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A SUMMER TRAINING PROJECT REPORT ON

PERFORMANCE MANAGEMENT SYSTEM


Submitted in partial fulfillment for the award of two years fulltime Dual degree masters programme in management (2010-2012) Name of the company: Pyrotech Electronics Private Ltd. Submitted by: Shweta Audichya

PACIFIC INSTITUTE OF MANAGEMENT AND TECHNOLOGY

Pacific academy of higher education and research Pacific Hills, Airport road, Pratanagar Extension, Udaipur 313003

ACKNOWLEDGMENT

I wish to express my sincere gratitude to Prof. K.K.Dave, Director Pacific Institute Of Management And Technology, Udaipur for providing me an opportunity to complete my project work on how performance management system works at Pyrotech Electronics Private Ltd. I sincerely thank to my project guide Prof. Narendra Chawda, faculty PIMT and my mentor for guidance and encouragement in carrying out this project work. I am really thankful to my mentor for the constant reminders and much needed motivation. My special thanks to my supervisor Ms. Saumya Dwivedi Human Resource Manager for her kind co-operation to the completion of my project work. I also wish to express my gratitude to the officials and other staff members of Pyrotech Electronics Private Ltd who rendered their help during the period of my project work. At Last I wish to avail myself of this opportunity, express a sense of gratitude and love to my beloved parents for their providing strength, help and for everything. Last but not the least I would like to thank God who made all things possible.

With Sincere Thanks, SHWETA AUDICHYA

CERTIFICATE

This is to certify that Ms. SHWETA AUDICHYA a student of Dual Degree Masters programme
in Management, Pacific Institute Of Management And Technology, Udaipur has successfully undergone her summer training in HR Department of Pyrotech Electronics Pvt. Ltd. from May 23 2011 to July 10,2011. She has done the project on Performance Management System. During her study of research she has worked hard and made all her efforts to complete the project. We wish her all success in future.

Company Name Pyrotech Electronics Pvt. Ltd.

Company Seal

Designation

Signature

PREFACE

Practical knowledge means the visualization of the knowledge, which we read in our books. For this, we perform experiments and get observations. Practical knowledge is very important in every field. One must be familiar with the problems related to that field so that he may solve them and become a successful person.

After achieving the proper goal in life, a manager has to enter in professional life. According to this life, he/she has to serve an industry, may be public or private sector or self-own. For the efficient work in the field, he must be well aware of the practical knowledge as well as theoretical knowledge.

To be a good manager, one must be aware of the industrial environment and must know about management, working in the industry, labor problems etc. so he/she can tackle them successfully.

Due to all the above reasons and to bridge the gap between theory and practical, our curriculum provides a practical training of 2 months. During this period, a student works in the industry and gets all type of experience and knowledge about the working environment. I have undergone my summer training (after 2nd semester) at Pyrotech Electronics Pvt. Ltd. in Udaipur. This report is based on the knowledge, which I acquired during my training period.

EXECUTIVE SUMMARY

For any student pursuing higher studies in a professional course, especially in management, the research project is a necessary for all round development of skills and l\knowledge. As a part of the course curriculum, each and every year student has ton undergo major research project in the real world & experience the working in and environment. I as fortunate to get the opportunity in the well established conglomerate A STUDY ON PERFORMANCE MANAGEMENT SYSTEM. It enables special focus and concentrated efforts on the major research project. Under the research project, I have done study performance management system at Pyrotech Electronics Private Ltd. The rationale for this was: 1. To manage performance and align individual objectives to business objectives. 2. To help appraise to give his/hr best performance by focusing on major value adding results. 3. To motivate the employees towards the organizational goals. 4. To help him/her become aware of his/hr strengths and to bring some areas for improvement to his/her attention. Such study is useful as it help appraise on focusing his/hr major value.

DECLARATION

I, SHWETA AUDICHYA, student of PGDM of, Pacific Institute Of Management And Technology, Udaipur, hereby declare that the project report on how performance management system works at Pyrotech Electronics Pvt. Ltd., Udaipur, is an original and authenticated work done by me. I further declare that it has not been submitted elsewhere by any other person in any of the institutes for the award of any degree or diploma.

SHWETA AUDICHYA Date:

TABLE OF CONTENTS

Title 1. Acknowledgement 2. Preface 3.Executive Summary Chapters 1. Introduction Introduction of HR Performance Management System 2. Company Profile 3. Objective and Rationale of the study 4. Research methodology Introduction & objective Research Design Data collection Instruments 5. Data Analysis and Interpretation 6.Findings,Suggestions, Conclusion & Limitations 7. My Learning 8. Bibliography

Page No.

CHAPTER - 1 INTRODUCTION OF THE PROJECT

PERFORMANCE MANAGEMENT SYSTEM

INTRODUCTION
Human Resource Human resource is a term used to describe the individuals who comprise the workforce of an organization, although it is also applied in labour economics to, for example, business sectors or even whole nations. Human resources is also the name of the function within an organization charged with the overall responsibility for implementing strategies and policies relating to the management of individuals (i.e. the human resources). This function title is often abbreviated to the initials 'HR'. Human resources are a relatively modern management term, coined in the 1960s. The origins of the function arose in organizations that introduced 'welfare management' practices and also in those that adopted the principles of 'scientific management'. From these terms emerged a largely administrative management activity, co-coordinating a range of worker related processes and becoming known, in time as the 'personnel function'. Human resources progressively became the more usual name for this function, in the first instance in the United States as well as multinational corporations, reflecting the adoption of a more quantitative as well as strategic approach to workforce management, demanded by corporate management and the greater competitiveness for limited and highly skilled workers.

