Faculty of Law

BATCH 2019-2024

TOPIC: PERFORMANCE APPRAISAL: CASE STUDY OF

MICROSOFT COMPANY.
SUBJECT: HUMAN RESOURCE MANAGEMENT (HRM).
SUBJECT CODE: 10BC0303.

Submitted to: Submitted by:

Dr. Krunal Purohit. Jainam Shah
Assistant Professor Roll No: -91901041010
Faculty of Law, Marwadi University B.com LLB Hons.
(Semester III)

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 DECLARATION

I JAINAM SHAH certify that the work embodied in this project work, entitled
“PERFORMANCE APPRAISAL: CASE STUDY OF MICROSOFT COMPANY”, is my
own bona-fide work carried out by me under the supervision of Assistant professor Dr.
KRUNAL PUROHIT of Faculty of Law, Marwadi University. The matter embodied in this
Project has not been submitted for the award of any other degree/diploma.

I declare that I have faithfully acknowledged, given credit to and referred to the authors/ research
workers wherever their works have been cited in the text and the body of the project. I further
certify that I have not willfully lifted up some other's work, para, text, data, results, figures etc.
reported in the journals, books, magazines, reports, dissertations, theses, etc., or available at web-
sites and included them in this project work and cited as my own work.

SIGNATURE OF THE STUDENT

DATE:
PLACE:

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 SUPERVISOR’S CERTIFICATE

This is to certify that the work embodied in the accompanying project entitled
“PERFORMANCE APPRAISAL: CASE STUDY OF MICROSOFT COMPANY”, has
been carried out entirely by Jainam Shah under my direct supervision and guidance and that the
candidate has fulfilled the requirements of the regulations laid down for the partial fulfillment of
B.COM. LL. B (Hons.) Degree examination in the course Human Resource Management
(Semester III), Faculty of Law, Marwadi University.

Dr. KRUNAL PUROHIT.

Assistant Professor (Human Resource Management)
Faculty of Law, Marwadi University

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 ACKNOWLEDGEMENT

I would like to express my thanks to the people, who have helped me most throughout my
project, be it directly or indirectly. I am most grateful to my teacher Dr. KRUNAL PUROHIT
who inspired to do this project by providing this opportunity.

A special thank of Mine faculty sir Dr. Krunal Purohit Sir who helped me out in completing the
project, where they all exchanged their own interesting ideas, and made me realize both the
perspectives to the issue and thus made it possible to complete my project with all accurate
information. I wish to thank my parents for their personal support or attention who inspired me
to go my own way.

Last but not the least, I would also extend my appreciation to those who could not be mentioned
here but well played their role to inspire the curtain.

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 INDEX

CHAPTER-I INTRODUCTION. 06.

1.1 HUMANCE RESOURCE MANAGEMENT. 06.
1.2 PERFORMANCE APPRAISAL. 08.
CHAPTER-II PROBLEM OF CASE STUDY. 12.
CHAPTER-III CASE STUDY OF MICROSOFT (PERFORMANCE 14.
APPRAISAL).
3.1 INTRODUCTION TO CASE STUDY. 14.
3.2 PROBLEMS AND LIMITATIONS OF THE CASE STUDY. 15.
3.3 SOLUTION FOR THIS CASE STUDY BY APPLYING METHODS OF
18.
PERFORMANCE APPRAISAL.
CHAPTER-IV CONCLUSION AND FINDINGS 23.
CHAPTER-V BIBLIOGRAPHY / REFRENCES 25.

CHAPTER-I
INTRODUCTION.

1.1 HUMAN RESOURCE MANAGEMENT: -

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Human Resource Management (HRM) is an operation or the procedure in companies designed to
maximize the performance of the employee in order to meet the employer's / company’s strategic
goals and objectives. So, basically, more precisely, HRM focuses on management of people
within companies which basically emphasizing on policies and systems.

In short, HRM is the process or an operation of recruiting, selecting employees, providing proper
orientation and induction, imparting proper training and developing skills needed to the
employees who are working in any organisation or any company or under employers.

