/ -- PepsiCo, one of the world's largest food and beverage companies, today announced that it plans to invest an additional US$2.5 billion in China over the next three years. The newly announced investment is in addition to the US$1 billion investment the company announced in 2008, which will be completed...

PepsiCo Declares Dividend

PLANO, Texas, May 4 /PRNewswire-FirstCall/ -- The Board of Directors of PepsiCo, Inc. (NYSE: PEP) today declared a quarterly dividend of $0.48 per share on PepsiCo common stock.

The dividend is payable June 30, 2010, to shareholders of record on June 4, 2010. This quarterly dividend is a 7 percent increase versus the comparable year-earlier...


Earnings down by 3 percent in 2008 Last year, The Coca-Cola Company had a net profit of 5.81 billion dollars, representing a 3 percent drop with respect to 2007. The company says its results were hurt by restructuring costs and asset write-downs. Sales figures reached 31.94 billion dollars, up 11 percent from last year. The increase in sales was registered across all the regions the company operates in, with growth ranging from 6 percent, in North America, to 18 percent in Latin America. In the fourth quarter of 2008, Coca-Cola suffered an 18 percent decline in profit, earning a total of 995 million dollars, while revenue fell 3 percent to 7.13 billion dollars, dragged down by the 12 percent drop in Eurasia and Africa, and the 3 percent drop in Europe. Coca-Cola says it has implemented a number of measures that will run to 2011 and will result in annualized savings of 500 million dollars. No more details were provided by the companys spokespersons, but in view of current corporate trends it wouldnt be surprising if such measures include job cuts.

Another interesting fact is that the consultancy firm Interbrand placed the Coca-Cola brand first in its Best Global Brand ranking, valuing it at 66.67 billion dollars. Coca-Cola products are consumed in more than 200 countries around the world, with over 1.5 billion units sold daily.


Human resource management is a process of bringing people and organizations together so that the goals of each are met. It is the part of management process which is concerned with the management of human resources is an organization. Personnel Management involves the task of handling the human problems of an organization and is devoted to acquiring, developing, utilizing and maintaining an efficient work force.


Human resource Management may define as the art of procuring, developing, and maintaining competent workforce to achieve organizational goals efficiently. Personnel Management is the specialized intelligent handling of the human factor by a separate department which could devote its full time for research along the line of improvement is industrial relations


To help the Organization Reach its goal. To employ the skills and abilities of the workforce efficiently. To provide the Organization with well-trained and well-motivated employee. To Increase the fullest the employee jobs satisfaction and self actualization To develop and maintain a quality of work life. To communicate HR policies to all Employees. To be ethically and socially responsive to Needs of the society.


Providing suitable and most productive employment, which might bring them psychological satisfactions. By helping people make their own decisions, that are in their interest. Improving the employees working still and capacity. Correcting the errors of wrong postings and proper reallocations work. Creating a right attitude among the employees through the motivation. Utilizing effectively the available human resources.


Performance Appraisal is the process of assessing the performance and progress of an employee on a given job.
It is the systematic, periodic and impartial rating of an employees excellence of work. It is the method of evaluating the behaviour of employees in the workplace.

FEATURES OF PERFORMANCE APPRAISAL OBJECTIVES OF PERFORMANCE APPRAISAL Feedback: Performance appraisal serves as a feedback to the employees. It tells him what he
can do to improve his present performance and go up in organizational ladder.

Compensation decision: Performance appraisal provides input to system of rewards. The

approach to compensation is at the heart of the idea that raises should be given for merit rather than seniority.

Personal development: Performance appraisal can help reveal the causes of good and
poor employee performance. Through discussions with individual employees, a line manager can find out what initiatives can be taken to improve the performance.

Training and development: By identifying the strengths and weaknesses of an employee,

appraisal serves as a guide for formulating a suitable training and development programme to improve quality of performance in the present work.

Promotion decisions: It can serve as a useful basis for job change or promotion. By
establishing whether the worker can contribute still more in a different or a higher job. It helps in suitable promotion and placement.

Improves supervision: The existence of a regular appraisal system tends to make the
supervisors more observant of their subordinates because they know that they would be expected periodically to fill out rating forms and would be called upon to justify their estimates. This improves supervision.

Database: It provides a valid database for personal decisions concerning placements, pay,
promotion and transfer etc. Appraisal also makes the employee aware of his key performance areas.


Providing feedback: Providing feedback is the most common justification an

organization to have a performance appraisal system. Through this process the individual learns exactly how well he did from his previous performance and how can he improve his performance.

Facilitating promotion decisions: Performance appraisal makes it easier for the

organization to make good decisions about making sure that the most important positions are filled by the most capable individuals.

Layoff or downsizing decisions: When economic realities force an organization to

downsize, performance appraisal helps make sure that the most talented individuals are retained and only the organizations marginal performers are cut loose.

Encouraging performance improvement: A good performance appraisal helps

points out areas where individuals need to improve their performance.

Motivating superior performance: Performance appraisal helps motivate people

to deliver superior performance in several ways. Firstly, the appraisal process helps them learn what the organization considers being superior. Secondly, since most people want to be seen as superior performers, a performance appraisal process provides them with a means to demonstrate that they actually are.

Setting and measuring goals: The performance appraisal process is commonly

used to make sure that every member of the organization sets and achieve effective goals.

Counseling poor performers: Not everyone meets the organizations standards.

Performance appraisal forces managers to confront those whose performance is not meeting the companys expectations.

Encouraging coaching and mentoring: Managers are expected to be good

coaches to their team members and mentors to their portages. Performance appraisal identifies the areas where coaching is necessary and encourages managers.

Validating hiring decisions: Is the company hiring stars, or is it filling itself with

trolls? Only when the performance of newly hired individual is assessed can the company learn whether it is hiring the right people.

Improving overall organizational performance: A performance appraisal

system allows the organization to communicate performance expectations to every member and assess exactly how well each person is doing.

