A STUDY ON THE EFFECTIVENESS

OF THE PERFORMANCE APPRAISAL SYSTEM

Introduction to Performance Appraisal

‘Performance appraisal is a formal, structured system of measuring and evaluating an employees

job, related behaviors and outcomes to discover how and why the employee is presently

performing on the job and how the employee can perform more effectively in the future so that

the employee, organization, and society all benefit’.

Performance appraisal is a process of summarizing, assessing and developing the work

performance of an employee. In order to be effective and constructive, the performance manager

should make every effort to obtain as much objective information about the employee's

performance as possible.

Performance Appraisal is a review and discussion of an employee's performance of assigned

duties and responsibilities based on results obtained by the employee in their job, not on the

employee's personality characteristics. Personality should be considered only when it relates to

performance of assigned duties and responsibilities.

It is a structured formal interaction between a subordinate and supervisor, that usually takes the

form of a periodic interview (annual or semi-annual), in which the work performance of the

subordinate is examined and discussed, with a view to identifying weaknesses and strengths as

well as opportunities for improvement and skills development.

In many organizations - but not all - appraisal results are used, either directly or indirectly, to

help determine reward outcomes. That is, the appraisal results are used to identify the better

performing employees who should get the majority of available merit pay increases, bonuses,

and promotions.

CONCEPTUAL FRAMEWORK

Performance appraisals are a systematic way of evaluating the standard of an employee’s

performance.

Steps for developing a systematic performance appraisal

1. Identify key performance criteria

Development of key performance criteria should be based on a comprehensive job description

and undertaken in consultation with employees.

2. Develop appraisal measures

In order to obtain accurate and valid performance appraisals, appraisal measures should be

tailored to the specific job or “job family” (i.e., groups of similar jobs). An evaluation of factors

in the work environment which help or hinder performance is also recommended. This ensures

that realistic expectations are set for employee’s performance, and is also likely to increase the

perceived fairness and acceptability of performance appraisals.

3. Collect performance information from different sources

Traditionally, it has been the sole responsibility of managers / supervisors to assess performance.

However, other organisational members (e.g., clients, coworkers, subordinates) can be a valuable

source of information as they are likely to have exposure to different aspects of an employee’s

performance. Collecting information from multiple sources can increase the accuracy of

performance evaluation (i.e., reduce bias), and increase employee’s perceptions of fairness.

4. Conduct an appraisal interview

The two central purposes of the appraisal interview are to:

1. Reflect on past performances to identify major achievements, areas for further improvement,

and barriers / facilitators to effective performance.

2. Identify goals and strategies for future work practice.

The appraisal interview should be a constructive, two-way exchange between the supervisor and

employee, with preparation for the interview done by both parties beforehand.

5. Evaluate the appraisal process

The performance appraisal process should undergo regular review and improvement. For

example, focus groups or surveys could be conducted to gauge employee’s perceptions of the

appraisal process. A successful performance appraisal process should demonstrate a change in

both the ratings of employee’s performance and aspects of the work environment that impact

upon work performance.

Best Practice In Performance Appraisal

In essence, best practice in performance appraisals involves:

Integrating performance appraisal into a formal goal setting system

Basing appraisals on accurate and current job descriptions

Offering adequate support and assistance to employees to improve their performance

(e.g., professional development opportunities).

Ensuring that appraisers have adequate knowledge and direct experience of the

employee’s performance

Conducting appraisals on a regular basis.

Meaning and Definition of Performance Appraisal

Performance appraisal is a formal system that evaluates the quality of a employee’s performance.

An appraisal should not be viewed as an end in itself, but rather as an important process within a

broader performance management system that links:

Organizational objectives

Day-to-day performance

Professional development

Rewards and incentives

In simple terms, appraisal may be understood as the assessment of an individual’s 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, health, and the like. Assessment should not be confined to past

performance alone. Potentials of the employee for future performance must also be assessed.

A formal definition of performance appraisal is:

“It is 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 related behaviors and outcomes to discover how and why the employee is

presently performing on the job and how the employee can perform more effectively in the

future so that the employee, organization, and society all benefit.”

“Performance appraisal is the process of obtaining, analyzing and recognition information about

the relative worth of an employee.”

Performance appraisal is also known as performance management, performance evaluation and

performance review.

Traditional Performance Appraisal

The history of performance appraisal is quite brief. Its roots in the early 20th century can be

traced to Taylor's pioneering Time and Motion studies. But this is not very helpful, for the same

may be said about almost everything in the field of modern human resources management.

During the First World War, appraisals concept was adopted by US army which was in the form

of merit rating. It was man-to-man rating system for evaluation of military personnel. From the

army this concept entered the business field and was restricted to hourly-paid workers. During

1920s, relational wage structures for hourly- paid workers were adopted in industrial units and

each worker were used to be rated in comparison to other for determining wages rates. This

system was called merit rating.

The process was firmly linked to material outcomes. If an employee's performance was found to

be less than ideal, a cut in pay would follow. On the other hand, if their performance was better

than the supervisor expected, a pay rise was in order. Little consideration, if any, was given to

the developmental possibilities of appraisal. If was felt that a cut in pay, or a rise, should provide

the only required impetus for an employee to either improve or continue to perform well.

Sometimes this basic system succeeded in getting the results that were intended; but more often

than not, it failed.

For example, early motivational researchers were aware that different people with roughly equal

work abilities could be paid the same amount of money and yet have quite different levels of

motivation and performance.

These observations were confirmed in empirical studies. Pay rates were important, yes; but they

were not the only element that had an impact on employee performance. It was found that other

issues, such as morale and self-esteem, could also have a major influence.

As a result, the traditional emphasis on reward outcomes was progressively rejected. In the 1950s

in the United States, the potential usefulness of appraisal as tool for motivation and development

was gradually recognized. The general model of performance appraisal, as it is known today,

began from that time.