HRM also includes or perform job of employee assessment like performance appraisal,
facilitating proper compensation and benefits, encouragement, maintaining proper relations with
labour and with trade unions, and taking care of employee safety, welfare and health by
complying with labour laws of the state or any country concerned.

Since mid-1980’s year Human Resource Management (HRM) has gained acceptance in both the
sector that is academic and commercial circle. HRM is a multidisciplinary organizational
function that draws or implement various theories and ideas from various fields such as
management, psychology, sociology and economics.

There is no other best way to manage people and no manager has formulated how people can be
managed effectively, because people are becoming complex beings with complex needs.
Effective HRM depends much on the causes and conditions that an organizational setting would
provide. Any Organization or companies has three basic components that is People, Purpose, and
Structure.

In year 1994, a noted leader in the human resources (HR) field had made some observation
which are as follows:
Yesterday, the company with the access most to the capital or the latest technology had the best
competitive advantage.
Today, companies that offer products with the highest quality are the ones with a leg up on the
competition; But the only thing that will uphold a company’s advantage tomorrow is the caliber
of people in the organization.

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That predicted future is the today’s reality. Most of the managers in the both public and private
sector firms of all sizes would agree that people truly are the organization’s most important asset.
Having enough competent staff on the payroll does not guarantee that a firm’s human resources
will be a source of enough competitive advantage. However, in order to remain or to maintain
the position of competitive, to grow, and diversify an organization, must have to ensure that its
employees are qualified and they are placed in appropriate positions, properly trained, managed
effectively, and committed to the firm’s success. The crucial and basic goal of HRM is to
maximize employees’ contributions in order to achieve optimal productivity and effectiveness,
while simultaneously attaining individual objectives (such as having a challenging job and
obtaining recognition), and societal objectives (such as legal compliance and demonstrating
social responsibility).

Definition of HRM:

According to the INVANCEVICH AND GLUECK, “HRM is concerned with the most
effective use of people to achieve organizational and individual goals. It is the way of managing
people at work, so that they give their best to the organization”.

According to DESSLER (2008) the policies and practices involved in carrying out the “people”
or human resource aspects of a management position, including recruiting, screening, training,
rewarding, and appraising comprises of HRM.

According to FLIPPO “HRM is the planning, organizing, directing and controlling of the
procurement development compensation integration, 4intenance and separation of human
resources to the end that individual, organizational and social objectives are accomplished”.

According to the NATIONAL INSTITUTE OF PERSONNEL MANAGEMENT (NIPM) of

India has defined Human Resources as “that part of management which is concerned with people
at work and with their relationship within an enterprise. Its aim is to bring together and develop
into an effective organisation of the men and women who make up an enterprise and having

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regard for the well-being of the individuals and of working groups, to enable them to make their
best contribution to its success”.

According to DECENZO and ROBBINS “HRM is concerned with the people dimension in
management. Since every organisation is made up of people, acquiring their services, developing
their skills, motivating them to higher levels of performance and ensuring that they continue to
maintain their commitment to the organisation are essential to achieving organizational
objectivities. This is true, regardless of the type of organisation-government, business, education,
health, recreation or social action”.

Thus, HRM can be defined as a process of procuring, developing and maintaining competent
human resources in the organisation so that the goals of an organisation are achieved in an
effective and efficient manner. In short, HRM is an art of managing people at work in such a
manner that they give their best to the organisation for achieving its set goals.

1.2 PERFORMANCE APPRAISAL

Basically, the Performance Appraisal is the process of assessing or evaluating employee

performance by way of comparing or by evaluating the difference between the present
performance with already established standards (performances) which have been already
communicated to employees, subsequently after the completion of evaluating process the process
of providing feedback to employees about their performance level starts for the purpose of
improving their performance as needed or recommended by the organisation or company.

