HRM Project

Analyzing Performance Appraisal System

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ACKNOWLEDGEMENT
Vital to every operation is co-operation. We really agree to this wonderful quotation put forth by Mr. Frank Tyger. This project was successful due to the co-operation extended by people who have truly contributed towards it. We gratefully acknowledge Prof. ______ whos deep sharing and synergy has moved us many levels beyond our own thinking. We want to thank the management of various companies who gave us the permission to conduct research. We would also like to thank all the employees and HR executives who empowered us with valuable information. And finally to those whose lives and writings has come the wisdom of the ages. We have tried to learn from your legacy.

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ABSTRACT
Appraisal is a continuous process and done annually as a formal exercise before completion of the financial year. Appraisal has tremendous motivational impact on people through meaningful feedback and is a powerful tool for recognition. This project explains performance appraisal system and tries to find out how efficiently Performance Appraisal is conducted. And if performance appraisal doesnt meet its objective then, what are the factors causing failure.

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TABLE OF CONTENTS
Sr. No 1 2 3 4 5 6 7 Title Introduction Research & Survey Results Findings and Recommendations Conclusion Appendices Bibliography Page No 1 5 6 23 26 27 31

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INTRODUCTION
Ask anyone what his or her greatest fear is and the answer would come up with almost universal that is death. More than the fact that we will no longer be able to pursue our passion and aspiration after we have passed away is the feat that we would no longer be therefore the people we so dearly cherish. Thankfully, there is life insurance to somewhat guarantee our love ones some initial from of sustenance in the event of our passing. A life insurance would ensure that our loved ones would receive some resources that would help cushion the pain of our loss. The amount depends on some factors, but resources are resources and they would go along, long way and making sure that the people dearest to us would be well taken cared of after our eventual death.

What is insurance?
Insurance is one of life's necessities and probably the least-understood financial product. Insurance reimburses people for covered losses in the event of an unfortunate occurrence such as an illness, accident, or death. At the same time, it can encourage prevention and safety measures, provide investment capital, lend money, and help to reduce anxiety for society at large. As a mechanism against loss of income and a means of safeguarding assets, many Indians have insurance in one form or another. These coverages may include public coverage, such as disability insurance, a health care policy from an employer, or personal insurance to protect property such as homes, computers and cars. Understanding life insurance becomes easier when one realizes that insurance was a concept developed to transfer a person's risks to another party, thereby protecting the insured person in the event of any calamity. Until something happens, such as a car accident, an illness, or the death of a loved one, paying for insurance may seem like buying something you'll never use. But even if you never submit a claim, insurance is an investment in your future, as important as pensions and personal investments.

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BENEFITS OF LIFE INSURANCE

Depending on its usage, life insurance gives various benefits. They are as follows:

Income for Family

Life insurance proceeds ensure a source of financial security for your family to meet its household and living expenses.

Pay of Debts
On the unfortunate death of the insured, the proceeds from a life insurance policy can be used to meet outstanding debts such as mortgages, car loans or charge account balances.

Provide Educational Funding For Children

The cash value of a whole life insurance policy can be used to help accumulate funds for the higher education of insureds children.

Equalize Inheritance
When an asset such as the family business passes on to family members who are active in it, life insurance proceeds can be used to provide equal assets to other family members Apart from these there are also Investment advantages to the Insurance. While most investment options make a persons money work harder, they are no substitutes to life insurance. That's because when a person takes up a life insurance policy, he enjoy the twin benefit of risk protection as well as returns on savings.

Life insurance enables a person to enjoy savings that guarantee full protection against the risk of death of the insured. These long-term savings are made in an easy and hassle-free manner because of low and convenient installments (or premiums).

Life insurance also encourages 'forced thrift'. This means that the insured is made to pay his/her premiums by saving his/her money, which he/she might not do in the regular course of life. 6|Page

Some life insurance policies often allow insured to take loans against his policy, should he require money to meet any unforeseen expenditure. What's more, some life insurance policies also allow saving on taxes.

BENEFITS OF TAKING POLICY

1. Protection: Saving through life insurance guarantee financial protection

against risk of death of the policyholder. In life insurance, on death, the full assured is payable (with bonuses whenever applicable) whereas in other saving schemes, only the amount saved (with interest is payable).
2. Aid to thrift: Life insurance encourages thrift. Long term saving can be

made in a relatively painless manner because of the easy installment facility (premiums can be paid through monthly, quarterly, half-yearly or yearly installment). The salary saving schemes properly known as SSS provides a convenient method of paying premium each month through deduction from ones salary.

3.Liquidit y: loans can be raised on endowment type and whole life policies as per policy conditions on the sole security of a policy, which has acquired a paid-up value. Besides, a life insurance is also generally accepted as security for even a commercial loan/housing loan. 4. Tax Relief: Tax relief in income tax is available for amounts paid by way of premium for life insurance subject to the income tax rules in force. Assesses can avail themselves of provisions in the law for tax relief. In such cases the assured in affect pays a lower premium for his insurance than he would have to pay otherwise. 5.Money When You Need It: A suitable insurance plan or a combination of different plans can be taken to need specific needs that are likely to arise in future, such as childrens

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HOW DOES INSURANCE FUNCTION?

