A

SUMMER INTERNSHIP PROJECT REPORT

ON

“PERFORMANCE APPRAISAL”

AT

INVESTORS CLINIC.
Submitted for partial fulfillment of requirement for the award of degree
Of
Masters Of Business Administration
Doranda College, Ranchi
(Session 2021-2023)

Supervision By Submitted By
DR. RAJMANI PANDEY STEPHAN LAKRA

FACULTY OF MBA 21MBA01101

MBA III SEMESTER

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 DECLARATION
I undersigned solemnly declare that the report of the project work entitled

“PERFORMANCE APPRAISAL”” is based my own work carried out during the

course of my study under the supervision of Dr. RAJMANI PANDEY.

I assert that the statements made and conclusions drawn are an outcome of the
project work. I further declare that to the best of my knowledge and belief that the
project report does not contain any part of any work which has been submitted for
award of any other degree/ diploma/certificate in this University or any other
University.

(Signature of the candidate )

STEPHAN LAKRA

Roll No.: 21MBA01101

MBA III SEMESTER

2
 CERTIFICATE

This is to certify that the report of the project submitted is the outcome of the project work

entitled “PERFORMANCE APPRAISAL””carried out by STEPHAN LAKRA bearing

Roll No.: 14 & University Roll No.- 21MBA01101 carried by under my guidance and
supervision for the award of Degree in Master Of Business Administration of Doranda
College, Ranchi, Jharkhand.

To the best of the my knowledge the report

I. Embodies the work of the candidate himself.

II. Has duly been completed.

III. Fulfils the requirement of the ordinance relating to the MBA degree of the
University and

IV. Is up to the desired standard for the purpose of which is submitted.

(Signature of the Internal Examiner) ( Signature of co-odinator)

3
(Signature of External Examiner)

4
5
 ACKNOWLEDGEMENT

In the present world of cutthroat competition project is likely a bridge between

theoretical and Practical working. The satisfaction and euphoria the accompany the
successful completion of the work would be incomplete unless I mention the people, as
an expression of gratitude, who made it possible and whose constant guidance and
encouragement served as a beacon of light and crowned our efforts with success. This
report would have been impossible but for the support and guidance that I received
from various people at different stages of the project.

I am extremely indebted Prof. Dr. RAJMANI PANDEY in RANCHI college of Masters of

Business Administration department providing enthusiastic guidance to made project
well.

Last but not the least I express my sincere thanks to the entire team for providing me
their time and active co-operation and all who helped my directly or indirectly in this
project

(Signature of the student)

STEPHAN LAKRA

21MBA01101

MBA III Semester

6
 CONTENTS

SERIAL NAME OF THE TOPIC PAGE NO:

NO.
1. INTRODUCTION 7-14

2. REVIEW OF LITERATURE 15-18

3. RESEARCH METHODOLOGY 24-44

4. DATA ANALYSIS 45-50

5. FINDING /SUGGESTIONS 51-52

6. CONCLUSIONS 53

7. BIBLIOGRAPHY 54

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 INTRODUCTION

Performance Appraisal is a process of evaluating an employee’s performance in terms of its

requirements.

Performance Appraisal can also be defined as “the process of evaluating the performance and

qualifications of the employees in terms of the requirements of the job for which he is

employed, for purposes of administration including placement, selection for promotions,

providing financial rewards and other actions which require differential treatment among the

members of a group as distinguished from actions affecting all members equally”.

This article’s focus on the US workplace. Organizations can benefit from performance

appraisal offering diversity training to employees. That is, training employees to respect others

and not to act in a discriminatory manner towards fellow employees.1

This article presents two models of mentoring. The traditional view of mentoring is facilitated

mentoring where the more experienced person (mentor) acts as a role model for the less

experienced person (mentee). Another approach is also offered – guided learning. A more

experienced co-worker uses guided learning to teach a less experienced worker new skills.2.

This paper outlines the experiences of two executive women in developing an internal

mentoring program. The experiences demonstrate that the mentoring relationship not only

benefits the mentees but also the mentor.3

While the increased demand for executive coaching in the marketplace has opened up, the

increasing number of coaches of every type, training, and perspective has also grown .It is

surprising that with the increased use of executive coaching and the rising number of coaches,

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there has not been a professional association formed to develop and monitor the standards,

requirements, and competency validation solely for executive coaches . This need has brought

reactions from executives, coaches, and clients who suggest standardized methods.

Executives have recognized the significance of executive coaching in their professional

performance, both personally and organizationally. During the beginning years of executive

coaching, it was seen as an executive crutch to assist non-performers. Today, executive

coaching is looked upon as a necessary tool and in some cases reserved only for senior

executives. One reason for the about face attitude could be the value executive coaching

brings as a "time-out" break, from the unyielding demands of the corporate world, for inner

thought, assessment, positive criticism, and a co-development of strategies .One of the premier

uses of executive coaching is to deliver "just-in-time" strategies for increasing one's personal

performance and effectiveness by transforming weaknesses into strengths. Due to this increase

in personal ROI, corporate America is enamored with executive coaching and the benefits it

has brought in recent years.

With many corporate incomes decreasing over the past few years, corporations have

reevaluated their training and development practices, to include the use of external sources .As

a result, executive coaching focuses on ensuring alignment with corporate strategy. In this

changing corporate setting, executive coaching must be used in a laser-focused manner, rather

than a liberally used improvised solution. Those corporations who have identified the need and

usefulness of executive coaching have created an inner coaching environment to facilitate

coaching through internal coaches.