Modern Performance Appraisal

Performance appraisal may be defined as a structured formal interaction between a subordinate

and supervisor, that usually takes the form of a periodic interview (annual or semi-annual), in

which the work performance of the subordinate is examined and discussed, with a view to

identifying weaknesses and strengths as well as opportunities for improvement and skills

development.

In many organizations - but not all - appraisal results are used, either directly or indirectly, to

help determine reward outcomes. That is, the appraisal results are used to identify the better

performing employees who should get the majority of available merit pay increases, bonuses,

and promotion.

By the same token, appraisal results are used to identify the poorer performers who may require

some form of counseling, or in extreme cases, demotion, dismissal or decreases in pay.

(Organizations need to be aware of laws in their country that might restrict their capacity to

dismiss employees or decrease pay.)

Whether this is an appropriate use of performance appraisal - the assignment and justification of

rewards and penalties - is a very uncertain and contentious matter.

A Framework of Performance Appraisal

1. Develop clear job description.

2. Select an appropriate people with an appropriate selection process.

3. Provide effective orientation, education and training.

4. Provide ongoing coaching and feedback.

5. Conduct quarterly performance development discussion.

6. Design effective compensation system.

7. Provide promotion and career development opportunities.

Objective of Performance Appraisal

Salary Increase

Performance appraisal plays a role in making decision about salary increase. Normally salary

increase of an employee depends upon on how he is performing his job. There is continuous

evaluation of his performance either formally or informally. This may disclose how well an

employee is performing and how much he should be compensated by way of salary increases.

Promotion

Performance appraisal plays significant role where promotion is based on merit and seniority.

Performance appraisal discloses how an employee is working in his present job and what are his

strong and weak points. In the light of these, it can be decided whether he can be promoted to the

next higher position.

Training and Development

Performance appraisal tries to identify the strengths and weakness of an employee on his present

job. This information can be used for devising training and development programmes

appropriate for overcoming weaknesses of employees.

Feedback

Performance appraisal provides feedback to employees about their performance. A person works

better when he knows how he is working. This works in two ways, firstly, the person gets

feedback about his performance. Secondly, when the person gets feedback about his

performance, he can relate his work to the organizational objectives.

Pressure on Employees

Performance appraisal puts a sort of pressure on employees for better performance. If the

employees are conscious that they are being appraised in respect of certain factors and their

future largely depends on such appraisal.

Communication

1. To provide feedback to employees so that they come to know where they stand and can

improve their job performance.

2. To clearly establish goals i.e. what is expected of the employee in terms of performance

and future work assignments.

3. To provide coaching, counseling, career planning and motivation to employees.

4. To develop positive superior subordinate relations and thereby reduce grievance.

Career development objectives

1. To assess the strong and weak points in the working of the employees and finding

remedies for weak points through training.

2. To determine career potential.

3. To plan career goals.

Others

1) Identifying systemic factors that are barriers to, or facilitators of, effective performance.

2) To confirm the services of probationary employees upon their completing the

Probationary period satisfactorily.

3) To improve communication. Performance appraisal provides a format for dialogue

between the superior and the subordinate, and improves understanding of personal goals

and concerns. This can also have the effect of increasing the trust between the rater and

the ratee.

4) To determine whether HR programmes such as selection, training, and transfer

have been effective or not.

How to Conduct a Performance Appraisal Process

The following five-step approach to conducting a systematic performance appraisal is

recommended:

1. Identify key performance criteria

2. Develop appraisal measures

3. Collect performance information from different sources

4. Conduct an appraisal interview

5. Evaluate the appraisal process.

Step 1: Identify Key Performance Criteria

Perhaps one of the most challenging aspects of setting up a performance appraisal is deciding

what to assess. In essence, four key dimensions of performance should be considered in a

performance appraisal.

Key Dimensions of Performance

Competencies Knowledge, skills, and abilities relevant to performance

Behaviours Specific actions conducted and / or tasks performed

Results / outcomes Outputs, quantifiable results, measurable outcomes and

achievements, objectives attained

Organisational citizenship

behaviours

Actions that are over and above usual job responsibilities

To ensure that the performance criteria are relevant to work practice and acceptable to appraisers

and employees:

i) Base the performance criteria on an up-to-date job description

ii) Develop criteria in consultation with appraisers and employees.

i) Base the performance criteria on an up-to-date job description:

Clear and explicit links between performance appraisal and a job description will ensure the

relevance of the appraisal. If a detailed job description is not available or is out-of-date, it is

strongly recommended that an accurate job description be developed prior to conducting a

performance appraisal.

ii) Develop criteria in consultation with appraisers and employee:

Linking performance appraisals with job descriptions can help to focus the appraisal process on

the key competencies, behaviours and outcomes associated with a particular role or position. It

can also be useful to consult with employees to:

Ensure that key aspects of a role / position are represented in the job description, for example:

1. Conduct assessments

2. Plan interventions

3. Manage cases

4. Liaise with and refer to other providers

5. Keep up-to-date service records and case notes

6. Write reports

7. Develop a clear understanding of the relative importance of various competencies,

Behaviours and outcomes

8. Identify how these key competencies, behaviours and outcomes can be fairly and

accurately assessed.

Employees are more likely to accept and be satisfied with the appraisal system if they participate

in the development of appraisal criteria and measures, and in the process of conducting

appraisals.

There are three important considerations in the design of appraisal measures:

1. Generic versus individually tailored measures

2. Objective versus subjective assessments

3. Assessing the impact of the work environment on performance.

1. Generic versus individually tailored measures

Many workplaces use a generic rating form for all employees irrespective of their role or

position within the organisation. Although this approach can save time and minimise cost, the

accuracy and relevance of appraisals may be significantly diminished. The “one size fits all”

approach of generic measures may overlook important performance criteria that are relevant to

particular jobs, and may also include criteria that are irrelevant to others.

Where time and other resources permit, it is more appropriate to construct appraisal formats

tailored to specific jobs or “families” of jobs. If the development of job-specific (i.e.,

individually tailored) appraisal formats is beyond the resource capacity of the organisation, an

alternative would be to develop two groups of criteria:

Core competencies that have applicability to the performance appraisal of all employees

within the organisation.

