PROJECT REPORT ON

STUDY

OF PERFORMANCE APPRAISAL PROCESS AS PRACTICED IN GLAXOSMITHKLINE PHARMACEUTICALS LIMITED

AT GLAXOSMITHKLINE PHARMACEUTICALS LIMITED, NASHIK

BY Mr. SONAL S. KHAJEKAR

IN THE PARTIAL FULFILMENT OF THE COURCE MBA [BIOTECHNOLOGY]

MITCON INSTITUTE OF MANAGEMENT BALEWADI , PUNE 411045.

2006-2007

EXECUTIVE SUMMARY
This project work is based on PERFORMANCE APPRAISAL, which is one of the most important and difficult managerial activities. It can be said that it is the process of assessing Qualitative & Quantitative aspects of an employees job performance. PERFORMANCE APPRAISAL serves as work planning and review function. The appraisal and subsequent-subordinate review provide an opportunity to review subordinates progress, provide person with feedback, and map out a plan for rectifying performance deficiencies that might be identified. So PERFORMANCE APPRAISAL process for managers in GSK was taken as topic of project. The subject matter of this project has been adopted by using a questionnaire based on which different points in this project were discussed & analyzed. Apart from this, to get the complete understanding & coverage of the topic different books & websites were referred. However, while adopting the relevant subject matter, the emphasis has been, on the study of Performance Appraisal process of the organization. The subject matter, observations, findings, & suggestions are supported by examples, figures, & tables wherever required. A systematic representation of the subject matter has been done in the following manner. Chapter 1- Presents the background of the topic. Chapter 2- Deals with the objective of the project topic. Chapter 3 Named as Review of literature gives detailed introduction of the topic Performance Appraisal & this chapter is also focus on the MBO-method used by GSK, Objective setting process of GSK. Chapter 4- Mentions the methodology of the research & gives the brief description of the project matter. 2

Chapter 5- Discusses the data presentation & analysis on the basis of the questionnaire. Chapter 6- Gives the findings (i.e. conclusions) of the points mentioned in the data presentation & analysis & the last chapter i.e. Chapter 7- Gives suggestion about the findings. The last part of the project report contains Annexure & Bibliography. Thus, a sincere effort has been made to complete this project.

AKNOWLEDGEMENT
It gives me immense pleasure to place on record my deep feelings of reverence and gratitude to Mr.V.R.Patil, Senior HR-Manager of GlaxoSmithKline, Nashik for giving me this opportunity to carry out my summer project in this esteemed organization. I also thank my external guide Mr. A.K.Lal, Asst. HR-Manager of GlaxoSmithKline, Nashik, for his untiring devotion, noble guidance, valuable suggestions and above all continuous encouragement, which has played an important role in the completion of this project. It is my earnest endeavor to express sincere thanks to Prof. Sanju Devis (Dean), Prof. Santosh Mahajan (Registrar) & Dr.V.Vedak (Director) of Mitcon Institute of Management (MIMA), other faculty members and staff members of MIMA for their kind co-operation which made me worthy of being able to pursue such a challenging project and complete it successfully. I am highly indebted to my internal guide, Prof. Chandrima Roy & Co-guide, Prof. Sudhakar Kanoji, who provided me with their valuable guidance throughout the project.

PLACE : DATE : SONAL S. KHAJEKAR (PGDBM-BT)

INDUSTRIAL PROFILE

PHARMACEUTICAL INDUSTRY- AN OVERVIEW

The Indian pharmaceutical industry is a success story providing employment for millions and ensuring that essential drugs at affordable prices are available to the vast population of this sub-continent.
Richard Gerster Today, the Indian Pharmaceutical industry is in the fore front of science-based industries of the country with wide ranging capabilities in the complex field of drug manufacture and technology. India ranks among top 15 drug manufacturing countries of the world and rates very high in the third world in terms of technology, quality and range of medicines manufactured. The country boasts of manufacturing almost every type of medicine from simple headache pills to sophisticated antibiotics and complex cardiac compounds.

The industry meets around 70 per cent of the country's demand for bulk drugs, drug intermediaries, pharmaceutical formulations, chemicals, tablets, capsules, orals and injectibles. The bulk drug industry in India has been growing at a phenomenal pace and several important drugs like Ampicilin, Amoxyclin, Cloxacilin, Atenoloi, Ranitidia, Lisinopril, Cephalosporin, Quinolones, anti-inflammatory drugs, Nifadipine, antiasthmatics, etc, have been produced in bulk. Growing at the rate of 14 per cent per year, the industry possesses 20,053 manufacturing units, of which 290 units are in the largescale sector and 58 Multi-National Companies (MNCs) have manufacturing bases. It provides employment to approximately 33 lakh people.

