Employees Satisfaction With The Perform

“Employees’ Satisfaction with the Performance Appraisal System in NIC
Asia Bank”
Submitted By:
Sushovit Sainju
Exam Roll No.: 14728/14
TU Regd. No: 7-2-39-1773-2014
A Summer Project Report Submitted to

Faculty of Management, Tribhuvan university
in partial fulfillment of the requirements for the degree of
Bachelor of Business Administration (BBA)
at the
Shanker Dev Campus
Tribhuvan university
Putalishadak, Kathmandu
April, 2018
DECLARATION
This is to certify that I have completed the Summer Project entitled "Employees’
Satisfaction with the Performance Appraisal System in NIC Asia Bank" under the
guidance of "Associate Prof. Achyut Raj Bhattarai and Mr. Jhabindra Pokharel" in a partial
fulfillment of the requirements for the degree of Bachelor of Business Administration at
Faculty of Management, Tribhuvan University. This is my original work and I have not
submitted it earlier elsewhere.
Date:2018-04-07
Sushovit Sainju
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ACKNOWLEDGEMENTS
This study entitled‘Employees’ Satisfaction with the Performance Appraisal System in
NIC Asia Bank’has been prepared for partialfulfillment of Bachelor of
BusinessAdministration. It is directed towardsemployees’ satisfaction level on
performance appraisal system.
First of all, I would like to acknowledge Tribhuvan University, Shanker Dev Campus and
its policy making unit for providing this opportunity. I would like to thank a number of
people for their help while I completed this project report.
I would like to thank my supervisor, Associate Prof. Achyut Raj Bhattarai and Mr.
Jhabindra Pokharel, who was always there when I needed guidance and kept me on the
right track.
I wish to express my appreciation to my family as well as my friends for their valuable

suggestions and support. To my colleagues and respondents of my survey, who gave up
their time to help me complete my research paper.
And finally, to NIC Asia Bank, without their constant support and encouragement I would
never have completed this project, a sincere Thank-you.
Sushovit Sainju
BBA, 7th Semester
ABBREVIATIONS
PAS- Performance Appraisal System
PA- Performance Appraisal
NRB- Nepal Rastra Bank
CIDP- Chartered Institute of Professional Development
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TABLE OF CONTENTS
DECLARATION ii
ACKNOWLEDGEMENTS i
ABBREVIATIONS ii
LIST OF FIGURES v
LIST OF TABLES vi
EXECUTIVE SUMMARY viii
CHAPTER I: INTODUCTION 1
1.1 Context Information 1
1.2 Objectives of the Study 3
1.3 Significance of the Study 3
1.4 Literature Review 4
1.4.1 Theoretical Review 4
1.4.2 Empirical Review 9
1.4.3 Conceptual Framework and definition of variables 11
1.5 Research Methods used for Data Collection and Analysis 13
1.5.1. Research Design 13
1.5.2. Population and Sampling 14
1.5.3 Data Collection 14
1.5.4 Analytical Tool 15
1.6 Organization of the Study 16
1.7 Limitations of the Study 17
CHAPTER II: DATA PRESENTATION AND ANALYSIS 18
2.1 Data Presentation and Interpretation 18
2.1.1 Demographic profile of the respondents 18
2.1.2 Reliabiltiy Test 21
2.1.3 Variables profile and their interpretation 22
2.2 Pearson Correlation Analysis 39
2.3. Major Findings 40
CHAPTER III: CONCLUSION AND ACTION IMPLICATIONS 42
3.1. Conclusion 42
3.2. Action Implications 43
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REFERENCES
APPENDIX
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LIST OF FIGURES
List Title Page

No.
Figure 1. 1: The Appraisal Process 8
Figure 1. 2: Elements of appraisal effectiveness by Piggott-Irvine 11
Figure 1. 3: Conceptual Framework 12
Figure 2. 1:Gender of Respondents 18

Figure 2. 2: Age of Respondents 19
Figure 2. 3: Length of Service 19
Figure 2. 4: Effectiveness of Appraisal System 20
Figure 2. 5: Effective Commination of the Objectives 21
Figure 2. 6: Personal Development 37
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LIST OF TABLES
List Title Page

No.
Table 2. 1: Reliability test on Independent Variables 21
Table 2. 3: Willingness to participate in developing new appraisal system 22
Table 2. 4: Participation on development leads to better PA instrument 23
Table 2. 5: Performance evaluation with the help of employees 23
Table 2. 6: Employees participation leads to reliable and fair PA standards 23
Table 2. 7: Enhancement of employees’ participation for developing PA instrument 24
Table 2. 8: Descriptive analysis of employees participation 24
Table 2. 9: Defined task 25
Table 2. 10: Reachable target 26
Table 2. 11: Encouragement if target exceed 26
Table 2. 12: Descriptive analysis of job criteria 27
Table 2. 13: Feedback received 27
Table 2. 14: Feedback communication 27
Table 2. 15: Accurate feedback 28
Table 2. 16: Descriptive analysis of Feedback communication 28
Table 2. 17: Improves on-the-job performance 29
Table 2. 18: Receive timely feedback 30
Table 2. 19: Feedback accuracy 30
Table 2. 20: Detailed feedback 30
Table 2. 21: Feedback satisfaction 31
Table 2. 22: Discuss work related issues with supervisor 31
Table 2. 23: Ability of rater to use appraisal instrument appropriately 32
Table 2. 24: Descriptive analysis of Performance feedback 33
Table 2. 25: Raters skills in performance assessment 33
Table 2. 26: Training needed for conducting PA 34
Table 2. 27: Ability to use instrument as intended 35
Table 2. 28: Regular update of appraisal skills 35
Table 2. 29: Consistency of PA throughout the organization 35
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Table 2. 30: Descriptive analysis of Raters 36
Table 2. 31: Timely payment is needed 37
Table 2. 32: Satisfaction with pattern of training and development 38
Table 2. 33: Satisfaction with work 38
Table 2. 34: Job rotation satisfaction 39
Table 2. 35: Descriptive analysis of employees’ satisfaction 39
Table 2. 36: Correlation analysis of the variables 40
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EXECUTIVE SUMMARY
Performance appraisal is the part of career development of employees of an organization.
Performance appraisal is method of evaluating employees’ performance over a specific
time period. It is the review of employees against some pre-established criteria. It is a
process to appraise and judge the job performance of individual employee and
documenting the information in systematic way and reviewing it constantly to measure the
potential of employees. This system is important to employees as well as employers. This
system provides employees with the feedback that help them to know their strengths and
weaknesses.
The research work entitled “Employees’ Satisfaction with the Performance Appraisal
System in Commercial Banks” was concluded with the major objectives of identifying
factors influencing satisfaction level and evaluating fairness in present performance
appraisal practices as perceived by the employees. It also shows the effects and level of
dependent variable (employees satisfaction) with the independent variables (employees
participation, feedback communication, job criteria, performance feedback and raters). In
order to meet the objectives of the study quantitative data methodology was employed.
Descriptive statistics like mean and standard deviation is employed and correlation and
reliability analysis are performed to find the relationship and dependency of employees’
satisfaction on employees’ participation, feedback communication and job criteria. The
data were obtained from the employees working in NIC Asia Bank through questionnaire
distribution.
It was observed that there exists positive relation between employees’ satisfaction and
employees’ participation, feedback communication, job criteria, performance feedback and
raters. However, there was weak relationship between dependent variable and independent
variable. Mostly employees were satisfied with the feedback they received. They agreed
that appraisal system helped them to develop personally.
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CHAPTER I
INTODUCTION
1.1 Context Information
Performance appraisals are essential for effective evaluation and management of staff. In
today’s competitive business world, it is understood that organizations can only compete
with their rivals by innovating; and organizations can be innovative by managing their
human resources well. The employee attitude towards the system of an organization is
strongly linked to satisfaction with the system. The effectiveness of the system can be
known through the perceptions of employees to fairness of the system. No organization
operates automatically, it requires workforce whether it be small or big. Human resource
can be also termed as the power source of organization. It signifies what organization is all
about. However, workforce need to be addressed time and again to keep them motivated
and boosted. Now-a-days, organization have kept the workforce as their main concern
because they are the key success factor of an organization.
In present context if we see various business entities, they have not only come up with new
and innovative performance appraisal systems, but also implement the systems to motivate
employees as well as employers. Job satisfaction is important technique used to motivate
the employees to work harder. It is often said that, a happy employee is a productive
employee(Davis, 2010)and it’s true. Job satisfaction may lead to kill the toxicity in a toxic
worker. Performance appraisal has direct relationship with employees. It is very important
for employees to understand their perceptions towards their performance appraisal system.
Likewise, performance appraisal helps an employer to comprehend and relate employees
with respect to their job. Performance appraisal system helps employees to their strengths
and weaknesses.It helps them to improve their skills in order to work efficiently.Simply,
performance appraisal (PA) is a part of performance management system which makes the
systematic evaluation of the performance of employees and helps to understand the
abilities of a person for further growth and development. The system helps to find out
whether an employee needs training & development, promotion, transfer, recognition and
many more.
Performance appraisal system wasintroduced in the Nepal by Nepal Rastra Bank, the
central bank of Nepal in 1956. According to NRB while performing Performance
Appraisal, every staff is evaluated bi-annually. Criteria on which appraisal is to be
performed is prescribed by law. On basis of those criteria, the Supervisor rates her/his
subordinates and the result of the rating are kept confidential. As the time passed, different
changes have been brought in the principle and procedures of the appraisal system.
To show the satisfaction level of employees on performance appraisal system, a research is