The function of insurance is to protect a person against losses he can't afford. This is done by transferring the risks of a person, business, or organization -- the "insured" -- to an insurance company, or "insurer." The insurer then reimburses the insured for "covered" losses -- i.e., those losses it pays for under the policys term. As the insurance consumer, one has to pay an amount of money, called a premium, to the insurer to transfer the risk. The insurer pools all its premiums into a large fund, and when a policyholder has a loss, the insurer draws funds from the pool to pay for the loss. Life is full of unexpected events that can create large financial losses. For example, whenever you drive, it is possible that you may have a costly accident. Risks affect you by causing worry about potential loss and how to deal with the consequences. Insurance reduces anxiety over a possible loss and absorbs the financial brunt of its consequences

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EVOLUTION OF INSURANCE

One of the earliest forms of life insurance existed during the Greek and Roman times when following an individual's death, all surviving members made contributions for the burial services. It was only much later, in the 17th century, when a formal form of life insurance was introduced. This was under the Tontine Annuity System wherein associations of individuals were formed and a fund was created by equal contributions from each member. This sum was invested, and at the end of each year, the dividend was distributed among the surviving members. In all of this, the last remaining survivor received the entire amount of the principal. With the passage of time, life insurance has evolved into being an easy and affordable means of providing financial security for the insured and his/her family, in the event of the death of the insured or his/her inability to earn due to physical disabilities.

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INSURANCE IN INDIA
The insurance sector in India has come a full circle from being an open competitive market to nationalization and back to a liberalized market again. Tracing the developments in the Indian insurance sector reveals the 360-degree turn witnessed over a period of almost two centuries.

A brief history of the Insurance sector

The business of life insurance in India in its existing form started in India in the year 1818 with the establishment of the Oriental Life Insurance Company in Calcutta. Some of the important milestones in the life insurance business in India are:

1912: The Indian Life Assurance Companies Act enacted as the first statute to regulate the life insurance business.

1928: The Indian Insurance Companies Act enacted to enable the government to collect statistical information about both life and non-life insurance businesses.

1938: Earlier legislation consolidated and amended to by the Insurance Act with the objective of protecting the interests of the insuring public.

1956: 245 Indian and foreign insurers and provident societies taken over by the central government and nationalized. LIC formed by an Act of Parliament, viz. LIC Act, 1956, with a capital contribution of Rs. 5 crore from the Government of India.

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INSURANCE SECTOR REFORMS

In 1993, Malhotra Committee, headed by former Finance Secretary and RBI Governor Mr. R.N. Malhotra, was formed to evaluate the Indian insurance industry and recommend its future direction. The Malhotra committee was set up with the objective of complementing the reforms initiated in the financial sector. The reforms were aimed at creating a more efficient and competitive financial system suitable for the requirements of the economy keeping in mind the structural changes currently underway and recognizing that insurance is an important part of the overall financial system where it was necessary to address the need for similar reforms In 1994, the committee submitted the report and some of the key recommendations included : -

Structure
Government stake in the insurance Companies to be brought down to 50%
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Government should take over the holdings of GIC and its subsidiaries

so that these subsidiaries can act as independent corporations

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All the insurance companies should be given greater freedom to operate

Competition

Private Companies with a minimum paid up capital of Rs.1bn should be allowed to enter the industry
o

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 No Company should deal in both Life and General Insurance through a single entity
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Foreign companies may be allowed to enter the industry in collaboration with the domestic companies
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Postal Life Insurance should be allowed to operate in the rural market

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Only one State Level Life Insurance Company should be allowed to operate in each state

Regulatory Body
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The Insurance Act should be changed

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An Insurance Regulatory body should be set up

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Controller of Insurance (Currently a part from the Finance Ministry) should be made independent

Investments

Mandatory Investments LIC Life Fund in government securities to be reduced from 75% to 50%
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GIC and its subsidiaries are not to hold more than 5% in any company (There current holdings to be brought down to this level over a period of time) 12 | P a g e

Customer Service
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LIC should pay interest on delays in payments beyond 30 days

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Insurance companies must be encouraged to set up unit linked pension plans

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Computerization of operations and updating of technology to be carried out in the insurance industry

The committee emphasized that in order to improve the customer services and increase the coverage of the insurance industry should be opened up to competition. But at the same time, the committee felt the need to exercise caution as any failure on the part of new players could ruin the public confidence in the industry.
Hence, it was decided to allow competition in a limited way by stipulating the minimum capital requirement of Rs.100 crores. The committee felt the need to provide greater autonomy to insurance companies in order to improve their performance and enable them to act as independent companies with economic motives. For this purpose, it had proposed setting up an independent regulatory body.