PERFORMANCE MANAGEMENT SYSTEM


Performance It is actual results vs. desired results. A performance management system consists of the processes used to identify, encourage, measure, evaluate, improve, and reward employee performance at work. Employees job performance is an important issue for all employers. However, satisfactory performance does not happen automatically; therefore, it is more likely with a good performance management system. Appraisal serves a two fold purpose: (1) to improve employees work performance by helping them realize and use their full potential in carrying out their firms missions and (2) to provide

information to employees and managers for use in making work related decisions. Best practices in Performance Management dictate a proactive approach to the Performance Appraisal or Review Process that follows the multi-phase design:

Planning Phase: Set mutually agreed upon goals and guidelines for employee evaluation. Determine the key objectives for measuring success in the position and set developmental goals to encourage greater productivity and results.

Performance Phase: The longest phase that allows the employee to meet goal and objectives, develop new skills and track accomplishments or set backs in the system throughout the process. Managers are reviewing performance and making notes as well.

Assessment Phase: Employees are given an opportunity near the end of the performance cycle to provide feedback on the preset goals, competencies and objectives to deliver to their manager. This is when the manager will document feedback on the employee performance as well. The system allows senior managers to review all submitted documentation and sign off before the actual review is complete.

Review Phase: Manager and employee sit down together to discuss the year in review. Reviews can be presented online or printed and e-signature that the review took place can be captured in the system to protect the organization if legal review should occur.

Performance Management
Performance management is the practice of actively using performance data to improve the public's health. This practice involves strategic use of performance measures and standards to establish performance targets and goals, to prioritize and allocate resources, to inform managers about needed adjustments or changes in policy or program directions to meet goals, to frame reports on the success in meeting performance goals, and to improve the quality of public health practice.

Performance Management components include: Performance Standards - establishment of organizational or system performance standards, targets and goals and relevant indicators to improve public health practice Performance Measures - application and use of performance indicators and measures Reporting of Progress - documentation and reporting of progress in meeting standards and targets and sharing of such information through feedback Quality Improvement - establishment of a program or process to manage change and achieve quality improvement in public health policies, programs or infrastructure based on performance standards, measurements and reports.

Why Do We Need Performance Appraisals? Performance Appraisal is an objective system to judge the ability of an individual employee to perform his tasks. A good performance appraisal system should focus on the individual and his development, besides helping him to achieve the desired performance. This means that while the results are important the organization should also examine and prepare its human capital to achieve this result. This holds true even for new inductees.

Performance Management
It includes activities that ensure that goals are consistently being met in an effective and efficient manner of any organization. It focuses on the performance of An organization A department An employee And many other areas It is an integrated approach to ensure that an employee performance support & contributes to the organization strategic goals.

It can be thought of as a cycle Performance planning where goals and objectives are established. Performance coaching where a manager intervenes to give feedback Performance appraisal where individual performance is formally documented and feedback delivered It is a formal system of review and evaluation of individual or team task performance.

Steps in Performance Appraisal

Setting work standards Assessing work performance providing feedback (to motivate, correct, and continue their performance)
Objectives of Appraisal Almost all organizations practice performance appraisal in one form or another to achieve certain objectives. These objectives may vary from organization to organization or even within the same organization from time to time. It has been found that there are two primary objectives behind the use of this methodology. One is to use it as an evaluation system and second, to use it as a feedback system. The aim of the evaluation system is to identify the performance gap. This means that it helps determine the gap between the actual performance of the employee and that required or desired by the organization. The aim of the feedback system is to inform the employee about the quality of his work or performance. This is an interactive process by which the employee can also speak about his problems to his superior.

An effective performance appraisal system should emphasis individual objectives, organizational objectives and also mutual objectives. From the viewpoint of individual objective the performance appraisal should talk about a) What task the individual is expected to do? b) How well the individual has done the task? c) How can his performance be further improved? d) His reward for doing well. From the organizational view point a performance appraisal should generate manpower information, improve efficiency and effectiveness serve as a mechanism of control and provide a rational compensation structure. In short the appraisal system establishes and upholds the principle of accountability in the absence of which organization failure is the only possible outcome. Finally, talking about mutual goals, the emphasis is on growth and development, harmony, effectiveness and profitability. Methods of Performance Appraisal In order to achieve the objectives, a variety of performance appraisal methods have been developed. The choice of method depends on organizational ethos, its objectives, size, product and technology. The most traditional method is the Confidential Report method where the supervisor makes an evaluation of his subordinate on the basis of certain characteristics like loyalty, intelligence, conduct, character etc. In some other methods like Graphic Rating scale and the Ranking Methods though the process is simple it is plagued with subjectivity. In the Critical Incidents method a balance sheet of on-job-behavior for each employee is generated which can then be used at the end of the year to see how well the employee has performed. In 1961 Peter Drucker popularized the Management by Objectives (MbO) method. In this method the subordinate in consultation with the supervisor chalks out short term objectives followed by specific actions that he has to carry out. The goals are finally set and are action oriented. The goals set should be specific, measurable, achievable, review able and time bound

and most importantly it should be aligned with the goal of the organization. At the end of a specified time period, the activities are jointly reviewed by both the subordinate and his supervisor. Depending on the performance of the subordinate, the goals are modified or redesigned for the next period of time. Methods & techniques to evaluate the performance Graphic rating scale method Alternation ranking method Paired comparison method Forced distribution method Critical incident method Behaviourally anchored rating scales (BARS) Management by objectives(MBO) Annual confidential report(ACR)

Performance Management and Performance Appraisal Many people mistake performance appraisal for performance management. Actually, performance management is a much bigger system, and is much more valuable to managers and companies (and employees) than performance appraisal. The essential components or parts of an effective performance management system include:

Performance Planning (includes employee goal setting / objective setting) Ongoing Performance Communication Data Gathering, Observation and Documentation Performance Appraisal Meetings Performance Diagnosis and Coaching

