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INTRODUCTION TO THE TOPIC

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PERFORMANCE APPRAISAL

Performance Appraisal is the systematic evaluation of the performance of employees and to


understand the abilities of a person for further growth and development. Performance appraisal is
generally done in systematic ways which are as follows:
 The supervisors measure the pay of employees and compare it with targets and plans.
 The supervisor analyses the factors behind work performances of employees.
 The employers are in position to guide the employees for a better performance.

Performance appraisal is the process of obtaining, analyzing and recording information about the
relative worth of an employee. The focus of the performance appraisal is measuring and
improving the actual performance of the employee and also the future potential of the employee.
According to Flippo, a prominent personality in the field of Human resources, "performance
appraisal is the systematic, periodic and an impartial rating of an employee’s excellence in the
matters pertaining to his present job and his potential for a better job." Performance appraisal is a
systematic way of reviewing and assessing the performance of an employee during a given
period of time and planning for his future. It is a powerful tool to calibrate, refine and reward the
performance of the employee. It helps to analyze his achievements and evaluate his contribution
towards the achievements of the overall organizational goals.

By focusing the attention on performance, performance appraisal goes to the heart of personnel
management and reflects the management's interest in the progress of the employees

OBJECTIVES OF PERFORMANCE APPRAISAL

Performance Appraisal can be done with following objectives in mind:

 To maintain records in order to determine compensation packages, wage structure,


salaries raises, etc.
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 To identify the strengths and weaknesses of employees to place right men on right job.

 To maintain and assess the potential present in a person for further growth and
development.

 To provide a feedback to employees regarding their performance and related status.

 To provide a feedback to employees regarding their performance and related status.

 It serves as a basis for influencing working habits of the employees.

 To review and retain the promotional and other training programmes.

ADVANTAGES OF PERFORMANCE APPRAISAL

It is said that performance appraisal is an investment for the company which can be justified by
following advantages:

 Promotion

 Compensation

 Employees Development

 Communication

 Motivation

 Other

o Through performance appraisal, the employers can understand and accept skills of
subordinates.

o The subordinates can also understand and create a trust and confidence in
superiors.

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o It also helps in maintaining cordial and congenial labor management relationship.

o It develops the spirit of work and boosts the morale of employees.

APPRAISAL PROCESS

OBJECTIVES OF PERFORMANCE APPRAISAL

ESTABLISH JOB EXPECTATIONS

DESIGN AN APPRAISAL PROGRAM

APPRAISE PERFORMANCE

PERFORMANCE INTERVIEW

ARCHIVE APPRAISAL DATA

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USE APPRAISAL DATA FOR APPRAISAL PURPOSES
METHODS OF PERFORMANCE APPRAISAL

The performance appraisal methods may be classified into three categories, as shown in Figure
below.

INDIVIDUAL EVALUATION METHODS


Under the individual evaluation methods of merit rating, employees are evaluated one at a time
without comparing them with other employees in the organization.

(a) Confidential report: It is mostly used in government organizations. It is a descriptive report


prepared, generally at the end of every year, by the employee's immediate superior. The report
highlights the strengths and weaknesses of the subordinate. The report is not databased. The
impressions of the superior about the subordinate are merely recorded there. It does not offer any
feedback to the appraisee. The appraisee is not very sure about why his ratings have fallen
despite his best efforts, why others are rated high when compared to him, how to rectify his
mistakes, if any; on what basis he is going to be evaluated next year, etc. Since the report is
generally not made public and hence no feedback is available, the subjective analysis of the
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superior is likely to be hotly contested. In recent years, due to pressure from courts and trade
unions, the details of a negative confidential report are given to the appraisee.

(b) Essay evaluation: Under this method, the rater is asked to express the strong as well as weak
points of the employee's behavior. This technique is normally used with a combination of the
graphic rating scale because the rater can elaborately present the scale by substantiating an
explanation for his rating. While preparing the essay on the employee, the rater considers the
following factors:

(i) Job knowledge and potential of the employee

(ii) Employee understands of the company's programs, policies, objectives, etc.

(iii) The employee's relations with co-workers and superiors

(iv) The employee's general planning, organizing and controlling ability

(v) The attitudes and perceptions of the employee, in general.

Essay evaluation is a non-quantitative technique. This method is advantageous in at least one


sense, i.e., the essay provides a good deal of information about the employee and also reveals
more about the evaluator.

(c) Critical incident technique: Under this method, the manager prepares lists of statements of
very effective and ineffective behavior of an employee. These critical incidents or events
represent the outstanding or poor behavior of employees on the job. The manager maintains logs
on each employee, whereby he periodically records critical incidents of the workers behavior. At
the end of the rating period, these recorded critical incidents are used in the evaluation of the
workers' performance.

An example of a good critical incident of a sales assistant is the following:

July 20 – The sales clerk patiently attended to the customer’s complaint. He is polite, prompt,
and enthusiastic in solving the customers' problem.

On the other hand the bad critical incident may appear as under:

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July 20 – The sales assistant stayed 45 minutes over on his break during the busiest part of the
day. He failed to answer the store manager's call thrice. He is lazy, negligent, stubborn and
uninterested in work..

(d) Checklists and weighted checklists: Another simple type of individual evaluation method is
the checklist. A checklist represents, in its simplest form, a set of objectives
or descriptive statements about the employee and his behavior. If the rater believes strongly that
the employee possesses a particular listed trait, he checks the item; otherwise, he leaves the item
blank. A more recent variation of the checklist method is the weighted list. Under this, the value
of each question may be weighted equally or certain questions may be weighted more heavily
than others. The following are some of the sample questions in the checklist.

1. Is the employee really interested in the task assigned? Yes/No

2. Is he respected by his colleagues (co-workers) Yes/No

3. Does he give respect to his superiors? Yes/No

4. Does he follow instructions properly? Yes/No

5. Does he make mistakes frequently? Yes/No

A rating score from the checklist helps the manager in evaluation of the performance of the
employee. The checklist method has a serious limitation. The rater may be biased in
distinguishing the positive and negative questions. He may assign biased weights to the
questions. Another limitation could be that this method is expensive and time consuming.
Finally, it becomes difficult for the manager to assemble, analyze and weigh a number of
statements about the employee's characteristics, contributions and behaviors. In spite of these
limitations, the checklist method is most frequently used in the employee's performance
evaluation.

(e) Graphic rating scale: Perhaps the most commonly used method of performance evaluation
is the graphic rating scale. Of course, it is also one of the oldest methods of evaluation in use.

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Under this method, a printed form, as shown below, is used to evaluate the performance of an
employee. A variety of traits may be used in these types of rating devices, the most common
being the quantity and quality of work. The rating scales can also be adapted by including traits
that the company considers important for effectiveness on the job.

(f) Behaviorally anchored rating scales: Also known as the behavioral expectations scale, this
method represents the latest innovation in performance appraisal. It is a combination of the
rating scale and critical incident techniques of employee performance evaluation. The critical
incidents serve as anchor statements on a scale and the rating form usually contains six to eight
specifically defined performance dimensions. The following chart represents an example of a
sales trainee's competence and a behaviorally anchored rating scale.

(g)Forced choice method: This method was developed to eliminate bias and the preponderance
of high ratings that might occur in some organizations. The primary purpose of the forced choice
method is to correct the tendency of a rater to give consistently high or low ratings to all the
employees. This method makes use of several sets of pair phrases, two of which may be positive
and two negative and the rater is asked to indicate which of the four phrases is the most and least
descriptive of a particular worker. Actually, the statement items are grounded in such a way that
the rater cannot easily judge which statement applies to the most effective employee. The
following box is a classic illustration of the forced choice items in organizations.

Table: Forced Choice Items

1. Least Most

A Does not anticipate difficulties A

B Grasps explanations easily and quickly B

C Does not waste time C

D Very easy to talk to D

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2. Least Most

A Can be a leader A

B Wastes time on unproductive things B

C At all times, cool and calm C

D Smart worker D

The favorable qualities earn a plus credit and the unfavorable ones earn the reverse. The worker
gets over plus when the positive factors override the negative ones or when one of the negative
phrases is checked as being insignificantly rated.

