Yamaha HR

Performance Appraisal System at YAMAHA
COMPANY PROFILE
Yamaha Motors Escorts Ltd. was a joint venture company formed by the alliance
of Escorts Ltd. and Yamaha. The flagship company of Rs. 3600 crore Escorts
group a major plant in the engineering industry in India including two wheeler
business and Yamaha Motors Corporation, Japan. 26,400 crore global giant in
two wheeler with 60 facilities in 45 countries.
The company started operating in 1985 as Escorts Ltd. (Yamaha Motor Cylinder)
its first product in road. In 1996 it became a joint venture with equal share of
50:50 with Escorts group. India and YMC, Japan and was named Escorts
Yamaha Ltd. In August 2000, Escorts group sold its 24% stakes to YMC Japan
and the joint venture again changed to one sided domination and the name of the
company became Yamaha Motors Escorts Ltd. Though not an ISO certified
company but still the company has kept and sustained very good quality
standards in its working and products.
The company became 100% Japanese on 1 st August 2001 and the name finally
changed to Yamaha Motor India Pvt. Ltd.
Important facts about Surajpur and Faridabad Plant.
1.
Surajpur plant was established in 1985.
2.
Faridabad plant was established in 1965.
3.
The turnover of Surajpur plant is around 702 crores as compared to 208

crores in Faridabad plant.
4.
The volume of Motorcycles procured in numbers is 211913 in Surajpur

plant in the year ending 31st Dec 2001 and in Faridabad plant it was
77,200.
5.
Manpower in Surajpur plant is 1048 and compared to 1946 in Faridabad

plant.
1

6.
The average age of employee in Surajpur is 35 years where as 45 years

in Faridabad plant.
7.
There are about 950 machines used in Surajpur plant whereas 600
machines in Faridabad plant.
8.
Total land area in Surajpur is 351385 sq.mtrs. in Faridabad it is 1,21,674

sq.mtrs.
9.
The building area of Surajpur in 54,815 mts. And the building area of
Faridabad plant is 50678 sq.mtrs.
OBJECTIVES OF THE COMPANY

1.
Chief profitable conditions in mid term plan.
2.
No further investment in mid term.
3.
Continuous improvement in daily production (quality distribution and cost).
4.
Motivated and charged up employees.
The strength of YMIL lies in being a customer driven company. The countrys
largest network of nearly 10958 dealers in two wheeler industry starting with RX100, RXG, RZ-135, YBX 125, YD125, YD110 (Crux) it came up with a recently
launched model Enticer & Frazer
YAMAHA'S MISSION
THE MORE HEARTS YOU REACH. THE MORE HEARTS YOU TOUCH
YMIPL is a new company serving the customer needs by following Yamaha
Motors corporate mission of creating "Kando"- a Japanese word that means
-"Touching people's Hearts".
It is best way to describe an experience that both moves and inspires. Kando
also describes our spirit of challenge to create new value surpassing customer
expectations.
YMIPL is committed to make products that benefit from the skills and technology
used by the Yamaha world wide. To fulfill customer satisfaction and meet the
needs of Indian market YMI plans to produce one or more model in the first year,
four models in three years.
To achieve this goals YMI will pursue 3 major objectives within the company.
The first is customers satisfaction. YMI is trying to do whatever is necessary to
improve their dealer network to make its customers comfortable while dealing
with Yamaha Motors.
The second is strengthening research and development It is the mission of YMI
to constantly produce what customers are looking for by analyzing market trends
and changes.
In this regard its motto is "Speed, Quality, Yamaha's original design.
The third objective is optimizing the internal working system. One of the policy of
YMI is that all its employee work together as one, aiming at a common goal.
YAMAHA : The Kando Company is aiming to make a significant contribution to
the Indian society and create products that the people of India will take to their
hearts.

The company strive to be the strongest and most respected engineering concern
in the country.
This is achieved by clearly positioning itself in a competitive environment
enhance its brand equality products, market leadership, enlarged customer base,
better cost controls and pricing opportunities.
They feel responsible towards their employees. They believe to respect their
dignity and recognize its merit. Each employee upholds the core values of
professionalism, commitment and integrity in keeping with the highest traditions
of the company
Wage and Salary Administration of YMIL
At YMIL there are two types of employees
1. The hourly rated workers (HRW's)
2. The monthly rated employees (MRE's)
The HRW's are given salary on the basis of the number of hours they work.
They are further divided into :1. Direct HRWs
2. Indirect HRWs
Direct HRWs are those which are directly involved with the production. Indirect
HRWs are those employees who are not directly involved with the production.
The HRWs belong to the bargainable category. They are workers and the
contract labourers who come under the trade unions.
The MREs are given the salary on the basis of the number of days they work.
The MREs bargainable are the peons, clerks and junior workers. The MREs nonbargainable are staff members, managers and officers.
4

The Wages and Salary of the workers depend on their basic. The HRWs and
MREs are given grades as per the OB done by them. At YMIL, the basic for
every grade is increased after negotiations with the trade union of the company
and the management. The basic wages and salary can be computed as follows.
HRW Basic Wages = No. of hours of work * Wages/Hour.
MRE Basic Salary = No. of days of work * Salary/Day.
No. of hours of work in a month for HRW is 208.
No. of hours work for MRE is 196 hours.(certain departments) and for some it is
208 hours.
The following are the grades given to employees along with their wage scales.
Salary Scales of MRE
Grade Basic Salary/month
E2 2224
E3 2714
E4 2714
E5 2681
E6 2717
E7 2717
E8 2622, 2852
E9 2719
E10 3153, 3471
2894
2988
5
Statement showing Emoluments:

Workmen and staff:
s.no
Particulars
Amount (Rs.)
1.
Basic (/month)
2.
Night Shift Allowance(/day)
15
3.
4.
5.
6.
7.
Washing Allowance (/month)

Tea Allowance (/month)
Milk Allowance (/month)
DA
Personal Pay (/month)
20
25
35
2386.85
1. Direct Link With
Production = 600
2. Indirect Link With
8.
Incentives (/month)
1.
Production = 423
Direct Link With
Production (100%) =
3850
2. indirect Link With

Production (70 %) =
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
HRA (/month)
Conveyance Allowance (/month)
Eqva. Allowance
Educational Allowance (/month)
LTA (/annum)
Medical Allowance (/annum)
Overtime
2695
1610/1620/1630
740
550
200
5112
3300
Twice of Basic + PP + DA (as
Bonus
per factory act)

As per the company
Canteen Allowance
Monthly Attendance Bonus
Uniform cotton
Shoes
performance.
NA
NA
3 pairs a year.
2 pairs a year.