Performance Management is an ongoing process of measuring and adjusting performance continually focusing on behaviours throughout the year. It is a continuous process not an event. It is not the same as performance appraisal, which is an assessment of the employees

performance by both the employee and his superior jointly, with the purpose of allocating a score that may be used for both development and salary or promotion purposes. Performance Management includes Performance Appraisal as one of its elements. Performance Management should became part of day to day workplace behavior. Some organizations have adopted an online Performance Management system. Going online with performance management puts ownership of the process in the hands of the individual as opposed to the traditional manager driven system. It allows direct communication between the individual and the manager via online journals at times convenient to both. It links performance with the individuals learning and development plans and also to the organizational goals, values and competencies Uses HR planning Availability of data to identify those who have the potential to be promoted. Recruitment and selection Predicting the performance of job applicants Training & development Point out an employee specific needs for T & D Compensation Provide a basis for rational decisions regarding pay adjustments. Internal employee relation Such as promotion, demotion, termination, layoff and transfer. In, Pyrotech group, they have adopted a performance appraisal model in which best-to-worst ranking methods are used to identify poor performers. The identified poor performers are then given a time period during which they have to show an improvement in their performance. In cases where the employee fails to improve his performance he is asked to leave the organization gracefully and a severance package is offered to him. If the employee refuses to leave then his service is terminated and no compensation is offered. Advocates of this system feel that it continually motivates employees to improve their performance since nobody would like to be

included in the poor performance band. But the flip side of this strategy is that employees become too competitive and team spirit is not nurtured.

Building blocks of an effective performance management process Direction sharing Role clarification Goal setting & planning Goal alignment Developmental goal settings Ongoing performance monitoring Ongoing feedback Coaching and support Performance appraisal Rewards , recognition & compensation

CHAPTER -2 COMPANY PROFILE

PYROTECH ELECTRONICS PVT. LTD. UNIT II

2.1 COMPANY BACKGROUND


We are an ISO-9001 company associated with manufacturing and supply of Control Room Equipment, Electronic Process Control Instruments and Sensors, for last three decades for power plants, process plants and other industries. Pyrotech came in to existence in 1976 and we have registered an average rate of growth of 55%, since inception. We manufacture around 200 different types of instruments. All of our products are subject to 23 stringent tests for quality control (High freq disturbance, ESD, Vibration, high voltage, EMC etc.). We also represent Siemens field instruments, L&T drives, Schneider PLC, Cirronet wireless radios, Madison Ultrasonic/Radar level transmitter. Our project division has done complete C&I projects for captive power, sponge iron, waste-water and other industries. Our group companies are :1. PEPL unit-1: Electronic Process and Control Instruments. 2. Pyrotech Control (India) Pvt. Ltd.: Enclosures, Control and Mosaic panels. 3. PEPL unit-2: Control panels, control desks and Mosaic panels and Industrial furniture. 4. Tempsens Inst. (I) Pvt. Ltd.: Temperature sensors, Thermocouples and RTDs. We have wide acceptance amongst OEMs and system integrators namely BHEL, NTPC, Siemens, L&T, ABB, Honeywell Ltd., Yokogawa India Ltd., etc. Our consultants include EIL, PDIL, HOWE, Holtec, Lurgi, Tata Consulting Engineers, Toyo Engineering India Ltd., etc. Further, we have been supplying our products and expertise to a wide array of customers in Power, Petrochemical, Chemical, Fertilizer, Food processing, Metallurgy, Cement, Sugar and other Industries. In the journey of over 2 decades & more, we have expanded to match global vision & progressed steadily through up gradation of technology, quality and skills. Today, we are one of the India's leading manufacturers of automation & control equipment. Pyrotech has an exceptional multi-disciplinary array of products - Panels, Enclosures, LVS, LIR/LIE, Computer Consoles, Electronic products and Office-Industrial furniture. To reap advantages of Global Integrated Chain, we collaborated with companies like Synelec (LVS), Subklew (Mosaic Tile System), & Weigel Meters (Meters). In every true sense of the word, we have become, The Control Room Solutions Provider. Approved by major consultants and working with large OEMs, we are in position to cater to the needs of a Varity of industries, ranging from Power to Petrochemicals, Metering to Railways, Material Handling to Process Control, Cement to Defense and many more.

2.2 ORGANIZATION POLICY Our organization Policy is to manufacture defect free Panels, control desks, Process control systems & industrial enclosures to Provide value for money & customer satisfaction. The organization wants to create ZERO DEFECTS working culture by continually improving quality, technology & skills.

2.3 PYROTECH GROUP

Pyrotech Group (Control & Instrumentation Electronic & Sensor Equipment)

Pyrotech Electronics Pvt. Ltd. Unit I ISO 9001:2000 (Electricals & Electronics)

Pyrotech Electronics Pvt. Ltd. Unit II ISO - 9001 : 2008 EMS 14001 : 2004 OHSAS : 18001 : 2007 (Control & Instrumentation)

Tempsens InstrumentIndia Pvt. Ltd. ISO 9001:2000 (Temprature Sensors)

Pyrotech Marketing & Projects Pvt. Ltd. (Marketing)

Annuniciator Bar Graphindicator Transducer Scanner

Industrial Automation

Thermocouple Resistance Thermometers(RTD's)

Services, Marketing PLC Projects

2.4 QUALITY POLICY "Pyrotech Electronics Pvt. Ltd. is committed for customer satisfaction by design, manufacturing & supply of Process control instruments as per agreed customer requirements by employing trained manpower, ensuring in time delivery and continual improvement in quality system & technology."

2.5 VISION FOR TOMORROW Our work is focused on creating and continuously improving a sensitive organization capable of reacting promptly to market requirements and customers need. We will continue to earn customer's trust with highest quality of services. WE RESEARCH, PLAN, DESIGN AND INVEST FOR FUTURE.