Additional competencies applicable only to some jobs and included in the performance

appraisal if relevant.

2. Objective versus subjective assessments

A basic distinction between different types of appraisal measures concerns the use of objective or

subjective criteria.

Objective assessments of work performance: Objective measures of job

performance involve counts of various work-related behaviours. Some common

objective job performance measures include

1. Absenteeism (number of days absent)

2. Accidents (number of accidents)

3. Incidents at work (number of incidents / assaults / altercations)

4. Lateness (days late)

5. Meeting deadlines.

Objective measures can be relatively quick and easy to obtain (given good organisational record-

keeping). However, it can be unwise to place too much emphasis on these types of objective

measures. An exclusive focus on results / outcomes may mask factors that impact on employee’s

performance that are beyond their control (e.g., client workload).

3. Subjective assessments of work performance

Subjective measures rely on the judgment of an appraiser (self, coworkers, or supervisor).

Subjective assessments are commonly used in performance appraisals and often involve

the use of rating scales. Subjective assessments are more likely to provide accurate

performance appraisals when:

The behaviours and outcomes being assessed are stated in clear behavioural terms

The employee understands the measures (e.g., rating scales) being used to evaluate

their performance, and agree that the measures are fair and accurate (i.e., measures

what it is supposed to)

Measurement is as brief as possible whilst addressing essential behaviours and

outcomes (frustration with long and unwieldy questionnaires may introduce error in

responses).

ii) Assessing the impact of the work environment on performance

The goal of a performance appraisal is to support and improve employee’s

performance and effectiveness. Therefore, it makes sense for an appraisal to include an

assessment of factors in the work environment that help or hinder a employee’s capacity

to perform effectively. Explicit assessment of environmental factors is also likely to

increase the perceived fairness and acceptability of performance appraisals.

For example, an employee’s capacity to provide effective treatment interventions is

influenced by factors such as:

Access to private, soundproofed, adequately sized rooms for counselling

Availability of validated, user-friendly assessment tools

Availability of reliable and approachable management / administration.

iii) Collect Performance Information from Different Sources

Once the appraisal measures are developed, the next step involves collection of accurate

performance information. A common trap is to begin noting observations of employees

just before conducting appraisals. This is likely to give an inaccurate picture of a

employee’s performance. Ideally, employee’s performance should be observed in a

systematic way over time (e.g., in a diary). This method ensures the accuracy of

information about their performances.

Many employees in the organisation operate with a relatively high degree of autonomy.

This combined with the heavy workload of most managers / supervisors, may limit

opportunities to conduct regular observation of employee’s performance. In addition,

perceptions of ongoing monitoring may foster a sense of surveillance which can damage

staff morale. A more suitable approach may be to keep critical incident reports that note

specific examples of both excellent and unsatisfactory performances. Supervisors can

also encourage employees to keep track of their own performance records such as emails

or letters that commend them on their achievements.

Traditionally, it has been the sole responsibility of managers / supervisors to assess

performance. However, other organisational members can be a valuable source of

information as they are likely to have exposure to different aspects of a employee’s

performance. This approach is known as 360-degree feedback. For instance, coworkers

can provide valuable information on teamwork skills, and subordinates can provide

useful information on leadership style.

There are many advantages to obtaining feedback on performance from sources other

than supervisors or managers.

Five different sources of performance appraisal information are considered here:

Manager / supervisor appraisals:

Managers / supervisors play a central role in the appraisal process, and should always be

included as one of the main appraisers. In essence, managers and supervisors have two roles in

performance appraisal:

1.“Judge”: assessing performance

2.“Coach”: providing constructive feedback and identifying areas for improvement.

Performing both roles simultaneously can be difficult. Employees may be reluctant to admit

areas for improvement if performance assessment is linked with desired outcomes such as pay,

promotion or opportunities to work in desired areas. One solution is to separate the judge and

coach roles by conducting separate appraisal meetings.

Self-appraisals:

The process of evaluating one’s own performance can help to increase employee’s commitment

to the appraisal process, perceptions of appraisal fairness, and satisfaction with the appraisal

process. Self-appraisal can also be useful for identifying areas for development. Not surprisingly,

self-appraisals are usually biased towards leniency. Strategies to increase the accuracy of self

appraisals include:

a) Using clear definitions of performance criteria linked to specific, observable

behaviours

b) Informing employees that their ratings will be checked and compared to other sources

of appraisal (i.e., for accuracy)

c) Ensuring employees receive regular feedback on their performance.

It is recommended that self appraisals are used for professional development purposes, rather

than for making administrative decisions (i.e., pay increases, promotion).

Coworker appraisals:

Coworkers can provide valuable feedback on performance, particularly where teamwork occurs.

Coworkers are often aware of different aspects of a employee’s performance that managers

/supervisors may not have the opportunity to observe. In addition, as there is usually more than

one coworker who rates a worker’s performance, their evaluations tend to be more reliable.

Coworker evaluations, however, may be biased towards those individuals most well liked in an

organisation (i.e., friendship bias). Furthermore, coworker appraisals may have a negative impact

on teamwork and cooperation if employees are competing with one another for organizational

incentives and rewards. It is recommended that coworker appraisals are used for professional

development rather than administrative decisions.

Subordinate appraisals:

Subordinates are a valuable source of information regarding particular aspects of a supervisor or

leader’s performance such as communication, team building or delegation. Subordinates can

provide feedback to help managers / supervisors develop their skills in these areas. The focus

should be on aspects of managerial performance that subordinates are able to comment upon.

This source of appraisal may only be appropriate in larger organisations where there are

sufficient subordinates to allow anonymity.

Client appraisals:

Clients may also offer a different perspective on a employee’s performance, particularly for jobs

that require a high degree of interaction with people. For example, client appraisals can be a

valuable source of feedback regarding the quality of service provision (e.g., the quality of

interaction, degree of empathy, level of support, degree of professionalism).