Supervisors :
S.no
1.
2.
3.
4.
5.
6.
7.
Particulars
HRA
Conveyance Allowance (/month)
Night shift Allowance
DA (/month)
Medical Allowance (/annum)
LTA (/annum)
Bonus
Amount(Rs.)
50 % of the basic +DA +PP
1800
50 (10 PM 5 AM)
3700
One month basic
1 of basic
As per company
performance
OBJECTIVE OF THE STUDY

The main objective of the study is:
7

1.
To critically analyze the performance appraisal system in Yamaha Motors

India Pvt. Ltd.
2.
To gain familiarity with the organizational environment and the work

culture existing in the organization.
3.
To study the personnel environment
4.
The purpose of the study is to evaluate the impact of performance

appraisal system carried out in this organization.
5.
It is to see how the present performance appraisal system has contributed

to the efficiency and effectiveness of the employees in the organization.
6.
The objective of the study is also to feel the pulse of the employees views
and other suggestions.
Finally, to observe the short comings of the appraisal system in the organization
and suggest ways to overcome them so as to enhance the performance of the
employees in the organization.
RESEARCH METHODOLOGY
The research was carried out by keeping in mind the objective of the study for
this purpose both the primary data and the secondary data was collected so that
a proper analysis can be done.
For secondary data the reference from the previous years research files &
employees handbook, and the material provided by the company was taken but
for primary data a questionnaire
was prepared and distributed both to the
managers and workers. A sample of 50 was collected more over some personal
interviews were also done with the employees to get the proper insight of the
system.
INTRODUCTION TO PERFORMANCE APPRAISAL
HISTORY OF PERFORMANCE APPRAISAL SYSTEM

Employee appraisal techniques are said to have used for the first time during the
first world war, when at the instance of Walter Dill Scott, the US army adopted the
man to man rating system for evaluation of military personnel. During 1920-30
period, relational wage structures for hourly paid workers were adopted in
industrial units. Under this system, the policy of giving grades wage increments
on the basis of merit was accepted. These early employee plans were called
"Merit rating programs" which continued to be so called up to mid -50s. By then,
most of these plans were of the rating scale type, where emphasis was given to
factors, degrees and points. In the early 50s however, attention began to be
devoted to performance appraisal of technical, professional and managerial
personnel. Since then, as a result of experiments and a great deal of study, the
philosophy of performance appraisal has under gone a tremendous change.
Consequently, a change has also taken place in the terminology used. Now, the
older phrase "Merit rating" is largely restricted to the rating of hourly paid
employees and is used frequently in developing criteria for salary adjustments,
promotions, transfers etc.. The later phrase, "Personnel appraisal
place
emphasis on the development of the individual as and widely used to evaluate,

technical, professional and managerial personnel.
MEANING
Performance appraisal is a method of evaluating the behaviour of employees on
the work spot, normally including both the quantitative and qualitative aspects of
job performance. Performance here refers to the degree of accomplishment of
the task that make up an individuals job. It indicates how well an individual is
fulfilling the job demands. Some of the important features of performance
appraisal may be captured as follows:
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1.
Performance Appraisal is a systematic description of an employee's job

relevant strengths and weaknesses.
2.
The basic purpose is to find out how well an employee is performing the
job and establish a plan of improvement.
3.
Appraisals are arranged periodically according to a definite plan.
4.
It is a continuous process in every large scale organization.
DEFINITIONS
"Performance Appraisal has many facets. It is an exercise in observation and
judgment. It is a feedback process and it is organizational intervention. It is a
measurement process as well as an intensely emotional process. Above all, it is
an inexact, human process. While it is fairly easy to prescribe how the process
should work, descriptions of how it actually works in practice are rather
discouraging."
Wayne F. Cascio
Managers often believe that the most significant performance of HR outcome
involves the contribution employees make to the organization's goal attainment
These contributions are called employee performance, meaning how effectively
employees carry out their job responsibility"
Herbert G. Heneman
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NEED OF PERFORMANCE APPRAISAL

Performance appraisal is needed in order to :
1)
Provide information about the performance ranks basing on which

decisions regarding salary fixations, confirmation, promotion, transfer and
demotion are taken.
2)
Provide feedback information about the level of achievement and

behaviour of subordinates. This information helps to review the
performance of subordinates, rectifying performance deficiencies and to
set new standards of work, if necessary.
3)
Provide information which helps to counsel the subordinates.
4)
Provide information to diagnose deficiency in employees regarding skill,

knowledge, determine training and developmental needs and to prescribe
the means for employee growth, provides information for correcting
placement
5)
To prevent grievances and indisciplinary activities.
12
PURPOSE
Performance appraisal aims at attaining different purposes. They are:
1)
To create and maintain a satisfactory level of performance.
2)
To contribute to the employees growth and development through training,

self and management development programs.
3)
To help the superiors to have a proper understanding about their

subordinates.
4)
To guide the job changes with the help of continuous ranking.
5)
To facilitate fair and equitable compensation based on performance.
6)
To facilitate for testing and validating selection tests, interview techniques

through comparing their scores with performance appraisal ranks.
7)
To provide information for making decisions regarding layoff, retrenchment

etc.
8)
To ensure organizational effectiveness through correcting employee for

standard and improved performance, and suggesting the change in
employee behaviour.
13
CONTENT OF PERFORMANCE APPRAISAL

