Performance Appraisals

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Project Synopsis

A STUDY ON DIFFERENT APPROACHES OF PERFORMANCE APPRAISALS: A SPECIFIC STUDY IN SOFTWARE INDUSTRY

Project Guide

Submitted By

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Project Synopsis checklist 1.

TITLE OF THE PROJECT ...............................................................................3

2.

EXECUTIVE SUMMARY .................................................................................3

3.

STATEMENT ABOUT THE PROBLEM ..............................................................4

4.

RESEARCH METHODOLOGY..........................................................................6

5.

QUESTIONNAIRE .........................................................................................9

6.

CHAPTERISATION SCHEME ........................................................................ 16

6.1.

Introduction .............................................................................................. 16

6.1.1

Background of the Study ............................................................................ 16

6.1.2 Introduction to the IT System?....................................................................... 16 6.2.

Research Design ........................................................................................ 17

6.3.

Company profile ........................................................................................ 17

6.4.

APPROACHES OF PERFORMANCE APPRAISAL .............................................. 17

6.5.

Conclusion................................................................................................. 18

6.6.

Bibliography & Annexure ............................................................................ 18

6.6.1

List of Tables ............................................................................................. 18

6.6.2

List of figures ............................................................................................ 18

6.6.3

Questionnaire ............................................................................................ 18

7.

PERFORMA FOR SYNOPSIS OF PROJECT WORK .......................................... 18

8.

Guides Resume.......................................................................................... 19

(This Project Synopsis is submitted in partial fulfillment of the requirement of Master of Business Administration, Institute Of Management Technology Centre Distance Learning, Ghaziabad)

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

1. TITLE OF THE PROJECT A STUDY ON DIFFERENT APPROACHES OF PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION: A SPECIFIC STUDY IN SOFTWARE AND COMMUNICATION INDUSTRY

2. EXECUTIVE SUMMARY Performance appraisal is an important HRD mechanism. It is the process of evaluating the performance of employees in terms of the requirements of the job for which they are employed for administrative purpose, including suitable placement, selection, promotion, giving financial rewards and other action which require differential treatment between the members if a group as distinguished from actions affecting all the members equally. Earlier performance appraisal was considered as a simple and confidential method of rating the job performance of individual employees by their superiors for the purpose of giving those remarks and rewards. Early appraisal systems stressed assessment of personality tracts, which were difficult not only to measure but also to relate constructively to the job itself. The purpose of performance evaluation is to generate information to support administrative decisions. The difficulties in measuring performance in software companies like the performance evaluations are highly subjective. Goal setting is ineffective when goals are too simple, when goals of not constitute the goal job, when goal attainment is difficult to prove or measure, when performance is the result of term efforts, peer and subordinate rating not followed no incentive for performance, implementation of the appraisal system may not be as planned because of time constraint and span of reports. Over a period of time appraisal become a ritual. To address the above a study was conducted to study the different approaches of appraisals adopted by software companies. A sample of 30 software companies was taken. A structure questionnaire was administered to HR managers/ executives of different companies to elicit the information. Major findings of the study include the most common type of appraisal is the open system followed by MBO, a few companies followed 360 feedback while most of the companies are planning to implement this powerful new model for employee assessment and performance improvement. The positive areas/benefits of the appraisal system followed included training and development inputs, career planning, and objective I setting etc.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION The criteria or measures to evaluate an employee in most of the companies are technical competence, performance, achievement vs. objectives, key result areas set at the beginning of a specific period, forming result oriented areas, leadership skills, team work, attitude are behavior oriented areas compensation increase is related to performance and depended on the performance code/rating give. Target is set for employee being appraised for a period of 6 months; checklist for carrying out appraisals and carrier planning is followed. 360° feedback process gives an all round perspective restricting the inconsistency factor that exist in traditional appraisal system. Organizations remove layers of management, flatten their structure, and begin using self-directed terms; the, only practical option for performance feedback is from multiple sources. As organization changes their culture to align with their vision and values, 360° feedbacks becomes an ideal choice to communicate the new competencies required by the new values.

3. STATEMENT ABOUT THE PROBLEM The research intends to study the different approaches of appraisals adopted by software Companies and employee attitude, employee Satisfaction and industrial morale. It also analyses the most commonly occurring errors within performance appraisal methods and to understand the level of effectiveness of 360º appraisal in the industry 3.1 NEED AND IMPORTANCE OF THE STUDY

This study is conducted with respect to understanding the different appraisal systems conducted in the software industry and their effects thereafter in the same. Due to time and resource constraints, the study was restricted to the software industry in Delhi Region .

3.2 OBJECTIVES OF THE RESEARCH 1. To find out the different appraisal systems followed by software companies. 2. To find out who appraises the employees. 3. To analyze and study the benefits of the appraisal systems. 4. To analyze the shortcomings of the appraisal systems. 5. To identify the criteria and measures adopted to evaluate employee performance. 6. To find out the level of effectiveness of the 360 degree feedbacks. 3.3 REVIEW OF LITERATURE Purpose

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION The literature review section examines the importance of search studies, company data or industry reports that serve as a foundation for the setup of study. The research dimension of the related literature and the relevant information begins from an explanatory perspective, approaching towards specific studies which do related to the judge the limitations and informational gaps in data from the secondary sources. This analysis may reveal conclusions from past studies to realize the reliability of the secondary sources and their credibility. This in turn enables one to rely on a comprehensive review for the study.

ANALYSIS OF PREVIOUS STUDY A survey about current practice, which is followed in companies to appraise performance: ( Phatak, International Dimensions of Management) Almost all software companies responding do have formal appraisal programs. About 93% of smaller organizations (those with fewer than 500 employees) have such programs. About 97% of large organizations have them. Rating scales are by far the most widely used appraisal technique. About 62% of small organization use rating scales, 20% use essays, and about 19% use MBO. Among the large organizations, 51% use rating scales, just over 23% use essays and about 17% use MBO. However, those using ratings as the main appraisal technique typically also require narrative comments to justify rating and to describe employee strengths and weakness and document development plans. Those using essays as the main appraisal technique usually require an overall quantitative performance rating to facilitate employee comparisons for compensation decisions. The employee’s immediate supervisor makes Ninety two percent of appraisals. These appraisals are in turn reviewed by the appraiser’s supervisor in 74% of the responding organizations. Only about 7% of the organizations use self-appraisal in any part of the overall appraisal process. Virtually all employees (99%) are informed of the results of their appraisals. Overall about 77% are given a chance to respond with written comments on their appraisals. In 69% of companies, appraisals are done annually.

METHODS OF REVIEWING THE LITERATURE

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION The review of literature does scrutinize the important research studies. The primary sources that provide relevant information are the best form to retrieve data from the research. The primary sources were encouraged with the help of distribution of questioners as well as conducting personal interviews. With this the data received enables the researcher to accurately arrive at the problem of the study and the consecutively solutions to the same. The secondary sources were also relied on for additional information. It includes company journal, newsletters, records, manuals etc. CONCLUSION Performance management lays an evaluative and developmental dimension to its makeup, and is crucial in both linking rewards to performance and providing a platform for the development of employees. Over concentration on the assessment of performance can work to the detriment of effort aimed at establishing the development needs of the individual in an open and honest way. The manager, as an appraiser, may encounter difficulties in reconciling the roles of 'judge' and 'mentor'. Managers need to develop the skills of coping with such tensions in their roles. In some organizations, this problem is solved by having different managers carrying out performance and development appraisals. Appraisal provides the context in which mangers can seek to ensure that there is acceptable congruency between the objectives of the individual and those of the organization.

4. RESEARCH METHODOLOGY TYPE OF RESEARCH The research design comprise of the plan and structure of investigation conceived so as to arrive at the responses to the research queries. It there by addresses the aims and objectives of the study, both descriptively and analytically.

SAMPLING TECHNIQUE The sampling technique adopted for the study is non-probability Random sampling technique according to the convenience of the researcher. A questionnaire was administered to HR managers / executives of different software companies to obtain data for the purpose of analysis. SAMPLE SIZE Data is collected using a sample of 30 software companies.

SAMPLE DESCRIPTION

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

The sample mainly consists of data from the primary sources that are utilized for the purpose of this study.

This is done by means of administrating questioners to human

resource managers / executives in different software companies in the city of Bangalore. Secondary data like company journals, newsletters, records etc. were also relied on for retrieving further information. INSTRUMENTATION TECHNIQUE

Questionnaire and structure disguised questions. ACTUAL COLLECTION OF DATA

Both secondary and primary sources of data are utilized for the purpose of this study. Primary data is collected by means of administering a questionnaire to the Human Resource Managers / Executives in different software companies. Secondary data is collected from various records, manuals and other sources of the HR Department. TOOLS USED FOR TESTING OF HYPOTHESIS

In attempting to arrive at a decision about the population on the basis of the sample information it is necessary to make assumptions or guesses about the population parameters involved such an assumption is called statistical hypothesis, which may or may not be true or not is called test of hypothesis or test of significance. In the test of hypothesis it begins with an assumption or hypothesis is called Null Hypothesis. The null hypothesis asserts that there are no significant differences between the statistics and the population parameters and whatever observes difference is there merely due to fluctuations in sampling from the sample population. Null hypothesis is usually denoted by the symbol, Ho. Any hypothesis that contradicts the Ho (null hypothesis) is called an alternative hypothesis and is denoted by symbol H1. hypothesis is Test for proportion. TEST FOR PROPORTION

The technique used to test the

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Suppose the population of an attribute in a population is now known, we want to test whether the proportion is a given value P. The null hypothesis is Ho : p = P. The alternative hypothesis is H1: p  P. The large random sample of size n from the population, let x units possess the attribute. Then the sample proportion is p = x/n.

And so, Z =

p-P

 PQ n Therefore, the test statistics is | Z | =

P = assumed level of effectiveness Q = 1-P p = level of effectiveness of sample n = sample size

For the sample, if | Z | cal > k, Ho is rejected .On the other hand, if | Z | cal < Ho is accepted. OTHER SOFTWARE USED FOR THE DATA ANALYSIS

For the data analysis, and the subsequent interpretation the researcher has adopted advanced version of MS-EXCEL 2000. This application software has facilitated the researcher to construct the frequency table, various kinds of graphs and to find out the average responses from the sample. By this automated data analysis it has minimized the researcher’s time constraint and reduced human errors and also accurate outlay of information.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

5. QUESTIONNAIRE There were two questionnaire were designed. First has been designed to assess the job satisfaction level and morale of the employees in the organization. Second was designed for the HR of the specific software companies.

HOW YOU FEEL ABOUT YOUR JOB? The questionnaire consists of nine sections, each section having a number of statements. Please answer all the statements. You are requested to be honest and frank in your replies. You are not required to write your name. The answers given by you will be kept confidential.

Please assess the extent to which each statement describes you and your organization using the following five point rating scale; encircle the most appropriate rating.