As said in the above mentioned para, the very basic and important purpose of performance
uprising is to know or evaluate the performance of employee by the process of assessing or
evaluating, subsequently another purpose arise that is to decide whether training is needed to
particular employee or to give promotion with additional pay hike. So, basically, Performance
Appraisal is the tool which help for determining whether employee is to be promoted, demoted
or sacked (remove) in case of performance (very Good, Good and bad) and in the case of no
scope for improvement.

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Generally, each and every corporate sector exercising Performance Appraisal as a tool for
knowing about the employee (performance level) and using this tool to take decisions against
any employee after determining completely about that employee. There are different methods of
Performance Appraisal which are divided under the category of traditional methods and modern
methods which will discuss further in this project.

WHAT IS PERFORMANCE?

The term “Performance” basically means that when employees are performing well when they
are productive. Productivity concern with both effectiveness and efficiency, here effectiveness
refers to goal accomplishment. However, it does not express about the costs incurred in reaching
towards the goal. Now here the other word efficiency, here efficiency evaluates the ratio of
inputs consumed to achieved or accomplish all the outputs.

In addition to productivity as measured and acknowledged in terms of effectiveness and

efficiency, Performance also includes some personnel data such as measures of accidents,
turnover, absences, and tardiness. The good employee is the one who not only performs well in
terms of productivity but also minimizes or drop the problems for the organisation by being to
work on time, by not missing days, and by minimizing the number of work-related accidents.

WHAT IS APPRAISAL?

The term “Appraisals” basically are the judgments of the characteristics, traits and performance
of others. Based on these judgments the company or organisation assess or evaluate the worth or
value of others and identify or determine what is good or bad. In industry Performance Appraisal
is a systematic evaluation of employees done by supervisors. Employees also wish to know their
position and level in the organization. Appraisals are essential and crucial for making many
administrative decisions like selection, training, promotion, transfer, wage and salary
administration etc.
That’s why the Performance Appraisal is a systematic and objective way of judging the relative
worth of ability of an employee in performing his task. Performance appraisal helps to identify
and determine those who are performing their assigned tasks well and those who are not and help
in determining the reasons for such performance.

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 PERFROMANCE APPRAISAL PROCESS

ESTABLISHING PERFORMANCE STANDARD

COMMUNICATING ESTABLISHED PERFORMANCE STANDARD TO EMPLOYEES

TRADITIONAL MORDERN METHODS

METHODS
MEASURING ACTUAL  Management By
 Ranking Method. PERFORMANCE OF Objectives (MBO).
 Paired EMPLOYEES BY  Behaviourally
Comparison. ADMINISTERING BY Anchored Rating
 Grading. SUITABLE METHOD. Scales.
 Forced  360 Degree
Distribution Appraisal.
Method.  Cost Accounting
 Forced Choice Method.
Method & COMPARING ACTUAL
Checklist Method. PERFORMANCE WITH
 Critical Incident STANDARD PERFORMANCE
Methods.
 Graphic Scale
Method.
 Essay Method. IDENTIFYING GAPS IN THE
 Field Review PERFORMANCE OF
Method. EMPLOYEES
 Confidential
Report.
REWARDING FOR BEST AND
TAKING CORRECTIVE
ACTIONS FOR POOR
PERFORMANCE

DEFINITIONS OF PERFORMANCE APPRAISAL:

Performance appraisal has been defined by different scholars in multiple ways. Some of the
important definitions defined are as follows:

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Dale S. Beach: has defined that "Performance appraisal is systematic evaluation of the
individual with respect to his or her performance on the job and his or her potential for
development".

Randall S. Schuler: has defined that "Performance appraisal is a formal, structured system of

measuring and evaluating an employees job, related behaviour and outcomes to discover how
and why the employee is presently performing on the job and how the employee can perform
more effectively in the future so that the employee, organisation, and society all benefit."

Heyel: has defines that "It is the process of evaluating the performance and qualifications of the
employees in terms of the requirements of the job for which he is employed, for purposes of
administration including placement, selection for promotions, providing financial rewards and
other actions which require differential treatment among the members of a group as
distinguished from actions affecting all members equally."