Every organization has to decide upon the content to be appraised before the
program is approved. Generally content to be appraised is determined on the
basis of job analysis. Certain contents to be appraised for an officer's job are:
1)
Regularity of attendance
2)
Self expression -written and oral
3)
Ability to work with others
4)
Leadership styles and abilities
5)
Initiative
6)
Technical skill
7)
Technical ability/knowledge
8)
Ability to grasp new things
9)
Ability to reason
10)
Originality and resourcefulness
11)
Creative skills
12)
Area of interest
13)
Area of suitability
14)
Judgment skills
15)
Integrity
16)
Capability for assuming responsibility
17)
Level of acceptance by subordinates
14

18)
Honesty and sincerity
19)
Thoroughness in job and organizational knowledge
20)
Knowledge of systems and procedures
21)
Quality of suggestions offered for improvement
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METHODS OF PERFORMANCE APPRAISAL

With the evolution and development of appraisal system, a number of methods or
techniques of performance appraisal have been developed.
METHODS OF PERFORMANCE APPRAISAL

Traditional Methods
Modern Methods
Graphic rating scales
Behaviourally anchored rating scales

(BARS)
Ranking method
Assessment center
Paired comparison method
Human resource accounting
Forced
distribution
method Management by objectives (MBO)
Management by objectives
Checklist methods
a)
Psychological appraisal
Simple
checklist
b)
Weighted
checklist
c)
Critical
Incident method
Essay or free from appraisal

Group appraisal
Confidential reports
USES OF PERFORMANCE APPRAISAL

1)
Performance improvement
16

Performance feedback allows the employee, manager and personnel
specialist the employee, manager and personnel specialist to intervene
with appropriate actions to improve performance.
2)
Compensation adjustment
Performance evaluation helps decision makers determine who should
receive pay rises. Many firms grant part or whole of their pay increases
and bonuses based upon merit which is determined mostly through
performance appraisal.
3)
Placement decisions
Promotions, transfers and demotions are usually based on past and
anticipated performance. Often promotions are a reward for past
performance.
4)
Training and development needs

Poor performance may indicate the need for retraining. Like wise good
performance may indicate untapped potential that should be developed.
5)
Career planning
Performance feedback guides career decisions about specific career
paths one should investigate.
6)
Staffing process deficiencies

Good or bad performance implies strengths or weaknesses in the
personnel department's staffing procedures.
7)
Informational inaccuracies
Poor performance may indicate errors in the job analysis information,
human resource plays or other parts of personnel management
17

information system. Reliance on inaccurate information may have led to
inappropriate hiring, training and counseling decisions.
8)
Job design errors

Poor performance may be a symptom of ill conceived job designs.
Appraisals help diagnose these errors.
9)
Equal employment opportunities

Accurate performance appraisals that accurately measures job related
performance ensure that internal placement decisions are not taken
inaccurately.
10)
External challenges
Sometimes performance is influenced by factors outside the work
environment such as family, financial, health or personal matters. If
uncovered through appraisals, the human resource development may be
able to provide assistance.
11)
Feedback to human resources

Good/bad performance through out tile organization indicates how well the
human resource function is performing.
18
LIMITATIONS OF PERFORMANCE APPRAISAL

The major problems in performance appraisal are:
I.
The halo effect or error

The halo effect is a tendency to led the assessment of an-individual one
trait influence the evaluation of that person on other specific traits. There
is this effect in appraisal when the appraiser assigns the same rating to all
traits regardless of an employees actual performance on this traits.
II.
Leniency or strictness tendency or constant errors

Every evaluators has his own value system which acts a standard against
which he makes his appraisals. The leniency bias crops when some raters
have a tendency to be liberal in their ratings by assigning high rates
considerably. Such ratings do not serve any purpose.
III.
Central tendency problem

It is the most commonly found error. It assigns average ratings to all
employees with a view to avoiding commitment or involvement or when
the rater is in doubt or has inadequate information or lack of knowledge
about the behaviour of the employee.
IV.
Similarity error
This type of error occurs when evaluators rates other people in the same
way he perceive himself. For e.g., the evaluator who perceives himself as
aggressive may evaluate others by looking for aggressiveness. Those
who show this characteristic may be benefited while others may suffer.
19

V.
Personal prejudice
If the rater dislikes any employee or any group, he may rate them at a
lower end which may distort the rating purpose and effect the career of
this employees.
VI.
The regency effect

The raters generally remember the recent actions of the employee ate the
time of rating and rate on the basis of these actions, favourable or
unfavourable rather than on the whole activities.
VII.
Social differentiation
Rating is sometimes impeded by the evaluators style of rating behaviour.
There can be high differentiators who use all or most of the scale or low
differentiators -who use a limited range of the scale
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LAUNCHING A APPRAISAL PROGRAM

