ABSTRACT

Performance Management System is a management technique intended to holistically consider the performance of (usually a group of) employees or machines to work towards optimum performance of a particular task or (more frequently) a group of tasks It is a . predetermined set of guidelines for individuals employed by a company. The system is used to describe the current position to the employee and lay out the expectations of company management for the employee. Hence it is a tool used by companies in developing and training their employees. Information about company positions, goals and compensation are disclosed to individuals so they understand the importance to company operations. Companies also give employees the framework for achieving bonuses and pay increases from performance reviews. The project focuses on performance management system at NMDC to measure the employees performance and the alignment of the system within the organization. NMDC conducts surveys and face-to-face meetings with the employees to gain information. NMDC gives respects to employees and the job they perform. In every interaction with management, NMDC treats employees with courtesy and interest .Counselling is done to overcome the problems of employees .It maintains an easy avenue for employees to discuss problems with upper management and carefully monitor. Even if management cannot meet all the demands of employees , then showing employees that they are being heard and putting honest dedication into compromising will often help to improve morale.

INTRODUCTION
HISTORY Over the past decade or so the term performan management has replaced the phase ce performance appraisal in many organizations .Whereas performance appraisal emphasized the (usually annual) evaluation of employees performance. No one knows precisely when formal methods of reviewing performance were first introduced .It is said that the emperors of WEI-DYNASTY(AD 221-265) had an IMPERIAL RATER whose task was to evaluate performance of OFFICIAL FAMILY. Centuries later, Ignatius Loyola established a system for formal rating of the members of the Jesuit Society. The first monitoring systems, however evolved out of the work of Frederick Taylor and his followers before World War 1.Rating for the officers in the U.S armed services was introduced in the1920s, and this then spread to U.K , as did some of the factory based American systems. Merit rating came to the fore in U.S.A and in U.K in 1950s and 1960s, when it was sometimes re-christened performance appraisal. Management by objectives came and went into 1960s and 1970s and experiments were made with the critical incident technique and behaviourally anchored rating scales .A revised form of result-oriented performance appraisal emerged in 1970s and still exists today. The earliest reference to performance management in the literature was made by Warren (1972).The term performance management was first used in 1970s by Beer and Ruh. Their thesis was that: performance is best developed through practical challenges and experiencing on the job with guidance and feedback from superiors. They described the Performance Management System at Corning Glass Works, the aim of which was to help managers give feedback in a helpful and constructive way and to aid in the creation of a developmental plan .However it did not become a recognised process until the latter half of the 1980s.The concept of performance management then lay follow for some years but began to emerge in United States as a new approach to managing performance in the mid -

1980s.This was confirmed by the research project conducted by Institute of Personnel Management in1992 and produced the definition for performance management. The strategy which relates to every activity of the organization set in the context of its Human Resource policies ,culture, style and communication systems. The nature of the strategy depends on the organizational context and can vary from organization to organization. It was suggested that what was described was performance management system(PMS).In 1992 research found that in the organizations with performance management

system,85%(31% of respondents to CIPD survey 2003) had performance-related pay and 76%(59% in 2003)rated performance. The emphasis was on the objective setting and review.

CONCEPT OF PERFORMANCE MANAGEMENT The term Performance Management first came into wide use in the H.R field in the earlys 1990s.Although objective setting ,assessment and review and performance-related pay were becoming common prior to that period, it was not until the late 1980s that organizations started to be concerned with the management of individual performance in a holistic way. Even when the Institute of Personnel Management first carried out research in the area in 1992, there was confusion over what the term Performance Management actually meant. For some it was an appraisal process, for others performance related pay and yet others defined it in terms of training and development . By the time of our second survey in 1977 there was much more agreement about what the term performance management meant, with a distinct polarisation between those who taught it focused on pay and those who believed it was development lead.
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It is now commonly greed that performance management as a natural process of management contributes to the effective management of individuals and teams to achieve high levels of

organizational performance .As such, it establishes shared understanding about what is to be achieved and an approach to leading and developing people which will ensure that it is achieved.Other definitions of performance management are as follows:
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A systematic approach to developing individual and team performance in order to achieve organizational goals (Hendry et al).

The development of individuals with competence and commitment, working towards the achievement of shared meaningful objectives within an organization that supports and encourages their achievement (Lockett).

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Performance management is managing the business (Mohrman and Mohrman). Directing and supporting employees to work as effectively and efficiently as possible in line with the needs of the organization(Walters).

PERFORMANCE MANAGEMENT AND PERFORMANCE APPRAISAL The terms performance management and performance appraisal are sometimes used synonymously, but they are different. Performance Management is a comprehensive, continuous and flexible approach to the management of organizations, teams and individuals which involves the maximum amount of dialogue between those concerned. Performance Appraisal is a more limited approach which involves managers making top-down assessment and rating the performance of their subordinates at an annual performance appraisal meeting.

MEANING Performance Management System is a process which is used to evaluate and improve the efficiency and effectiveness of an organization and its processes .A good performance management system includes clear expectations for an employee's current job, feedback about how he is doing, specific tools for improvement or advancement and rewards for good performance. It is the heart of any "people management "process in organization. Performance management systems if properly designed and implemented can change the course of growth and pace of impact of organizations. This system requires proper management of performance. The evolution of the concept of performance Management as a new Human Resource Management Model reflects a change of emphasis in organizations away from command-and-control toward a facilitation model of leadership. This change has been accompanied by recognition of the importance to the employee and the institution of relating work performance to the strategic or long-term and overarching mission of the organization as a whole. It is a relatively new concept to the field of management. It typically starts out with various examinations of the term performance.