2.6 CORPORATE MILESTONES OF THE ORGANIZATION

1976 Pyrotech is founded in Udaipur. First products Thermocouple and RTD 1980-1982 Diversification into electronics and panel making 1982 First turnkey instrumentation package for JK White Cement 1984 Prototype development of ALCOSY 1985 Separate temperature sensor division, Tempsens established 1986 Landmark year as BHEL Bangalore approves and starts using ALCOSY enclosures 1990 HZL Chanderia plant instrumentation package completed 1991 Electronics division separated from the panel division, panels division named Pyrotech Controls (I) Pvt. Ltd. First Line Side Equipment developed and installed for NTPC 1992 Training modules for TISCO developed 1993 High performance 19 Racks developed for defence supplied to Indian Army 1994 Major Power projects executed with mosaic tile system 1998 New factory with a space of 50,000 sq. ft set up at Udaipur, named Pyrotech Electronics Pvt. Ltd., Unit#2 1999 Tie up with Synelec, France for Videowall, Siemens Germany for PA1 products, Dr. Thiedig for SWAS

ISO 9001 CERTIFICATION RAJIV GANDHI NATIONAL QUALITY AWARD 2000 Control Room Design new concept in Indian market 2001 Prestigious projects executed NTPC Simhadri, UPSEB, BSES Seismic approval for mosaic control desk at 3.5g 2002 Indigenous technology for mosaic tiles developed for Delhi Metro Railway Corporation 2003 Major orders executed for display walls for NTPC Rihand, Ramagundam and Tata Power

2004 New modular furniture range for industrial and offices developed. Sales Turnover Rs. 25 Crore in 2004, Group Turnover Rs. 40 Crore 2005 Major turnkey instrumentation package for NPCIL Kaiga and Rawatbhata. Sales Turnover Rs. 32 Crore in 2005, Group Turnover Rs. 56 Crore Manufacturing of MCC draw out and PCC panels started in 2005. 2006 Quantum increase in turnover from Rs. 32 crores to Rs.55 crores. Significant small and big order were received in this year. 2007 A new unit for Control Room & Office furniture started in 2007, in the name of Pyrotech Workspace Pvt Ltd, Udaipur with an area of about 80,000 sq ft. Major order received from Power Machines Ltd. Russia for NTPC Sipat Project (3 x 660 MW) for UCD, UCB and Marshalling Panels. 2008 Accreditation from DNV, ISO 14001 : 2004 and OHSAS 18001 : 2007 received. 2009 New factory with a space of 70,000 Sq. ft. set up at Udaipur in the name of Pyrotech Electronics Pvt. Ltd. Unit # 4. 12 KV KIOSK developed for JVVNL. 2010 Major order from BHEL for Video Wall (56 Cubes) for NTPC Dadri Korba and Farakka received. Major order from Invensys for Video Wall (96 Cubes) for NTPC Mauda, Rihand and Vindhyachal received. Exceeding customer satisfaction is the top priority. We have Industry specific dedicated sales engineers, this provides a updated knowledge and the best available technological product design for particular industry. We also provide expert support during product selection, customization and commissioning, to achieve maximum techno-economic effectiveness. The close partnership with our customers starts long before goods are delivered intensive individual consultation plays a central role for us . Our marketing route are direct and established. You can rely on them. Our distribution and service outreach underlines our strong customer orientation. Our products fulfill the most exacting demands and have been tested under extreme conditions. We provide a comprehensive guarantee. During the last 30 years, our team of professionals has recorded numerous achievements, generating remarkable growth. Our staff of industry-experienced engineers are dedicated to the constant improvement and development of products. The managerial staff and technical personnel have good training, technical knowledge and experience for their assigned functions. Our team work has resulted in successful development of the products, the system, the approach, the services and above all, the confidence of our customers.

2.7 PRODUCTS PANELS & CONTROLS DESKS Mosaic Panel & Desk Mimic Panel Control Panel PLC Panel Marshalling Panel Networking Panel 19" Transducer Panel 19" Rack Panel MCC Panel Purge & Explosion Proof Panel Junction Box Metering Box LIE/LIR Shelter Panel HT Panel NG & LAVT Cubicle Test Bench Computer Consoles

SYSTEM INTEGRATIONS DISTRIBUTORSHIP SYNELEC - Large Video Screen SUPTEAM - Mosaic Tile System WEIGEL - Panel Meters And Accessories Cheval - 19" Rack Solutions WORKSPACE SOLUTION Industrial Furniture Office Furniture

2.8 DEPARTMENTS 2.8.1 HR


Functions of Senior Manager- Talent Management/C&B/Partner Compensation and Benefits: development and integration of the organization as a whole Various individual development plans and strategies are planned, executed and proper follow up is done. HR Operations: Performance Management. Training (Learning and Development): Employee Relations

2.8.2 Commercial

2.8.3 Customer Service and Support 2.8.4 Finance 2.8.5 Stores 2.8.6 Design 2.8.7 CNC 2.8.8 Fabrication 2.8.9 Painting
2.8.10 Marketing and sales 2.8.11 Internal Tubing 2.8.12 Wiring 2.8.13 Quality Assurance 2.8.14 Packing 2.8.15 Dispatching

2.9 AWARDS : November - 1993 : "Excellence in Electronics" award by Department of Electronics.

September - 1994 : Pyrotech Electronics Pvt. Ltd. Unit-I was honoured with "ELCINA" award for Research & Development. November - 1999 : National Quality award" Pyrotech Electronics Pvt. Ltd Unit-II was honoured with "Rajiv Gandhi

"Council for Business Practice" Award for Service Price Quality

2.10 SWOT analysis


STRENGTH Lean cost structure Effective business model Innovation leadership Event sponsoring Good marketing and distribution strategies Strategic alliance with suppliers Quick responsiveness Strong R&D: taken over from IBM WEAKNESS Unable to maintain sustained growth rate in all market segment Ignoring potential market Retaining of largest competitors Poor global perception High delivery time:3 weeks shares by

OPPORTUNITY Increasing global demand for PC Specialty shops proving one stop platform for distribution Government organizations

THREAT to Competition threat from both local and international markets Industry reaching maturity Poor and irregular maintenance of machines Price war Emerging small firms International competitors forming alliances with local competitors.

increasing their spending on IT Increasing product lines Development of Junction Boxes Converting manual orders product portfolios/

automotive orders

2.11 CUSTOMERS LIST OEM's : Asea Brown Boveri Ltd. Instrumentation Ltd. Larsen & Toubro Ltd. Siemens Ltd. Thermax Ltd. Chemical : SRF Ltd. Indian Petrochemicals Corporation Ltd. Rajasthan State Mines and Minerals Ltd. Tata Chemicals Ltd. Mysore Petro Chemicals Ltd.