Performance appraisal form a line responsibility to be accomplished with advice
and help of personnel department. It is likely to be an utter failure if it lacks the
support of management, if the superiors are not adequately trained or have no
trusts in its value, if the results of performance appraisal is not used to serve the
purpose for which it is meant. Therefore, several steps may be taken to develop
and administer the program effectively.
1.
The personnel department may attempt to obtain the maximum agreement

of line management in respect of needs and objectives of the program.
2.
The personnel department has to examine the plans of other

organizations as well as the relevant literature applicable in the field to
formulate the most suitable plan for the appraisal program.
3.
Attempt should be made to obtain the cooperation of supervisors in

devising the appraisal form and to discuss with them different factors to be
incorporated, weights and points to be given to each factor and
descriptions or instructions to be indicated on the form.
4.
The personnel manager should tend to explain the purpose and nature of
the program to all superiors and subordinates, to be involved and affected
by it. Care should be taken to take into confidence the trade union
representatives of the company.
5.
Attempt should be made to provide intensive training to all the supervisors

with a view to obtain unbiased, uniform appraisal of their subordinates.
6.
Care should be taken to acquire line and staff coordination and mutual
checking of appraisals to obtain intra departmental and inter-departmental
consistency and uniformity.
7.
There should be an arrangement for periodic discussion for appraisal by

the superiors with each of the subordinates where attempts may be made
21

to stress good points, indicate difficulties and encourage improve
performance.
8.
As soon as the appraisal has been duly discussed attempt may be made
to recommend for salary increases and promotions.
9.
There should be a provision for challenge and review of the appraisal if

the employees or their union representative are dissatisfied with the
personnel decisions which the management has taken on the basis of
these appraisals.
These steps if followed carefully are likely to help the superiors to evaluate their
subordinates effectively.
22
STUDY OF PERFORMANCE APPRAISAL IN THE

ORGANIZATION
PERFORMANCE AND POTENTIAL DEVELOPMENT SYSTEM
(PPDS PHILOSOPHY)
PPDS is based on the following philosophy and premises:
1.
Performance appraisal is the most crucial element off the overall process
of performance planning both at organizational level and at level i.e.
between the appraiser and appraisee.
2.
Achievement of results by itself is only half the picture unless the appraisal
is benched marked against appraisee's contribution to the company.
3.
The process of achieving results is as important as the achievements

themselves to keep in focus both the short term and long term costs and
benefits.
4.
Unleashing the human potential in any collaborative endeavour rests on

the process of opening opportunities, providing challenges, involvement,
continuing feedback and guidance. This, however, must be in conjunction
with the assumption of responsibility for: development and growth by the
individual himself.
PERFORMANCE REVIEW AND POTENTIAL ASSESSMENT

1.
All confirmed employees as at the end of the financial year will be

appraised by their designated appraiser.
2.
Where an employee has worked under two or more officers in any

financial year, the appraisal will be done by the last officer subject to the
minimum service under the appraiser being 3 months. Otherwise, the
appraisal will be done by the previous reporting officer. Where the
23

previous reporting officer has left the service of the company and the
appraisee-appraiser relationship is less than3 months, the appraisal will
be done jointly by the current reporting officer and his superior.
3.
Performance review is a joint process between the appraisee and the

appraiser. This joint process will also focus on the emerging training needs
and development plans.
PERFORMANCE COUNSELLING
In the above context, the role of performance feedback and counseling is the
most critical component of the appraisal process in enhancing the effectiveness
of the total exercise for triggering higher levels of performance. It is therefore
envisaged that the performance reviewed will not be complete until and unless
counseling has taken place. The appraiser and appraisee may record their
reactions to the counseling process, if they wish so.
PERFORMANCE OBJECTIVES
The climate of sharing arrived in performance counseling will be used for at least
tentatively identifying the, next years performance objectives, these objectives
however may be revisited and fine tuned incase of delayed finalization business
plans or any other factor subsequently necessitates so. This must be followed by
at least one mid-year review.
To distinguish performance objectives from the various activities being carried out
by an individual during the course of his work, it is necessary that these
objectives be restricted to a maximum of five.
To assist managers, a sample list of indicators on the basis of which these
objectives should be firmed up in various functions is being enclosed in Annexure
"A". This list is only illustrative and not exhaustive. Nor is it applicable every
where. Identification of objectives for each positions will take into account the
specific nature of the job, performance expectations and so on. Care must also
24

be taken to include at least one performance objective which should focus on
some innovative effort, for e.g. modifying the system/process and the like.
PERFORMANCE RATING
Performance rating will be, done on the following scale:
VERY GOOD: A
The employee has far exceeded acceptable levels of performance with
excellence and creativity. His contribution to the company far exceeds
targets/expectations and such an employee is a very valuable asset to the
company.
GOOD: B+
The employee generally exceeds acceptable levels of performance. His
contribution
generally
exceeds
targets/expectations.
Such
an
employee
contributes substantially to the company.
ACCEPTABLE: B
The employee meets acceptable level of performance. His contributions meets
expectations but needs occasional guidance/follow up. Such an employee
contributes reasonably to the company.
BARELY ACCEPTABLE: C+
The employee needs urgent improvement to achieve acceptable levels of
performance. Work is often accomplished by unduly relying on others to solve
Problems and requires considerable guidance, supervision and follow up.
25
NOT ACCEPTABLE: C
The employee slips despite guidance and follow up. He is clearly a burden on the
company in the sense that his contribution does not justify his cost to the
company.
POTENTIAL ASSESSMENT
Potential assessment will be based on certain key competencies relevant to the
appraisee's present job and the likely higher responsibilities he may occupy.
These competencies are as follows. Even though all competencies may not be
relevant for all positions/functions and wherever the appraiser is convinced that
any particular competency is not relevant, he may choose not to appraise on the
same. The appraiser may also add any other relevant competencies not listed.
The appraiser should rate appraisee in terms of high/medium/low and should
also give specific reasons for such ratings.
1.
Achievement orientation
The degree to which an employee is result focused and has the desire to
achieve in the face of difficulties/obstacles, through creative use of mind,
time and resources.
2.
Leadership/man-management ability
The degree to which an employee has the capability to motivate and
energize his subordinates and colleagues for achievements of goals -the
degree to which he is able to resolve man management problems of his
group. Leadership ability will be specially more important than man
management ability at relatively senior levels.
26

3.
Decisiveness
The extent to which the employee has the willingness and the ability as
well as the track record of taking his own decisions, rather than waiting for
guidance/instructions from higher ups.
4.
Developing others
To what extent does the employee take appropriate steps to develop his
subordinates including delegating challenging task, counseling, mentoring,
and involving them in developing team goals.
5.
Team work and networking