The organized sector of Pharmaceutical industry has played a key role in promoting and sustaining development in this vital field. International companies associated with this sector have stimulated, assisted and spearheaded this dynamic development in the past fifty four years and helped to put India on the world pharmaceutical map. The total production of bulk drugs in the country in 2000-2001 was Rs. 4533 corers, while formulations accounted for Rs. 18354 corers.India is largely self-sufficient in the case of formulations, as over 85 per cent of formulations are sold in the domestic market and only some life saving, new generation formulations continue to be imported, specially by MNCs.

Factors Aiding Growth

The Indian market has some unique advantages. India has a fifty four year old democracy. It has an educated work force and English is commonly used. It has a solid legal framework and strong financial markets. Professional services are easily available. It has a pool of personnel with high managerial and technical competence, as also skilled workforce. There is already an established international industry and business community. It has a good network of world-class educational institutions and established strength in Information Technology. The country's commitment to free market economy and globalization has given it an added advantage. Above all, it has a 70 million middle class market, which is continuously growing. The Pharmaceutical industry in India provides excellent facilities. It has quality producers and regulatory authorities in the United Slates of America and the United Kingdom approve many units. Its track record of development, particularly in the area of improved cost-beneficial chemical synthesis for various drug molecules, is excellent. It provides a wide variety of bulk drugs and exports sophisticated drugs

Factors Deterring Growth

The Pharmaceutical industry has been plagued by two main deterrents. One of them being price control and the other being taxation. Price control in a large number of industries has already been abolished. The Pharmaceutical industry in India is the only industry being subjected to a three-tier control, viz, item-by-item control on the prices of bulk drugs, product-wise control on the prices of formulations, and an overall control on the profitability of formulations. The first formal drug price control was introduced in 1979, effected under the Essential Commodities Act. Since then there have been two price revisions, the first being in 1987 and the second in 1995. Administrative and rigid price control has certainly retarded the development of this essential industry. Medicines bear a heavy burden of taxes. Today, almost every pharmaceutical product is being taxed to the extent of 30-35 per cent through custom duty, excise, sales tax, octroi and other taxes. The burden on the consumer keeps rising year by year. In a way, the tax on medicine is a tax on sickness.

Opportunities for International Companies

For the first time in many years, the international pharmaceutical industry is finding great opportunities in India. The process of consolidation, which has become a generalized phenomenon in the world pharmaceutical industry, with its rich scientific talents and research capabilities, supported by Intellectual Property Protection regime, is well set to mark its place as a Sunrise Industry.

Exports
India is a net exporter of bulk drugs as over 50 per cent of bulk drug production is exported. During the year 2000-2001, the total value of bulk drugs and pharmaceuticals produced in India was worth US $ 1230 million, out of which drugs worth US $ 840 million were exported.

The export of bulk drugs are projected to be around US $ 1350 million which indicates more than 100 per cent growth by the year 2000-2003 in this sector.

10

COMPANY PROFILE

NASHIK FORMULATION PLANT

11

Nashik town possesses the largest manufacturing plant of GlaxoSmithKline Co. in India. In terms of its volume it is considered to be one of Asias largest plant. This plant is also termed as one of the fastest growing plants in India. Situated in the Ambad Industrial Area this plant is erected on an area of 23 acres equal amount of land is available for further expansion of the plant. Location advantage of Nashik is that it is only 180 KM from financial capital of India that is Mumbai. Nashik is situated 600 meters above sea land. Nashik is one of the fastest growing cities in India. It has good infrastructure and enjoys facilities like power, water, transportation and telecommunication facilities. In this plant more than 50 products are manufactured. There are different sections like tablets, liquids, ointments, aerosol, dry inject able powders and liquid ampoules which produce different types of products. Nashik factory is built to international standards manufacturing facility of each dosage form is constricted as a separate module adopting the best

12

prevailing practice in the world of technology. The factory is geared for production of large volumes of a wide variety of effective remedies. The key products include anti ulcer ant, Zinetic tablets, third generation antibiotic, fortum Aerosol containing respiratory drug salbutamol and anti inflammatory, Beclometharone. Today the factory produces 140 billion packs per year as against 30 million parks 8 years ago. The factory now looks forward to fully utilize its production potential; the site exports its products to various countries.

There are various efforts continuously carried out in the plant in order to reduce waste, increase productivity, cost saving measures controlling and minimizing the use of utilities so as to save power, water etc. There are in all 42 products in 75 packs manufactured at Nashik.