Recently, organizations have been faced with challenges like never before. Increasing competition from business across the world has meant that all businesses must be much more careful about the choice of strategies to remain competitive. Everyone (and everything) in the organization must be doing what they are supposed to be ensure strategies are implemented effectively. This situation has put more focus on effectiveness, that systems and processes in the organization be applied in the right way to the right things to achieve results. The performance management is an ongoing process which helps in managing and planning the performance and it also provides an opportunity for the employee and performance manager to discuss developments, goals and jointly create a plan for achieving those goals. Development plans should contribute to organizational goals and the

professional growth of the employee. In the course of performance management ,appraisal system is conducted to review the performance and it helps in analyzing the performances, planning, setting goals, objectives etc. Annual performance appraisal exercises provide good opportunities for performance planning. Performance appraisal is a potential instrument and performance analysis forms the part of performance appraisal system.

DEFINATION Performance Management Performance management can be defined as a planned method to improve the performance of individuals employees by improving their skills and abilities thereby leading to the success of the organization by Armstrong and Baron. Performance Management System Performance management system can be defined as a set of interrelated activities and processes that are treated holistically as a integrated and a key component of an organizations approach to managing performance through people and developing the skills and capabilities of its human capital thus enhancing organizational capability and achievement of sustained competitive advantage.

OBJECTIVES 1. To develop and improve performance of individuals and teams and therefore organizations. 2. To check the effective & efficiency of individuals, teams & organization 3. To provide the basis for personal development. 4. To align individual and organizational objectives. 5. To develop a performance culture. 6. Performance Management can be used to determine whether HR programs such as selection, training, and transfer have been effective or not. 7. To inform contribution/performance pay decisions.

RESEARCH METHODOLOGY

Research Methodology is the systematic and objective identification, collection, analysis, dissemination and the use of information for purpose of assisting management in decision making related to the identification and solution of the problem and opportunity. The data are collected using the most appropriate method and are analyzed, interpreted and inferences are drawn and finally the findings, implications, recommendations are provided in a format that allows the information to be used for decision making.

RESEARCH DESIGN: The research methodology is the arrangement for collection and analysis of data in a manner that aims to combine relevance to the research purpose with economy in procedure. I have adopted multiple choice questionnaire research design for my project because descriptive research is concerned with describing the characteristics of a particular individual or a group DATA COLLECTION METHOD A.Primary Data: Data collected by a researcher is known as primary data .It is collected by a person for his own use obtained from findings .This is considered as first hand information .This is that data which is collected by us to meet our own specific purpose .The data is collected by means of questionnaire filled in by the employees of NMDC corporate office, Hyderabad. Whenever needed informal interviews were conducted. B.Secondary Data: Secondary data means that are already available i.e they refer to the data which are already been collected and analyzed by someone else. Secondary data can either be published data or unpublished data.

Published data used here is from:Annual reports of the company Various websites Books/Journals/Govt reports

THE RESEARCH APPROACH Survey Method.

THE RESEARCH INSTRUMENT Questionnaire.

THE RESPONDENTS Executives of the organization .

SAMPLE DESIGN Questionnaire on satisfaction level of executives with the performance appraisals facilities provided and current status of Performance Management System at NMDC.

Sampling unit Sample size Sample technique

: The unit comprises of executives from different departments. : 50 out of population size 300. : The technique adopted here is Questionnaire Method. They were

selected from executives Corporate Office of NMDC limited at Hyderabad.

STATISTICAL TOOLS Bar Graph analysis method was used for analysis of data.

COMPANY PROFILE
NMDC Limited is a public sector company under the Ministry of Steel, Government of India. Primarily engaged in the business of exploring minerals and developing mines to produce raw materials for the industry, it is also expanding its activities towards steel making and other value added products. It has been conferred Navratna status by Government of India .NMDC has been incorporated in 1958 as a Government of India fully owned public enterprise .NMDC .Since inception involved in the exploration of wide range of minerals including iron ore, copper, rock phosphate, lime stone, dolomite, gypsum, bentonite, magnesite, diamond, tin, tungsten, graphite, beach sands etc. It is the India's single largest iron ore producer and exporter, presently producing about 30 million tons of iron ore from 3 fully mechanized mines viz., Bailadila Deposit-14/11C, Bailadila Deposit-5, 10/11A (Chhattisgarh State) and Donimalai Iron Ore Mines (Karnataka State) which are awarded ISO 9001 2000 certification

MISSION: To emerge as a global environment friendly Mining Organization with International standards of excellence, rendering optimum satisfaction to all its stakeholders.

VISION: From a single product-company-single-customer company, NMDC has known to be a major Indian iron ore supplier in the Nation and important supplier of iron ore in International markets .The company has planned to increase iron ore production to 50 million tonnes by 2014-2015 by developing new mines of Bailadila-11/B and Kumarswamy , on the one hand and other ,by expanding the production capacity of existing mines Production.