How good is the employee a team player rather than a soloist? Does he
have a good network of productive contacts within and outside the
organization which may help ill achievement of his work goals?
6.
Optimism
To what extent the employee essentially and Instinctively focuses on the
brighter side of the possibilities rather than getting upset. .
7.
Pro-action/Initiative
How good is the employee's anticipation of developments and how does
he initiates preventive! Pre-emptive actions to better manage emergent
situations.
8.
Listening skills
How active and patient listener the appraisee is? How do his subordinates
and colleagues perceive his competency as a listener?
9.
Presentation skills
To what extent is the employee able to effectively, vividly and persuasively
present his ideas to superior, subordinates, colleague and customer.
27

10.
Striving for learning

To what extent the employee has insatiable desire to learn more on
aspects related to his job and beyond? Does he have been inquisitive
mind?
11.
Analytical Ability
To what extent is employee able to see the big picture and analyze
most/all implications in detail?
12.
Customer orientation
To what extent is the employee oriented to the needs of his
internal/ultimate customer rather than focusing on achievement of his
results only.
13.
Limiting factors.
Does the employee suffer from any physical/mental infirmity which may be
a handicap in performance of higher responsibility? For e.g. if his future
responsibilities may require extensive touring, does he suffer from any
health! personal problems which may prevent him from doing so? If his job
involves public dealing then is he quickly irritated.'
The appraiser may also note down for consideration of the concerned, if
he feels that the employee is adversely placed vis-a-vis colleagues in view
of his capabilities, qualifications, experience etc. due to historical or any
other reasons.
28
SAMPLE
INDICATORS
FOR
DEVELOPING
OBJECTIVES
Marketing:
1.
Sales quantity.
2.
Extra/short fall in contribution.
3.
Revenue realization in average no. of days.
4.
Hit rate(conversion of prospects into orders)
5.
Territory/channel development
Service:
1.
Customer complaint satisfaction ratio.
20.
Response time.
03.
Return ratio of defects rectified in field.
4.
Service camps
6.
Mechanical training
Production:
1.
Quantity
2.
Rejection quantity/cost percentage.
3.
Manpower utilization per equipment/product.
4.
Material utilization.
5.
Delivery schedules.
6.
First time pass rate.

29
PERFORMANCE
HR/IR:
1.
Response time for services/facilities rendered.
2.
Man hour lost due to unrest/work stoppage.
3.
Labour cost
4.
Absenteeism/discipline/turnover.
5.
Statutory compliances.
Finance:
1.
Response time and error rate in services rendered.
2.
Statutory compliances.
3.
Accounts closing schedule.
4.
Budget formulation/adherence.
5.
Timely MIS
6.
Funds management- cost of procurement, funds availability.
7.
Tax saving/planning
8.
Audit checks/compliance
R&D:
1.
No. of ideas generated/converted based on feedback/own ideas. 2. Value

engineering -savings made.
3.
Prototype/product development
4.
Patents applied.
5.
Documentation
30
Quality:
1.
Quality cost Including man power.
2.
Defect rate in passed quality
3.
Warranty cost
4.
Gauges/instruments calibration
5.
New system/process development for better quality
6.
Turn out rate for incoming quality inspection.
Maintenance:
1.
MTBF
2.
Machine down -time percentage.
3.
Average turn out time.
4.
Adherence to schedule.
5.
Defect rate attributable to poor maintenance
6.
Maintenance cost including spares inventory.
Legal:
1.
Percentage cases lost.
2.
No of litigation pending
3.
Legal payouts
4.
Process improvement/monitoring for reducing the above
31
Security:
1.
Response time
2.
Theft/pilferage control
3.
Intelligence sources developed
4.
Gate movement control
5.
Night round frequency
Secretarial:
1.
Response
time
error
rate
in
typing
word
telecommunication, information retrieval etc.

2.
New software packages learnt. .
3.
Percentage rate of independent correspondence.
4.
Executive time management
General:
1.
Cost reduction percentage.
2.
Succession schedule.
3.
Savings/process improvements/innovation.
32
processing,
filing,
FACTORS TAKEN INTO ACCOUNT WHILE APPRAISING AN

EMPLOYEE
The employees in the organization are appraised taking into account the
following factors:
1.
Performance level.
2.
Competence level.
3.
Contribution to last three years profits of the organization
4.
Qualification
5.
Age
Then a suitable rating of all the employees is done (i.e. A,B+,B,C+,C). Also,
important decisions relating to transfer, promotion and demotion are taken only
after assessing the employee's performance on a regular basis.
PERFORMANCE EXCELLENCE A WARD

It is awarded to employees who have performed extraordinarily through out the
year. "
THE WHO OF APPRAISAL

360 degree performance appraisal" is carried out in Yamaha Escorts. The
appraiser may be any person who has a thorough knowledge of the job content,
contents to be appraised, standards of contents and who observes the employee
while performing a job. Typical appraisers are:
1.
Supervisors
Supervisors include superiors of the employees, other superiors having
knowledge about the work of the employee and the departmental head or
33

manager. The immediate supervisor appraise the performance which in
turn is reviewed by the departmental head/manager.
2.
Peers
Peers appraisal may be reliable if the work group is stable reasonably for
a long period of time and performs tasks that require interaction
3.
Subordinates.
Subordinates ratings can be quite useful in identifying competent
superiors.
4.
Self appraisal
If the individuals understand the objectives they are expected to achieve
and the standards they are to be evaluated on, they are to a great extent
in the best position to appraise their own performance. Also, since
employee
development
means
self-development,
employees
who
appraise their own performance become highly motivated.

