A STUDY ON PERFORMANCE APPRAISAL IN

SHRACHI PRIVATE LIMITED, KOLKATA

A Project

submitted in partial fulfillment of the requirements for

the award of the Degree of

BACHELOR OF BUSINESS ADMINISTRATION

BY

Shankhadeep Banerjee (Roll No. BBA/45014/15)

Shreya Verma (Roll No. BBA/45037/15)

Preety Kumari (Roll No. BBA/45052/15)

Saurav Kumar Das (Roll No. BBA/45053/15)

Antra Choudhary (Roll No. BBA/45055/15)

DEPARTMENT OF MANAGEMENT

BIRLA INSTITUTE OF TECHNOLOGY,

MESRA - 835215, RANCHI

2018
 APPROVAL OF THE GUIDE

Recommended that the project entitled “A Study on Performance Appraisal in Shrachi

Private Limited, Kolkata” Prepared by Shankhadeep Banerjee, Shreya Verma, Preety
Kumari, Saurav Kumar Das and Antra Choudhary under my supervision and guidance
be accepted as fulfilling this part of the requirements for the degree of Bachelor of
Business Administration.

To the best of my knowledge, the contents of this project did not form a basis for the
award of any previous degree to anyone else.

Date:

(Prof. Soumendra Bhattacharjee)

Department of Management
Birla Institute of Technology, Mesra,
Kolkata Campus
 PROJECT APPROVAL CERTIFICATE

This is to certify that the work embodied in this project entitled “A Study on
Performance Appraisal in Shrachi Private Limited, Kolkata" carried out by
Shankhadeep Banerjee (Roll No. BBA/45014/15), Shreya Verma (Roll No.
BBA/45037/15), Preety Kumari (Roll No. BBA/45052/15), Saurav Kumar Das (Roll
No. BBA/45053/15) and Antra Choudhary (Roll No. BBA/45055/15) is approved for
the degree of Bachelor of Business Administration of Birla Institute of Technology,
Mesra, Ranchi.

Date:

Place: Kolkata

Internal Examiner(s) External Examiner(s)

Name & Signature Name & Signature

Chairman
(Head of the Department)
 ACKNOWLEDGEMENT
The satisfaction and euphoria that accompany the successful completion of the work
would be incomplete unless we mention the people, as an expression of gratitude,
who not only made it possible but their constant guidance and encouragement served
as a beacon of light and crowned our efforts with success. This project would have
been impossible without the support and guidance that we received from people at
different stages of the present work.

Without exaggeration we have to submit our self to our mentor Dr. Soumendra
Bhattacharjee, Assistant Professor Department of Management, BIT Mesra, Kolkata
Campus who not only helped us to do the project on our chosen area but also made
sincere and untiring effort to upgrade the quality of our project. Only by his scholarly
guidance, meticulous care, inspiring suggestion and perceptive criticism, the work
could be completed. In fact, it has been a great privilege for us to have an opportunity
of learning and working under his masterly and sure guidance.

We are grateful to Prof. S. Chaudhuri, (Officiating In-Charge), BIT Mesra, Kolkata

Campus for providing us an opportunity to do the said project. We also express our
heartfelt gratitude to all other faculties of BIT Mesra, Kolkata Campus for their
cheerful diligence provided during the project work.

We are indebted to Mrs. Jharna Chakraborty, Librarian and other staff members of the
library at BIT Mesra, Kolkata Campus for providing necessary help required to carry
out the project.

However, we accept the sole responsibility for any possible error of omission and
would be extremely grateful to the readers of this project if they provide valuable
suggestions.
 Shankhadeep Banerjee (Roll No. BBA/45014/15)

Shreya Verma (Roll No. BBA/45037/15)

Preety Kumari (Roll No. BBA/45052/15)

Saurav Kumar Das (Roll No. BBA/45053/15)

Antra Choudhary (Roll No. BBA/45055/15)

 TABLE OF CONTENTS

Title Page No.

List of Tables i-ii.

List of Diagrams iii-iv.

Chapter 1: INTRODUCTION

1.1 Introduction and Meaning. 1

1.2 Scope of the Study 2
1.3 Significance of the Study. 3
1.4 Objective of the Study. 3
1.5 Research Questions. 3
1.6 Design and Methodology of the Study 3
1.6.1 Universe of the study and Sample Selection Criteria. 3
1.6.2 Sample Size. 3
1.7 Data Collection. 3
1.7.1 Data Collection Period 3
1.8 Data Analysis 3
1.9 Future Scope of Study. 3
1.10 Limitations of the Study. 4
1.11 Chapterisation Scheme. 4

Chapter 2: COMPANY PROFILE 5-7

Chapter 3: PERFORMANCE APPRAISAL 8-20

3.1 Meaning and Definition 8

3.2 Need for Performance Appraisal 9-11
3.3 Process of Performance Appraisal 11-13
3.3.1 Establishing Performance Standards 11-12
3.3.2 Communicate Performance Expectations to Employees 12
3.3.3 Measure Actual Performance 12
3.3.4 Compare Actual Performance with Standards 12
3.3.5 Discuss the Appraisal with the Employee 12-13
3.3.6 Initiate Corrective Actions 13
 3.4 Methods of Performance Appraisal 13-20
3.4.1 Traditional methods 13-16
3.4.1.1 Ranking Method 13-14
3.4.1.2 Paired Comparison 14
3.4.1.3 Grading 14
3.4.1.4 Forced Distribution Method 14
3.4.1.5 Forced Choice Method 14-15
3.4.1.6 Checklist Method 15
3.4.1.7 Critical Incidents Method 15-16
3.4.1.8 Graphic Scale Method 16
3.4.1.9 Essay Method 16-17
3.4.1.10 Field Review Method 17
3.4.1.11 Confidential Report 17
3.4.2 Modern method 17-20
3.4.2.1 Management by Objective (MBO) 17-18
3.4.2.2 Behaviorally Anchored Rating Scales 18-19
3.4.2.3 Assessment Centres 19
3.4.2.4 360-Degree Appraisal 19-20

Chapter 4: ANALYSIS AND INTERPRETATION 21-43

Chapter 5: SUMMARY AND CONCLUSION 44-46

5.1 Summary and Findings 44-45

5.2 Conclusion 45-46

REFERENCES 47

ANNEXURE 48-51
 LIST OF TABLES

Sl. No. Description Page No.

1 Gender of Respondents 21
2 Category of Sample Respondents 22
3 Age of the Respondents 23
4 Length of Service of the Respondents 24
5 Operating a Formal Performance Management System 25
6 Respondents’ Feedback Regarding Techniques Used to 26
Assess the Performance
7 Frequency of Performance Appraisal in the Organization 27
8 Respondents’ Opinion about Performance Appraisal 28
9 Steps Taken to Rectify the Poor Performance 29
10 Respondents’ View about Linking Reward to Performance 30
11 Increment and Promotion Opportunities Based on the 31
Performance Rating
12 Role of Performance Appraisal System to Identify the 32
Strengths and Weaknesses of an Employee
13 Satisfaction Level of the Respondents Regarding the 33
Performance Appraisal System in the Organization
14 Purpose for Which Employees are Considered for Reward and 34
Recognition
15 Transparency of Performance Management System in the 35
Organization
16 Scope for Growth and Recognition of Employees Through 36
Performance Appraisal
17 Whether Performance Appraisal System Creates a Platform 37
for Interaction

(i)
18 Role of Performance Management System in Building 38
Interpersonal Skills.
19 Method Adopted for Reviewing the Performance of the 39
Employees
20 Whether Counselling and Guidance Facilities Provided Post- 40
Appraisal
21 Whether Performance Management System Needs to be 41
Changed in the Organization, or Not.
22 Performance Appraisal Increases Employee Motivation. 42

(ii)
 LIST OF DIAGRAMS

Sl. No. Description Page No.