Need for Performance appraisal

Provide information about the performance ranks basing on which decision regarding salary

fixation, conformation, promotion, transfer and demotion are taken. To prevent grievances and in disciplinary activities. Provides information which helps to counsel the subordinates. Provides feedback information about the level of achievement and behaviour of


Importance of performance appraisal

The uses/importance of performance appraisal is shown in the following chart:

Performance improvement: Performance appraisal is use as a development tool by

the organizations. It helps in improving the performance of employees through work planning, skill identification and potential development. Employees are given reward for improved performance to reinforce improvement efforts in order to achieve the strategic goals effectively.

Compensation adjustment: Employees exhibiting super or performance are

rewarded through increase in their compensation to motivate them to further excel in their jobs. Employees showing weaker performance are given lesser compensation raises. Therefore, appraisal differentiates compensation of employees for performance reasons.

Placement decisions: Performance appraisal is used as a tool for making decision

on employee placement such as promotion, demotion, transfer, relocation, reassignment etc. performance papa- isle is considered to be most valid and reliable basis for placement decisions.

Career planning and development: Performance appraisal provides reliable data and
information on the current performance level, potentialities, and developmental needs of employees. Based on it career planning and developmental needs are identified.

Training and Development needs: Poor performance may indicate the need for
retraining. Likewise, good performance may indicate untapped potential that should be developed.

Job design errors: Poor performance may be a symptom of Ill-conceived job

designs. Appraisals help diagnose these errors.

Equal Employment Opportunities: Accurate performance appraisals that actually

measure job- related performance ensure that internal placement decisions are not discriminatory.

External challenges: Sometimes performance is influenced by factors outside the

work environment, such as family, financial health, or other personal matters. If uncovered through appraisals, the human resource department may be able to provide assistance.

Appraisal Procedure
The Appraisal system is planned, developed and implemented through the following steps:

1. Job Analysis, Job description and Job Specification:

Performance appraisal is a process not to be undertaken in isolation of various human resources functions. It begins with Job analysis, job description and job specification. These help in establishing the standard performance.

2. Establishing standards of performance: Appraisal systems require performance

standards, which serves as benchmarks against which performance is measured. The standards

set for performance must be clearly defined and unambiguous. They should be attainable by a normal employee. To be useful, standards should relate to the desired result of the each job.

3. Communicating performance standards to employees:

Performance appraisal involves at least two parties: the appraiser who does the appraisal and the appraise whose performance is being evaluated. The performance standards specified in the second step above are to be communicated and explained to the employees (both appraiser and appraise) so that they come to know what is expected of them. Feedback should also be taken to eliminate any confusion or misunderstanding. Feedback enables the manager to know that the information has reached the employees. If necessary the standards may be modified in the light of feedback obtained by the employees.

4. Measuring actual performance: After the performance standards are set and
accepted, the next step is to measure the actual performance. This requires choosing the right technique of measurement, identifying the internal and external factors influencing performance and collecting information on results achieved. It can be affected through personal observation, written and oral reports through supervisors. The performance of different employees should be so measured that it is comparable. Performance measures should be easy to use, be reliable and report on the critical behaviors that determine performance. Performance measures may be objective or subjective.

(a) Objective performance measures: Objective performance measures are indications

of job performance that can be verified by others and are usually quantitative. These include: Quality of production Degree of training needs Accidents in a given period

Absenteeism Length of service

(b) Subjective performance measures: Subjective performance measures are ratings

that are based on the personal standards or opinions of those doing the evaluation and are not verifiable by others. These include: Ratings by supervisors Knowledge about overall goals Contribution to socio-cultural values of the environment.

5. Comparing actual performance with standard: Actual Performance is compared

with the predetermined performance standards. Actual performance may be better than expected and sometimes it may go off track. Deviations if any from the set standards are noted. Along with the deviations, the reasons behind them are also analyzed and discussed. Such discussion will enable an employee to know his weaknesses and strength. Weaknesses are discussed so that employee takes interest n improving his performance. He will be motivated to improve himself.

6. Initiating corrective action, if any: The last step in the process is to initiate corrective
action essential to improve the performance of employees. Corrective actions are of two types:

The one, which puts out the fire immediately: Employee can be scolded or

warned so that he himself can make necessary attempt to improve his performance.

The other one which strikes at the root of the problem permanently:

Through mutual discussions with employees, the steps require to improve performance are identified and initiated. The reasons for low performance should be probed, take the employee

into confidence and motivate him for better performance. Training, coaching and counseling etc. are examples of corrective action that help to improve performance.

The other one which strikes at the root of the problem permanently:

Through mutual discussions with employees, the steps require to improve performance are identified and initiated. The reasons for low performance should be probed, take the employee into confidence and motivate him for better performance. Training, coaching and counseling etc. are examples of corrective action that help to improve performance.

PROBLEMS IN PERFORMANCE APPRAISAL Ineffective organizational policies and practices: If the sincere appraisal effort put
in by a rate is not suitably rewarded, the motivation to do a jab thoroughly finishes off. Sometimes, low ratings given by rater are viewed negatively by management as a sign of failure at the part of rater or as an indication of employee discontent. So, most employees receive satisfactory ratings, despite poor performance. Normally, the raters immediate supervisor must approve the ratings. However, in actual practice, this does not happen. As a result, the rater goes off the hook and causes considerable damage to the rating process.

Poor Appraisal forms: The appraisal process might also be influenced by the following
factors relating to the forms that are used by raters: The rating scale may be quite vague and unclear. The rating form may ignore important aspects of job. The rating form may contain additional, irrelevant performance dimensions. The forms may be too long and complex.

Judgment Errors: People commit mistakes while evaluating people and their performance.
Biases and judgment errors of various kinds may spoil the show. Bias here refers to distortion of a measurement. These are of various types:

First Impressions: The appraisers first impressions of a candidate may color his evaluation
of all subsequent behavior. In the case of negative privacy effect, the employee may seem to do nothing right; in the case of positive privacy effect, the employee can do nothing wrong.

