Main proj

Summer Training Project Report ON

EFFECTIVENESS OF PERFORMANCE MANAGEMENT SYSTEM OF NTPC

Submitted in Partial fulfillment of requirement of award of MBA degree ofGGSIPU, New Delhi

Submitted By Nidhi Aggarwal 04715603911 Third semester 2011 Batch

Northern India Engineering College(Affiliated to GGSIPU)

FC-26, Shastri Park, Delhi-110053

Acknowledgement

To accomplish a project work like this efforts of many people are required and ours is not an exception, a number of people have helped us. First of all we would like to thank Sri S.R Sahoo (manager-HR (RECIT),Mr Chandramauli(Senior manager-HR-Wages). I convey our special thanks to Miss Pratibha(Sr. Manager-HR(wages)) for her guidance during the course of our project study and all those persons who helped us in getting grass root information about NTPC and the performance management system working there, from whom we received valuable co-operation, useful suggestions and relevant data and information pertaining to our project and responses to questionnaire. We are thankful to all of our friends who have been a source of motivation to us. At last but not least we convey our heartily gratitude to our MBA H.O.D Mr D.K Gupta and all the faculty members of MBA program, N.I.E.C for their constant guidance and help. Finally we thank God who blessed us in our endeavor.

Nidhi Aggarwal MBA-HR (20011-2013) MBA program, N.I.E.C Shastri Park

INDEX

S.NO TOPIC PAGE NO. SIGNATURE

1. Acknowledgement

2. Index

3. Objectives of the study

4. Introduction to the company/ topic

5. Literature Review

6. Research Methodology

7. Data Analysis

8. Findings & Conclusion

9. Recommendations

10. References

11. Annexure

OBJECTIVES OF STUDY

To identify factors in business dynamics to grade employees on the

objectives & transparent productivity parameters.

To study about the system of self appraisal, appraisal by reporting officer, by

reviewing officer and final assessment by moderation committee.

To study about create a direct link between rewards & performance to

increase the motivation level of employees.

To study about assessment of training & developmental needs of individual

employees.

To study and make employees completely aware about the parameters used

for evaluation of their performance.

INTRODUCTIONTO

NTPC

INTRODUCTION TO NTPC

NTPC: India’s largest power company

Established on 7th November 1975 to play a major role in the development of Indian Power Sector: NTPC Limited is today India’s largest power company with an installed capacity of 31,704 MW Lighting up more than one fourth of India through its 15 coal based 7 gas based and 5 joint venture projects, NTPC Limited plans to become a 75,000 MW Company by the year 2017 with a vision to become a world class integrated power major with increasing global presence. NTPC Ranked No. 1 Independent Power Producer in Asia and 2nd in the world in the Platts Top 250 Global Energy Company list for 2009. Ranked number ONE in the category the 'Best Workplaces for Large Organizations' and number tenth overall for the year 2009 by Great Places to Work Institute’s India chapter in collaboration with Economic Times.

NTPC: At a Glance

Category No. of stations Capacity (MW)Coal based station 15 24,885Gas based station 7 3,955Joint venture 5 2,864Total 31,704

Details of power Stations(NTPC)

Project StateCapacity(MW)

a. Coal Based

Singrauli Uttar Pradesh 2000Korba Chhattisgarh 2100Ramagundam Andhra Pradesh 2600Farakka West Bengal 1600Vindhyachal Madhya Pradesh 3260Rihand Uttar Pradesh 2000Kahalgaon Bihar 2340Dadri Uttar Pradesh 1330Talchar Kaniha Orissa 3000Unchahar Uttar Pradesh 1050Talchar Thermal Orissa 460Tanda Uttar Pradesh 440Simhadri Andhra Pradesh 1000Badarpur Delhi 705Sipat-II Chhattisgarh 1000

Total 24885

b. Gas Based

Anta Rajsthan 413Auraiya Uttar Pradesh 652Kawas Gujrat 645Dadri Uttar Pradesh 817Jhanor Gujrat 648Rajeev Gandhi(Kayamkula) Kerela 350Faridabad Haryana 430

Total 3955

c. Joint Venture

Roukela Orissa 120Durgapur West Bengal 120Bhilai Chhattisgarh 574Ratnagiri Maharashtra 1940Kanti Bihar 110

Total 2864

Total Production(a+b+c) 31704

Subsidiary companies of NTPC

NTPC – Joint Ventures (15)

Electrifying performance

The company recorded a total generation of 218.84 Billion Units (Bus) showing an increase of 6% over the pervious year’s generation of 206.93 Bus with a share of 20% (Ines of JV company) in the total installed capacity of the country NTPC generated 28.6% electricity during 09-10. Exceeded the MoU ‘Excellent’ target of 217 BUs.

Vision

“A world class integrated power major, powering India’s Growth, with increasing global presence.”

Core Values

Business ethics Customer focus Organizational & Professional Pride Mutual Respect and Trust Initiative and speed Total Quality for Excellence

FINANCIAL FACTS >>>

100% realization of the billing for the seventh consecutive year.

Provisional and un-audited Net Sales of Rs. 46,504.47 crore during 2009-10 as against Rs. 41,791.30 crore registering an increase of 11.28%. The provisional and un-audited Gross Revenue is Rs.49,478.86 crore during 2009-10 as against Rs.45,272.76 crore for the year 2008-09, an increase of 9.29%.