THE INSURANCE REGULATORY AND DEVELOPMENT AUTHORITY (IRDA)

Reforms in the Insurance sector were initiated with the passage of the IRDA Bill in Parliament in December 1999. The IRDA since its incorporation as a statutory body 13 | P a g e

in April 2000 has fastidiously stuck to its schedule of framing regulations and registering the private sector insurance companies. The other decisions taken simultaneously to provide the supporting systems to the insurance sector and in particular the life insurance companies were the launch of the IRDAs online service for issue and renewal of licenses to agents. The approval of institutions for imparting training to agents has also ensured that the insurance companies would have a trained workforce of insurance agents in place to sell their products. Since being set up as an independent statutory body the IRDA has put in a framework of globally compatible regulations. In the private sector 12 life insurance and 6 general insurance companies have been registered.

Current situation
While other nations have witnessed fierce competition in their insurance sectors, Indias historical situation has resulted in lack of momentum and hence penetration. 14 | P a g e

This has left a majority of the population uninsured. This is the potential that insurers will tap and as a result, the sector will explode into a hot cauldron of companies fighting for a share of the consumers wallet. Entry of private players has broken the monopoly of LIC in the insurance sector. But even though the market share of LIC reduces, it will still retain its number one position for several years. Going forward, the private sector is expected to garner approximately 25 per cent market share. The winners in this game will undoubtedly be the customers who will receive superior products & services, and of course, the nations treasury. The opening of the insurance sector will therefore result in a healthier economy. As a percentage of GDP, Life Insurance is just about 1.4 percent. So, the challenge is to increase both average amounts for which each person gets insured as well as to increase the overall coverage of insurance across the population. The insurance sector is likely to grow to about $ 35 billion dollars by 2008 from the current $7.2 billion. Two things that stand out in Indian Insurance Industry are that of the low awareness of insurance need amongst the Indian consumer and therefore low penetration in the market. Second is that of the absence of a range of suitable products available for the consumers to suit his needs. Now Let us have a look how Private Players ICICI Prudential & Birla Sunlife Insurance has performed in the Indian Life Insurance market and what strategies have they followed to become the Number two and number three in the market respectively with a sizeable market share just in the span of two years.

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COMPANY PROFILE OF BHARTI AXA

Bharti AXA Life Insurance is a joint venture between Bharti, one of Indias leading business groups with interests in telecom, agri business and retail, and AXA, world leader in financial protection and wealth management. The joint venture company has a 74% stake from Bharti and 26% stake of AXA. The company launched national operations in December 2006. Today, we have over 8000 employees across over 12 states in the country and a national footprint of distributors trained to provide quality financial advice and insurance solutions to the large Indian customer base. As we further expand our presence across the country with a large network of distributors, we continue to provide innovative product and service offerings to cater to specific insurance and wealth management needs of customers. Whatever your plans in life, you can be confident that Bharti AXA Life will offer the right financial solutions to help you achieve them. The vision of Bharti AXA Life Insurance Company Limited is to become the preferred life insurance company in India. This vision extends to our recruitment philosophy as well. Both the Bharti Group in India and AXA globally enjoy the status of being a very employee focused organization. At Bharti AXA Life Insurance, we are determined to achieve our vision through talent who are empowered, focused on customer service, and champions of strategic and operational excellence

VISION
To be a leader and the preferred company for financial protection and wealth management in India 16 | P a g e

VALUES

Professionalism

Innovation

Team Spirit

Pragmatism

Integrity

Strategy

To achieve a top 5 market position in India through a multi-distribution, multi-product platform

To adapt AXA's best practice blueprints as a sound platform for profitable growth

To leverage Bharti's local knowledge, infrastructure and customer base

To deliver high levels of shareholder return

To build long term value with our business partners by enhancing the proposition to their customers

To be the employer of choice to attract and retain the best talent in India

To be recognised as being close and qualified by our customers

Strategic differentiators

Strong partner Bharti - provides access to customer base of more than 20 million

Multi channel execution capability

Current Asia product range which is a strong match to products sold to the mass and mass affluent

Global scale providing cost effective and speedy re-use of systems, products and business capability

INDIVIDUAL PLANS OF BHARTI AXA

BHARTI AXA LIFE GUARANTEE
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A Unit Linked Guarantee Plan Guarantee Builder provides you with a comfort factor on your investments and you can be sure that this comfort factor keeps building year-on-year. It's a solid investment plan that lets you achieve your long-term goals by investing in a mix of debt and equities, while providing a Guaranteed Maturity Value over 15 years. What's more, you need not worry about your family's security as it has a strong life insurance protection embedded. . Guarantee Builder provides you with a comfort factor on your investments and you can be sure that this comfort factor keeps building year-on-year. It's a solid investment plan that lets you achieve your long-term goals by investing in a mix of debt and equities, while providing a Guaranteed Maturity Value over 15 years. What's more, you need not worry about your family's security as it has a strong life insurance protection embedded.

Key Benefits:

Ensure solid protection for your family through a Death Benefit that offers Sum Assured PLUS Fund Value

Get the comfort of a Guaranteed Maturity Value (GMV) which means atleast your investment premiums are returned at maturity. Get the power of Builder, which means that you can expect your GMV to potentially increase by 1% each year till it reaches 115% by the time Guarantee is applicable.

The new Build n Protect Fund ensures not only safety to your investments, but also provide you the springboard for growth of your investments over the long-term by allocating upto 40% in large-cap stocks.

