Name: Sindhuja Y

MBA (HRM) – H SECTION

215062101213

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 CHAPTER- 1
INTRODUCTION
1. Introduction:
Performance appraisal is the process of evaluating the performance and
qualification of the employees in terms of the administration including
promotion, providing financial rewards, and other placement selection actions
which require differential treatments among the member of the group
distinguished from action affecting all members equally. An appraisal should
not be viewed as an end in itself, but rather as an important process within a
broader performance management system that links-

a. Organisational objectives

b. Day-to-day performance

c. Professional development

d. Rewards and incentives

Performance in the organizational context is a function of determining job

criteria, selecting those employees who will be able to perform the required
organizational task, motivating and developing them for improving their job
skills, and preparing them for higher responsibilities. Hence, the process of
performance appraisal involves obtaining, recording, and analysing information
about the relative worth of an employee.

The focus of performance appraisal is as much on measuring and improving of

the actual performance as on the future potential of the employee. This activity

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is performed annually by a supervisor for his/her subordinates designed to help
employees understand their roles, objectives, expectations, and performance
success. Performance appraisal can be used for developmental as well as
administrative purposes. It is a powerful tool to calibrate, refine, and enhance
the capabilities of the employee.

The developmental purpose of performance appraisal provides feedback for

identifying the employee’s strengths and weaknesses, improving performance,
and planning for training and development needs of the future. The emphasis is
on improving the employee’s on-the-job behaviour.

The administrative purposes include decisions regarding promotions, transfers,

demotions, or layoff. It also provides inputs to other HR activities such as
compensation programmes, recruitment and selection, human resource planning,
career planning, and the like.

Definition

Performance appraisal is the systematic evaluation of the individual with respect

to his/her performance on the job and his/her potential for development
periodically according to a definite plan performance appraisal refers to how
Performance appraisal is the systematic description of an employee’s job-
relevant strengths and weaknesses the purpose is to find how well the employee
is performing his join and establish a plan of improvement performance
appraisal is arranged well is someone is doing the assigned job evaluation
determines how much job is work to the organization and therefore what range
of pay should be assigned to the job.

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 1.1 Industry Profile

Information technology (IT) industry in India has played a key

role in putting India on the global map. IT industry in India has been one of the most
significant growth contributors for the Indian economy. The industry has played a
significant role in transforming India’s image from a slow moving bureaucratic economy
to a land of innovative entrepreneurs and a global player in providing world class
technology solutions and business services. The industry has helped India transform from a
rural and agriculture-based economy to a knowledge based economy.
Information Technology has made possible information access at gigabit speeds. It has
made tremendous impact on the lives of millions of people who are poor, marginalized and
living in rural and far flung topographies. Internet has made revolutionary changes with
possibilities of e-government measures like e-health, e-education, e-agriculture, etc. Today,
whether its filing Income Tax returns or applying for passports online or railway e-ticketing,
it just need few clicks of the mouse. India’s IT potential is on a steady march towards global
competitiveness, improving defense capabilities and meeting up energy and environmental
challenges amongst others. IT-ITeS sector in India, with the main focus on increasing
technology adoption, and developing new delivery platforms, has aggregated revenues
of USD 88.1 billion in FY2011, while generating direct employment for over 2.5 million
people. Out of 88.1 billion, export revenues (including Hardware) has reached USD
59.4 billion in FY2011 while domestic revenues (including Hardware) of about USD
28.8 billion. Government Initiatives: After the economic reforms of 1991-92, major fiscal
incentives provided by the Government of India and the State Governments, like,
liberalization of external trade, elimination of duties on imports
of information technology products, relaxation of controls on both inward and outward
investments and foreign exchange, setting up of Export Oriented Units (EOU), Software
Technology Parks (STP), and Special Economic Zones (SEZ), has enabled India to flourish

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and acquire a dominant position in world’s IT scenario. In order to alleviate and to promote
Indian IT industry, the Government of India had set up a National Task Force on IT and
Software Development to examine the feasibility of strengthening the industry. Venture
capital has been the main source of finance for software industry around the world.
In line with the international practices, norms for the operations of venture capital funds
have also been liberalized to boost the industry. The Government of India is also actively
providing fiscal incentives and liberalizing norms for FDI and raising capital abroad.