They overall objectivity is increased by using this method in evaluation of employee's


performance, because the rater does not know how high or low he is evaluating the individual as
he has no access to the scoring key. This method, however, has a strong limitation. In the
preparation of sets of phrases trained technicians are needed and as such the method becomes
very expensive. Further, managers may feel frustrated rating the employees ‘in the dark'. Finally,
the results of the forced choice method may not be useful for training employees because the
rater himself does not know how he is evaluating the worker. In spite of these limitations, the
forced choice technique is quite popular.

(h) Management by Objectives (MBO): MBO represents a modern method of evaluating the
performance of personnel. The concept of management by objectives is actually the outcome of
the pioneering works of Drucker, McGregor and Odiorne in management science. Management
by objectives can be described as “a process whereby the superior and subordinate managers of
an organization jointly identify its common goals, define each individuals' major areas of
responsibility in terms of results expected of him and use these measures as guides for operating
the unit and assessing the contributions of each of its members”. MBO thus represents more than
an evaluation program and process. Practicing management scientists and pedagogues view it as
a philosophy of managerial practice; it is a method by which managers and subordinates plan,
organize, control, communicate and debate.
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MULTIPLE PERSON EVALUATION METHODS

a) Ranking Method: The ranking system requires the rater to rank his subordinates on overall
performance. This consists in simply putting a man in a rank order. Under this method, the
ranking of an employee in a work group is done against that of another employee. The relative
position of each employee is tested in terms of his numerical rank. It may also be done by
ranking a person on his job performance against another member of the competitive group.

b) Forced Distribution method: This is a ranking technique where raters are required to
allocate a certain percentage of rates to certain categories (e.g. superior, above average, average)
or percentiles (e.g. top 10 percent, bottoms 20 percent etc). Both the number of categories and
percentage of employees to be allotted to each category are a function of performance appraisal
design and format. The workers of outstanding merit may be placed at top 10 percent of the
scale; the rest may be placed as 20 % good, 40 % outstanding, 20 % fair and 10 % fair.

c) Paired comparison method: Paired comparison analysis is a good way of weighing up the
relative importance of options a better technique of comparison than the straight ranking
method; this method compares each employee with all others in the group, one at a time. After
all the comparisons on the basis of the overall comparisons, the employees are given the final
rankings.

Employee Reactions to Performance Appraisal

Numerous researchers have reported that many employees are not satisfied with their
performance appraisal (PA) systems. Studies have shown that subjectivity as well as
appraiser bias is often a problem perceived by as many as half of employees. Appraiser bias,
however, appears to be perceived as more of a problem in government and public sector
organizations. Also, according to some studies, employees wished to see changes in the PA
system by making “the system more objective, improving the feedback process, and increasing
the frequency of review.” In light of traditional PA operation defects, “organizations are now
increasingly incorporating practices that may improve the system. These changes are particularly

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concerned with areas such as elimination of subjectivity and bias, training of appraisers,
improvement of the feedback process and the performance review discussion.”

According to a meta-analysis of 27 field studies, general employee participation in his/her own


appraisal process was positively correlated with employee reactions to the PA system. More
specifically, employee participation in the appraisal process was most strongly related to
employee satisfaction with the PA system. Concerning the reliability of employee reaction
measures, researchers have found employee reaction scales to be sound with few concerns
through using a confirmatory factor analysis that is representative of employee reaction scales.

Researchers suggest that the study of employees’ reactions to PA is important because of two
main reasons:

 Employee reactions symbolize a criterion of interest to practitioners of Pas

 Employee reactions have been associated through theory to determinants of appraisal


acceptance and success.

Researchers translate these reasons into the context of the scientist-practitioner gap or the “lack
of alignment between research and practice.”

Therefore, the performance appraisal process often is stressful for both employers and
employees. Workers often are afraid of being judged and sometimes fear they will be misjudged
for the wrong reasons. Managers and supervisors, especially those who have a strong need to be
liked, might not want to tell workers when they are performing poorly. However, it is important
to be objective and truthful during the appraisal process if you want to improve an employee's
performance. It also is important to give employees the opportunity to express their reactions to
the performance appraisal in a positive manner, whether the specific reaction itself is positive or
negative.

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INDUSTRY PROFILE

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PROFILE OF THE BANKING SECTOR

A bank is a financial institution that provides banking and other financial services to their
customers. A bank is generally understood as an institution which provides fundamental banking
services such as accepting deposits and providing loans. There are also nonbanking institutions
that provide certain banking services without meeting the legal definition of a bank. Banks are a
subset of the financial services industry. The banking system in India, should not only be hassle

free but it should be able to meet the new challenges posed by the technology and any other
external and internal factors. For the past three decades, India’s banking system has several
outstanding achievements to its credit.

Need of the Banks

 To provide the security to the savings of customers.


 To control the supply of money and credit.
 To encourage public confidence in the working of the financial system, increase
 savings speedily and efficiently.
 To avoid focus of financial powers in the hands of a few individuals and
 institutions.
 To set equal norms and conditions (i.e. rate of interest, period of lending etc) to all types
of customers.
History of Indian Banking System

The first bank in India, called The General Bank of India was established in the year 1786. The
East India Company established The Bank of Bengal/Calcutta (1809), Bank of Bombay (1840)
and Bank of Madras (1843). The next bank was Bank of Hindustan which was established in
1870. Allahabad Bank which was established in 1865, was for the first time completely run by
Indians. Between 1906 and 1913, Bank of India, Central Bank of India, Bank of Baroda, Canara
Bank, Indian Bank,and Bank of Mysore were set up.

Between 1913 and 1948 there were approximately 1100 small banks in India. Reserve Bank of
India was vested with extensive powers for the supervision of banking in India as a Central

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Banking Authority. After independence, Government has taken most important steps in regard of
Indian Banking Sector reforms. In 1955, the Imperial Bank of India was nationalized and was
given the name "State Bank of India", to act as the principal agent of RBI and to handle banking
transactions all over the country. It was established under State Bank of India

Act, 1955. Seven banks forming subsidiary of State Bank of India was nationalized in 1960. On
19th July, 1969, major process of nationalization was carried out. At the same time 14 major
Indian commercial banks of the country were nationalized. In 1980, another six banks were
nationalized, and thus raising the number of nationalized banks to 20. Seven more banks were
nationalized with deposits over 200 Crores.. On the suggestions of Narsimhan Committee, the
Banking Regulation Act was amended in 1993 and thus the gates for the new private sector
banks were opened.

The following are the major steps taken by the Government of India to Regulate Banking
institutions in the country:-

1949 : Enactment of Banking Regulation Act.

1955 : Nationalisation of State Bank of India.

1959 : Nationalization of SBI subsidiaries.

1961 : Insurance cover extended to deposits.

1969 : Nationalisation of 14 major Banks.

1971 : Creation of credit guarantee corporation.

1975 : Creation of regional rural banks.

1980 : Nationalisation of seven banks with deposits over 200 Crores

Banking in India in the modern sense originated in the last decades of the 18th century. Among
the first banks were the Bank of Hindustan, which was established in 1770 and liquidated in
1829-32; and the General Bank of India, established in 1786 but failed in 1791.The largest bank,
and the oldest still in existence, is the State Bank of India (S.B.I). It originated as the Bank of

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Calcutta in June 1806. In 1809, it was renamed as the Bank of Bengal. This was one of the three
banks funded by a presidency government, the other two were the Bank of Bombay and the Bank
of Madras. The three banks were merged in 1921 to form the Imperial Bank of India, which upon
India's independence, became the State Bank of India in 1955. For many years the presidency
banks had acted as quasi-central banks, as did their successors, until the Reserve Bank of India
was established in 1935, under the Reserve Bank of India Act, 1934.In 1960, the State Banks of
India was given control of eight state-associated banks under the State Bank of India (Subsidiary
Banks) Act, 1959. These are now called its associate banks.[5] In 1969 the Indian government
nationalised 14 major private banks. In 1980, 6 more private banks were nationalised. These
nationalised banks are the majority of lenders in the Indian economy. They dominate the banking
sector because of their large size and widespread network.

The Indian banking sector is broadly classified into scheduled banks and non-scheduled banks.
The scheduled banks are those which are included under the 2nd Schedule of the Reserve Bank
of India Act, 1934. The scheduled banks are further classified into: nationalised banks; State
Bank of India and its associates; Regional Rural Banks (RRBs); foreign banks; and other Indian
private sector banks. The term commercial banks refers to both scheduled and non-scheduled
commercial banks which are regulated under the Banking Regulation Act, 1949.