Halo Effect: The Halo error occurs when one aspect of the subordinates performance

affects the raters evaluation of other performance dimensions. If a worker has few absences, his supervisor might give the worker a high rating in all other areas of work. Similarly, an employee might be rated high on performance simply because he has a good dress sense and comes to office punctually.

Horn Effect: The raters bias is in the other direction, where one negative quality of an

employee is being rated harshly. For example, the rate rarely smiles so he cannot get along with people.

Leniency: Depending on raters own mental make-up at the time of appraisal, raters

may be rated very strictly or very leniently. Appraisers generally find evaluating others difficult, especially where negative ratings have to be given. A professor might hesitate to fail a candidate when all other students have cleared the examination. The leniency error can render the appraisal system ineffective.

Central Tendency: An alternative to the leniency effect is the central tendency, which
occurs when appraisers rate all employee as average performers. For examples, a professor, with a view to play it safe might give a class grades nearly equal to B, regardless of the differences in individual performance.

Stereotyping: Stereotyping is a mental picture the an individual holds about a person

because of that persons sex, age, religion, caste, etc. By generalizing behavior on the basis of

such blurred images, the rarer grossly overestimates or underestimates a persons performance. For example, employees from rural areas might be acted poorly by raters having a sophisticated urban background, if the view rural background negatively.


A sound appraisal system should comply with the following:

Reliability and validity: The system should be both valid and reliable. The validity

of ratings is the degree to which they are truly indicative of the intrinsic merit of the employees. The reliability of the ratings is the consistency with which the ratings are made, either by different raters or by one rater at different times. Appraisal systems should provide consistent, reliable and valid information and data, which can be used to defend the organization- even in legal challenges.

Job Relatedness: The evaluators should focus attention on job related behavior and

performance of employees. In order to focus attention on behavior under the employees control, raters must become familiar with the observed behavior. It is also necessary to prepare a check-list so as to obtain and review job performance related information. The information generated through evaluations should be tailored to the needs of the organization, performance requirements and norms of behavior.

Standardization: Well- defined performance factors and criteria should be

developed. Appraisal forms procedures, administration of techniques, ratings etc., should be standardized as appraisal decision affect all employees of the group.

Practical Viability: The techniques should be practical viable to administer, possible to

implement and economical to undertake continuously. They must have the support of all line

people to administer them. If the line people think it is too theoretical, too ambitious, to unrealistic, or that ivory tower staff consultants who have no comprehension of the demands on time of the line operators have foisted on them, they will present them.

Training to Appraisers: The evaluators or adequate should be provided adequate

training in evaluating the performance of the employees without any bias. Evaluators should also be given training in philosophy and technique of appraisal. They should be provided with knowledge and skills in documenting appraisals conducting post appraisal interviews, rating errors etc. Familiarity with rating may improve raters performance and this may inject the needed confidence in appraisers to look into performance rating more objectively.

Open Communication: The system should be open and participative. Not only it

should provide feedback to the eon their performance, it should them in goal setting process. This helps in planning performance better. The employees the employees should actively participate in managing performance and in ongoing process of evaluation.

Employee Access to Result: Employees should receive adequate feedback on their

performance, then withholding appraisals results would not serve any purpose. If the result of appraisals is negative and goes against the employees, it should be immediately communicated to him so that he may improve his performance or he may go in appeal before the appropriate authority in case he is not satisfied. This will enable the management to gain the confidence of the employees.

Clear Objectives: The appraisal system should be object oriented. It should fulfill the

desired objectives like determining the potential for higher jobs or for sanction of annual increment in the salary or for granting promotion and transfer. The appraisal system should be fair so that it is beneficial both the employees and the organization. The system should be adequately and appropriately linked with other sub-systems of human resource management.

Post Appraisal Interview: After appraisal, an interview with the employee should

be arranged. It is necessary to apply feedback, to know the difficulties under which the employees work and identify their training needs. The appraiser adopts the problem solving approach in the interview and should provide counseling for improving performance.

Periodic review: The system should be periodically reviewed to be sure that it is

continuous to meet its goal. Not only there is the danger that subjective criteria may become more salient than the objective standards originally established, there is the further danger that the system may become rigid in a tangle of rules and procedure, many of which are no longer useful.

Factors affecting Performance appraisal Organizational Leadership

Environmental Constraints

Organizational Structure

Interdependence of Subsystems Organizational Leadership: The leadership at the top determines to a large extent the
loyalty and commitment of employees to the goals of the organization. Effective top leadership orients and motivates the entire organization for better performance.

Organizational Structure: There are two types of organization structuresorganist and mechanistic. Organist structures tend to be flexible. Such organizations change themselves very fast to cope up with the present changing environment. Mechanistic structures are very rigid and have clearly defined relationships and responsibility. These structures are static and are designed to carry out a nearly fixed strategy in a relative stable environment.

Environmental Constraints: Various environmental cons-taints affect the

performance of an employee. For example, the quality of new material may affect the productivity and performances of an employee. If the selection of materials and other things are done at the higher level in the organization, the performance appraisal of the worker wouldnt be affected.


It unifies the appraisal procedure so that all employees are rated in the same manner, utilizing the same approach so that the ratings obtained of separate personnel are comparable.

It provides information which is useful in making and enforcing important decisions selection, training, promotion, pay increases, transfers, lay-offs, discharges, salary adjustments, etc. The information supplied well in advance so that the spots judgments may be avoided.

It provides information in the form of records about ratings which may be produced as evidence when decisions on ratings are challenged in a court of law. Even arbitrators accept these in the course of grievance handling procedures as authentic records.

It serves to stimulate and guide employee development. Appraisal programme provides information on the weaknesses of employees and enable them to gauge their own value and accomplishments and to know what they are doing.

The weaknesses provide the basis for an individual development program. If used properly, such periodical appraisals will establish an atmosphere in which criticism can be taken without resentment and can be used constructively for self-improvement.

Employees can be weeded out to adjust themselves: by finding out an employees qualifications and his work and comparing it with job requirements, inefficient employees and those whose vies are not in harmony with the companys objectives, can be weeded out or persuaded to adjust themselves.