13

MISSION STATEMENT OF GSK OUR GLOBAL QUEST IS TO IMPROVE THE QUALITY OF HUMAN LIFE BY ENABLING PEOPLE TO DO MORE, FEEL BETTER AND LIVE LONGER. GOALS OF GSK
To delight customers through continuous improvement To provide superior returns to our shareholders To uphold leadership in selected disease areas and increase overall market share To build a learning organization To endow with an environment for excellence.

EHS POLICY OF GSK:

GSK pharmaceuticals limited, India is committed to high standards of environment, safety and health management as an integral part of business activities, in line with corporate values and continuous improvement. GlaxoSmithKline Pharmaceuticals Ltd, Indias guiding principle is all accidents are preventable and all identified Health risks are containable.

14

PRODUCT RANGE :
LIQUIDS:
Vitamin preparation Couge preparation Sulpha drug Complex B Glaxo liquid . Ostacalcium Piriton expectorant Dilosyn Septra suspension

OINTMENT:
Cream Oimtments Highly potent drug Beta ovate range of products:E.g.:- plain ,C,N,M,G etc. Anovate, Betnovate-S, Neosporin. Flutivate cream/ Ointment, T-Bact.

TABLETS:
Beta products Anti-ulcerate Betnosol tablets/ Betnosol forte Tablets, Betnalan tablets. Zintac tablets.

AEROSOLS:
Asthma preparation Venorlin inhaler. Becoride range of products.

DRY VIALS:
Third generation Antibiotics Supacef Injection. Fortum Injection. Cefidox Injection Vitneurin . Mecraberin Injection

15

GlaxoSmithKline Pharmaceuticals Ltd.

General information :
Annual turnover of the year- 2005-06 were approximately 1400 corers

Total Manpower

Departments
1. Production 2. Engineering 3. Quality Assurance 4. Crche 5. Lennon 6. Stores 7. O.H.C. 8. Office staff 9. Managerial staff

No. of Employees
484 70 36 02 05 10 08 28 94

Shifts :
General :First Second ::8 : 00 am to 5 : 30 pm 6 : 15 am to 3 : 00 pm 3 : 15 pm to 12 : 00 am

16

SR GENERAL MANAGER

Sr. Manufacturi ng Manager

Sr. Eng Manager

Sr. Human Resource Manager

Sr. Quality Assurance Manager

ORGANISATION CHART

Manufacturi ng Manager Training & documentati on Manager Accounts manager Stores manager

Eng Manager

Quality Assu Manager

EHS Manager

Asst Mfg Manager Asst. Quality ass Manager Asst T&D manager Accounts Executiv e

Asst Eng Manager

Asst.. Human Resource Manager Asst stores Mgr

Asst Procure

Asst Distrib

17

Mfg Executive QA Executive

Eng Executive

Stores Executiv e

EHS Executive

General operative Clerk

Clerk Skille Staff Clerk

Clerk

Skilled Staff

Clerk

Attendant Attendant

Attendant

Attendant

TABLE OF CONTENT INDEX

CHAPTER NO. 1. TOPIC
RESARCH PROBLEM AND ITS BACKGROUND

PAGE NO.

18

19

CHAPTER 1

RESARCH PROBLEM AND ITS BACKGROUND

RESEARCH PROBLEM & ITS BACKGROUND

This project work is based on Performance Appraisal which is one of the most important and difficult managerial activities. It can be said that it is the process of assessing Qualitative & Quantitative aspects of an employee job performance. Most organization have a formal performance appraisal programme.This holds true for large and small union & non-union, and manufacturing and non manufacturing companies .Most employee involve in these programs as well with production ,office/clerical,professional/technical,first level supervision,middle,even top management included. 20

It is important to realize that Performance Appraisal will probably always reflect an element of managerial discretion, and that such discretion is not necessarily bad. Limited discretion, exercised by trained and responsible evaluators, will help to keep the system flexible, responsive and accurate. Finally, Performance Appraisal is based on the faith of the employee on performance appraisal process of their organization, also based on the perception of employee about the Performance Appraisal process of the organization. Therefore for effective working of performance appraisal process there is needed to verify the perception of the employee. So the study of study the perception of the managers of GSK was taken as a research problem. The perception of the manager is taken because GSK carryout performance appraisal process only for the managers.

21

CHAPTER 2
OBJECTIVES AND SCOPE

OBJECTIVES:
The objectives of this project was 1. To study the Performance Appraisal process as practiced in GSK. 2. To study the perception of the managers of GSK about the Performance Appraisal Process as practiced in GSK

SCOPE OF THE PROJECT:

1. Appraisal in any organization is important as appraisals provide information upon which promotions and salary decisions can be made.