1. Strongly Disagree (SD) 2. Disagree (D) 3. Indifferent (I) 4. Agree (A) 5. Strongly Agree (SA)

SECTION I (Personal Details): 1. Age : ______________________________________ 2. Experience in the present organization: ___________

SECTION II (Job Itself): S.NO

SD

D

I

A

SA

: A. 3.

TASK SIGNIFICANCE My performance on the task determines or influences performance of my colleagues also.

B.

TASK IDENTITY

1

2

3

4

5

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION 4.

I feel that the task(s) I perform need independent charge and cannot be clubbed with some other responsibility.

C.

1

2

3

4

5

SKILL VARIETY

5.

The organization believes in multi-skilling.

1

2

3

4

5

6.

I am given an opportunity to develop my skills further to do

1

2

3

4

5

my job in the organization.

D.

AUTONOMY

7.

I am given independence in important decision-making.

1

2

3

4

5

8.

There is flexibility and freedom in the job that I do.

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

E. 9.

INTEREST IN WORK My job is usually interesting enough to keep me from being bored.

10.

Most days I am enthusiastic about my work.

SECTION III (Job Advancement/ Scope For Advancement): S.NO

SD

D

I

A

SA

GROWTH PROSPECTS / PROMOTIONS 11.

I feel I can personally develop or grow in my job.

1

2

3

4

5

12.

Promotions decisions are taken objectively.

1

2

3

4

5

13.

The company has satisfactory promotion policy.

1

2

3

4

5

14.

Good performance is also considered in promotion decisions.

1

2

3

4

5

SECTION IV (Management Responsiveness): S.NO

SD

D

I

A

SA

2

3

4

5

: A. 15.

RECOGNITION AND APPRECIATION I feel that my efforts are valued in the company.

1

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION 16.

I will be recognized and appreciated when I will go beyond

1

2

3

4

5

what is expected in my job.

B. 17.

FEEDBACK My supervisor(s) constantly provide me feedback, which

1

2

3

4

5

enable me to improve my performance.

C. 18.

MONETARY BENEITS (Pay, Perk, Benefits, Compensation) There is a significant component in my compensation

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

package that is performance linked. 19.

All incentive schemes are transparent. Linkages of incentives with performance are clear.

20.

Compared with people in similar jobs in other companies, I feel my pay is fair.

21.

I personally feel that monetary rewards alone are not sufficient to motivate me to work better.

D. 22.

SECURITY In my understanding, there is no threat to my job due to redundancy or any other reason.

E.

PARTICIPATION / PARTICIPATIVE MANAGEMENT

23.

My superiors involves me in the decision making process.

1

2

3

4

5

24.

I can express frankly my feelings and reactions in the

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

meetings and to my senior managers. 25.

I personally feel that my subordinates have to be given very clear directions to execute their work.

F. 26.

GRIEVANCE HANDLING There is a fairly clear-cut and detailed grievance handling mechanism in place in my organization.

G. 27

TRAINING AND LEARNING My company sends people for training when they need to learn new things related to their job profile.

28.

It is my company’s express policy to proactively train people from a long term H.R development perspective.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

H.

COMMUNICATION SYSTEM

29.

I am kept informed on what goes on here.

1

2

3

4

5

30.

I am satisfied with the communication and the way

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

information flows around in my organization.

I.

REWARD

31.

Mainly excellence in performance and getting tasks accomplished is rewarded.

32.

Knowledge and expertise are recognized and rewarded here.

SECTION V (Working Groups & Culture): Factors included in this are: 1. Supervision (Quality of supervision, support from supervisors, supervisory treatment, competency of the supervisor) 2. Relationship with co-workers 3. Support from co-workers 4. Cohesiveness 5. Teamwork 6. Culture

S.NO

SD

A. 33.

D

I

A

SA

SUPERVISION My superior / boss gives me enough freedom to do things in

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

my own way. 34.

My boss provides me enough guidance about how I should perform my job well.

35.

Supervisors try to use their expertise and competence rather than their formal authority in influencing their subordinates.

B. 36.

WORKING GROUPS I feel that ‘we’ work as a team of mutually complementing individuals in our section / department.

37.

My company provides enough conducive environment – formally and informally – to work in teams.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION 38.

People get along well with each other in my section.

1

2

3

4

5

39.

The people I work with are very friendly and supportive of

1

2

3

4

5

one another.

SECTION VI (Status / Occupational Status): S.NO

SD

D

I

A

SA

: 40.

I don’t care about rank and job titles; its what I am doing is

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

important. 41.

I think my position should be reflected through various status symbols, etc.

42.

My organization ensures that hierarchical differences are clearly discernible.

SECTION VII (Working Environment): Factors included in this are: 1. Conditions of work, physical environment 2. Working hours 3. Fatigue and monotony 4. Provision of food 5. Transportation

S.NO

SD

D

I

A

SA

43.

I have convenient working hours.

1

2

3

4

5

44.

I feel exhausted by the time I am through with my day’s

1

2

3

4

5

1

2

3

4

5

1

2

3

4

5

work. 45.

In a typical day’s work : We get good lunch and other snacking items.

46.

Transportation to my workplace and back is comfortable experience : Because the company has good transportation facilities.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

SECTION VIII (Social Relations): Factors included in this are: 1. Participation in social activities 2. Friends and associates. S.NO

SD

D

I

A

SA

: 47.

My interaction with colleagues extends beyond office hours.

1

2

3

4

5

48.

Our company organizes lot of events like sports meet,

1

2

3

4

5

recreational activities, family outings etc.

SECTION IX (Organizational Commitment): S.NO

SD

D

I

A

SA

: 49.

I think I can proudly tell the name of the organization I work

1

2

3

4

5

1

2

3

4

5

for. 50.

Even if the company would reduce my salary because of financial problems, I would be reluctant to change to another company.

QUESTIONNAIRE FOR HR Name of the Organization: Designation: Total No. Of employees in the Organization

1. Do you appraise an employee by an appraisal system?

Yes

No

2. If yes, what is the system of appraisal adopted by your company?

3. How often are appraisals carried out in your organization? Quarterly

Half Yearly

Annually

Others (Please Specify)

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

4. What are the criteria used in your company to evaluate an employee? Performance

Customer Focus

Technical Competence

Attendance

Target Vs. Achievement

Key Result Areas

Quality of Output

3 Point Scale

5. What is the rating system used in your company? Scoring

Comments

Both If scoring is it Alpha

Numeric

Both 6. Do you obtain feedback on the person being appraised? Yes

No

7. How is feedback given to the employees? Written

Oral

Detailed

Summarized

Self-Assessed

Manager Assessed

8. Do you share both positive and negative feedback with appraise in the same meeting? Yes

No

9. Do you follow a self-assessment of an employee? Yes

No

a) If yes, is it integrated into the appraisal system you follow? Yes

No

10. Is compensation increase related to an appraisal in any way? Yes

No

11. Does the appraiser set targets for an employee being appraised? Yes

No

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION If yes, for what period? 3 Months

3-6 Months

6 Months

12 Months

12. Do you have a checklist for carrying out appraisals? Yes

No

13. Do you follow career planning? Yes

No

14. What would be the level of effectiveness of 360 score when implemented as a form of appraisal? Less than 20%

20% - 35%

35% - 50%

above 50%

6. CHAPTERISATION SCHEME The project would deliver the following topics:      

Introduction Research design Company profile Approaches of performance appraisal Findings, suggestions and conclusions Bibliography and Annexure

6.1. Introduction This chapter would provide a short introduction of what is Performance Appraisal and the Background of the research and what would be divided on 3 basic chapters as mentioned below.

6.1.1

Background of the Study

This chapter would be designed in such a way to provide an overall scenario of the IT world and the lateral shift of the Methods used and result observed. Almost all software companies responding do have formal appraisal programs. About 93% of smaller organizations (those with fewer than 500 employees) have such programs. About 97% of large organizations have them.

6.1.2 Introduction to the IT System? This chapter will have an elaborate description of Information Technology and ERP systems. ERP which is one of the latest developments in software for business enterprise wide Resources Planning (ERP) System is an integrated business management system

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION 6.2. Research Design The research intends to study the different approaches of appraisals adopted by software Companies.

6.2.1

Statement of the problem

It also analyses the most commonly occurring errors within performance appraisal methods and to understand the level of effectiveness of 360º appraisal in the industry 6.2.2

Need and importance of the study

This study is conducted with respect to understanding the different appraisal systems conducted in the software industry and their effects thereafter in the same 6.2.3

Objectives of the study

To find out the different appraisal systems followed by software companies 6.2.4

Review of literature

The literature review section examines the importance of search studies, company data or industry reports that serve as a foundation for the setup of study. 6.2.5

Operational definitions of concepts

A more comprehensive definition is, “Performance appraisal is a formal structured system of measuring and evaluating an employee's job and how the employee can perform effectively in future so that the employee, organization all be benefited." 6.2.6

Research Methodology

6.3. Company profile

6.3.1. Indian IT industry The Indian IT-ITES industry is broadly categorized into IT services and software, ITES-BPO and Hardware segments. The industry continues to chart remarkable double-digit growth, with industry aggregate revenue for 2005-06 expected to reach US$ 28 billion. The industry is forecast to grow more than fivefold over FY 1999-06, at a CAGR of 28 percent. 6.3.2. Industry Trends. 6.4. APPROACHES OF PERFORMANCE APPRAISAL Analysis of data was done with the purpose of summarizing the collected data and organizing these in such a manner that they answer the research questions. Percentage analysis was used for analysis

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION of data and the results have been presented by way of pie charts, bar charts, with the help of SPSS package 6.5. Conclusion

At the end of the project report we can mention why an organization would and should use an Effective Performance Appraisals techniques and its key benefits. 6.6. Bibliography & Annexure 6.6.1

List of Tables

6.6.2

List of figures

6.6.3

Questionnaire

7. PERFORMA FOR SYNOPSIS OF PROJECT WORK PROFORMA FOR SYNOPSIS OF PROJECT WORK Name: Amit Kursija

Enrol. No.: 52102420

Address for Correspondence : BA/ 45 - B Phase 1 Ashok Vihar Delhi 110052 Mobile No: +91-9873253288 Major area of specialization in which project work is to be undertaken: Human Resources Questionnaire attached: Yes Resume of Project Guide attached: Yes Consent letter of Project Guide: Yes Phone No. of Project Guide: 9990688283 Date of submission: August 14, 2008

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

8. Guides Resume As per the guidelines please find below the resume of Mr. Rajiv Malhotra who has guided and helped me design the below project. He also assisted me run this project within our organization and assisted to go get the data from the other software companies in delhi and NCR region, without his approval and help this would not have been possible. Objective To specialize in organization level Human Resource Planning and Development. To keep developing HR skills and be a part of a dynamic team and help the organization grow, by suggesting and implementing innovative HR policies and initiatives. Academic profile    

Master of Personnel Management & Industrial Relations (MPM&IR), 2 Years Full Time Post Graduate Course from Jiwaji University, Gwalior (1999) Higher Diploma in Software Engineering (HDSE) from Aptech. (MS -DOS, Windows 95/98/NT, MS- Office, C, C++, Oracle, D2k, Networking, SSAD, Internet Browsers) (1999) B.Com from Jiwaji University, Gwalior (1997) Pursuing Diploma in Training & Development from ISTD, Delhi (Final Semester)

Work Experience S.NO 1. 2.