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It is in the new corporate coaching culture of companies employing their own coaches

(internal) where the chemistry of the coaching relationship takes a back seat to replicable

measures in the coaching protocol (Joo, 2005; Kampa -Kokesh & Anderson, 2001; Stevens,

2005; Turner, 2006; Wasylyshyn, 2003). The internal coach, unfortunately, finds him or

herself in a dilemma of possibly losing one of his most prized outcomes, which is, assisting

clients to become masters of change management. Another downturn of this

"commoditization" of executive coaching is to put a limit on the use of coaching, and to what

extent, documenting the benchmarks, stages, and action steps. Doing so, realistically,

diminishes the coaching process to a cookie cutter approach including a preset number of

sessions and strategies rather than a co- developed strategic plan developed over the course of

an ongoing relationship.

USES OF PERFORMANCE APPRAISAL

For many organizations, the primary goal of an appraisal system is to improve individual and

organizational performance. There may be other goals, however. A potential problem with PA,

and a possible cause of much dissatisfaction, is expecting too much from one appraisal plan.

For example, a plan that is effective for developing employees may not be the best for

determining pay increases. Yet, a properly designed system can help achieve organizational

objectives and enhance employee performance. In fact, PA data are potentially valuable for

virtually every human resource functional area.

i. HUMAN RESOURCE PLANNING:

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 In assessing a firm’s human resources, data must be available to identify those who have the

potential to be promoted or for any area of internal employee relations. Through performance

appraisal it may be discovered that there is an insufficient number of workers who are

prepared to enter management. Plans can then be made for greater emphasis on management

development. Succession planning is a key concern for all firms. A well-designed appraisal

system provides a profile of the organization’s human resource strengths and weaknesses to

support this effort.

ii. RECRUITMENT & SELECTION:

Performance evaluation ratings may be helpful in predicting the performance of job

applicants. For example, it may be determined that a firm’s successful employees (identified

through performance evaluations) exhibit certain behaviors when performing key tasks. These

data may then provide benchmarks for evaluating applicant responses obtained through

behavioral interviews. Also, in validating selection tests, employee ratings may be used as the

variable against which test scores are compared. In this instance, determination of the

selection test’s validity would depend on the accuracy of appraisal results.

iii. TRAINING AND DEVELOPMENT:

Performance appraisal should point out an employee’s specific needs for training and

development. For instance, if Pat Compton’s job requires skill in technical writing and her

evaluation reveals a deficiency in this factor, she may need additional training in written

communication. If a firm finds that a number of first-line supervisors are having difficulty in

administering disciplinary action, training sessions addressing this problem may be

appropriate. By identifying deficiencies that adversely affect performance, T&D programs

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 can be developed that permit individuals to build on their strengths and minimize their

deficiencies. An appraisal system does not guarantee properly trained and developed

employees. However, determining T&D needs is more precise when appraisal data are

available.

iv. CAREER PLANNING AND DEVELOPMENT:

Career planning is an ongoing process whereby an individual sets career goals and identifies

the means to achieve them. On the other hand, career development is a formal approach used

by the organization to ensure that people with the proper qualifications and experiences are

available when needed. Performance appraisal data is essential in assessing an employee’s

strengths and weaknesses and in determining the person’s potential. Managers may use such

information to counsel subordinates and assist them in developing and implementing their

career plans.

v. COMPENSATION PROGRAMS:

Performance appraisal results provide a basis for rational decisions regarding pay adjustments.

Most managers believe that you should reward outstanding job performance tangibly with pay

increases. They believe that the behaviors you reward are the behaviors you get. Rewarding

behaviors necessary for accomplishing organizational objectives is at the heart of a firm’s

strategic plan. To encourage good performance, a firm should design and implement a reliable

performance appraisal system and then reward the most productive workers and teams

accordingly.

vi. INTERNAL EMPLOYEE RELATIONS:

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 Performance appraisal data are also used for decisions in several areas of internal employee

relations, including promotion, demotion, termination, layoff, and transfer. For example, an

employee’s performance in one job may be useful in determining his or her ability to perform

another job on the same level, as is required in the consideration of transfers. When the

performance level is unacceptable, demotion or even termination may be appropriate.

vii. ASSESSMENT OF EMPLOYEE POTENTIAL:

Some organizations attempt to assess an employee’s potential as they appraise his or her job

performance. Although past behaviors may be a good predictor of future behaviors in some

jobs, an employee’s past performance may not accurately indicate future performance in other

jobs.

IMPORTANCE AND PURPOSE OF PERFORMANCE APPRAISAL

Performance Appraisal has been considered as the most significant an indispensable tool for an

organization, for the information it provides is highly useful in making decisions regarding

various personnel aspects such as promotion and merit increases. Performance measures also link

information gathering and decision making processes which provide a basis for judging the

effectiveness of personnel sub-divisions such as recruiting, selection, training and compensation.

Accurate information plays a vital role in the organization as a whole. They help in finding out

the weaknesses in the primary areas.

Formal Performance Appraisal plans are designed to meet three needs, one of the organization

and the other two of the individual namely:

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 a) They provide systematic judgments to back up salary increases, transfers, demotions or

terminations.

b) They are the means of telling a subordinate how he is doing and suggesting needed

changes in his behavior, attitudes, skills or job knowledge. They let him know where he

stands with the Boss.

c) Superior uses them as a base for coaching and counseling the individual.

On the basis of merit rating or appraisal procedures, the main objectives of Employee Appraisal

are:

a) To enable an organization to maintain an inventory of the number and quality of all

managers and to identify and meet their training needs and aspirations.

b) To determine increment rewards and to provide reliable index for promotions and

transfers to positions of greater responsibility.

c) To suggest ways of improving the employee s performance when he is not found to be up

to the mark during the review period.

d) To identify training and development needs and to evaluate effectiveness of training and

development programs.

e) To plan career development, human resource planning based potentials.