A periodic and accurate appraisal constraints a supervisor to be alert and competent in his work, i.e., it improves the quality of supervision by giving him incentives to do the things that should be normally be doing anyway.

It gives supervisors a more effective tool for rating their personnel, enables them to make a careful analysis of their men and gives them a better knowledge and understanding of them.

Broadly, all the approaches to appraisal are classified into: 1) Past-oriented techniques 2) Future-oriented techniques





Rating scales: This is the simplest and the most popular technique of appraising
employee performance. The typical rating-scales system consists of several numerical scales, each representing job-related performance criterion such as dependability, initiative output, attendance, attitude, and co-operation. Each scale ranges from excellent to poor. The rater checks the appropriate performance level on each criterion, and then computes the employees total score. The number of points scored may be linked with to salary increases whereby so many points equal a rise of some percentage.

Checklist: In this method, the rater doesnt evaluate employees performance; he

supplies reports about it and the final raring is done by the personnel department. A series of questions are presented concerning an employee to his behaviour. The rater, then, checks to indicate if the answer to question about an employee is positive or negative. To value of each question may be weighed equally or certain questions may be weighed more heavily than others. Generally, the questions are on yes/no pattern.

Forced Choice Method: In this the rate is given a series of statements about an
employee. These statements are arranged in block of two or more, and the rater indicates which statement is most or least descriptive of the employee. Typical statements are: a) Learns fast ------------------b) Work is reliable -------------works hard performance is a good

c) Absent often --------------- other usually tardy

Forced Distribution Method: One of the errors in rating is leniency- clustering a

large number of employees around a high point in the rating scale. The forced distribution method seeks to overcome the problems by compelling the rater to distribute the rate on all points on the rating scale. The method operates under an assumption that the employee performance level confirms to a normal statistical distribution. Generally, it is assumed that employee performance level conform a bell 20%, average 40%, below average 20%, and unsatisfactory10%..

Critical Incidents Method: The approach focuses on certain critical behaviors of an

employee that makes all difference between effective and non-effective performance of a job. Such incidents are recorded by the superiors as and when they occur.

Advantages of critical incidents method:

The evaluation is based on actual jab behavior The approach has description in support of particular rating of an employee. Giving job- related feedback rates is easy. It also reduces the regency bias, if raters record incidents throughout the rating period.

Limitations of critical incidents method:

Negative incidents are generally more noticeable than positive ones. The recording of incidents is chore to the supervisors and may be put off or easily forgotten. Overly close supervision may result.

Field Review Method: This is an appraisal by someone outside the assesses own
department usually someone from the corporate office or the HR department. The outsider reviews employee records and holds interviews with the rate and his or her superior. The method is primarily used for making promotional decisions at the managerial level. Field reviews are also useful when comparable information is needed from employees in different units and locations.

Confidential Report Method: In this method each worker is rated confidentially

by one or more senior officers for his performance. A confidential report by immediate supervisor is still a major determinant of the subordinates or transfer. The report deals with the years work and general opinion of the rater towards the employee. The main problem with this method is that it is not data based and the appraisal is done on the basis of impressions.

Essay Method: In the essay method, the rater must describe the employee within a
number of broad categories such as: The raters overall impression of the employees performance. The promo ability of the employee The jobs that the employee is now able or qualified to perform. The strength and weaknesses of the employee and the training and the development assistance required by the employees.

Cost Accounting Method: This method evaluates performance from the monetary
returns, employee yields to his or her organization. A relationship is established between the cost include in keeping the employee and benefit the organization derives from him or

her. Performance of the employee is then evaluated based on the established relationship between the cost and the benefit.

Comparative Evaluation Method: These are a collection of different methods

that compare one workers performance with that of his/ her co-workers. Comparative appraisals are conducted by supervisors. As these appraisals can result in a ranking from best to worst, they are useful in deciding merits-pay increases, promotions, and organizational rewards. The usual comparative forms used in this kind of evaluations are the ranking method and the paired comparison method.

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

Paired comparison method: Under this method, the appraiser compares each
employee, one at a time. For example, there are five employees name A, B, C, D and E. The performance of A is first compared with the performance of B and a decision is made about whose performance is better. Then A is compared with C, D and E in that order. The same procedure is repeated for other employees. The number of comparisons may be calculated with the help of the formula which reads thus:

n (n 1)/2 where n stands for the number of employees to be compared. If there are 10 employees then number of comparisons will be 10(10-1)/2 = 45. After the completion, the result can be tabulated and a rank is created from the number of times each person is considered to be superior.

Future-Oriented Appraisals
According to Prof. Reddin, MBO is the establishment of effectiveness areas and effectiveness standards for managerial positions and the periodic conversions of these into measurable time bound objectives linked vertically and horizontally and with future planning.

Management by Objectives: It was Peter F. Ducker who first gave the concept of MBO
to the world way back in 1954 when his The Practice of Management was first published. The MBO concept, as was conceived by Ducker, reflects a management philosophy which values and utilized employee contributions. Application of MBO in the field of performance appraisal is recent thinking. According to S.K. Chakarvarty, MBO may be defined as a result centered, non specialist operational managerial process for the effective utilization of material, physical and human resources of the organization with environment the organization, by integrating the individuals with the organization and organization with environment.

Disadvantages of Assessment Centers

Results only reflect employee performance on the day they were tested. They are expensive operations. It is imperative that all assessors are adequately trained. The process is not robust unless everyone involved is professionally prepared and a lot of good work can easily be undone by occasional lapses.

360 Degree Performance Appraisal: The appraiser may be any person who has thorough
knowledge about the job content, contents to be appraised, standards of contents, and who observes the employee while performing a job. The appraiser should be capable of determining what is more important and what is relatively less important. He should make reports and judgment without bias. Typical appraisers are: supervisor, peers, subordinates and employee themselves. Performance Appraisal by all these parties is called 360 degree Performance Appraisal.