Dale Yoder: has defined that ''Performance appraisal includes all formal procedures used to
evaluated personalities and contributions and potentials of group members in a working
organisation. It is a continuous process to secure information necessary for making correct and
objective decisions on employees."

Problem with the

forced ranking
system was that it
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was a biased process
of
determining the
employees that are
going to get the
incentives for
excellent
performance
Problem with the
forced ranking
12
system was that it
was a biased process
of
determining the
employees that are
going to get the
incentives for
excellent
performance

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 CHAPTER-II
PROBLEM OF CASE STUDY

Here, this chapter deals with the problems and the limitation which were occurred in this case
study. The Case Study is of the Microsoft company and here in this has performed Performance
Appraisal program to solve the limitation and problem which were arise. So here I would like to
discuss thing into a Case Study which is known as Case Study of Microsoft Company and
Performance Appraisal.

The researcher would like to acknowledge the key contents or points and they are the firstly,
Problem and Limitation of the Case Study, then the next chapter will deal the complete Case
Study in Detailed which will also include the Solution (applied methods of Performance
Appraisal) to solve this Case Study and lastly, the chapter deals with the Finding and
Conclusions of the Case Study.

So basically, the limitations and problems of this case study started with the problem of
Discrimination between the employees in the Microsoft company. The problem of this
Discrimination has been elaborated briefly with the paragraphs and they are as follows:

DISCRIMINATION: -

In the Microsoft companies there were some Black American who were working as an
employees and this employees had complained and the subject matter of this complaint was
unfair practices (Discrimination) which were done against those employees by the Microsoft
Companies and which led them to eventually file the cases.

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So basically, the employees that unfair practices was done for the salaries they were mentioning
about that they are getting low salaries as compared to the White American employees in the
Microsoft Companies who were experiencing bonuses and incentives out of their assessing or
evaluated performances.

Black American further mentioned that also frequently did not get any high or good ratings
during performance assessments that essentially prevented them from getting accepted with
regard to their applications for higher office.

These poor performance assessments or evaluated scores also were usually used as basis for the
management of Microsoft to expel what they believed were underperforming employees from
their workforce and replace them more competent workers. So generally, this were the most
critical problem which was arise in this Case Study of Microsoft.

Furthermore, there were many challenges and issued were arise in the Microsoft which were
become the limitations for the company. So now this limitation the researcher would like to
acknowledge in the next chapter which is dealing with the Case Study in Detailed.

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 CHAPTER-III
CASE STUDY OF MICROSOFT (PERFORMANCE APPRAISAL).

3.1 INTRODUCTION TO CASE STUDY

Before acknowledging the Case Study, the researcher would like to briefly introduce the
Microsoft Company. Microsoft basically deals with the Computer Hardware and Software
Industry which are most reliable and progressive computer Software company in the world.
Microsoft was established in the year 1975 and its was established by Bills Gates.

During the period of the year 1990’s, Microsoft could be recalled that the world’s largest or
number one Computer Software and Hardware Industry. Generally, it was dominated by IBM,
but while still Microsoft was still way behind but nonetheless was already providing excellent or
competitive competition. But if we talk about the present or current situation is completely
reversed.

Furthermore, during the time of the success of Microsoft, IBM decided to neglect the
development of its organizational culture and its employees and concentrate more and more on
efforts to sustain or to gain their profitability. IBN invested heavily or vastly in research and
development activities to find out the most important computer products that were being needed
by the people.

Furthermore, on the part of Microsoft Company, instead of worrying so much about maximizing
their profits, Bill Gates prioritized on strengthening the organizational culture of the company.
Bill Gates helped instill the values, mission and vision that would remain as the solid foundations
of achieving success in Microsoft. Bill Gates had focused more in addressing the needs of the

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employees and making ensure that they would be working in or under an environment that can
bring out the best in their capabilities and skills.

