13 - ZIJMR - Vol2 - Issue5 - May 2012

ZENITH
International Journal of Multidisciplinary Research

Vol.2 Issue 5, May 2012, ISSN 2231 5780
AN ANALYTICAL STUDY OF PERFORMANCE APPRAISAL SYSTEM

OF THE SELECTED INFORMATION TECHNOLOGY ENABLED
SERVICES (ITES) COMPANIES
SHREYA RUSTUM VIRANI*
*Assistant Professor,
Jayawantrao Sawant College of Engineering,
Pune, Maharashtra, India.
ABSTRACT
In recent years, performance management has become more important because managers are
under constant pressure to improve the performance of their organisations. It is now realised that
the performance of organisations influence the organisations continued existence and success.
The increasing realisation that one of the key roles of managers is to manage employees
performance is the key to the success of management in general and performance management in
particular. It is now well accepted that performance management is a wider concept than
performance appraisal. Appraisal being part of performance management plays a vital role in
encouraging desirable performance and discourages undesirable performances before they
become ingrained. Performance appraisal is a systematic and objective way of judging the
relative worth or ability of an employee in performing his job.
With above aim in view, the researcher has made an attempt in this work to gather and critically
examine the valuable inputs from various representative ITES companies and carry out a
deductive/inductive analysis of the qualitative and quantitative data for arriving at desired
results. The researcher has done detailed analysis of performance appraisal system of the selected
ITES companies. This research comes up with a view that the respondents of the selected ITES
companies are in agreement with their existing performance appraisal system.
Due to rapid globalisation of world economy, the context and paradigm of performance in the
organisational perspective has undergone sea change. Organisations now have to face
competitive pressures, uncertainty, and dynamic environment and above all rising expectations
of the customers that includes the external as well as internal customers. These factors have
compelled organisations to manage performance of employees for achieving and sustaining their
competitiveness. Performance is a behaviour that leads to results. Performance of an employee
does not happen in isolation or without adequate reason. There are casual factors which include
employee to perform better. Such factors are motivation, leadership, reward and compensation
system, promotion system, training and development etc.
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INTRODUCTION
www.zenithresearch.org.in
KEYWORDS: Performance Management, Performance appraisal system, Case study, ITES

Companies.
______________________________________________________________________________
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Armstrong (2005) describes the role of performance appraisal as a tool for looking for-ward to
what needs to be done by people in the organisation in order to achieve purpose of the job, to
meet new challenges, better use of technology skills and attributes. In addition it will develop
both organisational and individual capabilities and reach agreement on areas where performance
needs to be improved.
According to Dessler (2002), performance appraisal is defined as evaluating an employees
current or past performance relative to his or her performance standards. It therefore involves the
following:
Setting a work standard
Assessing the employees actual performance relative these standards.
Providing feedback to employee with the aim of motivating that person to eliminate
performance deficiencies or to continue to perform above par.
Performance appraisal aims to determine the relationship between the individual effort and
results, as well as between individual results and the attainment of organisational goals and
objectives. There is no ideal or standardized performance appraisal procedure since its scope
depends mainly upon the organisational goals and objectives and the purpose of the appraisal, as
well as on the skills of the appraisers and on the appraisal methods involved.
In the present paper some live case studies of selected ITES companies have been taken and their
performance appraisal systems with reference to its practices and processes have been evaluated.
LITERATURE REVIEW
OBJECTIVES
1. To critically examine the Performance Appraisal Systems of ITES companies with
reference to its practices and processes at the different levels.
2. To draw the necessary findings in the light of the data analysed and interpreted.
136
The performance appraisal is essentially a formal mechanism of reviewing individual employee

performance. Fletcher (2001) defines it as the activities through which organisations to assess
employees and develop their competence, enhance performance and distribute rewards.
Performance appraisal is a well-established way of providing milestones, feedback, guidance and