COMPANY'S REGISTERED AND HEAD OFFICE NMDC company's registered and head office is located in Hyderabad at Khanij Bhavan, Masab Tank.

CONTRIBUTIONS TO INDIAN ECONOMY Incorporated in 1958, NMDC has been actively contributing to the development of the nation for five decades and grown from strength to strength on its journey to nation building and its contributions are 1. It has earned foreign exchange to the tune of Rs. 16,228 crore. 2. It has been paying dividend since 1990-91. For the financial year ended 31 March 2010, the dividend paid to the Government of India is Rs. 649 crore and the cumulative dividend up to 2009-2010 is Rs. 3,533 crore approximately. 3. In 2009-10 gross contribution to the national exchequer was Rs. 3,123 crore. 4. It has about 6000 employees.

HUMAN RESOURCES NMDC is known for its excellence of human assets. The company exhibits the best possible work culture, and its manpower productivity shows continuous growth. The per capita productivity in NMDC is now about 30 metric tonnes of output per man shift. More than 50% of its employees belong to the weaker sections of the society, viz., Scheduled Castes, Scheduled Tribes and Other Backward Castes, speaks of NMDCs consciousness of its social responsibility.The company maintains modern townships with all the necessary facilities for its around 6000 employees in Bailadila complexes in Chhattisgarh, Donimalai in Karnataka, Panna in Madhya Pradesh and its other units across India.

RESEARCH AND DEVELOPMENT From a nucleus R&D cell set up in 1970, it has grown into a highly sophisticated R&D Centre. One of the best-equipped laboratories of its kind, the centre at Hyderabad can take up any assignment in the field of ore beneficiation and mineral processing. With its excellent research facilities, the Centre carries out technology development missions in field like mineral processing, flow sheet development, mineralogical studies and product development. It has been recognized as a Centre of Excellence

CORPORATE SOCIAL RESPONSIBILITY NMDC has taken up CSR activities even much before the concept was formally introduced. It has now strengthened its CSR activities. The beneficiaries are mostly the tribals / backward sections in the proximity of the mines, which are in remote locations. The areas focused are education, health, Medicare, drinking water, infrastructure development and self employment, These services are provided in consultation with the local people and the local administration. The CSR initiatives are not limited to the Companys operational areas alone, but extended to all corners of the country.

ENVIRONMENT MANAGEMENT NMDC pays utmost attention to the environmental management. It has its own Environment Management Programme. Restoration and conservation of forest are its prime objective, and its self-commitment is that the mined out areas will have a better forest than it was when NMDC entered the area. The afforested areas in the mines stand testimony to this commitment.

ACCREDITION NMDC has obtained for its mines the following accreditations:
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ISO 9001-2000.All its iron ore mines and R&D center ISO 14001-2004 by Det Norske Veritas, The NetherlandsAll its production mines. Besides, NMDC is now in the final stage for obtaining OHSAS 18001-2007 Certification for its Occupational Safety and Health Management

OFFICES OF NMDC Limited: The various Offices of NMDC are located at various places such as Hyderabad, Chhattisgarh, Karnataka, New Delhi , Kolkata, Visakhapatnam ,Bangalore,Chennai,Jammu, Himachal Pradesh, Madhya Pradesh, Khammam , Bhubaneswar,(East) Mumbai, Allahabad(U.P)Raipur.

PROJECTS DONIMALAI IRON ORE MINE Commissioned Capacity Port of export : : : October,1977 4.0 million tonnes of ROM ore/year a)Chennai outer harbour.Capable of handling ships of 1,30,000DWT-532Kms.Rail link b)Marmagoa port ,Goa. Capable of handling panama size vessels-370Kms rail ink No . of employees : 1238 ISO 9002 certification awarded in Febuary ,1999

PANNA DIAMOND MINE Capacity Incidence Total diamonds recovered So far No. Of employees : 1005064 carats approx : 329 : 84,000 carats per year : 10 carats per 100 tons of tuff material

BAILADILA IRON ORE MINE , BACHELI COMPLEX Commissioned Capacity Port of export ships : January,1977 : 6 million tonnes of ROM ore/year : Vizag outer harbour. Capable of handling Upto1,30,000 DWT Rail link to vizag No. of employees : 471 kms : 1777

BAILADILA IRON ORE MINE, KIRANDUL COMPLEX Commissioned Product Capacity Port of export : April, 1968 : Lump-150mm+10mm fine -10mm : 5.50 million tonnes ROM ore/year(original) : Vizag outer harbour. Capable of handling ships Upto 1,30,000DWT Rail link to Vizag No. Employees : 475 Kms. : 1806

AWARDS
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NMDC and its employees have received many awards from various forums since many years. Details of some of the awards are given below. Management Excellence Awards

Manager of the Year Award 2007 to CMD from Hyderabad Management Association, Hyderabad .

ICWAI National Award for Excellence in Cost Management 2006 from ICWAI, New Delhi Productivity Awards

Coal India Productivity by the Indian Institution of Industrial Engineering for the years 200405 & 2005-06. Environment Pollution Control Awards

Jawaharlal Nehru Memorial National Award 2004-05 for Excellent Environment & Ecological Implementation Award from International Greenland Society, Hyderabad.