Generally banking in India is fairly mature in terms of supply, product range and reach-even
though reach in rural India and to the poor still remains a challenge. The government has
developed initiatives to address this through the State Bank of India expanding its branch
network and through the National Bank for Agriculture and Rural Development with facilities
like microfinance.

During the First World War (1914–1918) through the end of the Second World War (1939–
1945), and two years thereafter until the independence of India were challenging for Indian
banking. The years of the First World War were turbulent, and it took its toll with banks simply
collapsing despite the Indian economy gaining indirect boost due to war-related economic
activities. At least 94 banks in India failed between 1913 and 1918 as indicated in the following
table:

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Years Number of banks Authorised Capital Paid-up Capital
that failed ( Lakhs) ( Lakhs)

1913 12 274 35

1914 42 710 109

1915 11 56 5

1916 13 231 4

1917 9 76 25

1918 7 209 1

(Tab-1)

Post-Independence

The partition of India in 1947 adversely impacted the economies of Punjab and West Bengal,
paralysing banking activities for months. India's independence marked the end of a regime of the
Laissez-faire for the Indian banking. The Government of India initiated measures to play an
active role in the economic life of the nation, and the Industrial Policy Resolution adopted by the
government in 1948 envisaged a mixed economy. This resulted into greater involvement of the
state in different segments of the economy including banking and finance. The major steps to
regulate banking included:

 The Reserve Bank of India, India's central banking authority, was established in April
1935, but was nationalised on 1 January 1949 under the terms of the Reserve Bank of
India (Transfer to Public Ownership) Act, 1948 (RBI, 2005b).[16]
 In 1949, the Banking Regulation Act was enacted which empowered the Reserve Bank of
India (RBI) "to regulate, control, and inspect the banks in India".
 The Banking Regulation Act also provided that no new bank or branch of an existing
bank could be opened without a license from the RBI, and no two banks could have
common directors.
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Nationalisation in the 1960s

Despite the provisions, control and regulations of the Reserve Bank of India, banks in India
except the State Bank of India (SBI), continued to be owned and operated by private persons. By
the 1960s, the Indian banking industry had become an important tool to facilitate the
development of the Indian economy. At the same time, it had emerged as a large employer, and a
debate had ensued about the nationalisation of the banking industry. Indira Gandhi, the then
Prime Minister of India, expressed the intention of the Government of India in the annual
conference of the All India Congress Meeting in a paper entitled "Stray thoughts on Bank
Nationalization." The meeting received the paper with enthusiasm.

Thereafter, her move was swift and sudden. The Government of India issued an ordinance
('Banking Companies (Acquisition and Transfer of Undertakings) Ordinance, 1969') and
nationalised the 14 largest commercial banks with effect from the midnight of 19 July 1969.
These banks contained 85 percent of bank deposits in the country. Jayaprakash Narayan, a
national leader of India, described the step as a "masterstroke of political sagacity." Within two
weeks of the issue of the ordinance, the Parliament passed the Banking Companies (Acquisition
and Transfer of Undertaking) Bill, and it received the presidential approval on 9 August 1969.

A second dose of nationalisation of 6 more commercial banks followed in 1980. The stated
reason for the nationalisation was to give the government more control of credit delivery. With
the second dose of nationalisation, the Government of India controlled around 91% of the
banking business of India. Later on, in the year 1993, the government merged New Bank of India
with Punjab National Bank. It was the only merger between nationalised banks and resulted in
the reduction of the number of nationalised banks from 20 to 19. After this, until the 1990s, the
nationalised banks grew at a pace of around 4%, closer to the average growth rate of the Indian
economy.

Liberalisation in the 1990s

In the early 1990s, the then government embarked on a policy of liberalisation, licensing a small
number of private banks. These came to be known as New Generation tech-savvy banks, and

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included Global Trust Bank (the first of such new generation banks to be set up), which later
amalgamated with Oriental Bank of Commerce, UTI Bank (since renamed Axis Bank), ICICI
Bank and HDFC Bank. This move, along with the rapid growth in the economy of India,
revitalised the banking sector in India, which has seen rapid growth with strong contribution
from all the three sectors of banks, namely, government banks, private banks and foreign banks.

The next stage for the Indian banking has been set up with the proposed relaxation in the norms
for foreign direct investment, where all foreign investors in banks may be given voting rights
which could exceed the present cap of 10% at present. It has gone up to 74% with some
restrictions.

The new policy shook the Banking sector in India completely. Bankers, till this time, were used
to the 4–6–4 method (borrow at 4%; lend at 6%; go home at 4) of functioning. The new wave
ushered in a modern outlook and tech-savvy methods of working for traditional banks. All this
led to the retail boom in India. People demanded more from their banks and received more.

Current period
Main article: List of Banks in India

The Indian banking sector is broadly classified into scheduled banks and non-scheduled
banks.All banks which are included in the Second Schedule to the Reserve Bank of India Act,
1934 are Scheduled Banks. These banks comprise Scheduled Commercial Banks and Scheduled
Co-operative Banks. Scheduled Co-operative Banks consist of Scheduled State Co-operative
Banks and Scheduled Urban Cooperative Banks.Scheduled Commercial Banks in India are
categorised into five different groups according to their ownership and/or nature of operation:

 State Bank of India and its Associates


 Nationalised Banks
 Private Sector Banks
 Foreign Banks
 Regional Rural Banks.

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INTRODUCTION TO THE INDIAN BANKING INDUSTRY

Major constituents of the Indian financial sector are banks, financial institutions, and markets,
which mobilize the resources from the surplus sector and channelize the same to the different
needy sectors in the economy. In fact, the Indian financial system is characterised by its two
major segments - an organized sector and a traditional sector that is also known as informal
credit market. Financial intermediation in the organized sector is conducted by a large number
of banks and financial institutions. Financial institutions are further classified based on their
mandate and activities, which may be term lending, specialized, and investment institutions.
Banks are further classified into public and private sector banks, cooperative banks, and
regional rural banks.

The Indian financial sector today is significantly different from what it used to be in the 1970s
and 1980s. The financial sector prior to the 1990s was characterized by segmented and
underdeveloped financial markets coupled with paucity of instruments. For maintaining spreads
of banking sector, regulation of both deposit and lending rates resulted not only in distorting the
interest rate mechanism, but also adversely affected the viability and profitability of banks.

Without a sound and effective banking system in India it cannot have a healthy economy. The
banking system of India should not only be hassle free but it should be able to meet new
challenges posed by the technology and any other external and internal factors.

For the past three decades, India's banking system has several outstanding achievements to its
credit. The most striking is its extensive reach. It is no longer confined to only metropolitans or
cosmopolitans in India. In fact, Indian banking system has reached even to the remote corners
of the country. This is one of the main reasons of India's growth
India’s banking industry is considered to be very stable with healthy balance sheets and low
exposure to risky assets. The global financial crisis did not affect the Indian banks
significantly.

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Nearly 40% of the population does not have a bank account and only 15% have borrowed
from banks. Even after sustained growth since the nineties, the share of consumer credit
remains very low in total bank loans.

The banking sector in India has a relatively high proportion of women CEO’s. The chief
executives of leading domestic lenders ICICI Bank and Axis Bank, besides the country heads
of HSBC, JP Morgan, UBS, and RBS are all women. Until recently, two among the Reserve
Bank of India’s four deputy governors were also women.

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COMPANY PROFILE

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AXIS BANK

Axis Bank is a private bank recognised in 1994 when the Government of India make permission to have a
private banks in a country. Axis Bank was previously known as UTI Bank started by the Administrator of
the Specified Undertaking of the Unit Trust of India,Life Insurance Corporation of India (LIC), General
Insurance Corporation Ltd., National Insurance Company Ltd., The New India Assurance Company, The
Oriental Insurance Corporation and United India Insurance Company UTI-I. Axis Bank has grown very
rapidly and take its total income to Rs 13,745.04 crore and a net profit of Rs. 1,812.93 crore. Mr. Adarsh
Kishore is the chairman of the Axis Bank and after Mr.P.J.Nayak ,Shikha Sharma become the managing
director and CEO of the bank. Axis Bank is the first to render a secure debit card payment
service.Excellent ATM services are providing by the Axis Bank and is one of the huge ATM network in
India.