1 Gender of Respondents 21
2 Category of Sample Respondents 22
3 Age of the Respondents 23
4 Length of Service of the Respondents 24
5 Operating a Formal Performance Management System 25
6 Respondents’ Feedback Regarding Techniques Used to 26
Assess the Performance
7 Frequency of Performance Appraisal in the Organization 27
8 Respondents’ Opinion about Performance Appraisal 28
9 Steps Taken to Rectify the Poor Performance 29
10 Respondents’ View about Linking Reward to Performance 30
11 Increment and Promotion Opportunities Based on the 31
Performance Rating
12 Role of Performance Appraisal System to Identify the 32
Strengths and Weaknesses of an Employee
13 Satisfaction Level of the Respondents Regarding the 33
Performance Appraisal System in the Organization
14 Purpose for Which Employees are Considered for Reward and 34
Recognition
15 Transparency of Performance Management System in the 35
Organization
16 Scope for Growth and Recognition of Employees Through 36
Performance Appraisal
17 Whether Performance Appraisal System Creates a Platform 37
for Interaction
18 Role of Performance Management System 38
in Building Interpersonal Skills.
19 Method Adopted for Reviewing the Performance of the 39
Employees

(iii)
20 Whether Counselling and Guidance Facilities Provided Post- 40
Appraisal
21 Whether Performance Management System Needs to be 41
Changed in the Organization, or Not.
22 Performance Appraisal Increases Employee Motivation. 42

(iv)
 CHAPTER 1

INTRODUCTION

1.1 INTRODUCTION AND MEANING: People differ in their abilities and

aptitudes. These differences are natural and cannot be eliminated even by
giving the same education and training to them. There will be some
differences in the quality and quantity of work done by different employees
even on the same job. Therefore, it is necessary for management to know such
differences so that the employees having better abilities may be rewarded and
the wrong placement of employees may be rectified through transfer.
Moreover, an individual employee may like to know his performance level in
comparison to his fellow employees so that he may improve the same if
required. Hence, there is a huge need to have suitable performance appraisal
system to measure the relative merit of each employee.

Performance appraisal is the systematic evaluation of the performance of

employees to understand the abilities of a person for further growth and
development. It evaluates an employee’s skill, achievements and growth.

The definitions of Performance Appraisal are as follows:

Dale Yoder has defined Performance Appraisal as “Performance Appraisal

includes all formal procedures used to evaluate personalities and contribution
and potentials of group members in a working organization. It is a continuous
process to secure information necessary for making correct objective decision
on employees”.1

According to Flippo, “Performance Appraisal is the systematic, periodic and

an impartial rating of an employee’s excellence in matters pertaining to his
present job and his potential for a better job”.2

1
Chhabra, T.N. (2008): ‘Human Resource Management, Concepts and Issues’, Dhanpat Rai & Co.(P)
Ltd, Delhi, p-378.
2
Khanka, S.S. (2009): ‘Human Resource Management (Text and Cases)’, S. Chand & Company Ltd.,
New Delhi, p-344

1
 According to Beach, “Performance Appraisal is a systematic evaluation of the
individual with regard to his or her performance on the job and his potential
for development”.3

Bellows said: “Performance Appraisal is defined as a systematic periodic

evaluation of the worth of an individual of an organization, usually mad by a
superior or someone in position to observe his performance”.4

According to Scot, Clothier & Spriegel, “Performance Appraisal is a process

of evaluating an employee’s performance of a job in terms of its
requirement”.5

1.2 SCOPE OF THE STUDY: The strength of any organization is its people i.e.
employees. If the employees are attended properly by identifying their talents,
developing their capabilities and utilizing them appropriately, then the
organization’s growth would be rapid. In any organization, some employees
may have capabilities to perform certain tasks better than other tasks, while
some employees may not have the capability to perform their assigned tasks.
In any case, an organization should ensure that its workforce is capable of
performing variety of tasks which are associated with their role or position.

This study would focus about the performance of the employees in Shrachi
Private Limited.

1.3 SIGNIFICANCE OF THE STUDY: This study of Performance Appraisal

would throw light in knowing about the performance of the employees in the
selected organization. It will enable the management to know about the
performance level of the employees and would provide important clues to the
managers so as to improve the performance level of the employees.

This study would also highlight the workers view about the performance
appraisal system followed at their work place.

3
Ibid
4
Ibid
5
Ibid

2
1.4 OBJECTIVE OF THE STUDY: The objective of the study includes:
• To know about the Performance Appraisal System followed in
“SHRACHI GROUP”.
• To know the level of satisfaction or dissatisfaction of the employees
about the Performance Appraisal System followed in their workplace.

1.5 RESEARCH QUESTION: The present study would enquire the following:
• Whether the employees are satisfied with the method of Performance
Appraisal followed at their place of work?

1.6 DESIGN AND METHODOLOGY OF THE STUDY: This study is based

on survey method. It would try to identify about the performance appraisal
method followed in the selected organization.
1.6.1 Universe of the study and Sample selection criteria:
a) Target Institution: The organization selected to carry out the
present study is ‘Shrachi Private Limited’.
b) Sample Selection: The sample unit for the study would be
individual employees who would be selected on the basis of
convenient sampling.
1.6.2 Sample Size: The size of the sample respondents for this study was 53
who were selected on the basis of convenient sampling.
1.7 DATA COLLECTION: For the purpose of this study both primary data and
secondary data were used. Primary data was collected with the help of
questionnaire and interaction with the respondents. Secondary data was
collected from reports, brochures, books, journals etc.
1.7.1 Data Collection Period: Data for the purpose of the study would be collected
during the month of February-April 2018.
1.8 DATA ANALYSIS: The collected data would be tabulated and analyzed by
using percentages etc.
1.9 FUTURE SCOPE OF STUDY: As the work force is an important
constituent of an organization, hence, it is very important on the part of the
management to evaluate and know about their performance. Similarly,
employees should also know where they stand so far as their performance is

3
 concerned. Hence, similar type of studies can be conducted with reference to
other organizations.
1.10 LIMITATIONS OF THE STUDY: The limitations of the study are as
follows:

• The period of study was only for about 3 months, which was considerably
short and hence it was constraint.

• The bias attitude of the respondents also acted as a hurdle to the study.

• The information collected through the questionnaire may not be accurate,

as some of the respondents might have given biased reply to the questions.

• The sample size selected for this study was relatively small due to the
constraint of time. This may not give an accurate picture of the scenario.

1.11 CHAPTERISATION SCHEME: The project report is divided into five

chapters.
Chapter 1 entitled ‘Introduction’ would give a brief meaning of Performance
Appraisal. It would also speak about the objective of the study, significance of
the study, research question, limitation of the study etc.

Chapter 2 entitled ‘Company Profile’ would give brief information about the
organization selected for this study.

Chapter 3 titled ‘Performance Appraisal’ would focus on meaning and

definition, needs, process and methods of performance appraisal.

Chapter 4 titled ‘Analysis and Interpretation’ would deal about the analysis
and interpretation of the collected data.

Chapter 5 titled ‘Summary and Conclusion’ would include summary of the

findings of the study. It would also contain the necessary suggestions, if any.

4
 CHAPTER 2

COMPANY PROFILE

From a humble beginning in 1996, Shrachi Group has grown from strength to strength
to be where it is today. Having started with just one business, today Shrachi Groups
has diversified into agro machinery, real estate, engineering, stationery and retail. The
company’s transparent policies and a penchant for perfection have always satisfied
shareholders and consumers alike.

As a leading conglomerate, dynamism and the desire to evolve have always led
Shrachi to explore newer territories in its ventures. Since its inception, Mr. Ganesh
Narayan and Mr. Brijlal Todi have inspired the team to Dream and Do. Thus, began
the journey of dreamers who do. Today, the Rs. 1000-crore conglomerate had
expanded into businesses as diverse as Real Estate, Agro machinery, Engineering &
EPC and Stationery under the able leadership of Mr. S.K.Todi and his sons Mr. Ravi
Todi and Mr. Rahul Todi. The Real Estate division of Shrachi Group has been
changing the sky line of Eastern India with landmark projects such as Renaissance
Township (Burdwan), Synthesis Business Park (Kolkata), RESTELLO (Kolkata) and
many others. The Agro machinery division (BTL EPC Agro) is presently the fourth
leading company of its kind and manufactures agro equipment like power tiller,
power weeder, power reaper and garden tools like brush cutter, chain saw etc. The
Engineering wing is a cost leader amongst the EPC contracting companies with its
own manufacturing units pan India. Brijlaxmi Paper Products Pvt. Ltd. is a young
company engaged in the manufacturing of an entire range of paper products and
stationery for students and executives alike.

