Performance Appraisal

1.1 INTRODUCTION

Human resource management (HRM) is the strategic and coherent approach to the
management of an organization’s most valued assets – the people who work there
individually and collectively contribute to the achievement of the objectives of the
business. The terms “human resource management” and “human resources” (HR)
have largely replaced the term “personnel management” as a description of the
processes involved in managing people in organizations. Human Resource
management is evolving rapidly. Human resource management is both an academic
theory and a business practice that addresses the theoretical and practical techniques
of managing a work force.

The goal of human resource management is to help an organization to meet

strategic goals by attracting, and maintaining employees and also to manage them
effectively. Human resources management comprises several processes. Together
they are supposed to achieve the above mentioned goals. These processes can be
performed in an HR department, but some tasks can also be outsourced or performed
by line-managers or other departments. They are:
 Workforce planning
 Recruitment (sometimes separated into attraction and selection)
 Induction and Orientation
 Training and Development
 Performance appraisal

1. Strategic Workforce Planning

It involves analyzing and forecasting the talent that companies need to execute
their business strategy, proactively rather than reactively, it is a critical strategic
activity, enabling the organization to identify, develop and sustain the workforce
skills it needs to successfully accomplish its strategic intent whilst balancing career
and lifestyle goals of its employees. Strategic Workforce Planning is a relatively new
management process that is being used increasingly to help control labor costs, assess
talent needs, make informed business decisions, and assess talent market risks as part
of overall enterprise risk management. Strategic workforce planning is aimed at

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helping companies make sure they have the right people in the right place at the right
time and at the right price.

Through Strategic Workforce Planning organizations gain insight into what people the
organization will need, and what people will be available to meet those needs. In
creating this understanding of the gaps between an organizations’ demand and the
available workforce supply, organizations, will be able to create and target programs,
approaches and develop strategies to close the gaps.
2. Recruitment:
It refers to the process of sourcing, screening, and selecting people for a job or
vacancy within an organization. Though individuals can undertake individual
components of the recruitment process, mid – and large-size organizations generally
retain professional recruiters.
3. Induction:
The process used within many businesses to welcome new employees to the
company and prepare them for their new role.
4. Orientation:
“Orientation is a systematic and planned introduction of employees to their jobs,
their co-workers and the organization.
5. Training and development (T & D):
It deals with the design and delivery of learning to improve performance, skills, or
knowledge within organizations.
6. Performance appraisal:
It is also known as employee appraisal, is a method by which the performance of
the employee is evaluated.

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1.2 INDUSTRY PROFILE

A battery is an electrochemical device in which the free energy of chemical reactions

converted into electrical energy. The chemical energy contained in the active
materials is converted into electrical by means of electrochemical oxidation-reduction
reaction

HOW A BATTERY WORKS?

When you place the key in your car’s ignition and turn the ignition switch to “ON”, a
signal is sent to the car’s battery. Upon receiving this signal the car battery takes
energy that it has been strong in chemical form and releases it as electricity. This
electric power is used to crank the engine. The battery is also used to power the car’s
light and other accessories. It is the only device, which can store electrical energy in
the form of chemical energy, and hence it is called as a storage battery.

SEALED MAINTENANCE FREE (SMF) BATTERIES:

Sealed Maintenance Free (SMF) batteries technologies are leading the
battery industry in the recent year in automobile and industrial sector around the
globe. SMF batteries come under the rechargeable battery category so it can be used a
number of times in the life of a battery. SMF batteries are more economical than
nickel cadmium batteries. These batteries are more compact than the west type
batteries. It can be used at any position, these batteries are very popular for portable
power requirement and space constraint applications.

VALUE REGULATED LEAD ACID (VRLA) BATTERIES:

VRLA batteries are leak proof, spill-proof and explosion restraint and have
life duration of 15 to 20 years. These batteries withstand the environment conditions
due to high technology in-built in the batteries. Each cell is housed in a power coated
steel tray making them convenient to transport and installation, so transit damages are
minimized incase of these batteries. Sealed Maintenance Free (SMF) batteries and
VRLA batteries technology are leading the battery industry in the recent years in
Automobile and Industrial battery sector around the globe.VRLA batteries had

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become the preferred choice in various applications such as uninterrupted power

supply (UPS) and security systems and weighting scales.

CLASSIFICATION OF BATTERIES:

Batteries are broadly classified into two segments like,

 Automotive Batteries
 Industrial Batteries
AUTOMOTIVE BATTERIES :

All the automobiles including scooter needs a storage battery. So automotive

batteries play a pre-dominant role in automobile sector by influencing customers in
the market. Automobile batteries can be further distinguished as the original
equipment (OE) markets as low as 5-6%. OE segment has the advantage of securing
continuous orders and inquiries. This enables manufacturers to streamline production
facilities, plan production schedules and attain certain level of operational efficiency.
The replacement market, on the other hand, is much larger. The replacement market is
characterized by the presence of large unorganized sector, which constitutes around
55-60 % of the total replacement market. This is possible due to low capital entry
barrier. These players have the advantage of inapplicability of excise duties.

INDUSTRIAL BATTERIES:
The industrial battery segment comprises of two main categories. One
comprises of the “stationary segment” and the second relating to “Motive Power and
Electric Vehicles”. The Motive Power and Electric Vehicles Segment comprising of
“Telecom, Railways and Power Industries have registered a growth in excess of 20%
and this trend is likely to continue in the next 5 years”. The Industrial segment is
highly technological intensive and access to high quality work class technology is an
important factor and is vital for brand reference. The total demand for the industrial
battery segment is met by indigenous production with a small saves of about 10% by
imports. The demand for industrial batteries has grown slowly and steadily. As far as
industrial batteries are concerned the evolving consciousness among Corporate and
Government departments regarding environment factors will result in a shift towards
pollution free technology. There has been a preferential shift in this segment from the

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Conventional Lead batteries to sealed maintenance free batteries (SMF). The bull of
battery industry admits that the sales are fallen but at the same time they are expecting
larger orders especially from telecom industry which gets going.

RECYCLING BATTERIES:

Battery acid is recycled by neutralizing it into water of converting it to sodium

sulphate for laundry detergent, glass and textile manufacturing. Cleaning the battery
cases, meeting the plastic and reforming it into uniform pellets recycle plastic. Lead
which makes up 50% of every battery, is method pored into slabs and purified .
MAJOR MANUFACTURERS OF BATTERIES IN INDIA:

The following are the major manufacturers in battery industry in India:

 Excide Industries
 Standard Batteries
 Hyderabad Batteries
 GNB
 Prestolite and
 AMCO
RAILWAYS: In Railways the demand estimate is based on the annual coach
production this comes to 2500 numbers by Railways itself and 1000 numbers more by
various other segments, replacement demand and annual requirement for Railways
electrification. In this sector the estimated 90 private power projects which are
expected to produce 40,000MV with an approximate capital outlay of Rs.1,40, 000
crores would keep the industries future brighter in the coming years .The demand of
VRLA batteries is increasing due to its performance over conventional batteries. So it
is more acceptable to consumers. There appears to be a considerable potential for
electrically operated material handling equipment and related vehicle besides the
privatization of technology. It is expected to generate Wider market for sophisticated
batteries. The Railways will continue to generate demand for various applications.
The power sector is also opening up a setting up of generating stations will give a
boost to demand levels. The demand will continue to grow with the growing
automation in industries.

