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01. PURPOSE OF THE ASSIGNMENT


The organizations use performance evaluation as a basis for Human Resources activities.
Performance Evaluation provide a set of information needed to perform successfully many
functions leading to management of employees as employee hiring, selection, training,
promotion, transfers.
This assignment focuses on holding a discussion with a reputed company in order to identify
and get sound knowledge about how they evaluate employees performance and how the
theory is practically applied. Our ultimate objective to do this assignment is to provide an
ideal study about performance evaluation of our selected company under the below
categories.
Role of HR department
Existing performance evaluation procedure.
Methods use for appraisal task.
Usage of performance evaluation for decision making
Strengths and weaknesses of the existing methods.

To achieve the above purposes we selected Koggala Garments (PVT) Ltd and interviewed the
HR manager of it. We have produced a complete analyze using the knowledge of Human
Resources Management.
1.1 INTRODUCTION TO THE ORGANIZATION
History and Evaluation
Hoodvian Limited is a group of companies with its head quarters based in Hong Kong and
consisting of factories in Sri Lanka and India, producing a wide range of apparel categories
which are sold for world recognized brands and retailers in America, England and Europe.
The group consists of six cut and sewing factories, one washing and finishing plant, one
sweater factory and one socks factory from which only one cut and sewing factory and the
socks factory is situated in India where as all other factories are in Sri Lanka.
Koggala Garments (Pvt) Limited
Koggala Garments (Pvt) Limited, member of Hoodvian Limited was established in 1991 and
located in the Export Processing Zone of Koggala, Sri Lanka. It is one of the cut and sewing

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factories of Hoodvian Limited. The operation commenced with 5 lines of 40 machines, cadre
of 450. The total operation was housed in one building and the capacity was 100,000 pcs per
month. Currently separate functions are housed in 3 buildings namely, K1 Sewing, packing
and finishing, K2- Main fabric stores/ Cutting process/ Fabric inspection, K3 Accessory
stores/ finished goods. They have further extended the manufacturing unit in 2009 by adding
2 lines at a factory outside the zone area. Presently the capacity of Koggala Garments is 1.45
M pcs Underwear, 1.2 M pcs knit tops and bottoms and 0.31 M pcs Body/Sleep suits.
Mission Statement
Our Mission at HOODVIAN is to become the leading apparel manufacturer in Sri Lanka
and establish ourselves as reliable, flexible and high quality Multi Product manufacturer in
the global apparel market, producing garments, tops & bottoms in knit & woven, for men,
women, children & infants, for leading brands in the world.
We shall continue to invest in our highly talented & dedicated workforce and provide them
the most satisfying working conditions creating a highly motivated HOODVIAN TEAM that
will maximize returns to our shareholders and be a globally recognized force in apparel
manufacturing that will always adhere & respect Global Compliance Standards in Human
Rights, Employee safety & be an Environmental Friendly Organization.
Products and Market focus
Koggala Garments produces a wide range of apparel categories for men, women, boys, girls
and infants. At the inception they manufactured only Denims, Ladies Blouses and jackets but
have achieved expertise in Sleepwear, Underwear, Body suits and Sleep suits too. Their
production focuses 100% for Export only. The major markets they serve are America,
England and Europe. These markets include world recognized Brands and Retailers such as :
Gap, Old Navy, Liz Claiborne, Express, Ralph Lauren, Urban Outfitters, Carol Hochman,
Next, Espirit, Tesco and etc.
Role of Human Resources Department
There are about 2500 non managerial employees working currently from which 1/3 are men.
This is the only garment in Sri Lanka which has a huge number of men workers. As s result
of this high discipline has to be maintained because of the high possibility of arising conflicts.
One of the inevitable conditions in the garment industry is the high labor turn over which
always need replacement as soon as possible to make sure the smooth functioning of the

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operations. Not only that employee welfare, food, transport, health & safety, grievance
handling, compliance with rules & regulations are highly essential. Thus the Human
Resource Department Plays a vital role in the organization through handling these matters.