Organisations often have performance contracts that specify goals and deliverables for client

outcomes. Whilst it is important that organisational goals and deliverables are reflected in the

appraisal criteria for individuals and teams, it is recommended that particular care be taken if

incorporating client outcomes.

Relying on client outcomes as an indicator of performance can have undesirable effects due to

the complex and sensitive nature of work. A range of factors may influence client outcomes,

many of which are outside the control of an individual employee. It is rare for a successful (or

otherwise) outcome to be the sole result of one person’s efforts. This makes client outcomes a

poor reflection of the quality of treatment provided by the employee. For example, “good”

employee performance will not always bring about client improvements, and client relapses may

not be due to “poor” employee performance.

In addition to considering client outcomes, it may also be beneficial to focus on employee’s

skills and abilities in providing services per se (i.e., independent of client outcomes).

Strategies to support appraisers and enhance appraisal accuracy

Rating another person’s performance is not an easy task, particularly with complex jobs or

performance criteria. Strategies to support appraisers and increase the likelihood of accurate

assessments include:

Providing practical training in rating techniques, which includes opportunities to practice

appraising performance and providing feedback

Limiting the assessment to performance criteria that an appraiser has

observed /experienced in regard to the employee

Providing structured assessment tools with clear explanations regarding the criteria to be

assessed, and performance standard.

iv. Conduct an Appraisal Interview

The next step in a performance appraisal is to conduct the appraisal interview. The two central

purposes of the appraisal interview are to:

Reflect on past performance to identify major achievements, areas that require further

development, and barriers / facilitators to effective performance

Identify goals and strategies for future work practice.

As discussed below, supervisors and managers can use a range of strategies to ensure that the

appraisal interview is positive, constructive and of greatest benefit for employee’s effectiveness.

Before the interview

1. Help employees to become familiar and comfortable with talking about their performance

by engaging in regular, informal communication on work progress, potential obstacles

and issues, possible solutions and assistance

2. Encourage employees to prepare – employees should be encouraged to review their own

performance before the interview

3. Do your own preparation – plan ahead. Draft a list of the issues that you want to address

with the employee (i.e., strengths and weaknesses of performance, strategies to improve

performance). Give specific examples of the employee’s performances that you want to

highlight. During the interview

4. Encourage employee participation – start by inviting the employee to share their views

about their performance

5. Begin with positive feedback to put the employee at ease

6. Make it a two-way discussion

7. Set goals mutually – ensure employees participate in determining specific, challenging

but attainable goals for future work performance

8. Ensure that there is a clear agreement on performance objectives and the evaluation

criteria for the next year

9. Keep written records of the appraisal interview on which both parties have “signed off”.

After the interview

1. Coach employees regularly – provide frequent feedback to help employees improve their

performance

2. Assess progress towards goals frequently – periodic reviewing of progress towards goals

helps keep behaviour on track and enhances commitment to effective performance.

3. Relate rewards to performance – by linking appraisal results to employment decisions

such as promotions and salaries, employees are more likely to prepare for, participate in,

and be satisfied with the appraisal system.

v. Evaluate the Appraisal Process

As with any organisational system, the performance appraisal process should undergo regular

review and improvement. For example, the process of performance appraisal could be evaluated

by conducting focus groups or surveys with employees to gauge their satisfaction with the

appraisal process (and suggestions for improvements). It may also be useful to monitor the types

of issues raised by supervisors and employees over time. A successful performance appraisal

process should demonstrate a change in both the ratings of employee’s performance (i.e., ideally

performance ratings should improve, or at least remain at a satisfactorily stable level over time)

and the work environment (i.e., evidence that significant barriers to work practice are being

addressed by the organisation).

Methods of Performance Appraisal

Rating Scales: The rating scale method offers a high degree of structure for appraisals. Each

employee trait or characteristic is rated on a bipolar scale that usually has several points ranging

from “poor” to “excellent” (or some similar arrangement).

The traits assessed on these scales include employee attributes such as cooperation,

communications ability, initiative, punctuality and technical (work skills) competence. The

nature and scope of the traits selected for inclusion is limited only by the imagination of the

scale’s designer, or by the organization’s need to know. The one major provision in selecting

traits is that they should be in some way relevant to the appraisee’s job.

Advantages

The greatest advantage of rating scales is that they are structured and standardised. This allows

ratings to be easily compared and contrasted - even for entire workforces. Each employee is

subjected to the same basic appraisal process and rating criteria, with the same range of

responses. This encourages equality in treatment for all appraisees and imposes standard

measures of performance across all parts of the organization.

Rating scale methods are easy to use and understand. The concept of the rating scale makes

obvious sense; both appraisers and appraisees have an intuitive appreciation for the simple and

efficient logic of the bipolar scale. The result is widespread acceptance and popularity for this

approach.

Disadvantages

Trait Relevance: Are the selected rating-scale traits clearly relevant to the jobs of all the

appraisees? It is inevitable that with a standardised and fixed system of appraisal that certain

traits will have a greater relevance in some jobs than in others.

For example, the trait “initiative” might not be very important in a job that is tightly defined and

rigidly structured. In such cases, a low appraisal rating for initiative may not mean that an

employee lacks initiative. Rather, it may reflect that fact that an employee has few opportunities

to use and display that particular trait. The relevance of rating scales is therefore said to be

context-sensitive. Job and workplace circumstances must be taken into account.

Systemic Disadvantage: Rating scales, and the traits they purport to measure, generally attempt

to encapsulate all the relevant indicators of employee performance. There is an assumption that

all the true and best indicators of performance are included, and all false and irrelevant indicators

are excluded.

This is an assumption very difficult to prove in practice. It is possible that an employee’s

performance may depend on factors that have not been included in the selected traits. Such

employees may end up with ratings that do not truly or fairly reflect their effort or value to the

organization. Employees in this class are systemically disadvantaged by the rating scale method.