5.
Users of services
Employee performance in service organizations relating to behaviours,
promptness, speed in doing the job and accuracy can be better judged by
the customers.
6.
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. Head of the department verifies
the appraisal from time to time so as to comply with the specified
standards required for the appraisal system to be in the organization.
34

THE WHEN OF APPRAISAL
For DGM's: Increments/promotions from 1st July to 31st June.
For grades M2 to M8 : lit April to 311t March.
For supervisory staff and M2/M3 grade: lit Jan
Informal appraisals are conducted whenever the supervisor or personnel
managers feel it necessary. However, systematic appraisals are conducted on a
regular basis of one year.
Appraisal of employees on deputation
In case one is working on a deputation in a different company or a division of
Escorts, his appraisal will be carried out by the company or division and not by
the present company.
CONFIRMATION APPRAISAL
Trainees on completion of training period and employees on completion of
probation period are appraised for confirmations.
.
35
MD (M.Shibuya)
Executive Director
Mr. S.Taneja
Vice President
Mr. D.Koley
Chief G.M. HR &

Personal
Mr. M.L. Deepak
G.G.M. - Finance
DGM - Personnel
Mr. B.P. Sharma
Chief Mgr. HR
Mr. R.K. Chellani
Manager
Asst. Mgr.
Junior Mgr.
36
Staff
G.G.M. Mktg.
ANALYSIS/FINDINGS OF THE SURVEY

A survey was conducted among a sample size of 50 workers. The objective of
the survey was to highlight the performance appraisal policy of the company and
the feedback of the employees regarding it. The survey brings to light the grass
root level awareness of the workers regarding the P.A. policy. The findings of the
survey is environmented as follows:
Q1.
Are you aware of the performance appraisal system being carried

out by the company?
Analysis:
The survey brought to light that the awareness level of the

employees towards the performance appraisal system is low. 40%
of the workers are not aware about it and the rest 60% said that
there were aware of the system.
Aw are
Not Aware
40%
Not Aw are
Aware
60%
37
Q2.
According to you , which is the most important performance factor

among the following in performance appraisal?
Analysis:
40% of the workers agreed that productivity / output in the most

important factor which influence performance appraisal. 30%
believed that quality of output to be the most important factors rest
30% were divided between attendance (20%) and punctuality 10%.
Quality of
Output
30%
Attendance
20%
Productivity
output
40%
Productiv ity output

Punctuality
Attendance
Punctuality
10%
38
Quality of Output

Q3.
In your opinion, how important in attendance, punctuality,

Quantity/productivity, quality of output a factor for performance
appraisal.
Analysis:
The graph below depicts the result of the survey.
Attendance Puncutality Productiv ity

output
39
Quality of
Ouput

Q4.
Are the attitudinal factors desire to learn new techniques, skills and
practices, cooperation with others, contribution of new ideas, saving
consciousness mentioned in your format sufficient for judging your
appraisal, if not then what other factors should be included.
Analysis:
To this question 80% of the workers thought that the above

parameter were sufficient in measuring the performance appraisal
while 20% of the workers said that
the parameters were not
sufficient.
20%
Insufficient
Series1
80%
Sufficient
0%
20%
40%
60%
40
80%

Q5.
Do you think performance appraisal adopted by the company is

baised in any way?
Analysis:
Most of the workers (90%) agreed that the performance appraisal

system adopted by the company is baised and only miniscule (10%
thought otherwise).
Not Agreed
10%
Agreed
Not Agreed
Agreed
90%
41

Q6.
If you have been positively appraised, which recommendation you

personally identify with?
Analysis:
The following diagrams elucidate, which recommendation you

personally identified with?
Special
Increment
Annual
10%
Increment
30%
Annual Increment
Promotion
Special Increment
Promotion
60%
42

Q7.
Is the performance appraisal sheet shown to you or discussed with

you?
Analysis:
65% of the workers said that the performance appraisal sheet is not
shown to them, where as 35% said that it is shown and discussed
with them.
PA Sheet
Shown
35%
PA Sheet No
Shown
65%
PA Sheet Show n
PA Sheet No Show n
43
Q8.
Do you think performance appraisal should have a negative

recommendation, if yes, which one do you suggest the most.
Analysis:
50% of the workers were in favour of increment being stopped and

the rest 50% suggested that promotion could also be stopped
where as no one was in favour of demotion or separation
Should not be
stopped
50%
Increment
stopped
50%
Increment stopped
Should not be stopped
44

Q9.
In your opinion your performance should be required (a) quarterly.

(b) Bi-annually (c) Annually.
Analysis:
Nearly all the workers believed that the performance should be

reviewed quarterly.
Q10.
Are you satisfied with your performance appraisal?
Analysis:
80% of the workers said that they were not satisfied with their
performance appraisal system whereas only 20% of the workers
were satisfied with the performance appraisal system being carried
out by the company.
20%
Satisfied
Series1
Not
Satisfied
0%
80%
20%
40%
60%
45
80%
JUNIOR MANAGEMENT
A similar survey was conducted among 50 junior management cadre to get a feel
of their opinion regarding the performance appraisal policy of the company. The
observations are as follows:
Q1.
Are you aware of the performance appraisal system being carried

out by the company ?
Analysis:
Almost every manager is aware about their performance appraisal

system.
Unaware
5%
Aw are
Unaw are
Aware
95%
46
Q2.
Awareness of the system of performance appraisal being carried out by

the company?
Analysis:
70% of the management cadres were aware of the system of the

performance appraisal being carried out the by the company.
Q3.
Is the performance appraisal sheet shown to you or discussed with

you?
Analysis:
The diagram would demonstrate the results.
Shown but not

discussed
Show n & Discussed
30%
Shown &
Discussed
50%
Neither Shown
nor Discussed
20%
47
Neither Show n nor

Discussed
Show n but not
discussed

Q4.
If you have been positively appraised which recommendation you

personally identify with?
Analysis:
50% of the management cadres favoured in response to this query.