Such aforementioned were the vision of Bills Gates that he knew that profitability and progress
would eventually come if he took care of Microsoft’s organizational culture first. Further Bill
Gates never worried about the big lead that IBM was having during the 1980’s because he knew
that Microsoft’s time to dominate the computer hardware and software industry would come.

Bill Gates was not worried about the slow results or output because Bill Gates realized that as the
employees and leaders of the Microsoft are given some adequate time to understand the purpose
and objectives of the company, the more productive and profitable the company is going to be in
the long run or long race.

Furthermore, the prophecy of Bill Gates turned out to be the correct one as the strong and solid
organizational culture of Microsoft that took years to establish eventually proved as the winning
formula for the Microsoft Company to go or move ahead of IBM in the field of Computer
Hardware and Software Industry. However, it is very important and pertinent to note that there
were plenty of the challenges and the issues that Microsoft Company had to face especially in its
human resource management prior to achieving an excellent organizational culture.

3.2 PROBLEMS AND LIMITATIONS OF THE CASE STUDY

Now acknowledge the problem and limitation which were arise in this case study, I would like to repeat
the problems which has been drafted in the previous chapter and it says that the problem of
Discrimination between the employees in the Microsoft company. The problem of this
Discrimination has been elaborated with the paragraphs and they are as follows:

DISCRIMINATION: -

In the Microsoft companies there were some Black American who were working as an
employees and this employees had complained and the subject matter of this complaint was
unfair practices (Discrimination) which were done against those employees by the Microsoft
Companies and which led them to eventually file the cases.

17
So basically, the employees that unfair practices was done for the salaries they were mentioning
about that they are getting low salaries as compared to the White American employees in the
Microsoft Companies who were experiencing bonuses and incentives out of their assessing or
evaluated performances.

Black American further mentioned that also frequently did not get any high or good ratings
during performance assessments that essentially prevented them from getting accepted with
regard to their applications for higher office.
These poor performance assessments or evaluated scores also were usually used as basis for the
management of Microsoft to expel what they believed were underperforming employees from
their workforce and replace them more competent workers. So generally, this were the most
critical problem which was arise in this Case Study of Microsoft.

Furthermore, there were many challenges and issued were arise in the Microsoft which were
become the limitations for the company. So now this limitation the researcher would like to
acknowledge in the next chapter which is dealing with the Case Study in Detailed.

Furthermore, here the researcher would like to acknowledge the limitations which were arise in
this critical situation for Microsoft Company. So here the following points which describe the
LIMITATION:

 Many Factors from the both internal and external business environment impact the
Performance Appraisal process.
 As a key external factor may be considered the employee unions and the law, whereas as
the internal factors may be considered the culture of the company and the increasing use
of teams for the work execution.
 In the company of Microsoft, there are no employee unions as a multinational enterprise
is extremely careful to any legal issues. The culture of the company, although it
emphasizes employee initiatives and teamwork, it could be said that it is rather strict, and
the employee must follow the hierarchy instead of taking independent decisions. This is a
hindrance to employee empowerment.

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There are many small and tiny issues which were arise and research would like to acknowledge
those issues which are as follows:

LEGAL RESTRICTION:

 There were many Legal Restriction which were imposed on Microsoft Company that the
form of assessment chosen by the company should be reliable, accurate and above all
legal.
 Otherwise, the conclusions would not be a sound basis for decisions on matters relating
to personnel and potentially laws such as equal employment opportunities may be
affected. Such issues arise when an employee is dismissed, demoted or his/her promotion
is not realized by that particular where he/she is working.
 Further, Microsoft particularly must be careful on issues such as racial, religious and sex
determine.
 However, it was noticed by the legal authority that top management positions are mostly
occupied by the White American males.

ERROR OF CENTRAL TENDANCY:

 There were some reviewers who do not wish to present the employees of Microsoft as
fully effective or ineffective, and so they rate everyone near the accepted average,
something that in was in the case of Microsoft Company.
 The output of the findings provides assessments that are not comparable with
themselves, and they are completely unsuitable for statistical analysis or for other
purposes.