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AADVANTAGES AND DISADVANTAGES OF PERFORMANCE APPRAISAL

ADVANTAGES: DISADVANTAGES:

1. They provide a document of 1. If not done right, they can create a

employee performance over a negative experience.

specific period of time. 2. Performance appraisals are very time

2. They provide a structure where a consuming and can be overwhelming

manager can meet and discuss to many manager with many

performance with an employee. employee.

3. They allow a manager the 3. They are based on human assessment

opportunity to provide the employee and are subject to rater errors and
with feedback about their biases.
performance and discuss how well 4. Can be waste of time if not done
the employee goals were appropriately.
accomplished. 5. They can create a very stressful
4. They provide a structure process for
environment for everyone involved.
an employee to clarify expectation

and discuss issues with their

managers.

5. They provide a structure for thinking

through and planning the upcoming

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 year and developing employee goals.

REVIEW OF LITERATURE

Effectiveness of performance Appraisal system it is argued is a function of applying the right

system in right context. By Klein; The Art of Appraisal

Performance appraisal system are “home work” that provides the information you need in

order to make appropriate administrative recommendations, hold meaningful

feedback d i s c u s s i o n s   w i t h   s t a f f   m e m b e r s ,   a n d   d e t e r m i n e d   w e r e   p e r f o r m a

n c e   i m p r o v e m e n t   i s require By Marion E. Haynes; Managing Performance

The effectiveness of an Appraisal System is determined by the quality of

communication between the manager and staff member, not by multiple raters, complex

scoring methods, or the form used.By John D. Drake; Performance Appraisal: One More

Time

Performance appraisal can actually be counter-productive for employees who

are in the greatest need of training and further development By Victor Buzzottan;

Improving your Performance Appraisal 

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One of the measure reason Performance management and Performance Appraisal fail is that

too much time is spent on Appraising performance using vague criteria, and not

enough time and effort put into helping employee understand what his job is

about, and the goals and objectives he/she is expected to achieve to be successful. Learn to

do goals setting painlessly.

 By Robert Bacal; Learn to plan Performance and set employee goals

Maximizing and measuring our own performance and that of the people who work for us is

a basic tenant of the work environment. Always use of simple tool and approach that can be

beneficial in achievement performance plan.

By Zack Mansdorf; Performance Management; Identifying work goals

Most managers and supervisors today are attempting to quantify their d

e p a r t m e n t a l objective and pass them on their employees through performance standards.

Despite the simplicity of this management- by –objective approach, deadlines are missed,

quality is relatively poor and productive is low. The reasons for this may not be

the fault of the employees carrying out the work. The cause is most often associated with

the immediate supervisor’s lack of attention to the realities surrounding objectives

and performance standards require a careful analysis of all the relevant issues.

By Gregory Isaac; Plan for performance

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 COMPANY PROFILE
INVESTORS CLINIC:-

INVESTOR’S CLINIC is an Indian financial consultant and career developer company

based in Ranchi, Jharkhand, establish in year 2016. Found by ABHISHEK DAS.

Mission as a financial consultant :

INVESTOR’S CLINIC assist to attain FINANCIAL LITERACY by providing basic

financial awareness, financial consultancy and portfolio management services.
Investor’s clinic is a one stop solution to all financial product under a single
umbrella.

Role as a Career Developer:-

We focus on development of student and thereafter leading to quality placement.

Transformer is a hub for students to experience corporate culture through our
placement oriented certification programs aiming at their personal, professional and
profile development.

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FINANCIAL SERVICE

A financial service is not the financial good itself—says a mortgage loan to buy a
house or a car insurance policy—but something that is best described as the process
of acquiring the financial good. In other words, it involves the transaction required
to obtain the financial good.

The 4 most common types of financial institutions are commercial banks, brokerage
firms, insurance companies, investment banks. Varied financial services are offered
by financial institutions, such as, currency exchange, investments, deposits, loans
etc. The two main categories of financial institutions are non-depository institutions,
and depository institutions. To facilitate transactions between sellers and buyers is
the main role of brokerage firms.

METHODS OF APPRAISAL IN INVESTOR’S CLINIC

Numerous methods have been devised to measure the quantity and quality of

employee’s job performance. Broadly all the approaches to appraisal can be classified into:

1. Past oriented methods,

2. Future oriented methods.

Each group has several techniques for appraising employee’s performance

 
PAST-ORIENTED

 Rating scales
 Checklist
 Forced choice method
 Forced distribution method
 Critical incident methods
 Behaviorally anchored scales

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  Performance tests and observations 
 Annual confidential
 Reports Essay methods
 Cost accounting approach
 Comparative evaluation approach 
 

RATING SCALES
This is the simplest and most popular technique for appraising employee

performance. The typical rating scale system consists of several numerical scales, each

representing a job-related performance criterion such as dependability, initiative, output,

attendance, attitude, co-operation, and the like. Each scales ranges from

excellent to poor. The rater checks t h e   a p p r o p r i a t e  performance level on

each criterion, then computes the employee’s total numerical scores.

CHECKLIST

Under this method, a checklist of statement on the traits of employee

a n d h i s o r   h e r   j o b i s  prepared in two columns-viz, a ‘Yes’ column and a ‘No’

column. All that the rater (immediate superior) should do is tick the ‘Yes’

column if the answer to the statement is positive and in column ‘No’ if the answer is

negative. After ticking off against each item, the rater forwards the list to the HR

department where the actual assessment of the employee takes place. The

HR department assigns certain points to each ‘Yes’ ticked.

FORCED CHOICE METHODS

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In this the rater is given a series of statements about an employee. These statements are

arranged in blocks of two or more, and the rater indicates which statements are most or least

descriptive of the employee. This method is known as the forced choice methods because the

rater is forced to select statements which are readymade.