Organizational Structure






















Salary &
Payroll
Employee Health
& Safety
Compliance
Audit
Compliance
Manager
Administration
Manager

HR Manager
Cutting
Sewing Finishin
g
HR Department
Merchandising
Technical
/ Sample
Planning
IE
Q.A/ Process
Operations Manager



GM

Industrial
Relations
Work Study
Unit
Employee
Welfare

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02. EXISTING PERFORMANCE EVALUATION PROCEDURE
2.1 Objectives of Performance Evaluation at Koggala Garments
Overall objectives of the Performance Evaluation are as follows;
Improve the overall efficiency of the organization
Koggala Garments improve the overall efficiency of the organization by getting the highest
commitment and loyalty towards organizational goals and objectives.
Develop new competencies of employees
The organization expects from their performance evaluation system not only to appraise
existing competencies of their workforce but also encouraging employees to acquire new
competencies taking them at a higher status.
Therefore, Koggala Garments has established its own slogan under this objective as Every
day little up. Its meaning is until employees take the first step, it will not be possible to see
the next step. (Refer Appendix No. 01 in page 1)
To offer Incentives and Promotion
Attractive incentive and promotion package has been set up for rewarding employees those
who are reached to the standard level.
Maintain high level of discipline among employees
The organization expects to maintain standard level of self-discipline from each individual
employee. Employees are encouraged to dress in a formal uniform at the work place as an
initial stage of the self-discipline. Hence employees from managerial level to shop floor level
wear formal dress code in same color without any difference in their positions.
Continuous Career Development
Koggala Garments expects implementing performance evaluation to enhance employees
career development and therefore the organization have clear career path under theme of
experience comes first. According to this theme machine operators have a great career
prospects to move until become a production manager of the organization in their experience.


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2.2 Performance Evaluation Policy at Koggala Garments
Even though there is no any written policy document for performance evaluation at Koggala
Garments, they have well established and separate practices for assessing performance for
each employee category as: Functional and middle Managers, Executives and Clerical Staff
and Shop floor workers.
Functional and middle Managers
The organization evaluates the performance of managerial personnel in annual basis. Top
management of Hoodvian group considers the overall performance of the organization when
evaluating the performance of particular functional and middle managers.
For an instance: Functional and middle managers are evaluated on to what extent they give
their maximum contribution for meeting annual profit targets, organizing resource for
scheduled time to deliver orders of the customers, arranging organizational layout for
enhancing efficiency and reducing labor turnover and absenteeism.
According to the overall performance of the organization, functional and middle managers
are given attractive salary increments and other benefits, further promotions to move for
higher positions and overseas tours.
Executives and Clerical Staff
This category of employees is evaluated by functional managers in each work division to
ensure how well they accomplish their assigned tasks.
For an instance: They are expected to reduce absenteeism and presenteeism in the production
line, proper management of supply chain, handling employees efficiency, responsibility of
quality products and maintaining smooth production process.
According to the particular functional managers recommendation, above personnel received
financial and non financial benefits for successfully carrying out their assigned tasks.
Shop Floor Workers
Shop floor level workforce is the heart of the production process who contributes to the
overall efficiency by continuously improving their skills and competencies. Performance
evaluation plays a major role in order to gain smooth production flow while motivating

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workers and gaining their maximum commitment to achieve organizational corporate goals
and objectives.
Performance evaluation for shop floor level has been set as follows;
Hiring
Performance evaluation starts from the hiring process at Koggala Garments. The organization
hires skilled and unskilled labor on permanent basis with six months (156 working days)
probationary period. Koggala Garments used to permanent new workers after two months in
their probationary period by conducting practical test for probationers. In this practical test
supervisors observe probationers ability to work with six machines, meeting expected pieces
within standard time and how well particular person adapting to the organizational
environment. Those who are successfully completed the practical test immediately placed as
permanent workers. Salary increments and other benefits provide after the six months time
even though probationer considered as a permanent employee after two months in his/her
ability.
Maintaining Performance
Final output of Koggala Garments derived as a result of division of labor. There are 50
production lines which consisting 25 sewing machines per line. Each production line divides
in to four quality circles and one most outstanding employee is being selected as a Quality
Leader. Quality leader is responsible for managing six to seven peers while maintaining
standard quality. Line supervisors have been appointed for each two of production lines who
are expected to be reported to Senior Production Manager.
Line Supervisors are immediate bosses of each two lines for evaluating employees
efficiency. Performance evaluation will be depending on the placement of the customer order
and the efficiency of final output.
Working department is always providing guidelines and instructions for supervisors to
evaluate floor level employees. They set target by considering hours of work, piece rate and
efficiency rate for each production line to make sure targets achieved under the supervision of
supervisors.