Power : National Thermal Power Corporation Ltd. Karnataka Thermal Power Corporation Ltd. Maharashtra State Electricity Board Andhra Pradesh State Electricity Board Badarpur Thermal Power Station.

Fertilizer : IFFCO National Fertilizer Ltd. Chambal Fertilizer & Chemicals Ltd. Coromandel Fertilizer Ltd. Rashtriya Chemical & Fertilizer Ltd.

Sugar : Daurala Sugar Works The Dhampur Sugar Mills Ltd. Ramgarh Chini Mills Modi Sugar Mills Siel Sugar

Synthetic : Asian Paints Century Rayon Grasim Industries Ltd. Indian Rayons and Industries Ltd. Indo Rama Synthetic (I) Ltd.

Steel :

Steel Authority of India Ltd. ESSAR Steel Ltd. TISCO Vishakapatnam Steel Plant SunFlag Iron and Steel Company Ltd.

Cement : Shree Cement Ltd. Vikarm Cement Ltd. Binani Cement Ltd. The Associated Cement Co's Ltd. J.K. Cement Ltd.

J.K. White Cement Madras Cement Lafarge India Ltd. The India Cement Ltd. Century Cement

CHAPTER -3

OBJECTIVES OF THE STUDY

OBJECTIVES OF THE STUDY

Objectives of the study: To carry out the study of PEPL, we framed the following objectives:

1. To study the Effectiveness of the Performance Management System at Pyrotech Electronics Pvt. Ltd. (PEPL) from the perspectives of the employees. 2. To understand the shortcomings of the Performance Management System at Pyrotech Electronics Pvt. Ltd. (PEPL) 3. To come out with solutions that will help the organization in formulating better strategies for the development of the employees and the organization. 4. To identify the technique of performance appraisal followed in PEPL. 5. Employee attitude towards the present appraisal system. 6. Review of the current appraisal system in order to 1. Enhance productivity 2. Attain global standards 7. To provide suggestions & recommendations from the study conducted.

CHAPTER -4 RESEARCH METHODOLOGY

Research is common parlance to refer to a search for knowledge. Research comprises defining problem, formulation hypothesis or suggesting solution, collecting, organizing or evaluating data and reaching conclusion and at last carefully testing conclusion to determine whether fit the formulated hypothesis. Research is a careful investigation or enquiries for new facts in any branch of knowledge. Researchers are basically systematic enquiry with customers critical examination with objective to search new facts or interpret know facts in light. When we talk of research methodology, we not only talk of the research methods but also the comparison of the logic behind the methods, we used in this context of our research study and explain why we are using a particular method or technique and why using the others. Research methodology is a way to systematically solve the research problem. It may be understood as a science of studying how research is done systematically. In this, we study the various steps that are generally adopted by researcher in studying his research problem along with the logic behind them. The present study is based upon the case study method of research to investigate procedures at micro level.

Research always starts with a question or a problem. Its purpose is to answer to questions through the application of the scientific methods. It is a systematic and intensive study directed towards a more complete knowledge of the subject studies. Once the problem is defined properly then one can easily check out the Objectives for the research.

4.1. Introduction to the Project Topic:


Performance management is the activity of tracking performance against targets identifying opportunities for improvement - but not just looking back at past performance. The focus of performance management is the future - what do you need to be able to do and how can you do things better? Managing performance is about managing for results. Performance-based management at any level in the organization should demonstrate that:

You know what you are aiming for You know what you have to do to meet your objectives You know how to measure progress towards your objectives You can detect performance problems and remedy them

4.2 Statement of the problem


Measuring employee performance has come a long way from the annual performance appraisal to an ongoing performance management system. Performance Management is one of the key processes that, when effectively carried out, helps employees know that their contributions are recognized and acknowledged. But at times it gets diverted from its objectives. There is a need that the opinion of the appraisees about the Performance management system be discussed with the management so as to make the system highly effective. Management desires information on the perception of the employees towards the existing performance management system and hence wants to gauge its effectiveness. Hence this study is being conducted and therefore the statement of the problem is: To study the Effectiveness of the Performance Management System at Pyrotech Electronics Pvt. Ltd.

4.3 Title of the study:


The project is titled as A Study on the Effectiveness of the Performance Management System at Pyrotech Electronics Pvt. Ltd.

4.4 Scope of the study:


The study is exclusively conducted on the employees of Pyrotech Electronics Pvt. Ltd. who have undergone at least one appraisal cycle. The study is conducted to analyze and obtain their insights about the Performance Management System. It was carried out within the office at Udaipur city over a period of six weeks.

4.5 Research Methodology:


RESEARCH METHODOLOGY Type of Research Type of Data Data Collection Method Sample Size Sample unit Sampling Technique Descriptive Primary Questionnaire 50 Employees of PEPL. Random Sampling

3.6.1 Sources of Data For the purpose of the study, both primary and secondary data are utilized. Primary data is collected through self administered structured questionnaire. Each respondent was interviewed and data was collected. The questionnaire contained fourteen questions. Secondary data is collected from Internet, Newspapers and magazines, company web link.