conducted with the employees at NICAsia.
NIC Asia Bank is one of the largest commercial banks in the country.In terms of capital
base, balance-sheet size, number of branches, ATM network and customer base; it is one
of the largest private sector. NIC Asia Bank was established on 21 st July 1998. The Bank
was renamed as NIC Asia Bank after the merger of NIC Bank with Bank of Asia Nepal on
30th June 2013. NIC Asia is one of the most successful commercial banks in Nepal. The
Bank has 159 branches and 4 extensions and 141 ATMs across Nepal with a network
covering all major financial centers of the country. NIC Asia was awarded as “Bank of the
Year 2013-Nepal” by The Banker, Financial Times, UK. It has been awarded twice first
one being in 2007. The vision of the bank is to become a leading bank in Nepal by
providing complete financial solutions to our customers, superior value to our shareholders
and promising growth opportunities to its employees.
Human resource is vital component of company. They are the wealth of the organization
utilized for achieving goals. In the present complex business environment, no business and
organization survive and grow without healthy human resources. It has been widely
accepted that performance appraisal is one of the most important aspects of human
resource practices of any organization(Boswell & Boudreau, 2002). Also, performance
appraisal plays a vital role for both employees and organizations. Likewise, appraisal of
the performance of the employees is carried out for two major purposes namely,
administrative purpose and self-improvement &self-development of employees. Although
there is an increasing importance to performance appraisal, there has been very limited
research in the real industry. There can be gap between the expectations and standards of
performance appraisal in an organization. Thus, to address the possible scenario, study will
be done to evaluate whether the employee is satisfied in the present performance appraisal
system at NIC Asia Bank. The research seeks to find answer to the following questions:
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 Whether Performance Appraisal system is effective or not?
 Whether employee participation in establishment of performance appraisal system
can improve and enhance their performance?
 Are the feedback receive accurate or not?
 Are the raters able to use the appraisal instrument appropriately or not?
1.2 Objectives of the Study
This research aims at achieving the following objectives:
 To find out what factors influences about the satisfaction level.

 To identify importance of performance appraisal for employees’ career
development
 To evaluate the satisfaction level of the employees
 To evaluate present performance appraisal practices as perceived by the employees
1.3 Significance of the Study
Work performance appraisal systems assess the employee's effectiveness, work habits and
the quality of their work. The research is focused to evaluate the accuracy and
effectiveness of the appraisal instrument and its influence on employee satisfaction. This
research helps to know about the fact that different employees are driven by their unique
motive, causing deviations in the perception regarding the performance appraisal system.
The performance appraisal is an important tool to many human resource functions. How
effectively the managers are communicating their performance appraisal system to the
employees can be significant. Hence, relationship between employee satisfaction and
performance appraisal is an important area of research for us.
Performance appraisal is often viewed as extra work by many supervisors. As the end of
the fiscal year approaches, supervisors are flooded with other official affairs, making them
least focused on the appraisal. This results in many biases, which some employees tend to
cash in by working late even if they don't have to. Others are busy being visible in their
supervisor's eye. This behavior leads to regency error where supervisor uses it while
appraising to recall and remember recent works of their employees, influencing his
decision to rate the employee positively.
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1.4Literature Review
The literature review section of the study covers the conceptual review which includes the
concept of Performance appraisal system and variables like employees’ satisfaction. It also
includes background of performance appraisal system. Similarly, in the Empirical Review
section it deals with review of various articles from International and National Journal.
1.4.1 Theoretical Review
The theoretical review of the study deals with concept of performance appraisal, CIPD
view point, importance, process and methods.
1.4.1.1 Concept of Performance Appraisal

Performance can be defined as
“What is expected to be delivered by an individual or a set of individuals within a
timeframe. What is expected to be delivered could be stated in terms of results or
efforts, tasks and quality, with specification of conditions under which it is to be
delivered” (Kumari & Malhotra, 2012)
Armstrong (2006) defined Performance Appraisal as the formal assessment and rating of
individuals by their managers. According to Armstrong Performance Appraisal is
conducted usually as annual review meeting. While the Chartered Institute of Professional
Development (CIPD) have in-depth definition, which states that
Performance Appraisal is an opportunity for individual employees and those

concerned with their performance, typically line managers, to engage in a dialogue
about their performance and development, as well as the support required from the
manager’(CIPD, 2012).
1.4.1.2 CIPD Viewpoint

As mentioned previously, the (CIPD, 2012) define performance appraisal as an opportunity
for individual employees and those concerned with their performance to engage in a
dialogue about each individual’s performance and development, as well as the support
required from the manager. They also state how important it is to recognize that
performance appraisal is not just about assessing the past but also about driving behavior
that will sustain performance in the future.
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The CIPD (2012) believes that Performance appraisal is an operational task, it is short to
medium-term and mainly concerned with individual workers and their performance and
development. While it is one of the elements of performance management, and the data
produced can feed into other components of performance management, appraisal by itself
does not constitute performance management.
1.4.1.3 Importance of Performance Appraisal

Now-a-days the importance of performance appraisal is growing. Before managers used to
take PA as extra work load, but with the time passes by this system was recognized as an
integral part of organization development. This system helps to know which employee
should get promoted, it measures the potentiality of employees. This system helps in
human resource planning, making compensation decisions. It helps organization in
employees’ selection process and help to make employees training and development
decisions. It also provides feedback to employees.
1.4.1.4 Benefits of Performance Appraisal

An effective performance appraisal system is important because it benefits organization as
a whole. It benefits to the staff member being appraised, the manager completing the
appraisal.
For the Organization, benefits of PAinclude;Improved Performance due to effective

communication, increased sense of cohesiveness and better management-staff
relationships, Training and Development needs are identified more clearly and Employee
Satisfaction as a sense that employees are valued is spread
For the staff being appraised, the benefits include;Enhanced relationships with line
managers, Increased job satisfaction, a better understanding of expectation of the
employers and greater knowledge of strengths and weaknesses
1.4.1.5 Methods of Performance Appraisal

There are various methods to measure performance appraisals of a business. Not all the
methods suit all the organizations. None should be accepted or dismissed as appropriate
unless they relate to the particular needs of the organization or an employee. Some of the
popular methods of performance appraisal are described below:
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Rating Scales: Rating scales consists of bipolar numerical scales. Employees
characteristics is measured ranging from poor to excellent. It presents job related
performance criteria such as dependability, initiative, output, attendance, attitude etc. The
numerical scores are computed and final conclusions are interpreted. It is easy to use and is
less expensive. For this methods rater doesn’t need formal training and it is suitable in
every type of job evaluation process.
Checklist: checklist method is the method in which questionnaire in form of Yes or No is

prepared and distributed to staffs. In this method evaluation is done by HR department,
raters’ part is only to do reporting. This method is economical and can be easily conducted
through limited training. However, the result may not be accurate as raters are not allowed
to give relative rating and the power is in the hands of HR department.
Forced Choice Method: In this method of performance appraisal system, raters are given
arranged statement in the blocks of two or more. The rater is forced to make a choice
whether the statement provided is true or false. There might be personal biases because of
forced choice and the statement may be wrongly framed. Actual assessment is done by HR
department.
Critical Incidents Method: This method is based on the behavior of the employees. The
method focuses on specific critical behaviors of employee which causes the difference in
the performance. Supervisors record such incidents. Evaluations are based on actual job
behaviors. As ratings are supported by descriptions, feedback process is easy. But too
much feedback may appear as punishment.
Behaviorally Anchored Rating Scales: Behaviorally anchored is a rating scale which

uses behavior to rate the point. It shows effective and ineffective behaviors of employees
which is them used to determine the point. Somehow, this method helps to overcome the
rating errors.
Field Review Method: The process of making appraisal by HR department is called field
review method. Someone outside of employees’ own department carry out this approach.
As the appraisal is done by outsiders who aren’t really familiar with work environment of
the employees, actual behavior is not possible to observe. This method is mostly used
when comparable information is needed.
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Essay Method: Essay method can also be said detail description method of PA. Here,
detailed information of employee, their capabilities, promotability is made. This method
helps to know the weakness and strength of the employees. It is used to fill gaps about
employees. For this method to work writing skills of rater is important because it might
sometimes create confusion.
Management by Objectives: An organization sets some target objectives for their

employees. Rating is based on the achievements of those objective by the employees. This
approach sets standard goal and compare it with the goal that employees are able to attain.
Psychological Appraisals: This approach is based on the future performance of the