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2.3 Performance Criteria and Standards
Koggala Garments identify successful job performers by measuring performance of
employees especially shop floor level workers using specific criteria giving the basic priority
for high level of efficiency.
Standard Minute Value (SMV)
The organization calculates SMV based on the product they are going to be produced. SMV
consists of Basic Time and Allowances which represents the pre determined time requirement
to finish each part of the product. Therefore employees are expected to cover the targets
while fulfilling the SMV. This criteria lead to set targets as well as measure employees
performance emerging their efficiency. Line output is calculated using SMV as follows;
Line output = Total SMV x Number of workers
Using efficiency calculated data employees are graded as Grade I, II, III and IV. Efficiency
will be calculated as follows;


The organization expects 65% average efficiency rate to keep up daily production process
smoothly. Higher efficiency rate more than 65% will be reimbursed by financial and non
financial benefits.
Quality of Work
The ultimate quality target at Koggala Garments is Zero defects. They always try to minimize
defects and passing defected parts to another person. Line managers identify the hard tasks in
the production lines which have high chance of producing defected items (representing red
color products specifications) and engage more close supervision for it. Every three months
per year the organization selects the best production line which has minimum defects with
higher quality by rewarding all employees in the line.
Personal Quality
Koggala Garments has established criteria for developing its work force using the concept of
building Level 5 leaders. (Refer appendix No. 02)
Efficiency = Produced Time x 100
Available Time

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Level 5 Leaders = Humility + Will
Employees are encouraged to become Level 5 Leaders developing following qualities within
themselves while enjoying higher salary and benefits.
1. Persistent 6. Honest
2. Humble 7. Selfless
3. Focused 8. Confident
4. Driven 9. Dutiful
5. Instinctual 10. Determined
The organization has set a slogan on the basis of this concept;
We dont just make garments, we make People
Punctuality and Attendance
Work on time and every day working are other established criteria at Koggala Garments.
They reward Best Attendant and Most Disciplined Employee for encouraging them to
work more loyalty.














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03. METHODS USED FOR APPRAISAL TASK
When we are concerning about Koggala garments (PVT) Ltd, there are various positions
such as;
Machine Operators
Quality circle Leaders
Line Leaders
Supervisors
Managers
In addition to that, even machine operators can be categorized under various grades. Grade 1
to grade IV, but if any of the machine operator exceeds the expected level of Grade IV, then
they are promoted to the Level 5 therefore, the evaluation methods of machine operators
are differ according to the grades & levels. For the purpose of performance evaluation, there
is a department called Work study department and it is conducting under the supervision of
HR manager. In this garment factory there are 4 floors and each floor, there is a work study in
charge & a work study officer to evaluate the performance. There are several performance
evaluation methods for managerial and non managerial positions. They can be listed as
follows;
Machine operators
Generally machine operators performances are evaluated hourly by using Hourly
production plan, each and every employee are given a target to achieve within an hour.
Their performance are appraised through the pieces and the quality of the pieces, this
differ with the orders.
There are grading tests, which include practical tests and exams.
Line Leaders
The performances of line leaders are appraised by supervisors. The method they are using
for that purpose is ,
o Responsibility to give a perfect output from his or her section.
o Minimizing the rate of absenteeism.
According to Koggala Garments, Level 5 Leaders are, fanatically driven, infected within
incurable need to produce sustained results. They are resolved to do whatever it takes to
make the company great, no matter how big or hard the decisions are.

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Supervisors
Statistical Process Control Chart
From this method, supervisors are evaluated by the products which are produced through his
line & the number of defected items, Also it shows how did the mistake was happened & how
to correct that error.
Bundle System
Depending on the bundles issued through the supervisor is taking in to consideration when
evaluating his performances (A bundle contains 50 pieces).
Senior production manager is supervising the supervisors by asking information about
last operations, daily at 2-3 p.m, they are responsible to report to the senior production
manager.
Managers
Managerial performances are evaluated by the GM & CEO themselves. When they are
evaluating managers, generally taking in to consideration.
o Attitudes
o Target achievements
o Effectiveness
This process is not visible to managers.
Charts used for Evaluation Purpose
Mock up Operation Specification
This chart is used to evaluate the achieved level of established targets.
Follow up Charts
This is a detailed board use to exhibit important details which need for the evaluation
purpose. (Refer Appendix No 03)
Attribute Control Chart
This is a detailed chart explaining the role of line leaders and hourly targets to be met. (Refer
Appendix No 04)