FORCED DISTRIBUTION METHOD

One of the errors in rating is leniency-clustering a large number of employee around a high

point on a rating scale. The forced distribution method seeks to overcome the problem by

compelling the rater to distribute the rates on all points on the rating scale. The

method operates under an assumption that the employee performance level

conforms to a normal statistical distribution. Generally it is assumed that employee

performance level conforms to a bell-shaped curve.

CRITICAL INCIDENTS METHOD

The critical incidents methods of employee assessment have generated a lot of

interest these d a y s . T h e a p p r o a c h f o c u s e s o n c e r t a i n c r i t i c a l b e h a v i o r s o f

a n e m p l o y e e t h a t m a k e a l l t h e difference between effective and non-effective

performance of a job. Such incidents are recorded by the superiors as and when they occur.

BEHAVIORALLY ANCHORED RATING SCALES

Behaviorally anchored scale, sometimes called behavioral expectation scales, are

rating scales whose scale points are determined by statements of effective and ineffective

behaviors. They are said to be behaviorally anchored in that the scales represent a range of

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descriptive statements of behavior varying from the least to the most effective. A

rater must indicate which behavior on each scale best

describes man employee’s performance. Behaviorally anchored rating sc

a l e s (BARS) have the following features:

 Areas of performance to be evaluated are identified and defined by the people who

will use the scales.

 The scales are anchored by descriptions of actual job behaviors 

that, supervisors agree, represent specific level of

performance. The result is a set of rating scales in which both

dimensions and anchors are precisely defined.

 All dimensions of performance to be evaluated are based on observable

behaviors and are relevant to the job being evaluated since BARS are tailor

made for the job.

 Since the raters who will actually use the scales are actively involved

in the development process, they are more likely to be committed to the final

product.

 BARS were developed to provide results which subordinates could use to improve

performance. Supervisors would feel comfortable to give feedback to the ratees.

FIELD REVIEW METHOD

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This is an appraisal by someone outside the assesse’s own department, usually someone from

the corporate office or the HR department.  The outsider reviews employee  records

and hold sinter views with the rate and his or her superior. The method is used for making

promotional decision at the managerial level.

PERFORMANCE TESTS AND OBSERVATIONS

With a limited number of jobs, employee assessment may be based upon a test of knowledge

or skills. The test may be of the paper-and-pencil variety or an actual demonstration of skills.

The test must be reliable and validated to be useful. Even then, performance tests are apt to

measure potential more than actual performance

CONFIDNTIAL RECORDS

Confidential records are maintained mostly in government departments, though its application

in the industry is not ruled out., for example had followed method for a long time

called the Annual Confidential Report (ACR); The approach has 14 items:-

1 . Attendance

2. Self-expression (written or oral)

3. Ability to work with others

4. Leadership

5. Initiative

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6. Technical ability (job knowledge)

7.  Ability to understand new material

8.  Ability to reason

9.  Originality and resourcefulness,

10.  Areas of work that suits the person best,

11. Judgment

12. Integrity

13. Responsibility, and

14. Defect-indebtedness, memo served, etc.

Twelve of these were filled on a four point grade scale (Excellent, Good, Fair, Poor). For

integrity, there were special instructions from the management. 

Justification was separately given

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 RESEARCH METHODOLOGY

Aim of the Research

‘To ascertain the effectiveness of the method of Performance Appraisal used by the

organization’.

Research is the systematic process of collecting and analyzing data in order to

increase our understanding of the phenomenon about which we are concerned
or interested. It is the in- depth search for knowledge. It is a careful
investigation or inquiry especially through search for new facts in any branch
of knowledge. The study exhibits both descriptive and analytical character.
Regarding the theoretical concept it is descriptive since it interprets and
analysis the secondary data in order to arrive at appropriate conclusion, it is
also analytical in character. The interpretation of data is done based on ratio
and percentage.

OBJECTIVE OF THE STUDY

Main objective for the study of Performance Appraisal in INVESTOR’S CLINIC are as

follows:-

 To develop my understanding of the subject: Performance Appraisal System

implemented in various Organizations varies according to the need and suitability.

Through my research, I have tried to study the kind of Appraisal used in the Organization

and the various pros and cons of this type of system.

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  To conduct a study on social behavior: Social behavior is a very unpredictable aspect of

human life but social research is an attempt to acquire knowledge and to use the same for

social development.

 To enhance the welfare of employees: The Appraisal system is conceived by the

Management but mostly does not take into consideration the opinion of the employees.

This can lead to adverse problems in the Organization. Therefore by this study I have

attempted to put forth the opinion of the employee with respect to the acceptability of the

Performance Appraisal System.

 To exercise social control and predict changes in behavior: The ultimate object of my

research is to make it possible to predict the behavior of individuals by studying the

factors that govern and guide them.

Research Design
A research design is a type of blueprint prepared on various types of blueprints

available for the collection, measurement and analysis of data. A research design

calls for developing the most efficient plan of gathering the needed information. The

design of a research study is based on the purpose of the study.

A research design is the specification of methods and procedures for acquiring the

information needed. It is the overall pattern or framework of the project that

stipulates what information is to be collected from which source and by what

procedures.

Sampling

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An integral component of a research design is the sampling plan.

Specifically, it addresses three questions

Whom to survey (The Sample Unit)

How many to Survey (The Sample Size) &

How to select them (The Sampling

Procedure)

Making a census study of the whole universe will be impossible on the account of

limitations of time. Hence sampling becomes inevitable. A sample is only a portion of

the total employee strength. According to Yule, a famous statistician, the object of

sampling is to get maximum information about the parent population with minimum

effort.

Methods of Sampling
 Probability Sampling: Also known as random sampling or chance sampling.