Supervisors: Supervisors include superiors of the employee, other superiors having

knowledge about the work of the employee and department head or manager. General practice that immediate superiors appraise the performance, which in turn is reviewed by the departmental head or manager.

Peers: Peer appraisal may be reliable if the work group is stable over a long period of

time and performs task that require interaction.

c) Subordinates: The concept of having superiors rated by subordinates is being used in most
organizations today, especially in developed countries. Such a novel method can be useful in

other organizational settings too provided the relationships between superiors and subordinates are cordial.

d) Self-Appraisal: If individuals understand the objectives they are expected to achieve and
the standards by which they are to be evaluated, they are to a great extent in the best position to appraise their own performance.

e) Users of service customers: Employee performance in service organizations relating to

behaviors, promptness, speed in doing the job and accuracy, can be better judged by the customers or users of services.

f) Consultants: Sometimes consultants may be engaged for appraisal when employees or

employers do not trust supervisor appraisal and management does not trust the self-appraisal or peer appraisal or subordinate appraisal.

Factors Impacting 360 Degree Performance Appraisal Organizational Cynicism: When employees in an organization hold the common belief
that potentially fixable problems cannot be resolved due to factors beyond the control of the employees, it results in organizational cynicism. Cynicism with regards new initiatives results from past implementation failures or incompetence results from lack of commitment of leaders. Both the appraiser and appraise may nurture cynicism about 360 degree appraisal system. To manage cynicism, it is important to first implement 360 degree as a pilot project and allow organization members to experience the process.

Purpose of Appraisal: Employees who are evaluated by peers and managers, who are
evaluated by subordinates, all prefer that feedback by 360 degree appraisals should be used solely for development and feedback. But if upward appraisals have an evaluative component,

managers prefer appraisals to be kept anonymous. This controversy pertains to the old-age issue regarding the use of performance appraisal for evaluative as opposed to developmental purposes. The latter would like to use 360 degree appraisal for only developmental feedback.

Anonymity: This becomes issue in 360 degree appraisals. With a traditional appraisal,
anonymity is not an issue. The supervisor evaluates and shows the written appraisal to the subordinate, only to file it in personnel records. 360 degree appraisals, on the other hand incorporate upward appraisals, i.e. appraisals of employees .

Acceptability: Acceptability of 360 degree appraisals are affected by the extent to which
work is designed around teams. Traditionally, performance appraisals are designed around the jobs that are not related or dependent on other jobs or tasks. Since, co-workers are at the same organizational level, within the same group, they are likely to have closer interpersonal relationships and to be in direct competition for organizational rewards. Acceptability of coworkers increases when the group tasks and activities are highly interrelated and a group is operating as a team for solving problems.

Advantages of 360 Degree Appraisal

Lessens discrimination. Decreases biasness in evaluations Identifies areas that need improvement Gathers information from different organizational levels Presents the employees strengths and weaknesses

Disadvantages of 360 Degree Appraisal

Feedback can hurt. People can be malicious with criticism. There may be conflicting opinions. The employee may choose friends to give feedback. Are people being truthful in their responses?.

Behaviorally Anchored Rating Scales: Sometimes this is called Behavioral expectation

scales, are rating scales whose scales points are determined by statements of effective and ineffective behaviors. They are said to be behaviorally anchored in that the scale represent a range of descriptive statements of behavior varying from the least to the most effective. A rater must indicate which behavior on each scale best describes an employees performance. Behaviorally Anchored Rating Scales {BARS} have the following features: Area of performance to be evaluated are identified and defined by the people who will use the scales. The scales are anchored by descriptions of actual job behavior that supervisor agree, represents specific level of performance. The result is a set of rating scales in which both dimensions and anchors are precisely defined. All dimensions of performance to be evaluated are based on observable behaviors and are relevant to the job being evaluated. Since bars are tailor-made for the jobs Since the rates that will actually use the scales are actively involved in the development process, they are more likely to be committed to be final product.

Steps involved in constructing BARS

People with knowledge of the job to be appraised, such as jobholders and supervisors, describe specific examples of effective and ineffective behavior related to job performance. The people assigned the task of developing the instrument cluster the incidents into a small set of key performance dimensions. Generally, between five to seven dimensions account for most of the performance. While developing varying levels of performance for each dimension specific examples of behavior should be used, which could later be scaled in terms of good, average, below average performance? Another group of participants who are knowledgeable about the job is instructed to retranslate the critical incidents generated in step above. An incident in which there is less than 75% agreement with the first group is not retranslated. Each incident is then rated on one-to-seven scale with respect to how well it represents performance on the appropriate dimension. A rating of one represents ineffective performance; and a rating of seven indicates very effective performance. Rating is done on the basis of how well the behavior described in the incident represents performance on the appropriate dimensions. Mean and standard deviations are then calculated for the scale values assigned to each incident. Incidents that have standard deviations of 1.5 or less are included in the final anchored scales. A subset of the incidents that meets both the retranslation and Standard deviation criteria are used as a behavioral anchor for the final performance dimensions. A final BARS instrument typically comprises a series of vertical scales that are endorsed by the included incidents. Each incident is positioned on the scale according to its mean value.

Advantages of BARS
The ratings are likely to be accurate because these are done by experts. BARS typically requires considerable employee participation, therefore, its acceptance by both superiors and their subordinates may be greater. Thus, the ratings are accepted to be greater. Proponents of BARS also claim that such a system differentiates among behavior, performance and behavior is able to provide a basis of setting developmental goals for the employee. It is job-specific and identifies observable and measurable behavior hence it is more reliable and a more valid method of performance appraisal. The method is more reliable and valid as it is job-specific and identifies observable and measurable behavior. The raters bias is reduced. Systematic clustering of critical incidents helps in making the dimensions independent of one another. The method provides a basis for setting developmental goals for employee as it differentiates between behaviors, performance and results. The use of critical incidents is useful in providing feedback to the employee being rated.

Disadvantages of BARS
It is very time consuming and expensive to develop BARS for every job. Behaviors used are more activity-oriented than result-oriented. A specific deficiency is that the behaviors used are activity oriented rather than resultoriented. This creates a potential problem for the supervisor doing the evaluation, who may be forced to deal with employees who are performing the activity but not accomplishing the desired goals.