Provisional and un-audited Profit after tax for the year 2009-10 is Rs.8,656.53 crore as compared to Rs.8,201.30 crore during the year 2008-09, an increase of 5.55%.

Highest interim dividend @ 30% amounting to Rs. 2,473.64 crore paid during the year.

Capital Expenditure of Rs. 10,137.18 crore during 2009-10; NTPC Group’s capital expenditure was Rs. 14,002.11 crore.

Approved outlay for 2010-11 for NTPC’s capital schemes is Rs.22,350 crore; for NTPC Group the outlay is around Rs.29,104.06 crore. Contributed Rs.3,260.21 crore to exchequer on account of Corporate tax, Dividend and tax thereon and wealth tax.

Shareholder Wealth

Third largest market capitalization of over Rs.1,70,000 crore as on 31-03-2010.

Growing Stature

Recommended for “Maharatna” status.

EXCELLENT rating under Government of India MoU for the year 2008-09.

Bulk Tendering

Tendering undertaken for 11 units of 660 MW (including 2 units for DVC).

Rural Electrification

Under Rajiv Gandhi Grameen Vidyutikaran Yojana, NTPC Electric Supply

Company Ltd (NESCL) completed electrification of 8017 villages and provided

8.65 Lakhs BPL connections, thereby exceeding GoI target of electrification of

7500 villages and 8.5 Lakhs BPL connections.

Commonwealth Games

Official Power Partner of Delhi 2010 Commonwealth Games.

Further Public Offer

Government shareholding in NTPC reduced from 89.5% to 84.5% through

divestment of Government stake by 5% under Further Public Offer (FPO).

Accolades

Top six out of eight National Awards for Meritorious Performance of

Thermal Power Stations for 2008-09 instituted by the Government of

India won by NTPC coal stations.

Simhadri 1000 MW Gold Shield

Korba 2100 MW Silver Shield

Ramagundam 2600 MW Silver Shield

Dadri (coal) 840 MW Bronze Shield

Rihand 2000 MW Bronze Shield

Vindhyachal 3260 MW Bronze Shield

No. 1 Independent Power Producer in Asia and 2nd globally in the Platts

Top 250 Global Energy Company Rankings 2009

THE GROWTH STORY >>>

Installed capacity reaches 31,704 MW (including 2864 MW under JVs).

All time highest single day generation of 684.55 MUs from all NTPC

stations on 31st March, 2010

17,830 MW under construction at 17 locations. .

Project (Fuel) , State Capacity

Sipat-I (Coal), Chhattisgarh 1980

Barh –I (Coal), Bihar 1980

Korba-III (Coal), Chhattisgarh 500

Dadri-II (Coal)-Unit # 2, U.P. 490

Farakka-III (Coal), West Bengal 500

Simhadri-II (Coal), Andhra Pradesh 1000

Indira Gandhi STPP - JV With HPGCL & IPGCL (Coal),

Haryana

1500

Vallur (Phase -I & Phase –II) (Coal) - JV With TNEB,

Tamil Nadu

1500

Nabinagar-JV With Railways (Coal), Bihar 1000

Bongaigaon (Coal), Assam 750

Mauda-I (Coal), Maharashtra 1000

Barh-II (Coal), Bihar 1320

Rihand-III (Coal), UP 1000

Vindhyachal-IV (Coal), MP 1000

Muzaffarpur-II (Coal), JV With BSEB, Bihar 390

Koldam (Hydro), H.P 800

Loharinag Pala ( Hydro ), Uttaranchal* 600

Tapovan Vishnugad ( Hydro ), Uttaranchal 520

Total 17,830 MW

Capacity Addition in 2009-2010 (1560 MW)

Project/ Unit Capacity (MW)

NTPC owned

Kahalgaon Stage-II 500

Dadri Stage-II, Unit # 5 490

Under JVs

RGPPL Block- I 640

Less on account of overall de-rating of RGPPL (-)180

Kanti Stage-I 110*

Net addition 1560

Planned Capacity Addition in 2010-2011 (4150 MW)

Project/ Unit Capacity (MW)

Sipat Stage-I, Unit-1 660

Jhajjar, Unit-1 & 2 1000

Korba Stage –III, Unit-7 500

NCTPP Stage – II, Unit-6 490

Simhadri, Stage-II, Unit-3 & 4 1000

Farakka, Stage-III, Unit-6 500

Total 4150

Future Capacity Under Different Stages

Projects for which bids invited 7092 MW

Projects for which FR approved 4345 MW

Projects for which FR prepared/under preparation ~15,000 MW

Growth in Commercial Capacity

1490 MW declared commercial (including 500 MW under JV).

New national benchmark: Dadri Unit-5 (490 MW) begins commercial

operation in 39 months from zero date.

Generation

Impressive Growth Rate

Generation increased by nearly 6% to 218.84 BUs compared to 3% generation

growth achieved in 2008-09; Exceeded the MoU ‘Excellent’ target of 217 BUs.

2005-06 2006-07 2007-08 2008-09 2009-10

170.880000000001

188.67200.86

206.93218.84

Generation (BUs)

Sustaining Market Leadership

Contributed 28.6% of total electricity generated in the country

Total electricity available in the country 771.17 BUs

Electricity import from Bhutan 5.34 BUs

Total Electricity Generation in the Country 765.83 BUs

Total Generation from NTPC Units 218.84 BUs

NTPC share in total electricity generation in the country 28.6%

World Class Capacity Utilization

With 90.81% Plant Load Factor (PLF) during 2009-10 (National PLF

77.48%), coal stations achieved PLF of more than 90% for third

consecutive year.