Axis Bank is one of thr india's most advanced banks when it comes to technology. Following are the 24
hours and weekly services rendered by the Axis bank for the benefit of the customers:

INTERNET BANKING

CORPORATE ACCOUNTS

LOANS

INSURANCE

OTHER SEERVICES

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ICICI BANK

ICICI Bank was originally promoted in 1994 by ICICI Limited, an Indian financial institution, and was its
wholly-owned subsidiary. ICICI's shareholding in ICICI Bank was reduced to 46% through a public
offering of shares in India in fiscal 1998, an equity offering in the form of ADRs listed on the NYSE in
fiscal 2000, ICICI Bank's acquisition of Bank of Madura Limited in an all-stock amalgamation in fiscal
2001, and secondary market sales by ICICI to institutional investors in fiscal 2001 and fiscal 2002. ICICI
was formed in 1955 at the initiative of the World Bank, the Government of India and representatives of
Indian industry.

In the 1990s, ICICI transformed its business from a development financial institution offering only
project finance to a diversified financial services group offering a wide variety of products and services,
both directly and through a number of subsidiaries and affiliates like ICICI Bank. In 1999, ICICI become
the first Indian company and the first bank or financial institution from non-Japan Asia to be listed on the
NYSE.

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In October 2001, the Boards of Directors of ICICI and ICICI Bank approved the merger of ICICI and two
of its wholly-owned retail finance subsidiaries, ICICI Personal Financial Services Limited and ICICI
Capital Services Limited, with ICICI Bank. The merger was approved by shareholders of ICICI and
ICICI Bank in January 2002, by the High Court of Gujarat at Ahmedabad in March 2002, and by the High
Court of Judicature at Mumbai and the Reserve Bank of India in April 2002. Consequent to the merger,
the ICICI group's financing and banking operations, both wholesale and retail, have been integrated in a
single entity.

ICICI Bank has increased deposit rates on select maturities. The bank has raised the interest rate on
deposits maturing in 270 days to less than one year by 25 basis points to 5.75 per cent for deposits of Rs
15 lakh to Rs 1 crore. ICICI Bank increased its deposit rates in select tenures by up to 0.50% with instant
effect, signaling hardening of interest rates in the industry.

ICICI Bank has announced the appointment of Mr Rajiv Sabharwal as as whole-time director of the bank.
The bank said Mr Sabharwal is designated as an Executive Director effective June 24. Mr Sabharwal was
heading the bank's retail banking operations. ICICI Bank announced the appointment of Mr Rajiv
Sabharwal as awhole-time director of the bank.

ICICI Bank has received the World Finance Awards 2010 in three categories. The three categories are
Excellence in NRI services Worldwide, Excellence in Remittance Business-Worldwide and Excellence in
Private Banking Business-Asia-Pacific Region awards at the prestigious World Finance Awards, UK,
2010.

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HDFC BANK

HDFC Bank Limited is an Indian financial services company based in Mumbai, Maharashtra that was
incorporated in August 1994. HDFC Bank is the fifth or sixth largest bank in India by assets and the
second largest bank by market capitalization as of February 24, 2012. The bank was promoted by the
Housing Development Finance Corporation, a premier housing finance company (set up in 1977) of India.
As on October 2012, HDFC Bank has 2,544 branches and over 10,000 ATMs, in 1,399 cities in India, and
all branches of the bank are linked on an online real-time basis. As of 30 September 2008 the bank had
total assets of Rs.1006.82 billion.[3] For the fiscal year 2010-11, the bank has reported net profit of
3,926.30 crore (US$714.59 million), up 33.1% from the previous fiscal. Total annual earnings of the bank
increased by 20.37% reaching at 24,263.4 crore (US$4.42 billion) in 2010-11.[4] HDFC Bank is one of
the Big Four banks of India, along with: State Bank of India, ICICI Bank and Punjab National Bank.

HDFC Bank was incorporated in 1994 by Housing Development Finance Corporation Limited (HDFC),
India's largest housing finance company. It was among the first companies to receive an 'in principle'
approval from the Reserve Bank of India (RBI) to set up a bank in the private sector. The Bank started
operations as a scheduled commercial bank in January 1995 under the RBI's liberalisation policies.

25
HDFC Bank deals with three key business segments. - Wholesale Banking Services, Retail Banking
Services, Treasury. It has entered the banking consortia of over 50 corporates for providing working
capital finance, trade services, corporate finance, and merchant banking. It is also providing sophisticated
product structures in areas of foreign exchange and derivatives, money markets and debt trading And
Equity research.

Amalgamations
In 2002, HDFC Bank witnessed its merger with Times Bank Limited (a private sector bank promoted by
Bennett, Coleman & Co. / Times Group). With this, HDFC and Times became the first two private banks
in the New Generation Private Sector Banks to have gone through a merger. In 2008, RBI approved the
amalgamation of Centurion Bank of Punjab with HDFC Bank. With this, the Deposits of the merged
entity became Rs. 1,22,000 crore, while the Advances were Rs. 89,000 crore and Balance Sheet size was
Rs. 1,63,000 crore.

26
STATE BANK OF INDIA

State Bank of India (SBI) is a multinational banking and financial services company based in
India. It is a government-owned corporation with its headquarters in Mumbai, Maharashtra. As
of December 2013, it had assets of US$388 billion and 16,000 branches, including 190 foreign
offices, making it the largest banking and financial services company in India by assets.

State Bank of India is one of the Big Four banks of India, along with ICICI Bank, Punjab
National Bank and Bank of Baroda.

The bank traces its ancestry to British India, through the Imperial Bank of India, to the founding
in 1806 of the Bank of Calcutta, making it the oldest commercial bank in the Indian
Subcontinent. Bank of Madras merged into the other two presidency banks—Bank of Calcutta
and Bank of Bombay—to form the Imperial Bank of India, which in turn became the State Bank
of India. Government of India nationalised the Imperial Bank of India in 1955, with Reserve
Bank of India taking a 60% stake, and renamed it the State Bank of India. In 2008, the
government took over the stake held by the Reserve Bank of India.SBI is a regional banking
behemoth and has 20% market share in deposits and loans among Indian commercial banks.

History

The roots of the State Bank of India lie in the first decade of 19th century, when the Bank of

Calcutta, later renamed the Bank of Bengal, was established on 2 June 1806. The Bank of
Bengal was one of three Presidency banks, the other two being the Bank of Bombay

(incorporated on 15 April 1840) and the Bank of Madras (incorporated on 1 July 1843). All

three Presidency banks were incorporated as joint stock companies and were the result of the
27
royal charters. These three banks received the exclusive right to issue paper currency till 1861
when with the Paper Currency Act, the right was taken over by the Government of India. The
Presidency banks amalgamated on 27 January 1921, and the re-organised banking entity took as
its name Imperial Bank of India. The Imperial Bank of India remained a joint stock company
but without Government participation.

Pursuant to the provisions of the State Bank of India Act of 1955, the Reserve Bank of India,
which is India's central bank, acquired a controlling interest in the Imperial Bank of India. On 1
July 1955, the Imperial Bank of India became the State Bank of India. The government of India
recently acquired the Reserve Bank of India's stake in SBI so as to remove any conflict of
interest because the RBI is the country's banking regulatory authority.

In 1959, the government passed the State Bank of India (Subsidiary Banks) Act, which made
eight state banks associates of SBI. A process of consolidation began on 13 September 2008,
when the State Bank of Saurashtra merged with SBI.

SBI has acquired local banks in rescues. The first was the Bank of Behar (est. 1911), which SBI
acquired in 1969, together with its 28 branches. The next year SBI acquired National Bank of
Lahore (est. 1942), which had 24 branches. Five years later, in 1975, SBI acquired Krishnaram
Baldeo Bank, which had been established in 1916 in Gwalior State, under the patronage of
Maharaja Madho Rao Scindia. The bank had been the Dukan Pichadi, a small moneylender,
owned by the Maharaja. The new banks first manager was Jall N. Broacha, a Parsi. In 1985, SBI
acquired the Bank of Cochin in Kerala, which had 120 branches. SBI was the acquirer as its
affiliate, the State Bank of Travancore, already had an extensive network in Kerala.