22

2. Appraisals also provide an opportunity for the senior and subordinate to review the subordinates work related behavior. 3. Appraisal helps to determine the individual training and development needs of the employees for a better and improved performance or handle greater responsibilities. 4. Performance appraisal also tends to be extremely helpful in tough decisions about promotion, transfer, demotion, salary hike, retention, etc. 5. It will help GSK for motivating the employees. 6. It will help GSK to formulate a better performance appraisal process

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CHAPTER 3
RESEARCH METHODOLOGY

RESEARCH METHODOLOGY
Research methodology is a way to systematically solve the research problem. It may be understood as the science of studying how research is done. In it one studies the various steps that are generally adopted by a researcher in studying his/her research problem along with the logic behind it. It shows the type of sample design used and the size the producer has used to draw the sample. The extent of precision achieved and the method used for handling any special problem during the course of the study. The methods used by me were the questionnaire method and the interview method to collect the data and analyze the Performance Appraisal process in GlaxoSmithKline pharmaceuticals limited, Nashik. 24

RESEARCH DESIGN;
Research Design is a plan, structure and strategy of investigation conceived so as to obtain answers to research questions and to control variance. There are three types of research designs. Exploratory Research Descriptive Research Casual Research

Among the above-mentioned types, Descriptive Research was used.

DESCRIPTIVE RESEARCH:
Descriptive research describes a behavior or condition. The data are collected using questionnaires, observations, and interviews .It is also called Quantitative Research. Generally these data are generally analyzed using Percentages,Chi Square etc.

In this project report, the data is collected from sources like

SOURCES OF DATA:
Data sources are the data used from sources to carry out a research or collecting fresh data to obtain results. There are two types of data sources: 1. Primary Data 2. Secondary Data

25

In this my project the researchers have used both Primary data as well as Secondary data.

PRIMARY DATA:
Data collected by the researcher specifically for the research project. It is collected directly from people and organizations via. Questionnaire or Surveys before being analyzed to reach conclusions concerning the issues covered in the questionnaire or survey. New data gathered to help and solve the problem at hand. As compared to secondary data which is previously gathered data. An example is information gathered by a questionnaire.

Primary source includes:

Interview: It is best method to collect the data as it actually involve a face-to-face interaction. Questionnaire: It includes the opinion of the employee related to Performance Appraisal and training provided.

SECONDARY DATA:
Secondary data is a data that has been gathered for some other purposes. Data obtained indirectly from sources such as book or computer database. Data that have already been collected for some purpose other than the current study. Those that have been gathered for purposes other addressing the issue or problem currently under study.

Secondary source includes:

Reference books: Every research study has its theoretical and practical part. Theory part is usually compiled by reference of various books on concern topic. 26

Company records: During the course of the investigation the researcher went through the company records which are relevant to the performance of the managers such as non confidential category records, objectives setting forms, the personal files of the managers, trainee managers etc.

GSK news

SAMPLING DESIGN AND SAMPLE SIZE

Once the researcher has formulated the problem and developed a research design including the questionnaire, he/she has to decide whether the information is to be collected from all the people comprising the population. .Purposive sampling a type of Non probability sampling method was used for this project. .

SAMPLE SIZE :-

25-35

ANALYSIS OF COLLECTED DATA

Researcher has made use of graphs showing percentages to represent some questions. Each question was analyzed and interpreted to arrive at a logical conclusion. The graphical representation was to make the analysis easy to interpret. For each question, tabular or graphical mode of representation has been used.

PREPARING THE RESEARCH REPORT

27

Researcher has prepared his research report according to the principles prescribed by the Institute. He has tried best to maintain objectivity, clarity in the presentation of ideas and the use of charts and diagrams. The essence of a good research report is that, it effectively communicates its research findings and to a great extent, Researcher has tried to maintain this objective while compiling his project.

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CHAPTER 4
REVIEW OF LITERATURE

I NTRODUCTION TO PERFORMANCE APPRAISAL:

Performance Appraisal is considered as a most significant and indispensable tool for an organization, for the information it provides is highly useful in making decisions regarding various personal aspects such as promotions and merit increases. Performance measures also link information gathering and decision making processes which provide a basis for judging the effectiveness of personnel. If valid performance data is available, timely, accurate, objective, standardize and relevant, management can maintain consistent promotion and compensation policies throughout the organization. Formal performance appraisal plans are designed to meet three needs, one of the organization and other two of individual.

29

1. They provide systematic judgments to back up salary increases, transfers, demotions or terminations. 2. They are means of telling a subordinate how he is doing, and suggesting needed changes in his behavior attitudes, skills, or job knowledge. They let him know where he stands with the boss. 3. The superior uses them as a base for training and developing the individual.

