Analysis of Performance Appraisal and Employee Motivation

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 ABSTRACT
Performance appraisal is one of the main functions of human resource management. It is useful not only for
Management but also for the employees so that they can know and understand about their performance from
the Management Point of view. In this Paper researcher has tried to assess the relationship of Performance
Appraisal system on the Motivation of Employees. For this purpose an empirical study has been carried out
among the staff members of Cooperative Bank and data was collected through questionnaire. During the
research it has been observed that the establishment of relationship between Performance Appraisal and
Work Motivation depends on the type of performance appraisal system used in the particular sector and the
transparency with which the whole process of Performance Appraisal was carried out. In the Cooperative
bank where the survey was carried out are in practice of writing confidential report of employees and the
data analyzed gives very no significant relationship between performance Appraisal and Work Motivation.

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 ACKNOWLEDGEMENTS
We would like to express our special thanks of gratitude to our teacher as well as our principal who gave us
the golden opportunity to do this wonderful project on the topic performance appraisal and work motivation,
which also helped us in doing a lot of Research and we came to know about so many new things. We are
really thankful to them.

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 TABLE OF CONTENTS

ABSTRACT ------------------------------------------------------------------------------------------------------- 2
ACKNOWLEDGEMENT --------------------------------------------------------------------------------------- 3
CHAPTER 01: INTRODUCTION
1.1 Introduction ---------------------------------------------------------------------------------------------------- 5
1.2 Statement of the Problem ------------------------------------------------------------------------------------ 5
1.3 Performance Appraisal --------------------------------------------------------------------------------------- 6
1.4 Objectives ------------------------------------------------------------------------------------------------------ 6
1.5 Objective of Report ------------------------------------------------------------------------------------------- 6
1.6 Purpose of Performance Appraisal ------------------------------------------------------------------------- 6
CHAPTER 02: LITERATURE REVIEW
2.1 Objective of the Study ---------------------------------------------------------------------------------------- 7
2.2 Significance of the Study ------------------------------------------------------------------------------------- 7
2.3 Literature Review ---------------------------------------------------------------------------------------------- 7
2.4 The Concept of Performance Appraisal --------------------------------------------------------------------- 7
2.5 Fairness of Performance Appraisal -------------------------------------------------------------------------- 8
2.6 Performance Appraisal Feedback ---------------------------------------------------------------------------- 8
2.7 Uses of Performance Appraisal Results --------------------------------------------------------------------- 8
2.8 Performance Appraisal and Employee Motivation -------------------------------------------------------- 9
2.9 Intrinsic and Extrinsic Motivation --------------------------------------------------------------------------- 10
2.10 Herzberg’s Hygiene Theory of Motivation --------------------------------------------------------------- 10
2.11 Role of Performance Appraisal in Enhancing Employee Motivation --------------------------------- 10
2.12 Conceptual Framework -------------------------------------------------------------------------------------- 11
2.13 Hypothesis ----------------------------------------------------------------------------------------------------- 12
CHAPTER 03: RESEARCH METHODOLOGY
3.1 Chapter Introduction ------------------------------------------------------------------------------------------- 13
3.2 Research Approach -------------------------------------------------------------------------------------------- 13
3.3 Research Strategy ----------------------------------------------------------------------------------------------13
3.4 Time Horizon --------------------------------------------------------------------------------------------------- 13
3.5 Technique of Data Collection and Data Analysis --------------------------------------------------------- 13
3.6 Ethical Considerations ---------------------------------------------------------------------------------------- 14
3.7 Chapter Summary --------------------------------------------------------------------------------------------- 14
CHAPTER 04: DATA ANALYSIS
4.1 Tables and Bar Chart ------------------------------------------------------------------------------------------ 15
CHAPTER 05: REPORT CONCLUSION
5.1 Conclusion ------------------------------------------------------------------------------------------------------ 36

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 Chapter 01 INTRODUCTION

1.1 Introduction
Human resource is vital for any organization it is one of the useful resources. If human resource or
employees of any organization will be happy, they will do their best in organization and vice versa. So it is
important to manage the human resource. Organization tries to satisfy and motivate employee to do their
best by various means and the performance Appraisal is one of those.
Employees of the Organization work better when they get appraisal on their performance. They get
motivated and when their performance evaluated and rewarded suitably by any organization.
The performance appraisal is the process of obtaining, analyzing and recording information about the
relative worthy 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. Its aim to measure what
an employee does.
Performance appraisal is regular reviews of employee performance within organization. Generally, the aim
of a performance appraisal is too:
Give feedback on performance to employees.
 Identify employee training needs.
 Documents criteria used to allocate organizational rewards.
 Form a basis for personal decisions: salary increase, promotion, disciplinary action etc.
 Provide the opportunity for organizational diagnosis and development.
 Facilitate communication between employee and administration.

