A Study On Performance Appraisal System Followed in (Hero Motocorp)

A STUDY ON PERFORMANCE APPRAISAL SYSTEM
FOLLOWED IN SHIVAKAMAM MOTORS (HERO MOTOCORP)
INDEX
CHAPTER # TITLE PAGE #

1 INTRODUCTION 1
2 COMPANY PROFILE 8
3 OBJECTIVES OF THE STUDY 18
4 SCOPE OF THE STUDY 19
5 LIMITATIONS OF THE STUDY 20
6 RESEARCH METHODOLOGY 21
7 DATA ANALYSIS AND INTERPRETATION 28
8 FINDINGS 79
9 SUGGESTIONS 80
10 CONCLUSION 81
11 BIBLIOGRAPHY 82
12 ANNEXURE 83
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LIST OF TABLES
S.# PARTICULARS TABLE PG. #

1 RESPONDENTS ACCORDING TO THEIR GENDER 28
2 RESPONDENTS ACCORDING TO THEIR AGE GROUP 30
3 RESPONDENTS ACCORDING TO THEIR QUALIFICATION 32
4 RESPONDENTS ACCORDING TO THEIR DEPARTMENTS 34

5 RESPONDENTS ACCORDING TO THEIR EXPERIENCE 36
6 SELF RATING BY THE EMPLOYEES 38
7 PERFORMANCE APPRAISAL NECESSARY 40

8 CURENT APPRAISL SYSTEM IS GOOD 42
9 APPRAISAL HELPS IN IMPOROVING PERSONNEL SKILL 44
10 IMPROVES TEAM WORK AND CO-OPERATION IN THE 46

ORGANIZATION
11 IMPROVES EMPLOYEE MOTIVATION 38
12 HELPS IN IDENTIFYING THE TRAINING NEEDS 50

13 STRENGTHS AND WEAKNESS OF EMPLOYEES REVEALED 52
14 SALARY POST PROMOTION MUST BE BASED ON RATINGS 54
15 RATINGS HELP TO FIX INCREMENT 56

16 PROMOTION BASED ON PERFORMANCE APPRAISAL 58
17 APPRAISAL TIMING 60
18 APPRAISED DURING SERVICE PERIOD? 62
19 HELPS TO MAINTAIN GOOD COMMUNICATION BETWEEN 64
SUPERIORS AND SUBORDINATES
20 RESULTS OF POOR APPRAISAL SYSTEM 66
21 FEED BACK BY SUPERIORS POST APPRAISAL 68
22 COMPLAINT CHANNEL FOR EMPLOYEES DISATISFIED 70
WITH THE PERFORMANCE APPRAISAL
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LIST OF CHARTS
S.# PARTICULARS CHART PG. #

1 RESPONDENTS ACCORDING TO THEIR GENDER 29
2 RESPONDENTS ACCORDING TO THEIR AGE GROUP 31
3 RESPONDENTS ACCORDING TO THEIR QUALIFICATION 33
4 RESPONDENTS ACCORDING TO THEIR DEPARTMENTS 35
5 RESPONDENTS ACCORDING TO THEIR EXPERIENCE 37
6 SELF RATING BY THE EMPLOYEES 39
7 PERFORMANCE APPRAISAL NECESSARY 41
8 CURENT APPRAISL SYSTEM IS GOOD 43
9 APPRAISAL HELPS IN IMPOROVING PERSONNEL SKILL 45
10 IMPROVES TEAM WORK AND CO-OPERATION IN THE 47
ORGANIZATION
11 IMPROVES EMPLOYEE MOTIVATION 49
12 HELPS IN IDENTIFYING THE TRAINING NEEDS 51
13 STRENGTHS AND WEAKNESS OF EMPLOYEES REVEALED 53
14 SALARY POST PROMOTION MUST BE BASED ON RATINGS 55
15 RATINGS HELP TO FIX INCREMENT 57
16 PROMOTION BASED ON PERFORMANCE APPRAISAL 59
17 APPRAISAL TIMING 61
18 APPRAISED DURING SERVICE PERIOD? 63
19 HELPS TO MAINTAIN GOOD COMMUNICATION BETWEEN 65
SUPERIORS AND SUBORDINATES
20 RESULTS OF POOR APPRAISAL SYSTEM 67
21 FEED BACK BY SUPERIORS POST APPRAISAL 69
22 COMPLAINT CHANNEL FOR EMPLOYEES DISATISFIED 71
WITH THE PERFORMANCE APPRAISAL
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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 a part of guiding and managing career development. The latest
mantra being followed by organizations across the world being “get paid according to what you
contribute” the focus of the organizations is turning to performance management and specifically
to individual performance. During appraisal, past performance is evaluated and the roadmap for
the coming months is prepared. Be Ones roadmap for the coming months is being decided, for this
could very well define future and all the leaps one might make in professional life!
Appraisal cycles vary from organization to organization. Most have six-monthly or annual
reviews. Some also follow the process of a project-end review along with the usual organization
review cycle of six months or a year. However, the important thing is that appraisals are as much
about future performance as they are about ones past performance.
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DEFINTION AND CONCEPT
Performance appraisal is a formal, structured system of measuring and evaluating an