What is Performance Appraisal? Performance Appraisal is an objective assessment of an individuals performance against well-defined benchmarks. It is the systematic Evaluation of the Individual with respect to his or her performance on the job & his / her potential for development.

A more comprehensive definition is:

Performance Appraisal is a formal, structured system of measuring and evaluating an employees job related behaviors and outcomes to discover how and why the employee is presently performing on the job and how the employee can perform more effectively in the future so that the employee, organization, and society all benefit

Methods Of Appraisal:
Several methods and techniques of appraisal are available for measurement of performance of an employee. Each of the methods discussed could be effective for some purposes, for some organizations. The methods and scales differ, 1. In the source of traits or qualities to be appraised because of difference in Job requirements, statistical requirement and the opinion of the management. 2. Because of the different kinds of workers who are being rated. 3. By the degree of precision attempted in an evaluation. 4. Because of the methods used to obtain weightings for various traits.

30

The widely used categorization is that given by Strauss and Sayles.They have classified Performance Appraisal methods into traditional and modern methods.

METHODS OF PERFORMANCE APPRAISAL

Traditional methods
Rating Scales Checklist Forced choice Method Forced Distribution Method Critical Incidents Method

Modern methods
Assessment Center Management By Objectives (MBO) Behaviorally Anchored Rating Scales 3600 Performance Appraisal Field Review Method Essay Method

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

Checklist method: 31

In this method a checklist of statement on the traits of the employee and his or her job is prepared in two columns yes and no. Here the rater has to tick yes column if the answer is positive and the no column if the answer is negative. After ticking of f against each statement the rater forward the list to the HR department. The HR dept. assigns certain points to each yes tick. When points are allotted to the checklist the technique becomes a Weighted Checklist. Actual evaluation is done by the HR dept.

Forced choice method: This approach is known as the forced choice method because the rater is forced to select the statements, which are readymade. The advantage of this method is the absence of personal bias in rating. The disadvantage is that the statements may not be properly framed- they may not be precisely descriptive of the ratees traits.

Forced distribution method: The forced distribution method operates under an assumption that employee performance level conforms to a normal statistical distribution. This system is used to minimize or eliminate raters bias so that all personal may not be placed at the higher end or at the lower end of the scale. It requires the rater to appraise an employee according to the predetermined distribution scale. Under this system, it is assumed that it is possible and desirable to rate only 2 factors visualizing job performance and promotability.

Critical incidents methods: In this method, the subordinates are observed during their work whenever some critical incidents occurred during the job (this critical incidents are the important occasions identified by the supervisors in the job) the behavior of the employees during this incidents is appraised and based on the performance in this incidents, the subordinates are evaluated.

32

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

Essay method: Essay method is extremely useful in filing information gaps about the employees that often occur in the better structure checklist method

MODERN METHODS :360-Degree Feedback: The technique, in which multiple raters ranging from an employee, from supervisors, subordinates, peers, and, internal and external customers are involved in evaluating performance of an individual, is called 360-degree feedback method. This technique is understood as systematic collection of performance data on an individual or group, derived from a number of raters.

33

Assessment center: An assessment center is a central location where managers may come together to have their participation in job related exercises evaluated trained observers. Mostly used for executive hiring, assessment centers are now being used for evaluating executive or supervisory potential.

Behaviorally Anchored Rating Scales: BARS are said to be behaviorally anchored as the scales represent a range of descriptive statements of behavior varying from the least to the most effective. These are the rating scales whose scale points are determined by statements of effective and ineffective behaviors. A rater is expected to indicate which behavior on each scale best describes an employees performance.

DATA PRESENTATION
The Method used in GlaxoSmithKline pharmaceuticals Ltd. is based on --

Management By Objectives
It was Peter F.Drucker who first gave the concept in 1954. MBO reflects a management philosophy, which values and utilizes employee contributions. MBO has been defined as: 1. A system approach to managing and organization, where those accountable for directing the organization first determine where they want to take the organization.

34

2. A process requiring and encouraging all key management personnel to contribute their maximum to achieving the overall objectives. 3. An effort to blend and balance all the objectives of all key personnel, and 4. An evaluation mechanism. Objectives: 1. The objective is to change behavior and attitudes towards getting the job done. 2. MBO is result oriented; it is performance that counts. 3. Stress the objectives rather than methods. 4. It provides responsibility and accountability and recognizes that employees have needs for achievement and self-fulfillment. It meets these needs by providing opportunities for participation in goal setting process. 5. Subordinate become involved in planning his or her own careers.