Whereas 40% & 10% favoured annual increment & special
increment respectively.
Annual
Increment
40%
Promotion
50%
Special
Promotion
Increment
Special Increment
10%
Annual Increment
48

Q5.
Do you think performance appraisal adopted by the company is

biased in any way?
Appraisal:
80% of the management cadres feel the performance appraisal

system of the company is biased whereas only 20% a think
otherwise.
Q6.
Do you think performance appraisal should have a negative

recommendation, if yes, which one do you suggest the most?
Analysis:
70%
managers
said
that
there
should
be
negative
recommendation whereas 30% managers said that there should not

be a negative recommendation. Out of 70% who supported
negative recommendation were 20%. Who believed increment
should be stopped and 10% who believed promotion should be
stopped.
No Negative
Recommenda
tion
30%
Negativ e
Recommendation
Negative
Recommenda
tion
70%
49
No Negativ e
Recommendation
10%
Increment Stopped
Promotion Stopped
20%
Q7.
Are you satisfied with the present performance appraisal system?
Analysis:
The following diagram would demonstrate the results.
60%
Satisfied
Series1
Not
Satisfied
0%
40%
20%
40%
50
60%

Q8.
Do you think the present performance appraisal system is effective?

If not then what changes would you suggest.
Analysis:
Most of the employees were of the opinion, that the present

performance appraisal was effective but wanted some changes to
be made. The changes are as follows:
1.
The performance appraisal system should be more performance

oriented.
2.
Quarterly assessments of individual should be done rather than

yearly.
3.
It should be more transparent in its operation.
4.
Efforts should be made to reduce chances of biasness while

appraising an employee.
51

Q9.
Do you know the Yardsticks according to which you are appraised?
Analysis:
The following diagram depicts the result.
60%
Aware
Series1
40%
Unaware
0%
20%
40%
52
60%
Q10.
Do you think the weightage given to various factors baised?
Analysis:
70% of the management cadre agrees that the weightage given to

various performance factors are baised whereas 30% believe that
they are not baised.
Q11.
In your opinion your performance should be reviewed?
Analysis:
To this query, 80% of the managers strongly felt that their

performance should be reviewed quarterly and the rest 20% of
them annual and bi-annual system of performance appraisal.
Q12.
Once
you
have
been
positively
appraised,
does
the
that
the
recommendation come to you immediately?

Analysis:
90%
of
the
sample
size
were
of
the
opinion
recommendation of the performance appraisal follow immediately

were as only 105 were of the view that recommendations are slow
to follow.
53
Questionnaire For Workmen.

Q.1
ARE YOU AWARE OF THE PERFORMANCE APPRAISAL

SYSTEM BEING CARRIED OUT BY THE COMPANY ?
( a ) YES
Q.2
( b ) NO
WHICH SYSTEM OF PERFORMANCE APPRAISAL IS

CARRIED OUT BY THE COMPANY ?
( a ) BARS
( c ) RANKING METHOD
Q.3
( b ) WEIGHTED AVERAGE
( d ) 360 DEGREE
ACCORDING TO YOU , WHICH IS THE MOST IMPORTANT

PERFORMANCE FACTOR AMONG THE FOLLOWING IN
PERFORMANCE APPRAISAL ?
( a ) ATTENDANCE
( b ) PUNCTUALITY
( c ) PRODUCTIVITY / OUTPUT
Q.4.
(d ) QUALITY OF OUTPUT
IN YOUR OPINION, HOW IMPORTANT IS ATTENDANCE A FACTOR FOR

PERFORMANCE APPRAISAL ?
( a )VERY IMPORTANT
( b ) IMPORTANT
(c) SOMEWHAT IMPORTANT
(d) LOOSELY IMPORTANT
(e)UNIMPORTANT
Q.5.
IN YOUR OPINION, HOW IMPORTANT IS PUNCTUALITY A FACTOR

FOR PERFORMANCE APPRAISAL ?
( a )VERY IMPORTANT ( b ) IMPORTANT

54
( c ) SOMEWHAT IMPORTANT

( d ) LOOSELY IMPORTANT
Q.6
(e)UNIMPORTANT
.IN YOUR OPINION, HOW IMPORTANT IS QUANTITY/PRODUCTIVITY

OF OUTPUT A FACTOR FOR PERFORMANCE APPRAISAL ?
( d ) LOOSELY IMPORTANT (e)UNIMPORTANT

Q.7.
IN YOUR OPINION, HOW IMPORTANT IS QUALITY OF OUTPUT A

FACTOR FOR PERFORMANCE APPRAISAL ?
( d ) LOOSELY IMPORTANT (e)UNIMPORTANT

Q.8.
ARE THE ATTITUDUNAL FACTORS, DESIRE TO LEARN NEW

TECHNIQUES, SKILLS AND PRACTICES , CO- COPERATION WITH
OTHERS , CONTRIBUTION OF NEW IDEAS, SAVING CONSCIOUSNESS
MENTIONED IN YOUR FORMAT SUFFICIENT FOR JUDGING YOUR
APPRAISAL, IF NOT , THEN WHAT OTHER FACTORS SHOULD BE
INCLUDED
SUFFICENT--------------IN SUFFICENT
Q.9.
DO YOU THINK PERFORMANCE APPRAISAL ADOPTED BY THE

COMPANY IS BAISED IN ANY WAY ?
(a) YES
(b) NO
Q.10. IF YOU HAVE BEEN POSITIVELY APPRAISED, WHICH

RECOMMENDATION YOU PERSONALLY IDENTIFY WITH ?
(a) PROMOTION
(b) SPECIAL INCREMEMNT

55

(c) ANNUAL INCREMENT
Q.11. IS THE PERFORMANCE APPRAISAL SHEET SHOWN TO YOU OR
DISCUSS WITH YOU ?
(a) YES
(b) NO
Q.12. DO YOU THINK PERFORMANCE APPRAISAL SHOULD HAVE A

NEGATIVE RECOMMENDATION, IF YES, WHICH ONE DO YOU
SUGGEST THE MOST ?
(a) INCREMENT STOPPED
(b) PROMOTION STOPPED
(c) DEMOTION
(d) SEPRATION
Q.13. IN YOUR OPINION YOUR PERFORMANCE SHOULD BE REVIEWED .