Perceptual Errors:This includes various well-known problems of selective perception (such as

the horns and halos effect) as well as problems of perceived meaning.Selective perception is the

human tendency to make private and highly subjective assessments of what a person is “really

like”, and then seek evidence to support that view (while ignoring or downplaying evidence that

might contradict it).

This is a common and normal psychological phenomenon. All human beings are affected by it.

In other words, we see in others what we want to see in them.

An example is the supervisor who believes that an employee is inherently good (halo effect) and

so ignores evidence that might suggest otherwise. Instead of correcting the slackening employee,

the supervisor covers for them and may even offer excuses for their declining performance.

On the other hand, a supervisor may have formed the impression that an employee is bad (horns

effect). The supervisor becomes unreasonably harsh in their assessment of the employee, and

always ready to criticize and undermine them.

The horns and halo effect is rarely seen in its extreme and obvious forms. But in its more subtle

manifestations, it can be a significant threat to the effectiveness and credibility of performance

appraisal.

Perceived Meaning:Problems of perceived meaning occur when appraisers do not share the

same opinion about the meaning of the selected traits and the language used on the rating scales.

For example, to one appraiser, an employee may demonstrate the trait of initiative by reporting

work problems to a supervisor. To another appraiser, this might suggest an excessive dependence

on supervisory assistance - and thus a lack of initiative.As well, the language and terms used to

construct a scale - such as “Performance exceeds expectations” or “Below average skill” - may

mean different things to different appraisers.

Rating Errors: The problem here is not so much errors in perception as errors in appraiser

judgement and motive. Unlike perceptual errors, these errors may be (at times) deliberate. The

most common rating error is central tendency.

Busy appraisers, or those wary of confrontations and repercussions, may be tempted to dole out

too many passive, middle-of-the-road ratings (e.g., “satisfactory” or “adequate”), regardless of

the actual performance of a subordinate. Thus the spread of ratings tends to clump excessively

around the middle of the scale.

This problem is worsened in organizations where the appraisal process does not enjoy strong

management support, or where the appraisers do not feel confident with the task of appraisal.

Check-list Method:

Under this method, checklist of “Statements of Traits” of employee in the form of Yes or No

based questions is prepared. Here, the rater only does the reporting or checking and HR

department does the actual evaluation. The rater concerned has to tick appropriate answers

relevant to the appraisees. When the check-list is completed, it is sent to HR department for

further processing. Various questions in the check list may have either equal weightage or more

weightage may be given to those questions which are more important. The HR department then

calculates the total scores which show the appraisal result of an employee.

Advantages – economy, ease of administration, limited training required, standardization.

Disadvantages – Rater’s biases, use of improper weights by HR Dept, does not allow rater to

give relative ratings.

Force Choice Method:

A series of statements arranged in the blocks of two or more are given and the rater indicates

which statement is true or false. The rater is forced to make a choice. HR department does actual

assessment.

Advantages – Absence of personal biases because of forced choice.

Disadvantages – Statements may not be correctly framed.

Force Distribution Method: One of the problems faced in large organizations is relative

assessment tendencies of raters. Some are too lenient and others too severe. This method

overcomes that problem. It forces everyone to do a comparative rating of all the employees on a

predetermined distribution pattern of good to bad. Say 10% employees in Excellent Grade, 20%

in Good Grade, 40% in Average Grade, 20% in Below Average Grade and 10% in Unsatisfied

grade. The real problem of this method occurs in organizations where there is a tendency to pack

certain key departments with all good employees and some other departments with discards and

laggards. Relatively good employees of key departments get poor rating and relatively poor

employees of laggards’ departments get good rating.

Critical Incident Method:

In this method, only critical incidents and behavior associated with these incidents are taken for

evaluation. This method involves three steps. A test of noteworthy on the job behavior is

prepared. A group of experts then assigns scale values to them depending on the degree of

desirability for the job. Finally, a checklist of incidents which define good and bad employees is

prepared.

Advantages ---This method is very useful for discovering potential of employees who can be

useful in critical situation.

Disadvantages ---

a) Negative incidents are, generally, more noticeable than positive ones.

b) The recording of incidents is a core to the superior and may be put off and easily

forgotten.

c) Overly close supervision may result.

Essay Method:

In the essay method approach, the appraiser prepares a written statement about the employee

being appraised. The statement usually concentrates on describing specific strengths and

weaknesses in job performance. It also suggests courses of action to remedy the identified

problem areas. The statement may be written and edited by the appraiser alone, or it be

composed in collaboration with the appraisee.

Advantages 

The essay method is far less structured and confining than the rating scale method. It permits the

appraiser to examine almost any relevant issue or attribute of performance. This contrasts sharply

with methods where the appraisal criteria are rigidly defined.

Appraisers may place whatever degree of emphasis on issues or attributes that they feel

appropriate. Thus the process is open-ended and very flexible. The appraiser is not locked into an

appraisal system the limits expression or assumes that employee traits can be neatly dissected

and scaled.

Disadvantages 

Essay methods are time-consuming and difficult to administer. Appraisers often find the essay

technique more demanding than methods such as rating scales.

The techniques greatest advantage - freedom of expression - is also its greatest handicap. The

varying writing skills of appraisers can upset and distort the whole process. The process is

subjective and, in consequence, it is difficult to compare and contrast the results of individuals or

to draw any broad conclusions about organizational needs.

Grading:

In this method, certain categories of abilities of performance are defined well in advance and

person are put in particular category depending on their traits and characteristics. Such categories

may be definitional like outstanding, good, average, poor, very poor or may be in terms of letter

like A, B, C, D etc with A indicating the best and D indicating the worst. This method, however,

suffers from one basic limitation that the rater may rate most of the employees at higher grades.

Performance Tests & Observations:

This is based on the test of knowledge or skills. The tests may be written or an actual

presentation of skills. Tests must be reliable and validated to be useful.

Advantage – Tests only measure potential and not attitude. Actual performance is more a

function of attitude of person than potential.