Shrachi Real Estate: The Realty division of Shrachi has been changing the skyline
of Eastern India with landmark projects, such as Synthesis Business Park, Greenwood
Sonata, Greenwood Park, Greenwood Park Extension, Block by Block, Rosedale
Garden Complex, Restello in Kolkata and Renaissance Township in Barddhaman,
Junction Mall in Durgapur and many others. With over 30 residential and commercial
projects spread across Eastern India with a total developed area of over 1.90 crore
sqft, Shrachi has taken housing and infrastructure development to the next level. In

5
1997, Shrachi joined hands with the Government of West Bengal along with the State
Housing to form Bengal Shrachi Housing Development Ltd.

BTL EPC Limited(AGRO): For more than two decades BTL (Agro) has been
catering to the requirements of small and marginal farmers in India, thereby
contributing towards increased farm productivity and rapid mechanisation in the
agrarian sector. The company is known to be the pioneer in introducing cost-effective
power tillers in India in early 90s and with constant focus on improving the quality
and service of its product range, the company has grown to become the leading farm
machinery companies in its segment.
Since inception the company had a vision to provide a total solution to its target
customers and thereby it has gradually expanded its range to include power weeders,
reapers, garden tools and tractor implements. The company has also successfully
diversified into manufacturing of Aerobic Biotoilets whereby it aims to provide
environmental friendly total sanitation solution in the country and thereby contribute
to the success of Swachh Bharat Mission (SBM).

BTL EPC LIMITED: Completing 50 eventful years, BTL EPC Ltd. has emerged as
a multidisciplinary group with verticals as diverse as EPC (including manufacturing
of highly engineered products and process equipment) contracting across process
industries, Farm equipment, Real Estates, Stationary, Hospitality Management etc.

The major growth has been achieved since 2006 with the company venturing into
EPC. In these few years, the company has successfully won new businesses and
added significant skills in design, engineering & execution of projects in Bulk
Material Handling, Coal Chemical Plant, Process Equipment, Metal & Mineral
Beneficiation, Environment Management, Metal Preparation, Steel Plant Utilities etc.

Their Quality Assurance Program operates under guidelines which meet the most
stringent quality requirements. The uniqueness of BTL EPC Ltd. is in its in-house
manufacturing facilities which have enabled it to become a cost leader in the EPC
market. Over the last five decades BTL EPC Ltd. has acquired four manufacturing &
fabrication facilities in West Bengal. We have well-equipped modern Machine Shops,

6
which includes Heat Treatment, Precision Grinding and Fabrication facilities of all
description including Sheet Metal work.

Brijlaxmi: Brijlaxmi Paper Products Pvt. Ltd. is the Stationery vertical of Shrachi
Group incorporated in 2012. The Company is mainly engaged in the manufacturing of
an entire range of paper products and stationery for students and for corporate
executives.

7
 CHAPTER 3

PERFORMANCE APPRAISAL

3.1 MEANING AND DEFINITION: People differ in their abilities and aptitudes.
These differences are natural and cannot be eliminated even by giving the same
education and training to them. There will be some differences in the quality and
quantity of work done by different employees even on the same job. Therefore, it
is necessary for management to know such differences so that the employees
having better abilities may be rewarded and the wrong placement of employees
may be rectified through transfer. Moreover, an individual employee may like to
know his performance level in comparison to his fellow employees so that he may
improve the same if required. Hence, there is a huge need to have suitable
performance appraisal system to measure the relative merit of each employee.

Performance appraisal is the systematic evaluation of the performance of

employees to understand the abilities of a person for further growth and
development. It evaluates an employee’s skill, achievements and growth.

The definitions of Performance Appraisal are as follows:

Dale Yoder has defined Performance Appraisal as “Performance Appraisal

includes all formal procedures used to evaluate personalities and contribution and
potentials of group members in a working organization. It is a continuous process to
secure information necessary for making correct objective decision on employees”.6

According to Flippo, “Performance Appraisal is the systematic, periodic and an

impartial rating of an employee’s excellence in matters pertaining to his present job
and his potential for a better job”.7

According to Beach, “Performance Appraisal is a systematic evaluation of the

individual with regard to his or her performance on the job and his potential for
development”.8

6
Chhabra, T.N. (2008): loc.cit
.
7
Khanka, S.S. (2009): loc.cit
8
Ibid

8
3.2 NEED FOR PERFORMNACE APPRAISAL: The objectives of performance
appraisal fall in two categories:

1. Administrative Objectives:
(i) Promotions: This is perhaps the most important administrative use of
performance appraisal. It is to the common interests of both the
management and employees to promote employees into positions
where they can most effectively utilize their abilities. A properly
developed and administered performance appraisal system can aid in
determining whether individuals should be considered for
promotions. The system must rate the rate for the present job and his
potentialities for higher job. A person performing his job well does
not necessarily mean that he is fit for promotion.
(ii) Transfers: In an organization, it may be necessary to consider
various types of personnel actions such as transfers, layoffs,
demotions, and discharges. In some cases, such actions are called for
because of unsatisfactory performance while in other cases it may be
called for due to economic conditions over which the organization
has no control because of changes in the production process. Such
actions can be justified if they are based on performance appraisal.
(iii) Wage and Salary Administration: In some cases, the wage
increases are based on the performance appraisal reports. In some
cases, appraisals and seniority are used in combination.
(iv) Training and Development: An appropriate system of performance
appraisal can be helpful in identi2fying the areas of skills or
knowledge in which certain employees are not upto par, thus pointing
out general training deficiencies which presumably should be
corrected by additional training, discussions, or counseling.
Performance appraisal can also help in spotting the talented
employees so as to train and develop them to create an inventory of
creative skills. It can also provide the areas where
employees/executive could be further trained and positioned to meet
retirement and expansion situation.

9
 (v) Personnel Research: Performance appraisal helps in research in the
field of personnel management. Various theories in the human
relationship are the outcome of efforts to find out the cause and effect
relationship between the personnel and their performance.
2. Self-improvement: The performance appraisal brings out the deficiencies and
shortcomings of the employee. A discussion between the boss and the
subordinate conducted in a spirit of co-operation and mutual understanding
gives the chance to employee to have an insight on his performance in the
general set up of the organization. The way these discussions are conducted
gives chance to the employees to take suitable steps to improve upon their
performance or to correct their shortcomings.
It also helps to spot out a person’s ability to see an organization problem,
devise ways of attacking it, translate his ideas into actions, incorporate new
information as it arises and carry his plans through the results. It highlights a
sort of total managerial action in contrast to things we customarily factor out
as conceptual entities-things such as the planning function, leadership abilities,
or financial knowledge.

Why Performance appraisal?

The important reasons or benefits which justify the existence of a system of

performance appraisal in an enterprise are as under:

(i) A good system of performance appraisal helps the supervisor to

evaluate the performance of his employees systematically and
periodically. It also helps him to assign that work to individuals for
which they are best suited.
(ii) Performance rating helps in guiding and correction of employees.
The supervisor may use the results of rating for the purpose of
constructively guiding employees in the efficient performance of
work.
(iii) The ability to the staff is recognized and can be adequately
rewarded by giving them special increments.
(iv) Performance appraisal can be used as a basis of sound personnel
policy in relation to transfer and promotions. If the performance of

10
 an employee is better than others, he can be recommended for
promotion, but if a person is not doing well on a job, he may be
transferred to some other job.
(v) Rating can be used to evaluate the effectiveness of training
programmes. Weaknesses of employees are revealed by merit rating
and the training programmes can be modified accordingly.
(vi) Performance appraisal provides an incentive to the employees to
better their performance in a bid to improve their rating over others.
(vii) Systematic appraisals will prevent grievances and develop
confidence amongst the employees if they are convinced of the
impartial basis of evaluation. The records of merit rating are
available in permanent form to protect the management against
subsequent charges of discrimination which might be leveled by the
trade union leaders.

Performance appraisal has a beneficial effect on both the persons

doing the appraisal and being appraised. The appraisal brings
prominently to doing the attention of supervisors or executives the
importance of knowing their subordinates as human resources. The
necessity of performance appraisal leads the appraiser to a
thoughtful analysis of people rated and tends to make him more
alive to opportunities and responsibilities in developing the
subordinates.