monitoring for staff. A further development is tying this appraisal into a larger and more
complex system of performance management (Weightman,1999). CIPD (2008d) support the
view that whilst performance appraisal is an important part of performance management, it is
only one tool amongst a range of tools that can be used to manage performance.
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CASE STUDY
In the present paper the selected ITES (Information Technology Enabled Services) Companies
from Pune region namely ZS Associates Ltd., Tata Consultancy Services (TCS), Infosys, IBM,
Patni, have been taken for study. The existing Performance Appraisal System of these selected
ITES companies has been critically examined. The data required for this purpose has been
extracted through well-structured questionnaires
DATA COLLECTION AND SAMPLING
In order to fulfil the above mentioned objectives and to meet the requirement of the research the
data has been collected in the following ways:
PRIMARY DATA
QUESTIONNAIRE: Comprehensive structured questionnaire was designed for collecting the
data. The questionnaire was designed for the managers and executives working at the middle and
top level of management in ITES companies.
DIRECT INTERVIEW: The required information for the present research has been acquired
through direct interview of the officials working at the top management; the study has been
conducted objectively. The interviews were taken in an unstructured form and further analysis /
outcome has been suitably presented
SAMPLING FRAME
The list of the ITES companies was taken from the yellow pages, which served as the frame for
the purpose of the study. This provided the complete list and companies were taken into
consideration from the same.
SAMPLE PLAN
The total numbers of companies selected are 5. From each company random selection of 12
employees is done.
LIST OF THE SELECTED ITES COMPANIES
In the present paper, the following companies have been taken for the study.
137
Stratified sampling method was used to design sample. From the selected ITES companies, the
respondents were categorized into Managers or Executives working in these companies and
employees working under them. Random sampling was used to collect the data. The lists of
persons working in these companies were taken and randomly respondents were selected to
collect the data.
SAMPLING TECHNIQUE AND SAMPLE SIZE
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ZS Associates Ltd.,
Tata Consultancy Services (TCS),
Infosys,
IBM India Pvt. Ltd.
Patni Computer Systems
RESEARCH METHODOLOGY
METHOD OF ANALYSIS AND TOOLS USED
Filled up questionnaires were examined for their correctness and observed gaps were mitigated
through follow up with the respondents. In the current research work, data related to research
topic was fed to the SPSS (Statistical Package for Social Sciences), and then various operations
were performed. Data analysis was done by using various statistical techniques such as
frequency, multiple responses, mean etc. in order to draw meaningful findings and conclusion.
DATA ANALYSIS AND FINDINGS
In the light of the above objectives stated the data analysis is presented in tabular format
[Table No. 1 to Table No. 6].
TABLE NO. 1: CRITERIAS CONSIDERED FOR PERFORMANCE APPRAISAL IN
THE SELECTED ITES COMPANIES
Criteria
ITES Companies
ZS
Associates
TCS
Infosys
IBM
Patni
(%)
(%)
(%)
(%)
12
12
--
10
10
Ability of meeting defined

standards
14
14
--
--
--
Ability to meet deadlines
12
12
--
--
--
Output/Result of employees
25
25
25
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Achievement of Objectives
(%)
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Attitude towards the work
10
10
Core competency
15
15
30
30
30
Commitment
15
Technical Knowledge & Skills
15
15
30
25
25
Competency level
15
15
--
--
--
Total Percentage
100
100
100
100
100
Source: Survey
Ratings given by the respondents to the various aspects of their performance appraisal system
(PAS)
TABLE NO. 2: ZS DESCRIPTIVE STATISTICS
Item
Minimum
Maximum
Mean
Std.
12
3.7500
.86603
Feedback Mechanism
12
3.250
1.3568
Performance Review Process
12
3.7500
45227
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Process of communicating
performance standards
Deviation
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Clarity of Performance
appraisal System
12
2.0000
1.27920
Transparency of Performance
appraisal System
12
3.0000
1.04447
Valid N (listwise)
12
(Source: Survey)
Here the respondents were asked to rate the various aspects of their performance appraisal
system, where 1= poor, 2 = average, 3= good, 4= very good 5= the best.
While analysing these parameters the mean of the rating if it is above 0.5 percent then only it is
taken to the next rating (for e.g. if the mean comes 1.9 here rating received is somewhere
between 1&2 but it will be taken as 2, if the mean comes 1.4 here rating received is somewhere
between 1&2 but it will be taken to 1)
From the above analysis it is clear that the ratings given by the respondents to the process of
communicating performance standards and performance review process is somewhere between 3
to 4 hence it can be said that respondents view process of communicating performance standards
and performance review process as very good. Whereas a rating given for feedback mechanism
and transparency of performance appraisal system is 3 hence it is clear that respondents view
these two aspects of performance appraisal system as good. Rating given to clarity of
performance appraisal system is 2; which indicates that respondents view it as average.
TABLE NO.3: TCS DESCRIPTIVE STATISTICS
Item
Minimum
Maximum
Mean
Std.
12
4.0000
.00000
Feedback Mechanism
12
3.417
.5149
12
3.5000
.90453
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Deviation
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appraisal System
12
4.0000
.00000
appraisal System
12
3.5000
.90453
Valid N (listwise)
12
(Source: Survey)
between 1&2 but it will be taken to 1).
From the above analysis it is clear that the ratings given by the respondents to the process of
communicating performance standards and clarity of performance appraisal process is 4 hence it
can be said that respondents view process of communicating performance standards and clarity
of performance appraisal as very good. Whereas a rating given for performance review process
and transparency of performance appraisal process is somewhere between 3 and 4 hence it can
be said that respondents view these two aspects of their performance appraisal process as very
good. Rating given to feedback mechanism indicates that respondents view it as good.
TABLE NO.4: INFOSYS DESCRIPTIVE STATISTICS
Item
Minimum
Maximum
Mean
Std.
12
4.0833
.51493
Feedback Mechanism
12
3.417
.5149
12
3.417
1.07309
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Deviation
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appraisal System
12
4.1667
.57735
appraisal System
12
3.5000
1.16775
Valid N (listwise)
12
(Source: Survey)
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From the above table it is evident that, the ratings given by the respondents to process of
communicating standards and clarity of performance appraisal system is 4; hence it shows that
respondents view these two aspects of performance appraisal system as very good. Whereas the
ratings received by the feedback mechanism and performance review process fall between 3 and
4 which clearly indicates that according to respondents feedback mechanism and performance
review process of their complete appraisal process is good while respondents have rated
transparency of PAS somewhere between 3 and 4; hence it is assumed that respondents view it as
very good.
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TABLE 5 : IBM DESCRIPTIVE STATISTICS