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 toes to the heart of personnel management and
reflects the management’s interest in the progress of the employees.
People differ in their abilities and their aptitudes. There is always some difference between the quality and
quantity of the same work on the same job being done by two different people. Therefore, performance
management and performance appraisal is necessary to understand each employee’s abilities, competencies
and relative merit and worthy to the organization.
Performance appraisal rates the employees in term of their performance. Performance appraisal takes into
account the past performance of the employees and focuses on the improvement of the future performance
of the employees. The study of performance appraisal of employees was carried out at “BANKING
SECTOR”. The main aim of the study was to explore the method which is followed and effectiveness of the
employees. The primary data required for the study were collected through structured questionnaire,
personal interview and informal talks. The second data was from the company manuals and the website of
the Company. The data were analyzed and the finding was arrived at the basis of which suggestions are
made.

1.2 STATEMENT OF THE PROBLEM

Today working climate demands a great deal of communication and effort from employees’. Who in turn
naturally expect a great deal more from their employers’ Performance appraisal is designed to maximize
effectiveness by bringing participation to a more individual level in that it provides a forum for consultation
about standard of work, potential, aspiration and concerns. It is an opportunity for employee to have
significantly greater influence upon the quality of their working lives. In these times of emphasis on quality,
there is a natural equation: better quality goods and services from employees who enjoy better quality
“goods and services: from their employers’.
In most cases, workers in some manufacturing companies do not receive adequate bonus and incentive
which could contribute immensely to inactive performance in their job or work. However, the problems in
question can be highlighted viz:
Low productivity and profitability in a manufacturing company.
The production of inferior goods and rendering of poor services.
Negative attitudes of workers in carrying out assigned duties.
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There seem to be an insatiable demand from some employees in an organization.

1.3 PERFORMANCE APPRAISAL

Performance appraisal is a process of assessing, summarizing and developing the work performance of an
employee. In order to be effective and constructive, the performance manager should make every effort to
obtain as much objective information about the employees performance as possible. Low performance can
push the organization back in today’s tough competition scenario. The project is aimed at analyzing the
performance appraisal in “BANKING INDUSTRY”.

1.4 OBJECTIVES
To provide feedback to individual employees so that they can know where they stand and can improve their
performance.
To provide database for the decisions by the management regarding placement, promotion, transfer,
punishment etc.
To diagnose the strengths and weakness of individuals so as to identify training needs.
To provide counseling, career planning to subordinates.
To facilitate research in personnel management.
To test the effectiveness of recruitment, selection, placement and induction programmers.
Employee attitudes towards the present appraisal system.
To find out the performance dimensions relevant to the strategic plan of the company.
To identify the potential areas for the scope of improvement in the current system and thereby in the
organizational performance.
To study the implications of an effective performance appraisal system on the productivity of employees and
the organizational performance as a whole.
To provide suggestions and recommendations to improves the performance appraisal effectiveness.
To identify the key performance indicators and critical success factors for achieving organizational
excellence.

1.5 OBJECTIVE OF STUDY

Any survey report begins with stating the objective of the study: therefore, the first step in the survey
analysis deals with the objectives. Next the methodology adopted to collect the information required will be
dealt with, that is, the survey design will be described.
Generally, data source include primary and secondary sources. Primary data sources can provide a range of
information and therefore should be consulted first. If they don’t provide necessary information for the
research then secondary data is to be collected.

1.6 PURPOSE OF PERFORMANCE APPRAISAL

Developmental purpose: it helps to clarify the necessity and the effectiveness of the training programs.
Rewards purpose: helps in determining who should receive rewards and who should be laid off.
Motivational purpose: stimulates effort to perform better.
Legal compliance: it provides legally defensible reason for making promotion, transfer, rewards and
discharge decisions.
Compensation: help to identify what t pay and what will serve as an equitable monetary package.
Communication purpose: the rater and rate get to know each other through communication.
Human resource and employee planning purpose: it serve as a valuable input to skills inventories human
resource planning.

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 CHAPTER 02: LITERATURE REVIEW

2.1 OBJECTIVES OF THE STUDY

Although, there is a general believe that appraisal as a technique, motivate employees towards greater
productivity and therefore, it increases profit.
However, the objectives of this study are to:
 To examine the relationship between Performance Appraisal and Employees motivation.
 To determine the effect of high and low worker’s appraisal that motivate employees in an
organization.
 Finally, to contribute to the existing stock of knowledge in this specific subject area.