3.3 PROCESS OF PERFORMANCE APPRAISAL: Though the specific steps that

an organization will follow in developing an appraisal system may vary somewhat
from organization to organization, yet the following are the common steps usually
followed by organizations while developing an appraisal system for them:

3.3.1 Establishing Performance Standards: The appraisal process begins

with the establishment of performance standards. The manager must
determine what outputs, accomplishments and skills will be evaluated.
These standards should have evolved out of job analysis and job
descriptions. These performance standards should also be clear and

11
 objective to be understood and measured. Standards should not be
expressed in an articulated or vague manner such as “a good job” or “a
full day’s work” as these vague phrases tells nothing.
3.3.2 Communicate Performance Expectations to employees: Once the
performance standards are established, theses need to be
communicated to the respective employees so that they come to know
what is expected of them. Past experience indicates that not
communicating standards to the employees compounds the appraisal
problem. It may be noted that mere transference of information from
manager to the employees is not communication. The feedback from
the employees on the standards communicated to them must be
obtained. If required, the standards can be modified or revised in the
light of feedback obtained from the employee. It is important to note
that communication is a two-way street.
3.3.3 Measure Actual Performance: This is the third step-in the appraisal
process. In this stage, the actual performance of the employee is
measured on the basis of information available from various sources
such as personal observation, statistical reports, oral reports, and
written reports. Needless to mention, the evaluator’s feeling should not
influence the performance measurement of the employee.
Measurement must be objective based on facts and findings. This is
because what we measure is more critical and important to the
evaluation process than how we measure.
3.3.4 Compare Actual Performance with Standards: In this stage, the
actual performance is compared with the predetermined standards.
Such a comparison may reveal the deviation between standard
performance and actual performance and will enable the evaluator to
proceed to the fifth step in the process.
3.3.5 Discuss the Appraisal with the employee: The fifth step in the
appraisal process is to communicate to and discuss with the employees
the result of the appraisal. This is, in fact one of the most challenging
task managers face to present an accurate appraisal to the employees
and then make them accept the appraisal in a constructive manner. A
discussion on appraisal enables employee to know their weakness and

12
 strengths. This has, in turn, impact on their future performance. Yes,
the impact may be positive or negative depending upon how appraisal
is presented and discussed with the employees.
3.3.6 Initiate Corrective Actions: The final step in the appraisal process is
the initiation of corrective actions when it is necessary. The areas
needing improvement are identified and then, the measures to correct
and improve the performance are identified and initiated. The
corrective actions can be of two types. One is immediate and deals
predominantly with symptoms. This action is often called as “putting
on fires.” The other is basic and delves into cause of deviation and
seeks to adjust the difference permanently. This type of action involves
time to analyze deviation. Hence, managers often opt for the immediate
action, or say, “put on fires, training, coaching, counseling, etc. are the
common examples of corrective actions that managers initiate to
improve the employee performance.

3.4 METHODS OF PERFORMANCE APPRAISAL

3.4.1 Traditional Methods:

3.4.1.1 Ranking Method: It is the oldest and simplest formal systematic

method of performance appraisal in which one performance is compared with all
others for the purpose of placing them in a simplest rank order of worth. The
employees are ranked from the highest to the lowest or from the best to the worst.
In doing this, the employee who is the highest on the characteristics being
measured and also the one who is the lowest, are indicated. Then, the next highest
and the next lowest are chosen, alternating between next highest and lowest until
all the employees to be rated have been ranked. Thus, if there are ten employees
to be appraised, there will be ten ranks from 1 to 10.

However, the greatest limitations of this appraisal method are that (i) it does not
tell that how much better or worse one is than another, (ii) the task of ranking
individuals is difficult when a large number of employees are rated, and (iii) it is
very difficult to compare one individual with others having varying behavioral

13
 traits. To remedy these defects, the paired comparison method of performance
appraisal has been evolved.

3.4.1.2 Paired Comparison: -In this method, each employee compared with other
employees on one-on-one basis, usually based on trait only. The rate is
provided with a bunch of slips each containing a pair of names, the rater
puts a tick mark against the employee whom he considers the better of the
two. The number of times this employee is compared as better with others
determines his or her final ranking. The number of possible pairs for a
given number of employees is ascertained by the following formula:
N (N-1)/2

Where N = the total number of employees to be evaluated.

3.4.1.3 Grading Method: -In this method, certain categories of worth are
established in advance and carefully defined. There can be three categories
of worth are established for employees: outstanding, satisfactory and
unsatisfactory. There can be more than three grades. Employee
performance is compared with grade definitions. The employee is, then
allocated to the grade that best describes his or her performance. Such type
of grading is done is semester pattern of examinations and in the selection
of candidate in the public service sector. One of the major drawbacks of
this method is that the rater may rate most of the employees on the higher
side of their performance.

3.4.1.4 Forced distribution Method: - this method was evolved by Tiffen to

eliminate the central tendency of rating most the employees at a higher end
of the scale. These methods assume that employee’s performance level
conforms to a normal statistical distribution i.e., 10,20,40,20 and 10
percent. This is useful for rating large number of employees’ job
performance and promotability. It ends to eliminate or reduce bias. It is also
highly simple to understand and easy to apply in appraising, the
performance of employees in organization. It suffers from the drawback
that if all distribution grades improve similarly, no single grade would rise
in ratings.

14
3.4.1.5 Forced Choice Method: - The forced choice method is developed by J.P
Guilford. It contains a series of groups of statements, and rater rates how
effectively statements describe each individual being evaluated. Common
method of forced choice method contains two statements, both positive and
negative. Examples of positive statements are:
• Gives good and clear instructions to the subordinates.
• Can be depended upon to complete any job assign.

A pair of negative statement may be as follows:

Making promises beyond his limit to keep these.

Inclines to favour some employees. Each statement carries a score or weight,
which is not made known to the rater. The human resource section doing
rating for all sets of statements- both positive and negative. The final rating is
done on the basis of all sets of statements. Thus, employee rating in this
manner makes the method more objective. The only problem associated with
this method is that is that the actual constructing of several evaluative
statements, also called ‘forced choice scales’, takes a lot of time and effort.
3.4.1.6 Check-list Method: - The basis purpose of utilizing check-list method is to
ease the evaluation burden upon the rater. In this method, a series of
statements i.e. question with their answers in ‘yes’ or ‘no’ are prepared by
the HR department. The check-list is, then, presented to the rater to trick
appropriate answer relevant to the appraise. Each question carries a
weightage in relationship to their importance. When check-list is
completed, it is sent to the HR department to prepare a final score for all
appraises based on all questions. While preparing questions, an attempt is
made to determine the degree of consistency of the rater by asking the same
question twice, but in different manner.
3.4.1.7 Critical Incidents Method: -In this method, the rater focuses his or her
attention on those key or critical behaviours that make the difference
between performing a job in a noteworthy manner (effectively or
ineffectively). There are three steps involved in appraising employees using
this method. First, a list of noteworthy (good or bad) on-the-job behavior of
specific incidents is prepared. Second, a group of experts then assigns

15
 weightage or score to these incidents, depending upon their degree of
desirability to perform a job. Third, finally a check-list indicating incidents
that describe worker as “good or bad” is constructed then, the check-list is
given to the rather for evaluating the workers.

The basic idea behind this rating is to appraise the workers who can
perform their jobs effectively in critical situations. This is so because most
people work alike in normal situation. The strength of critical incidents
method is that it focuses on behaviours and, thus, judges’ performance
rather than personalities.

3.4.1.8 Graphic Rating Scale Method: -The graphic rating scale is one of the
most popular and simplest techniques for appraising performance. It is also
known as linear rating scale. In this method, the printed appraisal form is
used to appraise each employee. The form list traits (such as quality and
reliability) and a range of job performance characteristics (from
unsatisfactory to outstanding) for each trait. The rating is done on the basis
of points on the continuum. The common practice is to follow five-point
scale. The rater rates each appraise by checking the score that best
describes his or her performance for each trait. At last, all assigned values
for the traits are then totaled.
3.4.1.9 Essay Method: - easy method is the simplest one among various appraisal
methods available. In this method, the rater writes a narrative description
on an employee’s strength, weakness, past performance, potential and
suggestion for improvement. Its positive points are that it is simple in use.
It does not require complex format formats and extensive/ specific training
to complete it.