1.2 Company profile

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Graphic design is a craft where professionals create visual content to communicate

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Generate leads and raise awareness with LinkedIn social advertising. Target audiences
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Social media marketing
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Ppc
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1.3 Need for study
➢ Performance appraisals of Employees are necessary to understand each
employee's abilities, competencies and relative merit and worth for
the organization.

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 ➢ Performance appraisal rates the employees in terms of their performance.
It is widely used in the society.
➢ Performance appraisals are essential for the growth of a company and the
employee. It helps the company to find out whether the employee is
being productive or is a liability.
➢ It helps the employee to find out where his / her career is heading. It is an
essential part of HR management

1.4 Objectives of the study

➢ Identification of the technique of performance appraisal in L&T construction
➢ Employee attitude towards the present appraisal system.
➢ To identify the effectiveness of the performance appraisal system for
employees.
➢ Identifying performance appraisal leading to the discovery of unfound talents
amongst the employees
➢ To provide suggestions and recommendations to improve the performance

appraisal effectiveness

1.5 Scope of the sturdy

➢ The study covers employees of L&T Construction

➢ A survey was conducted for information about the performance appraisal
system that was used in the company
➢ The study focuses on the type, efficiencies, and employee attitude of the
appraisal system.
➢ To help management plan future development and growth
➢ The sample size of 50 employees was selected at random from all
departments.

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1.6 Limitations of the sturdy

• The Company’s policy of not disclosing some data and information for
obvious reasons, would have been very much useful for the report.
• Few employees sometimes felt disturbed, as they were busy with their job.
• It is difficult to make information based on a rich report in a short period
• The sample size was restricted to 50 employees.
• The answers given by the respondents highly depend on their mood and
interest and thus the accuracy fluctuates sometimes.

CHAPTER 2
REVIEW OF LITERATURE

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2.1 REVIEW OF LITERATURE:

1) Venclova Katerina (2013) The article focuses on employee performance

appraisal methods used in Czech agricultural enterprises. The first section of the
article looks into the theoretical underpinnings of the term "formal appraisal" as
well as employee performance appraisal methodologies as described by Czech
and international experts. Furthermore, the paper provides staff performance
appraisal methodologies that are regarded relevant for agricultural enterprises in
the Czech Republic, based on a questionnaire study. The purpose of this paper is
to determine the current condition of formal employee appraisal in a sample
group of agricultural enterprises, as well as to investigate the relationships
between various qualitative qualities. Predetermined goal-based performance
appraisal, predefined standard outcome-based performance appraisal, and
assessment interviews are the most often utilised techniques of employee
performance review in agricultural enterprises, according to the findings.
Agricultural firms use these methods in particular because the results are
applied to other aspects of human resource management, such as the reward
system and staff planning. In statistical terms, the relationship between
agricultural organisations' approach of employee performance appraisal based
on predefined goals and personnel planning (a human resources management
area) has been established (p-value: 0.03, Phi coefficient: 4.578).

2) Ashima Aggarwal, Gour Sundar Mitra Thakur (2013)performed a

review of performance appraisal methods Ranking, Graphic Rating Scale,
Critical Incident, Narrative Essays, Management By Objectives, Assessment
Centers, BARS, 360 Degree, and 720 Degree are some of the performance
appraisal approaches discussed, as well as their benefits and drawbacks. The
traditional method of performance appraisal or the modern method of
performance appraisal are used by the organisations. Organizations utilise a

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performance appraisal system to assess the efficacy and efficiency of their
personnel. Because each individual approaches their task differently, a
performance appraisal system is required. Workplace performance,
communication objectives, estimating employee potential, and employee
counselling are all benefits of performance appraisal. After the research, the
authors came to the conclusion that determining whether methodology is better
than another is challenging because it relies on the nature and size of the
organisation. Each methodology has its advantages and disadvantages.

3) Peter R. Scholtes (1993)the research is based on a comparison of total

quality or performance appraisals. TQM and performance appraisal, according
to the author, are incompatible. Customer awareness, systems thinking, a grasp
of variance, teamwork appreciation, mastery of improvement methodologies,
and a comprehension of the process of personal motivation and learning are all
required for TQM. TQM's very requirements are thwarted by performance
appraisal. TQM necessitates that we comprehend, control, and improve
processes in order to benefit the consumer. The goal of performance appraisal is
to ensure that an individual's behaviour is controlled to the satisfaction of his or
her boss. Managers must choose between the two approaches: one or the other,
but not both.