Six coal stations achieved PLF of more than 95%.

Dadri (Coal) Stage I (4X210 MW) achieved highest ever PLF of 100.59 %.

Sixteen units recorded more than 100% PLF.

Seven NTPC coal stations figure among the top 10 stations in the country

in terms of PLF.

Highest ever PLF of gas stations at 78.38% (previous year PLF 67.01%).

Augmenting Fuel Security

Model Coal Supply Agreement signed with Coal India Ltd (CIL) for supply

of coal to NTPC stations for 20 years.

Gas supplies increase to 13.88 MMSCMD (up 29% over previous year).

Long term contract for supply of RLNG of 2.0 MMSCMD on firm basis and

0.5 MMSCMD on fallback basis signed with GAIL for 10 years.

Under NELP VIII, NTPC has been allotted one block at Cambay basin as a

sole operator and three blocks as a member of consortiums.

Coal Mine Development

Working on captive coal mines with target of 47 MTPA by 2017 from the 6

blocks allotted.

More than 6735 acres of Land in Pakri Barwadih and about 1594 acres of land

in Chatti Bariatu coal block have been acquired and land acquisition for

Dulanga and Talaipalli are in progress.

Rehabilitation Action Plan (RAP) has been approved by NTPC Board for Pakri

Barwadih, Chatti Bariatu and Kerandari.

Mining Plan approved for Dulanga (7 MTPA) and Talaipalli (18 MTPA).

JV agreement has been signed with CIL for development, operation and

maintenance of Coal Blocks and Integrated Power Projects.

Coal Block Acquisition Abroad

Due diligence for acquisition of stakes in two coal mines in Indonesia is

under progress and consultant appointed for carrying out due diligence

for one coal block in Mozambique.

International Coal Ventures Ltd (ICVL) has been incorporated on

20.05.2009 as a JV company of NTPC, RINL, SAIL, NMDC and CIL for

sourcing coking and thermal coal from overseas countries like Australia,

Mozambique, Canada, Indonesia and USA. ICVL is pursuing 3 thermal coal

opportunities in Indonesia, Australia and South Africa.

Getting into Nuclear

JV agreement is expected to be signed shortly with Nuclear Power Corporation

of India Limited (NPCIL). Approval has been obtained from Department of

Atomic Energy (DAE).

Focus on Renewables

By 2017, NTPC plans to have at least 1000 MW through renewable energy

resources such as wind, hydro, solar, biomass and geo-thermal.

Long Term Corporate Plan upto 2032

Finalizing the Long Term Corporate Plan of NTPC to set the goals and directions

for a period of 2032 with a view to positioning NTPC as the world’s largest and

best power producer.

Technology Roadmap upto 2032

Chalking out a long term technology roadmap upto 2032 which involves

development, adoption and promotion of safe, efficient and clean technologies

for entire value chain of power generation business.

ENVIRONMENT MANAGEMENT

NTPC has adopted advanced and high efficiency technologies such as

super critical boilers for the up-coming greenfield projects (e.g Barh,

Sipat etc). Out of total coal based capacities to be developed during 12th

plan period, over 90% will be based on supercritical technologies.

In addition to adopting advanced and high efficiency technologies, NTPC

has been pursuing the objective of sustainable power development with

following initiatives:

CO2 measurement systems are being installed at all our stations in

the chimney stacks.

61 Ambient Air Quality Monitoring System (AAQMS) installed in all

NTPC stations.

Installed Bio–methanation Plant at Faridabad.

Creation of green wealth of more than 18.80 million trees.

ASH UTILISATION

Achieved ash utilization of 59.73% i.e. 27.61 million tons of ash.

10.85 million tons fly ash issued to cement and concrete industry which is

8.5 % more than last year.

545 million ash bricks have been manufactured in Pilot ash brick

manufacturing plants.

1.13 million tons of ash from Talcher-Thermal has been utilized for filling

of abandoned South Balanda coal mine of MCL in Orissa.

MoU has been signed with Research Designs & Standards Organization

(RDSO), Lucknow to explore use of ash in Railway embankment.

HUMAN RESOURCE MANAGEMENT

HR Vision:

To enable our people to be a family of committed world

class professionals, making NTPC a learning organization.

The HR Dept. has a long history in NTPC. This dept. was earlier known as

personnel dept. then finally HRS(Human Resource Services)

HRS contributes its expertise in handling and executing the

Existing and Developing HR trends and innovations. Following are the areas of

operation. :-

Employee Welfare

Employee Benefits

Employee Relations (Industrial Relations)

Employee Services (Office Admin.)And Pensions

Employee Services (Town Admin.)

Training and Development (EDC)

Performance Management System and Human Resource Development

Corporate Social Responsibility

Rajbhasha (Hindi)

Law

Peoplesoft – HRMS (ERP Software)

Public Relations

The HR strategy of NTPC has been designed around the four building

blocks of competence building, commitment building, culture building and

system building. Culture building is done by creating transparency,

openness and ease of communication, strengthening mutual respect and

trust, leading to establishment of a people oriented and people sensitive

organization. This has resulted in recognition of NTPC as one of the best

employers in the country as well as obtaining consistently high rankings

in surveys such as “Great place to work” and “Best companies to work for”.