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Greentech Environment Excellence Silver Award 2004-05 for Bacheli Complex. FIMI Environment Excellence Award 2005-06 for Bacheli Complex.

Marketing Awards
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CAPEXIL Special Export Award for the year 2003-04, 04-05 & 2005-06. Niryat Shree Certificate of Excellence for outstanding Export Performance in the category of Residual Products, Non-SSI for the year 2004-05 from Federation of Indian Export Organisations, New Delhi .

Others
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Raj Bhasha Shield from Town Official Language Implementation Committee (Undertakings) for the year 2003-04, 05-06 & 06-07.

CMD received Bharat Ratna Sir Mokkshagundam Visvesvaraya Award 2005 instituted by Institution of Engineers ( India ), AP State centre and Govt. of AP.

Indira Gandhi Rajbhasha Shield for excellent implementation of official language and progressive use of Hindi amongst the PSUs in region C for the year 2003-04 & 2004-05.

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Rashtra Bharat Puraskar 2005 from Institute of Public Enterprises, Hyderabad . CMD received Rajiv Ratna National Award -2005 for Excellence in Indian Industries as Best Chief Executive Gold Award from What Hails Public Sector Today, a National Magazine.

FIMI Social Awareness Award 2005-06 for Kirandul Complex.

PERFORMANCE APPRAISAL SYSTEM IN NMDC

For the purpose of performance appraisal employees are divided into two types. namely as follows.

1)Executives 2)Non-executives

The performance appraisal system for executives has only been taken up for the project work. For the executives a form is designed which consists of 12 pages. It is again divided into two. Form 1 and Form 2 Form 1 is divided into 5 sections, namely as follows. Section-A(the job) Section B(behavioural dimensions)Section C(overall assessment)Section D(strengths and areas of improvement and development plan) Section E (potential review). This performance appraisal form will be done in the beginning of the year. And duly signed by the appraisal and appraisee.

Form 2 deals with self appraisal ,which is to be filled by the appraisee (employee himself).A. Performance appraisal form B. Self Appraisal form. In Section B (Behavioural dimensions) there are 12 dimensions. In the executives are assessed against five parameters namely1.Barelyadequate(BA)2.Satisfactory(S)3.Good(G)4.Verygood(VG)5.Outstanding(OS) The dimensions assessed are 1.Communication 2.Interpersonal relations 3.Analytical ability 4.Systematic approach 5. Conduct 6. Sincerity 7. Initiative 8. Team work. 9 . Creativity 10. Quality consciousness and 12. Cost consciousness. This section is most crucial in the entire performance appraisal system in NMDC,in respect of executives a copy of the form is

enclosed as annexure 1the corporation has also prescribes detailed guidelines for filling up of form1.

Performance Appraisal Forms The performance appraisal forms are divided into three types 1. Performance Appraisal Form for JO and Executives in the grades E0 and E1. (Yellow in colour). 2. Performance Appraisal Form for Executives in the grades E2, E3 and E4. (Blue in colour). 3. Performance Appraisal Form for Executives in the grades E5 and above. (White in colour).

General Guidelines of Appraisee. 1. Link your with performance targets and objectives set for the review period .If performance targets and objectives have not been set formally ,the appraisee should mentioned her/his achievements. 2. The self appraisal is meant to facilitate the total performance appraisal process. Your appraiser will treat this as an input to your appraisal. 3. Please be informative and candid in your responses to the questions. This would the appraiser ,reviewer and the organization as a whole. 4. Use additional sheets if necessary

The guidelines for filling up performance appraisal for the purpose of job. For the appraisal of non-executives i.e., workman, a single form issued consists of two pages. The first page describes the details of employees and the brief description of the job assigned to the employees. The second page consists of actual performance appraisal which is known as annual confidential report(ACR).Describe the details of the employees and brief description on the nature of duties and functions of the employees, namely as follows :A) Activities ,B)Responsibilities C) Demand and constraints D) Characteristics .The employees is rated in 8 dimensions1.Excellent 2.Very good 3. Good 4. Satisfactory5. Poor. There are 8 dimensions as follows. 1. Health 2.Knowledge of the job. 3. Mental alertness. 4. Loyalty 5.Conduct and punctuality 6.Methods and Techniques of working 7. Potentiality for development 8. Honesty and integrity .The performance appraisal will be done at the end of the year and duly signed by both appraisal and the appraisee.i.e,(reporting officer and the reviewing officer)

A copy of the form used in annexure -11,there are certain guidelines issued to the assessors to fill the form, which is as follows: 1. The form should be treated as confidential and should be returned in sealed envelope to the personnel department. 2. The form is to be filled in ink only 3. Assessment should be indicated by a tick( -/) in the appropriate place 4. Please do not begin assessment unless you have read this guide recently 5. No attempt should be made to arrive as a pre-decided score. Consider each trait separately.