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STORAGE BATTERIES:
In the storage battery industry, some new units have come up. The latest development in
this field is maintenance free rechargeable storage batteries. These are also known as
Valve Regulated Lead Acid (VRLA) or Sealed Maintenance Free (SMF) batteries.
Improvement of technology in this industry is benefiting customers

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1.3 COMPANY PROFILE

Amara Raja Batteries Ltd was established by Mr. Rama Chandra Naidu and the
Chairman of Amara Raja Batteries LTD; He is a post graduate engineer with over
16 years experience in power systems as an electrical engineer in Nuclear and
conventional source power generating stations across the USA. Mr. Galla went to
USA after obtaining degrees from S.V. University, Tirupati & Roorkee University.
He holds an M.S. Degree in system science from Michigan state university.
Ramachandra Galla worked in various capacities such as Sr. Electrical Engineer,
Electrical Project Engineer, and Sr. Electrical Project Engineer for Sergeant &
Lundy, Chicago, USA. He was involved in various Nuclear power plant projects
Amara Raja is having a technological Joint Venture with Johnson Controls INC
(JCI), USA in the year 1991 who owns 26% *stake in the company. JCI is a Leading
battery manufacture in USA. Johnson Controls is a Fortune 500 company and also
the largest manufacturer of lead acid batteries in North America and a leading global
supplier to major automobile manufacturers and industrial customers. Amara Raja
has its Registered Office and Head Office at Karakambadi near Tirupati in A.P.
Karakambadi is located at an approximate distance of 12 kms from Tirupati. The
manufacturing campus at Karakambadi is one of the most beautifully landsc aped
campuses and boasts of state of the art manufacturing facilities.

Amara Raja has demonstrated its commitment to offer optimum system

solution of the highest quality and has become the largest supplier of standby power
systems to core India utilities such as the Indian Railways, Department of
Telecommunications, Electricity Boards and major power generation’s companies.
Extensible plans have been charted out for the future, where in the company
undertakes to become the most preferred supplier for power back-up systems. Amara
Raja has offered time tested world-class technology and processes developed on
international standards be it high integrity VRLA systems like power stack and power
plus or the recently launched high performance UPS battery – KOMBA T & AMARON
HI-LIFE automotive batteries that are the products of the collaborative batteries
efforts of engineers Johnson controls Inc. ARBL comprises of two major divisions viz.,

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 Industrial Battery Division (IBD)

 Automotive Battery Division (ABD)

INDUSTRIAL BATTERY DIVISION (IBD):

Amara Raja has become the benchmark in the manufacture of Industrial
batteries. India as one of the largest and fastest growing markets for Industrial
batteries in the world and Amara Raja is leading in the front with an 80% market
share for standby VRLA batteries. It is also having the facility for producing plastic
components required for Industrial batteries. ARBL is the first company in India to
manufacture VRLA batteries (SMF). The company has set-up Rs.1920 Lakhs plant in
18 acres in Karakambadi village, Renigunta Mandal. The project site is notified under
‘B’ category.
The capacity of IBD is 75 million ah.
CUSTOMER BASE:
Telecom:

 Our Batteries power almost half of BSNL / MTNL exchanges.

 70% of the Private Basic Service providers' exchanges (Siemens)
 More than 70% of the Cellular service providers' exchange (Nokia,
Ericson)
 Telecom Customers Include:

 All ITI (Indian Technology Institutions) plants for In-house and switch
requirements.
 BSNL / MTNL
 All NT Switch OEMs viz., Lucent, Alcatel, Siemens, Nokia, Ericsson etc.,
 All C-DOT switch OEMs viz. BEL, BHEL, CGL, UTL, etc.
 All private Basic and Cellular service providers And all Network Integrators
Power Control;We provide Back-Up critical installations in Power generating
Units and provide back-up power for transmission and distribution sub-stations like:

Raichur Thermal Power station.

North Chennai Thermal Power station.

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 ARBL is an approved vendor for NTPC (National Thermal Power

Corporation Ltd) /NHPC (National Hydro Power Corporation) and Power
Grid Corporation.
OIL&GAS: ARBL provides integrated solutions for renewable energy back-up
power for ONGC's offshore platforms. The island of Lakshadweep is powered
through Amara Raja Power Systems. Also provide back-up power for low power
transmitters for doordarshan.

MOTIVE POWER: ARBL is the country's first manufacturer of maintenance-

free traction batteries used in Forklifts and Pallet trucks.

OUR CUSTOMER: APC (American Power Control), Siemens (All type of

power Supply Products) Eg: Switch Boards, Alstom (Power Projects) E.g.: Metro
Line Delhi, Compton Greaves etc (Power Products).

DEFENSE: ARBL introduced new technologies for back-up power in Defense,

Police and Paramilitary communication systems.

UPS: ARBL is the preferred suppliers for all leading UPS back-up manufacturers
like APC, Numeric (India), DB Power, APLab, and Electronics & Controls etc. Our
UPS batteries are the fastest growing battery brand since its launch in July 2002
with a nation-wide footprint of Sales and Service points and over 300, 000 batteries in
use at over 10,000 customer sites.

RAILWAYS: ARBL pioneered the use of maintenance-free batteries in the Indian

Railways. Over 50 % of Indian Railways' II and III Tier self-generation Air-
conditioned coaches are powered by ARBL. Over 40% of Railway's Signaling and
Telecom power supply solutions are provided by ARBL.

COMPETETIORS

The major competitors for Amara Raja Batteries products are Exide Industries Ltd.,
Hyderabad Batteries LTD, and GNB.

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AUTOMOTIVE BATTERY DIVISION (ABD)

ARBL has inaugurated its automotive plant at Karakambadi in Tirupati on September

24th 2001 this plant is part of the most completely integrated battery manufacturing
facility in India with all critical components, including plastics sourced in house from
existing facilities in site. In this project Amara Raja strategic alliance partners
Johnson controls, USA have closely worked with their Indian components required
for automotive batteries.
CAPACITY:
With an existing production capacity of 5 lakh units of automotive batteries the new
Greenfield plant will now be able to produce 3.5 million Batteries per annum. This is
the first phase in the enhancement of Amara Raja production which the company has
invested Rs.75 crores. In the next phase at an additional cost of Rs.25 Crores.
Production capacity will increase to 5 million units estimated to complete around 1
year. After that ARBL will become the single largest facility for battery manufacture
in Asia.
Products: Some of the products of ABD are
1. Amaron Highlife
2. Amaron Harvest
3. Amaron Shield
4. Amaron Hi-way
CUSTOMERS:
ARBL has prestigious OEM (Original Equipment manufacture) clients like FORD
general motors, Daewoo motors, Mercedes Benz Daimler CHRYSLER, Maruti
Udyog ltd premier Auto Ltd., and recently acquired a preferential supplier alliance
with Ashok Leyland, Hindustan motors, Telco, Mahindra & Mahindra and Swaraz
Mazda, Hyundai.
COMPETITORS:
 Exide

 Prestolite

 AMCO

 Hyderabad Batteries Ltd;

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MILE STONES OF AMARA RAJA BATTERIES LTD:

1985 DEC - Foundation stone laid for Amara Raja.
1992 MAY - Designed & implemented the most advanced battery manufacturing
facility in India
1997 FEB - Received the ISO 9001 certification
1997 DEC - Commissioned own plastics & tool room sections
1997 DEC - Joint venture with Johnson Controls
1998 MAY - Received QS 9000 certification

2000 JAN - Launched Amaron automotive batteries

2001 APRIL - launched the new corporate logo

2001 SEP - Awarded the ISO 14001 certification New Corporate Logo launched

2002 MAY - Commissioned phase 1of new automotive battery plant, with capacity of
2million

2002 JULY - Launched Quanta UPS batteries

2002 AUG - Launched Amaron Hiway and Harvest batteries

2004 MAR - Received Ford World Excellence Award

2004 SEPT - Launched Amaron PRO, GO and FRESH automotive batteries

2004 OCT - OE agreement with Maruti Udyog Ltd.

2005 JUN - OE agreement with Hyundai motors

2005 AUG - NK series Limited edition batteries Launch

ARBL’S FUTURE PLANS

 Maximizing the exports

 Emerge as global player
 Constant up gradation of products.
 Stream of new models.
 Constant stress on improving productivity.