2.2 SIGNIFICANCE OF THE STUDY

There is a great need of a research of this kind at a time when questions are being asked to the practical and
theoretical foundation of performance appraisal on employee’s motivation in an organization.
However, this study shall provide new and avalanche knowledge to the following categories of people:
a. Professional Secretaries in an organization
b. Employees in an organization
c. The government
d. Trade Union
e. Scholars in this particular topic
f. Society at large

2.3 Literature Review

The act of motivating the employees is in the heart of the organizations. Success in every organization
depends upon the personnel motivation conducted by their directors.
Identifying the proficient employees and presenting them rewards as a sign of motivation, in order to
improve their performance are among the essential factors in performance appraisal. Nowadays,
performance appraisal is considered as an important aspect in human resources management and a part of
the control process in administration.
Many research’s has been done in past on performance appraisal. Researchers found different results from
those researches. Furthermore, literatures were reviewed and based on these reviews, hypothesis was
developed.
A research was conducted in Peninsular Malaysia wherein it was found that satisfaction with the
performance appraisals positively influence work performance and job commitment. This was the
quantitative research and correlation and regression analysis were used to analyze the result of the research.
Another research indicated that performance appraisal was significantly related to the job commitment,
intrinsic motivation mediated the relationship of job performance and performance appraisals.

2.4 The Concept of Performance Appraisal

While a number of organizations continue to use informal and subjective performance evaluation practices
to make reward decisions, there is evidence that objective performance evaluation practices an increasingly
prevalent in the current times. Gardner (2008) describes performance appraisal as the evaluation of an
individual‘s work with the main aim of arriving at objective personnel decisions. It is also considered as the
process of obtaining, analyzing as well as recording information that revolves about the relative worth of the
employee to the organization. This takes place through the planned interaction between an organization’s
supervisors and employees in which the former assess the performance of the latter. One of the main goals
in this case is the identification of strengths and weaknesses that form the basis of recommending actions for
improved employee performance.

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2.5 Fairness of performance Appraisal Systems

The practice of assessing performance of employees is a significant element for establishing organizational
fairness. Organizational justice has been defined as individual perception of honesty and fairness of the
organization administration. Organizational justice has the potential to create benefits to both employees and
the employer which includes greater commitment, improved job performance, improved customer
satisfaction and reduced organizational conflict. In PA practice, there are two approaches that are used to
determine whether PA system is fair or not and these are procedural and distributive justice. Procedural
justice is the awareness of the employees that the processes employed to evaluate their performance are fair
while distributive justice means that the input is commensurate to the output of the employee. Research also
has shown that the there is a relationship between supposed organizational fairness and employee work
performance. The effectiveness of PA is determined by the opinions of the employees. If employees
perceive that PA favors a particular kind of group and not everyone and that there is no relationship between
the job itself and PA system, this makes the system very ineffective and frustrating. A formal system of
appraisal is helpful for employees if it is perceived as fair. For employees to embrace the system as fair,
some conditions have to be met including: employees should have technical knowhow of the job; there
should be a platform of petitioning the feedback received; instruments used for the exercise should be
applicable; and a way of handling the challenges as they occur should be devised.

2.6 Performance Appraisal feedback

Feedback is an important part of the PA system, which is mostly presented to the individual during and after
the completion of the performance review. Performance feedback is the core function in PA process in
organizations and there is no organization that can enhance productivity when the employees are not aware
of how they are performing in relation to the set objectives of the organization. Performance Appraisals are
also used for administrative decisions, such as promotions, salary increase, and termination, and also for
developmental purposes. Therefore, the core function of performance feedback should be to better
performance with aim of increasing quantity and quality of output from employee through motivation. It is
therefore crucial to continually communicate the progress of employee performance that leads to complete
employee growth.
Performance feedback is valuable to both employee and the organization when is given in good time in that
it helps in developing mechanisms of correcting performance where there is need when is still vivid and
acceptable to the employees. This enhances better work development and employee altitudes.
Structured performance appraisals help employees to understand the perception the organization has on
them and the value they hold in it. Feedback to employees could be the most important information about
the PA system that employees receive in an organization about actual ratings that demonstrate appreciation,
value, and future prospects within the organization.