Employee Development Centers (EDC) have been set up to cater to the

need of appropriate Training and Development of employees.

Leadership Assessment and Development System (LEADS): With a view to

developing a pipeline of leaders for key leadership positions in the

company, an initiative named LEADS has been launched. A Leadership

Development Centre (LDC) at corporate centre has been set up to

formulate the process of identifying and grooming potential leaders.

High Productivity of Team-NTPC: During 2009-10, sales per employee

increased from Rs. 1.77 crore to Rs.1.96 crore, profit per employee

increased from Rs. 34.7 lakh to Rs. 36.45 lakh, value added per employee

increased from Rs. 59.36 lakh to Rs. 72.96 lakh and the man:MW ratio

improved from 0.85 to 0.82.

Total employee strength is 24,955 as on 31.03.2010, as against 24,713 on

31.03.2009 (including employees in JVs & Subsidiaries).

LITRATURE REVIEWWhat Performance Management Is Not?

it’s not just an annual performance appraisal

it’s not imposing targets/goals on an employee by his supervisor

it’s not only evaluating individual job performance

What is Performance Management:

it’s Management By Objectives (MBO)

it’s about setting SMARTER goals

it’s about planning to perform

it’s about periodically reviewing progress in performance

it’s about evaluating performance for further improvement

it’s about delivering reinforcement for performance success and

performance failure

BENEFITS OF PERFORMANCE APPRAISAL

EMPLOYER’S PERSPECTIVE

1. Despite imperfect measurement techniques, individual differences in

performance can make a difference to the company’s performance.

2. Documentation of performance appraisal and feedback may be needed for legal

defense.

3. Performance appraisal dimensions and standards can help to implement strategic

goals and clarify performance expectations.

4. It provides a rational basis for constructing a bonus or merit system.

5. Providing feedback is a part of the performance management process.

6. Despite traditional focus on the individual, appraisal criteria can include

teamwork and teams can be the focus of teamwork.

EMPLOYEE’S PERSPECTIVE

1. Performance feedback is needed and desired by the individual employee to

improve his/her performance.

2. Fairness requires that differences in performance levels across workers be

measured and have an effect on the outcomes.

3. Assessment and recognition of performance levels can motivate workers to

improve their performance.

PROBLEMS AFFECTING THE VALIDITY OF

PERFORMANCE APPRAISAL SYSTEM

1. HALO EFFECT

This type of error occurs when the rater allows one aspect of a man’s character or

performance to influence his entire evaluation.

2. CENTRAL TENDENCY

This error occurs when the rater is in doubt about the subordinates or has

inadequate information about them or is giving less attention and effort to the

rating process.

3. LENIENCY ERROR

Some supervisors have a tendency to be easy raters. Lenient raters consistently

assign high values to their subordinates. This type of error results in wrong

evaluation of the performance of subordinate.

4. STRICTNESS ERROR

Some other types of supervisors have a tendency to be harsh in their ratings. They

continuously give low ratings to their subordinates.

5. RECENCY EFFECT

Often some raters evaluate persons on the basis of their performance in recent few

weeks, average constant behaviour is not checked.

Performance Management

SystemAt

NTPC

Mid – year Review

Annual Assessment

Performance planning

Feedback

Normalisation Process

Step 1

Step 5

Step 4

Step 3

Step 2

PMS Process

PMS AT NTPC

PMS is a five step process:-

1. Performance Planning

Performance Planning is the process of: Defining expectations i.e. the work to be done, the results/targets to be

achieved and skills/competencies needed to achieve these objectives Setting “Measures” and “Targets”, determining priorities and weightages

of results to be achieved Identifying and allocating appropriate resources (such as manpower, tools,

training, budget etc.) to enable the executive to achieve the targets While defining work objectives and measures, it is necessary to ensure that:

Goals/ Targets/ Objectives are SMART (Specific, Measurable, Agreed, Realistic and Time bound)

Results are substantially within the executive’s control Measures relate to results Data is available for measurement Agreement on mutually agreeable and achievable performance targets is

arrived at after sufficient discussion between reporting officer and executive has take

2. Mid Year Review

Performance management is not an event but an ongoing process. Mid year reviews help in the following ways:

Reinforcing good performance in time Updating the status of targets i.e. progress review Identifying areas for “mid-course” correction

(37) Revisiting KPAs and goals, if necessary Assessing resource and skill requirements affecting the individual’s

performance Discussion and feedback on functional competencies, managerial

competencies, potential competencies and core values actualization Providing early warnings of non-performance, i.e. avoiding year end

surprises

3. Annual Assessment

The objectives of Annual Assessment are to: Discuss and arrive at an assessment of performance with respect to agreed

targets Assess the competencies, potential and core values actualization by the

individual Agree upon improvement plans and development needs for the individual

. 4 Normalization

The objectives of the Normalization System in PMS are to:Ensure parity and integrity by minimizing variation in rating by different reporting officers across various departments and locations Enhance objectivity and transparency in the appraisal system To view individual performance from the perspective of organizational achievement.

5 Feedback, Coaching and Counselling

In order to make PMS an open system and to enhance development orientation across the organization; feedback, coaching and counselling are essential components. Communicating the final performance results of the executive and providing developmental feedback are critical to this process.