employee’s job related behaviors 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, organization, and society all benefit.
Performance appraisal is a systematic way of reviewing and assessing the performance of

an employee during a given period of time and planning the future. It is a powerful tool to
calibrate, redefine and reward the performance of the employee. It helps to analyze achievements
and evaluate the contribution towards the achievements of the overall organizational goals.
A performance appraisal is a method by which the job performance of an employee is

evaluated typically by the corresponding manager or supervisor. A performance appraisal is a part
of guiding and managing career development. It is the process of obtaining, analyzing, and
recording information about the relative worth of an employee to the organization. Performance
appraisal is an analysis of an employee's recent successes and failures, personal strengths and
weaknesses, and suitability for promotion or further training. It is also the judgment of an
employee's performance in a job based on considerations other than productivity alone.
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OBJECTIVES OF PERFORMANCE APPRAISAL
 To maintain records in order to determine compensation packages, wage structure, salaries

raises, etc.
 To let the employees know where they stand insofar as their performance is concerned and
to assist them with constructive criticism and guidance for the purpose of their
development.
 Deciding future goals and course of action regarding promotions, demotions and transfers.
 To identify the strengths and weaknesses of employees to place right men on right job.
 To adjudge the gap between the actual and the desired performance.
 It serves as a basis for influencing working habits of the employees.
 To help the management in exercising organizational control.
 To assess the training and development need of employees.

 To decide upon a pay raise.
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PRE – REQUISITES FOR EFFECTIVE & SUCCESSFUL PERFORMANCE APPRAISAL
The essentials of an effective performance system are:
 DOCUMENTATION
It refers to continuous noting and documenting the performance. It also helps the
evaluators to give a proof and the basis of their ratings.
 STANDARDS / GOALS
It denotes the standards set should be clear, easy to understand, achievable, motivating,
time bound and measurable.
 PRACTICAL AND SIMPLE FORMAT
The appraisal format should be simple, clear, fair and objective. Long and complicated
formats are time consuming, difficult to understand, and do not elicit much useful information.
 EVALUATION TECHNIQUE
An appropriate evaluation technique should be selected; the appraisal system should be

performance based and uniform. The criteria for evaluation should be based on observable and
measurable characteristics of the behavior of the employee.
 COMMUNICATION
Communication is an indispensable part of the Performance appraisal process. The

desired behavior or the expected results should be communicated to the employees as well as
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the evaluators. Communication also plays an important role in the review or feedback meeting.
Open communication system motivates the employees to actively participate in the appraisal
process.
 FEEDBACK
The purpose of the feedback should be developmental rather than judgmental. To

maintain its utility, timely feedback should be provided to the employees and the manner of
giving feedback should be such that it should have a motivating effect on the employees’ future
performance.
 PERSONAL BIAS
Interpersonal relationships can influence the evaluation and the decisions in the
performance appraisal process. Therefore, the evaluators should be trained to carry out the
processes of appraisals without personal bias and effectively.
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BENEFITS OF PERFORMACE APPRAISAL
For the appraisee:
 Increased motivation and job satisfaction.

 Clear understanding of what is expected and what needs to be done.
 Opportunity to discuss training needed to fulfill aspirations.
 Improved working relationships with the superior.
 Opportunity to overcome the weaknesses by guidance from the superior.
 Increased sense of personal value.
For the appraiser:
 Opportunity to clarify expectations that the manager has from teams and individuals.
 Opportunity to identify strengths and weaknesses of appraisees.
 Opportunity to develop an overview of individual jobs.
 Due to all above increased sense of personal value.
 Opportunity to re-prioritize targets.
 Opportunity to link team and individual objectives with department & organizational
objectives.
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For the company:
 Managers are better equipped to use their leadership skills and to develop their staff.
 Improved overview of tasks performed by each member of a group.
 Creation and maintenance of a culture of continuous improvement.
 Communication to people that they are valued.
 Increases sense of cohesiveness and loyalty.
METHODS OF PERFORMANCE APPRAISAL
Performance Appraisal systems can be classified as Modern Methods and Traditional

Methods.
MODERN METHODPERFORMANCE TRADITIONAL METHOD

APPRAISAL
Assessment Center Method Essay appraisal method
Behaviorally Anchored Rating Scale Straight Ranking method
Human Resource Accounting Paired comparison
360-Degree-Performance-Appraisal Critical incidents Methods
Management By Objectives Field review
Checklist method
Graphic rating scale
Forced distribution
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INDUSTRY PROFILE
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PRIMARY OBJECTIVES
 To study the effectiveness of Performance Appraisal system followed in Shivakamam

Motors (Hero Motocorp).
SECONDARY OBJECTIVES
 To observe the work environment in organization.