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BHARTI AXA LIFE BRIGHT STARS

A Unit Linked Child product. Bharti AXA Life Bright Stars provides a launch pad for your childs bright future. What else, You also have Jumpstart benefit which is paid out at maturity along with Policy Fund Value, which enables your child to explore more career options. Bharti AXA Life Bright Stars provides a launch pad for your childs bright future. What else, You also have Jumpstart benefit which is paid out at maturity along with Policy Fund Value, which enables your child to explore more career options.

Key Benefits:

Get 360` protection in securing your childs future.

o

Payment of sum assured immediately on death;

o

Payment of future premiums by the company till maturity;

o

Get Policy Fund Value along with Jumpstart benefit at maturity.

A Jumpstart benefit to boost your maturity proceeds.

A flexible Policy which adjusts to your financial needs by giving you various options like top ups, choice of investment funds, switch, withdrawals, cover continuance option, decrease in premium and more.

Choice of 5 policy terms to match your financial goals.

Get tax benefits on the premiums paid and benefits received as per the prevailing tax laws.

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Bharti AXA Life Spot Suraksha

Spot Suraksha helps you create a pool of wealth to meet your long-term needs, with an added advantage of simplified buying process Spot Suraksha helps you create a pool of wealth to meet your long-term needs, with an added advantage of simplified buying process

Key Benefits:

Easy to buy Investment solution - with a simplified proposal form, no medical examinations & you are insured on the spot with the issuance of a cover note!!

130% of first year premium is returned as Guaranteed Special Addition on death or on Maturity.

Allocation rates 100% from year 2 onwards!

3 investment fund options as per your investment preferences & the facility to switch amongst the investment funds as per your investment objectives.

Flexibility of partial withdrawals after fifth Policy Year, cover continuance option after seven policy years

Tax benefits under section 80C and 10(10D) of Income Tax Act.

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BHARTI AXA DREAM LIFE PENSION

A Unit Linked Pension Product Dream Life Pension, Bharti AXA Life Insurance's unique pension product ensures that your retirement life is your Dream Life. Live your Dreams! Be Life Confident. Dream Life Pension, Bharti AXA Life Insurances unique pension product ensures that your retirement life is your Dream Life. Live your Dreams! Be Life Confident.!

Key Benefits:

Unmatched flexibility for retirement wealth creation

o

o Pay one time lump sum or regular premiums At the inception systematically increase your premiums by 5 % or 8% each year with the Accumulator Option o Increase/decrease premiums any time after the 2nd policy year
o o

o Add top up premiums any number of times after the 1st policy year

Dream Life Pension enhances your retirement kitty by providing special addition, starting from the end of 10th policy year

Change your planned retirement age any time during the policy term

Obtain tax benefits as per the prevailing tax laws on the premiums paid and the benefits received under the policy.

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BHARTI AXA LIFE ASPIRELIFE

Unit Linked Endowment Product. Aspire Life helps you create a pool of wealth to meet your long-term needs, while also providing you adequate protection in case the need arises. Aspire Life helps you create a pool of wealth to meet your long-term needs, while also providing you adequate protection in case the need arises. Now you can be confident of your long term financial goals turning into reality. Be Life Confident.

Key Benefits:

o Allocation rates as high as 100% i.e. no allocation charges for premiums greater than or equal to Rs.50,000 on your investment in the unit-linked fund from year 2 - to maximize your investment returns.
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o Up to 175% of the first year premium paid by you is returned as Guaranteed Special Addition, at maturity of the policy or on unfortunate event of death of the Life Insured.

3 investment fund options as per your investment preferences.

o Flexibility of partial withdrawals after fifth Policy Year, premium holiday option after seven policy years and facility to switch amongst the investment funds as per your investment objectives.

o Protection benefit which provides high Sum Assured for longer policy terms. o Tax benefits under section 80C and 10(10D) of Income Tax Act

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BHARTI AXA LIFE INVESTCONFIDENT

Unit Linked Single Premium Product.
You have always strived hard to achieve the best for you and your loved ones, so when it comes to making an investment decision, we know that you would expect the best from it too. You have always strived hard to achieve the best for you and your loved ones, so when it comes to making an investment decision, we know that you would expect the best from it too. Presenting InvestConfident, a unique single premium, unit linked investment and protection product which not only strives to maximise your investment returns but also gives you an enhanced flexibility to suit it according to your protection needs, because we at Bharti AXA Life Insurance,believe that your hard earned money deserves nothing but the best. Now, be confident of choosing the best financial solution for your investment and life insurance needs. Be Life Confident.

Key Benefits:

Convenient single premium product with policy benefit period till the age of 70.

Unique special additions starting from the end of 5th policy year and thereafter at the end of every 5 years till the maturity date.

3 investment fund options as per your investment preferences.

Basic Sum Assured of five times the single premium.

Unique option of investing additional amount at your convenience through Top Up Premiums.

Flexibility of partial withdrawals after the third Policy Year

Additional benefit of Rs.5,00,000 in the event of death due to an accident.

Tax benefits under section 80C and 10(10D) of Income Tax Act.