Human Resource Accounting Method: Human Resource is a valuable asset of any

organization. This asset can be valued in terms of money. When component and well trained employee leave an organization, the human asset is decreased and vice-versa.

HRA deals with cost and contribution of human resources to the organization. Cost of employee includes cost of manpower planning, recruitment, selection, induction, placement, training, development, wages and benefits etc. Employee contribution is the money value of employee service which can be measured by labor productivity or value added by human resources. Difference between cost and contribution will reflect the performance of employees.

Advantages of HR Accounting
It can foresee the changes in value, aptitude and attitude of human resources and accordingly change the techniques of interpersonal management. It provides different methods of testing to be used, techniques of interview to be adopted in the selection process based on the level of skill, qualification, value etc. of human resources. It helps to take steps to improve human resources contributions in the form of improved productivity. It aims to see that the human involvement in the organization is not wasted and brings high return to the corporate unit. It helps individual employee also to aspire for promotion, better benefits etc. It provides scope for advancement and development of employees by effective training and development.

It throws light on the strengths and weaknesses of the existing work force in an organization.

Disadvantages oh HR Accounting
There is no universally accepted method of human asset valuation In spite all its significance and necessity, tax laws do not recognize human beings as assets. The period of existence of human resources is uncertain and hence valuing them under uncertainty in future seems to be unrealistic. As human resources are not capable to be owned, retained and utilized, unlike the physical assets, there is problem for the management to treat them as assets in the strict sense.

Appraisal interview
The post appraisal interview has been considered by most of the organizations, as well as employees, as the most essential part of appraisal system. This interview provides the employee the feedback information, and an opportunity to the appraiser to explain. The employee his rating, the traits and behavior he has taken into consideration for appraisal etc. It also gives the opportunity to employee to explain his views, about the rates, standards or goals, rating scale, internal and external environmental causes for low level of performance, his resources responsible for performance, etc. Further, it helps both the parties to review

standards, set new standards based on reality factor And helps the appraiser to offer his suggestions, help, and guide and coach the employee for his advancement. Thus, the post appraisal interview is designed to achieve the following objectives:

To let the employees know where they stand. To help the employees do a better job by clarifying what is expected of them. To plan opportunities for development and growth. To strengthen the superior-subordinate relationship by developing mutual agreement of jobs.

Suggestions for Conducting Appraisal Interviews

Give the employees a few days notice of a discussion and its purpose Prepare notes and use the completed performance appraisal. Form as a discussion guide so that each important topic will be covered. Be ready to suggest specific developmental activities suitable to each employees needs. Establish a friendly, helpful and purposeful tone at the outset of the discussion. Assure your employee that everyone is being evaluated. Make sure that session is truly a discussion. When your appraisal differs from employees, discuss these to the employees. These discussions should contain constructive compliments and constructive criticism.

Types of Appraisal Interview


Tell and sell interview: The basic purpose of this interview is to:

let the employee know how well he is doing, gain the employees acceptance of the appraisal draw a plan of improvement for him.

The basic assumption behind providing appraisal feedback in this manner is that employees have some deficiencies and they need to be convinced about these deficiencies and how appraisers suggestions for improvement are relevant for overcoming the deficiencies. This type of appraisal interview is more appropriate for new and young employees who are inexperienced.

Tell and Listen Interview: The basic objective of this interview is to

communicate the appraisal results to the employee and then listen to his reactions sympathetically. For this purpose, the interview is divided into two parts:

The first point covers the strong and weak points of the employee work performance and The second part is used to thoroughly explore the employees feelings about the appraisal and the results.

Therefore, the interviewer acts as a non- directive counselor instead of dominating the decision. For conducting such an interview, it requires skills for careful listening, making effective use of pauses, responding to feelings to show understanding.

Problem-Solving Interview: In this interview, the basic objective is not just

to communicate the appraisal results to the employee but to invite him how he sees the problem and what action he feels necessary in order to overcome those problems. The interviewer stimulates the employee to think about improving his own performance. He does not supply remedies or solutions but considers all ideas on job performance improvements suggested by the employees.

Steps in Problem-Solving Interview Step 1. Prepare a base for communication:

This step is very necessary as it generates the necessary confidence in the subordinate and it assures him of his superiors genuine interest in helping him. For the success of this step it is necessary that the counselor carefully listens to what the subordinate says and displays warmth and responsiveness from his behavior.

Step 2. To Explore Information about the Performance:

During this stage the counselor puts to the subordinate various questions which may elicit elaborate information on the latters achievements, strengths, failures and shortcomings. The object is to make the subordinate himself introspect and define his strengths and weaknesses.

Step 3. To help define the future goal and internalize problem:

Once the counselor has succeeded in making the subordinate reflect on his strengths and weaknesses, he can easily make him realize what his problems are. There is generally a tendency to attribute ones failures, weaknesses to external reasons. The counselor has to help the subordinate to internalize the problem and its causes.

Step 4. To draw action Plan

Both the counselor and the subordinate jointly consider all possible alternative solutions to the problem. Their pros and cons are weighed and the best alternative is selected and the action plan is prepared along with a time table. The plan is reviewed by the two parties at regular intervals.

The term workplace feedback implies two things:

1) Job-Performance: Whether X is capably performing specific tasks that have been


2) Work-Related Behavior: The way X performs his tasks, whether X speaks politely
to customers and works cooperatively with other team members. The appraiser and the appraise need to follow certain things while giving and receiving feedback. These are discussed below: Adequate Preparation Describe behavior Proper timing Help both parties

Adequate preparation: The appraisal process should be continuous one. Informal sessions
could be held every now and then to put employee on track. Formal meetings could take place fortnightly, monthly or quarterly basis depending on the progress shown by the employee from time to time. When rates are rated on various jobs, the meetings could be held more frequently to clarify doubts. Such meetings should be conducted to create mutual trust, understanding and friendship.