However, essay method, like other methods, is not free from drawbacks. In
the absence of any prescribed structure, the essays are likely to vary widely
in terms of terms of length and content. And, of course, the quality of
appraisal depends more upon rater’s writing skill than the appraiser’s actual
level of performance. Moreover, because the essays are descriptive, the
method provides only qualitative information about the employee. In the
absence of quantitative data, the evaluation suffers from subjectivity

16
 problem nonetheless; the essay method is a good start and is beneficial also
if used in conjunction with other appraisal methods.

3.4.1.10 Field Review Method: -when there is a reason to a suspect rater’s

biasedness or his or her rating appears to be quite higher than others, these
are neutralized with the help of a review process. The review process is
usually conducted by the personnel officer in the HR department. The
review process involves the following activities:
(a) Identify areas of inter-rater disagreement
(b) Help the group arrive at a consensus.
(c) Ensure that each rater conceives of the standard similarly.

However, the process is a time-consuming one. The supervisors generally

recent what they consider the staff interference. Hence, the method is not
widely used.

3.4.1.11 Confidential Report: -it is the traditional way of appraising

employees mainly in the government department. Evaluation is made by
the immediate boss or supervisor for giving effect to promotion and
transferred. Usually a structured format is devised to collect information on
employees’ strength weakness, intelligence, attitude, character, attendance,
discipline etc.

3.4.2 Modern Methods:

3.4.2.1 Management by objective (MBO): -Most of the traditional methods

of appraisal are subject to the antagonistic judgments of the raters. It was
overcome this problem, Peter F. Drucker propounded a new concept, and
namely, management by objective (MBO) was back in 1954 in his book. The
practice of management. The concept of MBO as was conceived by Drucker,
can be describe as a “process whereby the superior and subordinate managers
of an organization jointly identify its common goals, define each individual’s
major areas of responsibility in terms of result expected of him and use these
measures as guides for operating the unit and assessing the contribution of
each of its members.” In other words, stripped to its essentials, MBO requires

17
the manager to get specific measurable goals with each employee and then
periodically discuss his or her progress toward these goals.

In fact, MBO is not only a method of performance evaluation. It is viewed by

practicing managers and pedagogues as a philosophy of managerial practice
because it is a method by which managers and subordinates plan, organize,
communicate, control and debate.

3.4.2.2 Behaviorally Anchored Rating Scale (BARS): - The problem of

judgmental performance evaluation inherent in the traditional method of
performance evaluation led to some organizations to go for objective
evaluation by developing a technique known as “behaviorally anchored rating
scales (BARS)” around 1960s. BARS are description of various degree of
behavior with regard to a specific performance dimension. It combines the
benefits of narratives, critical incidents, and quantified ratings by anchoring a
quantified scale with specific behavioural examples of good or poor
performance. The proponents of BARS claim that it offers better and more
equitable appraisals than do the other techniques of performance appraisal.

Developing a BARS typically involves five steps

• Generating Critical Incidents: critical incidents (or say, behaviours)

are those which are essential for the performance of the job effectively.
Person who are knowledgeable of the job in question (jobholders/ or
supervisors) are asked to described specific critical incidents of
effective and ineffective performance.
• Developing Performance Dimensions: The critical incidents are then
clustered into a similar set of performance dimensions, usually five to
ten. Each cluster, or say, dimension is then defined.
• Reallocating Incidents: Various critical incidents are reallocated
dimensions by another group of people who also the job in question.
Various critical incidents so reallocated to original dimension are
cluster into various categories, with each cluster showing similar
critical incidents.

18
 • Scaling Incidents: The same second group as in step 3 rates the
behavior described in each incident in terms of effectiveness or
ineffectiveness on the appropriate dimension by using seven to nine
points scales. Then, average effectiveness rating for each incident are
determined to decide which incidents will be included in the final
anchored scales.
• Development Final Bars Instrument: A subset of the incidents
(usually six or seven per cluster) is used as a behavioral anchor for the
final performance dimension. Finally, a BARS instrument with vertical
scales is drawn to be used for performance appraisal.

3.4.2.3 Assessment Centres: The introduction of concept of assessment

centres as a method of performance method is traced back in 1930s in the
Germany used to appraise its army officers. The concept gradually spread to
the US and UK in 1940s, and to the Britain in 1960s. The concept then
traversed from the army to business arena during 1960s. The concept of
assessment center is of course, of a recent origin in India. In India, Crompton
greaves, Eicher, Hindustan Lever and Modi Xerox have adopted this technique
of performance evaluation.

In business field, assessment center is mainly used for evaluating executive or

supervisory potential. By definition, an assessment center is a central location
where managers come together to participate in well-designed simulated
exercises. They are assessed by senior managers supplemented by the
psychologist and the HR specialists for 2-3 days. Assesses are asked to
participate in-basket exercises, works groups, simulations, and role playing
which are essential for successful performance of actual job. Having recorded
the assesee’s behavior the raters meets to discuss their pooled information and
observation and, based on it, they give their assessment about the assesee. At
the end of process, feedback in terms of strength and weaknesses is also
provided to the assesees.

3.4.2.4 360-Degree Appraisal: yet another method used to appraise the

employee’s performance is 360-degree appraisal. This method was first
developed formally used by General Electric Company of USA in 1992. Then,

19
it travelled to other countries including India. In India companies like Reliance
Industries, Wipro Corporation, Infosys Technologies, Thermax, Thomas Cook
etc. have been using this method for appraising the performance of their
employees. This feedback-based method is generally used for ascertaining
training and developments requirements, rather than for pay increases.

Under 360- degree appraisal, performance information such as employee’s

skills, abilities, and behaviours, is collected “all around” an employee, i.e.
from his/her supervisors, subordinates peers and even customer and clients. In
other words, in 360-degree feedback appraisal system, an employee is
appraised by his supervisor, subordinate’s peers and customer with whom he
interacts in his course of his job performance. All these appraisers provide
information and feedback on an employee by completing survey
questionnaires designed for this purpose. All information so gathered is then
compiled through the computerized system to prepare individualized report.
These reports are presented to the employees being rated.

Cost Accounting method: this method evaluates an employee’s performance

from the monetary benefit the employee yields to his/her organization. This is
ascertained by establishing a relationship between the cost involved in
retaining the employee, and the benefits an organization derives from him/her.
While evaluating an employee’s performance under this method, the following
factors are also taken into consideration: -

• Unit wise average value of production or service.

• Quality of product produced or service rendered.
• Overhead cost incurred.
• Accidents, damages, errors, spoilage, wastage caused through
unusual wear and tear.
• Cost of the time supervisor spent in appraising the employee.

20
 CHAPTER 4

ANALYSIS AND INTERPRETATION

This chapter would focus on the analysis and interpretation given by the sample
respondents on the various aspects of Performance Appraisal System on the basis of
the questions mentioned in the questionnaire.

Table 4.1: Gender of the Respondents.

Respondents Number Percentage

Male 43 81.00%
Female 10 19.00%
Total 53 100.00%
Source: Field Survey.

Diagram 4.1: Gender of the Respondents.

Female
19%

Male
Male
Female
81%

Source: Field Survey.

Analysis and Interpretation: From the above table it is evident that out of 53 sample
respondents, 43 i.e. 81.00% of them were Males and remaining 10 i.e. 19.00% of
them were Females.

21
 Table 4.2: Category of Sample Respondents.

Category Number of Percentage (%)

Respondents
Commercial Officer 09 16.98%
Supervisor 03 5.66%
HR Officer 02 3.77%
Marketing Officer 05 9.43%
Purchase Officer 02 3.77%
Cashier 02 3.77%
Engineers 15 28.30%
Clerk 07 13.21%
Accountant 02 3.77%
Office Assistant 06 11.32%
Total 53 100.00%
Source: Field Survey.

Diagram 4.2 Categories of Sample Respondents.

Designation
16
14
12
10
8
6
4
2
0

Source: Field Survey.

Analysis and Interpretation: The above table gives a breakup of the sample
respondents on the basis of their jobs. It can be seen that out of 53 sample
respondents, 09 i.e. 16.98% of them were Commercial Officers, 03 i.e. 5.66% of them
were Supervisor, 02 i.e. 3.77% of them were HR Officers, 05 i.e. 9.43% of them were

22
Marketing Officer, 02 i.e. 3.77% of them were Purchase Officer, 02 i.e. 3.77% of
them were Cashier, 15 i.e. 28.30% of them were Engineers, 07 i.e. 13.21% of them
were Clerk, 06 of them were Office Assistant i.e. 11.32% and 02 of them were
Accountant i.e. 3.77%.