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1.INTRODUCTION
In the business world investment is made in machinery, equipment and services. Quite naturally time and money is spent ensuring that they provide what their suppliers claim. In other words the performance is constantly appraised against the results expected. When it comes to one of the most expensive resources companies invest in, namely people, the job appraising performance against results is often carried out with the same objectivity. Each individual has a role to play and management has to ensure that the individuals objectives translate into overall corporate objectives of the company. Performance Management includes the performance appraisal process which in turn helps identifying the training needs and provides a direction for career and succession planning.

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Understanding Performance Management

PERFORMANCE MANAGEMENT

CORPORATE GOALS

DETERMINE INDIVIDUAL OBJECTIVES LINKED TO CORPORATE GOALS ENSURE RESPONSIBILITY AND ACCOUNTABILITY

PERFORMANCE APPRAISAL

PERFORMANCE LINKED INCREMENTS/ INCENTIVES/ REWARDS

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1.2 What is Performance?

Performance is synonymous with behaviour; it is what people actually do. Performance includes those actions that are relevant to the organizational growth and can be measured in terms of each individuals proficiency (level of contribution). Effectiveness Performance refers to the evaluation of results of performance that is beyond the influence or control of the individual.

1.3 How is Performance managed?

Good performance by the employees creates a culture of excellence, which benefits the organization in the long run. The activity includes evaluation of jobs and people both, managing gender bias, career planning, and devising methods of employee satisfaction etc. the efforts are to make to generate the individuals aspirations with the objectives of the organization. Organization has to clear the way of career advancements for talented and hardworking people. Fear of any kind from the minds of the employees should be removed so that they give best to their organization. Allow free flow of information. Communication network should be designed in such a way no one should be allowed to become a hurdle. This enables the managers to take correct decisions and that too quickly.

1.4 Why Performance Appraisal?????

Todays working climate demands a great deal of commitment and effort from employees, who in turn naturally expect a great deal more from their employers. Performance appraisal is designed to maximize effectiveness by bringing participation to more individual level in that it provides a forum for consultation about standards of work, potential, aspirations and concerns. It is an opportunity for employees to have significantly greater influence upon the quality of their working lives. In these times of emphasis on quality, there is a natural equation: better quality goods and services from employees who enjoy better quality goods and services from their employers. Performance appraisal must be seen as an intrinsic part of a managers responsibility and not an unwelcome and time-consuming addition to them. It is about improving performance and ultimate effectiveness. 25 | P a g e

Performance appraisal is a systematic means of ensuring that managers and their staff meet regularly to discuss post and present performance issues and to agree what future is appropriate on both sides. This meeting should be based on clear and mutual understanding of the job in question and the standards and outcomes, which are a part of it. In normal circumstances, employees should be appraised by their immediate managers on one to one basis. Often the distinction between performance and appraising is not made. Assessment concerns itself only with the past and the present. The staff is being appraised when they are encouraged to look ahead to improve effectiveness, utilize strengths, redress weaknesses and examine how potentials and aspirations should match up. It should also be understood that pushing a previously prepared report across and desk cursorily inviting comments, and expecting it to be neatly signed by the employee is not appraisal - this is merely a form filling exercise which achieves little in terms of giving staff any positive guidance and motivation. THE APPRAISAL OF PERFORMANCE SHOULD BE GEARED TO:

Improving the ability of the jobholder; Identifying obstacles which are restricting performance Agreeing a plan of action, that will lead to improved performance. It is widely accepted that the most important factor in organization effectiveness is the effectiveness of the individuals who make up the organization. If every individual in the organization becomes more effective, then the organization itself will become more effective. The task of reviewing situations and improving individual performance must therefore be a key task for all managers. For appraisal to be effective, which means producing results for the company, each manager has to develop and apply the skills of appraisal These are: -

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 Setting standards on the performance required, which will contribute to the achievement of specific objectives Monitoring performance in a cost effective manner, to ensure that previously agreed performance standards are actually being achieved on an ongoing basis Analyzing any differences between the actual performance and the required performance to establish the real cause of a shortfall rather than assume the fault to be in the jot holder. Interviewing having a discussion with the jobholder to verify the true cause of a shortfall, a developing a plan of action, which will provide the performance, required Appraisal can then become a way of life, not concerned simply with the regulation of rewards and the identification of potential, but concerned with improving the performance of the company. The benefits of appraisal in these terms are immediate and accrue to the appraising manager, the subordinate manager/employee, and to the company as a whole

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2.RESEARCH AND SURVEY:

Statement of the Problem:
Performance appraisal is a process of assessing, summarizing and developing the work performance of an employee. In order to be effective and constructive, the performance manager should make every effort to obtain as much objective information about the employee's performance as possible. Low performance can push the organization back in todays tough competition scenario. The project is aimed at analyzing the performance appraisal in companies.

Objective:

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The various objectives of our research are as follows: To examine why an appraisal system is important. To study existing appraisal system in various organizations across sectors like BPO, IT & Telecom. To find the expectation of appraiser and appraisee To determine the satisfaction level of the appraisee To reveal the various loopholes in the appraisal system if any To find the consequences of an inappropriately conducted appraisal system

Research Methodology:
The data source: Primary as well as Secondary. The research approach: Survey Method. The research instrument: Questionnaire. The respondents: The Managers & Employees of various organizations. The primary data was collected with the help of survey information. A concise questionnaire was prepared keeping in mind the information specifications.