Under this sampling design every individual in the organization has an equal

chance, or probability, of being chosen as a sample. This implies that the

section of sample items is independent of he persons making the study

that is, the

sampling operation is controlled objectively so that the items will be chosen

strictly at random.

 Non Probability Sampling: Also known as deliberate sampling , purposeful

and judgmental sampling. Non-Probability Sampling is that which does not

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 provide every individual in the Organization with a known chance of being

included in the sample.

Sampling Plan

i) Sample Method : Non-Probability

Sampling
(Convenience
Sampling)

ii) Sample Size : 50

iii) Sample Unit : Employees who do not

hold a supervisory
position

Sampling Design
Convenience Sampling, as the name implies, is based on the convenience of the

researcher who is to select a sample. Respondents in the sample are included in it

merely on account of their being available on the spot where the survey was in

progress.

Data collection method

Collection of data is the first step in statistics. The data collection process follows

the formulation for research design including the sample plan. The data can be

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secondary or primary.

Collection of Primary Data during the course of the study or research can be

through observations or through direct communication with respondents on

one form or another or through personal interviews. I have collected primary

data by the means of a Questionnaire. The Questionnaire was formulated

keeping in mind the objectives of the research study.

Secondary data means data that is already available i.e., they refer to data,

which has already been collected and analyzed by someone else. When a

secondary data is used, the researcher has to look into various sources from

where he can obtain data. This includes information from various books,

periodicals, magazines etc.

Research Methodology Adopted

Research Design : Descriptive research Research

Instrument : Structured Questionnaire

Source of Data
a) Primary Data : Structured Questionnaire

b) Secondary Data : Journals, Booklets, Company Data, etc.

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 LIMITATIONS OF THE STUDY

 Time limit of six weeks is not enough to study the activities of the entire organization.

 Sensitive information cannot be used for this study.

 Little time provided by the employees as they were busy.

 Lack of experience from my side toward such work.

RESEARCH METHODOLOGY FOR MY PROJECT

TYPE OF RESEARCH DESGIN: Descriptive

SAMPLE SIZE: 50

SAMPLE UNIT: Executive and non-executive

SAMPLE AREA: Karamtoli, Jail Road, Ranchi, Jharkhand

DATA COLLECTION

Primary data- In Investors Clinic Primary data & information have been
collected through questionnaire. A set of questionnaire was prepared with well
structured questions.

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 Secondary data- Secondary data were collected from books, website and
annual reports and official records of the Investors Clinic .

SAMPLING METHOD: Survey was done by QUESTIONNARE method.

SAMPLE AREA: RANCHI

SAMPLE UNIT: Officials and Employees of Investors Clinic

OBJECTIVES OF PERFORMANCE APPRAISAL

Sl. GENRAL APPLICATION SPECIFIC PURPOSES

No.
1. Developmental uses Identification of individual needs
Performance feedback Determining
transfer and job Assignments
Identification of individual

2. Administrative uses Decisions Salary Promotion Retention

of termination Recognition of
individual Performance Lay-offs
Identification of poor Performers

3. Organizational maintenance objectives HR Planning Determining organization

Training needs Evaluation of
organizational goal Achievement
Information of goal identification
Evaluation of HR systems
Reinforcement of organizational
Development needs

4. Documentation Criteria for validation Documentation for HR decisions

Helping to meet legal requirements

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TWO TYPES OF PERFORMANCE APPRAISAL IN INVESTOR’S CLINIC EMPLOYEES

1. PRIDE FOR EXECUTIVE

2. ACR FOR NON-EXECUTIVE

THE APPRAISAL PROCESS (ACR) FOR NON-EXECUTIVE

The  process  of appraisal  begins  with  the  establishment  of a

performance  s tandard.   Thes e  performance standards should be clear and objective

enough to be understood and measured. The next step is to communicate these standards to the

employees. To make the communication effective, ‘feedback is necessary from the

subordinate to the manager. After this, the  third  step  in  the  apprais al

proces s  are  the   meas urement  of  performance.  This  step  is concerned with the

decision on appraisal method and implementation of the system selected. The fourth steps in

the comparison of actual performance with standards. At the next step, the results of

appraisal are discussed periodically with the employees, where strength, weakness and

difficulties are discussed so that performance can be improved. The final step is the initiation

of corrective action whenever necessary (outstanding, Very good, Average, Poor),

again with justification for rating as outstanding or   poor. Recommendations for

promotion were also given. The ACR contained recommendations and signature of

the rater, the head of the department and the CMD. The system was highly secretive and

confidential. Feedback to the assesses was given only in case of an adverse entry.

32
 The ACR was highly subjective. Ratings were easily manipulated  because the

evolution was linked to promotion. Even ITI has discontinued this system for these reasons

METHODS OF IMPROVING PERFORMANCE APPRAISAL

1. Use Behaviour Based Scales:-

The BARS should be used instead of traits or personality attributes for appraisal.

2. Combine individual and group ranking:-These are the methods of classifying employees in

various grades and indicate position of each

employee in their respective in their grades. This will also reveal the 

n a t u r e   ( s t r i c t   o r   relaxed) raters and might help to correct them.

3. Continuous feedback:-

If the superior and worker interact often and confront problems, solution and

performance, annual appraisal will not be a surprise to the subordinate. A sort of

partnership can develop where supervisors continuously appraises him the areas requiring

improvement.

4. Multiple Raters:-

Uses of multiple raters minimize raters error discussed above. This can also assist to

employ suitably qualified and competent rater to appraise a person in

specialized areas. This latter  method is also called “Selective Rating Method”.

33
 5. Training Appraise/Raters:-

Suitable training assists a lot to bring in uniformity in criteria and measurement of

performance.