employees. It is related with the potential that one has in himself. It focuses on emotional,
intellectual character traits of the employees. To conduct this approach raters should do in-
depth study, continuous observation and this method also includes the help of supervisor.
The collected information is then evaluated.
360-Degree Feedback: 360-degree appraisals are commonly used to measure inter-

personal skills, customer satisfaction and team building skills of the employees. It is a
systematic collection of data relating to individual group. The person who have
information on the wok performance of employee, can do the job of appraiser.
1.4.1.6The Appraisal Process
Figure 1. 1: The Appraisal Process
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The appraisal process:
Step 1: Establish Performance Standards
The first step in the process of PA is defining the standards. The actual performance of the
employees will be compared with the standard performance. This shows the gap which
represents their contribution for attaining the targeted goal of the organization. This step
shows the degree of successful or unsuccessful of the performance of the employees.
These standards are necessary for each job position, because the performance standards are
used to fulfill the mission and vision of the company. Standard set must be clear and
simple so that everyone can understand them. It should be in measurable terms. Sometimes
employees’ performance cannot be measured, great measures should be taken to describe
the standards.
Step 2: Communicating the standards
Establishing performance standards isn't enough. Once the base standard is set, it is the
responsibility of the management to communicate the standards to all the employees of the
organization. All the employees should be informed and the standards should be clearly
explained to the employees. This step helps employees to know their role and the
expectations of employers from them. Before the evaluation process, the rater should know
the standard performance of individual employees.
Step 3: Measuring the actual performance
This is the most important process of PA. Measurement of actual performance of

individual employees is complicated and lengthy process. This step requires continuous
observation of employees. Proper data evaluation methods should be selected for this step.
The measurement should be done in such a way that the employees are not affected
negatively by such rating because such affected employees may not be enthusiastic about
PAS in future.
Step 4: Comparing actual performance with desired one
This step is related with the comparison of actual performance with the standard
performance. Performance standards are set up by employers on basis of previous data and
experiences. This step helps to know the data gap. It shows the deviation in employee’s
performance against the standard performance. The result may be contradictory. Some
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employees perform better than the standard performance set by the employers while some
might give under performance.
Step 5: Discussing results
This is the final step of PA process. The evaluated results are then communicated to
employees. Through the result, it is possible to discuss the work-related issues between
employers and employees. The feedback should be communicated in a way that doesn’t
affect the employees emotionally. Feedback should be in a way that encourages them to
perform even better in future. It should try to encourage and motivate employees. The
discussion of result helps to fill up the gap between actual performance and with that of the
standard performance.
1.4.2 Empirical Review
There are many approaches for evaluating employee behavior and performance with
respect to job tasks or an organizational culture. As a result, various applications of PA
have left many managers in a state of confusion and frustration with the employee
evaluation process (Gurbuz & Dikmenli, 2007).Performance Appraisal still plays a huge
part in organizations today. A report carried out by the CIPD in 2009 found that 81.3% of
organizations surveyed were carrying out performance appraisal in their organization as
part of their performance management. Now-a-days, performance appraisals have been
used in organizations for various reasons.
Meenakshi (2012) argues that Performance appraisal is not just about rating employees.
The article viewed administrative decisions of an organization such as promotion, rewards,
training and development are carried out on the basis of PA.On the journal by (Hillman,
Schwandt, & Bartz, 1990) states‘Appraisal is preceded by establishing general objectives
or a description for the job, identifying specific job expectations, providing feedback and,
when necessary, coaching’.When as organization carries out this process, management
have to perform the administrative operation like hiring and firing, reward choices as the
result gained through the appraisal process.
Fletcher (2004) states that the aims of Performance Appraisal also covers the area of
employees’ motivation, future derivatives planning and identifying employees’ potential
along with promoting manager assessment to control unsatisfactory performance. It views
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employees’ motivation, and feedback communication as a whole process of PAS.
According to Khan (2007)point of view the performance appraisal helps management to
conduct administrative decisions making process. It is related with promotions, firings,
layoffs and pay increases.
According to Obisi (2011), in his journal he states thatwhen an individual is satisfied with
the appraisal system then only efficiency and effectiveness of organizational performance
can be measured. This is the reason why organizations carry out the PA as a part of
Menash-boachie, F.O, & Seidu (2012) states that if employees recognize it as an

opportunity for personal development, a chance to be visible and demonstrate skills and
abilities and an opportunity to network with others, they are likely to embrace and
contribute meaningfully to the Performance Appraisal scheme. Employees sometimes tries
to take PA as an effort of management to get to know the employees. They take it as an
unreasonable effort. They think it as the way an organization takes control over the
employee. Thus, are uncomfortable toward PAS.
According to Cawley, Keeping & Levy, for performance appraisal to be effective and
useful, it is important that those taking part (the appraiser and the appraisee) are both
benefiting from it and find the procedure a productive tool. Without this, it would be
impossible for the system to work.
Murphy & Cleveland (1995) states that effective managers recognize PAS as a tool for
managing, rather than a tool for measuring subordinates. Such managers use PA to
motivate, direct and develop subordinates, and to maximize access to important resources
in the organization to improve productivity.
Piggot-Irvine (2003) she found that for performance appraisal to be effective the system.
Performance appraisal should be confidential, informative, have clear guidelines and be
educative. The process must be embedded completely throughout the organization where
the values shape part of the fabric of the everyday life of the workplace in order to have
effective appraisal.
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Figure 1. 2: Elements of appraisal effectiveness by Piggott-Irvine
1.4.3 Conceptual Framework and definition of variables
The variables under study have been represented diagrammatically to show the relationship
between them by illustrating the influence of the independent variables on the dependent
variable in order to give coherence to this report.
Independent variable:
Performance feedback
Rater accuracy Dependent Variable:
Employees participation Employees’ Satisfaction
Job criteria
Feedback communication
Figure 1. 3: Conceptual Framework
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The dependent variable of the study is employees’ satisfaction. The independent variable
of the study is performance feedback, rater accuracy, employees’ participation, job criteria,
feedback communication. Significance level of employees’ satisfaction is measured based
on the independent variable.
Employees’ Satisfaction
Employees’ satisfaction is the term used to represent whether the employees are happy and
satisfied with their work. It is a scale that measure how much an individual employee is
content in his/her job. it is the positive attitude of employee regarding their work.
Employees satisfaction is a vast term. When an individual is satisfied with their on-the-job
performance, then he is tagged as satisfied employee. Employees satisfaction is measured
using performance feedback, rater accuracy, job criteria, communication feedback. A
satisfied employee performs job well and increase the productivity.
Performance Feedback
Performance Feedback is a continuous process of exchange of information between
manager and subordinates. The information is about expected performance from
employees and the actual performance employees performs.
Feedback Communication
Feedback Communication is the flow of information about the performance of employees
from manager. Once the evaluation process is conducted, the employees should be
communicated about their performance. Employees should be aware of their potential and
their performance. This helps them to improve on-the-job performance.
Employees Participation
While making performance appraisal system and measuring instruments, employees
should also be participated. It leads to a better performance appraisal instrument.
Employees participation helps to develop instruments that are fair and reliable.
Job Criteria
Job of employees should be clearly defined. The company should provide employees with
reachable target. As per their performance employees should be recognized and
encouraged.
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Raters
Raters are the one who make performance assessment. To be able to do this, raters should
have necessary skills and they also need training for conducting PA interviews. They
should make training and evaluation in way that ensures appraisals is performed in a
similar and consistent manner throughout the organization.
1.5Research Methods used for Data Collection and Analysis
Research methods includes various procedures, step and calculation used to evaluate the
result. All the methods a researcher to find out the result during a research study is
research methods. Research methods helps us to make a framework on basis on which we
collect samples, data and find a solution to a problem.
Here we discuss the methodology used for the study and outline the key features of the
research design. Using a framework for the research process, this section looks at the aims
and objectives of the study, compare qualitative versus quantitative research
methodologies and the selection of the quantitative approach. The chapter also contains a
justification for the technique that was chosen for the research and looks at some of the
alternative methods that could have been used, whilst also discussing the advantages and
limitations for this study. The chapter goes on to look at the use of questionnaires,
interviews, issues with reliability, and ethical considerations of the research.
This project follows a case study method and analysis is done comparing information
based on demographic variables. This research is based on quantitative research method.
Primary source is used to collect data and information for our study. Primary information
is collected by designing questionnaire. We will take 41 respondents as a sample
representing different age group, income level and gender in an organization. Research
survey will be carried out by distributing set of questionnaire.
1.5.1. Research Design
The data are of quantitative nature. Quantitative nature of data is collected to fulfill the
objectives of research and to solve the research problem. The questionnaire survey is used
to collect the data and information. Quantitative research approach is the systematic
process. To meet the objectives, descriptive analysis was used. Descriptive research
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involves gathering data and information which are used to describes events and interpreate
the data collection.The descriptive research design helps researchers to present the
information in such a way that everyone can easily understand them. Usually, descriptive
analysis uses visual aids for presentation of the information like graphs and charts. It is all
about describing people who take part in the study without external manipulation.The
gathered information on variables are compared. The dependent variable and independent
variables are then compared to find out the relation between them after the incident has
already occurred.
Hence, considering the data collection method and interpretation methods used, the
suitable research design for this study is Descriptive Research Design and Casual
Comparative Research Design.
1.5.2. Population and Sampling
In other to meet the objectives of the study, population of the study taken is NIC Asia
Bank. There are 159 branches of the bank throughout the country. Thus, the population
will be 159 branches of NIC Asia Bank. The sample taken is different branch of NIC Asia
bank. The sample includes; NIC Asia Bank, New baneshwor branch, NIC Asia Bank,
Bhaktapur branch, NIC Asia Bank, New Pepsi Cola branch. Among all these sample
branch, only the staffs of operational and credit department were allowed to participate in
this survey. Thus, the sample of this research survey are the staffs of operation and credit
department of the above branch.
There are many variables that affect the satisfaction level of employees. Among those
variety of variables employees’ participation, job criteria, feedback communication,
performance feedback and raters are taken as independent variables.These sample
variables are selected since these variables is directly related with each other.
1.5.3 Data Collection
Data collection is the important step while conducting a research report. It incudes the
process used while collecting information and data. It also includes the step to measurethe
collected information. It helps researcher to evaluate outcomes. Data collection is used in
every field for collection and evaluation the the collected data. Data collection steps and
process may vary from different research.
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To fulfill the objectives of the research, only primary data is collected. The research report
is based on primary data.
For the collection of primary data, questionnaire survey was conducted. Primary data was
collected from a sample of 50 individuals of various age groups who are involved in
various professions chosen using a structured questionnaire. Among 50 questionnaires
provided, only 41 questionnaire were received back.A questionnaire is a series or set of
questions for the purpose of gathering information from respondent’s.Numbers of
questions in printed form were provided to staffs working at the moment and information
was collected.
1.5.4 Analytical Tool
The analytical tools used here are statistical tools and descriptive tools.
Pearson Correlation coefficient