 To identify employee attitude towards appraisal system.
 To reduce the grievances of the employees.
 Provide information to assist in the other personal decisions in the organization.
 To provide suggestions and recommendations in improving the appraisal system.
Shivakamam Motors (Hero Motocorp)
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The scope of the study is vital and not only the Human Resource Department can reap the
benefits but also the Marketing and Sales Departments can make use of the findings from this
study.
Even though the time period was short respondents are covered to acquire greater
information.
The aim of choosing this topic is to help the organization in terms of betterment of their
already high standards and quality. The scope of study under the mentioned points depicts the
same.
 The programme will help the organization in meeting its future needs.
 This programme will help the employees of the organization in improving their personal
skills and knowledge.
 Employees will be motivated and will work with a friendly competition and this will make
the organization taste success at the earliest
.
 The appraiser gets an opportunity to identify strengths and weaknesses of appraisees.
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However I tried my level best in collecting the data relevant for this report, I faced few difficulties
in obtaining them. The prime difficulties I faced are:-
 The time duration of carrying out this project was short, leaving many doors unopened.
 Due to time constrain the process of carrying out the survey was not possible at large
levels.
 Even though the organization is densely populated I was able to cover only a handful of
employees to represent the whole.
 At the time of data collection the respondents were reluctant in filling the questionnaires
feeling of wastage of time and disclosing their opinion.
 Employees felt like filling the questionnaire may leave them in jeopardy.
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Research refers search for knowledge. It is done in a systematic manner through scientific
analysis. A scientific study is always objective. Research can be described as a systematic and
organized effort to investigate a specific problem encountered in the work setting that needs a
solution. It comprises a series of steps designed and executed, with a goal of finding answers to the
issues that are of concern in the work environment.
DEFINITION
Research can be defined as an “organized, systematic, data-based, critical, objective,

scientific inquiry or investigation into a specific problem, undertaken with the purpose of finding
answers or solutions to it”.
RESEARCH DESIGN
The research should be designed in such a way that the requisite data can be gathered and
analyzed to arrive at a solution. Studies may be either exploratory in nature or descriptive, or may
be conducted through testing hypothesis. The more sophisticated and rigorous the research design
is the greater the time, costs and other resources will be expended on the study.
 DESCRIPTIVE RESEARCH
The type of research used in this study is the Descriptive Research, which serves
the purpose to the fullest extent since the whole portion of the study was focusing on the
performance of various mutual fund schemes in the market.
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Descriptive research studies are those, which are concerned with describing the
characteristics of a particular individual, or of a group. The major purpose of this research is the
description of state of affairs, as it exists at the present. The researcher has no control over the
variables and mostly seeks to measure items such as preferences of people, impression of
employees about the organization, frequency of shopping etc.
DATA SOURCES
PRIMARY DATA SOURCE
Primary data is employed to collect the data from the respondents and the data are collected
with the help of questionnaires.
Questionnaire is a standardized from for collecting information to elicit desired data from
the respondents. A questionnaire consists of a set of questions presented to a responded for his or
her answers.
The questionnaire prepared in this study was mainly aimed at personal interview and was
contained open, multi-choice questions, dichotomous questions and also checklists.
DESIGN OF QUESTIONNAIRE
The structured questionnaire that is circulated to the employees has the following type of
questions:
 CLOSED END QUESTIONS: This type of questions will have only two choices “Yes” or
“No”. The respondents have to select any one of them.
 MULTIPLE CHOICES QUESTIONS: This type of questions will have more choices.
The respondents have to select any one of them.
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SAMPLING PLAN
POPULATION
The members working in Shivakamam Motors (Hero Motocorp). comprise the

population for this study.
SAMPLE PROCEDURE
Sampling is that part of statistical practice concerned with the selection of individual
observations intended to yield some knowledge about a population of concern, especially for the
purposes of statistical inference. Each observation measures one or more properties of an
observable entity enumerated to distinguish objects or individuals. Survey weights often need to be
applied to the data to adjust for the sample design. Results from probability theory and statistical
theory are employed to guide practice.
The sampling process comprises several stages:
 Defining the population of concern

 Specifying a sampling frame, a set of items or events possible to measure
 Specifying a sampling method for selecting items or events from the frame
 Determining the sample size
 Implementing the sampling plan
 Sampling and data collecting
 Reviewing the sampling process
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Sampling methods are classified as probability or non probability.
Probability methods include:
 Random Sampling
 Systematic Sampling
 Stratified Sampling
The advantage of probability sampling is that error can be calculated. Sampling error is the
degree of which a sample might differ from the population. When inferring the population, results
are reported plus or minus the sampling error.
Non probability includes:

 Convenience Sampling
 Judgment Sampling
 Quota Sampling
 Snow Ball Sampling
In non probability sampling members are selected from population in some non random
manner. In this sampling method the degree to which the sample differs from population remains
unknown.
Non probability sampling method is used in this project. In non probability sampling
method, Convenience sampling technique is made use of. Non probability method is often used
during preliminary research efforts to get a gross estimate of the results, without incurring the cost
or time required to select a random sample.
SAMPLE SIZE
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For this study 120 members are taken into account. Separate questionnaire was given to
each of them. Hence it will be easy for assessing the feedback from them.
STASTICAL TOOLS AND METHOD USED FOR DATA ANALYSIS
Statistical tools that are used to obtain findings and arrange information in a sequence from
the raw data collected.
Statistical Methods Used:

 Percentage Analysis
 Pie Charts
 Bar Chart
Statistical Tools Used:
 Chi-square test
 Rank Correlation
 Confidence Interval
 PERCENTAGE ANALYSIS:
As the data presented is large in number it was not easy to compare and interpret the data.
To make interpretation easy, percentage analysis is used. The following formula is used to do
the analysis.
Percentage = (No. of respondents / Total respondents) x 100
 HYPOTHESIS TESTING:
For testing the hypothesis Chi – Square (2) test of independence of attribute at 5% level
of significance is used. Chi- square test is a statical measure used in context of sampling
analysis for comparing a variance to a theoretical variance. By comparing the calculated value
with the table value of Chi-square for (n -1), n being the number of items in the sample, degrees
of freedom at 5% level of significance. If calculated value of 2 is less than table value, the null
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hypothesis is accepted, but if calculated value is equal or greater than table value, the hypothesis
is rejected.
2 = (O-E)2
________________
 RANK CORRELATION:
The Karl Pearson’s formula for calculating r is developed on the assumption that the values
of the variables are exactly measureable. In some situations it may not be possible to give
precise values for the variables. In such cases we can use another measure of correlation
coefficient called rank correlation coefficient.
6 D2
___________
r=1 -
n (n2-1)
Where D= x-y, the difference between ranks of corresponding pairs of x and y.

n is the no of observations.
If two or more observations have the same rank we assign them the mean rank, in that case the
formula will be
6[dxy2 +m (m2-1)]

___________________________________
r=1 -
n (n2-1)
Where m stands for the number of times a rank is repeated.
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 CONFIDENCE INTERVAL:
A confidence interval gives an estimated range of values which is likely to include an

unknown population parameter, the estimated range being calculated from a given set of sample
data. If independent samples are taken repeatedly from the same population, and a confidence
interval calculated for each sample, then a certain percentage of the intervals will include the
unknown population parameter. Confidence intervals are usually calculated so that the output is
95%, but we can produce 90%, 99%, 99.9% (desired) confidence intervals for the unknown
parameter.
CI = p ± [SE x Z value at 99% CI]
Let p be the assumed accuracy of the system to be tested, Z be the function test’s level of
confidence, SE is standard error of p.
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TABLE 1
RESPONDENTS ACCORDING TO THEIR GENDER
S.# Gender # of Respondents % of Respondents

1 Male 111 93
2 Female 9 7
3 Total 120 100
INFERENCE
From the above table it is observed that 93% of the employees are men and the rest are
women. The major population comprises of men.
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CHART 1
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TABLE 2
RESPONDENTS ACCORDING TO THEIR AGE GROUP
S.# Age Groups # of Respondents % of Respondents

1 Below 20 years 0 0
2 21 – 30 years 78 65
3 31 – 40 years 36 30
5 Above 40 years 6 5
6 Total 120 100
INFERENCE
It is observed that 65% of the population is in and around the age of 21 - 30 and 30% of the
population in and around the age of 31- 40 and 5% above 40.
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CHART 2
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TABLE 3
RESPONDENTS ACCORDING TO THEIR QUALIFICATION
S.# Qualification Level # of Respondents % of Respondents

1 SSLC 0 0
2 HSC 3 2
3 Diploma 30 25
5 Graduate 33 28
6 PG 54 45
7 Total 120 100
INFERENCE
From the table it is observed that 45% of the employees are Post Graduates, 28% are
Graduates, 25% are Diploma holders and the rest being Higher Secondary respectively.
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CHART 3
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TABLE 4
RESPONDENTS ACCORDING TO THEIR DEPARTMENTS
S.# Departments # of Respondents % of Respondents

1 Production 3 2
2 HR 21 18
3 R&D 0 0
5 Accounts 9 8
6 Others 87 72
7 Total 120 100
INFERENCE
From the above table it is observed that 18% of the population represents the
Human Resource Department, 8% from accounts department, 2% from production department and
a mixture of other departments comprise of 72% correspondingly.
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CHART 4
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TABLE 5
RESPONDENTS ACCORDING TO THEIR EXPERIENCE
S.# Experience # of Respondents % of Respondents

1 1 - 5 years 78 65
2 5 - 10 years 33 28
3 10 -15 years 9 7
5 Above 15 years 0 0
6 Total 120 100
INFERENCE
From the above table it is observed 65% of the respondents are experienced about
1 – 5 years, 28% of them are experienced about 5 – 10 years and the balance 7% about 10 – 15
years. No experienced people above 15 years.
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CHART 5
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TABLE 6
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SELF RATING BY THE EMPLOYEES
High Moderate Low

S. # Factors
# % # % # %
1 Quality of work 90 75 30 25 0 0
2 Co operation 99 83 18 15 3 2
3 Attendance 105 87 15 13 0 0
4 Communication Skill 66 55 54 45 0 0
INFERENCE
From the above table it is observed that employees believe their Quality of Work is high
about 75% and moderate about 25%. Co operation level is high up to 83% and moderate about
15%. Attendance is 88% high and 13% moderate finally communication skill level being 55% and
45% moderate.
CHART 6
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TABLE 7
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PERFORMANCE APPRAISAL NECESSARY
S.# Age Groups # of Respondents % of Respondents