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04. USAGE OF PERFORMANCE EVALUATION FOR DECISION MAKING
PROCESS
After discussing results of appraisal then Koggala Garments moves to the last step of the
process is to take decisions which can be taken either to improve the performance of the
employee, take the required corrective actions, or the related HR decisions like reward,
promotions, demotions, transfers, etc. Employees are a given period of time and provide
clarity of the expectations and responsibilities of the functions to be performed by the
employee. To satisfying these aims Koggala Garment use several methods to collect the
information, they use handbooks, leaflets, and data base system to collect data.
The rapid developments in IT have not left any sphere of the human work life untouched. The
organization are growing in size, functions, are working areas nations and thus are becoming
more and more complex to handle. There is about 2300 workers work in the Koggala
Garments, because of this purpose Koggala Garment keeps a distinct data base system to
measure and manage employee performance. It helps to collect data in automate the
processes of performance evaluation and save time and cost reduce the effort required and the
paper work.
The information is systematically stored in metrics where the current employee performance
can be compared with the target and the standards. Koggala Garment also uses a bundle
system to collect the data about the supervisors performance, these information help to
evaluate the performance of supervisors.
After collecting information, they use this information to several purposes. This information
is highly involved in decision making.







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According to the Koggala Garment, the percentage of Garment (out of the total garment
surveyed i.e. 50) using performance evaluation information for the various purposes are as
shown in the diagram below

The most significant reasons of using performance evaluation information are
Making payroll and compensation decisions- 80%
Training and development needs- 78%
Identifying the gaps in desired and actual performance and it cause- 76%
Deciding future goals and course of actions- 42%
Promotions, demotions and transfers- 35%
Other purposes (including job analysis, and providing superior support, assistance and
counseling)- 6%
Collected information about performance evaluation can significantly help in decision
making. These information help to reveal when deciding making payroll and compensation
decisions, Training and development needs, identifying the gaps in desired and actual
performance and etc. After the getting these decisions can help in judging the effectiveness of
the performance evaluation process.




Making payrolland
compensation decisions
Training and developments
needs
identidying the gaps in
desired and actual
performance
Deciding future goals and
course of actions
promotions and transfers

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05. STRENGTHS AND WEAKNESS OF THE EXISTING PEFORMANCE
EVALUATION METHODS
Koggala Garments (Pvt) Ltd mainly uses Supervisory appraisal methods to evaluate their
employees performance. We can identify several strengths, as well as weaknesses in those
methods;
Strengths
Increase the efficiency of employees
The evaluation methods in Koggala Garment, helps to increase the efficiency of employees.
They evaluate their employees performance based on the output they produced. In other
words, it based on their efficiency. Hence, employees have to work efficiently, without
idling. Otherwise their performance will be evaluated as unfavorable and they will have no
any increments. Therefore, employees always do their works efficiently and it will help to
increase the overall efficiency of the organization.
Motivate employees and improve their moral
These evaluation methods are always motivate their employees and help to improve their
moral. Employees know that, if they perform well within their group, they can be the leader
of that group (quality circle leader). As well, those leaders are given an increment. These are
help to motivate the employees to perform successfully.

Present a clear career path to the employees and help the personal development
These evaluation methods present a clear career path to the employees and help the personal
development of employees. A person, who joined as a machine operator, can become a
managerial level employee even. If an employees performance is evaluated as favorable, he
can be the quality circle leader, line leader and so on. Hence, it helps to the career
development of employee. They exactly know that, they have a clear career path if they
perform well. They know that they can go to the top based on their evaluated performance.
As well, it helps to the personal development of employees such as improving the leadership
skills.
Help to reduce the absenteeism
Supervisors are responsible to maintain the absenteeism rate in a lower level. When
evaluating the supervisors performance, absenteeism rate is also considered,. Hence,
supervisors always discuss with their subordinates and try to minimize the absenteeism rate
of them.
Help to reduce the labor turnover
In a garment sector, labor turnover is relatively high. But Koggala Garment was able to
reduce it because employees know that they have a clear career path and personal
development, if they perform well. They know that they can go to the top based on the results