INTERCULTURAL EFFECTS:

 Every employees of the Microsoft expects others to develop responses and attitudes
based on his/her own culture. So, the problem appears or arose out in this case was that
the people from the different nationalities and they must work together as employees of
Microsoft.
 Microsoft Company is a multinational company and the people from the different
nationalities must have to cooperate.

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  So far as in the company there has not been a particular programme aiming at the
training people to work with people from other cultures.

PERSONAL BIAS:

 There were the negative perceptions of an evaluator of the Microsoft for a particular
group of people or employees because of this negative perception they can distort by the
rating they receive.
 For example: many a time it has been observed that some male supervisors are unfair to
the women subordinates who hold traditionally male jobs.
 Furthermore, the phenomenon of this discrimination between men and women is
something which is still exists to a lesser degree than before.

EVALUATORS PREJUDICES:

 So, the basic problem with subjective methods is the possible influence of the outcome by the
evaluators and the personality traits, ideas and opinions that they have, or even the kind of the
relationships they have with the evaluated employees.
 Furthermore, the training of the managers that carry out assessment or evaluation would
definitely help or assist to reduce the subjectivity problem.
 So far as, only the Managing Directors of all subsidiaries have received training on employee
Performance Appraisal and although subjectivity is not reduced, it was eliminated to a large
extent.
 The training program must be expanded to the other managerial position of Microsoft Company
since it has been noticed that subjectivity played a very crucial role in subordinates Performance
Appraisal.

GRACE AND RIGOR:

 In this case, the assessor or evaluator makes the assessment with relative ease and
ranks favorably while the opposite happens with the manager that seeks to appear
‘tough’ and is negative in appraising employee performance.

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  The effects of grace and hardness are very extreme, and which causing grievances and
problems and are usually presented in companies with vague ideal performance levels.
 This was also the case which contain some qualitative jobs in Microsoft whereas the
performance levels were vague, and the line of responsibilities were also vague, and
the employee was subject to the assessor’s personal grace or rigor.

3.3 SOLUTION FOR THIS CASE STUDY BY APPLYING METHODS OF

PERFORMANCE APPRAISAL

Now the researcher would like to conclude the case study by acknowledging the solution which
were applied by the Microsoft Company to solve this case study and here the company had used
the method of Performance Appraisal as solution which has been explained as follows:

The solution which was made that was the change in the system of Performance Appraisal which
was exist in the Microsoft Company at that time, it was the change from the forced ranking
system towards other methods based on working conditions.

The basic problem with the forced ranking system was that it was a biased process in nature for
determining the employees that are going to get the incentives for excellent performance.

Furthermore, the Microsoft Company came with certain Methods which was used as solution for
the case study and they are as follows:

 Rating Scales.
 Critical Incident Method.
 Balanced Scorecard.
 360 Degree Feedback.
 Field Review Method.

Now hereby, the researcher would like to acknowledge each and every method with a brief
explanation which will contain that how this method used as a solution to solve this case study.

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1. RATING SCALES: Rating Scales is one of the oldest and most frequently occurring
Performance Appraisal Method that requires the existence of an evaluator or assessor
who gives a score or ratings for or against the performance of each employee of
Microsoft Company which is based on a scale ranging from the lowest to the highest
level.

The responses of the evaluator or assessor can be linked to numerical values or ratings
allowing this way to export average scores for each employee which can then be
compared. There is the direct relation of this method to the reward system and salary
increase system.

The advantages of this method is the low development and management cost, the
assessor’s or evaluator’s do not require significant training or a lot of time to complete
the relevant criteria form as well as that it can be applied to a large number of employees.

There are also some pretty disadvantages and they are Prejudices, perceptions and
personality traits of the head may affect the assessment to be made as well as the
relationship she/he has with each sub-ordinate.