It is a measure of the linear dependence (correlation) between two variables X and Y. It
has a value between +1 and −1 inclusive, where 1 is total positive linear correlation, 0 is no
linear correlation, and −1 is total negative linear correlation. Correlation can be calculated
from the formula:
n ∑ xy−∑ x ∑ y
r xy =
√ n ∑ x −¿ ¿ ¿¿
Where,
rxy is the correlation between two variables x and y.
In this research report, Pearson correlation coefficient is used to investigate relationship
between employees’ satisfaction and performance feedback, employees’ participation, job
criteria, employees’ participation, raters’ accuracy. This model is selected to analyze the
relationship between dependent variable and independent variables.This research report
uses SPSS to calculate correlation between the dependent and independent variables.
Mean and standard deviation are used to describe the data under the study. Here, mean is
used to evaluate the average of the information collected. Whereas, standard deviation is
used to know the range of fluctuation of the data.
15
Mean: The mean is the average of all numbers. To calculate mean of any data, add
together all of the numbers in the set and then divide the sum by the total count of
numbers. Mathematically,
∑x
Mean =
N
Where,
∑x= Sum of observation
N= Number of observation
Standard Deviation: Standard deviation is the measure of dispersion. It is used to
quantify the amount of variation or dispersion of a set of data values. It can be defined as
the positive square root of variance. Mathematically,
σ=
√
Σ( X−X )2
N
Where,
σ = Standard Deviation
Σ( X −X̅ ) 2 = Sum of square of difference of data and mean
In this research report, standard deviation is calculated for the responses provided in Likert
scale for all samples and for male and female.
1.6 Organization of the Study
The whole study is divided into three chapters and each chapter subdivided in various
topics, which includes the contents.
Chapter I include the background information, purpose of the study, significance of the
study, literature survey, research methods used for data collection and anaysis, limitation.
Chapter II is the main body of the report. It includes organization’s profile, data
presentation and analysis, findings and discussions of the study.
Chapter III integrates the various issues covered by the report. It summarizes up the result
obtained through analysis and recommends some suggestion and throws some light on its
impact on present scenario.
16
1.7 Limitations of the Study
This study is based on satisfaction level of employees on performance appraisal working at

NIC Asia. It means that the data analysis is purely from primary source. Like every other
research-based project work, thisalso have limitation. As data are collected through
primary source, the limitation was ignorance of respondents.
17
CHAPTER II
DATA PRESENTATION AND ANALYSIS

This chapter will present the data collected from the surveys completed by the employees
of the organization and go on to discuss the research findings. We have used graphs and
charts to display the findings in order to make it easier for the readers to analyze the
results. The chapter will first look at the demographic statuses of employees surveyed their
age, gender and length of service, it will then go on to examine and discuss the responses
to the questions asked and the statements that were presented to the respondents in the
questionnaire. The findings will look at how effective the appraisal is according to the
employees, this will be measured using their answers to the survey questions.
2.1 Data Presentation and Interpretation
Data analysis is the process of developing answers to questions by examination and

interpretation of data. This step is necessary for understanding results from surveys and
finding out the information on data gaps.
2.1.1 Demographic profile of the respondents
Demographic factors for the study are age, gender and education. The tables and figures
presented below shows the demographic profiles of the respondents.
Gender of the respondents

The bar diagram below represents the gender of the respondents.
Gender
35
30
25
20
15
10
5
0
Male Female Others
Figure 2. 1:Gender of Respondents
18
Of the 50 respondents, there were only 41 people who responded of which 31 were female
and 10 were males.The figure below shows the gender of the respondents with percentage.
Age of the respondents

The bar diagram below represents the age of the respondents.
Age
35
30
25
20
15
10
5
0
below 20 20-30 30-40 above 40
Figure 2. 2: Age of Respondents
Most participants on the survey are aged between 20-30, totaling 31 of the respondents.
One of the employee respondent is aged below 20 and none of them were above 40. The
employee respondent aged between 30-40 had total of 9 employees.
Length of service
The bar diagram below shows the length of service of the respondents.
Length of service
20
18
16
14
12
10
8
6
4
2
0
less than 2 years between 2-4 years between 5-7 years more than 7 years
Figure 2. 3: Length of Service
For this question, of the total 41 respondents, 19 of those are working in the organization
for less than 2 years. 19 respondents are working in the company between 2-4 years, 2 of
19
the employee is working in the company for 5-7 years and 1 of employee is working in the
company for mor than 7 years. The largest section of employees are in the organization are
less than 2 years and between 2-4 years. The smallest category with 1 of the 41 staff
surveyed are in the company for more7 years.
An employee’s length of service can have a forceful influence on how they perceive
Performance Appraisals. If an employee is with the company less than a year and has only
one appraisal meeting then they may have a different view on it that someone who is with
the company over 5 years. This can be a problem in many elements of the appraisal, in
particular when looking at whether the system is of benefit to the employees. Someone in
the same position and in the same organization for a long length of time may feel that there
is not as much to gain from Performance appraisal as someone who is new to the company.
They may find it difficult to keep setting goals and may find the systems less valuable than
others. As a result, they may have a negative view on performance appraisal. The
researcher will later look at length of service and the need for appraisal simultaneously.
Effectiveness of Appraisal system

The bar diagram below shows the effectiveness of appraisal system of NIC Asia Bank.
Effectiveness of Appraisal System

25
20
15
10
0
very high high moderate low negligible
Figure 2. 4: Effectiveness of Appraisal System
According to the responses of this question, 6 respondent rated the performance appraisal
method as very highly effective. 20 respondents, rated the performance appraisal method
as highly effective. 14 of the respondents rated it as moderate, 1 respondents who rated the
appraisal system negatively. More than half of the employees surveyed feel the system is
20
efficient, this is a positive result for the company. The objective of evaluating the
efectiveness of PAS is measured.
Effective Communication of the objectives

The bar diagram below represents effective communication of the objectives.
Effective Communication
40
35
30
25
20
15
10
5
0
yes no
Figure 2. 5: Effective Commination of the Objectives
According to the responses, 35 of the respondents agrees that the performance goals are
communicated effectively. 6 of the respondents disagrees that the performance goals are
not effectively communicated. The organization must communicate the goal or the
objectives of the company clearly and precisely so that the employees can work according
to the objectives of the company for the betterment of the company.
2.1.2 Reliabiltiy Test
Table 2. 1: Reliability test on Independent Variables

The table below shows the reliability test on independent variables.
Variables Cronbach's Alpha No. of Items