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of their performance evaluation. Hence, employees are willing to work in the Koggala
Garment for a long period of time.
Unfavorable results of evaluations are directly reported to the management
In Koggala Garment, the unfavorable results of performance evaluation of employees are
directly informed to the managerial level. Hence, if employees have some special reason for
their poor performance, they can inform their problems to the management and discuss with
them and get a better solution. Thatll be strength to those who have problems.
Weaknesses
Stereotype evaluations can be occurred
Sometimes there may be stereotype evaluations, especially in managerial level evaluation.
GM and CEO evaluate the managers performance by looking at the way they handle their
works, cope with others. Hence, if GM or CEO has personal preferences for some managers,
that will be affect to the evaluations of their performance and stereotype evaluations may be
occurred.
Halo effect
If supervisors observe a one mistake of an employees performance, then the supervisor will
always focus only on that mistake and evaluate his performance as unfavorable. This may be
affect to the future evaluations of their performance also.
Lack of visibility in managerial appraisal
Managers performances are evaluated by the GM and CEO, by looking at the way they
handle their works, the way they cope with others and their attitudes. Then they (GM and
CEO) discuss with each other and evaluate the performance of the managers and inform them
only the result. Hence, Managers dont know how their superiors evaluate their performance.
Because the evaluating ways are not visible to the managers.








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5.1 Suggestions and Recommendations
Performance evaluation is a necessary and beneficial process, which provides annual
feedback to staff members about job effectiveness and career guidance. In dealing with the
performance appraisal system of Koggala Garments, it is better if they can scrupulously
concern on, whether the ongoing self and supervisory appraisal system, to floor area
employees are totally free from bias. Also it is enhanced, if the HR department should make
sure the recommended trainings are implemented and it must be made sure that the ratings
reflect the actual performance of the employees.
Currently the organization faces approximately 100-200 of average monthly labor turn over
and it is effective if they could reduce it together with absenteeism as motivating the
employees not even to quality circle, floor area, and supervisory level but also to managerial
level.
The performance evaluation for managerial level employees of Koggala Garment Pvt Ltds is
done in an invisible manner. But its recommended if they can implement visible method
such as 360
0
appraisal method, MBO method, as good MBO system with specific measurable
goals avoid many measurement problems and use of modern appraisal technique, such as
Performance management software. Also there should be performance managers & sub
department of performance management (under HR) which should take appraisals to non-
managerial as well as managerial level employees, during whole year.
It is suitable to maintain a written policy document for performance appraisal together with
proper action plan which cover both managerial and non managerial employees. From a cost
viewpoint this may not sound like a reasonable idea, but to get the best results, better if use a
standardized written forms for appraisals. An appraisal form should cover the results
achieved, quality of performance, volume of work, effectiveness in working with others in
the work place and with clients and suppliers, in initiative, job knowledge, and dependability.
Employment services, trade associations, and some office supply stores can provide
standardized performance appraisal forms.




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CONCLUSION
Koggala Garment (PVT) Ltd is one of the leading and outstanding Garment in the textile
industry. The success behind their progress is achieved by treating its workforce as the heart
of the organization. All organization efforts are catering to build educated Multi Task
efficient workforce while keeping up its production smoothly
Performance appraisal plays a major role at Koggala Garment. Current Performance
evaluation procedure targets to improve the overall efficiency of the organization, develop
new competences of employees, offer incentives and promotions, maintain higher level of
discipline among employees, judge the gap between actual performance level and desired
performance level and identifying strengths and weaknesses of employees. By using these,
management develops employee strength and reduces the weaknesses.
It is apparent to us, that Performance evaluation practices are heavily focused on shop floor
level employees, expecting high efficiency from them. Supervisor appraisal can be seen as
the main appraisal method. By appointing one supervisor for each two production lines,
organization expects to observe whether the targets are achieved within the standard
efficiency rate.
Quality of decisions and the successfulness of the decisions are the basis of evaluation of
managerial level performance. These appraisals cannot be directly identified. But the ultimate
output of performance of managerial level are viewing as higher profit level, reduction labour
turnover and absenteeism etc.
Organization uses several methods to collect data of performance evaluation. They are
handouts, leaflets and database system. By using these things, they take several decisions
such as making payroll and compensation decisions, training and development needs,
deciding future goals and cause of actions etc.
Finally, we could understand how current performance evaluation procedure is practically
implementing in Koggala Garments while facing the critical circumstances in the industry.