5.1 Feedback

Providing feedback on performance presents the following benefits: Creates transparency making PMS more acceptable to individuals Reinforces good performance on time Enables development of coaching and mentoring relationship between

reporting officer and executive Ensures that organizational objectives are achieved to an acceptable standard

and in an acceptable form Providing performance feedback is a delicate matter and the reporting officer should create suitable conditions for providing performance feedback in the most effective manner. (Refer to appendix for tips to reporting officers on conducting effective appraisal meetings.) In general:

Feedback should be focused on the specific performance actions and not on the personality of the executive

Feedback should be generated after reviewing all achievements and issuesthroughout the assessment period and not focused on isolated incidents

Feedback calls for maintaining a log of critical incidents occurring during the assessment period for recording both achievements and failures with details, as an aid to memory during performance discussions with the executive

Feedback be given as regularly as possible so that enough opportunities are created for executive to bridge performance gaps through self-development

5.2 Coaching and CounsellingCoaching is an on-the-job approach to help individuals to develop and raise their skills and levels of competence. Coaching typically consists of:

Making executives aware of how well they are performing and their present level of knowledge and skill

Providing guidance to individuals to enable them to complete their worksatisfactorily

Motivating individuals to learn new skills and develop themselves(39)

Facilitating individuals to raise their level of contribution and achievement.Counselling in the PMS context essentially is a process by which executives can receive assistance in sorting out issues and related to current and future responsibilities and aspirations. Therefore, reporting officers are required to encourage individuals to plan for their own self-development. The process of counselling is through:

Recognition and understanding of existing strengths Empowering, i.e. enabling the individual to recognize their own problems

and expressing the same. Facilitating action through guidance and expertise, i.e. facilitating the

process whereby the individual evaluates alternatives and formulates action plans to achieve the most suitable course of action

Helping individuals to take ownership of the outcomes of their chosen action.

Coaching and counselling together act as a feedback mechanism for the individual on his/her performance. It is often used by reviewer/reporting officer to communicate the areas for development and improvement to the executive.

KPA Setting Process:

PMS COMPRISES ASSESSMENT ON FOUR PARAMETERS WITH DIFFERENT WEIGHTAGES FOR VARIOUS LEVELS

S.NO. PMS PARAMETER WEIGHTAGES FOR DIFFERENT GRADES

E1-E3 E4 E5 E6-E7 E7A-E8 E91 KPA 80 75 65 60 50 50

2 a. Functional competency assessment

10 10 10 10 10 05

b. Managerial competency assessment

05 05 10 10 15 15

3 Potential assessment

Nil 05 10 10 10 10

4 Value assessment 05 05 05 10 15 20

Total 100 100 100 100 100 100

Company Goals

Unit Goals

Individual Goals

Functional /Departmental Goals

MOUs

Special task

Initiatives

Corporate plan

For junior executives there is higher weightage on KPAs and functional competencies as there is higher focus on achieving the immediate functional task.

The weightage on Managerial competencies and values increases for an executive as the grade increases because of importance of achieving business goals by managing work of other employees through ethical means.

At NTPC Online Performance Management System is being practiced for Executives. For Non Executives it is still manual.

Thre are three major challenges in effective implementation of PMS at NTPC

1. Involvement of big number of executives (approx 1200) in designing of KPAs and Competency Directory.

2. Skill gap in feedback and performance counseling.3. Transformation from legacy to transparent system.

VARIOUS KINDS OF PERFORMANCE APPRAISAL SYSTEMS

Personality based performance appraisal system:

Here the appraiser is supposed to rate the personality traits of the person being appraised. This is not in much in organisations as it very subjective and judgmental. It

could also be biased and prejudiced.

Competence based performance appraisal system:

Here the job analysis is used and the employee is appraised for the skills he exhibits. For e.g. if his job entails dealing with the clients then he is judged foe his effectiveness in dealing with them. This enables both the organisation and the employee as to what deficiencies are to be overcome and can be useful in providing training to the employee to better his performance.

Result based performance appraisal system:

This system concentrates on the final results achieved by the employee irrespective of his personality or deficiencies. This is totally related to the job and concentrates on the end results that are more important to the organization.

Thus Performance Appraisal is the process to establish the competency and the learning gap in addition to reward system. Performance increment would depend on the performance appraisal input for the department and the management for decision making. Human Resources would craft the notice and letter to communicate to the employees. This is also an important issue. Human Resources is the corporate communicator and is responsible for employees communication

(56)

Roles and Responsibilities

1 Role of Executive:

The executive shall fill out appropriate portions of the form, attend the PMS meetings at all stages (performance planning, mid-year review and annual assessment) and be prepared to have an open and frank discussion about his/her performance.

The PMS aims at creating amity and convergence of individual and organizational goals and it should be taken in that spirit.

The executive is required to show the necessary flexibility and adaptability to the organisational needs and display system discipline through adherence to all PMS requirements.

2 Role of Reporting Officer

The reporting officer shall cascade the KPAs based on MoU targets to theexecutives reporting to him in a fair and achievable manner with necessary stretch for individual excellence.

The reporting officer should set up performance planning, mid-year review and annual assessment meetings with all the executives reporting to him within the specified periods as per the PMS calendar.

The reporting officer shall maintain a brief log of all critical incidents occurring within his scope of work as an aid to memory while completing the mid year review, annual assessment and giving feedback to the executive.

The reporting officer shall carry out the PMS scoring of all executives reporting to him in an objective manner and such that the scores are distributed in a manner requiring minimum adjustment and/or normalisation by either the reviewing officer or the Performance Management Committee.