4) Rocio de Andres (2010) looked into Distance function approaches are

used to evaluate performance. Some companies use performance appraisal to
analyse their employees' efficiency and production in order to plan their
promotion, wage, and layoff policies, among other things. Initially, only the
executive staff carried out this procedure, but it has since grown into an
evaluation process based on the opinions of many reviewers, supervisors,
collaborators, consumers, and the employees themselves (360-degree method).
Reviewers analyse several signs connected to an employee's performance
appraisal in such a process. The authors of this research proposed an evaluation

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system in which diverse groups of reviewers participate in the evaluation
process. Given that reviewers have varying levels of knowledge about the
employee being evaluated, it appears reasonable to provide a flexible
framework in which reviewers can express their opinions on multiple finite
scales based on their expertise. The ultimate goal is to create a global appraisal
for each employee that the management team may use to make decisions about
human resources strategy. In this way, the authors suggested a mechanism for
aggregating individual valuation in a framework measure in order to achieve a
global evaluation for each employee. The underlying optimization problems can
be simplified to a fairly simple Extended Goal Programming formulation in this
application.

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

Dale S. Beach, "Performance appraisal is a systematic evaluation of the

individual with respect to his or her performance on the job and his or her
potential for development”

Randall S Schhuler, "performance appraisal is formal structure system of

measuring and evaluating an employee's job-related behaviour and outcomes to
discover how and why the employee is presently perfuming on the job and how
the employee can perform more effectively in the future so that the employee,
organization and society all benefits."

Dale Yoder, "Performance appraisal includes all formal procedures used to

evaluated personalities and contributions and potentials of group members in a
working organization. It is a continuous process to secure information necessary
for making correct and objective decisions on employees."
Performance appraisal from an employee point of view-"A performance
appraisal is meant to help employees their strengths and shortcomings and
receive compensation accordingly."

Mcgreror (1957) suggested that, employees should be appraised on the basis of

short-term goals, rather than traits, which are jointly set by the employee and

the manager

H.C. Shiva Prasad (2010 done work to check the performance of Indian
software professionals (SPS) Data were collected from 441 software and senior

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software engineers from eight Indian software firms. The team leaders assessed
the performance of software and senior software engineers on 16 items. The
exploratory and confirmatory factor analyses of scores on 16 items of the
instrument suggest six dimensions of performance. They are work efficiency,
personal resourcefulness, inter- and intra-personal sensitivity, productivity
orientation, timeliness, and business intelligence. The dimensions have
reliability and high convergent validity. SPs having more years of experience,
higher need for achievement, and higher need for social power are high
performers. Human resource managers can evaluate the performance of SPS
holistically on six dimensions for training, reward administration, job rotation,
and promotion decisions.

2.2 Research Gap:

1. Lack of job knowledge.
2. Changing job requirements.
3. Lack of understanding of the role due to improper hiring.
4. Ineffective management.
5. Physical or emotional conditions in the workplace.
6. Leadership and structural problems within the organization.

2.3 Statement of the problem:

Problem 1. Differences among Raters:
Differences among raters in their evaluations of performance leads to
several errors. One is a dissimilarity in perception. Two raters observe an
employee disagreeing with a supervisor. One perceives this negatively as
insubordination. The other perceives it positively as a willingness to stand up for
what one believes.
Different value systems can also play a part in how raters can disagree.
One rater may feel that honest and ethical behaviour is paramount, no matter
what the effect on profits. Another may have a bottom-line orientation that says

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any behaviour including the blatantly dishonest is permissible so long as it
shows a profit

Problem 2. Confusing Performance and Potential:

Many rating systems that are supposed to be evaluating performance fall
into the trap of measuring potential as well. This is a serious mistake that can
unfairly penalize employees as well as give credit where it is not deserved.
Measurement of potential is often an important aspect of any appraisal system,
but the organization and the raters and the ratees involved need to be absolutely
clear on the difference.

Problem 3. Rating Game:

Performance appraisal methods either compare employees against one
another or compare employees against a standard. Within these two types there
are numerous methods of appraisal. Some are simple such as straight ranking.
Others are more complex, such as behavioural scales attempting to establish a
success criterion by defining performance behaviours. Whatever may be the
method, the rating procedure may become something like a game or contest.
Again, these methods lay emphasis on alikeness and conformity of human
performance and ignore measurement of human values.