(a) QUARTERLY
(b) BI-ANNUALLY
(c) ANNUALLY
Q.14. ONCE YOU HAVE BEEN POSITIVELY APPRAISED, DOES THE

RECOMMENDATION COME TO YOU IMMEDIATELY?
(a) YES
(b) NO
Q.15. ARE YOU SATISFIED WITH YOUR PERFORMANCE APPRAISAL ?

(a) YES
(b)NO
Q.16. IF NO , THEN WHAT CHANGES WOULD YOU SUGGEST ?
56
Questionnaire for Junior Management

Cadre.
Q1
Are You Aware Of The Performance Appraisal

System Being Carried Out By The Company ?
( A ) Yes
Q.2
( B ) No
Which System Of Performance Appraisal Is

Carried Out By The Company ?
Q.3.
( A ) Bars
( B ) Weighted Average
( C ) Ranking Method
( D ) 360 Degree
Is The Performance Appraisal Sheet Shown To You Or

Discuss With You ?
(A) Yes
Q4.
(B) No
If You Have Been Positively Appraised, Which

Recommendation You Personally Identify With ?
(A) Promotion
B) Special Incrememnt
(C) Annual Increment

Q.5.
Do You Think Performance Appraisal Adopted By The

Company Is Baised In Any Way ?
(A) Yes
(B) No
57
Q6.
Do You Think Performance Appraisal Should Have A

Negative Recommendation , If Yes , Which One Do You Suggest The Most ?
(A) Increment Stopped
(B) Promotion Stopped
(C) Demotion
(D) Sepration
Q.7. Are You Satisfied With The Present Performance

Appraisal System ?
(A) Yes
Q8.
(B) No
Do You Think The Present Performance Appraisal System Is Effective ? If Not

Then What Changes Would You Suggest
Note :
Q.9.
Is Your Performance Apprasal System Linked With

M.B.O. Sheet, If Yes Then Whether It Should Be Linked Or You Suggest Any
Changes ?
Note:
Q10.
Do You Know The Yardsticks According To Which You

Are Appraised ?
(A) Yes
(B) No
Q11. Do You Think The Weightage Given To Various Factors

Baised ?
58

(A) Yes
(B) No
Q.12. In Your Opinion Your Performance Should Be Reviewed .

(A) Quarterly
(B) Bi-Annually
(C) Annually
Q.13. Once You Have Been Positively Appraised, Does The Recommendation Come To
You Immediately?
(A) Yes
(B) No
59
BIBLIOGRAPHY
C.B Mamoria: "Personnel Management"

P. Subba Rao: "Essentials of Human Resource Management and
Industrial Relations"
Edwin B. Flippo: "Personnel Management"
Handbook for Managers: "Escorts motors India Ltd."
EYMIL Reporter, magazines.
60

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Performance Appraisal System at YAMAHA

Surajpur plant was established in 1985.

Faridabad plant was established in 1965.

The turnover of Surajpur plant is around 702 crores as compared to 208

The volume of Motorcycles procured in numbers is 211913 in Surajpur

Manpower in Surajpur plant is 1048 and compared to 1946 in Faridabad

Performance Appraisal System at YAMAHA

The average age of employee in Surajpur is 35 years where as 45 years

Total land area in Surajpur is 351385 sq.mtrs. in Faridabad it is 1,21,674

OBJECTIVES OF THE COMPANY

Chief profitable conditions in mid term plan.

No further investment in mid term.

Continuous improvement in daily production (quality distribution and cost).

Motivated and charged up employees.

Performance Appraisal System at YAMAHA

Performance Appraisal System at YAMAHA

Performance Appraisal System at YAMAHA

Performance Appraisal System at YAMAHA

Statement showing Emoluments:

Night Shift Allowance(/day)

Washing Allowance (/month)

2. indirect Link With

per factory act)

Performance Appraisal System at YAMAHA

OBJECTIVE OF THE STUDY

Performance Appraisal System at YAMAHA

To critically analyze the performance appraisal system in Yamaha Motors

To gain familiarity with the organizational environment and the work

To study the personnel environment

The purpose of the study is to evaluate the impact of performance

It is to see how the present performance appraisal system has contributed

Performance Appraisal System at YAMAHA

was prepared and distributed both to the

Performance Appraisal System at YAMAHA

INTRODUCTION TO PERFORMANCE APPRAISAL

HISTORY OF PERFORMANCE APPRAISAL SYSTEM

emphasis on the development of the individual as and widely used to evaluate,

Performance Appraisal System at YAMAHA

Performance Appraisal is a systematic description of an employee's job

Appraisals are arranged periodically according to a definite plan.

It is a continuous process in every large scale organization.

Performance Appraisal System at YAMAHA

NEED OF PERFORMANCE APPRAISAL

Provide information about the performance ranks basing on which

Provide feedback information about the level of achievement and

Provide information which helps to counsel the subordinates.

Provide information to diagnose deficiency in employees regarding skill,

To prevent grievances and indisciplinary activities.

Performance Appraisal System at YAMAHA

To create and maintain a satisfactory level of performance.

To contribute to the employees growth and development through training,

To help the superiors to have a proper understanding about their

To guide the job changes with the help of continuous ranking.

To facilitate fair and equitable compensation based on performance.

To facilitate for testing and validating selection tests, interview techniques

To provide information for making decisions regarding layoff, retrenchment

To ensure organizational effectiveness through correcting employee for

Performance Appraisal System at YAMAHA

CONTENT OF PERFORMANCE APPRAISAL

Self expression -written and oral

Ability to work with others

Leadership styles and abilities

Ability to grasp new things

Originality and resourcefulness