This was the method of Performance Appraisal which was used by the Microsoft
Companies to solve a subject matter of Rating or scoring to employees in the Microsoft
Company.

2. CRITICAL INCIDENT METHOD: Basically, in this method the evaluator or the

assessor observe and records or note very good and bad behaviour of the respective
employee that occur during the period the appraisal takes place.

The observation are generally grouped and it was based on the criterion on which such
cooperative, work quality, consistency, etc. and then the conclusions for the employee are
drawn out or noted down, his/her strong points as well as the points that need
improvement.

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 Basically, employers or the companies often use this method in addition to the method of
rating scales method. This method ensure that the supervisor think of the subordinate
throughout the year because this event must be accumulated.
The most crucial and useful feature of this method is to draw conclusions directly related
to the job and the benefit particularly the employee. In addition, it would further reduce
the effect of Personal Bias of the head.

The main disadvantages for this method is that the assessors or the evaluators record
events in the beginning of the Appraisal period, which is followed by a blank space
where they neglect their duties and when the time of Appraisal comes, they observe and
record or note behaviour. In this case study, the assessors or evaluators is affected by the
events of the past and the result or the output may not be objective.

The method of critical incidents consumes much time of supervisor’s and it is relatively
having a final image of the employee since this is based on recent actions and events.

Of course, since many of the reviewers find difficulties to remember all the facts relating
to each employee throughout the assessment period, a calendar of critical events could be
a very useful and supportive tool or ingredient for the other assessment methods.

This method was used in this Microsoft Company case study in combination with the
rating scales method, mostly for qualitative jobs.

3. BALANCED SCORECARD: Specifically, the Balanced Scorecard allows or grant all

the managers to observe their business through the following four perspectives, providing
answers to four key essential questions and they are as follows:

 How our customers see us? (Customers’ perspective)

 Where should we be different? (Internal perspective)
 How can we continue to improve and create value? (Leadership and learning perspective)
 How do we appear to our stakeholders? (Economic perspective)

23
The Microsoft Company apply this method in this case study and they just collect the answers
regarding these four key questions or four perspective.

4. 360 DEGREE FEEDBACK: The method of 360th assessment is an appraisal form

where someone is appraised by assessors or evaluators from the different hierarchical
levels, departments and she/he even do self-assessment.

In the employee Performance Appraisals, the assessors or evaluators may be same rank
managers, subordinates, direct or dotted managers, business executives and even external
partners. In its 360th assessment, self-evaluation exists, and it shows the differences from
the appraisal of the others.

The results of the assessors or evaluators are grouped aiming at seeing what others think
on specific points of our performance in relation to what it is believed by the employee
and his/her supervisor.

It is a perfect and very organized way to have feedback on how others perceive the
employee’s behaviour.
The name “360” comes or arose out from the 360th degrees of the circle. The employee of the
company gets feedback anonymously evaluated or assessed by the immediate supervisor,
subordinates, same rank employees or other colleagues, customers and partners outside the
organization.

The 360th assessment is considered as the most crucial objective method for appraising the
performance of employees. An unusual number of assessors or evaluators as per employee is
from 8 to 15 people.

5. FIELD REVIEW METHOD: Under this method, the specialized executive visits the
workplace and assists or help supervisors in the Performance Appraisal process. The
executive derives or obtain information about the employee’s performance, she/he
processes them, and then she/he ends up with the appraisal of each employees.

24
 Furthermore, the appraisal report is sent to the supervisor, who makes changes or alter,
comments or notes as accepts it as it is and then communicates it to the employee. 

The advantages of this method are the formality of the process, greater objectivity and
credibility of results since the personal element of the supervisor is limited to a certain as
well as the uniformity in the assessment or evaluation of employee’s performance.

Although this method reduces the subjectivity of the immediate superior and exceeds
his/her potential weakness of not knowing how to assess an employee.