1 Strongly Agree 54 45
2 Agree 63 53
3 Strongly Disagree 0 0
5 Disagree 3 2
6 Neither agree nor disagree 0 0
7 Total 120 100
INFERENCE
From the above table it is observed that 53% feel performance appraisal system is
necessary for the organization, 45% feel performance appraisal system is must for the
organization, 2% feel performance appraisal system is not important.
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CHART 7
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TABLE 8
CURENT APPRAISL SYSTEM IS GOOD
S.# Options # of Respondents % of Respondents

2 Agree 93 78
5 Disagree 12 10
7 Total 120 100
INFERENCE
From the above table it is observed that 78% feel current appraisal system is good, 10%
feel appraisal system is best that is followed in the organization, 10% disagree and 2% neither
agree nor disagree.
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CHART 8
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TABLE 9
APPRAISAL HELPS IN IMPOROVING PERSONNEL SKILL

2 Agree 75 63
5 Disagree 6 5
7 Total 120 100
INFERENCE
From the above table 63% of them feel performance appraisal improves personnel skills
and 27 % of them strongly feel that appraisal system improves personnel skill and 5% of them
disagree and the rest neither agrees nor disagrees.
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CHART 9
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TABLE 10
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IMPROVES TEAM WORK AND CO-OPERATION IN THE ORGANIZATION

2 Agree 78 65
5 Disagree 6 5
7 Total 120 100
INFERENCE
From the above table 65% of them feel that appraisal improves team work and
co-operation, 23% strongly feel it does, 5% disagree and 7% neither agree nor disagree.
CHART 10
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TABLE 11
IMPROVES EMPLOYEE MOTIVATION

2 Agree 81 68
5 Disagree 9 7
7 Total 120 100
INFERENCE
From the above table it is evident that 68% of them feel performance appraisal improves
employee motivation, 23% strongly feel appraisal only motivates employees, 7% feel there is no
relation between appraisal and Motivation and 2% neither agree nor disagree.
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CHART 11
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TABLE 12
HELPS IN IDENTIFYING THE TRAINING NEEDS

2 Agree 78 65
5 Disagree 3 2
7 Total 120 100
INFERENCE
From the above table it is evident that 65% of them feel performance appraisal identifies
employee training needs, 33% strongly feel performance appraisal identifies employee training
needs, and 2% feel there is no relationship between performance appraisal and training needs.
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CHART 12
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TABLE 13
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STRENGTHS AND WEAKNESS OF EMPLOYEES REVEALED

2 Agree 81 68
5 Disagree 3 2
7 Total 120 100
INFERENCE
From the above table it is evident that 68% of them feel performance appraisal identifies
employee strength and weakness, 28% strongly feel performance appraisal identifies employee
strength and weakness, and 2% feel there is no relationship between performance appraisal and
strengths and weakness of employees and 2% strongly feel that it is irrelevant.
CHART 13
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TABLE 14
SALARY POST PROMOTION MUST BE BASED ON RATINGS

2 Agree 90 75
5 Disagree 3 2
7 Total 120 100
INFERENCE
From the above table it is evident that 75% of them feel after performance appraisal salary
must be fixed, 18% strongly feel only after appraisal salary must be fixed, 5% strongly feel there is
no relationship between performance appraisal and salary and 2% feel there is no relationship
between them.
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CHART 14
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TABLE 15
RATINGS HELP TO FIX INCREMENT

2 Agree 96 80
5 Disagree 6 5
7 Total 120 100
INFERENCE
From the above table it is evident that 80% of them feel performance appraisal helps to fix
increment, 15% strongly feel performance appraisal helps to fix increment, and 5% feel there is no
relationship between performance appraisal and increment.
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CHART 15
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TABLE 16
PROMOTION BASED ON PERFORMANCE APPRAISAL

2 Agree 60 50
5 Disagree 30 25
7 Total 120 100
INFERENCE
From the above table it is evident that 50% of them feel promotion is based on appraisal,
20% strongly feel promotion is based on performance appraisal and 25% feel there is no
relationship between appraisal and promotion and 5% neither agree nor disagree.
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CHART 16
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TABLE 17
APPRAISAL TIMING

1 Half yearly 30 25
2 Quarterly 27 22
3 Yearly 63 53
4 Total 120 100
INFERENCE
From the above table it is evident that 53% of them feel appraisal should be done yearly
once, 25% feel appraisal should be scheduled half yearly and 22% feel appraisal must be done
quarterly.
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CHART 17
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TABLE 18
APPRAISED DURING SERVICE PERIOD?

1 Yes 96 80
2 No 24 20
3 Total 120 100
INFERENCE
From the above table it is evident that 80% of them are appraised during their service
period and 20% of them have not been appraised.
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CHART 18
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TABLE 19
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HELPS TO MAINTAIN GOOD COMMUNICATION BETWEEN SUPERIORS
AND SUBORDINATES

1 Yes 111 93
2 No 9 7
3 Total 120 100
INFERENCE
From the above table it is evident that 93% feel appraisal maintains good communication
and relationship between superiors and subordinates and 7% feel appraisal is not the key for good
communication and relationship between superiors and subordinates.
CHART 19
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TABLE 20
RESULTS OF POOR APPRAISAL SYSTEM