3.RESULTS
Findings from Appraisee Survey
1. Expectations from Appraisal System :

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Respondents were asked to rank the various options according to their preference. (Rank 1 being most preferred and rank 6 being least preferred). Then scoring was given on the basis of ranks. 1 mark was allotted to rank 1, 2 marks for rank 2 and so on. Particular Salary Administration and Benefits Determination of promotion or transfer Assistance in goal Guideline for training plan An insight into your strengths and weakness Decision to layoff Score 87 109 228 254 312 354 Overall Rank 1 2 3 4 5 6

From the above table it can be seen that employees expect Salary Administration and Benefits to be the main reason for conducting a Performance Appraisal. Decision to layoff is of least importance as per the appraisee. 2. Awareness about Responsibilities :

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From the graph it can be seen that majority of employees are aware about their responsibilities, which implies that the appraisers have efficiently communicated to the appraisees all the parameters that will be taken into account during appraisal.

3. Satisfaction Level among appraise regarding Appraisal System :

From graph it can be seen that majority of the respondents are satisfied with the appraisal system. Only a meager 30% were dissatisfied with the Performance Appraisal programs.

4. Awareness about performance ratings :

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This clearly shows that majority of the employees are not aware about the performance ratings that are taken into account while conducting a performance appraisal.

5. Alowing Self ratings :

From graph it can be seen that majority of respondents want self rating to be a method of conducting the appraisals . 6. Chance to rate your own performance

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From the graph we can see that majority of the employees are not given a chance to rate their own performance in the organization. 7. Timing of Appraisals

This shows that most of the organisations conduct their Performance Appraisal programs annually. A very small percentage of the organisations conduct Performance Appraisals on a half yearly basis. The share of the quarterly and monthly appraisals are extremely minimal. 8. Credibility of Appraiser

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This shows that according to the employees/appraisees the credibility of the appraiser is extremely important and it has an effect on the overall Performance appraisal program.

9. Complaint channel for employees

This shows that there is no proper complaint channel existing in the organisations for the employees who are dissatisfied with the performance appraisal system.

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From this it can be seen that there is a clear majority among the employees who say that the standards on the basis of which the performance appraisal is carried out is not communicated to the employees before hand. 11. Performance Appraisal

Almost all the Performance Appraisals are carried our by the Immediate Supervisor in these organisations. In very few organisations, Rating committees carry out the performance appraisals. None of the organisations use Peer Appraisals, Appraisals by subordinates and Self rating as a method of Performance Appraisal. 12. Clear understanding of Appraisees job 35 | P a g e

This shows that the performance Appraisal programs are successful in giving a clear understanding of the appraisees job to both appraiser and appraisee.

13. Objectives of Appraisal System

From the figure we can derive that the objective for conducting the Appraisal system is clear only to half of the employees. The remaining half are not clear about the objective for which the Performance Appraisal is carried out.

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14. Good communication between top management and business goals

This shows that the appraisal systems do not provide a good communication flow of the top-management plans and business goals to the staff below. 15. Comments and suggestions to be considered

Almost all the employees expect that their comments and suggestions should be taken into consideration while conducting the Performance Appraisal.

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16. Post Appraisal interview

As per the response from the employees we can see that there is no interview conducted after the appraisal program for majority of the employees.

Findings from Appraiser Survey

1. Purpose of Appraisal

Respondents were asked to rank the various options according to their preference. (Rank 1 being most preferred and rank 6 being least preferred). Then scoring was done on basis of these ranks. 1 mark was allotted to rank 1, 2 marks for rank 2 and so 38 | P a g e

on. Then the total score for each purpose was calculated and overall ranking was given. Particular Determination of promotion or transfer Salary Administration and Benefits Decision to layoff Guideline for training plan Assistance in goal An insight into your strengths and weakness Score 24 27 42 69 72 81 Overall Rank 1 2 3 4 5 6

From table it can be seen that appraiser considers Determination of promotion or transfer & Salary administration and Benefits as two important factors for conducting an Appraisal. 2. Appraisal System

In this question appraiser was asked to rate how helpful the appraisal system is, from the graph it can be seen that majority of appraisers have rated 5,4 & 3 which implies that Performance Appraisal system is very helpful in Planning their work. Also most of the appraisers are satisfied with the appraisal system.

3. Support from subordinate

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This question was asked to find out how helpful appraisal system is in communicating the support that apprasier needs from appraisee. From results it is seen that the performance appraisal system is very helpful in communicating the support and help needed by the appraiser from the appraisee. 4. Type of Appraisal System

From results its clear that majority of companies prefer to use 360 degree feedback system for Performance Appraisal. As 360 degree feedback gives feedback of appraisee from everyone interacting with him, it is more reliable and hence most preferred. 5. Performance Appraisal criteria

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From results we can see that Qualitative Process is considered as the most important criteria for which the Performance appraisal programs are carried out, which shows that companies consider Qualitiy of product & service and Customer satisfaction as most important factors.