6. The individual being assessed should be compared with others of the same rank employed on the same type of work. 7. Indicate your judgement of the persons being rated by considering each of them carefully and accurately. 8. 9. Do not make a snap judgement. Consider one factor at a time and rate all the persons against that factor before passing onto the nest factor. 10. Do all your rating preferably at one sitting, otherwise it may be difficult to get a comparative picture. 11. You are doing the rating, please do not discuss it any anyone. If your subordinate is to do the rating, do not encourage him to do the rating with you. 12. Do not allow personal feelings to govern your rating. 13. While assessing a subordinate call to mind instances that are typical of his work and ways of working. Do not judge only on most recent cases. Do not be influenced by unusual cases which are not typical 14. Too high a rating lowers the value of the assessment. The reporting officer's capacity for sound judgement is compromised and those being assessed are prejudiced since the assessment is known to be faulty. 15. The reviewing officer should not rate any item which is not applicable or which he has not had the opportunity to judge .He should consult the immediate superior of the employee concerned, in the cases where he has no personal knowledge of an employee work etc. 16. Use the remarks column in the last for any amplifications, additions or amplifications. Note any special aptitudes or qualities, record a brief summary or the job progress review with employee including your favourable comments as well as your reprimands, warnings or comments on his short-comings of failures and please note any action you recommend.

17. While assessing the employee for potentially for development, the following points should also be taken into account.

1. House keeping. 2. Cost consciousness. 3. Willingness to learn and take criticism. 4. Organizing ability. 5. Co-operation. 6. Willingness to accept responsibility. If the employees wants to promote to the next higher level, consecutive to the previous three ACR's is considered.

General Guidelines for Appraisers 1. The form, should be treated as strictly confidential and should be returned in a sealed envelope to the Personnel Department. 2. The form is to be filled in ink only. 3. Assessment should be indicated by a tick(-/)in the appropriate place. 4. Please do not begin assessment unless you have read this guide recently. 5. No attempt should be made to arrive at a pre-decided score. Consider each dimension separately. 6. Indicate your judgement of the persons being rated by considering each dimension separately. 7. Do not make a snap judgement. 8. Do not allow personal feelings to govern your rating. Remember that rating which is not objective reflected upon the integrity of the appraiser.

9. While assessing a subordinate, call to mind instances that are typical of his work and ways of working. Do not judge only on most recent cases. Do not be influenced by unusual cases which are not typical. 10. Too high a rating lowers the value of the assessment. The appraiser's capacity for sound judgement is since the assessment is known to be faulty.

SECTION A A1)PURPOSE OF THE JOB: This is to be in the nature of a single statement outlining the primary purpose of the job assigned. It also defines the key performance areas of the job which have been agree between the appraisee and the appraiser at the beginning of the year .This exercise is critical as it not only directly individual efforts towards organizational goals but also provides a role clarity to the employee. . A2) OBJECTIVE SETTING At the beginning of the year, clearly spelt out objectives must be agreed upon between the appraisee and appraiser .The objectives will evolve from the key performance areas already outlined. Objectives must include quantity, time ,quality and cost wherever applicable and must be stated such as that the criteria by which achievements can be measured is clear. Routine activates should not be listed as objectives. Emphasis must be placed on team objectives. This section would be filled up under the guidance of the appraiser in line with the organizational objectives. Though arrived at after mutual discussions between the appraiser and the appraisee , the act of writing the appraiser would however guide even the language used. Objectives must be reviewed at least once every months and modified according to changing situation, if needed.

ANALYSIS OF ACHIEVEMENTS At the end of the appraisal period, the achievements should be analyzed by both the appraiser and the appraise together .The means/process by which the objectives were achieved should be analyzed carefully .It is important to distinguish the individual's contribution towards achieving the objectives .The situation ,the facilitating factors and constraining factors should also be taken into consideration. SECTION B (For JOs., and Executives in the grades E0 and E1) This section is introduced to assess the appraisee on areas ,which do not figure directly in objectives but are functionally very important .There are several aspects of performance where such an appraisal would most likely reflect the reality .A simple rating on a 5 point scale by the appraiser on the following factors would be useful.

1.

Communication : Proficient in oral and written communication persuasive in speech, possess presentation skills ,positive contribution in meetings.

2.

Interpersonal Relations : Ability to get along with people ,ability to create cordial and congenial atmosphere at work ,ability to infuse trust.

3.

Analytical Ability : Ability to think logically ,explore various dimensions of any issue and go to the core of the problem.

4. Systematic Approach : A sense of orderliness at work, and strict adherence to procedural steps. 5. Conduct : Acceptable behaviour in the organizational context. 6. Sincerity : Willingness to give the best, single mindedness, hardworking. 7. Initiative : willingness to take up higher/additional responsibility ,willingness to exert greater effort without having to compel or persuade.

8. Team work : Ability to interact with others to accomplish overall group goals, openness, mutual respect and interdependence. 9. Creativity : Ability to generate novel and realistic alternative solutions, ability to perceive and employ innovativeness to utilize them. 10. Integrity : Willingness to adhere to written and unwritten norms of work above board. 11. Quality Consciousness : High standards of performance ,thoroughness, accuracy, clarity and general excellence of output. 12. Cost Consciousness : Effort towards optimum utilization of a available resources. 13. Safety Consciousness : To be aware of safety regulations applicable and willingness to adhere to. 14. Result Orientation : Focussing on means and outcomes related to work. 15. Discipline : respecting and following organizational rules and regulations, policies and unwritten norms of conduct and behaviour. 16. Dependability : Assumes responsibility, infuses confidence, can be relied upon to complete assigned tasks with minimal follow up. 17. Crisis Management : Handles crises without affecting routine matters, managers ambiguity without getting ruffled.