Employees’ Participation .836 5
Job Criteria .600 3
Feedback Communication .848 3
Performance Feedback .848 3
Raters .760 5
The Cronbach’salpha is used to estimate the reliability of the variables. It measures
internal consistency. It is measured between 0 to 1. The Cronbach’s alpha of employees’
participation is 0.836 which is good.The Cronbach’s alpha of job criteria is 0.600 which is
21
questionable.The Cronbach’s alpha of feedback communication is 0.848, which is
good.The Cronbach’s alpha of performance feedback is 0.834, which is good.The
Cronbach’salpha of raters is 0.760, which is acceptable. Thus, the test is reliable.
2.1.3 Variables profile and their interpretation
In this part, the responses collected during the survey are presented. The arguments of
statements are based on Likert scale. The statements regarding employees’ participation,
job criteria, feedback communication, performance feedback, raters, employees’
satisfaction, and personal development are presented and interpreted systematically.
2.1.3.1 Employees Participation

Table 2. 2: Willingness to participate in developing new appraisal system
The table below shows the argument on willingness to participate in developing new appraisal system. 5-
point Likert scale has been used, where 5 being strongly disagree and 1 being strongly agree.
Frequency Percentage Cumulative Percentage

Dimension (f) (%) (%)
Strongly Agree 9 21.95% 21.95%
Agree 19 46.34% 68.29%
Neutral 8 19.51% 87.80%
Disagree 3 7.31% 95.12%
Strongly Disagree 2 4.87% 100%
Total 41 100%
Source: Field Survey
The above table shows, 68.29% which is more than half respondents agreed on willingness
to participate in developing new appraisal sysytem. And 5 respondents disagree. This
indicates more respondents are willing to participate in developing new appraisal system.
The disagree numbers of respondents might mean they are alreay participating in
developing new appraisal system.
22
Table 2. 3: Participation on development leads to better PA instrument
The table below shows the argument on Participation on development leads to better PA instrument. 5-point
Likert scale has been used, where 5 being strongly disagree and 1 being strongly agree.
Frequency Percentage
Dimension (f) (%) Cumulative Percentage (%)
Strongly Agree 11 26.82%% 26.82%
Agree 22 53.65% 80.48%
Neutral 4 9.75% 90.24%
Disagree 4 9.75% 100%
Strongly Disagree 0 0
Total 41 100%
The above table shows, 80.48% respondents agreed onparticipation of employees in the
development of performance standard leads to a better performance appraisal
instrument.And 4 respondents disagree. Majority views that employees participation leads
to better PA instruements.
Table 2. 4:Performance evaluation with the help of employees

The table below shows the argument on Performance evaluation with the help of employees. 5-point Likert
scale has been used, where 5 being strongly disagree and 1 being strongly agree.
Agree 18 43.90% 70.73%
Neutral 7 17.07% 87.80%
Disagree 4 9.75% 97.56%
StronglyDisagree 1 2.43% 100%
Total 41 100%
The above table shows, 70.73% prefered their performance to be evaluated by an

instrument developed and designed with their help. And 5 respondents disagree. Most
respondents thinks evaluation should be done with help of employees. This leads to fair
and relevant evaluation process.
23
Table 2. 5: Employees participation leads to reliable and fair PA standards
The table below shows the argument on employees’participation leads to better PAstandards. 5-point Likert
Agree 25 60.97% 82.92%
Neutral 3 7.31% 90.24%
Disagree 4 9.75% 100%
Total 41 100%
The above table shows, 82.92% respondents think that employees participation leads to
development of reliable, valid, fair and useful performance standards. Here the number of
disagree is only 4. Paticipation of employees make them feel respondible.
Table 2. 6:Enhancement of employees’ participation for developing PA instrument

The table below shows the argument on Enhancement of employees’ participation for developing PA
instrument. 5-point Likert scale has been used, where 5 being strongly disagree and 1 being strongly agree.
Agree 18 43.90% 80.48%
Neutral 5 12.19% 92.68%
Disagree 3 7.31% 100%
Total 41 100%
The above table shows, 80.48% agree on employees participation should be enhanced
during desigining the rating format and measurement scale. The 3 respondents disagreed to
this. Employees’ should be encouraged to participate for developing PA instrument.
24
Table 2. 7: Descriptive analysis of employees participation
The table below shows the satisfaction regarding employees’ participation. 5-point Likert scale has been
used, where 5 being strongly disagree and 1 being strongly agree.
Code
Statement Mean Std. Deviation
EP1 I am willing to participate in developing a new 2.27 1.049
EP2 Participation of employees in the development of 2.02 .880
performance standards leads to a better performance
appraisal instrument.
EP3 I would prefer my performance to be evaluated by an 2.17 1.022
instrument developed and designed with the help of
employees.
EP4 Employee participation leads to development of 2.05 .835
reliable, valid, fair and useful performance standards.
EP5 Employee participation should be enhanced during 1.90 .889
designing the rating format and measurement scales.
The table shows descriptive analysis of the employees’ participation on performance

appraisal system.The mean is highest, 2.27at employees’ willingness to participate. The
mean of all the factors shows the respondents agrees that employees’ participation is need
for PA development. Even though the mean here shows the level of respondent agree on
the participation of employees, the standard deviation gives heterogenous result. The
standard deviation shows that there is a gap.
2.1.3.2Job Criteria
Table 2. 8: Defined task
The table below shows the argument on defined task. 5-point Likert scale has been used, where 5 being
strongly disagree and 1 being strongly agree.
Agree 13 31.70% 75.60%
Neutral 4 9.75% 85.36%
Disagree 6 14.63% 100%
Total 41 100%
25
The above table shows, 75.60% agreed on defined task. This result shows that the task of
employees are defined. Employees’ task should be clearly defined. The 6 respondents
disagreed. This shows that 6 employees work are not defined. PA should be done
according employees potential to performe defined task.
Table 2. 9: Reachable target

The table below shows whether the target is reachable or not. 5-point Likert scale has been used, where 5
being strongly disagree and 1 being strongly agree.
Agree 9 21.95% 41.46%
Neutral 7 17.07% 58.53%
Disagree 11 26.82% 85.36%
Total 41 100%
The above table shows, 41.46% thin the target is reacable. The 17 respondents disagreed
while 17 were neeutral about this. This shows the organization hasn’t been giving
reachable target to its employees.
Table 2. 10: Encouragement if target exceed

The table below shows if the employees are encouraged and recognized if the target is exceeded. 5-point
Frequenc
y Percentage
Agree 12 29.26% 53.65%
Neutral 14 34.14% 87.80%
Disagree 3 7.31% 95.12%
Total 41 100%
26
The above table represent only half of resondents were recognized and encouraged if their
target exceed. 22 respondents agreed that they were encouraged and motivated when their
target were exceeded. 5 respondents disagree to it. Employees should be motivated and
encouraged when the target is exceeded.
Table 2. 11: Descriptive analysis of job criteria

The table below shows the satisfaction regarding job criteria. 5-point Likert scale has been used, where 5
Code Statement Mean Std. Deviation

JC1 Your daily task is defined. 1.95 1.071
JC2 The company gives reachable target. 2.95 1.378
JC3 Company recognizes and encourages if target is 2.39 1.093
exceeded
The table shows descriptive analysis of Job criteria. The mean of all the factors are within
3 which means that their job criteria was defined. But the heterogenous standard deviation
shows that even if they were happy about their job criteria, most of them were not satisfied
with their job criteria. This shows most employees were recognized and encouraged to
perform better.
2.1.3.3 Feedback Communication
Table 2. 12: Feedback received

The table below shows the argument on feedback received. 5-point Likert scale has been used, where 5 being
strongly disagree and 1 being strongly agree.

Agree 21 51.21% 73.17%
Neutral 5 12.19% 85.36%
Disagree 4 9.75% 95.12%
Total 41 100%
27
The table above indicates the feedback was well received. 30 out of 41 respondents
believes that the feedback was received. But 6 respondents denied it. This shows they
didn’t receive feedback on their performance. Feedback should be given to the employees.
Table 2. 13: Feedback communication

The table below shows the argument on feedback communication. 5-point Likert scale has been used, where
5 being strongly disagree and 1 being strongly agree.
Frequenc
y Percentage Cumulative Percentage
Dimension (f) (%) (%0
Agree 16 39.02% 56.09%
Neutral 16 39.02% 95.12%
Disagree 2 4.87% 100%
Total 41 100%
The table shows that about 56.09% of the all respondents think that the feedback was
communicated. Only 2 respondent disagree to it. But the most respondents thoughts were
neutral toward it.
Table 2. 14: Accurate feedback

The table below shows the whether the feedback received is accurate and relevant. 5-point Likert scale has
been used, where 5 being strongly disagree and 1 being strongly agree.
Agree 10 24.39% 36.58%
Neutral 21 51.21% 87.80%
Disagree 4 9.75% 97.56%
Total 41 100%
28
Most of them were neutral about the relevancy and accuracy of the feedback received. But
there were strong agreement than disagreement. 15 respondents out of 41 thinks that the
feedack receive were accurate. 5 of the employees doesn’t agree to this.
Table 2. 15: Descriptive analysis of Feedback communication

The table below shows the argument on feedback communication. 5-point Likert scale has been used, where
5 being strongly disagree and 1 being strongly agree.
Std.
Code Statement Mean Deviation
FC1 Feedback is received. 2.24 1.067
FC2 Feedback is communicated. 2.32 .820
FC3 Feedback received is relevant and accurate. 2.66 .911
The table shows descriptive analysis of feedback communication. The mean shows that
respondents agrees on the feedback communication. The standard deviation here indicates
that there’s a gap in feedback receive. The standard deviation shows the deviation between
the results. The mean in “feedback received is relevant and accurate” is the highest that is
2.66. This show most employees think the feedback given to them were accurate and
relevant.
2.1.3.4 Performance Feedback

Table 2. 16: Improves on-the-job performance
The table below shows the argument the whether the performance feedback helps in improving the on-the-job
performance and attaining the goals. 5-point Likert scale has been used, where 5 being strongly disagree
and 1 being strongly agree.