6. Timing of Appraisals

From graphs we can see that most of companies conduct appraisals on annual basis. Some companies conduct quaterly also. 7. Effect of poor Appraisal System

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It can be seen from results that most of the employees get De-motivated because of a poorly conducted appraisal. To some extent employees dont coordinate with their team members. Thus resulting in reduction of output.

8. Communication between top management and staff

All appraisers totally agree that performance appraisal helps in communicating the top management plans and business goals to staff at lower level. 9. Insight to Apprasiees strength and weakness

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It is evident from the results that performance appraisal system doesnt help the appraiser in understanding strength and weakness of apraisee.

10. Appraisees comment and suggestion

From the results it can be seen that appraisees comments and suggestion are not taken into consideration before Performance Appraisal. Performance Appraisal system is designed by appraiser without consulting appraisee.

11. Performance Appraisal

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It is evident from the results that performance appraisal is conducted by the Immediate Supervisor in all the companies.

12. Understanding of Apprasiees Job

From this it is clearly seen that according to appraiser there is a clear and joint understanding of the appraisees job.

13. Standards for Performance Appraisal

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From results it is evident that Performance appraisal standards are very well communicated to Appraisee before the Appraisal is carried out.

14. Self rating in Performance Appraisal

From results it can be clearly seen that the Appraisee is not given a chance to rate his own performance.

15. Action after Performance Appraisal 45 | P a g e

This shows that most of the companies act upon the results of their Performance Appraisal program.

4.FINDINGS AND RECOMMENDATIONS

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 From the survey results its evident that both the appraisees and appraisers expectation from Performance appraisal system are the same i.e. Determination of Promotion or Transfer and Salary Administration and Benefits. Hence a single performance appraisal system can satisfy needs of both the Appraiser and appraisee. Therefore the Performance appraisal program would be designed in such a way that the appraiser would be able to analyse the contribution of the employee to the orgaisation periodically and all the employees who have been performing well would be rewarded suitably either by an increase in the salary or a promotion. Through this the appraiser can also motivate the employees who felt that they had no growth in the organisation and serves the purpose of employee development.Thus performance appraisals can be used as a significant tool fo career lanning. Analyzing ones own strengths and weaknesses is the best way of identifying the potentials available, rather than the other person telling. Self-appraisal is a tool to analyze oneself. One of the most important findings was that almost all the employees wanted self-rating to be a part of performance appraisal program carried out by the organisation. From the responses of the appraiser we can also see that Self rating is not encouraged by the organisations. This could therefore be an important factor which leads to dissatisfaction among the appraisees. At the end of the year of the appraisal period the appraisal process should begin with self-appraisal by every employee. To appraise ones own self on key performing targets and qualities, the appraisee would go through a process of reflection and review. It is an established fact that change is faster when it is self initiated. If any employee has to improve or do better, he must first feel the need to do so. Reflection and review is a process that enables him to feel the need and improve more upon his strengths and weaknesses

Another point to be noticed is that even in the other forms of Performance Appraisal also the employees expect that they should be given a chance to rate their own performance. This can allow the employee to analyze ones own 47 | P a g e

performance which gives new insights on how one is performing and what are the critical points where he has to put his best and improve upon

The existence of a proper complain channel was also of utmost importance to the appraisees. They should be given a chance to convey their greviences to the top management.

The appraisees also expect that their comments and suggestions should be taken in to account while conducting the appraisals. This expectation is not fulfilled as the appraisers do not take their comments and suggestions into consideration. Therefore they should look into this matter before it leads to dissatisfaction among the employees.

The results also indicate that the there is no communication of top management plans and business goal to the appraisee. The appraisers on the other hand feel that the goals and plans have been clearly communicated to the appraisees. Communication is very essential for any system to function efficiently. Therefore the appraisers should look into this matter and see to it that the goals and plans are communicated effectively.

The findings suggest that for success of Appraisal system the credibility of appraiser is of utmost importance.

As per the Appraiser, a poorly conducted appraisal system would lead to demotivation and ineffective teamwok which will result in inefficient functioning and low productivity in the organization. Therefore, if at all they feel there is dissatisfaction among the appraisees they should motivate them. Achievement, recogntion, invelvement, job satisfaction and development can motivate the employees to a large extent. Along with this satisfactory working conditions and appropraite awards also play an important role.

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 Also a majority of employees were satisfied with the current appraisal system although they requested for some changes.

Most of the employees were also not clear about the criteria on which ratings were given to each employee while conducting the performance appraisal. Instead of secrecy there should be openess. Because of lack of communication, employees may not know how they are rated. The standards by which employees think they are being judged are sometimes different from those their superiors actually use. Proper communication of these ratings can help the employers achieve the level of acceptability and commitment which is required from the employ.

From the survey we can also derive that the appraisees expect a post appraisal interview to be conducted wherein they are given a proper feedback on their performance and they can also put forward their complaints if any. The appraisal should also be followed up with a session of counseling which is often neglected in many organizations. Counseling involves helping an employee to identify his strengths and weaknesses to contribute to his growth and development. Purpose is to help an employee improve his performance level, maintain his morale, guide him to identify and develop his strong points, overcome his weak points, develop new capabilities to handle more responsibilities, identify his training needs.