3.6.2 Research Type: The type of research adopted for the project is descriptive research. It refers to those studies used to describe phenomena associated with a subject population or to estimate proportions of the population that have certain characteristics. Descriptive research basically means discovery of association among different variables.

3.6.3 Sampling Plan:

Type of sampling: Random sampling is a common probability method. The researcher selects the sample randomly. Sampling Unit: The study is conducted on the employees of PEPL who have at least undergone one appraisal cycle. The survey was conducted to know about their perception towards the Performance Management System. The main motive behind the survey is to study the effectiveness of the PMS from the employees perspective.

Sample Size: A sample of fifty respondents was considered as sample size for the research.

3.6.4 Research Instrument The main tool that has been used in data collection is questionnaire that has been constructed for this purpose. Primary data was collected by means of questionnaire which was distributed to the employees of Pyrotech Electronics Pvt. Ltd. who have at least undergone one appraisal cycle.

3.6.5 Data Collection Method The survey was conducted by way of personal interview wherein the researcher gave the respondent the questionnaire and initiated a two-way conversation to obtain information from the participant. Evaluation has been done in the phases: o Filling up of questionnaire by the employees o Methodology used was one to one discussion with employee. o The final analysis is done on the basis of information extracted from the filled questionnaire.

Chapter-4 Data Analysis and Interpretation

4.1. ANALYSIS AND INTERPRETATION: The present chapter focuses on the results derived to analysis and interpretation of the primary data. Table 4.1 Showing frequency of the respondents familiarity with the process of Performance Management System : Frequency Yes No Total 43 7 50 Percent 86 14 100

Graph 4.1 Showing frequency of the respondents familiarity with the process of Performance Management System

Percentage of the employees familiarity with the process of Performance Management System(PMS)
14%

Yes No

86%

Inference: 86% of the respondents said YES when asked whether they were familiar with the process of Performance Management System

Table 4.2 Showing perception of employees regarding PMSs simplicity: Frequency 41 9 50 Percent 82 18 100

Yes No Total

Graph 4.2 Showing perceptions of employees regarding PMSs simplicity

Perception of employees regarding PMSs simplicity

18%
Yes No

82%

Inference: Majority of the respondents (82%) feel that PMS is simple, 18% of respondents did not agree.

Table 4.3 Showing percentage of employees satisfied with the current PMS: Frequency Yes No Total 40 10 50 Percent 80 20 100

Graph 4.3 Showing percentage of employees satisfied with the current PMS

Percentage of employees satisfied with the current PMS

20%
Yes No

80%

Inference: Majority of the respondents (80%) are satisfied with the current PMS, and 20% of respondents are not satisfied with it.

Table 4.4 Showing percentage of employees satisfied with rating system:

Frequency Yes No Total 42 8 50

Percent 84 16 100

Graph 4.4 Showing percentage of employees satisfied with rating system

Percentage of employees satisfied with rating system

16%
Yes No

84%

Inference: Majority (84%) of the respondents are satisfied with the rating system ,only a few (16%) are not satisfied and have given some suggestions to improve the rating system.

Table 4.5 Showing percentage of employees, who gets motivated from the recognition given to high performers:

Frequency Yes No Total 43 7 50

Percent 86 14 100

Graph 4.5 Showing percentages of employees, who gets motivated from the recognition given to high performers

Percentage of employees, motivated from the recognition given to high performers

14% Yes No 86%

Inference: Majority (86%) of the respondents get motivated when the recognition is given to the high performers.

Table 4.6 Showing percentage of employees who feel that the PMS is biased: Is it biased? Frequency Yes No Total 12 38 50 Percent 24 76 100

Graph 4.6 Showing percentages of employees who feel that the PMS is biased

Percentage of employees who feel that the PMS is biased

24% Yes No 76%

Inference: Majority (76%) of respondents feel that PMS is not biased and some of them (24%) feel that it is biased.

Table 4.7 Showing response regarding getting opportunity to take part in goal setting: Sufficient opportunity to take part in goal setting Frequency Yes No Total 45 5 50 Percent 90 10 100

Graph 4.7 Showing responses regarding getting opportunity to take part in goal setting

Percentage of employees regarding getting opportunity to take part in goal setting 10%

Yes No

90%

Inference: Majority (90%) of the respondents gets opportunity to take part in the goal setting, while some of them dont get sufficient opportunity to take part in goal setting.

Table 4.8 Showing response of employees regarding discussing targets: Line managers always discuss performances and targets with you

Frequency Yes No Total 43 7 50

Response (in %) 86 14 100

Graph 4.8 Showing response of employees regarding discussing targets

Involvement of employees in discussing targets with managers

14%

Yes No

86%

Inference: Majority (86%) of employees feel that line managers always discuss performances and targets with them .

Table 4.9 Showing response regarding autonomy to plan, organize and do the work

Frequency Yes No Total 45 5 50

Response (in %) 90 10 100

Graph 4.9 Showing response regarding autonomy to plan, organize and do the work

Percentage of employees regarding autonomy to plan, organize and do the work


10%

Yes No

90%

Inference: Majority of employees (88%) feel that employees are empowered and have the autonomy to plan, organize and do their work, which shows a level of comfort among the employees.

Table 4.10 Showing response regarding who should do the appraisal? Options (a) Superior (b)Subordinate (c)Self Appraisal (d)Consultant (e)All of the above Frequency 10 0 2 6 32 Response ( in % ) 20 0 4 12 64

Graph 4.10 Showing responses regarding who should do the appraisal?

Perception of employees regarding "who should do the appraisal"

20%
(a) Superior

4% 12%

0%

(b)Subordinate (c)Self Appraisal (d)Consultant (e)All of the above

64%

Inference: Majority (64%) of employees feel that appraisal should done by each one (superiors, subordinates, self, consultant).While 20% think that appraisal should done by superiors.