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AWARDS FOR AMARA RAJA BATTERIES LTD

 Automotive Product of the year 2000 by Overdrive

 Excellence in Environmental Management in 2002 by AP Pollution Control Board
 Creative Advertiser of the year '02 by ABBY
 Ford "World Excellence Award"
 Ford Q1 Award
 ISO-9001 in 1997…RWTUV
 QS 9000 in 1999…RWTUV
 ISO/TS 16949 in 2004…RWTUV
 Quality benchmarks
 Best Business Practices as per JCI
 ISO 14001 in 2002…RWTUV
 Part of the world's largest battery manufacturing alliance - Johnson Controls Inc.,
USA
 Largest manufacturer of standby VRLA batteries in South Asia
 Pioneered the widely used VRLA batteries for industrial application in India
AMARA RAJA BATTERIES LTD’S STRENGTHS:

 Proven technology from GNB and Johnson Control Inc being a pioneer
 Strong and well organized customer base.
 Full-organized infrastructure in place.
 Manufacturing facilities perceived as a benchmark in India.
 Complete range of VRLA batteries.
 Proven field performance in all user segments.
 Approved vendor status in major user segment.
Amara Raja is a 5 ‘S’ company and its aim is to improve the work place
environment by using 5’S’ technique which is a systematic and rational approach to
workplace organization and methodical housekeeping with a sense of purpose
consisting of the following five elements:

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1.SEIRI - Sort out

- Segregate necessary from necessary
- Discard what is not required
- Decide on frequency of sorting.
2.SEITON - Systematic arrangement
- Arranging in order
- A place for everything and everything in its place
3.SEISO - Spic and span
- Cleaning the work place Equipment
- Ensuring Tip Top Condition.
4.SEIKETS - Standardization
- Working methodology (procedures and work instructions)
5.SHITS - Self Discipline
- Forming the habit
- Training
- Be Disciplined.
They Propose To Accomplish This By:
 Training the people and creating awareness on 5 ‘S’

 Motivating and changing the behavior patterns of the people

 Establishing standard procedures for the implementation of each element of 5 ‘S’.

They Believe That Effective Implementation Of 5’S’ Technique Will

Result In:
 Higher productivity

 Lesser Accidents

 Higher Employee Morale

COLLABORATORS:

Amara Raja is a strategic tie up with “Johnson controls Inc” of U.S.A who owns 26%
stack in this company. It is the largest manufacturer of lead acid batteries in North
America The main objective of the company is manufacturing of good quality of

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“Sealed Maintenance Free acid batteries (SMF)”. The annual growth rate of a
company is 2.5% per annum. The present turnover of the company is Rs. 270 crores.
Major customers are BSNL, VSNL, SIEMENS and BHEL etc. Amara Raja has
always offered time tested world class technology and process developed on
international standards. High integrity VRLA systems like power stack and power
plus are the recently launched high performance UPS battery, KOMBAT and
AMARON hi-life batteries are the products of the collaborative battery efforts of
engineering at Johnson controls Inc and Amara Raja.
BRAND:
Amara Raja reflects the innate dynamism of the company. The emblem demonstrates
the interplay of the universal Yin Yang symbols and the philosophy of balanced
forces. The colours green and black emphasise the perfect symmentry of absorbing
and releasing energies, while the entire form in continuous motion signifies
unrelenting progress. The color green specifies the role of technology as an integral of
the company’s growth. Not incidentally, it also connotes the company’s resolve to
preserve and nurture the environment.
AMARA RAJA GROUP OF COMPANIES:
 AMARA RAJA POWER SYSTEMS PRIVATE Ltd., (ARPSL), Tirupathi.

 MANGAL PRECISION PRODUCTS PRIVATE Ltd1.,(MPPL1), Tirupathi.

 MANGAL PRECISION PRODUCTS PRIVATE Ltd2.,(MPPL2), Chittoor.

 AMARA RAJA ELECTRONICS PRIVATE LIMITED (AREPL), Chittoor .

 GALLA FOODS PRIVATE LIMITED (GFPL), Chittoor.

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1.4 PRODUCT PROFILE

Table 1.1

S.No PRODUCT NAME FEATURES APPLICATIONS

High Performance, totally high Power

1 Amaron Harvest For Tractors
charge acceptance

Ready to fit, Long life, Low

2 Amaron Shield For Inverters
Maintenance higher cracking power

For Cars, Utility vehicles

Long life, maintenance free, Fully
3 Amaron Hi-Life Tractors, 3 Wheelers, HCV's,
scaled and tested, no leakage
geneses & LCV's

4 Quanta UPS Batteries

-

Industrial applications, Power

Plants, Railways,
Lightweight, Sturdy Weather Proof &
Amara Raja Industrial (Power Telecommunications, Defense,
5 Long Lasting, High intensity, High
stack) Motive power, Solar
energy density
Photovoltaic. Electric Vehicles,
Emergency Lighting.

Zero maintenance, no specific Gravity

checks, no Water tapping up required,
Long life, ideal size Factory charged,
6 Amara Raja Genpro For Generators
therefore ready To use, assured starting
ready To use, assured starting and
Service,

 Zero maintenance, No life time,

No leaks, High energy density, Factory vehicle like Fork Lifts,

7 Brute (The motive Powerhouse) Pallet trucks, Stokers and
No sulphation of plates, Vaive Platform Trucks.

Regulated, and Safe.

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High discharge, High

performance batteries which are

UPS,EPBX, Engine
8 Kombat compact light weight factory starting,Emergency lighting, Fire
alarm security systems
charge, Explosion resistant and

Environment friendly

Long life, Ultra low maintenance

9 Amaron Hi-way batteries Ready to fit, Higher cranking For Trucks

Power

RESEARCH & DEVELOPMENT:

 Specific areas in which the company carries out R&D includes

 New product development
 Process technology up-gradation
 Application engineering for new market place
 Quality improvement.
Benefits derived as a result of above R&D:

 Developed 4v/200 AH batteries

 Design optimization of higher AH batteries for DOT application
 New range of battery 9v/1285 AH batteries for TC/AC Railway application
 Design optimization of batteries for UPS applications
 Formation cycle optimization results in reduced duration and rejection
 Manufacture of automobile battery for four wheeler vehicles.
FUTURE PLAN OF ACTION:

 Commercialization of motor cycle batteries

 Development of new range high integrity VRLA cell design
 Establishment of product for new application segment
 Studies on paste additives to enhance the battery performance.
 In depth evolution of metal surface treatment chemicals to reduce the process
cycle time.

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 Validating alternative grades of propylene to conserve energy and to improve

productivity
MAJOR USES:

1. Railways:
Train lighting air conditioning, diesel engine starting, signaling systems, control
systems, emergency breaking systems and telecommunications.

2. Telecommunication:
Central office power plants, microwave repeaters station, RAX in public building,
emergency lighting system at airports, fire alarm system etc.,
3. PowerSystems:
Switch gear control systems, power house control systems, rural street lighting
etc.,
4. UpsSystem:
Back up power to computers in progress control systems in industry etc.,
5. Petrochemicals:
Off shore and no shore oil exploration lighting systems, security systems etc.,

6. Defence:*
Defence communication, aircraft and helicopter ground starting, stationary and

Mobile diesel engine starting etc.

PRODUCTION PROCESS

The process for the production of lead acid batteries consists essentially of
five operations described below.

1. Grid Casting: In this process grids to hold the active materials are made.
Battery grids are produced sing microprocessor casting machines with patented
alloys. Different sizes of moulds are used to get the required size of grids.

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2. Plate preparation: Using lead oxide production in earlier stage positive and
negative paste is prepared with addition of sulphuric acid and water. These pastes are
applied to respective grids using industrial pasting machines.

3. Cell Assembly: Here positive and negative grids are separated by a sheet of
fiber glass bars are welded and as assembled into a jar or container to form battery
cells. Then these cells are assembled according to the customers specification into
battery sets or systems.

4. Formation: In this process cells are filled with electrolyte(sulphuric acid) and
then the set is charged and discharged repeatedly, after final charging the battery
comes out ready to be used.

5. Testing & Inspection: Testing the battery is discharged to the customer, it is

tested for quality specifications.