6. Peer Evaluation:-

Here, peers are asked to evaluate their colleagues and suitable weight age is assigned.

6. Rewards to Accurate Appraise/Raters:

This will provide the following1. Improve motivation to become objective in appraisal.2.

Improve value of appraisal. Very often raters consider, rating is a routine affair which has

“no value” on career  prospect / promotion etc. of employees.

Constraints:

 Non–availability of equipment: Inadequate delegation power.: Long geographical distance.:

Communication net- work is weak.: Office records are inadequate and traceable.: Inadequate

laboratory facilities/ support.: Voluminous back –log/untrained staff.

Opportunities:

34
Equipment/P&M new: Well trained personnel.: Proximity to industrial city.: Infrastructural

support.: Peer group support.: New vistas of challenge.

Development:

This means new processes, system procedure which are developed and adopted. Only one

item would be more than adequate. For example, reference may be made about

news y s t e m   f o r   c o m p i l i n g   a c c o u n t s   o n   t i m e ,   s t a n d a r d i z a t i o n   o f   e q u

i p m e n t ,   n e w   s y s t e m   o f   maintenance, safety and new mining methods etc: In respect

of development of people mention name of one or two subordinates who were motivated to

their working may be listed indicating specially the manner in which it was done.

Special Achievements:

Mention may be made about the earnestness with results were achieved, for example these

could be listed. Preparation of operation manual-Absorption of new technology-Substantial

increase in equipment utilization-Staff deployment/retraining-Designing new information

system-Substantial equipment re-habilitation- Improvement in quality of coal and

sales realization

Special Interest:

 Mention may be made of the Appraiser’s professional interest which may be even not related

to the job entrusted to him. These could be in respect of writing, reading, cultural activities,

sports etc.: In the matter of social managerial dimension has to be made about the

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 contribution of the executives in developing the social organization in the

company including contribution to activities outside the company. The Appraiser

has to make his observation by indicating G (Good) ,N(Normal),and P(poor).

Special Instructions

In respect of Development needs of an executives reference be made about areas

of training which would help the executives to grow further in his career, and

these may be indicated in terms of topics in respect of managerial skills and technical

skills. Job rotation of the executives as a means of his further development and career growth

is indicated.

General instructions

In all case where the grading are Outstanding, Very good, and E (below average),

the Appraise m u s t m e n t i o n s p e c i f i c a l l y t h e e v e n t t o s u p p o r t h i s v i e w s i n

t h e c o l u m n p r o v i d e f o r c r i t e r i a incidents; otherwise it will be considered subjective.

Mere achievements of targets or marginal raise over it do not signify

outstanding /very good performance. Remarks like “hard working and honest” also do not

merit a grade of “very good or outstanding”. (Strike out column not applicable)

1. FOR NON-EXECUTIVE

1. Name of Employee ……………………………………………………

2. Date of Birth …………………………………………………

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3. (a)Designation……………………………………

(b) Grade ……………………………………………………

(c) Nature of Duties……………………………………………………………

4. Educational Qualification………………………………

5. Date of joining the Dept………………………………………………………

6.Preceding Dept/Section of Posting…………………………………………

7. Period for which the employee has worked Under the Reporting Officer in the

year……………………………………………

ASSESSMENT BY THE REPORTING OFFICER 

8. Professional/technical general “Very Good”  “Good”  “Poor” Knowledge and application

9. If Supervisor:

(a) Capacity to plan, organize and execute

(b) Delegating duties to and taking work from subordinates exercising effective Supervision

and control, maintenance of discipline and leadership

10. Does he/she rise to occasion? Yes No

11. Cost consciousness? Yes No

12. Punctuality and regularity in attendance Punctual Irregular 

13. Industry and aptitude for work “Very Good” “Good” “Poor”

14. Maintenance of official records “Very Good” “Good” “Poor”

15. Accuracy &Speed “Very Good” “Good” “Poor”

16. Capacity to express

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17. Has he been warned for any failure? Or any inadequacy in the year in writing or orally? If

so, give brief details.

18. Relationship with colleagues and “Very Good” “Good” “Poor” Fellow employee

19. Was any disciplinary action initiated against him during the period under report and if so,

the result thereof?

20. Loyalty and honesty

21. Does his health interfere with his work?

22. Fitness for confirmation/promotion

23. General Remarks, if any

24. Overall Grading “Outstanding” “Very Good” “Good” “Poor” Signature of Reporting

Officer Name (in Block Letters) of the Reporting Officer 

REMARKS OF REVIEWING AUTHORITY

“Outstanding” “Very Good” “Good” “Poor” Signature of Reviewing Officer Name (in Block

Letters) and Designation of the Reviewing Officer Rating “Poor” will only be considered as

Adverse Entry. In case the employee who has be enrated “Poor” or in case of any

Adverse Entry in the above report, the employee should be shown this report and in the

token there of his signature be obtained.

38
 IMPLEMENTATION

Section 1: Employee Information

Employee information section has basic questions regarding employee to be appraised.

Section 2: Performance (Key Performance Indicators)

The employee has to select different key performance indicator for all four perspective and rate

them self accordingly. The reporting and accepting authority will then rate the employee

according to the fulfillment of the target. The rating is done on the binary basis i.e. if the target

has been fulfilled the employee will get 100% rating and if not then employee will get 0 rating.

Section 3: Personal Qualities

The rating of employee is done by Reporting Authority and Accepting Authority on a scale of 1

to 5. Where ”1” stands for “consistently does not meet company’s expectation”; “2” stands for

”partially meet company’s expectation”; “3” stands for “meets company’s expectation most of

the times”; “4” stands for “consistently meet company’s expectation”; “5” stands for

“consistently exceeds meet company’s expectation”.