The most common errors in evaluation are:

➢ Drawing the wrong conclusions about an individual’s capabilities based

on his performance and overemphasizing one or two attributes.

2.4 Significance of study

Performance appraisal is crucial tool in the hands of the management to

bring about greater agility and responsiveness in human resources of an
organization. Performance appraisal is the foundation of much human resource
decision.

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The focus of the performance appraisal is measuring and improving the
actual performance of the employee and also the future potential of the
employee. Its aim is to measure what an employee does. Performance
appraisals are regular reviews of employee performance within the organization.

Performance appraisal has three basic functions:

(1) To provide adequate feedback to each person on his or her

performance;

(2) To serve as a basis for modifying or changing behavior toward more

effective working habits;

(3) To provide data to managers with which they may judge future job
assignments

Performance improvement:
Performance feedback allows the employee, manager and personnel specialists
to intervene with appropriations to improve performance.

Compensation adjustments:

Performance evaluations help decision-makers determine who should receive

pay raises. Many firms grant part, or all pay increases and bonuses based upon
merit, which is determined mostly through performance appraisals.

Placement decisions:

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Promotions, transfers and demotions are usually based on past or anticipated
performance. Often promotions are a reward for past performance.

Training and development needs:

Poor performance may indicate the need for retraining. Likewise, good
performance may indicate untapped potential that should be developed.

Career planning development:

Performance feedback guides career decisions about specific career paths one
should investigate.

Staffing process deficiencies:

Good or bad performance implies strengths or Jaster Pal Sing the personnel
department's staffing procedures.

Informational inaccuracies:

Poor performance may indicate errors in job analysis information, human

resource plans, or other parts of the personnel management information system.
Reliance on inaccurate information may have led to inappropriate hiring,
training, or counselling decisions.

Job design errors:

Poor performance may be a symptom of ill-conceived job designs.

Appraisals help diagnose these errors.

Equal employment opportunity:

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Accurate performance appraisals that actually measure job elated performance
ensure that internal placement decisions are not discriminatory.

External challenges:

Sometimes performance is influenced by factors outside the work environment

such as family, financial, health, or other personal matters. If uncovered through
appraisals, the human resource department may be able to provide assistance.

Feedback to human resources:

Good/bad performance throughout the organization indicates how well the

human resource function is performing advertisements.

CHAPTER- 3
RESEARCH METHODOLOGY
3.1 Methodology Adopted

RESEARCH DESIGN

Research Design refers to or plan for a study that guides the collection and
analysis of data". A typical research design of a company basically tries to
resolve the following issues: Carlo

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 1. Determining Data Collection Design

2. Determining Data Methods

3. Determining Data Sources

4. Determining Primary Data Collection Methods

5. Developing Questionnaires

6. Determining Sampling Plan

(1) Explorative Research Design:

Explorative studies are undertaken with a view to know more about the
problem. These studies help in proper definition of the problem, and
development of specific hypothesis is to be tested later by more conclusive
research designs.

Its basic purpose is to identify factors underlying a problem and to determine

which one of them need to be further researched by using rigorous conclusive
research designs.

2) Conclusive Research Design:

Conclusive Research Studies are more formal in nature and are conducted with
a view to eliciting more precise information for purpose of making
These studies can be either: a)
Descriptive or
b) Experimental
Thus, it was a mix of both the tools of Research Design that is, Explorative as
well as conclusive.

3.2 Sources of data collection

Data Sources:

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 • Primary data
• Secondary Data through Internet
• Primary Data through Questionnaire
• Contact Method
• Personal Interaction
Primary data
• Direct personal observation
• Indirect oral interviews
• Information through manuals & websites
• Information through questionnaire filled by respondents
Secondary data.
Secondary data means that are already available they refer to the data which
have already been collected and analysed by someone else when the researcher
utilizes secondary data has to look into various sources where he can obtain. In
this case he certainly not confronted with the problems that are usually data nor
did unpublished data associate data associated with the collection of original
data secondary data may either be published.

3.3 Sampling methods

Sampling plan
Sampling method – Direct contact and questioner

Sample size = 50 Employees

3.4 Tools for analysis

TECHNIQUES / METHODS OF PERFORMANCE APPRAISALS

Numerous methods have been devised to measure the quantity and quality of
performance appraisals. Each of the methods is effective for some purposes for
some organizations only. None should be dismissed or accepted as appropriate
except as they relate to the particular needs of the organization or an employee.