Disadvantages – Sometimes costs of test development or administration are high.

Confidential Reports:

Though popular with government departments, its application in industry is not ruled out. Here

the report is given in the form of Annual Confidentiality Report (ACR). The system is highly

secretive and confidential. Feedback to the assessee is given only in case of an adverse entry.

Disadvantage is that it is highly prone to biases and recency effect and ratings can be

manipulated because the evaluations are linked to future rewards like promotions, good postings,

etc.

Comparative Evaluation Method (Ranking & Paired Comparisons):

These are collection of different methods that compare performance with that of other co-

workers. The usual techniques used may be ranking methods and paired comparison method.

Ranking Method:

Superior ranks his worker based on merit, from best to worst. However how best and why best

are not elaborated in this method. It is easy to administer.

Paired Comparison Method:

In this method each employee is paired with every other employee in the same cadre and then

comparative rating done in pairs so formed.

The number of comparisons may be calculated with the help of a formula – N x (N-1) / 2. The

method is too tedious for large departments and often such exact details are not available with

rater.

FUTURE-ORIENTED METHODS

MBO (management by objective) :

The use of management objectives was first widely advocated in the 1950s by the noted

management theorist Peter Drucker. MBO (management by objectives) methods of performance

appraisal are results-oriented. That is, they seek to measure employee performance by examining

the extent to which predetermined work objectives have been met. Usually the objectives are

established jointly by the supervisor and subordinate.

Once an objective is agreed, the employee is usually expected to self-audit; that is, to identify

the skills needed to achieve the objective. Typically they do not rely on others to locate and

specify their strengths and weaknesses. They are expected to monitor their own development and

progress.

Advantages

The MBO approach overcomes some of the problems that arise as a result of assuming that the

employee traits needed for job success can be reliably identified and measured. Instead of

assuming traits, the MBO method concentrates on actual outcomes. If the employee meets or

exceeds the set objectives, then he or she has demonstrated an acceptable level of job

performance. Employees are judged according to real outcomes, and not on their potential for

success, or on someone’s subjective opinion of their abilities.

The guiding principle of the MBO approach is that direct results can be observed, whereas the

traits and attributes of employees (which may or may not contribute to performance) must be

guessed at or inferred. The MBO method recognizes the fact that it is difficult to neatly dissect

all the complex and varied elements that go to make up employee performance. MBO advocates

claim that the performance of employees cannot be broken up into so many constituent parts - as

one might take apart an engine to study it. But put all the parts together and the performance may

be directly observed and measured.

Disadvantages

MBO methods of performance appraisal can give employees a satisfying sense of autonomy and

achievement. But on the downside, they can lead to unrealistic expectations about what can and

cannot be reasonably accomplished. Supervisors and subordinates must have very good “reality

checking” skills to use MBO appraisal methods. They will need these skills during the initial

stage of objective setting, and for the purposes of self-auditing and self-monitoring.

Unfortunately, research studies have shown repeatedly that human beings tend to lack the skills

needed to do their own “reality checking”. Nor are these skills easily conveyed by training.

Reality itself is an intensely personal experience, prone to all forms of perceptual bias. One of

the strengths of the MBO method is the clarity of purpose that flows from a set of well-

articulated objectives. But this can be a source of weakness also. It has become very apparent

that the modern organization must be flexible to survive. Objectives, by their very nature, tend to

impose a certain rigidity. Of course, the obvious answer is to make the objectives more fluid and

yielding. But the penalty for fluidity is loss of clarity. Variable objectives may cause employee

confusion. It is also possible that fluid objectives may be distorted to disguise or justify failures

in performance.

Assessment Center Method:

This technique was first developed in USA and UK in 1943. An assessment centre is a central

location where managers may come together to have their participation in job related exercises

evaluated by trained observers. It is more focused on observation of behaviours across a series of

select exercises or work samples. Assesses are requested to participate in in-basket exercises,

work groups, computer simulations, role playing and other similar activities which require same

attributes for successful performance in actual job.

Advantages – Well-conducted assessment centre can achieve better forecasts of future

performance and progress than other methods of appraisals. Also reliability, content validity and

predictive ability are said to be high in Assessment Centres. The tests also make sure that the

wrong people are not hired or promoted. Finally, it clearly defines the criteria for selection and

promotion.

Disadvantages – Concentrates on future performance potential. No assessment of past

performance. Costs of employees travelling and lodging, psychologists. Ratings strongly

influenced by assessee’s inter-personal skills. Solid performers may feel suffocated in simulated

situations.

360o Appraisal:

It is a technique in which performance data/feedback/rating is collected from all sections of

people employee interacts in the course of his job like immediate supervisors, team members,

customers, peers, subordinates and self with different weightage to each group of raters. This

technique has been found to be extremely useful and effective. It is especially useful to measure

inter-personal skills, customer satisfaction and team building skills.

One of the biggest advantages of this system is that assesssees cannot afford to neglect any

constituency and has to show all-round performance. However, on the negative side, receiving

feedback from multiple sources can be intimidating, threatening, expensive and time consuming.

Psychological Appraisals:

These appraisals are more directed to assess employees potential for future performance rather

than the past one. It is done in the form of in-depth interviews, psychological tests, and

discussion with supervisors and review of other evaluations. It is more focused on employees

emotional, intellectual, and motivational and other personal characteristics affecting his

performance.

This approach is slow and costly and may be useful for bright young members who may have

considerable potential. However quality of these appraisals largely depends upon the skills of

psychologists who perform the evaluation.

COMPANY PROFILE

SEW Infrastructures

In the year 1959,Sri. Vallurupalli Nageswara Rao, founded 'Southern Engineering Works' (SEW)

in Vijaywada, A.P. India, with late Sri. Y. Purnachandra Rao and Sri. Y.M.G. Nageswara Rao as

co-founders to pursue civil engineering construction activities. The first project SEW worked on,

was the prestigious Nagarjuna Sagar Dam in Andhra Pradesh. During the period of expansion,

other partners joined the company and contributed to the growth of the organization to its present

status

In the year 1967, the seventh year since founding, SEW was awarded a Gold Medal by the then

Hon’ble Prime Minister of India Shrimati Indira Gandhi for the record progress of stone masonry

in a single day at Nagarjuna Sagar Dam.