2.7 Uses of Performance Appraisal Results

Performance Appraisal is a tool that can be used to administer performance successfully, as it gives
information, which feeds into other parts of the performance management process. If used for intended
purpose, PA contribute to motivation, improved job performance and efficiency. Mathis and Jackson (2008)
condensed the uses of PA into two categories – managerial uses and developmental uses. In the managerial
function, it is used for determining employee salaries, promotion among others. While in developmental
uses is focused on building and strengthening the capacity of employees and building their career paths.
For the employee, PA serves a motivation for career progression by way of recognition, increased salaries,
elevation, and challenging responsibilities. For the supervisor, Performance Appraisal serves to guide in
functions like determining employees eligible for training, salary increment and termination.
The study will help to establish the best way of using performance appraisal to motivate the employees and
as a monitoring tool that will help the company to track progress and know when to change course.

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2.8 Performance Appraisal and Employee Motivation

Motivation represents an employee’s yearning and obligation, which is marked as exertion. Some people
want to complete an assignment but are effortlessly diverted or discouraged. They have elevated aspiration
but stumpy assurance. Other plod along with imposing determination, but their work is unimaginative.
These people have high commitment but low desire.
They demonstrate the need for improvement: If employees don’t have a clear understanding of how
they’ve been performing, they can’t be motivated to make any improvements. They meet higher-level
psychological needs: Researchers continue to find that recognition is one of the most powerful forms of
motivation for large numbers of employees. Although you can find numerous possible sources of
recognition on the job, performance appraisals are an opportunity for employees to receive formal,
significant, and enduring recognition from their manager.
They build a sense of personal value: When managers take the time and effort to carefully review,
analyze, document, and discuss performance with employees, the underlying message to the employees is
that they’re important and valuable, and this alone is quite rewarding, whether the feedback is positive or
not.
They enhance personal development: Performance evaluations are motivational for employees who are
looking to enhance their personal learning, growth, and development. Appraisals are a highly valuable
source of information, insights, and tools necessary for such progress. Performance appraisals are similarly
motivational for employees whose needs are centered on achievement, goal attainment, and sensing personal
effectiveness, respect, and trust.
They turn employees around: When employees are performing poorly, performance appraisals can
provide the wakeup call that they need to get refocused and reenergized. With performance appraisal,
however, the purpose of the session is not strictly disciplinary, so the employee is more likely to walk in
with a more receptive and open mind. As a result, your comments regarding an employee’s questionable
performance have an excellent chance of being heard and generating action as a result.
They increase satisfaction: When performance appraisals meet the employees’ needs in such areas as
gaining recognition, sensing achievement and competence, experiencing growth, and meeting objectives,
they’re also contributing to the employees’ job satisfaction, and this is one of the most important elements at
work today. When employees are satisfied, some of the most visible indicators are reduced turnover,
absenteeism, and tardiness.
The following are some definitions that begin to help us in considerate this elusive concept.
➢ Motivation is a predilection to act in an unambiguous goal intended for manner. (Hellriegel and Slocum)
➢ Motivation might be distinct as the circumstances of an individual’s perception, which represents the
potency of his or her tendency to put forth attempt toward some fastidious manners. (Gibson)
➢ Chiang and Jan (2008) defines employee motivation as ―the process of an employee being moved to
work. While further expounding on employee motivation.
➢ Wolff and Gunkel (2007) argue that motivation often results from the psychological need associated with
the need to gratify desires that remain unsatisfied.

Motivation is the process that that energizes employees and propels them to pursue their goals. Well-
designed and well-executed performance appraisals have a strong motivational impact. Appraisals have the
power to motivate employees because they provide a number of interconnected benefits. The reward system
of many organizations depend on performance appraisals done by Managers. PA is the process of setting
standards, assessing employee performance against the set standards, giving employee feedback on their
performance and making plans for performance improvement. The evaluation of Performance is done to the
employees with a view of motivating them and increasing commitment, which leads to higher productivity,
and also with an intention of guiding the employee in the right direction.