Process:
Four steps in MBO process 1. Establish organization objectives to establish objectives for each employee for the given period. The objective typically refers to the desired outcome to be achieved. These objectives can then used to evaluate employee performance. 2. Setting the performance standard involves setting the performance standards for the subordinates in a previously arranged time period. As subordinates perform, they know fairly well what there is to do, what has been done and what remains to be done. 3. Performance reviews the actual level of goal attainment is compared with the objectives agreed upon. The evaluator explores reasons for the objectives that were not met, and for their objectives that were exceeded. This step helps to determine possible training needs. It also alerts the superior to conditions in the organization that may affect a subordinate. 4. Feedback the employees who receive frequent feedback in time which are specific and relevant, concerning their performance are highly motivated than those who do not.

35

5. Establishing new objectives involves establishing new objectives and, possibly, new strategies for objectives not previously attained. At this point, subordinate and superior involvement in objective setting may change. Employees who successfully reach the established objectives may be allowed to participate more in objective setting process the next time. The process is repeated.

Advantages: MBO is an important performance tool. It has certain advantages. 1. MBO helps and increases employee motivation because it relates overall objectives of the company to that of individual objectives, and helps the employee to understand where he stands in the organization. 2. Managers will assess themselves, rather than compete with other managers, which helps to reduce internal conflicts. 3. MBO results in a means ends chain. Management at succeeding lower levels in the organization established targets, which are integrated with those at the next higher level. Thus, it can help insure that everyones activity is ultimately aimed towards organizations goals. 4. 5. 6. 7. 8. MBO reduces role conflict and ambiguity since, MBO aims at providing clear MBO provides more objective appraisal criteria, for evaluating the managers MBO forces and aids in planning, to establish a strategy and goals for entire Frequent performance reviews help to identify problems better and early. MBO identifies performance deficiencies and enables the management to take targets and their order or priority, and it reduces both these situations. performance. organization and how to reach them.

decisions related to training and development of employee.

Disadvantages:
36

1. MBO is time and energy consuming. 2. MBO is not applicable to all jobs in all organizations. 3. There is sometimes a tug-of-war in which the subordinate tries to set the lowest targets possible and the supervisor the highest.

OBJECTIVE SETTING PROCESS

Definition:
Objective setting process is the initial phase of performance management system that involves setting of specific- measurable- agreed- realistic- time related (SMART), Key result areas and proper appraisal system to trap bias free information. Meaning: Objective setting is a part of Performance Management System. It focuses on the notion that employees efforts should be goal directed. There are two aspects of this: 1. The manager should appraise the employees based on how that employee performed with respect to achieving the specific standards by which the employee expected to be measured.

37

2. The employees goals and performance standards should make sense in terms of companys strategic goals. Purpose: Employee should know his yearly targets so that he can work accordingly towards accomplishment of these targets. For drawing conclusions/ rating employees performance at the end of the year for taking decisions on incentives and promotion. Employees individual targets should make pillars for accomplishment of overall organization missions.

In GlaxoSmithKine, the Top-Down approach is followed.

In top down approach, the top management sets the organizational goals. These goals thereon assigned to all the levels TOP DOWN APPROACH of the organization. The top management set the departmental goals according to that it percolates down to the lower level in the organization.

Top

38

Management

Nashik Unit

Functional Manager

Employee

TOP DOWN APPROACH

Objective setting process in GSK pharmaceuticals Ltd Objective setting for the newly joint employees is done after one month of Date of joining and for existing employees it is done annually after the appraisal. 1. The objective setting form is available online in GSK for the respective managers. 2. The managers and the employee come together for a formal discussion and the objectives are set participative. 3. The manager give an introduction about the organizational goals/ mission, job profile and explains the whole process to the employee. 4. The objectives, which have to be set, are discussed between the managers and the employee in consideration to Key Performance Areas and behavioral attributes. KPAs are aligned with the departmental goals. 5. The final objectives are set according to SMART goals.

39

SMART goals :S Specific- written in simple language and to the point.

M Measurable- must be easy to measure and evaluate. A Agreed- agreed between the managers and the employee. R Realistic- capable of being met by the employee given the circumstances T Time Related- goals should be time bound. Goals lack significant incentive power if they are unrelated to the organizations underlying personal aspirations. 6. The behavioral and attitude objectives cannot be based on SMART goals, as they cannot be measured. 7. The employee studies the final objectives set and if he finds any difficulty in achieving the targets, his training need is identified. 8. The objectives set is agreed by both of them are finally documented on the online objective setting form and approved by the manager and the employee. 9. The objective setting form is finally filled online. 10. Copy of objective setting form has to be retained with the manager, the employee and HR department for final review.