5.CONCLUSION
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With rewards being directly linked to achievement of objectives, goal setting and Performance Appraisal assumes utmost importance. The Performance Appraisal System has been professionally designed and it is monitored by HRD. The implementation is the responsibility of each and every employee along with their supervisor. There should be adequate training to the evaluator that will go a long way in answering the quality of Performance Appraisal. In conclusion, a Performance Appraisal is a very important tool used to influence employees. A formal Performance review is important as it gives an opportunity to get an overall view of job performance and staff development. It encourages systematic and regular jointstocking and planning for the future. Good performance reviews therefore dont just summarize the past they help determine future performance.

6. Appendices
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Questions for Appraisee

Name: ___________________________ Contact No: __________________________
1. What do you expect from a Performance appraisal :

(Rank the options from 1 to 6; 1 being most preferred & 6 being least preferred)
Detail Salary Administration and Benefits Determination of promotion or transfer Decision on layoff Assistance in goal Guideline for training Plan An insight into your strengths and weakness Rank

2. Do you know what exactly is expected from you at work? a. Yes b. No

3. Are you satisfied with the appraisal system?

1 2 3 4 5 (1 = Least satisfied; 5 = Most satisfied)

4. Are you aware of performance ratings? a. Yes b. No

5. Do you think you should be given an opportunity to rate your own performance? a. Yes b. No

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6. Are you given a chance to rate your own performance? a. Yes b. No

7. Timing of Appraisals a. Monthly b. Quarterly c. Half Yearly d. Annual e. Anytime

8. Does the credibility of Appraiser affect the Performance Appraisal System? a. Yes b. No

9. Is there a complaint channel for the employees who are dissatisfied with the performance appraisal system? a. Yes b. No

10.Are the standards on the basis of which the performance appraisal is carried out communicated to the employees before hand? a. Yes b. No

11.Who conducts the performance appraisal? a. Immediate supervisor b. Peer appraisal c. Rating committees d. Self-rating e. Appraisal by subordinates

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12.Is the performance Appraisal successful in giving a clear understanding of the appraisees job to both appraiser and appraise? a. Yes b. No

Are the objectives of appraisal system clear to you? a. Yes b. No Does the appraisal system provide a good communication between the topmanagement plans and business goals to staff below? b. Yes b. No

13.Do you want your comments and suggestions to be taken into consideration during appraisal? a. Yes b. No

14.Is there a post appraisal interview conducted? a. Yes b. No

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Questions for Appraiser Name: ___________________________ Contact No: __________________________
1. Purpose of Performance appraisal :

(Rank the options from 1 to 6; 1 being main purpose & 6 being last purpose)
Detail Salary Administration and Benefits Retain performing employees Rank

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Determination of promotion or transfer Decision on layoff Assistance in goal Guideline for training Plan

Is the Performance Appraisal helping you to plan your work well?

1 2 3 4 5 (1 = Least helpful; 5 = Most helpful)

2. Does the system provide you a chance to communicate the support

you need from your subordinate to perform the job well.

a. Yes b. No

3. Which appraisal system is being employed in the company? a. Assessment centre b. MBO c. BARS d. 360 degree feedback e. Balance scorecard

4. Performance Appraisal criteria a. Quantitative outcome criteria (Sales volume, Sales price, Productivity, Goal accomplishment rate) b. Qualitative process criteria (Quality of product or service, Customer satisfaction) c. Quantitative process criteria (Efficiency, Cost/expenses, Attendance) d. Qualitative process criteria (Judgment, Work attitude, Leadership, Conduct /Trait)

5. Timing of Appraisals a. Monthly

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b. Quarterly c. Half Yearly d. Annual e. Anytime 6. What do you think is the effect of a poor appraisal system

a. De-motivation b. Retention c. Ineffective teamwork

Does the appraisal system provide a good communication between the topmanagement plans and business goals to staff below? d. Yes b. No Does it give insight to appraisee regarding his strength or weakness? e. Yes b. No

7. Are employees comments and suggestions taken into consideration

before the appraisal?

a. Yes b. No

8. Who conducts the performance appraisal a. Immediate supervisor b. Peer appraisal c. Rating committees d. Self-rating e. Appraisal by subordinates

9. Is the performance Appraisal successful in giving a clear understanding of the appraisees job to both appraiser and appraise? b. Yes b. No

10.Are the standards on the basis of which the performance appraisal is carried out communicated to the employees before hand? a. Yes b. No

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11.Do you give an opportunity to the appraisee to rate his own performance? a. Yes b. No

12.Do you act upon the results of your performance appraisal? a. Yes b. No

13.If yes, then mention the remedial measures taken?

7. BIBLIOGRAPHY
BOOKS Organizational Behavior by Steve Robbins The Art of HRD, Reward Management, Volume 9 by Micheal Armstrong and Helen Murlis Performance Management, Concepts, Practices and Strategies for Organisation success by S. K. Bhatia

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