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2.9 Intrinsic and Extrinsic Motivation

Motivating employees to perform better and increase productivity is not an easy job. In any organization,
employees are either motivated by intrinsic or extrinsic needs, therefore it is the job of the supervisor to
understand the composition of the employees or this is mostly possible through performance appraisal.
From a human resource perspective, intrinsic motivation is considered as a form of motivation that captures
the aspects of doing work for its own sake. Further, intrinsic motivation is explained as one that provides the
employees with psychological benefits of wellbeing, self-actualization, increasing responsibility and self-
sustenance (Lee & Whitford)
Extrinsic motivation is on the contrary described in the field of human resource as the importance that
employees place on external rewards, which could include promotions and salary increases (mark). It could
also involve negative aspects such as the threat of dismissal or demotion. From a theoretical perspective, the
agency theory suggests that incentives that are offered by organizations as a way of increasing employees
‘intrinsic motivation are usually indispensable. The rationale in this case is that employee actions are either
rewarded or punished hence determining the employees ‘action and performance. (Cullen). While extrinsic
motivation factors such as pay are generally considered to have a positive impact on employee motivation a
number of researchers argue that they could to some extent undermine performance. Lee and Whitford for
instance note that excessive focus on extrinsic motivating factors may distract the employee from
concentrating on the task. The two authors consider this effect as the hidden costs of rewards

2.10 Herzberg ‘s Hygiene Theory of Motivation:

Several studies suggest the presence of a positive relationship between the intrinsic and extrinsic motivation
and the subsequent effect on performance. This positive relationship is well expounded in Herzberg ‘s
Hygiene Theory of motivation. From this theory, factors that are responsible for intrinsic motivation include
the work itself, recognition as well as personal achievement. Extrinsic factors are on the other hand the
hygiene factors which include salary and supervision. When linking the intrinsic and extrinsic motivation,
Herzberg note that the hygiene factors lead to job satisfactions as part of the intrinsic motivation process
since they satisfy the individuals internal need of self-actualization. The argument in this case is that
intrinsic and extrinsic motivation factors combine to have a positive impact on employee performance.

2.11 Role of Performance Appraisal in Enhancing Employee Motivation

Performance Appraisal and Employee Rewards

Motivation has great significance in an organizational setting. Its importance primarily lies in its ability to
initiate human behavior, direct and channel that behavior as well as sustain it. From this context, Emmerik,
Schreurs, Cuyper, and Peters argues that the performance appraisals can be used to motivate employees
through rewards such as promotions and salary increases. Based on Herzberg‘s theory, such rewards are in
the form of extrinsic rewards which can be used to boost performance.

Performance Appraisal for Motivation through Promotions

As part of the performance appraisal process, the evaluators measure the employee‘s performance and offer
a performance number. The performance number further leads to the development of level performance
number (LPN) which the management use as a platform to determine rewards as part of the motivation
process. Whenever there are new job openings beyond the entry level, the LPN becomes a useful reference
point for the managers to use for internal promotions. Such promotions not only serve as a reward for the
employee‘s past performance but also perform a crucial role in sending a message to co-workers that their
future hard work will indeed payoff. As such, other employees in the organization are motivated to improve
their performance.

Salary Increases and Bonus Payments

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Within the performance management literature one of the most dominant views is that money or pay-for-
performance is one of the most effective ways of rewarding employees and hence increased motivation.
Money in this case acts as an extrinsic motivator by satisfying the employee‘s needs indirectly through
means of bonuses and pay. Jensen and Murphy while explaining the rationale behind pay for performance
draw upon the reinforcement theory, which suggests that pay, can be linked to performance through setting
of specific targets. Employees are then reward based on their ability to achieve these targets. The extrinsic
motivation to earn more in this case influences employees to put in extra effort and better performance. In
the calculation of bonus payments, the sales and HR department may set expected performance level of an
employee such as the number of units sold. Employees who exceed the set thresholds receive incentive
payments such as an extra 2 percent for a given level of sales figures. Performance appraisals facilitate the
entire process.

Performance Appraisal and Employee Recognition

Performance appraisals have also been found to serve a useful purpose in employee motivation by providing
a platform for recognition of achievements (Brun and Dugas, 2008). Recognition in this context entails the
assignment of personal non-monetary awards that aid in reinforcing desired behaviors depicted by an
employee. It main include giving of praise through compliments; awards such as certificates of achievement
and private budgets; and ceremonies such as public celebrations and speeches. Past studies in this area
suggest that managers and other superiors should recognize the efforts of their employees as such behavior
may trigger innovation and application of behavior that leads to better performance.

2.12 Conceptual Framework

The independent variable of this study is performance appraisal, which has been operationalized in the form
of: setting work related goals; employee participation; fairness in the process; timely feedback; and usage of
results. The dependent variable is employee motivation, which is demonstrated by initiative, teamwork,
problem solving, and quality of work and enthusiastic employees.
The employer chooses PA as an assessment tool for measuring performance. The manner in which
assessment tool is administered has the potential to frustrate or motivate the employees to meeting the
objectives of the organization. The output of the PA process communicates to the employer the value of the
employees the organization holds.