3. 4.

ORGANISATION Intersoft Data Labs Pvt. Ltd Fidelity National Information Services (Earlier know as Second Foundation India Pvt Ltd) National Dairy Development Board (NDDB) Deus Technology

August 2006 to Till Date

:

DESIGNATION Manager-HR Assistant Manager-HR

DURATION Aug 2006 – Till Date Aug 2005– Aug 2006

Deputy Manager-HR

Aug 2004– Aug 2005

Senior Executive-HR Recruiter

Nov 2002– July 2004 Oct 1999 – Nov 2002

Intersoft Data Labs Pvt. Ltd., Gurgaon Manager-HR

Handling a team of seven HR professionals and overseeing all HR activities of the organization including recruitment, people practices, employee satisfaction, performance management, organizational development, audits (BS7799, ISO27001, CMMi) and compensation management etc.

Key Responsibilities HR Strategy and processes o Contributing to HR strategy and ensuring that action plans are created and implemented to implement the strategy. o Identifying Key Result Areas for the processes annually with respect to business Operations with inputs from the business heads and monitoring the implementation of these. o Designing of role competency matrix for each role in the organization. o Documentation and release of the Human Resources Manual for the organization. o Designed Developed and implemented People Management policies and processes after benchmarking with the best in the industry and as per company requirements.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION Define and implement strategies for recruitment & resource management o Define and implement strategies for recruitment & resource management. o Define manpower recruitment plan. o Define processes and policies for selection, outsourcing and induction. o Interview and shortlist candidates for interviews with line managers. o Manage Campus and Off Campus hire. o Conceptualize and define systems & tools to support Resource Management. o Allocate resources to projects based on projections. o Developing, Monitoring and Maintaining of database on the basis for immediate future manpower requirements. Prepare / Update Monthly Manpower Report. Employee Management & Organizational Development o Facilitation of OD Initiatives like compensation benchmarking, open house, E-Sat etc. o Conducting Exit interview and preparing Attrition Analysis as part of retention strategy. o Actively participated in Implementation of Quality System for successful certification of BS7799, ISO: 27001 & CMMi. o Ensuring effective HR Services deployment, Process compliance & Service delivery as per SLA. o Sharing information with the employees in different forums. o Taking care of entire employee engagement/retention/welfare. o Employee Satisfaction Index on a quarterly bases to ensure a transparent culture and healthy environment. Ensuring fulfillment to Internal Customer’s expectations on time. Counseling employees, from time to time on behavioral attributes, defusing conflicts, building a congenial and performance friendly work atmosphere. o Anchoring the employee help-desk. Addressing employee issues and concerns. o Organizing Get-togethers (Monthly / Annual) like Fun Friday; Employee Day; Family Gettogethers; Monthly sports competitions. o Corporate Social Responsibility - Blood Donation camps, Computer literacy camps, Philanthropy, o Visits to various NGO. Training and Skill Development o Prepare/Maintain Annual Training Calendar, Training Attendance, Feedback Records, Measuring Training Effectiveness and Training Analysis. o Plan for and schedule the induction events in anticipation of the dates of joining of Individuals. Ensure completion of joining formalities in terms of process steps and documentation. o Skill Inventory Application Maintenance. Performance Management o Ensuring a fair and transparent process of appraisal through feedback sessions with employees and Human resource presence (where necessary). o Managing the overall Appraisal process – Policy Formulation & Clarification, communication / rollouts, coaching employees / managers in writing effective appraisals, Data Validation, Goal Setting, Self Appraisal, Appraiser evaluation, Reviewer evaluation, identifying development plans for employees conducting ensuring the appraisal process is closed with the time line. o Performance Normalization meetings, Post-Appraisal data mapping, analysis and finalization of rewards.

August 2005 to August 2006

:

Fidelity National Information Services (Earlier know as Second Foundation India Private Limited), Chandigarh Assistant Manager-HR

Company Profile Fidelity National Information Services (Earlier know as Second Foundation India Private Limited), a leading provider of global software services, specializes in Business Intelligence, Software Security and Web Services solutions. It houses more than 650 employees.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Job Responsibilities Policies & Procedures o Drive the design and implementation of HR strategies in a high growth environment and also formulate comprehensive HR policies. o Designed Developed and implemented People Management policies and processes after benchmarking with the best in the industry and as per company requirements. o Documentation of policies & processes necessary for smooth implementation of policies. Regular review of policies & process improvements. Capacity Planning and Recruitment o Preparing and monitoring recruitment plan o Ensuring acquisition of the best talent through a process of recruitment tests and interviews. o Plan for Campus and Off Campus hire and its implementation. o Sourcing talent and their Reference Check; Background and employment verification. Performance Management o Assisted in review and implementation of effective performance appraisal uniformly all across the organization. o Defining various roles within the organization as well as skill required at each level. (Job and Role Descriptions). Defining the organization structure and career progression path. o Manage Goal Setting Exercise. OD Initiatives o Facilitating healthy organizational culture by promoting open house discussions, suggestion schemes, E-Sat (ESS), Intranet etc. o Employee Engagement activities like Open House, Monthly Events, Employee Events, Celebrations, Yoga Classes, Grievance Handling etc o Manage exit formalities. Conduct exit interviews, analysis and finalize F&F settlement. Actively participated in Implementation of Quality System for successful certification of ISO: 9001:2000. Trainings o Organizing training programmes for existing employees and freshers hired through campus & offcampus. o Organising Induction trainings for new hires. o Identification of behavioral and technical training needs. o Generating feedback from the trainees with regard to the benefits drawn from the training. Compensation Management o To gather and update information about the compensation/salary, employee welfare and incentive schemes with respect to competitor’s vis-à-vis market intelligence. o Improve communication of policies and benefits through Benefits campaigns; Policy clarification sessions for the HR and Resourcing team; Timely response to queries on policies and benefits. o Conduct Salary benchmarking exercises. o Active interaction with Resourcing team for taking inputs on market trends and equip them with recruitment guidelines. Compliance o Shops and Establishment o PF Compliance o Payroll o Contractual staff o Mediclaim Insurance

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION August 2004 to August 2005 (Gujarat)

:

National Dairy Development Board (NDDB), Anand

Deputy Manager-HR Company Profile The NDDB is a Public Financial Institute and was created to promote, finance and support producer-owned and controlled organizations. Fundamental to NDDB's efforts are cooperative principles and the Anand Pattern of Cooperation. It houses more than 1500 employees.

Job Responsibilities Human Resource Information System (HRIS)- ERP Implementation o Undertake necessary actions for implementation of HRIS (ERP-Orion) module. o Provide support/inputs in context of problems arising during implementation. o Continually monitor HR/Client information needs and design new/modify existing system to meet changing requirements. o Provide accurate, timely responses to information requests from operating groups, Support Group and others as appropriate. o Design, generates and distributes a variety of reports and statistical summaries. Prepare and submit periodic, recurring activity & status reports to superiors Training & Development o Devising an Induction Intersoft Data Labs Pvt. Ltd, Compensation, etc. o Organizing training programmes for Officers & Staff, Identification of training needs, Generating feedback from the trainees with regard to the benefits drawn from the training. Performance Management o Process the Appraisals of the employees, Initiation appraisal forms and follow-up for timely receipt of the same. o Assisted in Six Monthly & Annual Performance Feedback. Operations o Responsible for personnel functions like joining, LTA, Separation, Full & Final Settlement, etc, Formulation of Organization Structure. o Employee grievance handling. Issuance of Various Certificates i.e. NOC for Passport, NOC for Visa, Verification, Residence Proof, Service Certificates etc. o Periodic Voluntary Medical Check-up (PVMC), Permission for Higher Studies, Training/Visits Abroad. Proposals to MD for approval for various other purposes. o Implementing formal system of Internal Communication- Interaction meeting with Unions, Other participative Forums. o Welfare activities for employees and their family members. o Liaisoning with All Department Heads regarding HR related matters. Oct 1999 to July 2004

:

Deus Technology, Delhi Senior Executive HR Recruiter

(Nov 2002 to July 2004) (Oct 1999 to Nov 2002)

Job Responsibilities Recruitment & Selection o Organizing the entire recruitment process. o Sourcing–Advertising, Job portals, Consultants, Referrals, Head hunting, cold calling, Internet researching Getting References etc. o Maintaining targets & quality. o Initial screening, Scheduling & Coordinating for further Interviews. o Responsible for recruitments at all levels and spheres (National/Overseas) o Offer Negotiations & Follow up, Reference Checking. o Generation of activity reports and analysis.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION o

Induction, Verify credentials if required through verification process, Statutory compliance, Confirmations, Probation reports, Confirm / Extension / Termination.

Performance Appraisal o To organize Appraisals as per the policy and to Ensure Appraisals are done and are in order. o Performance evaluation and compilation and finalization of rewards. o Issue promotion / increment letter as applicable. Payroll Management o Responsible for preparing Salary statement every month with all necessary deduction and timely o disbursement. o Providing salary statement and monthly report to accounts department on a monthly basis. Operations o Attendance & Leave Management, Full & Final preparation, Exit Interviews, Employees Communication, Employees Database Management etc. o Introduced Suggestion Box and Movement Register in the organization. o Drafting of Offer Letters, Appointment Letters, and Experience Letter, Relieving Letter, Increment Letter, and Salary Certificate etc. o Issue of Warning Letters, Maintaining Discipline Maintenance of harmonious Relation. o Design and regularly updating the HR manual. o Organizing employees get-togethers and parties to celebrate the special occasions. o Induction Trainings, Training to Resource Executives. o Ensure compliances w.r.t. PF, Gratuity, Shops & Establishment Act, etc. o General administration activities-Telephone/Fax, Library Management, Hotel & Travel Arrangement, etc.

Professional Memberships Details

o Individual Life Member of National HRD Network (NHRDN), Delhi Chapter. o Student Member of Indian Society for Training & Development (ISTD), Delhi Chapter. Organisation Training Details Training/Membership Training on Metrics Introduction to CMMi Business Communication Stress Management Training On ESI, PF, Bonus, Gratuity Personnel Functions (OJT) Grievance Handling (ST)

Organisation

Duration

Date

Intersoft Data Labs Pvt. Ltd. Intersoft Data Labs Pvt. Ltd. FIS (Second Foundation) NDDB ATC Infotech (P) Ltd

Half Day 1 Day 2 Days 1 Day 1 Month

May 28, 2007 Apr 12, 2007 May 12-13, 2006 Jan 2005 April-May 2000

Flex Industries Ltd HTC Ltd

3 Months 2 Months

1999 1998

Personal Details Date Of Birth Permanent Contact Address Phone Passport No Driving License No.