PROCESS FLOW CHART (BATTERIES)

Input Converting Pasting mixing

pure Lead by adding
Pure Sulphuric acid
into Lead with water
Lead Oxide
Grid casting Pasting Grid
with Lead
Oxide paste
Winding the
pasted Grid
with
separator
Group
insertion Jar
Sealing
the Jar

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2.1 NEED FOR THE STUDY

Performance appraisal is helpful in providing feed back information about the

achievement and behavior of subordinates. It helps in rectifying the performance

deficiencies and to sent new standards of work.

This made to study how the performance appraisal system need to know the
employees satisfaction towards appraisal system in AMARA RAJA at TIRUPATI

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2.2 SCOPE OF THE STUDY

To study the performance appraisal system at AMARARAJA in Tirupathi.

Performance appraisal is a method of evaluating the behavior of employee in the work

spot, normally including both the quantitative and qualitative aspects as job

performance.

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2.3 OBJECTIVES OF THE STUDY

 To study and analysis different performance appraisal techniques adopted by

the AMARARAJA in THIRUPATHI.

 To asses the effectiveness of performance appraisal system.

 To study the impact of counseling for employees.

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2.4 RESEARCH METHODOLOGY

In any study of research proper reason of analysis is essential for reaching the
goal or an effective solution to the problem. This reasoning can be done in a research
study with help of research methodology. Reasearch methodology is a way to
systematically solve the research problem it may be understood as a since of studying
how research is done scientifically.

2.4 RESARCH DESIGN

After the objective of the study has been clearly stated, the next step in formal
research project is to determine the source from which the data is required to be
collected.
The data collection is an interesting aspect of the study. For the purpose of
achieving data effectively the information consist of two types of data. The diagram is
as follows:
DATA COLLECTION

PRIMARY DATA SECONDARY DATA

1. Personal interview with various 1. Information from various publication,
Officials and employees of the journals and magazines.
Organization.

2. About 120 employees were interviewed 2.Personal reports of LPG Bottling Plant,
through a questionnaire HPCL

a) Primary Data:
The primary data are those, which are collected freshly and for the first time, from
the employees directly. It is collected through the following methods.
1. Questionnaire: A structure of questionnaire was prepared and distributed
among the employees
2. Interview: Personal interviews and interaction with the employees and labor.

3. Observation: By observing the working environment.

b) Secondary Data:

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The secondary data are those which have already been collected by someone
or else which have been passed through statistical process. Sources of secondary data
can be categorized into 2 broad categories named published and unpublished
statistics. Various sources are available namely books, magazines etc. and also
collected from various files, records and Journals.

2.5 LIMITATIONS FOR THE STUDY

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1. The performance appraisal study is limited only to the Amara Raja which is

located in Tirupati.

2. The performance appraisal study is conducted on a limited no. of employees and

on the entire work force.

3. Sample size is 120 respondents.

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CHAPTER-3

THEORETICAL BACHGROUND

PERFORMANCE APPRAISAL:
Appraising the performance of individuals, groups and organizations is a
common practice of all societies. While in some instances these appraisal processes
are structured and formally sanctioned, in other instances they are an informal and
integral part of daily activities. Thus, teachers evaluate the performance of students,
bankers evaluate the performance of creditors, parents evaluate the behavior of their
children, and all of us, consciously of unconsciously evaluate our own actions from
time to time. In social interactions, performance is conducted a systematic and
planned manner to achieve widespread popularity in recent years.
Definition:
“Performance appraisal is the process of determining and communicating to an
employee how he or she is performing on the lob and, ideally, establishing a plan of
improvement:.
Aswathappa K. Human Recourses and Personal management, Tata McGraw-Hill
Publishing Company limited, New Delhi
Meaning:
Performance Appraisal is a method of evaluating the behavior of employees in the
work spot, normally including both the quantitative and qualitative aspect of the job
performance. Performance here refers to the degree of accomplishment of the tasks
that make up an individual job. It indicates how well an individual sis full filling the
job demands often the terms is confuse with effort, but performance is always
measured in terms of results and not efforts. Under performance appraisal we evaluate
not only the performance of an employee but also his potential for development.
Concept:
During and after world war, systematize performance appraisal was quite
prominent and credit goes to Water Dill Scott for systematic performance appraisal
technique of “man-to-man rating system” it was used for evaluating military officer
management stated adopting this performance appraisal for evaluating technical,

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skilled, professional and managerial personnel as a part of training and executive

development programs technical.
PROCESS OF PERFORMANCE APPRAISAL:

ESTABLISHING PERFORMANCE STANDARDS:

The first step in the process of performance appraisal is the setting up of the
standards which will be used to as the base to compare the actual performance of the
employees. This step requires setting the criteria to judge the performance of the
employees as successful or unsuccessful and the degrees of their contribution to the
organizational goals and objectives. The standards set should be clear, easily
understandable and in measurable terms. In case the performance of the employee
cannot be measured, great care should be taken to describe the standards.
COMMUNICATING THE STANDARDS:
Once set, it is the responsibility of the management to communicate the
standards to all the employees of the organization. The employees should be informed
and the standards should be clearly explained to the. This will help them to
understand their roles and to know what exactly is expected from them. The standards
should also be communicated to the appraisers or the evaluators and if required, the

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Performance Appraisal

standards can also be modified at this stage itself according to the relevant feedback
from the employees or the evaluators.
MEASURING THE ACTUAL PERFORMANCE:
The employees should be informed and the standards should be clearly explained
to the. This will help them to understand their roles and to know what exactly is
expected from them. The standards should also be communicated to the appraisers or
the evaluators and if required, the standards can also be modified at this stage itself
according to the relevant feedback from the employees or the evaluators.
COMPARING THE ACTUAL WITH THE DESIRED
PERFORMANCE :
The actual performance is compared with the desired or the standard
performance. The comparison tells the deviations in the performance of the
employees from the standards set. The result can show the actual performance being
more than the desired performance or, the actual performance being less than the
desired performance depicting a negative deviation in the organizational performance.
It includes recalling, evaluating and analysis of data related to the employees’
performance.
DISCUSSING RESULTS:
The result of the appraisal is communicated and discussed with the employees
on one-to-one basis. The focus of this discussion is on communication and listening.
The results, the problems and the possible solutions are discussed with the aim of
problem solving and reaching consensus. The feedback should be given with a
positive attitude as this can have an effect on the employees’ future performance. The
purpose of the meeting should be to solve the problems faced and motivate the
employees to perform better.
DECISION MAKING:
The last step of the process is to take decisions which can be taken either to
improve the performance of the employees, take the required corrective actions, or the
related HR decisions like rewards, promotions, demotions, transfers etc.

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Performance Appraisal

The Essentials of an effective performance system are as follows:

 Documentation – means continuous noting and documenting the

performance. It also helps the evaluators to give a proof and the basis of their
ratings.
 Standards / Goals – the standards set should be clear, easy to understand,
achievable, motivating, time bound and measurable.
 Practical and simple format - The appraisal format should be simple,
clear, fair and objective. Long and complicated formats are time consuming,
difficult to understand, and do not elicit much useful information.
 Evaluation technique – An appropriate evaluation technique should be
selected; the appraisal system should be performance based and uniform. The
criteria for evaluation should be based on observable and measurable
characteristics of the behavior of the employee.
 Communication – Communication is an indispensable part of the
performance appraisal process. The desired behavior or the expected results
should be communicated to the employees as well as the evaluators.
Communication also plays an important role in the review or feedback
meeting. Open communication system motivates the employees to actively
participate in the appraisal process.
 Feedback – The purpose of the feedback should be developmental rather
than judgmental. To maintain its utility, timely feedback should be provided to
the employees and the manner of giving feedback should be such that it should
have a motivating effect on the employees’ future performance.
 Personal Bias – Interpersonal relationships can influence the evaluation and
the decisions in the performance appraisal process. Therefore, the evaluators
should be trained to carry out the processes of appraisals without personal bias
and effectively.
 In order to make a performance appraisal system effective and successful, an
organization comes across various challenges and problems. The main
challenges involved in the performance appraisal process are:

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Performance Appraisal

 determining the evaluation criteria-Identification of the appraisal

criteria is one of the biggest problems faced by the top management. The
performance data to be considered for evaluation should be carefully selected.
For the purpose of evaluation, the criteria selected should be in quantifiable or
measurable terms
 Create a rating instrument-The purpose of the performance appraisal
process is to judge the performance of the employees rather than the
employee. The focus
 of the system should be on the development of the employees of the
organization.
 Lack of competence-Top management should choose the raters or the
evaluators carefully. They should have the required expertise and the
knowledge to decide the criteria accurately. They should have the experience
and the necessary training to carry out the appraisal process objectively.
 Errors in rating and evaluation-Many errors based on the personal bias
like stereotyping, halo effect (i.e. one trait influencing the evaluator’s rating
for all other traits) etc. may creep in the appraisal process. Therefore the rater
should exercise objectivity and fairness in evaluating and rating the
performance of the employees
 Resistance-The appraisal process may face resistance from the employees
and the trade unions for the fear of negative ratings. Therefore, the employees
should be communicated and clearly explained the purpose as well the process
of appraisal. The standards should be clearly communicated and every
employee should be made aware that what exactly is expected from him/her.
Purpose of Performance Appraisal:
Performance Appraisal is being practiced in 90% of the organizations worldwide.
Self-appraisal and potential appraisal also form a part of the performance appraisal
processes.
Typically, Performance Appraisal is aimed at:
 To review the performance of the employees over a given period of time.
 To judge the gap between the actual and the desired performance.

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Performance Appraisal

 To help the management in exercising organizational control.

 percentage of organizations (out of the total organizations surveyed i.e. 50)
using performance appraisal for the various purposes are as shown in the
diagram below To diagnose the training and development needs of the future.
 Provide information to assist in the HR decisions like promotions, transfers
etc.
 Provide clarity of the expectations and responsibilities of the functions to be
performed by the employees.

 To judge the effectiveness of the other human resource functions of the

organization such as recruitment, selection, training and development.

 To reduce the grievances of the employees.

 Helps to strengthen the relationship and communication between superior –
subordinates and management – employees.
METHODS OF PERFORMANCE APPRAISAL

Traditional Methods Modern Methods

Graphic rating scales. Behaviorally anchor rating scale

Ranking method Assessment center

Paired comparison method Human resources accounting

Forced Distribution method Management of objectives

Checklist methods Psychological appraisals

a. Simple Checklist

b. Weighted Checklist

c. Critical Incident Checklist

Essay or Freedom appraisal

Group appraisal

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Performance Appraisal

Confidential Reports

According to a recent survey, the

The most significant reasons of using Performance appraisal are:
 Making payroll and compensation decisions – 80%
 Training and development needs – 71%
 Identifying the gaps in desired and actual performance and its cause – 76%
 Deciding future goals and course of action – 42%
 Promotions, demotions and transfers – 49%
 Other purposes – 6% (including job analysis and providing superior support,
assistance and counseling)

METHODS OF PERFORMANCE APPRAISAL:

With the evaluation and development of appraisal system, a number of
methods or techniques of performance appraisal have been developed. The important
among them are
TRADITIONAL METHODS:
1. Graphic Rating Scale:
Graphic rating scales compare individual performance to an absolute standard.
In this method, judgments about performance are recorded on a scale. This is the
oldest and widely used technique. This method is also known as linear rating scale or
simple rating scale. The appraisers are supplied with printed forms, one for each
employee. These forms contain a number of objectives, behavior and trait-based
qualities and characters to be rated like quality and volume of work, job knowledge,
dependability, initiative, attitude etc. in the case of workers and analytical ability,
creative ability, initiative, leadership qualities, emotional stability in the case of
managerial personnel. These forms contain rating of scales. In continuous order like
0, 1,2,3,4 and 5 and in discontinuous scale the appraiser assigns the point to each
degree. The points given by the rater know performance regarding each character. The
points given by the rater to each character are added up to find out the overall
performance. Employees are ranked on the basis of total appoints assigned to each
one of them.

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Performance Appraisal

One reason for the popularity of the rating scales is its simplicity, which
permits many employees to be quickly evaluated. Such scales have relatively low
design cost and high in case of administration. They can easily pinpoint significant
dimensions of the job. The major drawback to these scales is their subjectivity and
low reliability. Another limitation is that the descriptive words often used in such
scales may have different meanings to different raters.
2. Ranking Method:
Under this method the employees are ranked from best to worst on some
characteristics. The rater first finds the employee with the highest performance and
the employees with the lowest performance in that particular job category and rates
the former as the best and the later as the poorest. Then the rater selects the next
highest and next lowest and so on until he rates all the employees in that group.
Ranking can be relatively easy and inexpensive, but its reliability and validity
may be open to doubt. It may be affected by rater bias or varying performance
standards. Ranking also means that somebody would always be in the backbench. It
is possible that the low ranked individual in one group may turnout to be superstar in
another group. One important limitation of the ranking method is that the size of the
difference between individuals is not well defined. For instance, there may be little
difference between those ranked third and forth.
3. Paired Comparison Method:
This method is relatively simple. Under this method, the appraiser ranks the
employees by comparing one employee with all other employees in the group, one at
a time. As illustrated, this method results in each employee being given a positive
comparison total and a certain percentage of the total positive evaluation.

4. Forced Distribution Method:

The rater may rate his employees at the higher or at the lower end of the scale under
the earlier methods. Forced distribution method is developed to prevent the raters
from rating too high or too low.

Under this method, the rater after assigning the points to the performance of each
employee has to distribute his ratings in a pattern to conform to normal frequency

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Performance Appraisal

distribution. Thus, similar to the ranking technique, forced distribution requires the
rates (supervisors) to spread their employee evaluation in a prescribed distribution.
This method eliminates central tendency and leniency biases. However, in this
method employees are placed in certain ranked categories but not ranked within the
categories.
Quite often work groups do not reflect a normal distribution of individual
performance. This method is based on the questionable assumption as group of
employees will have the same distribution of excellent, average and poor performers.
If one department as all outstanding employees, the supervisor would find it
extremely difficult to decide who should be placed in the lower categories.
Difficulties can also arise when the rater must explain to the employee why he was
placed in one grouping and others were placed in higher groupings.
5.Checklist Methods:
The checklist is a simple rating technique in which the supervisor is given a list of
statement or words and asked to check statements representing the characteristics and
performance of each employee.
a) Simple Checklist Method:
The checklist consists of large number of statements concerning employee
behavior.
Example: Simple Checklist Method
Wadia Industries Ltd.
Performance Appraisal Form
Name of Employee: Number:
Designation: Department:
Checklist of qualities Behavior:
1. Is the employee punctual in attending the office? Yes/No
2. Does the employee behave courteously with his superiors? Yes/No
3. Does the employee maintain should customer relations? Yes/No
4. Is the employee sincere in doing his job? Yes/No
5. Does the employee behave well with the public outside the organization?
Yes/No

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Performance Appraisal

The rater checks to indicate if the behavior of an employee is positive or

negative to each statement. Employee performance is rated on the basis of number
of positive checks. The negative checks are not considered in this method. A
difficulty often arises because the statements may appear to be virtually identical
in describing the employee. The words or statements may have different meanings
to different raters.

b) Weighted Checklist:
The weighted checklist method involves weighting different items in the
checklist having a series of statements about an individual, to indicate that some
are more important than others. The rater is expected to look into the questions
relating to the employee’s behavior, the attached rating scale (or simply positive-
negative statements where such a scale is not provided) and tick those traits that
closely describe the employee behavior. Often the weights are not given to the
supervisors who complete the appraisal process, but are computed and tabulated
by someone else, such as a member of the personnel unit. In this method the
performance ratings of the employee are multiplied by the weights of the
statements and coefficients are added up. The cumulative coefficient is the
weighted performance score of t employee. Weighted performance score is
compared with the overall assessment standards in order to find out the overall
performance of the employee.The weighted checklist, however, is expensive to
design, since checklist fo0r each different job in the organization must be
produced. This may prove time consuming also in the end. Though the weighted
checklist method is evaluative as well as developmental, it has the basis problem
of the evaluator not knowing the items, which contribute mostly of successful
performance

c) Forced Choice Method:

This method was developed at the close of World War II. Under this method, a
large number of statements in groups are prepared. Each group consists of four
descriptive statements (tetra) concerning employee behavior. Two statements are most
descriptive (favorable) and two are least descriptive (Un-favorable) or each tetrad.
Sometimes there may be five statements in each group out of which one would be
neutral. The actual weightings of the statements are kept secret. The appraiser is asked

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Performance Appraisal

to select one statement that mostly describes employee’s behavior out of the two
favorable statements and one statement from the two unfavorable statements.
The items are usually a mixture of positive and negative statements. The intent is
to eliminate or greatly reduce the rater’s personal bias, specially the tendency to
assign all high ort low ratings. The items are designed to discriminate effective from
ineffective workers as well as reflect valuable personal qualities.
6.Critical Incident Method:
Employees are rated discontinuously, I e. Once in a year or six months under the
earlier methods. The performance rates may not reflect real and overall performance,
as the rater would be serious about appraisal just two or three weeks before the
appraisal. Hence, a continuous appraisal method. I.e., critical incident method has
been developed.
Under this method, the supervisor continuously records the critical incidents of the
employee performance or behavior relating to all characteristics (both positive and
negative) in a specially designed notebook. The supervisor rates the performance of
his subordinates on the basis of notes taken by him.
Since the critical incident method does not necessarily have to be a separate
rating system, it can be fruitfully employed as documentation of the reasons why as
employee was rated in a certain way. The critical incident method has the advantage
of being objective because the rater considers the records of performance rather than
the subjective points of opinion.
7. Essay or Free Form Appraisal:
This method requires the manager to write a short essay describing each
employee’s performance during the rating period. This format emphasizes evaluation
of overall performance, based on strengths weaknesses of employee performance,
rather than specific job dimensions.
But asking supervisors to enumerate specific example of employee behavior, the
essay technique minimizes supervisory bias and halo effect.
8.Group Appraisal:
Under this method, an employee is appraised by a group of appraisers. This group
consists of the immediate supervisor of the employee, to other supervisors who have

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Performance Appraisal

close contact with the employee’s work, manager or head of the department and
consultants.
The head of the department or manager may be the chairman of the group and the
immediate supervisor may act as the coordinator for the group activities. This group
uses any one or multiple techniques discussed earlier. The immediate supervisor
enlightens others members about the job characters, demands, standards of
performance etc.
Then the group appraises the performance of the employee, compares the actual
performance with standards, find out the deviations, discusses the reasons therefore,
suggests ways for improvement of performance, prepares action plans, studies the
need for change in job analysis and standards and recommends change, if necessary.
This method is widely used for purpose of promotion, demotion and retrenchment
appraisal.
9.Confidential Report:
Assessing the employee’s performance confidentially is a traditional method of
performance appraisal. Under this method, superior appraises the performance of his
subordinates based on his observations, judgments and institutions.
The superior keeps his judgment and report confidentially. In other words the
superior dos not allowed the employee to know the report and his performance.
Superior writes the report about his subordinates, strengths, weaknesses, intelligence,
attitude to work, sincerity, commitment, punctuality, attendance, conduct, character,
friendliness, etc.
Though confidential report is a traditional method, most of the public sector
organizations still follow this method in appraising the employee’s performance. This
method suffers from a number of limitations.

MODERN METHODS:
1. Behaviorally Anchored Rating Scale (BARS):
The Behaviorally anchored Rating Scales (BARS) method combines elements
of the traditional rating scales and critical incidents method. Using BARS, job
behaviors from critical incidents – effective and ineffective behaviors are described
more objectively. The method employs individuals who are familiar with a particular

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Performance Appraisal

job to identify its major components. They then rank and validate specific behaviors
for each of the components.
BARS require considerable employee participation; its acceptance by both
supervisors and their subordinates may be greater. Proponents of BARS also claim
that such a system differentiates among behavior, performance and results, and
consequently is able to provide a basis for setting developmental goals for the
employee. Because it is job-specific and identifies observable and measurable
behavior, it is more reliable and valid method for performance appraisal.
2. Assessment Centre:
This method of appraising was first applied in German Army in 1930. Later
business and industrial houses started using this method. This is not a technique of
performance appraisal by itself. In fact it is a system or organization, where
assessment is done by several individuals and also by various experts by using various
techniques.
In this approach individual from various departments are brought together to
spend two or three days working on an individual or a group assignment similar too
the ones they’d be handling when promoted. All assesses get an equal opportunity to
show their talents and capabilities and secure promotion based on merit. An
assessment model is shown below.
a) Human Resource Accounting:
Human Resource Accounting deals with cost of and contribution of human
resource to the organization. Cost of the 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 labour productivity or value added by human resources.
b) Management by objectives:
The concept of ‘Management by Objectives’ (MBO) was first given by Peter
Drucker in 1954. It can be defined as a process whereby the employees with the
standards set. Ideally, when employees themselves have been involved with the goal
setting and the choosing the course of action to be followed by them, they are more
likely to fulfill their responsibilities. and the superiors come together to identify
common goals, the employees set their goals to be achieved, the standards to be taken

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Performance Appraisal

as the criteria for measurement of their performance and contribution and deciding the
course of action to be followed.
The essence of MBO is participative goal setting, choosing course of actions and
decision making. An important part of the MBO is the measurement and the
comparison of the employee’s actual performance
THE MBO PROCESS:

UNIQUE FEATURES AND ADVANTAGES OF MBO:

The principle behind Management by Objectives (MBO) is to create empowered

employees who have clarity of the roles and responsibilities expected from them,
understand their objectives to be achieved and thus help in the achievement of
organizational as well as personal goals.
Some of the important features and advantages of MBO are:
 The focus is on future rather than on past. Goals and standards are set for the
performance for the future with periodic reviews and feedback.
 Motivation – Involving employees in the whole process of goal setting and
increasing employee empowerment increases employee job satisfaction and
commitment.

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Better communication and Coordination – Frequent reviews and interactions

between superiors and subordinates helps to maintain harmonious relationships within
the enterprise and also solve many problems faced during the period.
3.Psychological appraisal:
Psychological appraisal are conducted to assess the employee potential,
Psychological appraisal consist of

a) In-depth interviews
b) Psychological tests
c) Consultations and discussions with the employee
d) Discussions with the superiors sub-ordinates and peers
e) Review of others evaluations.
Evaluation is conducted in the areas of
(a) employee’s intellectual abilities,
(b) emotional stability,
(c) motivational responses,
(d) sociability,
(e) employees ability to comprehend the vents, and
(f) ability to foresee the future.
The psychological appraisal results are useful for decision-making about (i) employee
placement, (ii) career planning and development and (iii) training and developme
4. 360 DEGREE FEEDBACK:
Also known as 'multi-rater feedback', is the most comprehensive appraisal where
the feedback about the employees’ performance comes from all the sources that come
in contact with the employee on his job.360 degree respondents for an employee can
be his/her peers, managers (i.e. superior), subordinates, team members, customers,
suppliers/ vendors - anyone who comes into contact with the employee and can
provide valuable insights and information or feedback regarding the “on-the-job”
performance of the employee.
360 degree appraisal has four integral components:
1. Self appraisal
2. Superior’s appraisal
3. Subordinate’s appraisal

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Performance Appraisal

4. Peer appraisal.

Self appraisal gives a chance to the employee to look at his/her strengths and
weaknesses, his achievements, and judge his own performance. Superior’s appraisal
forms the traditional part of the 360 degree appraisal where the employees’
responsibilities and actual performance is rated by the superior. Subordinates
appraisal gives a chance to judge the employee on the parameters like communication
and motivating abilities, superior’s ability to delegate the work, leadership qualities
etc. Also known as internal customers, the correct feedback given by peers can help to
find employees’ abilities to work in a team, co-operation and sensitivity towards
others.