Table 4.11 Employees timely get automatic E-Mail reminders, and prompts, when targets are due.

Options (a) Yes (b) No

No. of respondents 46 4

Percent 92 8

Graph 4.11 Showing response regarding automatic E-Mail reminders, and prompts, when targets are due

Perception of employees regarding reminders, when targets are due


8%

(a) Yes (b)No

92%

Inference: From the above figure we can conclude that 92% of the employees are getting automatic mails timely when the targets are due. It seems that how careful the company is about the target achievement and the company wants employees to achieve the given targets on time. System needs to have an overview that where the problem exist with these 8% employees. May be some technical problem is there so fix it.

Table 4.12 Compensation on the basis of the performance evaluation creates disputes in the organization.

Options (a) Agree (b)Disagree

No. of respondents 13 37

Percent 26 74

Graph 4.12 Showing response regarding Compensation on the basis of the performance evaluation creates disputes in the organization.

Showing response regarding Compensation on the basis of the performance evaluation creates disputes in the organization.
26%
(a) Yes (b)No

74%

Inference: Here as we can see that 74% of the employees disagree with the statement that means compensation on the basis of the performance evaluation do not create disputes in organisation and this method is good enough. On considering the portion of the employees saying it creates disputes which is only 26%, system just need to give an overview to the process.

Table 4.13. Showing response of PMS in polishing skills & performance area Options Yes 9 No 18 Frequency 41 82 Response ( in % )

Graph 4.13 Showing responses of PMS in polishing skills & performance area

Perception of employes regarding improvement in skills & performance area through PMS
18%

Yes No

82%

Inference: If the process of appraisal does not lead to the improvement of the skills and proficiency of the employees, the very purpose of appraisal becomes illogical. In the survey conducted it was observed that nearly 82% of the respondents agree that Performance Appraisal does leads to polishing the skills of the employees.

Table 4.14. Showing response of employees towards the personal likings do come in the process of appraisal while appraising an employee. Options Yes No Frequency 33 17 Response ( in % ) 66 34

Graph 4.14 Showing response of employees towards the personal bias while appraising an employee

Perception of employees regarding personal bias

34%
Yes

66%

No

Inference: In the process of appraising, both the parties are human being, that is, the one who is being appraised and the other who is appraising. Thus, there bound to be subjectivity involved, be it an objective way of appraising. Thus, when asked from among the sample size of 50 respondents, as huge as 66% responded that personal bias do creep in while appraising an individual. Hence, we can say that personal likings do come in the process of appraisal.

Chapter-5 Findings, Suggestions, Conclusion & Limitations

5.1 FINDINGS:
a) Majority of the employees (86%) are familiar with the process of Performance Management System in Pyrotech Electronics Pvt. Ltd. b) Opinions of the respondents about the simplicity of the PMS are mixed. Majority of the respondents (82%) find it simple whereas others consider it to be moderately complex. c) It was found that majority of the employees (80%) are satisfied with the current Performance Management System (PMS) whereas (20%) not satisfied. d) Majority of the employees (84%) are satisfied with the rating system and some of them are not satisfied and have given some suggestions to improve it. e) Majority of the employees (86%) respondents feel that Recognition given to high performers motivates the employees.

f) 76 % Employees at Pyrotech Electronics Pvt. Ltd. believe the PMS is not biased. Majority of the respondents in the survey gave a negative response when asked whether it is biased whereas 24% of the respondents consider it to be biased.

g) Employees also have enough courage to discuss all the matters of their goals with the manager. Majority (90%) of the employees feel that they get sufficient opportunity to take part in goal setting whereas 10% do not feel so. It was also found that superiors help their subordinates at the time of need.

h) 86% Employees also agree that line managers always discuss performances and targets with them.

i) 88% respondents feel that Employees are empowered and have the autonomy to plan, organize and do their work. It shows that employees have freedom to do their work in their own way.

j) Majority (64%) of employees feel that appraisal should done by each one (superiors, subordinates, self, consultant).While 20% think that appraisal should done by superiors. There is absence of 360 degree technique of appraisal. The relationship between employees and the executives is one sided.

k) 92% of the employees agreed that they are getting automatic mails timely when the targets are due. It seems that how careful the company is about the target achievement and the company wants employees to achieve the given targets on time.

l) 74% of the employees are disagreeing with the statement Compensation on the basis of the performance evaluation creates disputes in the organization. It means compensation on the basis of the performance evaluation does not create disputes in organisation and this method is good enough.

m) It was observed that most of the respondents (82%) agree that Performance Appraisal does leads to polishing the skills of the employees.

\n) 66% responded that personal likings do come in the process of appraisal while appraising an individual.

5.2. RECOMMENDATIONS/SUGGESTIONS:
After having analyzed the data, it was observed that practically there was no appraisal in the organization. To be an effective tool, it has to be on the continuous basis. This is the thing that has been mentioned time and again in the report, as, in the absence of continuity, it becomes a redundant exercise. Before actually deciding drafting what should be the kind of appraisal the following things should be taken care of:

a) Special training and awareness programs should be conducted for the appraisers and the appraisees on the purpose and the benefits of Performance Management System. It should create consciousness and strive for self development. b) Performance appraisal should not be limited to incentives alone but should be made use for identifying training needs, career development and self improvement. It should also be used for promotion and career growth. c) The performance management system should spell out the growth curve of an employee. The management should provide with growth plan for each employee and follow it effectively and efficiently. d) There should be a special committee which keeps a check on the Performance Management System and also address all the problems faced by the employees related to their performance management. e) Management should conduct regular sessions, group discussions and brain storming exercises with employees to know about their expectations from the PMS. f) Peer evaluations conducted by the employees co-workers may be initiated. They are the ones who do the same work and are aware of the co-workers performance. g) In order to achieve better understanding and to develop skills, development and training programs are of absolute necessity. So management may conduct training programs based on the performance management system.

h) The preparation of a comprehensive manual guideline giving the objectives of the system could be done. The process, the role of the appraiser, appraisees, HRD department and the

reviewing officer should be made clear. The manual should spell out the complete guidelines of the performance management system.