CHAPTER 5
40

DATA PRESENTATION AND ANALYSIS

Data Analysis
Q.1. What you say about objective setting procedure in PA? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE Relevant According to business goals Not satisfied 9 21 0 30% 70% 0%

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TOTAL
FEQUENCY

30

100%

0%

30% Relevant According to business goals Not satisfied

70%

Q.2. Whether objectives are written by you or by your boss? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE
FREQUENCY

By both
10% By boss

18 9 3 30
60%

60% 30%
By both

By self
30% TOTAL

10% 100%

By boss By self

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Q.3. Do you feel that the objective setting procedure is to be Changed ? Sr. no. 1 2 3
60%

DESCRIPTION FREQUENCY PERCENTAGE No change Somewhat Fully changed TOTAL

0%

FREQUENCY

12 18 0 30
40%

40% 60%
No change

0%

Somewhat 100% Fully changed

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Q.4. All the objectives of PA are clear to you ? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE Somewhat 9 FREQUENCY Not fully Fully TOTAL
60% 10%

30% 10% 60%

Somewhat Not fully Fully

3
30%

18 30

100%

44

Q.5. Are you satisfied with your speed of review towards Completion of target? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE Satisfied 18 FREQUENCY Not much Slightly TOTAL
20% 20%

60% 20% 20%

Satisfied Not much Slightly

6 6 30
60%

100%

45

Q.7. Which of following factors affect your performance? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE Health factors Family 0 0 0% 0% 100%
Health factors Family Profession

FREQUENCY

Profession TOTAL
0% 0%

30 30

100%

100%

46

Q.8. Performance review discussion is conducted with high Quality & care ? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE Correct 15 45% 45% 10% 100%
Correct 40% 50% Somewhat correct Incorrect

Somewhat 12 FREQUENCY correct Incorrect 3

10%

TOTAL

30

47

Q.9. Is HR-department provide inadequate feedback to the Line manager on their behaviors? Sr. no. 1 2 3 4 DESCRIPTION FREQUENCY PERCENTAGE Never Sometimes every time No response
30%

9
FREQUENCY

30% 30% 10% 30% 100% Never

Sometimes every time No response

9 3 9

TOTAL

30%

30

10% 30%

48

Q.10. Which type of benefits you gain through annual review ? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE Monetary Non monetary Both 12 3 40% 10% 50% 100%
Monetary

FREQUENCY 15

TOTAL

30
40%

Non monetary Both

50% 10%

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Q.11. Are you satisfied with your score of this year ? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE Fully Partially 12
FREQUENCY

40% 50% 10% 100%

Fully Partially Not satisfied

15 3 30

Not satisfied
10% TOTAL

40%

50%

50

Q.12. At which stage your objective lye at the annual review ? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE Successfully completed exceeds 21 9 0 30
exceeds Not completed

70% 30% 0% 100%

Successfully completed

Not completed TOTAL

0% 30%

FREQUENCY

70%

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Q.13. Is individual performance based on effective Implementation of PA-system? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE Yes No Cant say TOTAL
FREQUENCY

7 5

23.35% 16.75% 60%

Yes No Cant say

23%

18 30

100%

60%

17%

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Q.14. Is effective PA- system is important factor for Improving individuals performance? Sr. no. 1 2 3 DESCRIPTION FREQUENCY PERCENTAGE Important 8 26.70% 33.30% 40% 100%
Important Not important Cant say

Not important 10 FREQUENCY Cant say TOTAL

40%

12 30 27%

33%

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CHAPTER 6

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FINDINGS AND CONCLUSIONS

. Findings: 1. The Objective setting process is done for all the managers. 2. The objectives are set according to the Key Performance Area with the application of SMART Goals. 3. Performance appraisal is done annually. 4. MBO method is used for Performance management system. 5. The employee has full right to comment on the appraisal interview.

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CONCLUSIONS: During my interaction with GSK group Nashik relating to my project I found a friendly and stress less environments where management and staff frequently interacted with each other The goal for training is for employees to master the knowledge, skills and behaviors emphasized in training programs and to apply them to their day to day activities. In GSK Nashik I found that: Performance Appraisal process is carried out only for managerial staff. Performance Appraisal program are planned to align the requirements of the company mission

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GSK believes that the basic resource of the company is the quality of human capital, knowledge, skills and attitudes and combination of all three elements measures productivity and value creation capabilities.

Performance Appraisal is the symbol of enabling task of enhancing values and global competitiveness The company aims at creating a feeling of identity, cohesiveness and interdependence among different functions and ensures structures and effective team building across the organization.