SECTION B ( For Executives in the grades E2, E3 and E4) This section is introduced to assess the appraisee on areas which do not figure directly in objectives but are functionally very important.There are several aspects of performance where such an appraisal would most likely reflect the reality. A simple rating scale on a 5 point scale by the appraiser on the following factors would be useful. 1. Communication : Proficient in oral and written communication persuasive in speech, possess presentation skills ,positive contribution in meetings.

2. Interpersonal Relations : Ability to get along with people ,ability to create cordial and congenial atmosphere at work, ability to infuse trust. 3. Result Orientation : Focussing on means and outcomes related to work.

4. Analytical Ability : Ability to think logically ,explore various dimensions of any issue and go to the core of the problem. 5. Decision Making : Ability to go to the core of the problem, analyse and take correct and effective decisions. 6. Leadership : Willingness to assume responsibility, influence the activities of group towards goal achievements ,motivates and inspires team members. 7. Initiative : Willingness to take up higher/additional responsibility, willingness to exert greater effort without having to compel or persuade. 8. Team work : Ability to interact with others to accomplish overall group goals, openness, mutual respect and interdependence. 9. Creativity : Ability to generate novel and realistic alternative solutions, ability to perceive and employ innovativeness to utilize them. 10. Integrity : Willingness to adhere to written and unwritten norms of work above board. 11. Quality Consciousness : High standards of performance ,thoroughness, accuracy, clarity and general excellence of output. 12. Cost Consciousness : Effort towards optimum utilization of a available resources. 13. Systematic Approach : A sense of orderliness at work , and strict adherence to procedural steps. 14. Flexibility : Nonbelievers in status - quo ,flexible approach towards unusual problems and situations, genuinely accepts changes when necessary. 15. Problem Solving Ability : Ability to understand, analyze and find out alternative solutions systematically.

16. Emotional Resilience : Ability to withstand stresses and strains of work , placid temperament , calm and collected 17. Crisis Management : Handles crises without affecting routine matters, managers ambiguity without getting ruffled.

SECTION B ( For Executives in the grades E5 and above). This section is introduced to assess the appraisee on areas which do not figure directly in objectives but are functionally very important. There are several aspects of performance

where such an appraisal would most likely reflect the reality. A simple rating scale on a 5 point scale by the appraiser on the following factors would be useful. 1. Communication : Proficient in oral and written communication persuasive in speech, possess presentation skills, positive contribution in meetings. 2. Interpersonal Relations : Ability to get along with people, ability to create cordial and congenial atmosphere at work ,ability to infuse trust. 3. Integrity : Willingness to adhere to written and unwritten norms of work above board. 4. Flexibility : Nonbelievers in status - quo ,flexible approach towards unusual problems and situations, genuinely accepts changes when necessary. 5. Decision Making : Ability to go to the core of the problem, analyze and take correct and effective decisions. 6. Leadership : Willingness to assume responsibility, influence the activities of group towards goal achievements ,motivates and inspires team members. 7. Cost Consciousness : Effort towards optimum utilization of a available resources

8. Team Building : Coaches ,counsel's and develops team members, coordinates the efforts of individual group members.

9. Creativity : Ability to generate novel and realistic alternative solutions,ability to perceive and employ innovativeness to utilize them. 10. Emotional Resilience : Ability to withstand stresses and strains of work , placid temperament , calm and collected. 11. Perspective : Ability to look beyond narrow work boundaries, appreciate role function/department in the larger organizational context, think long-term. 12. Quality Consciousness : High standards of performance, thoroughness, accuracy, clarity and general excellence of output. 13. People Orientation : Assumes responsibility for people working in his team, concern for the individual, respecting dignity of individual, humane approach. 14. Initiative : Willingness to take up higher/additional responsibility, willingness to exert greater effort without having to compel or persuade. 15. Result Orientation : Focusing on means and outcomes related to work. 16. Openness : Putting forward and willingness to accept the true picture 17. Mentership : Guiding and counselling to help the subordinates. 18. Problem Solving Ability : Ability to understand, analyze and find out alternative solutions systematically. Overall Rating for Section B Use the following values :
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Barely adequate (BA ) Satisfactory (S) Good (G) Very good (VG) Outstanding (O)

: : : : :

1 2 3 4 5

Use Formula to arrive at Index

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Rating for section B = { 1x(no of factors with 'BA' rating) +2x(no of factors with 'S' rating) +3x(no of factors with 'VG' Note : rating)+5x(no of factors with 'OS' rating)/ [total no of factors]*

'*'Total no. of factors = 12, if you have not used any additional(optional)factors. OR =12+no. of additional (optional) factors used.

Round off index to nearest second decimal position and use following table to arrive at over all rating for section B Less than or equal to 1.49 1.5 to 2.49 2.5 to 3.49 3.5 to 4.49 - BA - S - G - VG

Equal to or greater than 4.5 - OS

SECTION C Overall Assessment. The overall assessment of the performance of the appraisee, based on sections A,B and form 2 should be done on a rating on a 5-rating scale as per the guidelines provided .The rating has to be done by the appraiser .reviewer has to record his comments. Record of the Interview The overall rating has to be discussed by the appraiser with the appraisee. A record of the discussions should be made. This section should also record any differences in perception regarding the performance and the reasons thereof.