The State Bank of India and all its associate banks are identified by the same blue keyhole logo.
The State Bank of India wordmark usually has one standard typeface, but also utilises other
typefaces.

28
Punjab National Bank

Punjab National Bank (PNB) is an Indian financial services company based in New Delhi,
India. PNB is the third largest bank in India in terms of asset size. It was founded in 1895 as a
private banking company by Lala Lajpat Rai and is currently the second largest state-owned
commercial bank in India ahead of Bank of Baroda with about 5,000 branches across 764 cities.
It serves over 37 million customers. The bank has been ranked 248th biggest bank in the world
by the Bankers' Almanac. The bank's total assets for financial year 2013 was about US$6.6
billion. Punjab National Bank is one of the Big Four banks of India, along with State Bank of
India, ICICI Bank and Bank of Baroda. PNB has a banking subsidiary in the UK, as well as
branches in Hong Kong, Dubai and Kabul, and representative offices in Almaty, Dubai, Oslo,
and Shanghai.

History

Punjab National Bank was registered on 19 May 1894 under the Indian Companies Act , with its
office in Anarkali Bazaar, Lahore. The founding board was drawn from different parts of India
professing different faiths and a varied back-ground with, however, the common objective of
providing country with a truly national bank which would further the economic interest of the
country. PNB's founders included several leaders of the Swadeshi movement such as Dyal Singh
Majithia and Lala Harkishan Lal, Lala Lalchand, Shri Kali Prosanna Roy, Shri E.C. Jessawala,
Shri Prabhu Dayal, Bakshi Jaishi Ram, and Lala Dholan Dass. Lala Lajpat Rai was actively
associated with the management of the Bank in its early years. The board first met on 23 May
1894. Ironically, the PNB Website now claims Lala Lajpat Rai to be the founding father,
surpassing Rai Mul Raj and Dyal Singh Majithia. The bank opened for business on 12 April
1895 in Lahore. PNB has the distinction of being the first Indian bank to have been started solely

29
with Indian capital that has survived to the present. (The first entirely Indian bank, Commercial
Bank, was established in 1881 in Faizabad, but failed in 1958.)

PNB has had the privilege of maintaining accounts of national leaders such as Mahatma Gandhi,
Shri Jawahar Lal Nehru, Shri Lal Bahadur Shastri, Shrimati Indira Gandhi, as well as the account
of the famous Jalianwala Bagh Committee.

30
LITERATURE REVIEW

31
LITERATURE REVIEW

Adaeze (2007) This study is on the effects of performance appraisal on productivity in an


organization and it is geared towards examining the effects of performance appraisal on the
productivity of employees in organization. The researcher made use of survey design. Inview of
the findings, it was discovered that participation of employees in appraisal exercise and the use
of performance appraisal resulted to an increase in output to the organization and higher standard
of living to the employee because of promotion given and other necessary reward that motivated
the employee to work hard. The researcher concludes that problem with the organization’s
appraisal system lies with implementation rather than method. Consequently, since the intention
of the research is not to recommend an entirely new method but to enhance the relationship
between the currently used method. A Study of Performance Appraisal Practices as a Tool to
Improve Employee Efficiencies in Private Sector Banks and its objectives, the researcher
conclusion is there summed up in the phrase. Better implementation of the organization’s
appraisal method is needed so as to be able to match practice with purpose on an intensive advice
that the organization should provide an intensive training programme for appraisal. The
conclusion draws on the major highlight of the study of the revelation that subordinates are not
involved in setting goals and objectives on which they are appraisal.

Arvind (2009) evaluated the PerformanceAppraisal Systems of 33 diverse organizations. The


study observed that subjectivity and appraiser bias were most common apprehensions in
evaluating performance appraisal system in the organization. Strong needs were felt for
identifying measurable parameters for performance evaluation, and providing multiple feedbacks
to trim down appraiser bias. Further, objectivity and measurable performance were found to be
most desirable areas to help improve performance appraisal system

Sharma Neeraja And Aman (2009)- examined the Employers Perspectives Regarding
Performance Appraisal and Reward Philosophy in Insurance Sector in Haryana. They study the
employer’s perspectives regarding performance appraisal and reward philosophy and the effect
of demographic variables on it. The sample is selected on the basis of convenient sampling
method. This study is based on the hypothesis that demographic variables and employers
opinions are independent of each other.

Diane Shaffer(2009) has written in his article writer has discussed that motivation and
performance appraisal are interrelated. Motivation is dependent on performance management.
Employees who are motivated and happy with their jobs want to stay connected with the
company for a long time. Many organizations have not implemented correct performance
appraisal system to evaluate the performance of employees. Author has discussed here that they
hould implement a successful appraisal method/system and also give reward to employees who
perform good in the organization. Through this practice employee become motivated towards

32
their jobs and improve their performance and performance of organization as a whole will also
improve.

Rathnaweerage (2010) This study attempted to examine the impact of Human Resource
Management practices on Human Resource Management outcomes in Sri Lankan public sector
banks. The results of this study revealed that bundles of HRM practices are positively related to
better employee satisfaction. Findings of this study show that providing training for employees is
positively related to higher employee satisfaction, employee commitment and higher employee
retention.

Bhatia (2011) The study focuses on the need for such employees and how their presence can
improve the progress and work efficiency of the organization as a whole. Also focuses on the
challenges faced by the HR managers to improve employee engagement for an organization’s
survival. It also throws light on other aspects of employee engagement like benefits, key
indicators and factors influencing employee engagement. It also focuses on the various practices
used in private banks.

Sharma and Cheema (2011) Performance Appraisal has been considered as the most significant
an indispensable tool for an organization, for an organization, for the information it provides is
highly useful in making decisions regarding various personnel aspects such as promotion and
merit increases. Performance measures also link information gathering and decision making
processes which provide a basis for judging the effectiveness of personnel sub-divisions such as
recruiting, selection, training and compensation. This research isconcentrate on examine the
effect of the performance appraisal on an individual as well as on the organizations. The sample
size of 100 has been chosen from the north Indian states. The data used for the study is primary
data collected through the help of questionnaire filled by the samples. The data was evaluated
with the help of statistical tools i.e., descriptive statistics, regression, correlation, residual
analysis and chi square test. The findings of the research show that there is a noticeable effect of
the performance appraisal on the organization as well as on the Individual.

Sharma and Mehlawat (2011) The conclusion of this study is that those banks which have
promoted the Human Resource Management Strategies and Business Strategies in the field of
Promotion, Training, Reward System, Productivity, Job Security and Placement are performing
better in the present time. The banks such as Punjab National Bank and HDFC Bank have also
improved their performance. The bank such as Bank of Rajasthan Ltd. has not adopted any HR
and Business strategies properly so the performance of this bank in not in better condition. The
result is that the impact of Business and HR strategies is much more on the bank's performance.

Toppo & Prusty (2012) This study has focused to study the evolution of employee’s
performance appraisal system, critics the system suffered and how the performance management
system came to the practice. The main purpose of this study is to differentiate these two systems,

33
employee’s performance appraisal and management system. The study identified as
advancement in the management field and growing complexity in corporate sectors demand
more capable HR, so mare appraisal of employee’s performance is not sufficient. Employee’s
contribution should be aligned with organizational objectives and strategy. Performance
management eliminates the shortcomings of performance appraisal system to the some extent.

Sarker (2012) Private commercial banking in Bangladesh is booming in recent times with
higher number of potential customer from the local market. But this sector is facing challenge in
achieving management efficiency one of which leads to experience high level of competition. In
order to achieve sustainable growth in this competitive market and to achieve higher
organizational performance, special emphasis should be given to improve HRM practices. The
relationships among HRM practices, Job satisfaction and firm performance have been an
integrated issue for business and operational environment. HRM practices are also considered as
major contributory factor for higher organizational performance through higher job satisfaction.
Since, the HRM practices are mostly responsible for the achievements of business strategy and
success; this study has given particular attention to the need of importance of HRM practices.

Bhatia and Jain (2012) The success of an organization will therefore depend on its ability to
measure accurately the performance of its members and use its objectivity to optimize them as a
vital resource. The performance appraisal plays a very important role in success of any
organization. It not only motivates the employee but also improves the productivity level of any
organization. Though the need of Performance appraisal is generated in every organization but
there is a difference in mechanism in public and private sector. This research paper is an attempt
to highlight various dimensions of appraisal in both the sectors, do comparative analysis and
suggest some corrective measures for betterment.