17th Jan, 1977 ‘Bhardwaj Sadan’, City Centre, Opposite BSNL Building, Tulsi Vihar, Gwalior (M.P)-474011. 0751-223876 A8539380 Y-1964/20

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

1.1 Background of the Study Information technology (IT) revolutionized many aspects of a business. There is hardly any organization which has not installed at least one ubiquitous computer. There is a wide choice for computer users - from a simple PC to sophisticated network of computers. Applications of computers in various function is common these days; from mere data storage to more advanced software packages like ERP which can do many things in an organization but fortunately, cannot substitute common sense or human ingenuity. It is well to remember that IT is one more tool in hands of a management to get things better and faster. Example of IT application, ERP which is one of the latest developments in software for business enterprise wide Resources Planning (ERP) System is an integrated business management system which covers some important aspects of business such as logistics, production, finance, accounts, human resources, planning, materials and warehouse management. Right from the receipt of an inventory, an ERP system tracks materials, capacity and labor resources. Thus an ERP system package claims to aid a business to manage it activates dynamic and integrated manner. But it is equally important to understand and appreciate the flip side of such sophisticated IT packages like ERP. First of all the people ho handle such a package must be qualified and must posses relevant work experience in the functional module, which a person wants to get trained. An organization, which wishes to work with ERP, must have already had experience with proper working IT infrastructure. There should be enough number of terminals for concerned people to key in data or run a query. One of the toughest things to overcome is the attitude of the people for adapting to a change. Thus ushering in a new "IT culture" remains one of the greatest challenges for any management interested in adapting IT as a tool in as many functions of the organization as possible.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

The vital role of IT is to support a management and not control it. Thus the IT most understands their role vis-à-vis decision-making. Just because a sophisticated IT package has been installed in an organization cannot guarantee success .If for example, a vendor is supplying poor quality supplies consistently, the information system will tell the management of such a fact faster. But now it is up to the management to initiate corrective measures- visit vendor to assist him to come up to standard, develop alternate vendor or import. Some cautious management would like to implement information system module by module to gain experience. Such a procedure may or may not guarantee success. Some IT experts urge an organization to implement a total IT system such as ERP-a classic case of all or bust. In the enthusiasm to appear very modern and up-to date a management may go in for IT package when the ground reality within the organization is not conductive to such a drastic change. On the other hand a few well-tried techniques do wonders for an organization. For example, an organization's urgent need may be to change existing technology to an upgraded one. An ERP package obviously, won't tell the management to do just that. Also, a few time -honored principles like "do it right at the first time" must be followed in an organization with or without a sophisticated IT tools. A responsible management will put the IT in its place to serve the overall business interests.

2.1 Statement of the Problem

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

The research intends to study the different approaches of appraisals adopted by software Companies. It also analyses the most commonly occurring errors within performance appraisal methods and to understand the level of effectiveness of 360º appraisal in the industry 2.2 Need and Importance of the Study

This study is conducted with respect to understanding the different appraisal systems conducted in the software industry and their effects thereafter in the same. Due to time and resource constraints, the study was restricted to the software industry in Bangalore City. 2.3 Objectives of the Research

1. To find out the different appraisal systems followed by software companies. 2. To find out who appraises the employees. 3. To analyze and study the benefits of the appraisal systems. 4. To analyze the shortcomings of the appraisal systems. 5. To identify the criteria and measures adopted to evaluate employee performance. 6. To find out the level of effectiveness of the 360 degree feedbacks.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

2.4 Review Of Literature Purpose The literature review section examines the importance of search studies, company data or industry reports that serve as a foundation for the setup of study. The research dimension of the related literature and the relevant information begins from an explanatory perspective, approaching towards specific studies which do related to the judge the limitations and informational gaps in data from the secondary sources. This analysis may reveal conclusions from past studies to realize the reliability of the secondary sources and their credibility. This in turn enables one to rely on a comprehensive review for the study.

Analysis of previous study A survey about current practice, which is followed in companies to appraise performance: ( Phatak, International Dimensions of Management) Almost all software companies responding do have formal appraisal programs. About 93% of smaller organizations (those with fewer than 500 employees) have such programs. About 97% of large organizations have them.

Rating scales are by far the most widely used appraisal technique. About 62% of small organization use rating scales, 20% use essays, and about 19% use MBO. Among the large organizations, 51% use rating scales, just over 23% use essays and about 17% use MBO. However, those using ratings as the main appraisal technique typically also require narrative comments to justify rating and to describe employee strengths and weakness and document development plans. Those using essays as the main appraisal

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

technique usually require an overall quantitative performance rating to facilitate employee comparisons for compensation decisions. The employee’s immediate supervisor makes Ninety two percent of appraisals. These appraisals are in turn reviewed by the appraiser’s supervisor in 74% of the responding organizations.Only about 7% of the organizations use self-appraisal in any part of the overall appraisal process.Virtually all employees (99%) are informed of the results of their appraisals. Overall about 77% are given a chance to respond with written comments on their appraisals. In 69% of companies, appraisals are done annually.

Methods of reviewing the literature The review of literature does scrutinize the important research studies. The primary sources that provide relevant information are the best form to retrieve data from the research. The primary sources were encouraged with the help of distribution of questioners as well as conducting personal interviews.

With this the data received enables the researcher to

accurately arrive at the problem of the study and the consecutively solutions to the same. The secondary sources were also relied on for additional information. It includes company journal, newsletters, records, manuals etc.

Conclusion Performance management lays an evaluative and developmental dimension to its makeup, and is crucial in both linking rewards to performance and providing a platform for the development of employees. Over concentration on the assessment of performance can work to the detriment of effort aimed at establishing the development needs of the individual in an open and honest way. The manager, as an appraiser, may encounter difficulties in reconciling the roles of 'judge' and 'mentor'. Managers need to develop the skills of coping with such tensions in their roles. In some organizations, this problem is solved by having different managers carrying out performance and development appraisals. Appraisal provides the context in which mangers can seek to ensure that there is acceptable congruency between the objectives of the individual and those of the organization.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Although one recognizes the part played by performance management in the determination of rewards, we believe that if treated as a way of providing feedback on progress and of jointly agreeing the next set of aims, the appraisal can have a positive effect on individual motivation.

2.5 Operational Definition of Concepts

Performance Appraisal

Performance appraisal is the assessment of an individual's performance in an performance in a systematic way, the performance being measured against such factors as job knowledge, quality and quantity of output, initiative, leadership abilities, supervision, dependability, co-operation, judgment, versatility etc. assessment should not be confined to the past performance alone. Potentials of the employee for the future performance must also be assessed. Performance appraisal can be defined as "the systematic evaluation of the individual with respect to his or her performance on the job and his or her potential for development". A more comprehensive definition is, “Performance appraisal is a formal structured system of measuring and evaluating an employee's job and how the employee can perform effectively in future so that the employee, organization all be benefited."

Performance appraisal, to common understanding, is the formal and informal assessment of the performance of the employee at work. In an informal system we are aware that superior is continually making judgments about their subordinates' performance on a subjective basis. By contrast, superiors could resort to using formalized appraisal techniques when assessing the performance of subordinate, and these judgments arc considered to be more objective. In formalized systems the terms 'performance appraisal and 'performance management' are used. Both refer to a process where by mangers and their subordinates share understanding about what has to be accomplished, and the manager will naturally be concerned about how best bring about those accomplishments by adept management and development of people in short and long terms. Also, performance would be measured using

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

the techniques discussed in this chapter and it will be subsequently related to targets or plans. In this way the subordinate receives feedback on his or her progress.

A distinguished feature of performance management is its integrating strength in aligning various processes with corporate objectives: for example, the introduction of performancerelated payment system and mobilization for training and development resources to achieve corporate objectives.

Measuring Performance In many organizations, the feedback on job performance is ambiguous or is given annually as a ritualistic exercise. Many subordinates therefore have trouble in gasping how their efforts are perceived by the organization. Almost every one who has worked at a job can remember times when they were unclear on how their performance was being judged. The annual performance appraisal system tends to serve only a little purpose: salary administration, training and succession planning. But this is not the sole objective of performance appraisal. These objectives will only dilute and weaken the clarity and validity of any appraisal system. Most organization ties the formal appraisal system directly to salary increase, which decrease their validity.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

It is therefore very important for organizations to: (a) Link Salary and Status Realistically to the Performance Appraisals Most personnel departments have a very narrow outlook to appraisals. The general view is to receive the appraisal forms at a date (which usually is the deadline), issue instructions regarding increments and promotions, receive the data regarding the same and they issue letters to the concerned employee informing of their salary increase. The appraisal process gets polluted as the appraiser and appraise have at the back of their minds promotion and salary increase, rather than performance plans and participative reviews. This dilutes the objectives of appraisal to great extent. In fact, if organizations create, a culture of continuous feedback on the performance they would be making the appraisal system more relevant. Several organizations have already started delinking performance appraisal from salary increase. (b) Making Objectives of Performance Appraisals Clear to All Employees If performance appraisal should not directly be linked to salary increase the question then arises, what should the objectives of performance appraisals be that could be realistically achieved? Some suggestions: 

To do joint goal setting, and link the goals to the organizational objectives



To provide role clarity by defining Key Result areas for Accounting.



To establish a level of performance in the current job and seek ways of improving it.



To identify potential for development and to support the total process of planning



To increase communication between the appraiser and the appraise.



To identify factors that facilitate performance and other factors that hinder performance.



To help the employees identify and recognize their own strengths and weaknesses. To make them assess their own competencies and how the same can be multiplied and improved.