Table 4.3 Age of the Respondents.

Age No. Of Respondents Percentage (%)

a) 25-35 years 18 34.00%

b) 36-45 years 27 51.00%

c) Above 45 years 08 15.00%

Total 53 100.00%

Source: Field Survey.

Diagram 4.3 Age of the Respondents.

15%

34%
25-35
36-45
Above 45

51%

Source: Field Survey.

Analysis and Interpretation: The above table states that out of 53 sample
respondents, 18 i.e. 34.00% respondents were between the age group of 25-35
years, 27 i.e. 51.00% respondents were between 36-45 years and 08 i.e. 15.00%.
respondents were above 45 years of age.

23
 Table 4.4 Length of Service of the Respondents.

Length of Service No. of Respondents Percentage (%)

a) 0-5 years 09 16.00%
b) 5-10 years 20 35.00%
c) 10-15 years 17 30.00%
d) Above 15 07 19.00%
years
Total 53 100.00%

Source: Field Survey.

Diagram 4.4 Length of Service of the Respondents.

Above 15 0-5 years

years 16%
19%
0-5 years

5-10 years 5-10 years

10-15 years
30% 35% 10-15 years
Above 15 years

Source: Field Survey.

Analysis and Interpretation: The above table and diagram speaks about the Length
of Service of the respondents. It is evident from the above that 09 i.e. 16.00% of the
respondents had maximum 5 years of experience, 20 i.e. 35.00% of them were with
more than 5 and less than 10 years of experience, 17 i.e. 30.00% of the respondents
had more than 10 and less than 15 years of experience while the rest 07 i.e. 19.00%
had above 15 years of experience.

24
 Table 4.5: Operating a Formal Performance Management System.

Operating A Formal No. of Respondents Percentage (%)

Performance
Management System
a) Yes 53 100.00%

b) No 00 0.00%

Total 53 100%

Source: Field Survey.

Diagram 4.5: Operating a Formal Performance Management System.

60

50

40

30
53

20

10

0 0
Yes No

Source: Field Survey.

Analysis and Interpretation: Based on the survey all the 53 i.e. 100% sample
respondents agreed to the fact that their organization has a formal operating
performance management system. Here there was no difference in opinion among the
respondents.

25
 Table 4.6: Respondents’ Feedback Regarding Techniques Used to Assess the
Performance.

Techniques No. of Respondents Percentage (%)

a) Assessment & 53 100.00%
Development
b) Observation 00 0.00%
c) Checklists 00 0.00%
d) Others 0 0.00%
Total 53 100.00%
Source: Field Survey.

Diagram 4.6: Respondents’ Feedback Regarding Techniques Used to Assess the

Performance.

60

50

40

30

20

10

0
Assesment & Observation Chechlists Others
Develpoment

Source: Field Survey.

Analysis and Interpretation: From the survey, it was found that all 53 i.e. 100.00%
of the sample respondents were of the view that the employees’ performance was
measured through the technique of Assessment and Development.

26
 Table 4.7: Frequency of Performance Appraisal in the Organization.

Frequency of No. of Respondents Percentage (%)

Performance
Appraisal
a) Quarterly 00 0.00%
b) Half-Yearly 00 0.00%
c) Annually 53 100.00%
Total 53 100.00%
Source: Field Survey.

Diagram 4.7: Frequency of Performance Appraisal in the Organization.

60

50

40

30

20

10

0
Quarterly Half-Yearly Annually

Source: Field Survey.

Analysis and Interpretation: All the 53 i.e. 100.00% sample respondents, reported
that performance appraisal is conducted Annually in their organization.

27
 Table 4.8: Respondent’s Opinion About Performance Appraisal.

Respondent’s No. of Respondents Percentage (%)

Opinion About
Performance.
a) Highly 35 66.00%
Beneficial
b) Beneficial to a 12 22.00%
certain degree
c) Tends to be 03 06.00%
Inflated
d) Not Beneficial 03 06.00%
Total 53 100.00%
Source: Field Survey.

Diagram 4.8: Respondent’s opinion About Performance Appraisal.

Not Beneficial at
all
Tends to be
6%
Beneficial to a Inflated
Certain Degree 6%
22%
Highly Beneficial
66%

Highly Beneficial Beneficial to a Certain Degree

Tends to be Inflated Not Beneficial at all

Source: Field Survey.

Analysis and Interpretation: The above diagram shows that out of 53 sample
respondents, 35 i.e. 66.00% of them felt that the Performance Appraisal was highly
beneficial to them as it helps to identify their weakness and strengths and help to
improve their work quality, 12 i.e. 22.00% of the sample respondents felt that it is
beneficial to them only to a certain degree, 3 i.e. 06.00% respondents said it tends to
be inflated, while the rest 03 i.e. 06.00% said it is not beneficial at all because they
think that citing out someone’s weakness is not a way to motivate them.

28
 Table 4.9: Steps Taken to Rectify the Poor Performance.

Steps Identification of Poor No. of Percentage (%)

Performance. Respondents

a) Training 29 54.72%

b) Relocation 15 28.30%

c) Discharge/Dismissal 09 16.98%

Total 53 100.00%
Source: Field Survey.

Diagram 4.9: Steps Taken to Rectify the Poor Performance.

30

25

20

15

10

0
Training Relocation Discharge/Dismiss

Source: Field Survey.

Analysis and Interpretation: From the above illustration it is evident that out
of 53 sample respondents, 29 i.e. 54.72% of them felt that only those candidates
whom the employee thinks can improve themselves are imparted for training, 15
i.e. 28.30% said that they are sent for Relocation i.e. the one whose potential
could be utilized in some other field, while the rest of 09 i.e. 16.98% said that they
are being terminated from duty after identification of poor performance post
review i.e. the one whose performance and working standards are not improved
even after proper guidance and coaching by taking suitable measures.

29
 Table 4.10: Respondents’ View about Linking Reward to Performance.

Linking Reward to No. of Respondents Percentage (%)

Performance
a) Motivate 24 45.00%
Employees
b) Do Nothing 15 28.00%

c) Demotivate 14 27.00%
Total 53 100.00%
Source: Field Survey.

Diagram 4.10: Respondents’ Views about Linking Reward to Performance.

Demotivate
27%
Motivate Motivate Employees
Employees
Do Nothing
45%
Demotivate
Do Nothing
28%

Source: Field Survey.

Analysis and Interpretation: From the above illustration, it can be seen that
out of 53 sample respondents, 24 i.e. 45.00% sample respondents thinks that
linking reward to performance would motivate them i.e. enhance their working
capability or performance since linking rewards increases competition and the
desire to achieve something will help them to improve their efficiency, while 15
i.e. 28.00% sample respondents thinks that it does nothing because according to
them the organization is biased in rewarding the employees, and remaining 14 i.e.
27.00% thinks that it demotivates them because of the negative attitude of the
management with regard to the same.

30
 Table 4.11: Increment and Promotion Opportunities Based on the
Performance Ratings.

Increment and No. of Respondents Percentage (%)

Promotion
Opportunities
a) Yes 29 55.00%
b) No 18 34.00%
c) Don’t Know 06 11.00%
Total 53 100.00%
Source: Field Survey.

Diagram 4.11: Increment and Promotion Opportunities Based on the

Performance Ratings.

Don't Know
11%

Yes

Yes No
No
34% 55% Don't Know

Source: Field Survey.

Analysis and Interpretation: The above table and diagram focuses on the
Increment and Promotion opportunities based on Performance Rating wherein it is
seen that out of 53 sample respondents, 29 i.e. 55.00% sample respondents think
that pay benefits and promotion opportunities are based on their performance
since there are precedence of employees getting promoted on the basis of their
performance; while 18 i.e. 34.00% of them feel that increment and promotion
opportunities are not based on their performance because they think that they are
being ignored at the time of appraisal; and the remaining 06 i.e. 11.00% were not
aware about the fact that whether increment and promotion is based on
performance rating.

31
 Table 4.12: Role of Performance Appraisal System to Identify the Strength
and Weakness of the Employees.

Identification of No. of Respondents Percentage (%)

Strength and
Weakness of
Employees
a) Yes 51 96.22%
b) No 02 03.77%

Total 53 100.00%
Source: Field Survey.