Guidelines for Rating This section relates to the present job during the preceding year and not to the assessment of potential. The rating must emerge from what has been stated in sections A,B and C.

1. Barely Adequate Performance

y y y

Has only partially achieved objectives and not with effective utilization of resources. Needs to be pushed Can improve substantially

2. Satisfactory Performance
y

This implies full performance of allotted responsibilities and achievements of expected standards

3. Good Performance
y

Exhibits a good amount of self-reliance and can be depended on for results without any supervision.

4. Very Good Performance

y y

Performance which is over and above the allotted responsibilities and expected results. Something extra in the form of higher output of efforts ,better quality or insight and improvements in systems.

5. Outstanding Performance
y

Has exhibited through performance, complete mastery of the present job.

Is a resource of the organization beyond his present assignment particularly in the building of the people and systems.

A high level contributor to organizational results and displaying a outstanding qualities.

SECTION D Identification of strengths and areas of improvements / evolving a development plan After analyzing sections A,B,C and Form 2,the appraiser and the appraise together should identify the appraisee's strengths and areas requiring improvements with respect to the specific competencies required for the job. Based on this a specific development plan should be generated for the year. This may cover training inside or outside the organization, study visits ,readings.

SECTION E

Potential Appraisal (This section is not to be discussed with the appraisee) Identifying the appraisee's potential must be done by the appraiser on the basis of:
y

Skills ,knowledge and behaviour as exhibited in the past year while achieving the objectives, as laid down in the section A

y y

Strengths and areas for improvement as identified in section D. Analysis of what the next higher job/totally different job(for which he might be considered)entails: the requirement in terms of skills ,knowledge, attitude and behaviour. (Some guidelines for potential appraisal are suggested below)

The increment and promotion columns are to be filled by the reviewer after discussions with the appraiser .The reviewer should record his comments on the performance of the individual and the future development plans for him ,etc. Some guidelines for Potential review (which are not exhaustive) are suggested below: 1. 2. 3. 4. 5. 6. Does he show consistent performance over standard acceptable norms? Does he has the ability to evaluate and take independent action? Does he display foresight in planning, with timely action? Has he the adaptability and flexibility to effectively deal with unfamiliar work? Does he have the ability to make himself understood and to understand others? What are the requirements of the next higher job or totally different job for which he may be considered. 7. 8. 9. 10. 11. 12. What was his performance whilst acting in a higher job? Does he remain calm and clear under stress and strain? As leader ,does he inspire a high level performance from his team? Does he really enjoy the credibility ,trust and respect of others? Does he focus on the development of his subordinates? Is he an ardent believer in time synergy?

General guidelines for Appraisers 1. The form should be treated as strictly confidential and should be returned in a sealed envelope to the personnel department 2. The form is to be filled in ink only. 3. 4. 5. Assessment should be indicated by a tick (-/) in the appropriate place. Please do not begin assessment unless you have read this guide recently. No attempt should be made to arrive at a pre-decided score. Consider each dimension

separately. 6. Indicate your judgement of the persons being rated by considering each dimension separately 7. Do not make a snap judgement.

8. Do not allow personal feelings to govern your rating. Remember that rating which is not objective reflected upon the integrity of the Appraiser. 9. While assessing a subordinate, call to mind instances that are typical of his work and ways of working. Do not judge only on most recent cases. Do not be influenced by unusual cases and which are not typical 10. Too high a rating lowers the value of assessment. The Appraiser's capacity for sound judgement is since the assessment is known to be faulty.

Review Levels There shall be only two levels of Appraisal and Review: First : The Immediate Reporting Officer(The appraiser)

Second : The Reviewer (The officer of whom the appraiser reports)

With the following conditions .

y

The appraiser and reviewer shall not be from the same category. The categories being: Category 1 : JO, E0 and E1 Category 2 : E2, E3 and E4 Category 3 : E and above

For all the personnel in the grades E4 and above ,Project Head/concerned G.M to be the reviewer.

For all the personnel where the Project Head/Concerned G.M is the appraiser,the concerned director would be the reviewer.

For personnel in category 1(grades JO, E0,E1),the appraiser will not a person below E2 grade

No review for half-yearly appraisal. Role of the Reviewer

y y

Reviewer would look for objectively in assessment In case of differences in perception between appraiser and reviewer shall appraiser for any change.

The reviewer can modify the rating of appraiser but by not more than one point on either side on 5-point rating scale.

In all cases of disagreement between appraise and the appraiser ,the reviewer shall meet the appraise. Review Committee

There would be two review committees- one at each project and one over all for NMDC at corporate Project level:

This committee would be headed by the Project in-charge and members would be drawn from heads of the departments.

The committee would review all the appraisal forms JO-E4 would have the authority to change the rating in any single point on either side of 5-point rating scale.

This committee would ensure that the performance appraisal system is administered fairly and without any individual biases/prejudices. Corporate Level:

Review committee would be a cross project committee.

Would contain approximately 10 members, all project heads, few GMs for HO and atleast one director.

Would look into individual appraisals of personnel in grades E5 and above and will have the authority to change any individual rating by one point on either side on 5-point rating scale.

y y y y y y y

In other cases would monitor Tends Process of appraisal Objectivity Standards Cases where the project head had to change the rating of the appraiser Act as a conscience keeper for the performance management process, with focus on the end objectives.