Self assessment is an indispensable part of 360 degree appraisals and therefore

360 degree Performance appraisal have high employee involvement and also have the
strongest impact on behavior and performance.
It provides a "360-degree review" of the employees’ performance and is
considered to be one of the most credible performance appraisal methods.
360 degree appraisal is also a powerful developmental tool because when
conducted at regular intervals (say yearly) it helps to keep a track of the changes
others’ perceptions about the employees. A 360 degree appraisal is generally found
more suitable for the managers as it helps to assess their leadership and managing
styles. This technique is being effectively used across the globe for performance
appraisals. Some of the organizations following it are Wipro, Infosys, and Reliance
Industries etc.

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Performance Appraisal

360 degree feedback, also known as 'multi-rater feedback', is the most

comprehensive appraisal where the feedback about the employees’ performance
comes from all the sources that come in contact with the employee on his job. 360
degree respondents for an employee can be his/her peers, managers (i.e. superior),
subordinates, team members, customers, suppliers/ vendors - anyone who comes into
contact with the employee and can provide valuable insights and information or
feedback regarding the “on-the-job” performance of the employee.
5. SYSTEM OF PERFORMANCE APPRAISAL:
Performance appraisal is a nine-step process.
1. Establish performance standards.
2. Communicate standards/expectations to employee
3. Measure actual performance due to the environmental influences.
4. Adjust the actual performance due to the environmental influences.
5. Compare the adjusted performance what that of others and previous.
6. Compare the actual performance with standards and find out deviations, if
any.
7. Communicate the actual performance to the employee concerned.
8. Suggest changes in job analysis and standard, if necessary.
9. Follow-up performance appraisal report.

At the first stage, performance standards are established based on the job
description and job specification. The standard should be clear, objective and
incorporate all the factors.
The second stage is to inform these standards to all the employees including
appraisers.
The third stage is following the instructions given for appraisal, measurement of
employee performance by the appraisers through observations, interviews, records
and reports.
Fourth stage is finding out the influence of various internal and external factors on
actual performance. The influence of these factors may be either inducing or
hindering the employee performance. The measured performance may be adjusted
according to the influence of external and internal factors. The performance derived at
this stage may be taken actual performance.

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Performance Appraisal

Fifth stage is comparing the actual performance with that of other employees and
previous performance of the employee and others. This gives an idea where the
employee to the influence of external and internal factors. The performance derived at
this stage may be taken actual performance.
Sixth stage is comparing the actual performance with the standards and finding
out deviations. Deviations may be positive or negative. If employee’s performance is
more than standards, it is positive deviation and vice-versa is negative deviation.
Seventh stage is communicating, the actual performance of the employee and
others employees doing the same job and discuss with him about the reasons for the
positive or negative deviations from the pre-set standards as the case may be.
Eight stage is suggestions necessary changes in standards in standards, job
analysis, and internal and external environment.
Ninth stage is follow-up of performance appraisal report. This stage includes
guiding, counseling, coaching and directing the employee or making arrangements for
training and development of the employee in order to ensure improved performance.
If actual performance is very poor and beyond the scope of improvement it is
necessary to take steps for demotion or retrenchment or any other suitable measure.
Key elements of performance appraisal system are presented in figure below.
6.Counseling:
After the performance of the employee is appraised, the superior should inform the
employee about the level of his performance, the reason for the same, need for and the
methods of improving the performance. The superior should counsel the employee
about his performance and the methods of improving it.Counseling is a planned,
systematic intervention in the life of an individual who is capable of choosing the goal
and the direction of his development. Thus, the purpose of counseling is to help the
employee aware of his own performance, his strengths and weaknesses, opportunities
availabilities available for performance counseling can be done in the form of
performance interview by the superior.
7.The Post 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 appraiser to explain the

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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 the reality
factors, and helps the appraiser to offer his suggestions, help, guide and coach the
employee for his advancement.
Thus, the post appraisal interview is designed to achieve the following
objectives.
1. To let employees know where they stand.
2. To help employees do a better job by clarifying what is expected of them
3. To plan opportunities for development and growth
4. To strengthen the superior-subordinate working relationship by developing a
mutual agreement of goals
5. To provide an opportunity for employees to experience themselves on
performance related issues.
The post appraisal interview is most helpful to the employee as well as his
superior Relating Performance Appraisal to Rewarding Management should recognize
and performance. The forms of recognizing and rewarding performance include:
(a) Private and public praise,
(b) written commendation,
(c) published commendation,
(d) in creased autonomy,
(e) change in job title
(f) status symbols like office space, furnishings,
(g) performance bonuses,
(h) salary increases
(i) promotion in grade, or increase in responsibilities and
(j) various forms of supplementary compensation.

Managers should match the rewards both with performance and with the
perception and needs of the employee.

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Performance Appraisal

Managerial Appraisal:
It is relatively easy to appraise the performance of technical or operative
employees compared to managerial personnel. This is because the performance of
operative employees can be measured quantitatively, whereas the performance of
managers cannot be determined quantitative terms. Harold Koontz has developed a
concept of managerial functions, viz., planning, organizing, leading
motivating staffing and controlling.
Performing a number of or series of activities can perform each of these3
functions. For example, performing staffing functions requires performing a series of
activities like analyzing jobs of his department, planning for human resources,
deciding upon internal and external recruitment. Thus each function and sub functions
of manager are elaborated into a series of activities.
The checklist contain the questions in these areas is prepared with a five
degree rating scale, i.e., externally poor performance, neither poor nor fair
performance and externally fair performance. Thus this technique measures the
performance of managers in managing organizational environment.

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DATA ANALYSIS AND INTERPRETATION

4.1 How often your management appraises the performance of the

employee?

Opinion No. of respondents Percentage

Quarterly 24 20

Half yearly 16 13

Annually 80 67

Total 120 100

GRAPH4.1

80

70

60
RESPONDENTS

50

40 %of respondents

30

20

10

0
Quarterly Half yearly Annually
OPINION

INFERENCE:
From the above analysis 20%are favorable to quarterly, and 13% are favorable
to half yearly, and 67% are favorable to annually towards management appraisals.

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Performance Appraisal

4.2 On which basis does the organization appraises?

Opinion No. of respondents Percentage

Skills 31 25

Responsibility 22 18

Job knowledge 20 17

Seniority 38 32

Others 9 8

Total 120 100

GRAPH4.2

INFERENCE:
From the above table it can be inferred that the organization appraises on the
basis of seniority at 32% and on the basis of skills at 25% and on the basis of
responsibility 18% on the basis of job knowledge 17%.

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Performance Appraisal

4.3 In which form your organization been evaluating the performance

appraisal?

Opinion No.of respondents Percentage

Oral 14 12

Written 36 30

Observation 45 38

Online 15 13

Others 10 7

Total 120 100

GRAPH4.3

40

35

30
RESPONDENCE

25

20 %of respondents

15

10

OPINION

INFERENCE:

From the above graph 38% are favorable to observation, and 30% are
favorable to written, and 13% are favorable to online method of performance and 12%
are favorable to oral method

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4.4 Which method is followed by the organization evaluate the

performance

Opinion No .of respondents Percentage

Graphic rating scale 16 13

Ranking method 50 42

Check list method 25 21

Forced choice method 10 8

Group appraisal 19 16

Total 120 100

GRAPH4.4

INFERENCE:

From the above analysis we can say that the organization evaluate the
performance appraisal through ranking method at 42% and check list method at 21%

4.5 Does the organization offer any rewards after appraising.

Opinion No. of respondents Percentage

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Yes 76 63

NO 44 37

Total 120 100

GRAPH4.5

INFERENCE:
63% of the employees agree that the organization offered rewards after the
appraisal and 37% are disagree that the organization offered the rewards.

4.6 What type of rewards are offered

Opinion No.of respondents Percentage

Promotions 50 42

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Transfer 20 17

Increments 35 29

Others 15 12

Total 120 100

GRAPH4.6

INFERENCE:
From the above graph 42% are favored to promotions and 29% are favored to
increments, and 17% are favored to transfers.