This method deals with some disadvantages and they are:

a. The control, power and the role of the supervisor are reduced.
b. This method requires an executive from the Human Resources department to know
multiple of the characteristics of the job for which she/he will assess the employee.
c. It takes longer and costs more.
d. It can bring into conflict or disputes the special assessor with the immediate
supervisor.

Since a lot of problems appeared in the past with the rating scales and critical incident method
for qualitative jobs, this method is used in combination with them to avoid supervisor’s
subjectivity.
CHAPTER-IV
CONCLUSION AND FINDINGS

CONCLUSION:

The Business Companies need to remain competitive to survive in the era of free market and
globalization. So, to remain competitive they need a continuous development and growth of their
human resources. So, the best dynamic mechanism for development is the Performance
Appraisal. The Appraisal must be comprehensive and continuous. Performance Appraisal
basically meant a system of reviewing and assessing or evaluating the job performance of an
individual or a group. However, most of the companies focus on the Performance Appraisal

25
system of each employee whereas the Performance of the employee team should also be
evaluated.

The management also demanded their workers to provide explanations especially with regard to
their actions related to their responsibilities. Everybody received positive and negative
feedbacks, and even those employees who were performing well were asked not to celebrate but
to bring their efforts to even higher levels. Those underperforming employees were being
threatened to be expelled from the company if their performances and outputs did not improve
within a certain period.

ADVERSE EFFECTS:

 In order to find immediate or fast replacement for the terminated Black, Americans,
Microsoft recruited contractual workers, but they too were not able to perform their
responsibilities according to the standards of the company.
 Many contractual workers did not even bother to finish their contracts out of their
disappointing experiences with Microsoft Company.
 An enjoyable and challenging place to work for eventually transformed into a frustrating,
pressure-packed office where the leaders were very eager to find the faults and weakness
of the employees.
 Brought down their morale and motivation to work hard, promoted backstabbing with
colleagues.
SOLUTION BY CEO STEVE BALLMER:

IMPROVING COMMUNICATION LINES.

IMPROVED PERFROMANCE APPRAISAL

AND COMPENSATION SYSTEM.

INCREASE IN EMPLOYEE BENEFITS.

NEW WORKPLACE SETUPS.

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 IMPROVED PERFORMANCE APPRAISAL AND COMPENSATION SYSTEM
 Change of the Performance Appraisal system from the forced ranking system towards
commitment rating.
 Problem with the forced ranking system was that it was a biased process of determining
the employees that are going to get the incentives for excellent performance.
 In the commitment rating, all employees of Microsoft will have equal opportunity to get
incentives particularly in the management of their stocks in the company depending on
their performance.
 Put to rest or end this issues and controversies regarding its unfair performance
evaluation process that even led to some Black American employees filing lawsuits
against Microsoft.

Change of the
performance
appraisal system
from the forced
ranking system

27
towards commitment
rating
Change of the
performance
appraisal system
from the forced
ranking system
towards commitment
rating
FINDINGS: The findings or suggestions which was arose out by the researcher after ending this
research project are as follows:

 Microsoft needs to focus more on their workers instead of thinking about their profits.

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 Microsoft must focus to try and reduce its perfectionist organizational culture to lessen
the pressure that is always being felt by their employees.
 Performance Appraisal needs to be more lenient and allow the workers to have room for
improvement and freedom.
 Microsoft needs to give or provide better benefits to their outstanding employees other
than stock options.
CHAPTER-V
BIBLIOGRAPHY / REFRENCES.

https://vdocuments.site/performance-appraisal-and-case-study-on-microsoft.html.
https://brauss.in/hrm-basic-notes.pdf.
https://www.tutorialspoint.com/human_resource_management/human_resource_manage
ment_introduction.htm#:~:text=Human%20Resource%20Management%20(HRM)
%20is,emphasizing%20on%20policies%20and%20systems.
https://www.slideshare.net/ManmohanDevathi/performance-appraisal-and-case-study-on-
microsoft.
https://www.ukessays.com/essays/business/performance-appraisal-of-the-microsoft-
corporation-business-essay.php.

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