To generate data about the employee for various decisions like transfers, rewards, job-rotation, etc.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

(c) Focus on Developmental Appraisals Managers should develop part ownership in the employee's future. Any good appraisal system should focus on developmental appraisal. Developmental appraisal mean that an organization needs to develop not just isolated performance appraisal tool/system, but the total frame work for the individuals development, improvement in job and level of competence and preparing employees for future jobs. Thus, appraisal of people, which is a part of the total HRD system, lies to be linked to long-term development activity and carrier planning. Organizations have to show vision for the future. Vision, strategies and objectives will give rise to individual objectives and performance standards. The immediate rewards and recognition do not lead to enduring performance and upgrading of competence and therefore are not real motivators. The appraisal as a tool not only gives the individual and the organization the idea of where the individual stands in terms of his skills, competencies and abilities, but also monitors the process of growth and development, together with the inputs that are required to develop a high level of competence by individuals. (d) Let Employees Appraise Their Own Performance Subordinates need feedback more often on their performance. The best way to do it is to let them appraise their own performance.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Self-appraisal would 1) Motivate the employee to take more responsibility for his/her own performance. 2) Focus on the job behavior only. 3) Reduce ambiguity in performance and focus on change in job behavior. When subordinates undertake self-appraisal, they analyze their job duties and how key issues in a job they handle. Each individual may rate himself or herself. Self-appraisal may focus on cost control, communication, planning, training, delegation and decision-making. After self-appraisal, the subordinate discusses the ratings with his/her direct report or superior to get a feed back on performance. Both then come to an agreement in areas of convergence and draw a job improvement plan. (e) Create a Climate for Open Appraisals in Organizations In most organizations, the concept of open appraisal is misunderstood. Open appraisal does nut mean that the appraisal ratings are shown by the subordinate, and his/her signature is then obtained. What it does mean that both the appraiser and the appraise share their views on performance with each other, identify the areas of improvement and work towards it. One of the objectives of open communication between the appraiser and the appraise is to bring them together to solve organizational problems and performance related problems. The quality of ratings is likely to improve if there is shared understanding between the appraiser and the appraise. (f) Muscle Builds the Organization In today's competitive world, raising performance goals is essential. This entails analyzing the company's current situation, projecting the future, establishing higher expectations, and selling the top management on the upgrading process and developing an action plan.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Muscle builds the organization by 1) Enhancing your own performance 2) Accelerating the professional growth of the best performers 3) Not tolerating managerial performers. One cannot muscle build the organization, unless marginal performers are replaced. 4) Developing multiple skills and competencies by worshiping success and potential. (g) Build Commitment in the Workplace Change is an inevitable part of manager's job. As conditions change, individual responsibilities are also expected to change. In commitment-based approach, the workplace, jobs are designed to be broader than before, team accountability is as important as individual accountability for performance. The performance expectations are high and emphasize continuous important in the workplace. Managers have to stop being my topic to performance appraisals. No personnel professional in the 90's will be able to afford the luxury of myopia. We have to see our way to the various changes in environment that are taking place and those changes that will revolutionize our organization culture in the out coming years. We must help our organization's triumphant progress through the 90s, by recognizing and rewarding performance.

METHODS OR TECHNIQUES OF APPRAISAL Broadly all the approaches to appraisal can be classified into: a) Past Oriented Methods and b) Future – Oriented Method

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

a) Past Oriented Methods 

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 scale ranges from excellent to poor. The rater checks the appropriate performance level on each criterion, and then computes the employee’s total numerical score. The number of points scored may be linked to salary increases etc. 

Checklist Under this method, a checklist of statements on the traits of the employee and his

or her job is prepared in two columns – viz., a ‘Yes’ column and a ‘No’ column. All that the rater should do is to tick the ‘Yes’ column if 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. In other words, the rater only does the reporting, while actual evaluation is done by the HR department. The HR department assigns certain points to each ‘Yes’ ticked. Depending on the number of ‘Yes’ the total score is arrived at. When points are allotted to the checklist, the technique becomes a weighed checklist. 

Forced Choice Method Here, there would be certain statements mentioned and the appraiser will only have to select the appropriate statement that suits the appraise. This is called as Forced Choice Method because here, the appraiser has no freedom at all. He only has a few statements that he will have to select that suit the appraise. The list is then forwarded to the HR Department who will do the assessment. There will be points given to each of the individual statements.



Forced Distribution Method One of the errors in rating is leniency – clustering a large number of employees

around a high point on a rating scale. The forced distribution method seeks to

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

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 levels conform to a bell – shaped curve. For example, the following distribution might be assumed to exist - excellent 10%, good 20%, average 40% below average 20% and unsatisfactory 10%. The major weakness of the forced distribution method lies in the assumption that employee performance levels always conform to a normal (or some other) distribution. In organizations that have done a good job of selecting and retaining only the good performers, the use of forced distribution approach would be unrealistic as well as possibly destructive to the employee morale. One merit of this approach is that it seeks to eliminate the error of leniency. This technique is however not acceptable by most of the rates and rates. 

Critical Incidents Method This method of employee assessment has generated a lot of interest these days. This approach focuses on certain critical behaviors of an employee that make all the differences between effective and non-effective performance of a job. Such incidents are recorded by the superiors as and when they occur. One of the advantages of this method is that the evaluation is based on actual job behavior.

Further, the approach has descriptions in support of

particular ratings of an employee. Giving job – related feedback to the rate is also easy. It reduces bias on the part of the raters. The method however has significant limitations. These include: a) Negative incidents tend to get noticed more than positive incidents. b) Recording is a chore, so supervisor could easily forget. c) Overly close supervision may result. 

Behaviorally Anchored Rating Scales (BARS)

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Behaviorally anchored rating scales, sometimes called as 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 descriptive statements of behavior on each scale best described and employee’s performance. Behaviorally anchored rating scales (BARS) have the following features: 1. Areas of performance to be evaluated are identified and defined by the people who will use the scales. 2. The scales are anchored by descriptions of actual job behavior that, supervisors agree, represent specific levels of performance. The result is a set of rating scales in which both dimensions and anchors are precisely defined. 3. All dimensions of performances to be evaluated are based on observable behaviors and are relevant to the job being evaluated since BARS are tailor made for the job. 4. 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. Superiors would feel comfortable to give feedback to the rates. Further BARS help to overcome rating errors. Unfortunately, this method too suffers from distortions inherent in most rating techniques.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION



Essay Method Here, the rater must describe the employee within a number of broad categories

such as. 1. The raters overall impression of the employee’s performance. 2. The promotability of the employee 3. The jobs that the employee is now qualified or capable to perform 4. The strengths and weakness of the employee 5. The training and development assistance required by the employee. Although, this method might be used individually, it is most frequently used in combination with others. It is extremely useful in filing information gaps about the employees that often occur in the better-structured checklist method. 

Cost Accounting Method This method evaluates performance from the monetary returns the employee

yields to his or her organization. A relationship is established between the cost included in keeping the employee and the benefit the organization derives from him or her. Performance of the employee is then evaluated based on the established relationship between the cost and the benefit.

b) Future Oriented Method 

Management by Objectives (MBO) The concept of MBO conceived by Peter F. Drunker, reflects a management

philosophy which values and utilized employee contributions. Applications of MBO in the field of performance appraisals are a recent thinking. The working of MBO can be described in four steps: The first step is to establish the goals each person is to attain. These goals can be used to evaluate employee performance. The second step involves setting the performance standard for the subordinates in a previously arranged time period. As subordinates perform, they know fairly well what there is to do, what has been done and what remains to be done.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

The third step, the actual level of goal attainment is compared with the goals agreed upon. The evaluator explores reasons for the goals that were not met and for the goals that were exceeded. This step helps determine possible training needs. It also alerts the superior to conditions in the organization that may affect a subordinate but over which the subordinate has no control. The final step involves establishing new goals and possibly, new strategies for goals not previously attained. 

Psychological Appraisals Large organizations employ full time industrial psychologists.

When

psychologists are used for evaluations, they assess an individual’s future potential and not past performance. The appraisal normally consists of in-depth interviews, psychological tests, discussions with superiors and a review of other evaluations. The psychologist then writes an evaluation of the employee’s intellectual, emotional, motivational and other related characteristics that suggest individual potential and my predict future performance. The evaluation by the psychologist may be for a specific job opening for which the person is being considered, or it may be a global assessment for his or her future potential. From these evaluations, placement and development decisions may be made to shape the person’s career. 

360 Degree Appraisal This is a technique of appraisals wherein multiple rates are involved in evaluating

performance. This is understood as a systematic collection of performance data on an individual or group, derived from a number of stakeholders – the stakeholders being the immediate supervisors, team members, customers, peers and self. In fact, anyone who has any information on ‘how an employee does the job’ may be one of the appraisers.

This provides a broader perspective about an employee’s

performance. In addition, the technique provides for greater self-development of the employees. For an employees development multi-source feedback is very useful as it enables the employee to compare his or her perceptions of self with the perceptions of others.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

360-DEGREE FEEDBACK DEFINED 360° feedback is a relatively new feature of performance management. 360° feedback has been defined by Ward (1995) as: The systematic collection and feedback of performance data on an individual or group derived from a number of stakeholders on their performance. The data is usually fed back in the form of ratings against various performance dimensions. 360° feedback is also referred to as multi-source assessment or multi-rater feedback.

360-DEGREE FEEDBACK – METHODOLOGY 1. The Questionnaire 360° feedback processes usually obtain data from questionnaires, which measure from different perspectives the behaviors of individuals against a list of competencies. The competence model may be developed within the organization or the competency headings may be provided by the supplier of the questionnaire. The dimensions may broadly refer to leadership, management and approaches to work.

2. Ratings Ratings are given by the generators of the feedback on a scale against each heading. This may refer both to importance and performance, as in the questionnaire, which asks those completing it to rate the importance of each item on a scale of 1 (not important) to 6 (essential) and performance on a scale of 1 (weak in this area) to 6 (outstanding).

3. Data Processing Questionnaires are normally processed with the help of software developed within the organization or, most commonly, provided by external suppliers. This enables the data collection and analysis to be completed swiftly, with the minimum of effort and in a way that facilitates graphical as well as numerical presentation.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

4. Feedback The feedback is often anonymous and may be presented to the individual (most commonly) to the individual’s manager (less common) or to both the individual and the manager. Some organizations do not arrange for feedback to be anonymous. Whether or not feedback is anonymous depends on the organization’s culture – the more open the culture, the more likely is the source of feedback to be revealed.

5. Action The action generated by the feedback will depend on the purposes of the process, i.e. development, appraisal or pay. If the purpose is primarily developmental, the action may be left to individuals as part of their personal development plans, but the planning process may be shared between individuals and their managers if they both have access to the information. Even if the data only goes to the individual, it can be discussed in a performance review meeting so that joint plans can be made, and there is much to be said for adopting this approach.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

360-Degree Feedback – Advantages and Disadvantages 

Individuals get a broader perspective of how they are perceived by others than previously possible.

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Increased awareness of and relevance of competencies

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Increased awareness by senior management that they too have development needs.

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More reliable feedback to senior managers about their performance.

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Gaining acceptance of the principle of multiple stakeholders as a measure of performance.

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Encouraging more open feedback – new insights.

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Reinforcing the desired competencies of the business.

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Provided a clearer picture to senior management of individual’s real worth (although there tended to be some ‘halo’ – effect syndromes).

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Clarified to employee’s critical performance aspects.

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Opens up feedback and gives people a more rounded view of performance than they had previously.



Identifying key development areas for the individual, a department and the organization as a whole.



Identify strengths that can be used to the best advantage of the business.



A rounded view of an individuals / teams / the organization performance and what its strength and weakness are



It has raised the self awareness of people managers of how they personally impact upon others – positively and negatively



It is supporting a climate of continuous improvement



It is starting to improve the climate / morale, as measured through out employee opinion survey



Focused agenda for development. Forced line managers to discuss development issues.