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2.13 HYPOTHESIS

Based on literature review, all variables included dependent and independent variable are identified, now
based on these variables, hypothesis of the study is developed as “Performance appraisal has a positive
impact on the motivation of the employee.”

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 CHAPTER 03 RESEARCH METHADOLOGY
3.1 Chapter Introduction

This chapter is about discussing the methods that have been implemented by the researcher for completing
the study meaningfully and through successfully justifiable means. Some of the most essential aspects being
taken into account here are approach, philosophy, and paradigm of research, along with data collection and
analysis methods.

3.2 Research Approach

Academic researchers such as Bryman (2014); Adams, Khan and Raeside (2014) have come up with two
eminent types of approaches through which the studies can be conducted. These are inductive and deductive.
The former one works for the formulation of a theoretical perspective on the basis of the facts given;
whereas, the latter one supports the designing of hypothesis and test it with the help of previously
established theories (Easterby-Smith, Thorpe and Jackson, 2015). In the current study, the researcher has
attempted to consolidate deductive approach and the reason for this is that it will prove that whether any
significant and positive relationship exist between employees and employer and are they motivated enough
for their job. The selected approach further complements quantitative testing and thus, it is convenient to
analyze the strength with which the mentioned attributes are connected.

3.3 Research Strategy

According to Hair and Lukas (2014), implementation of right kind of strategy is very important because an
inappropriately selected strategy can affect the results in an extremely negative manner. Greenfield (2016)
brought into notice few commonly used strategies such as ethnography, actions research, survey, etc.
Keeping the argument, the researcher chose survey strategy for this study. The rationale for this selection is
that it acts as direction and helps in executing the study in the most accurate manner. It is also essential to
consider that the survey strategy also plays an important role in assisting the researcher to set the right kinds
of methods for the collection of data. Moreover, another justified reason for the incorporation of survey
strategy is that it supports the chosen deductive research approach and together, these methods yield the
results in the best way possible. Keeping research topic in mind choices that researcher had chosen mono
method. As in mono method researcher gather only one type of information from qualitative and
quantitative. This method can be used to research on the opposing view that exists in the mono-method. For
researcher it is necessary to consider choices- mono method as research depends on quantitative.

3.4 Time Horizon

The research design utilized in this study is explanatory. The researcher applied this because as per the
information shared by Schwab (2013), “Explanatory design is capable of elaborating upon the prevailing
facts and information which eventually enable the researcher to reach to a better conclusion”. There are
numerous designs that were being used by other researchers in the past. Keeping the survey in mind cross
sectional has been used for this research, as researcher can use qualitative and quantitative research in the
cross-sectional method. It may help in observing the behavior of people.

3.5 Technique Data Collection and Data Analysis

For collection of data the source was survey. The reason for considering it to examine the trend of how
employee motivation and performance appraisal that has been conduct in their respective organization. The
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instrument of this research is a survey questionnaire, the tool through which primary data has been collected
specifically. For clearer understanding the researcher tested employee’s motivation towards their job. The
survey questionnaire consists of questions on each of these variables so as to know about these from the
research participants. Moreover, the questionnaires for survey have been distributed online among the
respondents. For data analysis, the method for data analysis is quantitative because the formulated
hypothesis can only be tested and assessed through statistical techniques. For this matter, the SPSS tool of
quantitative analysis has been undertaken. The sample size for selected and finalized for this study is 80.
Respondents of the study are the employees from Banking Industry. The reason why employees are the most
accurate choice to include as research participants is that they are believably at a reasonable place to answer
that what factors impact on their performance and motivation for work which will effects their position in
the organization.

3.6 Ethical Considerations

For avoiding any issue arising from moral and ethical perspective, concerns are considered. These are as
follows;

Confidentiality – It has been assured that no sort of information provided by the employees; either
professional or personal shall get revealed.
Autonomy – The next concern is of autonomy has also been considered. Following this, the employees have
also been told none of them is pressurized for their participation.

3.7 Chapter Summary

The chapters conclude that this study followed a mono method and focused upon the conductance of the
research through quantitative techniques. The approach used was deductive and the design incorporated was
explanatory. Furthermore, 65 employees from Banking Industry were approached. Survey questionnaire was
made and distributed online and were analyzed with the help of SPSS software.