With the experience gained at the Nagarjuna Sagar Dam, the company participated in the

building of other major dams of Tawa, Bargi, Bansagar, Hasdeo Bango, in Madhya Pradesh &

Srisailam and Priyadarshini Jurala in Andhra pradesh. SEW attained specialization in the

construction of high dams due to the experience gained in the opportunities available in the

beginning years of its founding.

In the year 1983, the company was converted to a Private Limited Company with the name SEW

Constructions Ltd.

Over the years, SEW Constructions Ltd., has diversified into construction of

Lined Irrigation Canals

Hydel, Thermal and Gas based Power

Industrial, Commercial and Residential Buildings

Dams & Barrages

Lift Irrigation Schemes

Canal Structures

Roads and Bridges

Fabrication and Erection of Gates

Water Supply Projects

Transmission Lines

In the year 2008, the company was renamed as SEW Infrastructure Ltd. to highlight our

commitment to infrastructure project works.

We derive our strength from the shareholders and employees and the company accords top most

priority for their growth. Our company is backed by a large team of talented, committed and

loyal employees, sub- contractors and suppliers.

We continue to aim towards being a leader in the construction industry with strong client

relationships, dedicated and satisfied workforce with an impeccable reputation to be the top

quality provider without cost and time overruns.

Vision

"To be a leader in the construction industry setting standards in technology, quality &

deliverables while ensuring growth of employees and creating value to share holders.”

Core Values

We actively demonstrate our Core Values at all times because we are a customer and employee

oriented organization delivering maximum value to our stakeholders.

We always Do what we say

We do our BEST to EXCEL in everything

We RESPECT and COLLABORATE with each other to succeed

We continually CHANGE and INNOVATE to IMPROVE

We strive to ENRICH our STAKEHOLDERS and COMMUNITY

Strength

Dependability is a cherished quality amidst uncertainties. SEW Infrastructure Ltd., earned

several accolades for competence, dedication and quality. Having gained experience of handling

men and machinery, a fast pace for an impressive growth is now set.

Specialising in the development of sustainable infrastructure, SEW diversified into allied

strategic business areas, which are wide ranging and impressive by any standards. A total

commitment to quality and time has earned SEW the reputation of a highly dependable

company.

Strong Technical and Management team to identify, develop and execute all types of

infrastructure projects.

Experienced and well equipped state of the art in house Design facility to execute EPC

projects.

Meeting and exceeding customer expectations of project completion dates and quality

Proven qualification credentials to take up big size projects

Capability in bringing together Joint Venture Partners to take up mega projects of high

value.

Clients

AD Hydro Power Limited, Bhilwara Group

Aditya Hospitals (P) Ltd

Andhra Pradesh State Electricity Board

Andhra Pradesh State Road Transport Corporation

BSES-Andhra Power Ltd

Bharat Energy Ventures Limited

Bharat Heavy Electrical Limited

Bharat Heavy Electricals Ltd

Bharat Oman Refinery Ltd

Chattisgarh State Electricity Board

DANS Energy Private Ltd

Domus Infra Projects Pvt. Ltd

GATI Infrastructure Ltd

GMR Jadcherla Expressways Private Ltd

GMR Projects Private Ltd

GMR hyderabad international airport Ltd

Ginni Global Ltd

Guntur Vikas (P) Ltd

HEG Ltd.(Manideep)

Harayana Vidyut Prasaran Nigam Ltd

Indore Municipal Corporation

Institute of Management Technology

Irrigation & CAD Department, Government of Andhra Pradesh

Irrigation Deparment, Govt of Chhattisgarh

Irrigation Department,Govt of Madhya Pradesh

JSW Energy (Ratnagiri) Ltd

Karnataka Neeravari Nigam Ltd

Kelo Project Survey Division

Krishna Valley Development Corporation, Govt. of Maharashtra

Larsen & Toubro, ECC Division

Madhya Pradesh Power Transmission Company Ltd

Madhya Pradesh State Electricity Board

Maharashtra State Power Generation Co Ltd

Malana Power Company Ltd

Meghalaya State Electricity Board

Minor Irrigation Divison

Mumbai Metro One Private Ltd

Nagpur Municipal Corporation

Narmada Valley Development Corporation, Govt. of Madhya Pradesh

National Buildings Construction Corporation Ltd

National Highways Authority of India

North Eastern Electric Power Corporation

Power Grid Corporation Of India Limited (PGCIL)

Prasad & Company (Project works) Ltd

Public Health Engineering Department, Govt. of Madhya Pradesh

Rajasthan Rajya Vidyut Prasaran Nigam

Rashtriya Ispat Nigam Limited

Rashtriya Ispat Nigam Ltd (Visakhapatnam Steel Plant)

Reliance Innoventures Private Limited

Shree Maheshwar Hydel Power Corporation Ltd

Shree Ram Urban Infrastructure Ltd

South Eastern Coal Fields Ltd

Southwest Infrastructure Pvt. Ltd

State Electricity Board, Government of Meghalaya

Tapi Irrigation Development Corporation, Govt. of Maharashtra

Teesta Urja Ltd

Utility Energytech Engineers Private Ltd

Uttar Pradesh Power Transmission Corporation Limited (UPPTCL)

VA Tech Escher Wyss Flovel Ltd

Vallurupalli Rattayya & Seethamma Charitable Trust

Visakhapatnam Municipal Corporation

Water Resources Department, Govt. of Chhattisgarh

Water Resources Department, Govt. of Madhya Pradesh

Commitment

Environment Responsibility

SEW is committed to safeguarding the environment. All our projects, whether it is a hydro

electric project, a dam, a new road, or a new airport facility, has the potential to affect people,

flora and fauna and the surrounding land. Whether it is cement in the form of concrete for the

structure or fossil fuel in the form of electricity to provide energy, environmental aspects play an

important part in throughout the life cycle of a project.