RECOMMENDATION After studying and observing Performance Appraisal process carry out in GlaxoSmithKline Pharmaceutical Ltd. Nashik, following recommendation can be made. 1) Other tools for judging the performance of the appraisee should be use like 360 degree appraisal, feed back interviews etc.. 2) The necessary discussion between the appraiser-appraisee regarding the performance must be done at right time and in right way. 3) Performance appraisal process should conduct not only for managerial staffs but also for the lower staffs and workers 4) The periodic review should be conducted at least two or more times a year.

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5) The training and development department must seriously take up the programs identified after collecting and analyzing the appraisal data 6) Performance review discussion should be conducted with high Quality & care

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ANNEXURE

LIMITATIONS OF THE PROJECT

Any activity cannot to be so articulate and perfect that there are no limitations to it. Same was the case with my project. In spite of the project being successful I felt that if I had some more information or openings and of-course time, I would have worked better.

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The sample size was not satisfactory one due to time constraints. I couldt observe the objective setting process of GSK because it was already done in the month of January 2007. Some of the managers were not comfortable to express their true views in front of their superiors. Some of the employees have to report to the managers who work in the other unit than Nashik. I was not able to observe Performance Appraisal Process because the company executes the appraisal system in the month of December

5.1

BIBLIOGRAPHY

BOOKS: K.Aswathappa Human Resourse and Personnel Management

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 Garry Dessler - Human Resourse Management

MAGAZINES: The Human Factor (IIPM intelligence unit

publication) GSK- News

WEB SITES:

www.gsk.com

QUESTIONNEIR OF PERFORMANCE APPRAISAL

(For SENIOR,MIDDLE,&JUNIOR manager in GSK)

DEPARTMENT : NAME : AGE :

NO. OF YEARS EXPEREANCE: NO.OF YEARS IN GSK: LAST YEAR SCORE OF PA:

A)Performance planning objective: 1)What you say about the objective setting procedure in performance appraisal? a) Relavant b)According to business goal c)not satisfied. 2)Whether the objectives are written by you or your boss?
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a)by both c)by self.

b)by boss

3)Do you feel that the objective setting procedure to be changed? a)no change b)somewhat c)fully change 4)Whether time given to you for objective seting procedure is sufficient? a)need extra time b)sufficient c)more than require time. 5)Which of the following help you to set your objective? a)discussion with boss b)motivation by your apparaiser c)self innovation.

6)All the objective of performance are clear to you? a)somewhat b)not fully c)fully. 7)Discussion on the key result area before setting of the objective is educative to both? a)agreed b)partially agreed c)not agreed. B)Periodic Rewiew of performance. 1)When the periodic rewiew done in GSK? a)after 6months b)every month c)quarterly. 2) Is your objective are on the target?
62

a) On target c)exceed the target.

b) not on target

3) Are you satisfied with your speed of review towards completion of future target? a) Satisfied b) not much c) slightly. 4) Do you want any change in this procedure? a)somewhat b)need improvement c)no improvement. 5)You ever adopted certain methods to improve team spirit towards your objective? a)never b)partially c)fully. 6)Which of the following factor affect your performance? a)health b)family factors c)professional factors 7)Do you consider the key area time to time related to your job? a)never b)sometimes c)always. 8)At any time the team will face some tight deadlines which make work critical? a)no b)sometimes c)everytime. 9)what is your role doing appraisal rewiew? a)supportive b)somewhat c)not all supportive

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C)Annual Rewiew . 1)performance rewiew discussion are conducted with high quality & care? a)true b)somewhat true c)false. 2)Is HRD department provide adequate feedback to line manager on there behaviour? a)never b)sometimes c)everytime 3)Is the rewiew system provide opportunity to express your developmental needs? a)never b)sometimes c)mostly. 4)which type benefit you gain through annual rewiew? a)monetary b)non monetary c)both 5)Does appraisal finds out training needs & take seriously follow up? a)truly b)sometimes c)never. 6)Which of the following type consider while ranking ? a)transparency maintain b)biases are held c)faulty rewiew system 7)Are you satisfied with your score of these year? a)fully b)partially c)not satisfied 8)At which stage your objective lye at annual rewiew?

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a)successfully completed c)not completed.

b)exceed

9) Appraisal data is consider for the other developmental decisions like job rotation, job enrichment etc? a) true b)partially true c)false. 10) Is performance appraisal facilitates growth, mission,& goals, learning process in GSK? a)true b)partially true c)false 11) Are you happy with progress that you have made in GSK? a) yes b) no c)somewhat? 12)where you want to see yourself after 5years in this organization & how you will link up with your performance? a)exceeding 3grades b)2grades c)1grade. 13) Is individual performance based on effective Implementation of PA-system? a) yes b)no 14) Is effective PA- system is important factor for Improving individuals performance ? a) important b) not important

c)cant say

c)cant say

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