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Broadly all methods of appraisals can be divided into two different categories.
Past Oriented Methods • Future Oriented Methods PAST ORIENTED
METHODS

1. Rating Scales:
Rating scales consists of several numerical scales representing job related
performance criterions such as dependability, initiative, output, attendance,
attitude etc. Each scales ranges from excellent to poor. The total numerical
scores are computed and final conclusions are derived.

Advantages - Adaptability, easy to use, low cost, every type of job can be
evaluated, large number of employees covered, no formal training required
Disadvantages - Rater’s biases

2.Checklist:

Under this method, checklist of statements of traits of employee in the form of

Yes or No based questions is prepared. Here the rater only does the reporting or
checking and HR department does the actual evaluation.

Advantages - Economy, case of administration, limited training required,

standardization.
Disadvantages - Raters biases, use of improper weighs by, does not allow rater
to give relative ratings.

3. Forced Choice Method:

The series of statements arranged in the blocks of two or more are given and the
rater indicates which statement is true or false. The rater is forced to make a
choice. HR department does actual assessment.

Advantages - Absence of personal biases because of forced choice.

Disadvantages- Statements may be wrongly framed.

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4. Forced Distribution Method:

Here employees are clustered around a high point on a rating scale. Rater is
compelled to distribute the employees on all points on the scale. It is assumed
that the performance is conformed to normal distribution.

Advantages – Eliminates
Disadvantages - Assumption of normal distribution, unrealistic, errors of
central tendency

5. Critical Incidents Method:

The approach is focused on certain critical behaviours of employee that makes

all the difference in the performance, Supervisors as and when they occur record
such incidents.

Advantages - Evaluations are based on actual job behaviours, ratings are

supported by descriptions, feedback is easy, reduces recency biases, chances of
subordinate improvement are high.

Disadvantages - Negative incidents can be prioritized, forgetting incidents,

overly close supervision; feedback may be too much and may appear to be
punishment.
6. Behaviourally Anchored Rating Scales:

Statements of effective and ineffective behaviours determine the points. They

are said to be behaviourally anchored. The rater is supposed to say, which
behavior describes the employee performance

Advantages - Helps overcome rating errors,

Disadvantages - Suffers from distortions inherent in most rating techniques.

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7. Field Review Method:

This is an appraisal done by someone outside the employees ' own department
usually the from corporate or HR department.

Advantages - Useful for managerial-level promotions, when comparable

information is needed.
Disadvantages- Outsider is generally not familiar with employees’ work
environment, and Observation of actual behaviors not possible.
Performance Tests & Observations: This is based on the test of knowledge or
skills. The tests may be written or an actual presentation of skills. Tests must be
reliable and validated to be useful.

8.Confidential Records:

Mostly used by government departments, however its application in industry is

not ruled out. Here the report is given in the form of Annual Confidentiality
Report (ACR) and may record ratings with respect to following items,
attendance self-expression, team work, leadership, initiative, technical ability,
reasoning ability, originality and resourcefulness etc. The system is highly
secretive and confidential. Feedback to the assesses is given only in case of an
adverse entry.

Essay Method:
In this method the raters write down the employee description in detail within a
number of broad categories like, overall impression of performance, promote
ability of employee, existing capabilities and qualifications of performing jobs,
strengths and weaknesses and training needs of the employee.

Advantage - It is extremely useful in filing information gaps about the

employees that often occur in a better - structured checklist.

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Disadvantages - It its highly dependent upon the writing skills of rater and most
of them are not good writers. They may get confused success depends on the
memory power of raters.

Cost Accounting Method:

Here performance is evaluated from the monetary returns yields to his or her
organization. Cost to keep employee, and benefit the organization derives is
ascertained. Hence it is more dependent upon cost and benefit analysis.

Comparative Evaluation Method (Ranking & Paired Comparisons): These are

collection of different methods that compare performance with that of other co -
workers. The usual techniques used may be ranking methods and paired
comparison method.

Ranking Methods:
Superior ranks his worker based on merit, from best to worst. However how
best and why host are not elaborated in this method. It is easy to administer and
explanation.