Agree 11 51.21% 75.60%
Neutral 5 12.19% 87.80%
Disagree 5 12.19% 100%
29
Total 41 100%
The above table shows, 75.60% of all the respondnents think that the feedback received
helps to improve on-the-job performance. Feedback helps to know the mistakes and
strengths the performance of employees. PA helps to improve on-the-job performance of
employees. The 5 respondents disagreed to this.
Table 2. 17: Receive timely feedback

The table below shows the argument on regular and timely performance feedback beside the annual
performance review. 5-point Likert scale has been used, where 5 being strongly disagree and 1 being
strongly agree.
Percentag
Frequency e
Agree 14 34.14% 39.02%
Neutral 10 24.39% 63.41%
Disagree 13 31.70% 95.12%
Total 41 100%
The above table shows, half of respondents agrees and the other half doesn’t. 10
respondent were neutral about this. 34.14% agreed on the statement. So , the majority of
people agree to the statement.
Table 2. 18: Feedback accuracy

The table below shows the argument on level of accuracy on the feedback provided by the supervisor. 5-point
Dimension Frequency Percentag Cumulative Percentage (%)

(f) e
(%)
Agree 19 46.34% 51.21%
Neutral 13 31.70% 82.92%
Disagree 4 9.75% 92.68%
30
Total 41 100%
Most respondents viewd information provided by their supervisior as accurate during PA.
13 respondents were not sure about this. 46.34% of the respondents agree to the satement.
Thus, majority of respondents were satisfied with the feedback.
Table 2. 19: Detailed feedback

The table below shows the arguments on the information provided by supervisor during performance
feedback is sufficiently detailed. 5-point Likert scale has been used, where 5 being strongly disagree and 1
being strongly agree.
Dimension Frequency Percentage Cumulative Percentage (%)

(f) (%)
Agree 11 26.82% 39.02%
Neutral 16 39.02% 78.048%
Disagree 9 21.95% 100%
Total 41 100%
The above table represnets the feedback provided by their supervisor during PA were
detailed. The same number of the respondents take it as neutral while 9 respondents
disagree to it. 39.02% of respondents were neutral about the statement. Majority of the
respondents were not sure whether the provided feedback was detailed or not.
Table 2. 20: Feedback satisfaction

The table below shows the argument employees satisfaction on performance feedback. 5-point Likert scale
has been used, where 5 being strongly disagree and 1 being strongly agree.
Dimension Frequency Percentage Cumulative Percentage (%)

(f) (%)
Agree 12 29.26% 41.46%
Neutral 12 29.26% 70.73%
31
Disagree 11 26.82% 97.56%
Total 41 100%
The above table represents that the 17b respondents were satisfied with the feedback they
received. 12 respondents were not satisfied with their feedback.
Table 2. 21: Discuss work related issues with supervisor

The table below shows the necessity of discussing work-related issues with the supervisor. 5-point Likert
Dimension Frequency Percentage Cumulative Percentage

(f) (%) (%)
Agree 15 36.58% 63.41%
Neutral 12 29.26% 92.68%
Disagree 2 4.878% 97.56%
Total 41 100%
Out of 41 respondents, 26 believes they have to discuss work-related issues with their
supervisor. 12 respondents were neutral and 3 of the respondents disagree on the possiblity
to discuss work-related issues with the supervisor.
Table 2. 22: Ability of rater to use appraisal instrument appropriately

The table below shows the argument on the raters’ ability to use appraisal instruments appropriately. 5-point
Dimension Frequency Percentage Cumulative Percentage

(f) (%) (%)
Agree 16 39.02% 46.34%
Neutral 16 39.02% 85.36%
Disagree 5 12.19% 97.56%
32
Total 41 100%

The above table shows that 19 of the respondents thought raters were able to use the
appraisal instrument appropriately. 6 respondents disagree on this. Majority of the
respondents agreed on the statement.
Table 2. 23: Descriptive analysis of Performance feedback

The table below shows the argument on the raters’ ability to use appraisal instruments appropriately. 5-point
Std.
PF1 The performance feedback I receive is helpful in improving me 2.12 .927
on-the-job performance and in attaining my goals
PF2 I receive regular and timely performance feedback beside the 2.98 1.037
annual performance review.
PF3 The information provided by supervisors during performance 2.68 .986
feedback is accurate.
PF4 The information provided by supervisor during performance 2.71 .955
feedback is sufficiently detailed.
PF5 I am satisfied with my performance feedback. 2.78 1.061
PF6 2.20 .980
Throughout my performance feedback I feel that I have the
possibility to discuss work-related issues with the supervisor.
PF7 I think raters are able to use the appraisal instrument 2.63 .888
appropriately.
The table shows descriptive analysis of performance feedback. The mean of performance
feedback is all between 2-3 score range, which means that most respondent agree on the
performance feedback factors. The strongly believe that it will help them to improve on-
the-job performance. the heterogenous standard deviation represents the gap between agree
and disagree. As the standard deviation is heterogenous, it means even the respondents
agree on the performance feedback there is gap between the respondents agreed and
disagreed.
2.1.3.5 Raters
Table 2. 24: Raters skills in performance assessment
33
The table below shows the argument on raters’ skills in performance assessment. 5-point Likert scale has
Frequenc
y Percentage
Agree 21 51.21% 65.85%
Neutral 10 24.39% 90.24%
Disagree 2 4.87% 95.12%
Total 41 100%
The above table represents, 65.85% of the repondents thought raters have necessary skills
for performance assessment. 9.86% respondents disagree to it. They don’t think the raters
have necessary skills. Thus, the majority of the respondents agreed to the statement.
Table 2. 25: Training needed for conducting PA

The table below shows the argument on whether raters needs training for conducting PA. 5-point Likert
scale has been used, where 5 being strongly disagree and 1 being strongly agree .
Frequenc
y Percentage Cumulative Percentage
Agree 16 39.02% 56.09%
Neutral 13 31.70% 87.80%
Disagree 3 7.31% 95.12%
Total 41 100%
The above table represents, 56.09% of the repondents thought raters need more raining in
conducting appraisal interviews. 12.20% respondents disagree to it. It seems there aren’t
satisfied with the raters rating. The majority of the respondents agree to the statement.
Table 2. 26: Ability to use instrument as intended
34
The table below shows the argument on raters’ ability to use instrument as intended. 5-point Likert scale has
Agree 21 51.21% 58.53%
Neutral 14 34.14% 92.68%
Disagree 3 7.31% 100%
Total 41 100%
The above table represents, 58.53% of the repondents agree on the fact the raters are able
to use the appraisal instrument as intended. 7.42% respondents disagree to it.
Table 2. 27: Regular update of appraisal skills

The table below shows the argument on regular refreshed and update of appraisal skills. 5-point Likert scale
has been used, where 5 being strongly disagree and 1 being strongly agree.

Agree 15 36.58% 46.34%
Neutral 15 36.58% 82.92%
Disagree 7 17.07% 100%
Total 41 100%
The above table represents, 19 repondents agrees raters’ appraisal skills are regularly
refreshed and updated through training. 7 respondents disagree to it. The majority of the
respondents agreed on the statement. 36.58% were not sure about the regular update of
appraisal system.
Table 2. 28: Consistency of PA throughout the organization

The table below shows the argument on consistency and similarityof PA throughout the organization. 5-point
Dimension Frequenc Percentage Cumulative Percentage (%)
35
y
(f) (%)
Agree 20 48.78% 56.09%
Neutral 13 31.70% 87.80%
Disagree 5 12.19% 100%
Total 41 100%
The above table represents, 23 of the 41 repondents agrees training and evaluation ensures
that appraisal is performed in a similar and consistent manner throughout the organization.
5 respondents disagree to it. 48.78% agreed on the statement, so the majority of the
respondents agreed.
Table 2. 29: Descriptive analysis of Raters