Shrivastava and Rai (2012) Banking sector is a fast growing sector of India. With swift
expansion in the number of branches and the newfunctions assigned to them, banks are
beginning to feel a new pressure on their organizational abilities. The processes ofrecruitment,
placement, training, promotion and appraisal, in orderto ensure that the right numbers of staff
with the right capacities areavailable at the right time and for the right places. Appraisal is one of
the key factors of organizational ability which is also the focus of this study. In simple words we
can say that performance appraisal is an analysis of employee’s recent successes and failures,
personal strengths and weaknesses, and suitability for promotion or further training.

Uma Rani (2012) Change is continuous process in all sectors of the world. Another significant
impact of banks today is the technology issue. In this study the business banking products of
HDFC bank, that best suits the needs of the borrower were analysed. The customer feels that
loans to be obtained require a process that is extremely complicating and time consuming. This
calls for an ombudsman setup separately for the domain. The observation and findings of the
study have helped to give useful recommendations to bank. The implementation of the
34
suggestion can help to improve strategies and build competencies over that of their competitors.
This study has there by helped the researcher by giving exposure into new concepts in today’s
banking scenario as the interface shifts from service to products.

Shilpi Singh (2013) The study covers all the important areas of human resource development in
banks. These areas include conceptual clarification about human resource and human resource
development in banks, essentials of HRD, the sub-system of human resource development like
performance appraisal, training, management development, career planning and development,
organization development, participative management, quality circles etc. These primary areas of
human resources development will be studied thoroughly to the maximum extent through the
means of discussion, interviews, reports, accounts, observations etc.

Faseehullah khan (2013) In many organizations, reward decisions depend on subjective


performance evaluations. However, evaluating an employee's performance is often difficult. In
this paper, we develop a model in which the employee isuncertain about his own performance
and about the manager's ability to assess him. The manager gives an employee a performance
appraisal with a view of affecting the employee's self-perception, and the employee's perception
of the manager's ability to assess performance. We examine how performance appraisals affect
the employee's future performance. The predictions of model are consistent with various
empirical findings. These comprise the observation that managers tend to give positive
appraisals, the finding that on average positive appraisals motivate more than negative
appraisals, and the observation that the effects of appraisals depend on the employee's perception
of the manager's ability to assess performance accurately.

Bhatt and Tarjani (2013) The business organizations are attaching great importance to human
resource because human resources are the biggest source of competitive advantage and have the
capability of converting all the other resources in to product/service. The effective performance
of this human resource depends on the type of HRD climate that prevails in the organization, if it
is good than the employee’s performance will be high but if it is average or poor then the
performance will be low. The study findsout the type of HRD climate that is prevailing in public
sector banks in Bhavnagar. The researcher hasalso tried to find out the difference in the
perception of employees regarding HRD climate on the basis of age, gender, designation,
qualification. The data were analyzed using several statistical tools such as mean, standard
deviation, percentiles, Z test. The result shown that the HRD climate in public sector banks is
average and the perception of employees regarding the HRD climate do not differs significantly
on the basis of gender, qualification and designation but it differs significantly on the basis of
age.

Chahal (2013) Training and development enables employees to develop skills and competencies
necessary to enhance bottom-line results for their organization. It is a key ingredient in banking
sector for organizational performance improvement. It ensures that randomness is reduced and
35
learning or behavioral change takes place in structured format. Training and Development helps
in increasing the job knowledge and skills of employees at each level and helps to expand the
horizons of human intellect and an overall personality of the employees. This paper analyzes the
status of various need analysis based training and development practices in Punjab National
Bank and HDFC bank and explores the proposed link between the training and employees’
productivity by adopting development based theory. The study makes use of statistical
techniques such as percentage, mean, standard deviation, standard error and coefficient of
variation in analyzing the data for finding the result. The result shown that the Training in PNB
& HDFC is average and there is scope for improvement in training. The perception of employees
regarding the Training and A Study of Performance Appraisal Practices as a Tool to Improve
Employee Efficiencies in Private Sector Banks –Development somewhat differs significantly on
the basis of gender and designation. Consequently the recommendations support for the
noteworthy of needs assessment of training which will bring a constructive worth in banking
sector.

Kour and Gakhar (2013) The liberalization policy has affected the competitiveness of banks
due to the global pressures resulting into combination of Human Resource Management with
business policies. The banks have been facing tough competition from the various financial
institutions such as insurance firms, mutual fund organizations, non-bank financial companies
etc. for a long time since the onset of LPG reforms. Although after the introduction of ‘Jan Dhan
Yojana’, their contribution in the financial inclusion has boosted up, yet the bank employees’
expectations from the industryhave also got an upward lift. This calls for a need to innovate the
earlier HR practices of the banks so that the employee productivity can be enhanced. This paper
provide an insight to such innovations related to Human Resource Management with the help of
a primary study based on the viewpoints of HR managers of eight different Indian banks.

36
OBJECTIVES OF THE STUDY

37
OBJECTIVES OF THE STUDY

 To study the employee’s perception with the performance appraisal system and to address
the specific aspects of performance appraisal.

 To study the fairness of the performance appraisal arisen out from evaluation of
outcomes received

 To analyze the difference in employee’s perception regarding fairness of appraisal system


between both companies

38
RESEARCH METHODOLOGY

39
RESEARCH METHODOLOGY

Research design is a master plan specifying the methods and procedures for collecting and
analyzing the needed information. It is a framework or the blueprint that plans the action for
research project. The objectives of the study determined during the early stages of the research
are included in the design to ensure that the information collected is appropriate for solving the
problem

So following steps followed in research process:

 Problem statement
 Research design
 Sample design
 Data collection
 Analysis and Interpretation of data

PROBLEM STATEMENT

The research problems, in general refers to some difficulty with a researcher experience in the
contest of either a particular a theoretical situation and want to obtain a solution for same. The
present deals with analyzing the employee’s perception of performance appraisals in PRIVATE
SECTOR BANKS (AXIS BANK, HDFC BANK, ICICI BANK) AND PUBLIC SECTOR
BANKS (PNB, SBI)

40
RESEARCH DESIGN

Descriptive
PURPOSE OF THE STUDY

TYPE OF INVESTIGATION Causal

STUDY SETTING Non contrived

TIME HORIZON Cross-Sectional

MEASUREMENT AND SCALING Likert Scale (Interval Scaling)

41
SAMPLE AND SAMPLING DESIGN

Employees working with Bank


TARGET POPULATION
75 employees which comprises 37.5% of
SAMPLE SIZE the total population

SAMPLING TECHNIQUE Non Probability Sampling


SAMPLING AREA Employees of Private Sector Banks
(AXIS BANK, HDFC BANK, ICICI
BANK) And Public Sector Banks (PNB,
SBI)

42
DATA COLLECTION

Data collection is integral part of the research design, though we are dealing it separately. Data
collection is determined by the research technique selected for the project. Data can be collected
in a variety of ways, in different settings – field or lab – and from different sources. It could
include interviews – face to face interviews, telephone interviews, computer-assisted interviews,
and interviews through electronic media; questionnaires that either personally administered, sent
through mail, or electronically administered; observation of individuals and events which could
be participant or non participant.

In the present study researcher has made use of:

PRIMARY SECONDARY
SOURCE SOURCE

43
LIMITATIONS OF THE STUDY

The prime difficulties which researcher has faced in collection of information are discussed
below:

1. Time Constraint: The time period for carrying out the research has been limited as a
result of which many facts have been left unexplored. So if more time had been provided,
the sample size would have been increased. The respondent would have been given more
time to fill the questionnaire.
2. Unwillingness of respondents: While collection of the data many employees were
unwilling to fill the questionnaire. They have taken this as an unproductive activity.
3. Respondents’ bias: Due to the biasness on the part of respondents, data collected may
have been affected which further reduces the credibility of the findings.
4. Limited sample size: The sample size was only 37.5% of the target population due to
which the findings cannot be generalized.
5. Other limitations:
 Employees misinterpret as questionnaire is standardized
 Employees didn’t replied honestly
 Employees didn’t wish to reveal the information as they might think that they will not
benefit from responding perhaps even be penalized by giving their real opinion.
 Questionnaire was lengthy.
 There is no way to tell how truthful a respondent is being
 There is no way of telling how much thought a respondent has put in
 Lacks validity
 Employees didn’t understand the questions.