Describe behavior: The rater should give detailed feedback to the employee. This involves
questions such as: What happened? Where and when did it occur? Who was involved?

How did it affect others?

Feedback should be well-timed. It should be given immediately after the event has

Proper timing:

taken place. For example: the statement, 3 weeks ago I passed you in the corridor; you didnt

say hello- does not serve the purpose as the recipient has no interest to reflect on the event unless the results are negative. Timing also means that the recipient of the feedback should be in a position to receive feedback and use it.

Help both parties: To be effective, feedback should satisfy the needs of the rater as well as
the rate. The rater may want to help, to influence and to establish a better relationship. To this end, he must move closer to the rate, understands his problem and suggest remedial steps in a friendly tone. The rate on his part should listen to the feedback information given by the rater carefully. There is no use of overreacting to feedback. When the rate is praised for showing talent and promise, he should not take it for granted that he does no wrong. A negative comment

of rater should not influence the rates behavior too badly. The rate should keep all feedback in perspective and learn from all such information without writing off inappropriate feedback as rude and obnoxious. The rate should remain calm and cordial throughout the feedback session.

Research Methodology
Research Methodology is a way to systematically solve the research problem. It may be understood as a science of studying how research is done scientifically. Research methodology is a tool for obtaining information for the purpose of the subject of the study. The process Requires data i.e. Primary and Secondary data about user perception and attributes for analyzing data. Research Methodology helps in studying various steps that are generally adopted by researcher in studying the research problem along with the logic behind it. The first step of research methodology of HR department for the topic questionnaire about different kinds of systems including data and procedure of each segment that helped me to know in details. Apart from this the second part of this methodology has been envisaged through direct studies. This also helped to know the advantage and disadvantage and the difficulties faced by HR department for fixing Performance Appraisal. For the above mentioned difficulty, a hypothesis is being taken which entitles that HR department for retaining its employees in the organization avails every system of appraisal that can make the human resource of this organization highly satisfied and the frequent labor turnover is not desirable.

Defining the problems

The results of the appraisal system should be followed up through a set of well designed and enforced policies, and translated into rewards and punishments. Performance of researchers is sometimes difficult to assess. A research manager has to balance between researchers' creativity and organizational goals. Researchers do not like others passing judgment on qualitative or quantitative aspects of their work, yet the need for an effective performance planning and appraisal system in a research organization is well accepted.

Type of Research:
The type of research undertaken is purely qualitative in nature.

Sources of Data Collection:

The sources of data collections are:

Primary Data: Primary data has those data that are collected originally and are first hand
information. They are the fresh data and are collected for the first time and thus happen to be original in character. There are several methods for primary data. Some of the methods are: Direct personal interview Indirect personal interview Information from employees Questionnaire to be filled by executives and non-executives.

In finding the information for pay and compensation of employees, research has been done by collecting data from primary sources and secondary sources. A questionnaire has been prepared with the helped of which various information is obtained.

The methods of data collection to be decided are according to the objectives and nature of the research as well as the available information. For this knowledge of all methods and their limitations is a very essential while collecting the data, core has to be taken, the data should cover the entire subject under hypothesis and accuracy with its corrections and unbiasness. A sample size of 100 employees is studied for this purpose. Employees of different unit were randomly administrated the questionnaire.

Secondary data are those data that have already been collected by someone else and which have already been passed through the statistical process. In secondary sources the data may be published or unpublished. In my project the sources of secondary data are obtained through: Text books Brochures Graphical presentation and pie charts Internet web sites

The analysis of data was done on the basis of unit, age and number of years of experience and factors. Analysis was done using the simple average method so that, findings of the survey was easily comprehensible by all.

Primary as well as secondary data was collected.

Conducting a field survey did a subjective assessment of the collection of primary data which contained open-ended questions to chance response. In addition the personnel interview method was employed to draw out answers to subjective questions, which could not be adequately answered through the use of questionnaire.

100 employees: basic unit containing the elements of the population to be sampled (Ghaziabad)

sample size of 100 employees.


The first task in the process of measuring level of recruitment of the candidates in PepsiCo was to prepare questionnaire. For this purpose a number of questionnaire we studied and finally a questionnaire where framed. The questionnaire where grouped under five categories: Company level Environment related Supervision related Growth related

Job related

The questionnaires are also asking the employee for the demographic details: Age Sex Work experience

As we know that the technique of performance appraisal is the process of assessing the performance of an employee on a given job. How far is it true practically? 50% - YES 2. 35% - NO 3. 15% - NIL

Are you satisfied the existing appraisal procedures? 70% - BEST 2. 20% - GOOD 3. 10% - NOT SATISFIED

After how much period of time, appraisal of performance is done? 50%- 6 MONTHS 2. 30%- 7 MONTHS 3. 20%- 5 MONTHS

Does the process of Performance Appraisal provide a platform for the employees to know their strengths and weaknesses?
55% says YES 2. 35% says NO 3. 10% says DONT KNOW

Does performance an employee helps in promotion decisions? 60% says YES 2. 25% says LITTLE BIT 3. 15% says NO

The new system has been designed for all the officers level keeping in mind all the pitfalls of the existing system. It is an almost perfect system. But certain actions taken , can make the implementation of the system smooth and easier. It would have added benefits to it. Various promotional strategies should be adopted by the organization in order to spread awareness among employees gain confidence. This would help in smooth functioning of the department. The benefits and advantages of the system should be aware of the benefits attached to it, they would be apprehensive to change. They should also know the pros and cons of the system. Nothing should be deliberately kept confidential which are concerns of the employees.