The table below shows the argument on consistency and similarity of PA throughout the organization. 5-
point Likert scale has been used, where 5 being strongly disagree and 1 being strongly agree.
Std.
O1 Raters have necessary skills in performance assessment. 2.34 .965
O2 Raters need more training in conducting performance 2.44 1.026
appraisal interviews.
O3 Raters are able to use the appraisal instrument as intended. 2.41 .741
O4 Raters’ appraisal skills are regularly refreshed and 2.61 .891
updated through training.
O5 Training and evaluation ensures that appraisal is 2.49 .810
performed in a similar and consistent manner throughout
the organization.
The table shows descriptive analysis of Raters. The mean of all the factors are between 2-
3. It indicated they agree raters’ skills and consistency is rating is important for
employees’ satisfaction. Respondents strongly agrees on the fact that rater have necessary
36
skills needed for performance assessment. The greater the standard deviation, more the
gap. There is gap between the respondents who thinks more training to raters to conduct
PA interviews.
2.1.3.6 Personal development through participating in the performance
appraisal process
The bar diagram below shows the personal development through participation in the performance appraisal
process.
Personal Development
20
18
16
14
12
10
8
6
4
2
0
strongly agree agree neutral disagree strongly disagree
Figure 2. 6: Personal Development
The above bar graph represents that 18 respondents thought that PA helps them to develop
them personally. 5 respondents disagree to this. And 18 respondents were neutral about
this.
2.1.3.6 Employees Satisfaction

Table 2. 30: Timely payment is needed
The table below shows the argument on need of timely payment. 5-point Likert scale has
Frequenc
y Percentage
Agree 12 29.26% 70.73%
Neutral 8 19.51% 90.24%
Disagree 4 9.75% 100%
Total 41 100%
37
The above table represents, 70.73% of respondents needed timely payment to be satisfied.
And 4 respondents clearly disagree on this as a factor to satisfy employees.41.46%
strongly agreed on the statement. Timely payment is needed to satisfy the employees.
Table 2. 31: Satisfaction with pattern of training and development

The table below shows the argument on whether the employees are satisfied with the pattern of training and
develop. 5-point Likert scale has been used, where 5 being strongly disagree and 1 being strongly agree.
Agree 8 19.51% 46.34%
Neutral 8 19.51% 65.85%
Disagree 9 21.95% 87.80%
Total 41 100%
The above results shows that some one them were satisfied with the pattern of training and
some of them weren’t. Most of them were satisfied with the training and development. 19
respondents agreed that employees were satisfied with the training and development.
Table 2. 32: Satisfaction with work

The table below shows the argument on employees’ satisfaction with their job. 5-point Likert scale has been
used, where 5 being strongly disagree and 1 being strongly agree.
Agree 9 21.95% 53.69%
Neutral 9 21.95% 75.60%
Disagree 7 17.07% 92.68%
Total 41 100%
38
The above table shows that 21 respondents were satisfied with their work. 10 respondents
weren’t satisfied with their work. And 9 respondents were neither satisfied nor dissatisfied.
31.70% of respondents strongly agreed to the statement.
Table 2. 33: Job rotation satisfaction
The table below shows satisfaction of employees on job rotation. 5-point Likert scale has been used, where 5
Agree 10 24.39% 43.90%
Neutral 10 24.39% 68.2%
Disagree 7 17.07% 85.36%
Total 41 100%
The above table shows that 43.90% of the total respondents were ssatisfied with the job
rotation. 24.39% have neutral thoughts about it. Majority of the respondents agreed on the
statement.
Table 2. 34: Descriptive analysis of employees’ satisfaction

The table below shows satisfaction of employees’ satisfaction. 5-point Likert scale has been used, where 5
Code Statement Mean Std. Deviation

ES1 Timely payment is what I need. 1.98 1.012
ES2 I am satisfied with the pattern of training and 2.73 1.397
development.
ES3 I am satisfied with my work. 2.46 1.306
ES4 Job rotation satisfies me. 2.83 1.340
The table shows descriptive analysis of Employees’ satisfaction. The mean deviation
represents that most of the employees were satisfied. Respondents strongly agree timely
payment as the factor of employees’ satisfaction. Even though the mean shows the
satisfaction, the standard deviation shows that there was more gap between the satisfied
and dissatisfied one.
39
2.2 Pearson Correlation Analysis
Table 2. 35: Correlation analysis of the variables

The table below shows the relationship between dependent and independent variables.
Employee
Participatio Job Feedback Performance
n Criteria Communication Feedback Raters
Variables
Employees Satisfaction .060 .089 .018 .203 .071
(Pearson Correlation)
**. Correlation is significant at the 0.01 level (2-tailed).
Correlation shows the relationship between dependent and independent variables. To

evaluated the employees level of satisfaction on performance appraisal system, employees
satisfaction is the dependent variables and independent variables includes employees
participation, job criteria, feedback communication,performance feedback and raters. The
negative result in correlation indicate weak between the dependent and independent
variables. The positive correlation relation shows the strong relation between the
dependent and independent variables.
In the above table, it shows the positive relation between dependent and independent
variables. Even though there is positive relation, the relationship is weak. It shows
positively week relation between dependent and independent variables. From the above
information it is shows that dependent variable employees satisfaction has the strongest
correlation with performance feedback that is 0.203. And employees satisfaction have the
weakest correlation with feedback communication, that is 0.018. This indicates
performance feedback is satisfactory in the organization. The employeesare satisfied with
their performance feedback and the received performance feedback helps them to improve
on-the-job performance and attaining goal. And the weak correlation with feedback
commuincation indicats employees are not commuincated about their performance
appraisal. Employees are dissatisfied with feedback communication process and they
somehow perceives the information inaccurate and irrelevant.
40
2.3. Major Findings
The basic objective of the study is to explain the impact of independent variables:
employees participation, job criteria, communication feedback, rater, performance
feedback on dependent employees’ satisfaction. The descriptive research design has been
employed to measure the average and fluctuation in perception of employees on
PAS.Primary data is used for analysis which is collected through the questionnaire.
Descriptive research includes surveys. In this study, data was analyzed using mean,
standard deviation and correlation analysis. The major objectives of the research report
were fulfilled. The major findings of the study are summarized as below:
 Employees were highly satisfied with effectiveness of PAS in the organization. Out
of 41 respondents 20 vey highly satisfied while just 1 respondent was negative
about the PAS.
 18 respondents were neutral about the importance of performance appraisal for
employees’ career development. 5 respondents disagree about their career
development through PAS.
 The Correlation coefficient between employees’ satisfaction and other independent
variable show the positive linear relation.The dependent variable employees
satisfaction has the strongest correlation with performance feedback that is 0.203.
And employees satisfaction have the weakest correlation with feedback
communication, that is 0.018
41
CHAPTER III
CONCLUSION AND ACTION IMPLICATIONS

The earlier chapter presented the data collection and evaluation of the collected data.
Whereas this chapter deals with the conclusions and recommendations based on the
findings of the study. Accordingly, this chapter is organized into two sub-sections. First
section presents the conclusions and Second section presents the recommendations.
3.1. Conclusion
The aim of the project work was to examine the Employees perception of performance
appraisal in the NIC Asia Bank and our measure objectives that were fulfilled are:
 To find out what factors influences about the satisfaction level.

 To identify importance of performance appraisal for employees’ career
development.
42
 To know fairness in present performance appraisal practices as perceived by the
employees.
To complete this aim,literature on the area of performance appraisal and related areas
comprehensively were viewed and then conducted a survey with employees of the
organization (NIC Asia Bank). The survey analyzed the current system in place in the
organization.
A vast amount of the literature on performance appraisal demonstrated the benefits of

having performance appraisal systems in place and looked at how they can be used for a
variety of purposes. More recent academics discussed the ineffectiveness appraisal
processes can have and the negative impact on the system and the organization as a whole.
They also mentioned how important it is to have a good system in place so that it does do
what it sets out to.
The research revealed that the majority of employees in the organization complete
performance appraisal and for the most part, have an appraisal meeting once a year.
According to the finding of the research, it shows PAS contains other various factors
which helps to make the system effective in every level.
The analysis of the survey responses has revealed that according to the employees,
Performance Appraisal is effective and they believed that employee participation in
establishment of performance appraisal system can improve and enhance their
performance. They believed thatPA system is a worthwhile tool; it motivates them and
improves their performance. While the system has its flaws and needs a lot of improving to
get it to where it needs to be, it is going in the right direction and has some positive results.
3.2. Action Implications
Based on the finding, below are the three recommendations that has made for the
organization to make their appraisal system more effective. They are:
 Greater Employee Involvement: For the appraisal system to be effectiveand to

benefit all involved, higher level of employee participation than the present
involvement on system development is needed. Manager and Employees jointly
contribution helps in better development plan.
43
 For an individual employee, PA is important to help him/her develop their self
personally in on-the -job performance. An organization must ensure the employees
that the PAS helps them to improve themselves. An organization should be able to
encourage employees about PA.
 The survey showed that some employees areappraised twice a year and yet some
are appraised every 12 months. This shows inconsistency.It is not cleared who is
setting the goals, what the goals are based on and whether employees feel the
appraisal is efficient or inefficient.
The organization should look to introduce a framework for Performance Appraisal within
the company that sets out a number of important objectives such as fairness,
confidentiality, employee development and mutual involvement. Likewise, organization
should prioritize the employee participation in setting their objectives and improving the
relationship between supervisor and employees. This framework would need to be
explained to all involved in the process and training provided so as to ensure managers and
employees are aware of how the system works and can stick to the guidelines.
44
REFERENCES
Armstrong, M. (2006). Performance Management: Key Strategies and Guidelines.
London: Kogan Page.
Boachie-Mensah, F. O., & Seidu, P. (2012). Employees' Perception of Performance

Appraisal System: A Case Study’. International Journal of Business &
Management, 73-88.
CIPD. (2012). Retrieved from http://www.cipd.co.uk/hr-topics/strategic-hr.aspx
Davis, E. L. (2010). A happy employees is a productive employee. Library Faculty & Staff
Presentations, 18.
Fletcher, C. (2004). Appraisal and Feedback. In Making Performance Review Work.