Perception of feedback as more valid and objective, leading to acceptance of results and actions required.

But there may be problems. These include:

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

 People not giving frank honest feedback;  People being put under stress in receiving or giving feedback;  Lack of action following feedback;  Over-reliance on technology  Too much bureaucracy These can all be minimized if not avoided completely by careful design, communication, training and follow-up.

360-DEGREE FEEDBACK – CRITERIA FOR SUCCESS 360-Degree is most likely to be successful when;  It has the active support of top management who themselves take part in giving and receiving feedback and encourage everyone else to do the same.  There is commitment everywhere else to the process based on briefing, training, and an understanding of the benefits to individuals as well as the organization.  There is a real determination by all concerned to use feedback data as the basis for development.  Questionnaire items fit or reflect typical and significant aspects of behavior.  Items covered in the questionnaire can be related to actual events experienced by the individual.  Comprehensive and well-delivered communication and training programs are followed.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

APPRAISAL ERRORS None of the methods for appraising performance is absolutely valid or reliable; each method has its own strengths and weakness. Let us try to understand the most commonly occurring errors within performance appraisal methods.

1. Error of Central Tendency: This refers to the tendency of not using extreme scale scores on the judgment scale; most of the rates are clustered in the middle.

2. Error of Leniency: This is caused by the tendency of the lenient rater to put most of the rates on the higher side of the scale, while a tough rater places them on the lower side of the scale.

3. Halo Effect: In other words, it is tendency to allow the assessment on one trait to influence assessment on others. This usually arises when traits are unfamiliar, ill – defined and involved personal reactions.

4. Error in Unreliability: This error occurs when there is the existence of inconsistency in the evaluations of a group of employees by two / more appraisers.

5. Personal Bias: This error occurs when there exists a close relationship between the appraiser and the appraise. This tends to influence the evaluation. The scores could be on the higher when there would be a bias on the side of the appraiser. Therefore, the scores given could tend to be higher then what the appraise deserves. This would give the appraise an undue advantage for the appraise during the times of promotions, pay rise etc. the same could happen vice versa too if an appraiser does not share a good relationship with the appraise, he could tend to give absolutely low scores for the appraise.

5. No Consultation

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

There would tend to be an error in the scores if the appraiser just goes on giving scores without discussing with the appraise. If the appraise would not be given his say in the matter, the score will not reflect the actual capability of the appraise.

6. Spill over Effect This refers to allowing past performance appraisal ratings to unjustifiably influence current ratings.

7. Status Effect: It refers to over rating of employed in higher level job or jobs held in high esteem, and under rating employees in lower level job at job held in low esteem.

2.6 Research methodology Type of Research The research design comprise of the plan and structure of investigation conceived so as to arrive at the responses to the research queries. It there by addresses the aims and objectives of the study, both descriptively and analytically.

Sampling Technique The sampling technique adopted for the study is non-probability Random sampling technique according to the convenience of the researcher. A questionnaire was administered to HR managers / executives of different software companies to obtain data for the purpose of analysis.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Sample Size Data is collected using a sample of 30 software companies.

Sample Description The sample mainly consists of data from the primary sources that are utilized for the purpose of this study.

This is done by means of administrating questioners to human

resource managers / executives in different software companies in the city of Bangalore. Secondary data like company journals, newsletters, records etc. were also relied on for retrieving further information.

Instrumentation Technique Questionnaire and structure disguised questions.

Actual Collection of Data Both secondary and primary sources of data are utilized for the purpose of this study. Primary data is collected by means of administering a questionnaire to the Human Resource Managers / Executives in different software companies. Secondary data is collected from various records, manuals and other sources of the HR Department.

Tools used for testing of hypothesis In attempting to arrive at a decision about the population on the basis of the sample information it is necessary to make assumptions or guesses about the population parameters involved such an assumption is called statistical hypothesis, which may or may not be true or not is called test of hypothesis or test of significance. In the test of hypothesis it begins with an assumption or hypothesis is called Null Hypothesis. The null hypothesis asserts that there are no significant differences between the statistics and the population parameters and whatever observes difference is there merely due to fluctuations in sampling from the sample population. Null hypothesis is usually denoted by the symbol, Ho. Any hypothesis that contradicts the Ho (null hypothesis) is called an alternative hypothesis and is denoted by symbol H1. hypothesis is Test for proportion.

The technique used to test the

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Test for Proportion Suppose the population of an attribute in a population is now known, we want to test whether the proportion is a given value P. The null hypothesis is Ho : p = P. The alternative hypothesis is H1: p  P. The large random sample of size n from the population, let x units possess the attribute. Then the sample proportion is p = x/n.

And so, Z =

p-P

 PQ n Therefore, the test statistics is | Z | =

P = assumed level of effectiveness Q = 1-P p = level of effectiveness of sample n = sample size

For the sample, if | Z | cal > k, Ho is rejected .On the other hand, if | Z | cal < Ho is accepted.

Other Software used for the data analysis For the data analysis, and the subsequent interpretation the researcher has adopted advanced version of MS-EXCEL 2000.

This application software has facilitated the

researcher to construct the frequency table, various kinds of graphs and to find out the average responses from the sample. By this automated data analysis it has minimized the researcher’s time constraint and reduced human errors and also accurate outlay of information.

PROFILE OF SOFTWARE INDUSTRY

SOFTWARE INDUSTRY

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

3.1 Indian IT - ITES Industry: The Indian IT-ITES industry is broadly categorized into IT services and software, ITES-BPO and Hardware segments. The industry continues to chart remarkable double-digit growth, with industry aggregate revenue for 2005-06 expected to reach US$ 28 billion. The industry is forecast to grow more than fivefold over FY 1999-06, at a CAGR of 28 percent. 3.2 Industry Trends (2004-05) 

The earnings from IT-ITES exports was US$ 13.3 billion (61.9 percent of total industry revenues) in 2004-05 and is expected to touch US$ 17.9 billion (63.7 percent) in 2005-06. Key drivers of growth include the growing adoption of IT outsourcing and the rapid expansion in the scale and breadth of ITES-BPO offerings by Indian vendors. o

During 2005-06, software and services, and ITES-BPO would continue to remain the key contributors to India’s IT-ITES export revenues, with a share of 67.8 percent and 28.4 percent, respectively. While contribution of hardware exports would be around 3.7 percent, the situation is expected to change in the medium term, with this segment receiving a boost owing to market conditions.

o

Overall pricing levels in IT services stabilized at US$ 55-60 per hour for onsite services and between US$ 18-24 per hour for offshore services.

o

Indian IT-ITES vendors successfully executed the offshore delivery model to achieve sustained growth in service exports and established India as the most preferred offshore destination for global sourcing of services.



Indian IT-ITES vendors successfully executed the offshore delivery model to achieve sustained growth in service exports and established India as the most preferred offshore destination for global sourcing of services.



The domestic IT-ITES market witnessed a revival during 2004-05, with revenues reaching US$ 8.2 billion (a growth of 30 percent over previous year). The segment is expected to touch revenues of around US$ 10.2 billion during 2004-05, at a CAGR of 19.2 percent for the 2004-05 periods. Hardware and IT services accounted for around

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

90 percent of the domestic IT-ITES revenues during 2004-05 and this market share is not likely to change in 2004-05. o

The BFSI (Banking, Financial services, Insurance), Government and telecom segments remained the key revenue drivers for the domestic IT-ITES market.



Two more companies within the IT-ITES domain joined the billion-dollar club, which now includes the HCL Group, Infosys, TCS and Wipro.



During 2004-05, the Indian IT software and services segment added 98,000 jobs and the ITES-BPO sector added about 73,500 jobs. A total of 203,5000 new jobs are likely to be created by the IT-ITES sector in the current fiscal.



Indian IT-ITES vendors focused on improving productivity and utilization and moved up the value chain. While IT service companies included new service lines such as package software implementation, systems integration, R&D engineering and remote network management to their portfolio of offerings, ITES-BPO companies began more complex services such as financial research and analytics, actuarial modeling, corporate and business research.

The Indian IT-ITES players expanded their focus from the Fortune 500 companies to address the needs of Global 2000 corporations.

Bangalore - The "Technopolis" of India A large part of India's success in the software sector is due to the crucial role played by the State of Karnataka in promoting and providing a boost to IT. Karnataka has emerged as the computer capital and center of high-tech industries, especially software. Bangalore has for long been known as India's answer to Silicon Valley, and this is the city where most large software companies have set up shop and operate out of state-of-the-art facilities. This is the reason why it is fast becoming the "Technopolis" of India. The Government of Karnataka has also been extremely positive about the software and services marketplace and has helped

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

create the relevant telecom and policy infrastructure conducive to the growth of this sector. The dynamic industrial policy declared in 1996, with comprehensive packages of incentives and concessions, has ensured a productive ground for various industries. The hardware and software industries have now brought about a revolution of sorts under these schemes. Various institutions and computer training centers have contributed to the large number of trained and talented professionals. The City of Bangalore has positioned itself to help market the software industry. This is also why Bangalore has been playing host to international-class conferences, workshops and exhibitions devoted to the software cause. The city has the highest number of engineering colleges in the world, almost 50 percent of the world's SEI CMM Level 5 companies; COPC/ISO recognized Customer Interaction Centers, and over 103 R&D Institutions. It is, in fact, home to GE's biggest R&D Center outside the U.S.-the Jack Welch Technology Center, which hires over 200 PhDs/scientists every month! To top it all, Bangalore has just been ranked the fourth best "Global hub of technological innovation" by none other than the United Nations. Bangalore's strengths in the software market also lie in its pursuit of new opportunities. In fact, two key segments that are expected to open up over the next few years for India are e-commerce and remote processing. Opportunities in e-commerce software solutions are emerging as a major area of growth in the Indian IT software and services industry. A recent study undertaken by The Boston Consulting Group for NASSCOM clearly stated that India could earn revenues of US$9 billion from e-business solutions by 2005. .

Various Approaches Of Performance Appraisal

The data was processed after collection and analyzed for the purpose. The data was edited, classified and tabulated for analysis. Analysis of data was done with the purpose of summarizing the collected data and organizing these in such a manner that they answer the research questions. Percentage

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

analysis was used for analysis of data and the results have been presented by way of pie charts, bar charts, with the help of SPSS package. After analysis, the phase of interpretation starts. This is done by drawing inferences from analyzed data. After interpretations, a report was prepared on the basis of inferences.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Table 4.1

Distribution of companies according to the total no of Employees Total no of employees Upto 100 100 – 1000 Above 1000 Total

Frequency Percent 9 30.0 16 53.3 5 16.7 30 100.0

Cumulative Percent 30.0 83.3 100.0

Source – Primary Data

Interpretation: The above table indicates that 9 companies were selected who employed 100 and below employees. 16 companies employed between 100 and 1000 employees and only 5 companies were selected who employed above 1000 employees.