1 De-motivation 45 38
2 Conflicts 33 27
3 Ineffective Team Work 42 35
4 Total 120 100
INFERENCE
From the above table it is evident that 38% feel poor appraisal leads to de-motivation and
27% feel poor appraisal leads to conflicts and 35% feel it leads to ineffective team work.
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CHART 20
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TABLE 21
FEED BACK BY SUPERIORS POST APPRAISAL

1 Complimentary 24 20
2 Suggestive 84 70
3 Negative 9 8
4 Warning 3 2
5 Total 120 100
INFERENCE
From the above table it is evident that 70% feel appraisal feedback by superiors is
suggestive 20% strongly feel appraisal feedback by superiors is complimentary, 8% feel appraisal
feedback by superiors is negative and 2% feel appraisal feedback by superiors is given in warning.
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CHART 21
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TABLE 22
COMPLAINT CHANNEL FOR EMPLOYEES DIS-SATISFIED WITH THE

PERFORMANCE APPRAISAL

1 Yes 84 70
2 No 36 30
3 Total 120 100
INFERENCE
From the above table it is evident that 70% feel there must be a separate channel for
employees who are dissatisfied with appraisal and 30% feel there is no need of such channels.
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CHART 22
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STATISTICAL TOOLS AND ANALYSIS
CHI- SQUARE TEST I – (ψ2)
Chi-square is the sum of the squared difference observed (o) and the expected (e) data (or
the deviation, d), divided by the expected data in all possible categories.
Null hypothesis (Ho):
There is a relationship between respondents according to their age group and

respondents according to their qualification.
Alternate hypothesis (H1):
There is no relationship between respondents according to their age group and

respondents according to their qualification.
Case Processing Summary
Cases
Valid Missing Total
N Percent N Percent N Percent
RESPONDENTS
ACCORDING TO THEIR
AGE GROUP *
120 100.0% 0 0.0% 120 100.0%
RESPONDENTS
ACCORDING TO THEIR
QUALIFICATION
RESPONDENTS ACCORDING TO THEIR AGE GROUP * RESPONDENTS ACCORDING TO THEIR QUALIFICATION

Crosstabulation
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RESPONDENTS ACCORDING TO THEIR Total
QUALIFICATION
HSC Diploma Graduate PG
Count 3 30 33 12 78
% within
RESPONDENTS
3.8% 38.5% 42.3% 15.4% 100.0%
ACCORDING TO
THEIR AGE GROUP
21 – 30
% within
years
RESPONDENTS
ACCORDING TO 100.0% 100.0% 100.0% 22.2% 65.0%
THEIR
QUALIFICATION
% of Total 2.5% 25.0% 27.5% 10.0% 65.0%
Count 0 0 0 36 36
% within
RESPONDENTS
0.0% 0.0% 0.0% 100.0% 100.0%
ACCORDING TO
RESPONDENTS THEIR AGE GROUP
31 – 40
ACCORDING TO % within
years
THEIR AGE GROUP RESPONDENTS
ACCORDING TO 0.0% 0.0% 0.0% 66.7% 30.0%
THEIR
QUALIFICATION
% of Total 0.0% 0.0% 0.0% 30.0% 30.0%
Count 0 0 0 6 6
% within
RESPONDENTS
0.0% 0.0% 0.0% 100.0% 100.0%
ACCORDING TO
THEIR AGE GROUP
Above 40
% within
years
RESPONDENTS
ACCORDING TO 0.0% 0.0% 0.0% 11.1% 5.0%
THEIR
QUALIFICATION
% of Total 0.0% 0.0% 0.0% 5.0% 5.0%

Total Count 3 30 33 54 120
1
% within
RESPONDENTS
2.5% 25.0% 27.5% 45.0% 100.0%
ACCORDING TO
THEIR AGE GROUP
% within
RESPONDENTS
ACCORDING TO 100.0% 100.0% 100.0% 100.0% 100.0%
THEIR
QUALIFICATION
% of Total 2.5% 25.0% 27.5% 45.0% 100.0%
Chi-Square Tests
Value df Asymp. Sig. (2-

sided)
a
Pearson Chi-Square 78.974 6 .000
Likelihood Ratio 98.179 6 .000
Linear-by-Linear Association 52.039 1 .000
N of Valid Cases 120
a. 6 cells (50.0%) have expected count less than 5. The minimum

expected count is .15.
1
Degree of Freedom= (r-1) *(c-1)
= 2*3= 6
Calculated value = 78.974
Tabulated value = 12.59
Z = Z cal >Z tab Z= 78.974>12.59
Hence, the Alternate hypothesis [H1] is accepted
INFERENCE:
Since the calculated value is greater than the tabulated value, we accept the
alternate hypothesis and hence there is no relationship between respondents according to their age
group and respondents according to their qualification.
ONE-WAY ANOVA CLASSIFICATION
1
Null hypothesis (Ho):
There is a significance difference between respondents according to their experience

and performance appraisal necessary.
There is no significance difference between respondents according to their

experience and performance appraisal necessary.
Descriptives
N Mean Std. Deviation Std. Error 95% Confidence Interval for Minimum Maximum
Mean
Lower Bound Upper Bound
Strongly Agree 54 1.00 .000 .000 1.00 1.00 1 1