The personal qualities measured are effective communication skills, strategic orientation and

decision making ability, problem solving and analytical ability, ability to develop and motivate

team member, ability to coordinate and develop collaborative partnership, innovation and change

orientation, planning and organizing, result orientation, business acumen, external influence for

personal gains.

Section 4: Special Achievements and Innovation

39
This section has two questions:

(1) What are your significant achievements in the company?

(2) What were the constraints that hindered your performance?

These questions are answered by the employee and the answers are then rated by the reporting

Authority and Accepting Authority on a scale of 1 to 5.

Where “1” stands for “Negligible contribution toward achievement”;“2” stands for “Low

contribution toward achievement”;“3” stands for “Average contribution toward achievement”;“4”

stands for “High contribution toward achievement”;“1” stands for “Extraordinary achievement”;

Section 5: Final Rating

Final rating consists of average score of employee in Performance (Key Performance Indicators)

Score, Personal Qualities Score, Special Achievements and Innovation Score. The overall score is

calculated using following formulas:

Table1: Formula for calculating overall score for different grades

Final Grade is given according to overall score using the following table:

40
 Table2: Rating for different score

The above procedure is done by Reporting Authority and Accepting Authority.

Section 6: Appellate Authority

An employee can appeal against the review done by reporting and accepting authority, if, there is

any mistake or the employee thinks there has been biased rating against him/her.

Section 7: Final rating provided post review by Moderation Committee

After the employee has filed for re-review, a moderation committee is formed which checks for

any correction and does so if found and provides with the final score along with the necessary

comment.

After the final rating, a graph is drawn keeping number of employee on Y-axis and average score

on X-axis. After the graph has been plotted, CIL divides its employee on the basis of their

performance. That is, the total graph is divided into four groups on predetermined percentage

basis. The bonus is divided in the following four groups where the predetermined numbers

employees with highest rating gets maximum bonus.

41
Fig4: Graph showing distribution of number of employee with respect to performance
rating
.

CALCULATING PERFORMANCE RELATED PAY SCALE (PRP) FOR AN

INDIVIDUAL:

PRP from current year profit = 60%*Annual Basic Pay*MoU Rating*Grade Incentive*

Executive Performance rating* Ratio of required amount to

available amount

PRP from incremental profit = 40%*Annual Basic Pay*MoU Rating*Grade Incentive*

Executive Performance rating*Ratio of required amount to

available amount

Total PRP= PRP from current year profit + PRP from incremental profit

Where,

Annual Basic Pay is the amount of money that an employee makes throughout the course of

year.

42
MoU i.e. Memoranda of Understanding describes an agreement between two or more parties.

It expresses a convergence of will between the parties, indicating an intended common line of

action.

Different grades have different grade incentive.E1 to E4 has a grade incentive of 0.4, E5 and E6

has a grade incentive of 0.6, E& has a grade incentive of 0.8, General Managers(GM) Has a

grade incentive of 1 and Chairman cum Managing Directors(CMD) has a grade incentive of 2.

Executive Performance rating is the average rating of the employee obtained through PRIDE or

it is the final rating of the employee.

Ratio of required amount to available amount is the ratio amount required for PRP (current

year’s profit) to the amount available.

PRP for Incremental profit are given to the subsidiaries which have produced more coal then

the target given to them. Some portion of the profit made through the extra coal produced is

divided among the employee of that particular subsidiary.

UNDERSTANDING PERFORMANCE RELATED PAY SCHEME

43
Performance related pay is a common way of managing pay by linking salary progression to an

assessment of individual performance, usually measured against pre-defined objective.

Performance related pay is generally used where employee performance cannot be appropriately

measured in terms of output produced or sales achieved.

Whilst the detail of performance related schemes varies from business to business, there are

several common features:

 Individual performance is reviewed regularly against agreed objective or performance

standards. This is the performance appraisal.

 At the end of the appraisal, employees are categorized into performance group which

determines what the reward will be.

 The method of reward will vary, but traditionally it involves a cash bonus and \ or increase in

wage rate or salary.

Performance related pay has grown widely in recent years particular in the public sector. This is

part of the movement toward rewarding individual performance which reflects individual

circumstances.

There are several problems with performance related pay:

 There may be disputes about how performance is measured and whether an employee has

done enough to be rewarded.

 Rewarding employees individually does very little to encourage teamwork.

44
There is doubt about whether performance related pay actually does anything to motivate

employees. This may be because the performance element is usually only a small percentage of

total pay.

45
 DATA ANALYSIS AND INTERPRETATON

1. ARE YOU HAPPY WITH THE RECUITMENT

PROCESS IN YOUR ORGANISATION?

48%

52%

Fig.1

INTERPRETATION:

48% EMPLOYEES ARE HAPPY WITH THE RECUITMENT PROCESS.

• 152% EMPLOYEES ARE UNHAPPY WITH THE RECUITMENT

PROCESS.

2. SOURCE WHICH ORGANISATION RECUITS THE

EMPLOYEES INTERNAL OR

46
EXTERNAL SOURCES.

20%

80%

Fig.2 INTERPERTATION:

• 20% PEOPLE REQUIT FROM EXTERNAL SOURCES.

• 80% PEOPLE REQUIT FROM INTERNAL SOURCES.

47
 3. ARE YOU HAPPY WITH THE SALARY WHAT YOU
OFFERED FROM THE COMPANY?

18%

82% 1

• Fig.3 INTERPRETATION:

• 82% EMPLOYEES ARE SATISFIED WITH HER/HIM SALARY.

18% ONLY EMPLOYEES AREUNSATISFIED

48
 4. COMPANY USE OWN WEBSITE FOR THE
RECUITMENT PURPOSE. ARE YOU
SATISFIED WITH THIS SATETMENT?