Graph 4.1Indicates the total number of employees in the organization

Total no.of employees Above 1000 Upto 100

100 - 1000

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Table 4.2 Type of Appraisal System Frequency Type of Appraisal System Manager, Supervisor,Appraisers Self appraisal open system MBO 36Feed Back 5 Point Scale 3.point Scale 4.Point scale 10 Point scale Total

11 6 4 3 2 1 1 1 1 30

Percent Cumulative Percent 36.7 20.0 13.3 10.0 6.7 3.3 3.3 3.3 3.3 100.0

36.7 56.7 70.0 80.0 86.7 90.0 93.3 96.7 100.0

Source – Primary Data

Interpretation The above table indicates that 36.7% of the companies are appraised by the managers/supervisors/appraiser assessment, 20% of the companies emphasis on self assessment, in addition to this few companies follow Open System (13.3%), MBO (10%), 360 feed back (6.67%), 5 point scale (3.3%), 3 point scale (3.3%), 4 point scale (3.33%) and 10 point scale (3.33%). Graph 4.2 Indicates the type of appraisal system adopted by the software companies

Type of Appraisal System 10 Point scale 4.Point scale 3.point Scale 5 Point Scale 36Feed Back

Manager,Supervisor,A

MBO

open system Self appraisal

Table 4.3 Frequency of Appraisal

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Period Frequency Percent Quarterly 14 46.7 Half 6 20.0 Yearly Annually 4 13.3 Others 6 20.0 Total 30 100.0

Cumulative Percent 46.7 66.7 80.0 100.0

Source – Primary Data

Interpretation From the above table most of the companies follow the annual system of appraisal (46.7%). Half yearly appraisal is carried out in 20% of the companies. 13.3% follow quarterly system of appraisal. Some companies follow the combination of half yearly and annual system (16.7%). Only 3.33% of the companies followed half yearly + quarterly + annual system of appraisal. Graph 4.3Indicates how often appraisals are carried out by the companies

Frequency of Appraisal Others

Quarterly Annually

Half Yearly

Table 4.4 Criteria used for evaluation Criteria Performance

Frequency Percent 12 40.0

Cumulative Percent 40.0

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

customer Focus Technical Competence Attendance Target Vs. Achievement Key Result Areas Quality of Output 3 Point Scheme Total

6 4 3 2 1 1 1 30

20.0 13.3 10.0 6.7 3.3 3.3 3.3 100.0

60.0 73.3 83.3 90.0 93.3 96.7 100.0

Source – Primary Data

Interpretation The above table indicates the criteria used in evaluating the employees.

40% of the

companies evaluate their employee with the performance, 20% by the technical competence, 13.33% by the target v/s achievement, 13.33% by quality of output, 6.67 by customer focus, 3.33% on attendance, 3.33% by the key result area and 3.33% by the 3 point scale. Graph 4.4

Criteria used for evaluation 3 Point Scheme Quality of Output Key Result Areas Target Vs. Achieveme Performance

Attandence

Technical Competence

customer Focus

Table 4.5 Rating System used by S / W Companies

Rating Frequency Percent system Scoring 9 30.0 Comments 6 20.0 Both 15 50.0

Cumulative Percent 30.0 50.0 100.0

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Total

30

100.0

Source – Primary Data

Interpretation The above table indicates that 30% of the companies use scoring as the rating scale, 20% on comments and 50% of the companies use both scoring and comments as rating scale. Graph 4.5 Rating scale used in software companies

Rating System used by S/W Companies Scoring

Both

Comments

Table 4.6 Percentage if scoring is the Rating Scale Scoring Frequency Percent Alpha 7 23.3 Numeric 14 46.7 Both 3 10.0 Total 24 80.0 System 6 20.0 30 100.0

Cumulative Percent 29.2 87.5 100.0

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Source – Primary Data

Interpretation From the above table the companies, which follow scoring as rating scale use 23.3% alpha, 46.7% numeric and 10% both alpha and numeric. Graph 4.6 if scoring is the rating scale

Percentage if scoring is the Rating Scale Missing

Alpha

Both

Numeric

Table 4.7 Feedback to employees after Appraisal Feedback Frequency Percent Yes 26 86.7 No 4 13.3 Total 30 100.0

Cumulative Percent 86.7 100.0

Source – Primary Data

Interpretation The above table indicates that 86.67% of the employees appraised received feedback and 13.33% employees did not receive feedback.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Graph 4.7 whether the person being appraised obtain feedback

Feedback to employees after Appraisal No

Yes

Table 4.8 Percentage of Feedback given to Employees

Feedback Frequency Percent Written 9 30.0 Oral 7 23.3 Detailed 5 16.7 Summarized 3 10.0 Self-Assessed 3 10.0 Manger Assessed 3 10.0 Total 30 100.0

Cumulative Percent 30.0 53.3 70.0 80.0 90.0 100.0

Source – Primary Data

Interpretation The above table indicates how feedback is given to the employees. Most companies follow a written feedback with 30.00%, oral being 10%, manager assessed 10%, self assessed

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

16.67%, detailed 23.33% and summarized being 10%. Almost all the companies that were sampled followed a combination of more than one type of feedback. Graph 4.8How feedback is given to the employees

% of feedback given to Employees Manger Assessed Self-Assessed

Written

Summarized

Detailed

Oral

Table 4.9 Percentage of Positive or Negative Feedback Feedback Frequency Percent Yes 26 86.7 No 4 13.3 Total 30 100.0

Cumulative Percent 86.7 100.0

Source – Primary Data

Interpretation The above table indicates that 86.67% companies follow the sharing of feedback both positive and negative in the same meeting while 13.33% said no. adverse was communicated in writing and good performance is already known.

Graph 4.9 whether the negative and positive feedback is shared with the appraise in the same meeting.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

% of Positive & Negative feedback No

Yes

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Table 4.10 Self-Assessment Self- Assessment Frequency Yes 21 No 9 Total 30

Percent Cumulative Percent 70.0 70.0 30.0 100.0 100.0

Source – Primary Data

Interpretation The above table indicates that 70% of the companies follow self assessment of an employee while 30% did not follow.

Graph 4.10 whether the self-assessment of employee is followed in the company or not.

Self-Assessment No

Yes

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Table 4.11 Percentage of Company following Self-Assessment. Self- Assessment Yes No Total System

Frequency Percent 18 60.0 3 10.0 21 70.0 9 30.0 30 100.0

Cumulative Percent 85.7 100.0

Source – Primary Data

Interpretation The above table states the integration of the self-assessment of an employee in the existing appraisal system, 85.71% said yes and 14.29% said no.

Graph 4.11 If the company follows a self-assessment of an employee, is it integrated in the appraisal system followed?

% of company following Self-Assessment Missing

Yes No

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Table 4.12 Percentage of Compensation increase Compensation Frequency Yes 25 No 5 Total 30

Percent Cumulative Percent 83.3 83.3 16.7 100.0 100.0

Source – Primary Data

Interpretation The above table indicates that 83.33% of the companies agreeing that appraisal are related to compensation increase and 16.67% did not agree. Graph 4.12 Relation of performance appraisal in compensation increase

Percentage of Compensation increase No

Yes

Table 4.13 Compensation increased and Appraisers set targets

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Compensation Frequency Percent Yes 22 73.3 No 8 26.7 Total 30 100.0

Cumulative Percent 73.3 100.0

Source – Primary Data

Interpretation The above table indicates that 73.33% of the respondents agreeing to setting targets to employees being appraised while 26.67% said no.

Graph 4.13 The sets target for an employee being appraised

Appraiser's set targets. No

Yes

Table 4.14 Distribution of set target

Distribution Frequency Percent Cumulative Percent 3 Months 2 6.7 9.1

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

3 - 6 Months 6 Months 12 Months Total System

2 4 14 22 8 30

6.7 13.3 46.7 73.3 26.7 100.0

18.2 36.4 100.0

Source – Primary Data

Interpretation From the above table, half (15) of the companies, the appraiser sets targets for an employee being appraised for a period of 12 months (50%), in other companies the targets are set for 6 months (20%), 3-6 (20%) and 3 months (10%).

Graph 4.14 If the appraiser sets targets, for what period the targets are set.

Distribution of set target Missing

3 Months 3 - 6 Months

6 Months

12 Months

Table 4.15 Usage of checklists in Appraisals Check List Frequency Percent Cumulative Percent Yes 23 76.7 76.7 No 7 23.3 100.0 Total 30 100.0

Source – Primary Data

Interpretation

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

The above table indicates that 76.67% of the companies (23) have a checklist for carrying out appraisals while 23.33% said no. Some companies have a performance appraisal handbook, which gives the details. One of the companies has an IT Tool as checklist.

Graph 4.15 Do the companies have a checklist for carrying out appraisal

Usage of checklists in Appraisals No

Yes

Table 4.16 Is Career Planning effective Career Planning Frequency Yes 19 No 11 Total 30

Source – Primary Data

Interpretation

Percent Cumulative Percent 63.3 63.3 36.7 100.0 100.0

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

The above table indicates that out of 30 companies 19 companies feel that career planning place an important role in Performance Appraisal (63.33%) and rest of the 11 companies do not agree with this (36.36%).

Graph 4.16 Effectiveness of 360 degree appraisals.

Is Career Planning effective No

Yes

Table 4.17

Effectiveness of 360 degree appraisal Parameters Frequency Percent Cumulative Percent Less than 20% 1 3.3 3.3 20% - 35% 3 10.0 13.3 35% - 50% 5 16.7 30.0 Above 50% 21 70.0 100.0 Total 30 100.0

Source – Primary Data

Interpretation From the above table, it is understood that when 360 score is implemented as a form of appraisal so as to realize its effectiveness in a firm, almost above 50% opts it to be very effective, with a score of 70% while 35-50% and 20%-35% votes its effectiveness up to a level of 16.67% and 10% respectively and less than 20% declares it least effective, i.e. 3.33%.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION 0

Graph 4.17 The level of effectiveness of 360 score when implemented as a

form of appraisal.