44
DATA ANALYSIS AND
INTERPRETATION

45
Que1 – PERFORMACE EXPECTATION SET AT THE START OF RATING PERIOD

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 13 17.3%
agree 29 38.7%
neither agree nor disagree 22 29.3%
disagree 9 12.0%
strongly disagree 2 2.7%
total 75 100%

RESPONDENTS (in percentage)


38.7
40.0
29.3
30.0
17.3
20.0 12.0
10.0 2.7 RESPONDENTS (in
percentage)
0.0
strongly agree neither disagree strongly
agree agree disagree
nor
disagree

INTERPRETATION: 38.7% of the total employees agree and 17.3 % strongly agree while
29.3% were neutral and rest 12% employees disagree and 2.7% strongly disagree to the fact.

46
Que 2 - PERFORMANCE EXPECTATION MEASURES WHAT I REALLY DO

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 14 18.7%
Agree 36 48.0%
neither agree nor disagree 12 16.0%
Disagree 13 17.3%
strongly disagree 0 0.0%
Total 75 100%

48.0
50.0
45.0
40.0
35.0
30.0
25.0
18.7 17.3 RESPONDENTS (in
20.0 16.0 percentage)
15.0
10.0
5.0 0.0
0.0
strongly agree neither disagree strongly
agree agree nor disagree
disagree

INTERPRETATION:

48% of the total employees agree and 18.7 % strongly agree while 16% were neutral and rest
17.3% employees disagree to the fact.

47
Que 3 - EXPECTATION REFLECTS IMPORTANT FACTORS OF MY JOB

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 25 33.3%
Agree 20 26.7%
neither agree nor disagree 16 21.3%
Disagree 12 16.0%
strongly disagree 2 2.7%
Total 75 100%

30
25
25
20
20
16
15
12
RESPONDENTS (in
10 number)

5
2

0
strongly agree neither disagree strongly
agree agree nor disagree
disagree

INTERPRETATION:

26.7% of the total employees agree and 33.3 % strongly agree while 21.3% were neutral and rest
16% employees disagree and 2.7% strongly disagree to the fact.

48
Que 4 - HELP TO SET STANDARDS

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 11 14.7%
agree 32 42.7%
neither agree nor disagree 23 30.7%
disagree 7 9.3%
strongly disagree 2 2.7%
total 75 100%

RESPONDENTS (in percentage)


2.7 14.7
strongly agree
9.3
agree

neither agree nor


30.7 disagree
disagree
42.7
strongly disagree

INTERPRETATION:

42.7% of the total employees agree and 14.7 % strongly agree while 30.7% were neutral and rest
9.3% employees disagree and 2.7% strongly disagree to the fact.

49
Que 5 - CONSTANT STANDARDS FOR PLANNING SESSION

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 11 14.7%
Agree 31 41.3%
neither agree nor disagree 20 26.7%
Disagree 10 13.3%
strongly disagree 3 4.0%
Total 75 100%

RESPONDENTS (in number)

40
31
30
20
20
11 10
10 3 RESPONDENTS (in number)

0
strongly agreeagree
neither agree nor disagree
disagree
strongly disagree

INTERPRETATION:

41.3% of the total employees agree and 14.7 % strongly agree while 26.7% were neutral and rest
13.3% employees disagree and 4% strongly disagree to the fact.

50
Que 6 - RATER ASSIGNED IS QUALIFIED TO EVALUATE THE WORK

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 4 5.3%
Agree 29 38.7%
neither agree nor disagree 28 37.3%
Disagree 10 13.3%
strongly disagree 4 5.3%
Total 75 100%

RESPONDENTS (in percentage)


38.7 37.3
40.0
30.0
20.0 13.3
10.0 5.3 5.3

0.0 RESPONDENTS (in


strongly agree neither disagree strongly percentage)
agree agree disagree
nor
disagree

INTERPRETATION:

38.7% of the total employees agree and 5.3 % strongly agree while 37.3% were neutral and rest
13.3% employees disagree and 5.3% strongly disagree to the fact.

51
Que 7 - ASSIGNED RATER KNOWS WHAT I AM SUPPOSED TO DO

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 24 32.0%
Agree 20 26.7%
neither agree nor disagree 17 22.7%
Disagree 11 14.7%
strongly disagree 3 4.05%
Total 75 100%

RESPONDENTS (in number)

24
strongly agree
Agree
20
75 neither agree nor disagree
Disagree
17 strongly disagree

3 11

INTERPRETATION:

26.7% of the total employees agree and 32 % strongly agree while 22.7% were neutral and rest
14.7% employees disagree and 4% strongly disagree to the fact.

52
Que 8 - RATER IS FAMILIAR WITH RATING PROCEDURES AND FORMAT

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 12 16.0%
Agree 26 34.7%
neither agree nor disagree 26 34.7%
Disagree 6 8.0%
strongly disagree 5 6.7%
Total 75 100%

RESPONDENTS (in percentage)

7%
16%
8%

strongly agree
agree
neither agree nor disagree
disagree
35% strongly disagree
34%

INTERPRETATION:

34.7% of the total employees agree and 16 % strongly agree while 34.7% were neutral and rest
8% employees disagree and 6.7% strongly disagree to the fact.

53
Que 9 - RATER KNOWS HOW TO EVALUATE MY WORK

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 12 16.0%
agree 32 42.7%
neither agree nor disagree 22 29.3%
disagree 8 10.7%
strongly disagree 1 1.3%
total 75 100%

RESPONDENTS (in percentage)

1%
11% 16%

strongly agree
agree
neither agree nor disagree
29%
disagree
strongly disagree

43%

INTERPRETATION:

42.7% of the total employees agree and 16 % strongly agree while 29.3% were neutral and rest
10.7% employees disagree and 1.3% strongly disagree to the fact.

54
ACCURACY OF RATING

Que 10 - PERFORMANCE BASED ON QUALITY OF WORK

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 7 9.3%
agree 18 24.0%
neither agree nor disagree 36 48.0%
disagree 11 14.7%
strongly disagree 3 4.0%
total 75 100%

80 75
70
60
50
40 36

30 RESPONDENTS (in number)


18
20
11
10 7
3
0
strongly agree neither disagree strongly total
agree agree nor disagree
disagree

INTERPRETATION:

24% of the total employees agree and 9.3 % strongly agree while 48% were neutral and rest
14.7% employees disagree and 4% strongly disagree to the fact.

55
Que 11 - RATING REFLECTS AMOUNT OF WORK DONE

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 15 20.0%
agree 29 38.7%
neither agree nor disagree 21 28.0%
disagree 7 9.3%
strongly disagree 3 4.0%
total 75 100%

RESPONDENTS (in percentage)

4%
9% 20%

strongly agree
agree
neither agree nor disagree
28%
disagree
strongly disagree

39%

INTERPRETATION:

38.7% of the total employees agree and 20% strongly agree while 28% were neutral and rest
9.3% employees disagree and 4% strongly disagree to the fact.

56
12 - RATINGS BASED ON THING THAT HELP AT WORK

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 12 16.0%
Agree 25 33.3%
neither agree nor disagree 27 36.0%
Disagree 8 10.7%
strongly disagree 3 4.0%
Total 75 100%

RESPONDENTS (in percentage)


40.0
36.0
35.0 33.3

30.0

25.0

20.0
16.0
15.0 RESPONDENTS (in percentage)
10.7
10.0
4.0
5.0

0.0
strongly agree neither disagree strongly
agree agree nor disagree
disagree

INTERPRETATION:

33.3% of the total employees agree and 16 % strongly agree while 36% were neutral and rest
10.7% employees disagree and 4% strongly disagree to the fact.

57
Que 13 - RECENT RATINGS BASED ON EFFORTS

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 10 13.3%
Agree 31 41.3%
neither agree nor disagree 21 28.0%
Disagree 10 13.3%
strongly disagree 3 4.0%
Total 75 100%

35
30
25
20
15 31
RESPONDENTS (in number)
10 21

5 10 10
3
0
strongly Agree neither Disagree strongly
agree agree nor disagree
disagree

INTERPRETATION:

41.3% of the total employees agree and 13.3 % strongly agree while 28% were neutral and rest
13.3% employees disagree and 4% strongly disagree to the fact.