Paired Comparison Methods:

In this method each employee is rated with another employee in the form of
pairs
The number of comparisons may be calculated with the help of a formula as
under FUTURE-ORIENTED METHODS
Management by Objectives: It means management by objectives and the
performance is rated against the achievement of objectives stated by the
management. MBO process goes as under Establish goals and desired outcomes
for each subordinate. Setting performance standards Comparison of actual goals
with goals attained by the employee Establish new goals and new strategies for
goals not achieved in previous year.

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Advantage - It is more useful for managerial positions.
Disadvantages - Not applicable to all jobs, allocation of merit pay may result in
setting short - term goals rather than important and long - term goals etc.

Psychological Appraisals: These appraisals are more directed to assess

employee’s potential future performance rather than the past one. It is done in
the form of in - depth interviews, psychological tests, discussion with
supervisors and review of other evaluations. It is more focused on employees
emotional, intellectual, and motivational and other personal characteristics
affecting his performance. This approach is slow and costly and may be useful
for bright young members who may have considerable potential.

Assessment Centres:

Assessment centre is a central location where managers may come together to

have their participation in job related exercises evaluated by trained observers
Assesses are requested to participate in in - basket exercises work groups.
computer simulations, role playing and other similar activities which require
same attributes for successful performance in actual job. The characteristics
assessed in assessment centre can be assertiveness, persuasive ability,
communicating ability, planning and organizational ability, self-confidence,
resistance to stress, energy level, decision making, sensitivity to feelings,
administrative ability, creativity and mental alertness etc.

Advantages -well conducted assessment centre can achieve better forecasts of

future performance and progress than other methods of appraisals. Also,
reliability, content validity and predictive ability are said to be high in

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assessment centres. That also make sure that the wrong people are not hired or
promoted.

Disadvantages - Costs of employees traveling and lodging, psychologists,

ratings strongly influenced by assesses inter - personal skills. Solid performers
may feel suffocated in simulated situations. Those who are not selected for this
also may get affected.

360 - Degree Feedback:

It is a technique which is systematic collection of performance data on an
individual group, derived from a number of stakeholders like immediate
supervisors, team members, customers, peers and self. In fact, anyone who has
useful information on how an employee does a job may be one of the appraisers
This technique is highly useful in terms of broader perspective, greater self -
development and multi - source feedback is useful. 360-degree appraisals are
useful to measure inter - personal skills, customer satisfaction and team building
skills. However, on the negative side, receiving feedback from multiple sources
can be intimidating, threatening etc. Multiple raters may be less adept at
providing balanced and objective feedback.

3.5 Goals of performance appraisals Goals

of Performance Appraisals:
General Goals Specific Goals

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 Salary / performance
Administrative decision /uses
Retention / termination
Recognition
Lay off
Poor performance identification
Organizational Maintain
HR Planning
Training Needs
Organizational Goals Achievements
Goals identification
HR systems Evolution
Reinforcement of Organizational
Needs

Documentation

Validation research For

HR Decision

Advantages of Performance Appraisal:

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 It’s Said that performance appraisal is an investment for the
company which can be justified by the following advantage

Promotion:

Performance appraisal helps the supervisors to check out the

promotion programs for efficient employees. In this regard, inefficient workers
can be dismissed or demoted in case.

Compensation:

Performance appraisal helps in checking out compensation

packages for employees Merits rating is possible through performance appraisal,
performance appraisal tries to give worth to performance, compensation
packages which included bonus, high salary rates, extra benefits, allowance, and
pre- requisition are dependent on performance appraisal, the criteria should be
merit rather than seniority.

Employees development:

The Systematic procedure of performance appraisal helps the

supervisors to frame training policies and programs. It helps to analyse the
strengths and weaknesses of employees so that new jobs can be designed for
efficient employees. It also helps frame future development programs.

Selection validation:

Performance appraisal helps the supervises to understand the

validity and importance of the selection procedure, The supervisors come to

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know the validity and thereby selection procedure future changes in selection
methods can be made in
The supervisors come to know the validity and thereby the strength
and weakness of selection procedures future changes in selection methods

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1) The 360-Degree Appraisal

This method involves giving out a questionnaire with questions regarding a

colleague’s performance they need to fill it up. The manager can consider this
feedback by evaluating the performance at the end of the quarter/year.

2) General Performance Appraisal

This method involves continuous interaction between the employee and his
manager, continuous setting of goals, and achieving them. Whether the
employee has been able to do justice the entire process or not is evaluated at the
end of the year.