On the basis of the questionnaire and direct personal interview, it can be concluded that the PERFORMANCE APPRAISAL of employees in PepsiCo is an integral part of the organization and plays a vital role. PERFORMANCE APPRAISAL as a management tool can be used broadly as a control tool or as a developmental tool or as a balanced mixture of both. The emerging philosophy worldwide is to leverage the potential of APPRAISAL process in providing clues to the developmental requirements of employees. A good PERFORMANCE APPRAISAL process provides for not only evaluation of an employees performance but also identification of his competency gaps to enable the organization to bridge them through appropriate development initiatives, the ultimate objective being to continually prepare employees for occupying the higher echelons as they progress in their career. With the analysis, interpretation and study of the PERFORMANCE APPRAISAL process of employees in this project report. It can be said that the HR department enjoy a lively role because they have to retain the qualified and workable employees. For such retention of workers, the department faces the challenge to motivate them to provide their best services. Thus, HR is very capable and successful in terms of providing better environment and better working conditions. Also HR plays a crucial role in

PERFORMANCE APPRAISAL but in its other functions too like in its training and development program, pay and compensation allowances, etc.


As we know that the technique of performance appraisal is the process of assessing the performance of an employee on a given job. How far is it true practically? After how much period of time, appraisal of performance is done? To what extent does the Performance Appraisal motivate the employees in terms of productivity? Does the attitude of supervisors towards subordinates and working conditions affect the performance of the employees? Does the behavior of employees towards their superiors and subordinates have any impact on the performance of a candidate? What is the reaction of the employees when standards are established and communicated to them? What are the key elements which are kept in mind while establishing the standard of performance? If an employee is punctual but is not able to achieve the targets on time while another employee who is not punctual achieves the set target then who will be appraised? Does the process of Performance Appraisal provide a platform for the employees to know their strengths and weaknesses? Does performance an employee helps in promotion decisions? What are the actions taken up by the management in improving poor performers in case actual performance is not equal to the desired performance?

How much time is given by the counseling committee to the poor performer to show the improved performance so as to avoid demotions and downsizing?

How far the supervisors or assessment centers play a fair deal in assessing the performance of and employee?

Does the length of service and quality of production have any effect on the performance of an employee?

If an employee participates in the socio cultural values of the environment then does it has any impact on performance?

What are the prospects of growth and development for employees in the organization?

What are the benefits provided to the employees in performance appraisal? What are the main techniques used in appraising the performance of a candidate?

What are the problems faced by the appraiser in assessing the performance? In your esteemed organization, Is their any scope for poor services through good performers guaranteeing them appraisals and performance?

How 360 degree performance appraisal is applied in the firm?


Quarter: II/III/IV Date: ././.

Appraisal Form: Probationer Period:

1st Quarter 2nd Quarter

Last Appraisal: ....././.

Name of Probationer: . Probationer Code: Date of Joining: ...../../.. Basics: Punctuality Attendance Attire
Shoes Cap Clothes : : : Yes Yes Poor No No Satisfactory Good

: Poor :

Satisfactory Irregular


Looks clean and neat : Poor Satisfactory Good

On the shop-floor Behavior with superiors : : Poor Poor Satisfactory Satisfactory Good Good

Performance/ Progress Report: Jobs Assigned:

Light Inspection / Bottle Washer Operator / Filler / Maintenance/ Caser / Uncaser /

Housekeeping / Para mix / Hygiene / Other

Please Comment on: Knowledge of work and quality of job .. Areas of Strength: Opportunities: Overall:
Poor Satisfactory Good

Should he be confirmed?
Yes No will need more time to assess Signature HOD: Date: Extend Probation Period Signature HR Manager: Date:

Signature of Appraiser Name: Designation: Date:

General Information: Name Address Telephone No.. Email Occupation Gender Status ( ) Service ( ) Male ( ) Married ( ) Business ( ) Female ( ) Unmarried

Number of members in the family ( ) 1 to 3 ( ) 3 to 6 ( ) Over 6

Monthly Income in rupees ( ) Below 8000( ) 8000-16000 ( ) 16000-30000 Q.1. ( ) Above 30000

Is the promotional policy well defined in your organization? a. Yes b. No c. can't say


Do you know the objectives of the Performance appraisal system. If yes kindly specify.


How often the performance appraisal form is filled or Performance Appraisal is done. a. e. fortnightly. not fixed. b. monthly c. six-monthly. d. annually


On what basis is the performance appraisal done. a. merit cum seniority b. seniority cum merit. c. merit only


seniority only. e. any other. Pl. specify

Q.5 Who appraises you? a. c. e. Q.6. appraisal committee. self-appraisal any other please specify b. d. your immediate supervisor 360 degree appraisal.

What methods are being used for performance appraisal a. c. e. forced choice distribution method. ranking method. any other, kindly specify b. d. essay method critical incident method


In your opinion does it identify the training needs? a. to a large extent b. to some extent c. cant say d. not at all


Is the promotional policy linked with the performance appraisal system a. yes b. no c. can't say

Q.9. Are the issues like career planning and succession planning a part of company's policy a. yes b. no c. can't say.

Q.I0 Does the system help you in aligning your goals with those of the organization. a. Q.11. Q.12. yes b. no c. can't say

What role does top management play in the performance appraisal. kindly comment. Are you a part of the appraisal committee a. yes b. no

Q 13 . Do the employees get the feedback of performance appraisal a. c. d. Q.14 yes, every time. only when required rarely e. never b. often, but not always.

Does the organization provide counseling after the appraisal. a. always b. often c. rarely d. never. e. can't say.


Who does the counseling a. trained professionals b. untrained counselors. c. can't say


What kind of remedial measures are taken. a. job rotation b. sent to training programmes c. counseled

d. any other, kindly specify Q.17. How do you rate the overall assessment of performance appraisal a. Outstanding e. Poor Q18. As we know that the technique of performance appraisal is the process of assessing the performance of an employee on a given job. How far is it true practically? b. Very good c. Good d. Satisfactory

a. YES

b. NO

c. NIL

Q19. Are you satisfied the existing appraisal procedures?




Q20. After how much period of time, appraisal of performance is done? a. 6 MONTHS b. 7 MONTHS c. 5 MONTHS

21. Does the process of Performance Appraisal provide a platform for the employees to know their strengths and weaknesses? a. YES b. NO c. DONT KNOW

22. Does performance an employee helps in promotion decisions?

a. YES


c. NO