Would counsel the various project head/GMs to ensure the success of the process both in letter and spirit.

Step in Implementation Beginning of the year :

1. The appraisee fills up section A1 and hands it over the same to the appraiser. 2. The appraiser and the appraisee meet and agree upon A1 and then together fill up section A2 (objectives only) .

End of the Year

1. Self appraisal (Form 2) is filled by the appraiser and handed over to the appraiser.

2. Analysis of achievements (Section A2) is completed together by the appraiser and the appraisee. 3 Appraiser complete Section B,C1 and discusses the same with the appraisee.

4. The comments of the appraisee are recorded in section C2. 5. Section D is filled by jointly by the appraiser and the appraisee. 6. Section E is filled by the reviewer along with the appraiser .This section is not shown to the appraisee .

QUESTIONNAIRE 1. Are you aware of the Performance Management System in NMDC? a)Yes 2. b)No

Do you know the factors on which performance is appraised? a)Yes b)No

3. How do you rate the overall assessment of performance appraisal? a)Outstanding b)Very good c)Good d)Satisfactory e)Barely adequate

4. How do you rate the transparency of performance appraisal system of the company? a)Outstanding b)Very good c)Good d)Satisfactory e)Barely adequate

5. How well is performance management system implemented in your organization? a)Outstanding b)Very good c)Good d)Satisfactory e)Barely adequate

6. Are the goals clearly specified? a)Yes b)No

7. In your opinion does performance management system of the company identifies the training needs? a)Yes b)No

8. Is the promotional policy well defined in your organization and is linked with performance appraisal system? a)Yes b)No

9. Does the organizational support provided to you leads to improve your performance level? a)Yes b)No

10. In your opinion does the facilitating and the hindering factors had a negative/positive impact on your performance? a)Yes b)No

11. According to you , what is the way the performance management system helps you?

a) Improving yourself c) Maintain good relations

b) Setting higher goals

12. Is organization adapting self-appraisal concept? a) Yes b) No

13. In the event of disagreement have you been given an opportunity to discuss and represent yourself? a)Yes b) No

14. Does organization provide counselling after the appraisal is done a)Yes b)No

15. Does the company clearly communicates its goals and strategies to you a)Yes b)No

16. How often the performance appraisal form filled or performance appraisal is done? a)Quarterly b)Monthly c)Half Yearly d)Annually

17. What according to you would be the best way to reward the employees? a)Through cash rewards c) Skilled based incentives b) Profit sharing incentives d) Fringe benefits

18. Do you agree that the appraise should be allowed to participate in appraisal? a)Yes b)No

19. In the last year have you had opportunities to learn and grow? a)Yes b)No

20. How do you rate your performance management system? a)Outstanding b) very Good c) Good d)Poor

LIMITATIONS

1. NMDC is a multispread organization having divisions ,mines and projects at different locations throughout the country. It is not possible to visit each location to carryout the study. 2. However, most of the employees working in corporate office of NMDC ltd are from different projects located at different locations 3. Time period was the major limitation of the study 4. Due to shortage of time the employees in the organization were not studied properly.

5. The study was limited to 50 employees within that unit. 6. The findings of the study are solely based on the information provided by the respondents. 7. The accuracy of the findings are limited by the accuracy of the statistical tools for analysis. 8. Findings of the research may change due to area, demography etc.

RECOMMENDATIONS / SUGGESTIONS

I.

Introduce a good feedback

system to make necessary improvements in the levels of

performance of employees in the organization. II. The employees should be given feedback on their performances periodically. This may help in the improvement of their performance for the better results in future. III. The company should establish a good performance management system which will be appreciated by the employees and also retain them in the company with a the zeal and zest. IV. V. Employees should be appraised once in six months. While discussing and clarifying the areas of performance to the employees it should be mentioned that not only the performance of employees are considered during but also other factors such as his/ her attitude ,training needs ,strengths ,weaknesses responsibilities ,etc. VI. Performance management emphasizes that performance is the responsibility of both supervisor or appraiser and the appraise or supervisee, and both of them should own the system. VII. Employees doing good work should be rewarded, to enhance their contribution in future.

CONCLUSION I. It can be concluded that performance management system in NMDC is in accordance with the developing phase .Effective governance i.e.,work culture ,environment of work etc. II. The factors considered during the appraisal system should not be based on performance but also on other factors. III. An effective feedback system between the company and the appraise place a vital role in the appraisal system which goes a long way and will have an immediate effect that shows positive results.

BIBLIOGRAPHY 1. T.Venkateshwara Rao and T.V Rao, Performance Management and Appraisal system. Sage Publications India Pvt Ltd, 2005.

2. Michael Armstrong , Armstrong Handbook of Performance Management, Viva Books Publisher,4th Edition.

3.

C.B Memoria and Gankar S V , A Text Book of Human Resource Management. Himalaya Publishing House,2004.

4.

James W. Smither and Manuel London ,Performance Management. Published by jossey-Bass,2009.

5. Michael Armstrong and Angela Baron, Managing Performance. Published by Chartered Institute of Personnel and Development ,5th Edition.

Websites : www.nmdc.co.in. www.google.com. www.wikipedia.org.