Agree 63 1.71 .633 .080 1.55 1.87 1 3
Disagree 3 3.00 .000 .000 3.00 3.00 3 3
Total 120 1.43 .631 .058 1.31 1.54 1 3
Test of Homogeneity of Variances

RESPONDENTS ACCORDING TO THEIR
EXPERIENCE
Levene Statistic df1 df2 Sig.
83.650 2 117 .000
ANOVA
Sum of Squares df Mean Square F Sig.
Between Groups 22.468 2 11.234 52.877 .000

Within Groups 24.857 117 .212
Total 47.325 119
1
C
alculated value = 52.877
Tabulated value = 3.09
F = F cal >F tab F=52.877> 3.09
Hence, the Alternate hypothesis [H1] is accepted.
INFERENCE:
The calculated value of F is greater than the tabulated value. Hence, we reject the null
hypothesis and conclude that there is no significance difference between respondents according to
their experience and performance appraisal necessary.
ANALYSIS USING KARL PEARSON’S CORRELATION
1
Correlation analysis is the statistical tool used to measure the degree to which two variables are
linearly related to each other. Correlation measures the degree of association between two
variables.
Null hypothesis (H0):
There is positive relationship between improves team work and co-operation in the
organization and improves employee motivation.
There is negative relationship between improves team work and co-

operation in the organization and improves employee motivation.
Correlations
IMPROVES TEAM IMPROVES

WORK AND CO- EMPLOYEE
OPERATION IN MOTIVATION
THE
ORGANIZATION
IMPROVES TEAM WORK AND Pearson Correlation 1 .940**
CO-OPERATION IN THE Sig. (2-tailed) .000

ORGANIZATION N 120 120
**
Pearson Correlation .940 1
IMPROVES EMPLOYEE
Sig. (2-tailed) .000
MOTIVATION
N 120 120
**. Correlation is significant at the 0.01 level (2-tailed).
r= .940
INFERENCE:
Since r is positive, there is positive relationship between improves team work and co-
operation in the organization and improves employee motivation.
1
1
 Out of the total sample 93% of them are male.
 Most of them are in and around 21 – 30 years of age.
 45% of the sample size is Post Graduates.
 More than half of the sample size is experienced around 1-5 years and 30% of them
ranging from 5 – 10 years.
 The employees are riding high in their self confidence level.

 98% of employees feel that performance appraisal is necessary for an organization.
 88% of the sample size feels that the current appraisal system followed in the organization
is good.
 All respondents feel appraisal helps in improving personnel skill.

 The respondents strongly agree that appraisal improves team work and co-operation.
 90% of the sample size feels that performance appraisal motivates the employees.
 All the respondents feel appraisal helps in identifying the training needs of the employees.
 All the respondents feel that appraisal reveals strengths and weakness of the employees.
 Most of the respondents feel that salary must be based on ratings post promotion.
 95% of the respondents feel that appraisal ratings help to fix increment.
 More than half of the respondents say promotion must be based on appraisal.
 Employees feel appraisal must be done yearly once.
 80% of the employees are appraised during period of service.
 Appraisal helps to maintain good communication between superior and subordinate.
 Results of poor appraisal system would lead to de-motivation feel the respondents.
 Superiors are suggestive in feedback post appraisal.
 70% of them feel there is a need for complaint channel for employees dissatisfied with
appraisal.
1
1
 A separate channel for appraisal review and evaluation can be maintained.
 Senior employees can give counseling to the newly employed ones.
 Career growth chart of employees can be given to them so that self improvement is
possible.
 93% of the respondents agree that appraisal system has provided a good communication
between top management and staff. The management should continue to retain this stage
which will lead to team work and thereby improve the productivity.
 Regarding the timing of appraisals majority of the respondents opted for yearly, few of
them opted for quarterly and half yearly. From this it is evident that employees are very
much interested in increasing the frequency of appraisal.
1
1
It is true as they say completion of one work leads to another, there is no end for any working
process and one among those kinds of jobs is Performance Appraisal. Performance Appraisal is a
never ending process, it is essential for personal and professional development.
This report is compiled in a very precise manner and has all relevant data gathered from the
organization, company website and few other supporting sites.
I would like to state this very strongly in my report that to Shivakamam Motors (Hero
Motocorp)., its employees are the most valuable assets and are solely responsible for its sustained
growth and development of the organization. They give their best class in all the fields they have
taken up and are delivering the best to their customers.
I conclude that performance appraisal is a very important tool that is used to keep the
energy levels of the employees charged up. It encourages the employees and makes them to give
their best shot and helps in building the future for the organization.
Performance reviews not only speak of the past performance, also are the pavement for the future
performances.
1
1
 http://www.managementstudyguide.com/performance-appraisal.htm
 http://www.answerbag.com/q_view/1969680
 http://wiki.answers.com/Q/What_is_meaning_of_performance_appraisal
 http://www.humanresources.hrvinet.com/benefits-of-performance-appraisal/
 http://www.citehr.com/
 http://www.managementparadise.com/
 http://www.performance-appraisal.com/methods.htm
 http://hrmba.blogspot.com/
 http://en.wikipedia.org/wiki/Performance_appraisal
1
1
A study on Performance Appraisal systems followed in Shivakamam Motors (Hero
Motocorp). The data that is collected will be kept confidential.
QUESTIONNAIRE
SOCIO – DEMOGRAPHIC FACTORS
 Name:
 Sex:
Male Female
 Age:
Below 20 years 20 – 30 years 30 – 40 years Above 40 years
 Marital status:
Married Unmarried
 Educational qualification:
SSLC HSC Diploma Graduate PG
 Department:
Production HR R&D Accounts Others
In case of others please specify …………………………
 Monthly Income: (in Rs.)
Below 10K 10K -15K 15K – 20K Above 20K
1
STUDY FACTORS
1. How long have you been associated with this organization?
1-5 Years 5-10 years 10–15 years Above 15 years
2. How will you rate your performance on the following criteria?
FACTORS HIGH MODERATE LOW