Effectiveness of 360 degree appraisal Less than 20% 20% - 35%

35% - 50%

Above 50%

Table 4.18 Distribution Of Companies according to the total no. of employees Companies Per. Small Medium

9 (100) 3 (18.8)

Distribution of Companies according to the total no of Employees Cus. KRA’s Quality 3Point Tech. Atten. Tar. Focus Competence Vs. Of Scheme Acheiv. Output 6 (37.5)

4 (25)

Total

2

1

1

1

9 (100) 16 (100) 5

3 (18.8)

Large

Total

12

6

4

3

(40) 2

(20) 1

(20) 1

(20) 1

(100) 30

40%

20%

13.3%

10%

6.7%

3.3%

3.3%

3.3%

100%

Note: Figures in brackets indicates percentage to total. Source – Primary Data

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Interpretation From the above table it can be inferred that the criteria used to evaluate an employee for a Small Company is performance (100%) but for a Medium Company it is performance(18.8%),customer focus(37.5%), technical competence(25%) and attendance(18.8%). And finally for a Large Company the criteria include target Vs. achievement(40%),Key Result Areas(20%), quality of output(20%) and 3Point scheme(20%)

Table 4.19 Type of Appraisal System adopted and the frequency of Appraisal Appraisal Quarterly Manager Supervisor Appraiser Self-Appraisal

(100) 3

(100) 6

3 (50) 3

1

(100) 4

(75) 3

(100) 3

(100) 360 Feedback 5Point Scale 3Point Scale

Total 11

(75) MBO

Others

11

(50) Open System

Frequency Half Annually Yearly

2

(100) 2

(100) 1

(100) 1

(100) 1

(100) 1

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

(100) 1

4point Scale

(100) 1 (100)

(100) Total

14

6

4

5

30

(46.7)

(20)

(13.3)

(16.7)

(100)

Note: Figures in brackets indicates percentage to total. Source – Primary Data

Interpretation This table indicates that the Organization carries out appraisals for QuarterlyManagers/Supervisors/Appraisers, Self-Appraisal- Quarterly as well as Half-yearly(50%). Open system which is carried out half-yearly and annually. Where as 360Degree feedback, 5Point Scale, 3Point Scale, 4Point Scale follow other Appraisal System

Table 4.20 Adoption of Performance Appraisal and percentage of Feedback given to employees. Companies

Written

Oral

Detailed

Feedback Summarized

SelfAssessed

Manager assessed

9

Total 9

Small (100) (100) Medium

7

5

3

1

16

(43.8)

(31.3)

(18.8)

(6.3) 2

3

(100) 5 (100) 30

Large 9

7

5

3

(40) 3

(60) 3

(30)

(23.3)

(16.7)

(10)

(10)

(10)

Total

Note: Figures in brackets indicates percentage to total. Source – Primary Data

Interpretation

(100

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

This table indicates how feedback is obtained from the employee, ie., Oral(23.3%), Written(30%), Detailed(16.7%), Summarized(10%), Self-Assessed(10%), Manager Assessed(10%) which holds good for Small, Medium and Large Companies.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Table 4.21 Performance Appraisal System and the effectiveness of 360Degree feedback

Appraisal

Total

Less Than 20% 1

Effectiveness of 360Degree Appraisal 20%-35% 35%-50% Above 50%

Total

3

5

21

30

(3.3) 1

(10) 3

(16.67) 5

(70) 21

(100) 30

(3.3)

(10)

(16.7)

(70)

(100)

Note: Figures in brackets indicates percentage to total. Source – Primary Data

Interpretation This table shows how effective and feasible the 360Degree Appraisal format applies to the Companies broken up into segments of : less than 20%, in between 20%-35%, 35%-50%, Above 50%

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Table 4.22 The level of effectiveness of 3600 appraisals Effectiveness

Percentage Of Company

Less than 20%

No. of Company

3.33%

1

20%-35%

10%

3

35%-50%

16.67%

5

50% and Above

70%

21

TOTAL

100%

30

Source: Primary Data Ho: The Level of effectiveness of 3600 appraisals is less than 50% H1: The level of effectiveness of 3600 appraisals is more than or equal to 50% Level of Significance, 0.05 Z=

p-P √ PQ n

p= X /N = 21 / 30 X= number of respondents saying the effectiveness of 3600 appraisals is more than or equal to 50% n = total number of respondents ie; 30 P = assumed level of effectiveness i.e., 0.50 Q = 1-P Q = 1 - 0 .50 = 0.50 Z=

0.7 – 0.5 √ 0.5 * 0.5 30

Z = 2.191 Calculated Value |Z| cal: 2.191

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Table Value |Z| tab: 1.645

Inference Since the |Z| cal > Z tab, the researcher has to reject Null hypothesis at 5% level of significance and the researcher can conclude that the level of effectiveness of 3600 appraisal is more than or equal to 50% (H1).

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

5.1FINDINGS The following findings have been derived from the study conducted. The most common appraiser is the manager/supervisor/appraiser. The self-appraisal of an employee is emphasized. Most of the companies followed a combination of self-appraisal and manager assessment. The positive areas/benefits of the appraisal system followed in software companies are inputs for training and development, career planning and development. There is an opportunity for free and regular feedback because of the open and transparent system. The manager appraisal and self-appraisals help in comprehensive results, due to the appraisals there is scope for the growth of the employee and organization. There is benefit of the objective setting for next six months. A clear distinction between performers and non-performers is possible. Appraisal on performance as well as values makes it a positive area where it makes it punctual and efficient. All variables are easily quantified into a meaningful exercise and objective with work behavior, helping qualitative contribution in building culture. The criteria / measures to evaluate an employee in most of the companies are technical competence, performance, work knowledge, achievement vs. objectives, contribution coding standard, common working capital, key result areas set at the beginning of a specific period forming the result-oriented areas, leadership skills, teamwork, attitude, communication, value system, conflict management, interpersonal skills, and dependability forming the behavior-oriented areas in most of the companies. The rating system used in most of the companies is both scoring and comments with numeric-type widely used and a few companies use both alpha and numeric type of scoring.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Majority of the companies obtain feedback on the person being appraised. Manager gives the feedback in most cases while peer and mixed is used in few cases. 360° feedback is followed in a lesser percentage of companies. Reverse appraisal, slab-not time based is prevalent in a few companies. Feedback is given in the written form, manager assessed and self-assessed in most cases while summarized in few cases. There is a combination of the type of feedback given to the employers. Both positive and negative feedbacks are shared in the same meeting with appraise. Almost all companies follow a self-assessment of an employer, which is integrated, into the appraisal system followed. In majority of the companies, the appraisal by the manager and self-sources are protected, the manager assessment in a few companies the sources are protected. Compensation increase is related to performance and depends on the performance code/rating given. If the appraise scores beyond the cut-off score based on the grades, a raise is given. It is related to the increment and project allowance. The appraiser sets targets for the employee being appraised for a period of six months, 12 months and three months being lease. Targets are tracked by constant monitoring, appraisal at the end of the project, input form customer, six months reviews, weekly reports, by revenues and assignments. A checklist for carrying out appraisal is followed in many companies. Career planning is followed in most companies for two to three months, six months, project completion time, and current estimated potential. The appraisal system is manual with a few companies following automated and few both. The benefits of 360° feedback are that it gives an all round perspective restricting the inconsistency factors that exists in traditional appraisal system. Evaluation and feedback is more comprehensive and complete. It removes a lot off friction down the line improving boss-subordinate relation. The limitations because of 360° feedback is not directly appreciated and not well taken in application-oriented areas. Most companies’ have not implemented the system as it consumes more time.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

The 3600 feedback is an appropriate system to use as it helps the appraise to know the areas to be focused for development. An appropriate system should be an open system, system that link reward / recognition and pay for performance. It should provide for two-way feedback, reduce subjectivity judgment factor. Most of the software companies are in the verge of implementing 3600 feedback processes in the near future.

5.2 RECOMMENDATIONS During the study, distribution of the questionnaire and conducting of personal interviews did help to arrive at the standards of appraisal system adopted by the software industry in the city of Bangalore. Appraisal systems are a very effective means to realize the growth of a company and its employees. Hence, it is considered to be important for the development of the industry. From the appraisal systems, the 3600 are the most preferred by a majority of them.

5.3 CONCLUSION The major implications are to know the different appraisal systems adopted in the software industry and its level of effectiveness when implemented in the various organizations. From the research, certain suggestions could be arrived at with the help of available and relevant data. This in turn could enable one to understand the growth and development of a company and that of its employees. The common type of appraisal system is the open system and the management by objectives; some of the companies followed the 360-feedback process. The point-based system of appraisal is also very popular among the software companies, with the 5-point scale being widely used. One of the companies followed personal interaction evaluation personal business commitment program. None of the companies followed one single system

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

of appraisal. Performance appraisal is followed in most of the companies annually and half yearly while a less percentage follows the quarterly system. A combination of half-yearly and annual system is followed. No appraisal system is free from limitations as it is very subjective. The rating by peer and subordinates is not followed which is shortcoming. Absence of project end reviews poses as a limitation. Implementation may not be as planned because of time constraints and span of reports. Over a period of time, appraisal becomes a ritual because of a lot of distrust and employees being scared of the process.

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

Ashwathappa K. Human Resource and Personnel Management. TATA McGraw Hill, 1997. Monappa Arun and Mizra S. Saiyadin. Personnel Management, TATA McGraw Hill, 1997. Krishna Swami O.R. Methodology of Research in Social Science. Himalaya Publication, 1997. Rudrebasavaraj M.N. Dynamic Personnel Administration management of Human Resourse. Himalaya Publishing House, 1996. Edwards, R.Mark. 360Degree Feedback: The powerful new model for Employee Assessment and Performance management.US Publication, 1996. Martin Fischer. Performance Appraisal. Sunday Times Business Skills, 1996.

QUESTIONNAIRE

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

I am a final year MBA student of Kristu Jayanti College Bangalore, conducting a research on Appraisal Systems. This project is in partial fulfillment of my MBA program. Your participation ill be greatly appreciated in this research effort; the responses will be kept confidential and only be used in an aggregate manner. Name of the Organization: Designation: Total No. Of employees in the Organization 1. Do you appraise an employee by an appraisal system? Yes

No

2. If yes, what is the system of appraisal adopted by your company? 3. How often are appraisals carried out in your organization? Quarterly

Half Yearly

Annually

Others (Please Specify)

4. What are the criteria used in your company to evaluate an employee? Performance

Customer Focus

Technical Competence

Attendance

Target Vs. Achievement

Key Result Areas

Quality of Output

3 Point Scale

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

5. What is the rating system used in your company? Scoring

Comments

Both If scoring is it Alpha

Numeric

Both 6. Do you obtain feedback on the person being appraised? Yes

No

7. How is feedback given to the employees? Written

Oral

Detailed

Summarized

Self-Assessed

Manager Assessed

8. Do you share both positive and negative feedback with appraise in the same meeting? Yes

No

9. Do you follow a self-assessment of an employee? s

No

a) If yes, is it integrated into the appraisal system you follow? Yes

No

10. Is compensation increase related to an appraisal in any way? Yes

No

11. Does the appraiser set targets for an employee being appraised? Yes

No

If yes, for what period? 3 Months

3-6 Months

6 Months

12 Months

12. Do you have a checklist for carrying out appraisals? Yes

No

PERFORMANCE APPRAISALS AND EVALUATION OF EMPLOYEE SATISFACTION

13. Do you follow career planning? Yes

No

14. What would be the level of effectiveness of 360 score when implemented as a form of appraisal? Less than 20%

20% - 35%

35% - 50%

above 50%