24%

76%

Fig.4

INTERPRETATION:

• 24% EMPLOYEES ARE UNSATISFIED WITH THIS SATEMENT.

• 76% EMPLOYEES ARE SATISFIED WITH THIS SATEMENT.

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 7. METHOD OF SELECTION ADOPTED BY

ORGANISATION TO RECRUIT THE PEOPLE:

Sales
7%
23%
1st Qtr
2nd Qtr 3rd Qtr
4th Qtr

30% 40%

Fig.6

INTERPRETATION:

EVERY ORGANIZATION RECRUIT EMPLOYEE FROM DIFFERENT METHOD.

 30% EMPLOYEES ARE TOLD THAT PERSONAL INTERVIEW IS ADOPTED

 40% TELL THAT APTITUDE TEST IS ADOPTED

 7% RESPOND GROUP DISCUSSION IS ADOPTED FOR RECRUIT THE PEOPLE

 23% EMPLOYEE TELLS THAT PERSONAL INTERVIEW AND APTITUDE

TEST BOTH ARE ADOPTED BY THE COMPANY.

 0% RESPOND IN TELEPHONIC INTERVIEW

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7.ARE YOU SATISFIED WITH THE TECHNIQUS OF
RECUITMENT AND SELECTION PROCEES IN YOUR
ORGANISATION?

58%
42%

Fig.7

INTERPRETATION:

• 58% EMPLOYEES ARE UNSATISFIED WITH THIS STATEMENT.

• 42% EMPLOYEES ARE SATSFIED WITH THIS STATEMENT.

51
 FINDINGS AND ANALYSIS

• To large extent appraisal policy is helpful in archiving the goals of the company.

• A mostly external source is used for appraisal the employee.

• Employees agree to some extent that internet is effective.

• Performance Appraisal process needs improvement in terms of its procedure.

• The company do utilizes company’s website for the appraisal process

and for finding the talent candidate.

• Performance Appraisal provide an innovative cost efficient and effective

recruitment system.
Performance Appraisal dramatically reduces paper work and administration

52
 SUGGESTIONS/RECOMMENDATION

1. It as a pre-planned training program calendar. Interest employee can participate in the training

program of their choice. There is a key performance indicator relating to the training program

attended by the employee. Since the key performance indicators are selected by the

employees, they can easily skip this Key performance indicator in their performance rating.

An employee with poor rating in any of the selected key performance indicator should be

provided with proper training in that respective area.

2. New trainees should be provided with a proper training about the PRIDE system.

3. Any change in key performance indicators should be properly communicated to the

employees.

4. Employee should always know on what basis their performance is being measured.

53
 CONCLUSION

From the study it has been concluded that most of the employee are satisfied with the

performance management system. Only new trainees find it difficult to understand. They find

problem in selecting the Key Performance indicators as they are so many Key Performance

indicators and they have to select key performance indicator which is related to their jobs.

Appraises also wants that score of their PRIDE should be known to them and the basis on which

their score is given. Appraisers fells that the score of PRIDE should not be known to employee as

they think it is the only way by which they can control the behavior of employee. Appraisers

don’t have any problem with this system as they are experienced.

Most of the employees were satisfied with the performance related pay scheme. Employee found

the method for calculation and distribution of performance related pay to be easy to understand

and simple. Few of the employees with lower rating had problem with the method of distribution

of performance related pay.

54
 BIBLIOGRAPHY

1. Bendrick, M., Egan, M. & Lofhjelm, S. (2001). HR performance appraisal system

2. Kaplan, RS&Norton, DP, Jan-Feb (1996). Using the balanced scorecard as a Strategic

Management System, Harvard business review.

3. McGregor, L. (2000). Career Development International. Vol. 5 No. 4/5, pp. 244-249.

4. Taylor, W. (2005). The Age, My Career Section, p. 11.

5. Book Reference HUMAN RESOURCE MANAGEMENT, BY VSPRao

6. HRM, BY R.S Dwivedi HRM, BY P.Subba Rao

7. THE HR SCORECARD, BY Brian Becker,Mark Huselid and

8. DAVE ULRICH DR.C.R Kothari, 2008 research methodology Chris duke, 2001 recruiting the right

staff

9. www.bscdesigner.com

10. WEBSITE REFERED:

www.google.com/ www.wikipedia.com
https://avinashadvani.wo

55
 PERSONAL DATA

Gender: Male ( ) Female ( )

Experience : 0-5yrs ( )5-10yrs ( )10-15Yrs ( ) Above 15Yrs( )

Kindly rate the question from 1 to 15 as per the following scale:
Our information system allows for effective exchange of information in the Organization.
Strongly agree( ) Agree ( ) Disagree ( ) strongly disagree ( )
All members of our organization are aware what theres of the organizationare.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
In our organization we often organize internal training of our employees.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
We frequently hold meetings with the purpose to inform employees.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
We have individuals dedicated to collecting and internal dissemination of improvement
propositions from employees.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
In our organization we have individuals that work in more than one team or project groups
together with individuals from other organizational units.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
Innovation proposals are welcome in the organization.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )

56
Reports prepare by external experts are an extremely important source of information.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
We deal with customer’s suggestions or complaints urgently and with utmost care.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
Employees in our organization are an important source of information.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
New business methods and services are always worth trying even if they may prove risky.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
Expertise on the industry, products, and services is an extremely important criterion for hiring a
new employee.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
Previous decisions are a very useful source of information for current decisions.
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )
Do you think effective communication plays a vital role in organization development?
Yes ( ) No ( )
Your organization considers training as a part of organizational strategy. Do you agree with this
statement?
Strongly agree ( ) Agree ( ) Disagree ( ) strongly disagree ( )

THANK YOU

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