Impact of Performance Appraisal System on Productivity of Employees of ONGC Ltd

Presented by: Nisha Sharma Roll No: 175 Deepa Khastogir Roll No: 178

Introduction

Performance appraisal can be defined as the process of evaluating the performance of an employee & communicating the result of the evaluation to him for the purpose of rewarding & developing the employee. According to Michael Armstrong Performance appraisal is a formal assessment & rating of individual by their managers at usually at annual review meeting. Performance can be defined as the degree of accomplishment of tasks by an employee in his job. In some organizations it is measure of the result achieved & target accomplished whereas in others, it is a measure of employee efforts & behavior. However most organizations use a combination of both efforts & results. Performance appraisal is also termed as performance review, annual review & annual appraisal

THE APPRAISAL PROCESS

Determination of standard of performance Measurement of employees performance It is a continuous process with a feedback Communicating the result with employees Finally there should be an effective use

PERFORMANCE APPRAISAL METHODS

1. Management by objective or goal setting.
2. Graphic rating scale. 3. Work standard approach. 4. Essay appraisal. 5. Critical incidence method. 6. Forced choice rating method 7. Point allocation method. 8. Ranking method. 9. Check list 10. Behavioral anchored rating scale. (BARS) 11. 360 degree performance appraisal. 12. Team appraisal. 13. Balanced scorecard method.

CASE STUDY ON ONGC

Objective : i) To know the various types of performance appraisal methods being used at ONGC Ltd.

ii) To know which appraisal system is being mostly used in ONGC Ltd.

iii) To know whether the performance appraisal system of ONGC Ltd increase the productivity of employees or not

Scope of the study: Bandra, Mumbai ONGC Population of the Study: People working with ONGC Sample Size: 100

RESEARCH METHODOLOGY
The approach used for the study was Survey Method. For this Literature and Diagnostic Survey were carried out: LITERATURE SURVEY In-house journals, magazines, reference books, manuals and the other related sources. DIAGNOSTIC SURVEY It was done with the help of a questionnaire to check the efficiency and effectiveness of the system.

METHOD OF DATA COLLECTION

PRIMARY DATA: Questionnaire SECONDARY DATA: manuals, journals and intra net, web sites, and the final data was analyzed systematically to achieve the desired result.

Tools of Data Analysis: The statistical tool used is Chi-square test in this study.

RESEARCH DESIGN

The present study identifies views of employees of different levels and disciplines. Divided the whole sample into various groups: Age Experience Departments Levels

PERFORMANCE APPRAISAL SYSTEM AT ONGC LTD

Objectives:

To set norms and targets and monitor the work progress.

To facilitate placement of employees To determine merit, efficiency and suitability for the purpose of promotion. To identify areas requiring exposure for training and development.

Procedure
The appraisal system used in ONGC is the oldest one. It is three tier system, evaluating in three stages.

By the Reporting Officer under whom employee is working. By the Reviewing Officer. By the Accepting Officer Self-Appraisal is also there

The PAR of executives will be submitted to concern functional Director for final review and acceptance. The PAR of executives will be equally reviewed by the Director concerned. The PAR of the executive would be reviewed by the functional head/GM/CGM

Analysis of Data
Significant variables Individual feedback should be provided after the appraisal The management helps provide an atmosphere where all are encouraged foe teamwork & comradeship My superior appreciates me when I do a good job My appraiser knows my personality ,talents & potentials Rater has the ability & courage to give constructive criticism in a friendly, firm & positive manner 69% 31%
YES NO

87 %

13%

86% 87%

14% 13%

67%

33%

The employees are provided with the opportunity to respond to the feedback of the appraisal Are you rated on your competencies- Knowledge, skills& attributes There should be some incentives based on the individual & group performance Are you provided with the genuine feedback Do you find appraisal counseling beneficial for future developments Do you think management take a serious note of training requirements shown in the appraisal Do you want the system of 360 degree appraisal in which you can appraise your superior

37%

63%

72%

28%

88%

12%

27% 77%

73% 23%

38%

62%

73%

27%

CHI-SQUARE
Attribute Feedback Atmosphere Appraisal counseling Incentives 360 degree appraisal system Total Yes 46 49 21 34 8 158 No 3 0 28 15 41 87 Total 49 49 49 49 49 245

O(OBSERVED) E(EXPECTED)
46 49 21 34 8 3 0 28 15 41 31.6 31.6 31.6 31.6 31.6 17.4 17.4 17.4 17.4 17.4

O-E
14.4 17.4 -10.6 2.4 -23.6 -14.4 -17.4 -10.6 -2.4 -23.6

(O-E)2
207.36 302.76 112.36 5.76 555.96 207.36 302.76 112.36 5.76 556.96 Total (CH1)

(O-E)2/E
6.56 9.58 3.55 0.18 17.625 11.917 17.4 121.4 0.33 31.99 220.53

Variables: Performance appraisal Productivity Ho: Performance appraisal system in ONGC does not affects the productivity of employees. H1: Performance appraisal system in ONGC affects the productivity of employees. Degree of freedom = (row-1) (column-1) = (5-1)*(2-1) = 4*1 = 4 Row = 5 Column = 2 Significance = 0.05 Table value = 9.49 Chi- square = 220.53 The Value is Accepted

MAJOR FINDINGS

Performance Appraisal System in ONGC is not transparent. Appraisers are usually unbiased Relations with the superior affect the evaluation. Greater weightage is given to the recent performances. There are fixed standards to evaluate the performance but those are not clear due to the subjectivity of the topic. Superior-subordinate relations are good. Superior helps them set and achieve meaningful goals. This makes the environment cordial and agreeable.

Employees dont have the opportunity to respond to the appraisal result. Performance appraisal sheet is lucid and easy to understand and fill. The parameters used to appraise the potential are ample. The system being not so transparent, employees are unable to identify the performance gaps in order to prepare for the future.

The management helps provide an atmosphere where all are encouraged for teamwork.
Most of the raters have the ability to give constructive criticism in a friendly, firm and positive manner.

Employees are being rated on their knowledge and skills. Majority of people want that there should be some incentives based on performance. Employees are not provided with the genuine feedback. Management doesnt bother much about the training requirements mentioned in the appraisal sheet. Most of the employees want that 360o feedback system should be introduced.

RECOMMENDATIONS

The system should be made more transparent. Discussion between appraiser and appraisee before the Appraisal process. The genuine feedback should be provided to the employees. The raters should always consider the performance as the only measure for the evaluation The raters should take note of the critical performance incidents and it should not be that only the recent performances are given more weightage. Necessary skill should be set to do the job more efficiently, set the goals as per the potential and caliber of the individual.

Employees should have the opportunity to respond to the appraisal result. For this individual feedback should be provided.
Management should take serious note of the training requirements Some incentives should be introduced on the performances basis.

Thank You