Item
Minimum
Maximum
Mean
Std.
Deviation
12
3.9167
.28868
Feedback Mechanism
12
3.417
.5149
12
3.5000
.90453
appraisal System
12
3.9167
28868
appraisal System
12
3.3333
98473
Valid N (listwise)
12
between 1&2 but it will be taken to 1)
The ratings given to process of communicating performance standards, performance review
process and clarity of performance appraisal falls somewhere between 3 and 4 hence it can be
said that respondents think these three aspects of their performance appraisal process are very
good. While respondents have rated feedback mechanism and transparency somewhere between
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(Source: Survey)
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3 and 4 hence it is indicated that respondents view these two aspects of their performance
appraisal process as good.
TABLE NO 6: PATNI DESCRIPTIVE STATISTICS
Item
Minimum
Maximum
Mean
Std.
Deviation
12
2.8333
.93744
Feedback Mechanism
12
2.667
.6513
12
2.9167
1.16450
appraisal System
12
.00
2.3333
.98473
appraisal System
12
.00
1.9167
.66856
Valid N (listwise)
12
From the above table it can be said that the respondents have rated process of communicating
performance standards, feedback mechanism and performance review process somewhere
between 2 and 3 hence it is considered that respondents view these three aspects of their
appraisal system as good. The rating given for clarity of performance appraisal process falls
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(Source: Survey)
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somewhere between 2 and 3 hence it is clear that respondents view it as average while
transparency of performance appraisal system is rated somewhere between 1 and 2 which means
respondents view it as average.
From the above data analysis it is being found that;
1. Output/Result, Core Competency are given due weightage while appraising the
performance of the employees.
2. The respondents of the majority companies have rated the process of communicating
standards, feedback mechanism as very good.
3. Out of five selected ITES Companies; the respondents of majority of the companies i.e.
4 out of 5 companies have expressed their positive response towards the various aspects
of their existing performance appraisal system such as performance review process,
clarity of performance appraisal system and transparency. In case of Patni Computer
Systems the respondents have expressed their dissatisfaction towards transparency and
clarity of their existing performance appraisal system.
CONCLUSION
In this present paper, with the help of questionnaire analysis, the existing performance appraisal
systems of the selected ITES companies have been evaluated on the basis of criterias considered
for appraisal, process of communicating standards, feedback mechanism, and performance
review process, Clarity of performance appraisal process and transparency of performance
appraisal process. It appears that the respondents of the majority of selected ITES companies are
in agreement with their existing performance appraisal system.
REFERENCES
1. Armstrong, M. and Baron A. (2005), Managing performance: performance
management in action , CIPD, London.
4. Fletcher C. (2001), Performance appraisal and management: The developing research

agenda Journal of Occupational and Organisational Psychology, 74, 4, 473-487.
5. Weightman, J. (1999), Managing People and Organisation, Institute of Personnel and
Development, London
145
3. Dessler G. (2002), A Framework for Human Resource Management , Rajkamal

Electric Press, India.
2. CIPD. (2008d), Performance Appraisal , Factsheet, CIPD.

13 - ZIJMR - Vol2 - Issue5 - May 2012

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13 - ZIJMR - Vol2 - Issue5 - May 2012

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ZENITH

International Journal of Multidisciplinary Research

AN ANALYTICAL STUDY OF PERFORMANCE APPRAISAL SYSTEM

KEYWORDS: Performance Management, Performance appraisal system, Case study, ITES

The performance appraisal is essentially a formal mechanism of reviewing individual employee

Performance appraisal is a well-established way of providing milestones, feedback, guidance and

SAMPLING TECHNIQUE AND SAMPLE SIZE

Ability of meeting defined

Ability to meet deadlines

Attitude towards the work

Technical Knowledge & Skills

Performance Review Process

Performance Review Process

Performance Review Process

TABLE 5 : IBM DESCRIPTIVE STATISTICS

Performance Review Process

Performance Review Process

4. Fletcher C. (2001), Performance appraisal and management: The developing research

3. Dessler G. (2002), A Framework for Human Resource Management , Rajkamal

2. CIPD. (2008d), Performance Appraisal , Factsheet, CIPD.

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