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 CHAPTER 04: DATA ANALYSIS

4.1 Respondent’s data in tables and bar charts

Age of Respondent Gender Pay Scale Organization Which method of

Name performance
appraisal is
implemented in
your organization

65 65 65 65 65

Performance Performance I believe that The monitoring I am

appraisal is for appraisal gives unfairness in the of performance compensated
Employee constructive performance appraisal should fairly and
Motivation criticism in a appraisal process be financial recognized for
friendly and can lead to targets as well as my
positive manner creating a behavioral accomplishments
negative wave of aspects of
impact on employees.
employee
retention within
the organization.

65 65 65 65 65

I am motivated to go I feel encouraged to Does a performance There should be

an extra mile at work come up with new appraisal negatively regular evaluation
and better ways of or positively affects and feedback on
doing things in my the moral life of quarterly basis so
current employment. employees. that employees may
have a chance to
improve.

65 65 65 65

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 Frequency Table

Age of Respondents

Frequency Percent Valid Percent Cumulative

Percent

20 yrs - 30 YEAR 43 66.2 66.2 66.2

31 yrs - 40 yrs 15 23.1 23.1 89.2

41 yrs - 50 yrs 6 9.2 9.2 98.5

50 yrs - 60 yrs or above 1 1.5 1.5 100.0

Total 65 100.0 100.0

Gender

Frequency Percent Valid Percent Cumulative Percent

Male 38 58.5 58.5 58.5

Female 27 41.5 41.5 100.0

Total 65 100.0 100.0

Pay Scale

Frequency Percent Valid Percent Cumulative

Percent

20K - 50K 48 73.8 73.8 73.8

51K - 80k 10 15.4 15.4 89.2

81K - 100K or above 7 10.8 10.8 100.0

Total 65 100.0 100.0

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 Organization Name

Frequency Percent Valid Percent Cumulative Percent

Faysal Bank 13 20.0 20.0 20.0

Habib Metro Bank 29 44.6 44.6 64.6

SILK BANK 23 35.4 35.4 100.0

Total 65 100.0 100.0

Which method of performance appraisal is implemented in your organization

Frequency Percent Valid Percent Cumulative

Percent

Assessment center method 5 7.7 7.7 7.7

I Don't Know 34 52.3 52.3 60.0

BARS 1 1.5 1.5 61.5

Other 7 10.8 10.8 72.3

360 degree 3 4.6 4.6 76.9

Bell Curve 11 16.9 16.9 93.8

Human Resources Cost

4 6.2 6.2 100.0
Accounting Method

Total 65 100.0 100.0

Performance appraisal is for Employee Motivation

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 Frequency Percent Valid Percent Cumulative Percent

Strongly Disagree 7 10.8 10.8 10.8

Disagree 2 3.1 3.1 13.8

Neutral 8 12.3 12.3 26.2

Agree 17 26.2 26.2 52.3

Strongly Agree 31 47.7 47.7 100.0

Total 65 100.0 100.0

Performance appraisal gives constructive criticism in a friendly and positive manner

Frequency Percent Valid Percent Cumulative Percent

Strongly Disagree 2 3.1 3.1 3.1

Disagree 6 9.2 9.2 12.3

Neutral 18 27.7 27.7 40.0

Agree 28 43.1 43.1 83.1

Strongly Agree 11 16.9 16.9 100.0

Total 65 100.0 100.0

I believe that unfairness in the performance appraisal process can lead to creating a negative wave of
impact on employee retention within the organization.

Frequency Percent Valid Percent Cumulative Percent

Strongly Disagree 2 3.1 3.1 3.1

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 Disagree 2 3.1 3.1 6.2

Neutral 8 12.3 12.3 18.5

Agree 32 49.2 49.2 67.7

Strongly Agree 21 32.3 32.3 100.0

Total 65 100.0 100.0

The monitoring of performance appraisal should be financial targets as well as behavioral aspects of
employees.

Frequency Percent Valid Percent Cumulative Percent

Strongly Disagree 2 3.1 3.1 3.1

Disagree 6 9.2 9.2 12.3

Neutral 10 15.4 15.4 27.7

Agree 35 53.8 53.8 81.5

Strongly Agree 12 18.5 18.5 100.0

Total 65 100.0 100.0

I am compensated fairly and recognized for my accomplishments

Frequency Percent Valid Percent Cumulative Percent

Strongly Disagree 2 3.1 3.1 3.1

Disagree 6 9.2 9.2 12.3

Neutral 20 30.8 30.8 43.1

Agree 29 44.6 44.6 87.7

Strongly Agree 8 12.3 12.3 100.0

Total 65 100.0 100.0

I am motivated to go an extra mile at work

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 Frequency Percent Valid Percent Cumulative Percent

Strongly Disagree 1 1.5 1.5 1.5

Disagree 7 10.8 10.8 12.3

Neutral 14 21.5 21.5 33.8

Agree 30 46.2 46.2 80.0

Strongly Agree 13 20.0 20.0 100.0

Total 65 100.0 100.0

I feel encouraged to come up with new and better ways of doing things in my current employment.