In the event of change of KPAs, measures, targets etc., the reporting officer is required to obtain clearance from Reviewing Officer prior to making the change.

(57)

3 Role of Reviewing Officer

The reviewing officer shall go through PMS forms for all executives under his purview and ensure that the reporting officer has been objective and

unbiased in his scoring of various executives, particularly with respect to the sections relating to Competencies, Values and Potential

Where required, the reviewing officer may recommend some changes to the scores after carrying out a detailed discussion with the respective reporting officer

The reviewing officer shall also carry out an integrity check to ensure that the scores awarded to all the executives under his/her purview are distributed in a manner requiring minimum normalisation by the Performance Management Committee.

Where an executive has a grievance against the reporting officer regarding the PMS process, the reviewing officer shall intervene and settle the grievance in a fair and objective manner.

The reviewing officer shall also be responsible for ensuring “stretch targets” for executives under his charge.

The Reviewing Officer shall cascade the KPAs in an open and transparent manner with each reporting officer by sharing his KPAs and targets.

4 Role of PMS Officer

A PMS Officer would be designated for each location (plant/ project/ region/ corporate)

The PMS Officer would be responsible for implementing PMS as well as forperiodic administration, follow-up, tracking and analysis of PMS activities as per schedule in his/her respective location.

To ensure collection, collation and forwarding the Individual Development Needs forms to the concerned EDC/ Regional HRD/ PMI.

RESEARCHRESEARCHMETHODOLOGYMETHODOLOGY

OBJECTIVES OF STUDY

To identify factors in business dynamics to grade employees on the

objectives & transparent productivity parameters.

To study about the system of self appraisal, appraisal by reporting officer, by

reviewing officer and final assessment by moderation committee.

To study about create a direct link between rewards & performance to

increase the motivation level of employees.

To study about assessment of training & developmental needs of individual

employees.

To study and make employees completely aware about the parameters used

for evaluation of their performance.

RESEARCH DESIGN

Research design was adopted for the “Exploratory Research Study”. The main

purpose of the study was to formulate the problem in appraisal system for

investigation. The major emphasis was on the discovery of ideas & opinions of the

employees at different levels to improve the existing appraisal system. Two

methods were used for the study-:

1. The survey of concerning literature.

2. The experience survey

SAMPLING DESIGN

The sampling design used for the study was “Stratified Sampling”. The different

strata or homogeneous group formed was-:

Executives

SAMPLING UNIT

The sampling unit was “National Thermal Power Station”, Lodhi road, New Delhi.

SAMPLE SIZE

In total 42 employees(executives) were interviewed during the study.

DATA COLLECTION METHODS

In the survey two types of data were collected-:

1. PRIMARY DATA

Primary data are those which are collected for the first time and therefore original

in nature.

2. SECONDARY DATA

Secondary data are those which have already been collected by someone else and

hence passed through the statistical process.

For the collection of primary data methods used-:

QUESTIONNAIRE METHOD

I prepared a structured questionnaire on the basis of information collected from different sources. The questionnaire contains both open & closed ended questions.

2. SECONDARY DATA COLLECTIONSecondary data were collected from the following sources-:

(A) Books related to the topic

(B) Company documents

(C) Magazines

(D) Websites

STATISTICAL TOOLS USED

Statistical tools used in the project study are-:

1. TABLES

2. PIE CHARTS

Data Analysis

Of

Feedback Given

By

Executives

Quest:-1 your job description clearly define KPA’s on which your performance is rated.

OPINIONNO. OF RESPONDENTS PERCENTAGE

STRONGLY AGREE 12 28

AGREE 27 64CAN'T SAY 0 0DISAGREE 3 7STONGLY DISAGREE 0 0

Inference:- They were well aware about there KPAs and felt that it is according to there job profile as 92% Executives agreed to it.

Quest: 2 -The goals (KPA’s) set are always mutually agreed upon i.e. your consent is taken into consideration while setting KPA’s.


STRONGLY AGREE 8 19

NO. OF RESPONDENTS

STRONGLY AGREEAGREECAN'T SAYDISAGREESTONGLY DISAGREE


Inference: - The response was divided although 76 % Executives agreed about their consent being taken into the KPA setting process, 5% disagreed. It says that in general executives participate in the KPA setting process but there is some dissatisfaction.

Quest: 3 Do you feel that the mutually agreed upon targets /timelines are soft and can be stretched further for improved performance.


STRONGLY AGREE 5 12AGREE 18 43CAN'T SAY 7 17

NO. OF RESPONDENTS


DISAGREE 12 28STONGLY DISAGREE 0 0

Inference: - 28% of respondents disagreed about the softness of their timelines and 17% don’t want to answer. There is a sort of dissatisfaction regarding Timelines or targets that are unable to improve the performance of executives.

Quest: 4- You are satisfied with the weightages given against each activity that you are supposed to perform in the specified period.


STRONGLY AGREE 8 19

NO. OF RESPONDENTS



Inference:-Mostly, they agreed about the adequacy of weightages given against each activity which they are supposed to perform in a given period.

Quest: 5- The deadlines set to complete and submit the performance documents are sufficient.



NO. OF RESPONDENTS



Inference:- Mostly they are satisfied with the operations of Performance Management system.

Quest: 6 - The KPA’s are in accordance with the MOU targets of the company and the targets of the plant.