Quality of work
Co operation
Attendance
Communication Skill
3. Performance appraisal system is needed for an organization

Strongly agree Agree Disagree
Strongly Disagree Neither agree nor disagree
4. Current performance appraisal system is doing good

5. Performance Appraisal is helpful in improving the personnel skill?

6. Performance appraisal helps to win co-operation and team work in the organization?

7. Performance appraisal improves employee motivation?
8. Performance appraisal report is helpful in identifying the training needs?
1
9. The performance appraisal system helps to identify the strength and weakness of the
employee.

10. Management must fix salary through the performance rating after promotion.

11. Performance rating helps to fix increment.

12. Promotion is purely based on performance appraisal?

13. Appraisal in your organization should be done every?
Half Yearly Quarterly Yearly
14. Have you ever been appraised during your service period?
Yes No
15. Does the appraisal system provide a good communication between the top-management
plans and business goals to staff below?
Yes No
16. What do you think is the effect of a poor appraisal system?
De-motivation Conflicts Ineffective teamwork
1
17. How is the feedback on your performance given by your superiors?
Complimentary Suggestive Negative Warning
18. Do you wish to have a complaint channel for employees who are dissatisfied with the
performance appraisal?
Yes No
Your valuable suggestions are welcome ……………………..........……………………..
Thank You for your time & kind co-operation

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A STUDY ON PERFORMANCE APPRAISAL SYSTEM

FOLLOWED IN SHIVAKAMAM MOTORS (HERO MOTOCORP)

CHAPTER # TITLE PAGE #

3 OBJECTIVES OF THE STUDY 18

4 SCOPE OF THE STUDY 19

5 LIMITATIONS OF THE STUDY 20

7 DATA ANALYSIS AND INTERPRETATION 28

S.# PARTICULARS TABLE PG. #

3 RESPONDENTS ACCORDING TO THEIR QUALIFICATION 32

4 RESPONDENTS ACCORDING TO THEIR DEPARTMENTS 34

7 PERFORMANCE APPRAISAL NECESSARY 40

10 IMPROVES TEAM WORK AND CO-OPERATION IN THE 46

12 HELPS IN IDENTIFYING THE TRAINING NEEDS 50

15 RATINGS HELP TO FIX INCREMENT 56

S.# PARTICULARS CHART PG. #

Performance appraisal is a formal, structured system of measuring and evaluating an

Performance appraisal is a systematic way of reviewing and assessing the performance of

A performance appraisal is a method by which the job performance of an employee is

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

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

 To help the management in exercising organizational control.

 To assess the training and development need of employees.

The essentials of an effective performance system are:

 PRACTICAL AND SIMPLE FORMAT

An appropriate evaluation technique should be selected; the appraisal system should be

Communication is an indispensable part of the Performance appraisal process. The

The purpose of the feedback should be developmental rather than judgmental. To

For the appraisee:

 Increased motivation and job satisfaction.

 Opportunity to discuss training needed to fulfill aspirations.

 Improved working relationships with the superior.

 Opportunity to overcome the weaknesses by guidance from the superior.

 Increased sense of personal value.

For the appraiser:

 Opportunity to develop an overview of individual jobs.

 Due to all above increased sense of personal value.

 Opportunity to re-prioritize targets.

 Creation and maintenance of a culture of continuous improvement.

 Communication to people that they are valued.

 Increases sense of cohesiveness and loyalty.

METHODS OF PERFORMANCE APPRAISAL

Performance Appraisal systems can be classified as Modern Methods and Traditional

MODERN METHODPERFORMANCE TRADITIONAL METHOD

Assessment Center Method Essay appraisal method

Behaviorally Anchored Rating Scale Straight Ranking method

Human Resource Accounting Paired comparison

360-Degree-Performance-Appraisal Critical incidents Methods

Management By Objectives Field review

Graphic rating scale

 To study the effectiveness of Performance Appraisal system followed in Shivakamam

 To observe the work environment in organization.

Shivakamam Motors (Hero Motocorp)

Research can be defined as an “organized, systematic, data-based, critical, objective,

PRIMARY DATA SOURCE

The members working in Shivakamam Motors (Hero Motocorp). comprise the

The sampling process comprises several stages:

 Defining the population of concern

Probability methods include:

Non probability includes:

STASTICAL TOOLS AND METHOD USED FOR DATA ANALYSIS

Statistical Methods Used:

Percentage = (No. of respondents / Total respondents) x 100