3. Technological/Administrative Performance Appraisal

This appraisal technique concentrates on technical more than any other aspect of
performance on the job as the employees involved have specialized skills.
They’re judged on the skills they possess and the activity they complete

4. Manager Performance Appraisal

A manager’s performance should also be appraised, and this includes not just
his/her performance on the job but also relationship management with clients at
his/her disposal. Generally, anonymous feedback forms are received, which are
then considered for appraisal.

5. Employee Self-Assessment
This method is very unpopular among employees as nobody can deal with rating
himself or herself. The self-assessment sheet is compared with the one filled up
by the manager and the differences are discussed.

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6. Project Evaluation Review

This method involves performance appraisal of the team members involved at

the end of every project and not at the end of every year. This helps the team
and its members develop with each passing project.

7. Sales Performance Appraisal

A salesperson is evaluated on the basis of his/her sales skills and

accomplishment of financial goals set previously. Goals set in case of sales
should be realistic and ways of achieving them should be decided by the
employee and the manager concerned.
Below are the different techniques of Performance Appraisal: Graphic
Rating Scale

A graphic rating scale rates employees on a fixed scale as per the qualities they
are required to possess. The final score obtained classifies employees into
various tiers and helps in their performance evaluation at the end of the year. It
is understandable and easily usable. Behaviours can be quantified, and appraisal
can be simplified using this method.

There are demerits to this method too. Temperament varies from person to
person. A few evaluators can be very strict, and a few can be very lenient based
on their fixed agenda. Though it helps to identify the best and the worst
performing individuals, it does not separate average individuals.

Essay Performance Appraisal Method

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It is also called the “Free Form method.” It includes a fact-based performance
description of employees with instances to support it and based on this; the s/he
is evaluated on the job. It is a qualitative technique and not a quantitative
technique. So, evaluation using this method is difficult. Moreover, one needs to
have detailed knowledge regarding the job and the firm in order to use this
method.

Checklist Scale

A checklist is prepared on the basis of Yes or No with regard to the traits of an

employee. If an employee has a particular trait, then it is marked as yes or else
no. The evaluation of the rate and the actual HR evaluation are two separate
things altogether, and it is not a detailed evaluation.

Critical Incidents

The manager must prepare a list of important incidents highlighting the

behaviour of an employee. These incidents help decide the best or the poorest
behaviour of an employee, and s/he is evaluated. The only disadvantage of this
method is it can be very biased.

Work Standards Approach

The management of a firm establishes fixed standards and the final deliverable
prepared by the team involved must be as per those points, and then, each
member is evaluated. So, the employee knows his/her job and its terms clearly.
It just does not help in making individualistic appraisals.

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Ranking Appraisal

A manager is required to rank employees put into the same job and then
evaluate them. The employees are ranked chronologically in either increasing or
decreasing order. The problem is it cannot be used on a very large team and its
members.

MBOs

MBO (management by objectives) involves setting objectives for the employees

on the job, which they have to accomplish and are further appraised on that
basis. SMART Goals i.e., Goals that are Specific, Measurable, Actionable,
Relevant, and Time-bound are set so that biased can be prevented.

Employee Evaluation:

Though often understated or even denied evaluation is a legitimate and major

objective of performance appraisal.
But the need to evaluate (i.e., to judge) is also an ongoing source of tension
since evaluative and developmental priorities appear to frequently clash. Yet at
its most basic level, performance appraisal is the process of examining and
evaluating the performance of an individual.
Though organizations have a clear right - some would say a duty to conduct
such evaluations of performance, many still recoil from the idea. To them, the
explicit process of judgment can be dehumanizing and demoralizing and a
source of anxiety and distress to.
It is said by some that performance appraisal cannot serve the needs of
evaluation and development.

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Performance appraisal process:

Establishing Performance Standards

Communicating standards and expectation

Measuring the actual performance

Comparing with standards

Discussing results (Providing Feedback)

Establishing Performance Standards

Role of Performance Appraisal in Training and Development:

Performance appraisal offers an excellent opportunity - perhaps the best that
will ever occur - for a supervisor and subordinate to recognize and agree upon
individual training and development needs.

During the discussion of an employee's work performance, the presence or

absence of work skills can become very obvious - even to those who habitually
reject the idea of training for them.