London: Chartered Institute of Personnel and Development.
Gurbuz, S., & Dikmenli, O. (2007). Performance appraisal in public organisations: An

empirical study. In Magazine of Management Practice (pp. 108–138).
Hillman, L., Schwandt, D., & Bartz, D. (1990). Enhancing Staff Members' Performance
through Feedback and Coaching. Journal of Management Development, 20.
Khan, A. (2007). Performance Appraisals Relation with Productivity and Job Satisfaction.
Journal of Managerial Sciences, 100-114.
Kumari, & Malhotra. (2012). Effective Performance Management System for enhancing
growth. Global Management Journal, 78.
Meenakshi. (2012). Multi source feedback based performance appraisal system using
Fuzzy logic decision support system.
Menash-boachie, F.O, & Seidu , P. (2012). Employees' Perception of Performance

Appraisal System: A Case Study. I. international Journal of Business &
Management, 73-88.
Murphy, K. R., & Cleveland, J. N. (1995). Understanding performance appraisal: Social,

organisational and goal-based perspectives. California: Sage, Thousand Oaks.
Obisi. (2011). Employee Performance. Appraisal and its implication for Individual and.
Organizational Growth. Australian Journal of Business and Management Research,
92.
Piggot-Irvine, E. (2003). Key features of appraisal effectiveness. The International Journal

of Educational Management, 170-177.
APPENDIX
Research questionnaire for employees’ satisfaction on Performance appraisal system.
Tick or mark (√) for the choose one.
Section A. General Information

1. Gender (Please tick any one)
Male [ ] Female [ ] Other [ ]

2.Age:
a. Below 20 [ ] b. 20 -30 [ ] c. 30-40 [ ] d. Above 40 [ ]
3. For how long have you been working at NIC Asia Bank?
a. Less than 2 years [ ] b. Between 2-4years [ ]
c. Between 5-7 years [ ] d. More than 7 years [ ]
Section B. Performance Appraisal
Appraisal practices often include formal review and feedback sessions, and may include
procedures for establishing work objectives, conducting self-appraisals, and setting
performance goals.
Make (√) mark for the selected answer.
1. Does NIC Asia Bank have performance appraisal system?
a. Yes [ ] b. No [ ]
2. How would you rate the effectiveness of performance appraisal system in the
organization?
a. Very high [ ] b. High [ ] c. Moderate [ ]
d. Low [ ] e. Negligible [ ]
3. How often is appraisal carried out in your department?
a. Monthly [ ] b. Semi-Annually [ ] c. Annually [ ]

4. Are the performance goals/objectives effectively communicated?
a. Yes [ ] b. No [ ]
Section C. Performance Appraisal Rating
Indicate the level of your agreement with the following statement. Where 1=Strongly Agree, 2=
Agree, 3= Neutral, 4= Disagree, and 5= Strongly Disagree.
1. Employee Participation
Code Employee Participation 1 2 3 4 5

I am willing to participate in developing a new
EP1
Participation of employees in the development of
EP2 performance standards leads to a better performance
appraisal instrument.
I would prefer my performance to be evaluated by an
EP3 instrument developed and designed with the help of
employees.
Employee participation leads to development of
EP4
reliable, valid, fair and useful performance standards.
Employee participation should be enhanced during
EP5
designing the rating format and measurement scales.
2. Job Criteria
Cod
Job Criteria 1 2 3 4 5
e
JC1 Your daily task is defined.
JC2 The company gives reachable target.
JC3 Company recognizes and encourages if target is
exceeded.
3. Feedback Communication
Cod
Feedback Communication 1 2 3 4 5
e
FC1 Feedback is received.
FC2 Feedback is communicated.
FC3 Feedback received is relevant and accurate.
4. Performance Feedback
Code Performance Feedback 1 2 3 4 5
The performance feedback I receive is helpful in improving

PF1
me on-the-job performance and in attaining my goals
I receive regular and timely performance feedback beside
PF2
the annual performance review.
The information provided by supervisors during
PF3
performance feedback is accurate.
PF4 The information provided by supervisor during performance
feedback is sufficiently detailed.
PF5 I am satisfied with my performance feedback.
Throughout my performance feedback I feel that I have the
PF6 possibility to discuss work-related issues with the
supervisor.
I think raters are able to use the appraisal instrument
PF7
appropriately.
5. Raters
Cod
Raters 1 2 3 4 5
e
O1 Raters have necessary skills in performance assessment.
Raters need more training in conducting performance
O2
appraisal interviews.
O3 Raters are able to use the appraisal instrument as intended.
Raters’ appraisal skills are regularly refreshed and updated
O4
through training.
Training and evaluation ensures that appraisal is performed
O5 in a similar and consistent manner throughout the
organization.
6. Since participating in the Performance Appraisal process, I have developed

personally
1 2 3 4 5
Strongly agree Strongly disagree
7. Employees Satisfaction
Code Employees Satisfaction 1 2 3 4 5

ES1 Timely payment is what I want.
I am satisfied with the pattern of training and
ES2
development.
ES3 I am satisfied with my work.
ES4 Job rotation satisfies me.
Section D. System Review
1. Are you involved in the process of setting objectives and targets of your future
performance?
Yes [] No [] Maybe []
2. Are your pay, benefits and promotion opportunities based on your performance
ratings?
Yes [ ] No [ ] Maybe [ ]
3. Who sets the goals that are put in place in the meeting? *
You[ ] Your manager[ ] Both[ ]
4. Are the targets based on?
Individual Needs[ ] Business Needs[ ] Other[ ]

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“Employees’ Satisfaction with the Performance Appraisal System in NIC

A Summer Project Report Submitted to

Bachelor of Business Administration (BBA)

I wish to express my appreciation to my family as well as my friends for their valuable

PA- Performance Appraisal

NRB- Nepal Rastra Bank

CIDP- Chartered Institute of Professional Development

List Title Page

Figure 2. 1:Gender of Respondents 18

List Title Page

1.1 Context Information

To show the satisfaction level of employees on performance appraisal system, a research is

1.2 Objectives of the Study

This research aims at achieving the following objectives:

 To find out what factors influences about the satisfaction level.

1.3 Significance of the Study

1.4.1 Theoretical Review

1.4.1.1 Concept of Performance Appraisal

Performance Appraisal is an opportunity for individual employees and those

1.4.1.2 CIPD Viewpoint

1.4.1.3 Importance of Performance Appraisal

1.4.1.4 Benefits of Performance Appraisal

For the Organization, benefits of PAinclude;Improved Performance due to effective

1.4.1.5 Methods of Performance Appraisal

Checklist: checklist method is the method in which questionnaire in form of Yes or No is

Behaviorally Anchored Rating Scales: Behaviorally anchored is a rating scale which

Management by Objectives: An organization sets some target objectives for their

Psychological Appraisals: This approach is based on the future performance of the

360-Degree Feedback: 360-degree appraisals are commonly used to measure inter-

1.4.1.6The Appraisal Process

Figure 1. 1: The Appraisal Process

Step 2: Communicating the standards

Step 3: Measuring the actual performance

This is the most important process of PA. Measurement of actual performance of

Step 4: Comparing actual performance with desired one

1.4.2 Empirical Review

Menash-boachie, F.O, & Seidu (2012) states that if employees recognize it as an

1.4.3 Conceptual Framework and definition of variables

Figure 1. 3: Conceptual Framework

1.5Research Methods used for Data Collection and Analysis

1.5.1. Research Design

1.5.2. Population and Sampling

1.5.3 Data Collection

1.5.4 Analytical Tool

Pearson Correlation coefficient

This study is based on satisfaction level of employees on performance appraisal working at

DATA PRESENTATION AND ANALYSIS

2.1 Data Presentation and Interpretation

Data analysis is the process of developing answers to questions by examination and

2.1.1 Demographic profile of the respondents

Gender of the respondents

Age of the respondents

Figure 2. 2: Age of Respondents

Figure 2. 3: Length of Service

Effectiveness of Appraisal system

Effectiveness of Appraisal System

Figure 2. 4: Effectiveness of Appraisal System

Effective Communication of the objectives

Figure 2. 5: Effective Commination of the Objectives

2.1.2 Reliabiltiy Test

Table 2. 1: Reliability test on Independent Variables

Variables Cronbach's Alpha No. of Items

2.1.3 Variables profile and their interpretation