5.3 Suggestions from Employees


Here are some of the suggestions given by employees According to employees, PMS should be more transparent as it is only one way now. The company should have a 360 degree appraisal system, wherein ratings should be given by managers, peers and subordinates. Actual facts and figures should be considered for goal setting and there should be two way communications between manager and employees. There should be clarity of the parameters for ratings along with soft skills and hard skills specified. End date should be provided for the development plans. The time period for conducting the appraisal should be revised, so that the exercise becomes a continuous phenomenon. Transparency into the system should be ensured through the discussion about the employees performance with the employee concerned and trying to find out the grey areas so that training can be implemented to improve on that.

5.4 CONCLUSION
An organization's measurement system strongly affects the behavior of people both inside and outside the organization. If companies are to survive and prosper in information age competition, they must use measurement and management systems derived from their strategies and capabilities. Performance Management is one of the key processes that, when effectively carried out, helps employees know that their contributions are recognized and acknowledged. Performance Management System drives Performance Excellence in the Organization. It is a key to Strategic success. The organization has a sound and effective Performance Management System. At Pyrotech Electronics Pvt.Ltd.it is not considered as a mere routine affair but as a purposive developmental exercise. It gives supervisors and subordinates an equal opportunity to express themselves under structured conditions. Organization must keep up the good practices. However, they should focus on certain aspects like societal perspective, peer evaluations, forming a special committee etc. Thus, Performance Management System at Pyrotech Electronics Pvt. Ltd. is effective as it incorporates the major aspects like direction, awareness, support and rewards. It successfully recognizes and differentiates between high and low performance; brings about a feeling of transparency and fairness in the evaluation process; Increases the objectivity and accuracy of measurement of performance; Increases alignment between individual and organizational goals and increases the performance-reward linkage. It also helps in keeping a check on the performance by various follow up programs and provides various opportunities for self development. Hence, Performance Management system at Pyrotech Electronics Pvt. Ltd. is indeed effective.

5.5 LIMITATIONS OF THE STUDY


A few limitations and constraints came in way of conducting the present study, under which the researcher had to work are as follows: Although all attempts were made to make this an objective study, biases on the part of respondents might have resulted in some subjectivity. Though, no effort was spared to make the study most accurate and useful, the sample Size selected for the same may not be the true representative of the Company, resulting in biased results. This being the maiden experience of the researcher of conducting study such as this, the possibility of better results, using deeper statistical techniques in analyzing and interpreting data may not be ruled out. In the project, non-random sampling has been used which is a non probability sampling method; it therefore does not provide estimates of precision. The sample size is restricted to only those employees of Pyrotech Electronics Pvt. Ltd. who have at least undergone one appraisal cycle. The study was done for a short period of time, which might not hold true over a long period of time.

My Learning

My Learning
My internship at PEPL was a great experience. Before starting the project I was totally naive of how complex the process of business world could be. My knowledge of subjects and books was not sufficient enough to provide me a clear view of what organizations are all about, how they form their strategies, how they achieve their goals and what possibly makes successful organizations. After a period of six weeks now I find myself in a much better position to explain what an organization and business is all about. It was indeed my fortune that I got associated with an organization which has a presence all over and is very much successful in its industry.

In the internship program, I learned about the electronic industry, the company, the various businesses of the organization and its various products and services. It was a great learning experience and also gained firsthand knowledge about the company and its activities from various top notches of the organization. I also got an opportunity to attend Open Forum in the company, which was very helpful and informative. I got an opportunity to work with the HR team. I had hands on experience of various functions of the HR department. Here, I learned to associate my academic knowledge with practical experience. The company gave me an opportunity to do a study on the effectiveness of the Performance Management System. During the study, I learnt the complete process and gained a lot of useful insights on the performance management system. The study helped me to gain knowledge and exposure about the Performance Management System and its effectiveness.

Thus, the internship program provided me the platform to learn and experience the real business world and will now help me in better understanding of my academic subjects where I would be able to associate them with reality. The internship program was an enriching experience indeed.

QUESTIONNAIRE Dear Sir/ Madam, I am currently conducting a study about the Performance Management System of this organization. This is a Part of my studies in PGDM Programme. Your answers will be used for research only. Please be honest. Name Department

1. Are you familiar with the process of Performance Management System? (a) Yes (b) No

2. What is your perception regarding PMSs, is it simple? (a) Yes (b) No

3. Are you satisfied with the current PMS? (a) Yes (b) No

4. Are you satisfied with rating system? (a) Yes (b) No

5. Are you get motivated from the recognition given to high performers? (a) Yes (b) No

6. Do you feel that the PMS is biased? (a) Yes (b) No

7. Do you get the opportunity to take part in goal setting? (a) Yes (b) No

8. Do you think that Line managers always discuss performances and targets with you? (a) Yes (b) No

9. Do you think that employees are empowered and have the autonomy to plan, organize and do the work? (a) Yes (b) No

10. Who should do the appraisal? (a) Superior (b)Subordinate (c)Self Appraisal (d)Consultant (e)All of the above

11. Employees timely get automatic E-Mail reminders, and prompts, when targets are due. (a) Agree (b) Disagree

12. Compensation on the basis of the performance evaluation creates disputes in the organization. (a) Agree (b) Disagree

14. Does appraisal help in polishing skills and performance area? (a) Yes (b) No

15. Does personal creeps-in while appraising an employee? (a) Yes (b) No

BIBLIOGRAPHY

Websites:
www.google.com www.wikipedia.com www.pyrotechindia.com
www.googlescholar.com

Books:
C. R. Kothari Research Methodology Human Resource Management- T N Chhabra