Performance appraisal can make the need for training more pressing and
relevant by linking it clearly to performance outcomes and future career
aspirations

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From the point of view of the organization as a whole, consolidated appraisal
data can form a picture of the overall demand for training. This data may be
analysed by variables such as sex, department, etc. In this respect, performance
appraisal can provide a regular and efficient training needs audit for the entire
organization.

Performance Appraisal and Recruitment and Induction:

Appraisal data can be used to monitor the success of the organization's
recruitment and induction practices. For example, how well are the employees
performing who were hired in the past two years?

Appraisal data can also be used to monitor the effectiveness of changes in

recruitment strategies. By following the yearly data related to new hires (and
given sufficient numbers on which to base the analysis) it is possible to assess
whether the general quality of the workforce is improving.

Staying steady, or declining.

Difference between traditional and modern(system) approach to appraisals

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 Modern, system
Categories Traditional appraisal appraisal

Individualistic, Systematic,
Guiding values controloriented developmental,
documentary problem solving

Leadership styles Directional evaluative Facilitative, coaching

Frequency Occasional Frequent

Formalities High Low

Rewards Individualistic Grouped,

organizational

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 CHAPTER- 4
DATA ANALYSIS AND
INTERPRETATION/RESEARCH AND
DISCUSSION

4.1 Analysis and interpretation

Performance Appraisal is an important aspect in the organization to
evaluate the employee’s performance. It helps in understanding the employee’s
work culture, involvement, and satisfaction. It helps the organization in deciding
on employee's promotions,transfersr, incentives, pay increases. During my
efforts to find out the position of performance appraisal at L&T
CONSTRATUTION, I took the support of a questionnaire. The employees
respond to the questions differently on the same issues even. It also revealed
that certain employees are not aware of the performance appraisal policy of
however, to make the findings more elaborate, explain it with the help of pic
charts. The pic - charts refer to each question and its finding separately.

Data Analysis

1. Are you satisfied with the present performance appraisal system ?

(a) Yes [ ] (b) No [ ] If No, then why

…………………………..

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 40 %
YES
NO
60 %

Interpretation:

More than half of the employees are satisfied with the present performance
appraisal system.

2. Do you think the present system is effective / better than the previous
appraisal system?
(a) Yes [ ] (b) No [ ]

30 %

YES
NO

70 %

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Interpretation: 70% of employees think that the current system (e-Map) is
better than the previous system (ACR) because earlier their result was
totally confidential and was not known to them.

2. Do you think the e-map system reduces biasness?

(a) Yes [ ] (b) No [ ]

40 %
YES
NO
60 %

Interpretation: 60% of the employees think that this system reduces biasness
because the KRA evaluation is transparent to each appraisee.

3. As an appraisee do you face any problem while selecting the KRAs? (a) Yes
[ ] (b) No [ ]

20 %

YES
NO

80 %

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 Interpretation: 80% executives have no problem in selecting the
KRA‟s because everything is completely elaborated and they are given
choices to choose among many of their caliber.

4. Does your appraiser help you in selecting the KRAs? (a) Yes [ ] (b)
No [ ]

15 %

YES
NO

85 %

Interpretation: 85% executives are helped by their appraisers in selecting

KRA‟s. This shows the good inter personal relationship between the
appraisee and the appraiser.

5. Do you think the present list of KRAs cover all aspect of your job?
(a) Yes [ ] (b) No [ ]

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 25%

YES
NO

75%

Interpretation: Only 25% executives feel that the present list of KRA‟s
doesn’t cover all aspects of their job. The Executives which are under
grade E1- E3 are unsatisfied.

6. Do you think the system should be transparent to an appraisee?

(a) Yes [ ] (b) No [ ]

Interpretation: More than 65% of appraisers feel that

should not be transparent to an appraisee as this is the only
part through which they can control the performance of
their subordinates.

7. Do you get any formal feedback regarding your performance?

(a) Yes [ ] (b) No [ ]

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 30 %

YES
NO

70 %

Interpretation: 70% executive says that they get the formal feedback
regarding their performance by their superiors regularly while carrying
out their work.

8. Are any steps taken to improve the performance if not up to the mark?
(a) Yes [ ] (b) No [ ]

If yes, then what ………………………………………….

Interpretation: 30% of executives say that the proper training is given to them
for upgrading their job whenever required.
9. Do you find these steps effective / useful in your job?

Yes [ ] (b) No [ ]

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 35%
YES
NO
65%

Interpretation: 65% of executive feels that these steps are useful as they
develop their skills and competencies.

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