COMPARATIVE ANALYSIS OF

FMCG COMPANIES IN TERMS

OF PERFORMANCE
APPRAISAL

HRM
CIA

RIDHIMA GOYAL 1523154 3BBAHB

COMPARISON OF PERFORMANCE APPRAISAL OF DIFFERENT
COMPANIES UNDER FMCG SECTOR IN INDIA

PERFORMANCE APPRAISAL MEANING

Performance appraisal, also known as employee appraisal, is a method by which the job
performance of an employee is evaluated (generally in terms of quality, quantity, cost and time).
Performance appraisal is a part of career development.

TYPES
Management by objective (MBO)
Behaviorally anchored rating scales (BARS)
360 Degree
Assessment center
General appraisal
FMCG industry follows the modern techniques for performance appraisal and certain similarities
has been noticed in the studies between the competitors and differences also to take the
competitive advantages.

COMPANY- PROCTER AND GAMBLE (P&G)

P&G's core to the performance appraisal is work the 'Work and Development plan' (W&DP) system that
P&G has globally across all organizations, functions etc. The W&DP had four components

1. Previous years plan versus the results

2. Areas for further growth and development

3. Near-term and long-term career interests

4. Development and training plan for the year ahead.

In terms of 'Appraisal performance' this W&DP document is review on a quarterly basis to
monitor/track the performance. The performance appraisal is done using Forced Distribution
method in which feedback is collected by using 360-degree feedback method.

Also it has pre system to evaluate employee performance so as to reach an objective human
resource decision which is backed by documentation proof. It is majorly based on Management
by Objective (MBO) principle which concentrates on end result.

Process-
In terms of the 1st step steps in performance appraisal i.e. 'Defining the job' - with W&DP the
employee and his/her one level up manager .

2 level up manager agrees on the work and development plan for the year ahead, which defines
clearly the actions together with deadlines i.e. 'defining the job'.

P&G use ratings to assess contributions relative to others at job level, in order to manage
compensation and career progression according to the company's principles, as follows:

- Reward competitively

- Reward for performance

- Support the business

For these ratings P&G uses forced distribution method, in this method various percentages are
allocated to several performance categories. The portions in each category need not be
symmetrical. In Procter and Gamble the top 5%, middle 90% and bottom 5% method is used to
rate the employees in various categories.

COMPANY- PEPSI CO.

The jobs are evaluated on yearly basis under 360o method; the competent employees are
rewarded in shape of promotions, bonus, increments and annual holidays and promotion. The
results of an appraisal can be used to identify areas for further development of the employee.
The organization also uses different questionnaires, which consist of numerous questions about
the behavior of the employee, and then on the basis of these answers personality of the employee
is judged. When evaluation is made the unsatisfactory performers are given warning. The
employee after warning is put under observation, for some period of time and if the employees
performance is still unsatisfied then are demoted or fired.
COMPANY- NESTLE
Ratio in Smart objectives and Competencies:
SMART objectives 70% Competencies 30%
360-degree-performance-appraisal- Typically, performance appraisal has been limited to a
feedback process between employees and supervisors. However, with the increased focus on
teamwork, employee development, and customer service, the emphasis has shifted to employee
feedback from the full circle of sources depicted in the diagram below. This multiple-input
approach to performance feedback is sometimes called 360-degree assessment to connote that
full circle.
360 DEGREE PERFORMANCE APPRAISAL
Self-Assessment: This form of performance information is actually quite common but
usually used only as an informal part of the supervisor-employee appraisal feedback
session. Supervisors frequently open the discussion with: How do you feel you have
performed? In a somewhat more formal approach, supervisors ask employees to identify
the key accomplishments they feel best represent their performance in critical and non-
critical performance elements.

Peers, peers are often the most relevant evaluators of their colleagues performance.
Peers have a unique perspective on a co-workers job performance and employees are
generally very receptive to the concept of rating each other. Peer ratings can be used
when the employees expertise is known or the performance and results can be observed.
Sub ordinates: An upward-appraisal process or feedback survey (sometimes referred to
as a SAM, for Subordinates Appraising Managers) is among the most significant and
yet controversial features of a full circle performance evaluation program. Both
managers being appraised and their own superiors agree that subordinates have a unique,
often essential, perspective.
Customers: Internal customers are defined as users of products or services supplied by
another employee or group within the agency or organization. External customers are
outside the organization and include, but are not limited to, the general public.
Superiors: Evaluations by superiors are the most traditional source of employee
feedback. This form of evaluation includes both the ratings of individuals by supervisors
on elements in an employees performance plan and the evaluation of programs and
teams by senior managers.
 90%- 100% Outstanding Performance is the exceptional and exceed the expectations,
consistently demonstrates excellence standards in the job requirement.
75%-89% Good Performance is good meets the requirement.
60%-74% Fair Performance is fair needs some improvements .
By using this form the appraisers can effectively assess the employees and can make the best
decision, by using it they can come to know about the performance of the employees
regarding their KPI, competencies as well as about the SMART objectives they achieved
related to them. Example: For example a manager grade an employee 1 who is very good in
his work and his performance is high, but because of the strictness of the manager this
employees gain grade 6 form 10. Now an employees whose performance and involvement in
the work is low than the employee 2 but he is graded by the manager who is a lenient
manager, now the manager grade him 8.