Diagram 4.12: Role of Performance Appraisal System to Identify the Strength

and Weakness of the Employees.

60

50

40

30

20

10

0
Yes No

Source: Field Survey.

Analysis and Interpretation: The above diagram illustrates that out of 53

sample respondents, 51 i.e. 96.22% of them responded in positive to the fact that
they are later informed about their performance by the management where their
problems and weakness are pointed out; while the rest 02 i.e. 03.77% sample
respondents responded in negative to the fact that performance appraisal system is
used as one of the parameters to identify employee’s strength and weakness or
not.

32
 Table 4.13: Satisfaction Level of the Respondents Regarding the Performance
Appraisal System in the Organization.

Level of Satisfaction No. of Respondents Percentage (%)

a) Satisfied 46 86.79%

b) Dissatisfied 07 13.21%

Total 53 100.00%
Source: Field Survey.

Diagram 4.13: Satisfaction Level of the Respondents Regarding the Performance

Appraisal System in the Organization.

13%

Satisfied
Dissatisfied
87%

Source: Field Survey.

Analysis and Interpretation: From the above diagram it is evident that out of 53
sample respondents, 46 i.e. 86.79% of them opined that they were satisfied with the
performance appraisal system in the organization while the remaining 07 i.e. 13.21%
of the sample respondents expressed their dissatisfaction about the performance
appraisal system in their organization because according to them the Performance
Appraisal process in the organization is biased.

33
 Table 4.14: Purpose for Which Employees are Considered for Reward and
Recognition.

Parameters considered No. of Respondents Percentage (%)

for Reward and
Recognition
a) Innovative and 12 22.60%
Creative Ideas
b) Increased 14 26.40%
Productivity
c) Both a) and b) 26 49.05%
Total 53 100.00%
Source: Field Survey.

Diagram 4.14: Purpose for Which Employee are Considered for Reward and
Recognition.

30

25

20

15

10

0
Innovative and creative Increased Productivity Both a) and b)
ideas

Source: Field Survey.

Analysis and Interpretation: From the above, it can be inferred that out of 53
sample respondents, 12 i.e. 22.60% of them think that innovative and creative
ideas lead them to reward and recognition since they are appreciated and
encouraged for providing new and creative ideas, on the other hand 14 i.e. 26.40%
of the sample respondents thinks that it is due to Increased Productivity, while 26
i.e. 49.05% sample respondents thinks that it looks after both the a) and b).

34
 Table 4.15: Transparency of Performance Management System in the
Organization.

Transparency of No. of Respondents Percentage (%)

Performance
Management System
a) Agree 41 77.36%
b) Disagree 12 22.64%
Total 53 100.00%
Source: Field Survey.

Diagram 4.15: Transparency of Performance Management System in the

Organization

45

40

35

30

25

20

15

10

0
Agree Disagree

Source: Field Survey.

Analysis and Interpretation: It can be inferred from the above table and
diagram that 41 sample respondents i.e. 77.36% agreed to the fact that the
Performance Management System in their Organization is transparent because
according to the respondents’ increment has been given to them and their work
has been appreciated by the superiors. On the other hand, 12 sample respondents
i.e. 22.64% disagreed because they think that there are some kind of biasness or
favoritism prevalent in the organization.

35
 Table 4.16: Scope for Growth and Recognition of Employees through
Performance Appraisal.

Scope for Growth and No. of Respondents Percentage (%)

Recognition
a) Agree 42 79.25%
b) Disagree 11 20.75%
Total 53 100.00%
Source: Field Survey

Diagram 4.16: Scope for Growth and Recognition of Employees through

Performance Appraisal.
45

40

35

30

25

20

15

10

0
Agree Disagree

Source: Field Survey.

Analysis and Interpretation: The above diagram states that out of 53 sample
respondents 42 i.e. 79.25% agreed to the fact that Performance Appraisal helps in
providing a scope for growth and recognition to the employees; 11 i.e. 20.75% of
the sample respondents disagreed to the fact, because according to them the
employees engaged in middle or higher level in an organization only gets
recognized and also they strongly believe that the employees engaged in top level
management only gets recognition.

36
 Table 4.17: Whether Performance Appraisal System Creates a Platform for
Interaction.

Response No. of Respondents Percentage (%)

a) Yes 38 71.69%
b) No 15 28.31%
Total 53 100.00%
Source: Field Survey.

Diagram 4.17: Whether Performance Appraisal System Creates a Platform

for Interaction.
40

35

30

25

20

15

10

0
Yes No

Source: Field Survey.

Analysis and Interpretation: From the above diagram and table it can be noted
that out of 53 respondents, 38 i.e. 71.69% of them were of the view that
performance appraisal system in their organisation creates a participative
environment where the employees and their superiors can easily interact and
participate in the performance analysis of employees; whereas 15 i.e. 28.31% of
the respondents felt that it does not create any participative environment.

37
 Table 4.18: Role of Performance Management System in Building
Interpersonal Skills.

Response No. of Respondents Percentage (%)

a) Yes 29 54.71%
b) To some extent 12 22.60%
c) No 12 22.60%
Total 53 100.00%
Source: Field Survey.

Diagram 4.18: Role of Performance Management System in Building

Interpersonal Skills.
29

12

12

YES TO SOME EXTENT NO

Source: Field Survey.

Analysis and Interpretation: It was reported that 29 out of 53 i.e. 54.71% of the
respondents believe that the performance management system in their
organisation have been helpful in developing their interpersonal skills. On the
other hand, 12 respondents i.e. 22.60% of them felt that the performance
management system in their organisation only helps to a certain extent in building
their interpersonal skills. Also, the remaining 12 i.e. 22.60% of the respondents
felt that performance management system in their organisation is not at all helpful
in developing their interpersonal skills.

38
 Table 4.19: Method Adopted for Reviewing the Performance of the
Employees.

Parameters Response of The Percentage (%)

Respondents
a) Superior 53 100.00%
Appraisal
b) Peer 00 0.00%
Appraisal
c) Customer 00 0.00%
Appraisal
d) 360⁰ 00 0.00%
Appraisal
Total 53 100.00%
Source: Field Survey.

Diagram 4.19: Method Adopted for Reviewing the Performance of the

Employees.
50

45

40

35

30

25

20

15

10

0
Superior Appraisal Peer Appraisal Customer Appraisal 360⁰ Appraisal

Source: Field Survey.

Analysis and Interpretation: From the above table it is evident that, 53 i.e.
100.00% of the respondents opted Superior Appraisal as the method used to
review the Performance of the employees.

39
 Table 4.20: Whether Counselling and Guidance Facilities provided Post-
Appraisal.

Response No. of Respondents Percentage

a) Yes 53 100.00%

b) No 00 0.00%

Total 53 100.00%

Source: Field Survey.

Diagram 4.20: Whether Counselling and Guidance Facilities provided Post-

Appraisal.

Yes
No

100%

Source: Field Survey.

Analysis and Interpretation: From the above diagram it is evident that out of 53
sample respondents, 53 i.e. 100.00% of them agreed that Counseling and Guidance
facilities if required are provided based on employee’s personal Performance.

40
Table 4.21: Whether Performance Appraisal System Needs to be Changed in
the Organization or not.

Response No. of Respondents Percentage (%)

a) Yes 05 9.43%
b) Not at all 48 90.57%
Total 53 100.00%
Source: Field Survey.

Diagram 4.21: Whether Performance Appraisal System Needs to be Changed

in the Organization or not.

9%

Yes
Not at All

91%

Source: Field Survey.

Analysis and Interpretation: It was reported that 9.43% i.e. 5 out of the total
respondents feel that a change is required in the current performance appraisal
system because the current system is unable to evaluate their performance and
competencies; 90.57% i.e. 48 respondents do not want any kind of change in their
current performance management system.

41
 Table 4.22: Performance Appraisal Increases Employee Motivation.

Response Option No. of Respondents Percentage (%)

a) Agree 42 79.25%
b) Disagree 11 20.75%
Total 53 100.00%

Source: Field Survey.

Diagram 4.22: Performance Appraisal Increases Employee Motivation.

21%

79%

Agree Diasagree

Source: Field Survey.

Analysis and Interpretation: The above figure illustrates that Out of 53

sample respondents, 42 respondents i.e. 79.25% agreed to the fact that
Performance Appraisal acts as a motivator to them because they think it gives
them scope for improvement and helps in improving their performance and also
boosts the morale of the employees and inspires them to achieve their goals; while
11 respondents i.e. 20.75% disagreed to the fact because they simply don’t find it
motivational.