NO. OF RESPONDENTS



Inference:- It simply shows the awareness level of Executives. 66% of them were agree and felt that individual goals matches well with unit goals and company goals.

Quest: 7- All the factors facilitating and hindering performance are taken into consideration while appraising the performance.


STRONGLY AGREE 10 24AGREE 17 40

NO. OF RESPONDENTS


CAN'T SAY 13 31DISAGREE 2 5STONGLY DISAGREE 0 0

8

Inference:- A healthy proportion of them agreed to this. Generally most of the factors affecting the performance of an employee are taken into considereation.

Quest: 8- Your seniors assist you at the time of your need.



NO. OF RESPONDENTS



Inference:- The response says that that there is a healthy environment of working, seniors assist their subordinates whenever there is any need.

Quest: 9- Your final rating is doesn’t only on your competencies and KPA’s but also on several other factors are like your interpersonal relation with the rater.


STRONGLY AGREE 7 17

NO. OF RESPONDENTS



Inference:- Along with the competencies and KPA achievements the factors like communication skills of the executives matter while rating their performance.

Quest: 10- Your doubts and queries are addressed by the PMS administrator while operating online PMS.



NO. OF RESPONDENTS



10

Inference:- Except a few disagreement most of the employees agree that their doubts and queries are addressed by the PMS administrator.

Quest: 11- The process is used mainly for improving the future performance



NO. OF RESPONDENTS



Inference:-Performance management is meant for improving future performance of employees and most of them agreed to it. The rewards and recognitions are part of performance upgradation.

Quest: 12- You feel free to express to your appraiser your disagreement regarding the appraisal decision.



NO. OF RESPONDENTS



Inference:-It seems that upto some extent the employees are hesitant to express their disagreement regarding the appraisal decision to their appraiser, but overall the system is open and flexible as 52% of them agreed to it and almost the same no were neutral.

Quest: 13- Your seniors provides you with continuous feedback to help you achieve your KPA’s.



NO. OF RESPONDENTS



Inference:-Mostly Executives are well aware about their KPAs and seniors keep providing them feedback to achieve that, although some of them disagreed to it which may be due to miscommunication between senior and subordinates.

Quest: 14 - The recognition given to high performance is appropriate and helps in motivating the employee.



NO. OF RESPONDENTS



Inference:-The recognition given to High performers is appropriate. There are scopes of evolution of the recognition system so that even those who disagreed to the appropriateness of the recognition system get satisfied.

Quest: 15-Does the PMS effectively captures the training needs of executives.


STRONGLY AGREE 5 12

NO. OF RESPONDENTS



Quest: 16- Appropriate training is given to employees who fail to meet the expected performance level.

OPINION NO. OF PERCENTAGE

NO. OF RESPONDENTS


RESPONDENTSSTRONGLY AGREE 3 7AGREE 5 12CAN'T SAY 18 43DISAGREE 14 33STONGLY DISAGREE 1 2

Inference:-Although half of the executives surveyed preferred to not to say anything, There is a need to improve the training system so that appropriate training could be given to those who need it.

Quest: 17- The online PMS is dynamic and keeps you aware about your instantaneous weak and strong area of performance effectively.

NO. OF RESPONDENTS



STRONGLY AGREE 6 14AGREE 14 33CAN'T SAY 9 21DISAGREE 10 24STONGLY DISAGREE 2 5

Inference:-The online PMS may be dynamic as compared to the manual system but it does not provide instantaneous feedback about one’s KPAs.

Quest: 18- Managers and Employees trust the appraisal process.


NO. OF RESPONDENTS


STRONGLY AGREE 6 14AGREE 18 43CAN'T SAY 11 26DISAGREE 6 14STONGLY DISAGREE 1 2

Inference:-The appraisal process is trustworthy.

FINDINGS AND ANALYSIS

NO. OF RESPONDENTS


On the basis of the survey conducted, following points has emerged out which

require the attention of the management-:

1. The present performance appraisal system below E7 level is not effective

enough to serve the purpose of employee’s appraisal.

2. Below E6 level the “Management by Objectives” approach is not followed and

hence the employees are not clear about their functions based on these objectives.

3. Proper weightages are not assigned to different attributes which differ in their

importance.

4. Many employees are not aware about the criterion used for their appraisal.

5. According to those who know about the criterion, it is not sufficient to judge

their performance.

6. There is a wide gap between the self assessment by the employee and the formal

appraisal done by the organization.

7. There is no provision of incentives to the individual employee based on his/her

performance appraisal rating.

8. Formal feedback is not provided to the employees on regular basis.

9. The appraisal system does not help the employees to discover their true potential

for higher responsibilities.

10. Employees do not get sufficient opportunity to appeal to the higher authorities

in case of adverse entry.

11. There is considerable amount of communication gap between the superiors &

subordinates.

12. No emphasis is given on the behavioral aspect of the employees which affect

their performance considerably.

13. Training is not provided to the employees on the basis of his/ her performance

appraisal rating.

CONLUSION AND RECOMMENDATIONSCONLUSION AND RECOMMENDATIONS

RECOMMENDATIONSRECOMMENDATIONS

1. “Management by objective” approach should be introduced below E6 level and

upto E1 level, so that executives at lower levels should also be aware about their

functions based on these objectives.

2. Before setting the KRA’s, the employees should prepare themselves by

reviewing their work beforehand, identifying barriers they faced in doing their jobs

and refamiliarise themselves with their job descriptions, job responsibilities etc.