58
Que 14 - RECENT RATING BASED ON RESPONSIBILITY

RESPONDENTS (in RESPONDENTS (in


RESPONSES number) percentage)
strongly agree 4 5.3%
Agree 28 37.3%
neither agree nor disagree 29 38.7%
Disagree 12 16.0%
strongly disagree 2 2.7%
Total 75 100%

45.0

40.0

35.0

30.0

25.0

20.0 37.3
38.7 RESPONDENTS (in percentage)
15.0

10.0
16.0
5.3
5.0
2.7
0.0
strongly agree neither disagree strongly
agree agree nor disagree
disagree

INTERPRETATION:

37.3% of the total employees agree and 5.3 % strongly agree while 38.7% were neutral and rest
16% employees disagree and 2.7% strongly disagree to the fact.

59
FINDINGS, SUGGESTIONS AND
CONCLUSION

60
FINDINGS

 38.7% of the total employees agree and 17.3 % strongly agree while 29.3% were neutral
and rest 12% employees disagree and 2.7% strongly disagree to the fact.
 48% of the total employees agree and 18.7 % strongly agree while 16% were neutral and
rest 17.3% employees disagree to the fact.
 26.7% of the total employees agree and 33.3 % strongly agree while 21.3% were neutral
and rest 16% employees disagree and 2.7% strongly disagree to the fact.
 42.7% of the total employees agree and 14.7 % strongly agree while 30.7% were neutral
and rest 9.3% employees disagree and 2.7% strongly disagree to the fact.
 41.3% of the total employees agree and 14.7 % strongly agree while 26.7% were neutral
and rest 13.3% employees disagree and 4% strongly disagree to the fact.
 38.7% of the total employees agree and 5.3 % strongly agree while 37.3% were neutral
and rest 13.3% employees disagree and 5.3% strongly disagree to the fact.
 26.7% of the total employees agree and 32 % strongly agree while 22.7% were neutral
and rest 14.7% employees disagree and 4% strongly disagree to the fact.
 34.7% of the total employees agree and 16 % strongly agree while 34.7% were neutral
and rest 8% employees disagree and 6.7% strongly disagree to the fact.
 42.7% of the total employees agree and 16 % strongly agree while 29.3% were neutral
and rest 10.7% employees disagree and 1.3% strongly disagree to the fact.
 24% of the total employees agree and 9.3 % strongly agree while 48% were neutral and
rest 14.7% employees disagree and 4% strongly disagree to the fact.
 38.7% of the total employees agree and 20% strongly agree while 28% were neutral and
rest 9.3% employees disagree and 4% strongly disagree to the fact.
 33.3% of the total employees agree and 16 % strongly agree while 36% were neutral and
rest 10.7% employees disagree and 4% strongly disagree to the fact.
 41.3% of the total employees agree and 13.3 % strongly agree while 28% were neutral
and rest 13.3% employees disagree and 4% strongly disagree to the fact.
 37.3% of the total employees agree and 5.3 % strongly agree while 38.7% were neutral
and rest 16% employees disagree and 2.7% strongly disagree to the fact.

61
SUGGESTIONS

After completing the analysis and interpretation the researcher has suggested following
recommendations to the employer so that they would be able to design such PMS which
will improve the employee perception

 Proper induction programmed should be there so that the employees should be aware
about the method of performance appraisal.

 The employees should be motivated by giving more of rewards with a mix of individual
and group award.

 There should be open communication between the subordinates & superiors.

 The employees should be given more of group assignments.

 There should be transparency in appraising the performance of the employees.

 The employees should be given knowledge regarding the methods of PMS.

 The employees should be given the knowledge regarding the various rating scales.

62
CONCLUSION

The policy implications can be recommended once the questionnaire is filled and the researcher
is through with the report.

 Company should introduce the concept of Management by Objective (MBO) while doing
performance planning so that the personal goals of the employees can be in alignment
with the organizational goals.

 The company should try to increase the clarity of the jobs assigned so that the employees
can perform better.

 Company should try to give more of team assignments and they should be given group
rewards rather than individual rewards so that employees can work better in team.

 Company should try to provide open communication between the superiors and
subordinates so that the expectations from the superiors to the subordinate are clear.

 There should be clear linkage between performance appraisal program & employee’s
perception

 Employer should set clear expectations and PPR system should measure the work
actually done by employees

 Organizations should provide different ways to appeal biased or inaccurate ratings

 Rater should give clear and real examples to justify his or her ratings

63
BIBLIOGRAPHY

BOOKS:

 Chhabra T.N. (Fifth Revised Edition),”Human Resource Management, concepts


and issues”, Educational and Technical Publishers, New Delhi
 Ashwathappa K.(Fifth Edition),”Human Resource Management”, Tata Mc Graw-
Hill publishing Company, New Delhi
 Rao P. Subba(Third Revised Edition),”Human Resource Management and
Industrial Relations”, Himalaya publishing House, Mumbai
 Gary Dessler(Eighth Edition),”Human Resource Management” Pearson
Education Private Limited, Singapore
 Gupta S.C. and Kapoor V.K.(Third thoroughly Revised Edition),”Fundamentals
Of Mathematical Statistics”, Sultan Chand and Sons Educational Publishers
 Cooper Donald R. and S. Schinder Pamela(Second Edition),”Marketing Research,
concepts and cases”, Tata Mc Graw- Hill publishing Company, New delhi
 Kothari C.R.(Second Revised Edition),”Research Methodology- Methods and
Techniques”, New Age International Publishers, New Delhi
 Jain T.R. and Dr. Aggarwal S.C.(2009-2010 Edition),”Statistics For MBA”, V.K.
(India) Enterprises, New Delhi
 Sekaran Uma(Fourth Edition),”Research Methods for Business- A Skill Building
Approach”, John Wiley and Sons Limited, United Kingdom, 105-108
 Decenzo David A., Robbins Stephen P. (5th Edition), “Personnel Human
Resource

JOURNALS:

 Selden Sally and Sowa E. Jessica(2011),”Performance Management and Appraisal in


Human Service Organizations: Management and Staff Perspectives”,Public Personnel
Management,

64
 Purang P. and Shrivastava A.(January 2011),”Employee Perception of Performance
Appraisal: A Comparative Study On Indian Banks”,The International Journal Of Human
Resource Management

WEBSITES:

 http://shodhganga.inflibnet.ac.in/bitstream/10603/3705/13/13chapter%203
 https://www.slideshare.net/sonnyhughes74/literature-review-on-performance-
appraisal-44056640
 http://shodhganga.inflibnet.ac.in/bitstream/10603/60862/11/11_chapter%201
 https://gradeup.co/history-of-banking-in-india-i-e02deb86-f4ac-11e5-b410-2f0cca4d3c07

65
ANNEXURE

66
Que 1 - The PPR process requires that performance expectation be set for me during a
Planning Session at the start of a rating period

Ans -

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

Que 2 - My performance standards set for me during the Planning Session will remain the
same until my rater and I change them

Ans -

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

Que 3 - My organization ensures that I am assigned a rater who understands the


requirements and difficulties of my work

Ans –

1- strongly agree

2- agree

3- neither agree nor disagree


67
4 -disagree

5 - strongly disagree

Que 4 - My performance is based on how well I do my work

Ans –

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

Que 5 - My performance rating is based on the many things I do that help at work

Ans –

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

Que 6 - The most recent performance rating I received is based on the many things I am
responsible for at work

Ans –

1- strongly agree

68
2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

Que 7-My rater clearly explains to me what he or she expects from my performance

Ans –

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

Que 8 - My rater gives me a chance to question how I should meet my performance


expectations

Ans -

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

69
Que 9- My rater frequently let me know how I am doing

Ans - 1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

Que 9 - My rater routinely gives me feedback that is important to the things I do at work

Ans –

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

Que 10 - I can challenge a performance rating if I think it is unfair

Ans -

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree
Que 11 - My performance rating can be changed if I can show that it is incorrect or unfair
70
Ans –

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

Que 12 - I am satisfied with performance rating I received for the most recent rating period

Ans –

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

Que 13 - My most recent performance rating reflected how I did on the job

Ans -

1- strongly agree

2- agree

3- neither agree nor disagree

4 -disagree

5 - strongly disagree

71