From the analysis and interpretation, it can be inferred that most of the sample
respondents were satisfied about the various aspects of performance appraisal that
existed at their work place.

42
Hence, the research question whether the employees are satisfied with the method
of performance appraisal followed at their place of work can be justified to a
maximum extent

43
 CHAPTER 5:

SUMMARY AND CONCLUSION

5.1 SUMMARY AND FINDINGS: This chapter speaks about the summary and
findings of the study which are stated below.

• Each and every respondent (100.00%) have a positive opinion on the

operation of a formal Performance Management System in the organization.
• 100.00% of the employees interpret the Assessment & Development
technique is used to assess the Performance.
• Every respondent (100.00%) said that the occurrence of Performance
Appraisal in the organization is done annually.
• 66.00% of respondents are highly beneficial with the Performance Appraisal.
• After review of poor Performance almost 54.72% employees stated that they
are sent for training.
• Around 45.00% of the respondents have an opinion that linking reward to the
Performance would lead to motivation of employees.
• 55.00% of respondents have stated that all the increment and promotion
activities are based on Performance Rating.
• Performance Appraisal System helps in identifying the strength and weakness
of the employees according to 96.22% respondents.
• 86.79% of the respondents are satisfied with their Performance Appraisal
process in their organization.
• 49.05% of the respondents agree to the fact that employees are considered for
reward and recognition mostly for two reasons, a) Innovative and creative
ideas, and b) it increases productivity.
• 77.36% of the respondents agreed that the process of Performance Appraisal
System is transparent within the organization.
• Around 79.25% of respondents agree to the fact that Performance Appraisal
furnishes a scope for growth and recognition to the employees of the
organization.
• According to the respondents 71.69% respondents said yes to the fact that the
Performance Management creates a platform for interaction in the
organisation.

44
 • 54.74% of respondents said yes to the fact that the interpersonal skills are
developed due to Performance Appraisal System.
• Each and every respondent i.e. 100% opined that the method adopted for
reviewing Performance was Superior Appraisal.
• 100% of the respondents said that they were provided with proper counselling
and guidance facilities Post-Performance Appraisal process.
• 90.57% of the respondents said that they don’t want any changes in the
Performance Appraisal System of the organisation.
• Performance Appraisal increases employee motivation according to 72.25%
of the respondents.
The results revealed that all respondents are aware of the current Performance
Appraisal System in their organization and they do not need to be taught. Current
Performance Appraisal System works fine and is able to improve the performance of
the employees. This study has shown that Performance Appraisal System is a
comprehensive approach to planning and sustaining improvement in the performance
of employees so as to meet the required standards. The Human Resource
Professionals of the organization feels free to conduct Performance Appraisal System.
So, creation of trust among the employees about performance review techniques and
maintaining transparency with the employees for improving their performance is a
must for purpose of Performance Appraisal System.

5.2 CONCLUSION: From the facets of Performance Appraisal as designed in the

questionnaire, satisfaction of employees with their performance appraisal process was
all that we wanted to know.

Satisfaction with their performance appraisal process is perceived to be very vital

behind employees’ level of satisfaction. The study indicates that very few employees
were in dilemma about the performance appraisal process in their organization but
leaving them most of the respondents expressed their contentment with the
performance appraisal process.

People differ in their abilities and aptitudes. These differences are natural and cannot
be eliminated even by giving the same education and training to them. There will be
some differences in the quality and quantity of work done by different employees
even on the same job. Therefore, it is necessary for management to know such

45
differences so that the employees having better abilities may be rewarded and the
wrong placement of employees may be rectified through transfer. This is why
performance appraisal is important.

46
 REFERENCES

BOOKS:

[1]. Chabra, T.N. (2006): ‘Human Resource Management (Concept and Issues)’,
First (Revised) Edition, Dhanpat Rai and Co. Ltd., New Delhi.

[2]. Dessler, Garry. (2005): ‘Human Resource Management’, Tenth Edition, Peasrson
Education, Dorling Kindersley (India) Pvt. Ltd., New Delhi.

[3]. Dhar, Rajib Lochan, (2010): ‘Strategic Human Resource Management’, Second
Edition, Excel Printers Pvt. Ltd, Gurgaon.

[4]. Khanka, S.S. (2007): ‘Human Resource Management (Text and Cases)’, First
(Revised) Edition., S. Chand & Company Ltd, New Delhi.

[5]. Kothari, C.R. (2006): ‘Research Methodology’, Second (Revised) Edition

New Age International Publisher, New Delhi.

[6]. Saiyadain, Mirza S. (2010): ‘Human Resources Management’, Fourth Edition,

The M C Graw Hill Education Private Limited, New Delhi.

WEBSITES:
http://www.shrachi.com/ Retrieved on 17th March 2018

47
 ANNEXURE

QUESTIONNAIRE FOR THE STUDY OF “PERFORMANCE APPRAISAL IN

SHRACHI PRIVATE LIMITED”

Dear Sir/Madam

This is a humble request to you to go through the questionnaire and respond to

the questions given. This will be of immense help in our Project work title “A study
of Performance Appraisal in Shrachi Private Limited”.

You may be assured that proper secrecy may be maintained in regard to your
opinion expressed. The data will be used strictly for the academic purpose only.

Thanking you.

SHANKHADEEP BANERJEE (Roll No. BBA/45014/15)

SHREYA VERMA (Roll No. BBA/45037/15)

PREETY KUMARI (Roll No. BBA/45052/15)

SAURAV KUMAR DAS (Roll No. BBA/45053/15)

ANTRA CHOUDHARY (Roll No. BBA/45055/15)

QUESTIONNAIRE

1. Name :
2. Sex : Male/Female/Others [Please tick ()]
3. Designation: _______________________________
4. Age Group:
a) 25-35
b) 36-45
c) Above 45

48
5. Experience:
a) 0-5 Years
b) 5-10 Years
c) 10-15 Years
d) Above 15 Years
6. Does your organization operate a formal Performance Appraisal System?
a) Yes
b) No
7. What do you think are the techniques used to assess the Performance?
a) Assessment & Development
b) Observation
c) Checklists
d) Others (Specify): ___________________________________
8. How often do you have Performance Appraisal in your Organization?
a) Quarterly
b) Half-Yearly
c) Annually
9. Your opinion on Employees’ Performance-Appraisal?
a) Highly beneficial
b) Beneficial to a certain degree
c) Tends to be inflated
d) Not beneficial at all
10. What is done after identification of poor Performance post review?
a) Training
b) Relocation
c) Discharge/Dismissal
11. Do you believe that linking reward to Performance would?
a) Motivate employees
b) Do nothing
c) Demotivate

49
12. Are your increment and promotion opportunities based on your Performance
Ratings?
a) Yes
b) No
c) I Don’t Know
13. Does Performance Appraisal System help to identify the strength and weakness
of an employee?
a) Yes
b) No

14. Are you satisfied with the Performance Appraisal process in your organization?
a) Satisfied
b) Dissatisfied
15. Purpose for which employees are considered for reward and recognition mostly
for: -
a) Innovative and creative ideas
b) Increased Productivity
c) Both a) and b)
16. Is the process of Performance Appraisal System transparent within the
organization?
a) Agree
b) Disagree
17. Performance Appraisal process of your company, furnishes a chance of growth
and recognition to the employees?
a) Agree
b) Disagree
18. Does the Performance Appraisal System create a platform for interaction in the
organization?
a) Yes
b) No

50
19. Does your interpersonal skills are developed due to Performance Appraisal
System?
a) Yes
b) To some extent
c) No
20. Which kind of style is adopted by your organization in reviewing the
Performance of their employees?
a) Superiors appraisal
b) Peer appraisal
c) Customer appraisal
d) 360° Appraisal

21. After the Performance review done by the appraiser, that is the by the
management, is the personal counselling and guidance based on employees
individual Performance is given? Since it is necessary to motivate the employees
if their Performance is not up to the mark.
a) Yes
b) No

22. Do you want any changes in the Performance Appraisal System in your
organisation?
a) Yes
b) Not at all
23. Performance Appraisal increases employee motivation or not?
a) Agreed
b) Disagreed

51