Frequency Percent Valid Percent Cumulative Percent

Strongly Disagree 2 3.1 3.1 3.1

Disagree 5 7.7 7.7 10.8

Neutral 12 18.5 18.5 29.2

Agree 31 47.7 47.7 76.9

Strongly Agree 15 23.1 23.1 100.0

Total 65 100.0 100.0

Does a performance appraisal negatively or positively affects the moral life of employees.

Frequency Percent Valid Percent Cumulative Percent

Valid Strongly Disagree 1 1.5 1.5 1.5

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 Disagree 1 1.5 1.5 3.1

Neutral 6 9.2 9.2 12.3

Agree 29 44.6 44.6 56.9

Strongly Agree 28 43.1 43.1 100.0

Total 65 100.0 100.0

There should be regular evaluation and feedback on quarterly basis so that employees may have a
chance to improve.

Frequency Percent Valid Percent Cumulative Percent

Disagree 1 1.5 1.5 1.5

Neutral 5 7.7 7.7 9.2

Valid Agree 36 55.4 55.4 64.6

Strongly Agree 23 35.4 35.4 100.0

Total 65 100.0 100.0

Bar Chart

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 Questionnaires were distributed among the employees of 3 different Banks.
 Majority of the employees are aged between 20 to 30 years.

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 There is not much difference seen in Male and Female population.
 41.5% were female population and 58.5% were male population.

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 73% of the bank employees have a Pay Scale of 20k to 50k.
 Only 26.2% employees having pay scale above 50k.

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 Questionnaires were distributed among the employees of 3 different Banks.
 Faysal Bank, Habib Metro Bank and Silk Bank

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 34% of the employees don’t know about the current performance appraisal methods followed in the
organization.
 Even many employees from same bank chosen different appraisal method.
 This shows that majority of the employees in these banks are not aware about their appraisal method.

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 Research shows that majority of the employees think that performance appraisal is for employee
motivation
 Only few were disagreed with the statement

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 Research shows that majority of the employees think that appraisal gives constructive criticism in a
friendly and positive manner.
 Very less population was disagree with the statement.

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 Majority of the employees have this understanding that unfairness in the performance appraisal
process can lead to creating negativity in an employee.
 Same as other only few were disagree with this statement.

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 Majority of the employee agree with that performance appraisal should be financial as well as
behavioral aspects of employees.

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 Employees from these banks believe that they are compensated fairly and recognized for their
accomplishments.
 However 30% from the total population were confused and Neutral that means they have mixed
thinking over this statement.

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 Employees believe that they are motivated to achieve an extra mile at work.

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 Research data shows that employees are encouraged to come up with Ideas and better ways of doing
things.

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 Employees also believe that Performance appraisal has very serious outcomes on moral life of an
employee.
 It can affect any employee positively and negatively both

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.

 Many organizations don’t evaluate their employees regularly instead they evaluate their employees at
the time of appraisal.
 Research date shows that employee wants to be evaluated regularly to be updated and to get a chance
to improve their performance.

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 CHAPTER 05: REPORT CONCLUSION

5.1 Conclusion
This research was conducted to analyze the methods of performance appraisals being used in different banks
and how much their employees are aware and satisfied with appraisal method being used in the organization,
and enough motivated towards his/her work. Three well known banks were chosen for the research and
questionnaires were distributed among the no of employees of these banks.
Research data shows that majority of the employees of these organizations don’t know that which method of
performance appraisal is being used in their organization, more than 50%, out of 65 peoples 34 were not
aware about the appraisal method used in their organization.
As per the research majority of the employees except those who don’t know about current appraisal method
of the organization have selected different appraisal methods, even different results were seen with in the
same organization.
Our Hypothesis was right that majority of the employees of selected organizations don’t know about the
current Appraisal methods used in their organization. But we reached to one point that from 65 respondent’s
majority of them are motivated towards their work.
It was learned from the research that organizations should keep their employees updated about their
appraisal methods to eliminate the demotivation factor among the employees. An employee satisfaction with
his/her work is necessary for the growth of any organization and for employees both. If the employee is not
aware about the criteria on which his/her annual appraisal is being conducted he/she will consider the
appraisal a source of demotivation and will increase the turnover ratio of the organization.

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