3. Appraise should be allowed to present their own opinions and perceptions freely

but in a calm and factual manner.

4. Performance appraisal should not be concentrated to forms only but on its

purpose of performance improvement by removing barriers to job success.

5. Both appraiser & appraise should combinedly set realistic targets that can be

achievable, otherwise the procedure of setting KRA’s is wastage of time.

6. Weightages should be assigned to different attributes according to their

importance.

7. Formal feedback should be provided on regular basis to the employees, so that

problems can be prevented in their early stages. It’s a two way communication

process, therefore a subordinate can also initiate the process.

8. Reporting officer should make the employees aware about the criterion used for

their performance appraisal.

9. Monetary & non monetary incentives should be given to the individual

employee on the spot, by the manager, based on their performance. It will motivate

the employee.

10. Behavioral aspect of the employee should be given due importance while

reviewing his performance.

11. Training should be provided to the employee on the basis of his/ her

performance appraisal rating. It will help him/her to get new skills.

12. The procedure of performance appraisal should be transparent in the sense that

the employee should be aware about his/her appraisal rating.

13. Communication gap between the appraiser & appraise should be reduced by

means of performance appraisal & regular meetings.

14. Make employees more accountable towards their duties and responsibilities.

15. After the level of manager, there should not be fixed time limit for promotion

and employees get higher responsibilities on the basis of their potential and

aptitude. So, there should be potential appraisal along with performance appraisal

at this level and above.

16. A computerized system should be introduced to fill the forms and submission

at supervisor level and above. It will reduce the time required to do appraisal and at

the same time bring transparency between the appraisers and appraise, as he/she

can see his/her ratings on the computer whenever they want. A password should

also be assigned to the employee to keep his/her ratings confidential.

CONLUSIONCONLUSION

The aim of performance management system is ensuring the maximization of efforts by the employees of the organization to realize the desired goals. More effective the performance management of an organization more productive the organization would be. NTPC as a whole is a big organization with vast number of employees working there, to manage the performance of such a great number of people efficiently is a herculean task. The survey and personal interviews conducted during the project work says that an effective performance management system is on place but as we know everything in this world keep evolving itself for betterment, the performance management system is not an exception.

NTPC can touch new heights in the field of energy management by managing its manpower more efficiently, addressing there training needs, recognizing the high performances and making them feel the freedom of expressing their points.

Limitations of the Research

The subject was too big but time available was too less. The survey was not conducted among all the employees of NTPC but on a sample of randomly selected executives.

At times it was often felt that there is a difference between the real feeling and the feedback given by executives. Exact feedback must be given so that the analysis done would be correct.

Some of the executives were not interested in the subject metter.

We were unable to discuss issues related to our project with some people and only responses to questionnaire were collected.

REFERENCES

Human Resource and Personal Management - K. Ashwathapa

Organizational Behavior - Stephen p. Robins

http/intranet 1 – KHSTPP

http://www.ntpc.co.in/index.php?option=com_content&view=article&id=28&Itemid=41&lang=en

www.citehr.com

www.ntpc.co.in

http://www.ntpc.co.in/

http://www.citehr.com/



ANNEXURE

SURVEY ON PERFORMANCE APPRAISAL SYSTEM

This survey will only be used as an instrument for my summer training report for MBA.

PERSONAL INFORMATIONGRADE: ………………

DEPARTMENT: …………………………. SECTION: ………………………………

NUMBER OF YEARS OF SERVICE IN NTPC: ………….

S.NO QUESTIONS STRONGLY AGREE

AGREE

CAN’T SAY

DISAGREE

STRONGLY DISAGREE

1 Your job description clearly defines KPA’s (Key performing areas) on which your performance is rated.

2 Do you feel that goals (KPA’s) set are always mutually agreed upon i.e. – your consent is taken into consideration while setting KPA’s.

3 Do you feel that the mutually agreed upon targets /timelines are soft and can be stretched further for improved performance.

4 Are you satisfied with the weightage given against each activity that you are supposed to perform in the specified period

5 The deadlines set to complete and submit the performance documents are sufficient.

6 Your KPA,s are in accordance with the MOU targets of the company and the targets of the unit.

7 All the factors facilitating and hindering performance are


AGREE

CAN’T SAY

DISAGREE

STRONGLY DISAGREE

taken into consideration while appraising the performance

8 Your seniors assist you at the time of your need.

9 Your final rating is based not only on your competencies and KPA’s but also on several other factors like interpersonal relation with the rater.

10 Your doubts/Queries are addressed by the PMS administrator while operating online PMS.

11 The process is used mainly for improving the present performance.

12 Do You feel free to express to your appraiser your disagreement regarding the appraisal decision

13 Your senior manager provides you with continuous feedback to help you achieve your KPA’s.

14 The recognition given to high performance is appropriate and helps in motivating the employees

15 Does the pms effectively capture training needs of executives.

16 Appropriate training is given to employees who fail to meet the expected


AGREE

CAN’T SAY

DISAGREE

STRONGLY DISAGREE

performance level.

17 Do you feel the online PMS is dynamic and keeps you aware about your instantaneous weak or strong area of performance effectively

18 Do you feel Managers and Employees trust the appraisal process

YOUR SUGGESTIONS TO IMPROVE THE EXISTING PERFORMANCE APPRAISAL SYSTEM: ……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………… THANK YOU,

NIDHI (STUDENT-MBA, NIEC, NEW DELHI)