4.7 Are you getting feedback from the appraiser.

Opinion No. of respondents Percentage

Yes 51 42

No 69 58

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Total 120 100

GRAPH4.7

INFERENCE:
From the above analysis we can say that only 42% of the employees
getting their feedback from appraises, the remaining are not getting feedback from
appraises.

4.8 Does the feedback helps you to change

Opinion No.of respondents Percentage

Yes 65 54

No 55 46

Total 120 100

GRAPH4.8

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INFERENCE:
From the above analysis we can say that, only 54% of the employees agree
that the feedback is helping to change and the other 46% is disagree.

4.9 Are you aware of the importance of the performance appraisal system?

Opinion No of respondents Percentage

Fully aware 24 20

Partly aware 29 24

Not aware 67 56

Total 120 100

GRAPH4.9

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INFERENCE:
From the above analysis we can say that, 20% of the employees fully aware
from the appraising method and the 24% are partly aware,and 56% are not aware
from the appraising method.

4.10 In which way do you satisfied management identified strenths and skills
through performance appraisal.

Opinion No. of respondents Percentage

Strongly agree 19 16

Agree 48 40

Neither agree nor disagree 25 21

Disagree 20 17

Strongly disagree 8 6

Total 120 100

GRAPH4.10

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45
40
35
30
RESPONDENCE

25
%of respondents
20
15
10
5
0
Strongly agree Agree Neither agree Disagree Strongly
nor disagree disagree
OPINION

INFERENCE:
Yearly 40% of the employees are agree that able to identified their individual
strength and skills through performance appraisal system and 16% are s.agree and
17% are disagree.

4.11 How is your communication between employer and supervisor.

Opinion No.of respondents Percentage

Excellent 25 21

Good 67 56

Upto some extent 18 15

Poor 8 7

Very poor 2 1

Total 120 100

GRAPH4.11

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INFERENCE:
56% of the employees says that, the communication between employer and
supervisor is good and 21% are says that excellent and75% says that poor and 1%
says that very poor.

4.12 The performance appraisal is useful to develop the skills of employee.

Opinion No.of respondents Percentage

Strongly agree 15 12

Agree 21 26

Neither agree nor disagree 18 15

Disagree 50 42

Strongly disagree 6 5

Total 120 100

GRAPH4.12

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INFERENCE:
Nearly 26% of the employees agree that the performance appraisal is useful to
develop their skills and 42% are disagree and 5% are strongly disagree .

4.13 Indicate the level of co-operation received from the superior?

Opinion No.of respondents Percentage

Excellent 20 17

Good 60 50

Up to some extent 38 31

Poor 12 2

Total 120 100

GRAPH4.13

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INFERENCE:
50% of the employees says that the level of co-operation received from their
superiors is good and 17% are says that the level of cooperation is excellent.

4.14Performance Appraisal is the primary tool in the organization to asses

promotions
GRAPH4.14

Opinion No. of respondents Percentage

Strongly Disagree 8 7

Disagree 20 17

Undecided 10 8

Agree 55 46

Strongly agree 27 22

Total 120 100

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INFERENCE

From the above table 46% of the respondents expressed agree that the
performance appraisal is the primary tool to asses promotions and 22% is strongly
agree.

4.15 The organization conducts any training and development programs for
employees after the performance appraisal.

Opinion No.of respondents Percentage

Yes 32 27

No 88 73

Total 120 100

GRAPH4.15

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INFERENCE:
27% of the employees agree, and 73% is disagree that the organization
conducts training and development programs after their performance appraisal.

4.16 Are you satisfied with the method of performance appraisal

followed by the management?
Opinion No .of respondents Percentage

Highly satisfied 14 12

Satisfied 47 31

Neither satisfied nor dis- 18 13

satisfied

Dis-satisfied 32 27

Highly dis-satisfied 9 7

Total 120 100

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GRAPH4.16

INFERENCE:
31% of the employees says that, they satisfied with the method of performance
appraisal followed by the management, 27% of the employees says that, they dis-
satisfied with the method of performance appraisal followed by the management.

4.17 Whether the organization provides counseling after performance appraisal

when necessary.

Opinion No.of respondents Percentage

Yes 59 51

No 61 49

Total 120 100

GRAPH4.17

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INFERENCE:
There are 50-50 chances that the organization provides the counseling after
their performance appraisal when necessary.

5.1 FINDINGS

 80% of the respondents says that performance appraisal will be taken

annually.

 14% of the respondents says that organization follows oral performance

method.

 76% of the respondents says that organization offers promotions after

appraisal.

 69% of the respondents says that they are not getting feedback after appraisal.

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 67% of the respondents they are not aware of the performance appraisal

system.

 88% of the respondents says that the organization is not conducting any

training and development programs for employs after the performance

appraisal.

5.2 SUGGESTIONS
 The organization has to give feedback to employees after appraisal.

 The organization has to create awareness to the employees about performance

appraisal system.

 The organization has to bring out the skills of the employees by conducting

good appraisal method.

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 The organization has to conduct more training and development programs

after the appraisal system.

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5.3 CONCLUSION
The performance appraisal which is conducted by the organization is very

effective. The management gives the promotions based on both merit and seniority.

Most of the employees are satisfied with the performance appraisal which is

conducted by the organization. The performance appraisal is mostly based on the job

analysis.

Hence the performance appraisal is necessary for every organization to

achieve its objectives.

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QUESTIONNARIE

NAME:

AGE:
GENDER:
1. How often your management appraises the performance of the employee?
a) Quarterly b) Half-yearly c) Annually [ ]

2. On what basis does the organization appraises? [ ]

a) Skills b) Responsibility c) Job knowledge d) Seniority e) Others

3. In which form your organization has been evaluating the performance appraisal?
[ ]
a) Oral b) Written c) Observation d) Online e) Others

4. Which method is followed by the organization evaluate the performance

appraisal? [
a) Graphic rating scale b) Ranking method
c) Check list method d) Forced choice method
e) Group appraisal

5. Does the organization offer any rewards after appraising? [ ]

a) Yes b) No

6. If yes, what rewards are offered? [ ]

a) Promotions b) Transfers
c)Increments d) Others
7. Are you getting your feedback from appraiser? [ ]
a) Yes b) No
8. Does the feedback help you to change? [ ]
a) Yes b) No

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9. Are you aware of importance of Performance Appraisal System? [ ]

a) Fully aware b)Partly aware c)Not awa
10. How is your communication between employer and supervisor? [ ]
a) Excellent b) Good c) Up to some extent
d) Poor e) Very poor

11. .Is the performance appraisal useful to develop the skills of employee? [ ]
a) Strongly agree b) Agree c) Neither agree nor disagree
d) Disagree e) strongly disagree

12. Indicate the level of co-operation received from your superior? [ ]

a) Excellent b) Good c) Up to some extent d) Poor

13. Does The organization provides fair and equitable compensation based on
performance? [ ]
a) Yes b) No

14. Does Performance Appraisal is the primary tool in your organization to asses
Promotions? [ ]
a) Strongly disagree b) Disagree c) Undecided
d) Agree e) Strongly Agree

15. Whether the organization conducts any training and development Programs for
employees after the performance appraisal? [ ]
a) Yes b) No
16. Are you satisfied with the method of performance appraisal followed by
the Management? [ ]
a) Highly satisfied b) Satisfied
c) Dis-satisfied d) highly dis-satisfied

17. Whether the organization provides counseling after performance appraisal when
necessary? [ ]
a) Yes b) NO

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BIBLIOGRAPHY

1. PERSONNEL MANAGEMENT

-C.B.MAMORIA

2. HUMAN RESOURCES MANAGEMENT AND INDUSTRIAL

RELATIONS -P.SUBBARAO

3. PERSONNEL MANAGEMENT -MONAPPA

4. HUMAN RESOURCE AND PERSONNEL MANAGEMENT

-K. ASWATHAPPA

Websites:

 www.amararajabatteries.com

 www.arbl.com.

www.wikipedia.coms

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