Our goal always is to protect the environment during a project, and to build in safeguards that

will keep protecting it long after the project is complete.

Operating ecologically and using limited resources sparingly is a matter of course for SEW. It is

our objective to identify the environmental impact of all projects and activities early on and to

keep this to a minimum.

We make sure that every project we undertake meets or exceeds the national and local

governmental regulations for air, water and sound quality. We also take steps to mitigate

potential impact on nature at and near project sites. That includes creating new habitats for

animals and birds by planting trees to replace any that must be removed.

Our environment protection policies are certified to ISO 14001 on all projects across SEW.

These are integrated into the core business processes from site planning to waste disposal.

Using the ISO 14001 as a guideline we have put in place a series of practices and procedures to

manage our commitment towards prevention of pollution and minimization of other negative

impacts on the environment.

Quality Commitment

Quality objectives are established for all processes of the organization in line with Quality

Policy. Management Review meetings are conducted periodically at various levels to ensure the

effectiveness and adequacy of the Quality Management System. Learning out of corrective &

preventive actions provides opportunity for improvement.

CLIENT FOCUS

Processes are established for client communication on suggestions for improvements,

information on status and meetings. Client feedback is obtained once in three months by the

project in-charge. Areas of dissatisfaction / improvements, if any, are discussed in the site

management review meetings and corrective actions taken based on those inputs.

During the project execution, the client interaction is maintained on a continuous basis and the

requirements are met on a regular basis as per the documented “Project Quality Plan”.

QUALITY POLICY

Our “Quality Policy”, is consistent with the SEW Vision & Core Values:

Shows commitment to comply with the requirements and continually improve the

effectiveness of the Quality Management System.

Provides a frame work for establishing and reviewing quality objectives.

Communicated and understood within the organization.

The policy is communicated to all by displaying at strategic locations and through

Quality manual, which is being distributed to all sections and intend being circulated to

all employees of SEW.

Reviewed for continuing suitability, once in two years.

QUALITY OBJECTIVES

To incorporate state of the art technology in the areas of design, construction, materials,

processes and machinery.

Progressive wastage elimination.

Continuous training of all employees towards empowerment saving decision making

time.

To reduce impact on environment at the project site and to progressively achieve

pollution certification.

QUALITY MANAGEMENT SYSTEM

SEW’s Quality Management System (QMS) is taking appropriate steps to improve its

effectiveness in accordance with the requirements of ISO 9001 requirements &

guidelines.

Procedures are established to specify the methods and criteria for effective operation,

control and necessary resources and information to support the operation and monitoring

of these processes.

o 1. Procedure for monitoring, measuring and analyzing of these processes and to

take necessary actions to achieve planned results and continual improvement of

these processes. It has also maintained relevant procedures to identify and

exercise required control over outsourced processes, if any

o 2. The responsibilities and authorities for each function are defined. These include

planning, operations, control, review and monitoring and corrective / preventive

action as appropriate for respective functions. Effectiveness of the Quality

Management System is evaluated through review meetings at various levels and

course correction made accordingly. The monthly meetings have pre defined

agenda. The information flow is affected through the minutes of meetings to

ensure that both operation and control of these processes are effective and

transparent.

o 3. Minute planning is done for each project site for the efficient management of

Human Resource, Plant & Machinery and other requirements. Well-established

systems exist for acquisition, monitoring & control of effective utilization of the

resources against annual targets set.

o 4. MIS is the tool used in organization for systematic data collection and

reporting. This data is used to analyze, reviewed and monitor region / sites at

different levels and collated by Management committees. Action plans are

developed and communicated to concerned persons for implementation and

improvement.

o 5. Persons responsible for implementation do so as per plan; results are measured

against targets set. Performance measurement aims at continual improvement;

inability to do so calls for review of processes to improve effectiveness.

Wherever the processes are outsourced for some specific products (projects/contracts), these are

controlled in accordance with the documented Quality Management System.

QUALITY MANUAL

A “PROJECT QUALITY PLAN” is maintained for all project sites in SEW, that includes the

quality manual, work procedures and work instructions.

Employee Safety

At SEW Safety is of paramount importance to us, a value that is fundamental to our culture.

SEW has pursued zero incident programs on it's nationwide projects to heighten the sense of

safety consciousness in every job we do. We strictly enforce the use of all safety equipment

available to every worker on our sites. We have an extensive deployment of impact, electrical

and fire protection systems available to ALL workers on EVERY project.

We believe that every accident, every injury, no matter how small, is preventable, and we embed

that philosophy into every SEW project through a combination of technical field procedures and

ongoing training programs.

Our dedication to safety helps keep workers safe, and it also pays off for our stakeholders. Our

operating costs go down and productivity goes up because less time is lost to accidents and

results in savings on insurance premiums.

The OHSAS 18001 standard for Occupational Health and Safety is used as a guideline to

develop our health and safety management systems.

SEW implemented a variety of programs and processes, to address the issues around

ergonomics, machine guarding and the use of personal protective equipment to achieve greater

protection and to prevent occupational injury and illness of employees, contractors and visitors.

All employees are committed to identifying and reporting safety concerns and are involved in

implementing solutions for any potential hazard.

We have developed formal safety management systems which are being implemented across all

projects. A task group to look at independent auditing performs periodic safety inspections to

ensure the internal standards on workplace safety are being followed.

Safety audit is a key element of safety management. We subject our safety management systems

to extensive internal audit scrutiny to ensure adherence to our best practices and standards. All

projects maintain programmes for internal audit and inspection, to monitor implementation of

operational controls.

The Project Safety Task Force, chaired by the Managing Director is established to develop a

company policy, review performance, launch new initiatives, and ensure good practices are

shared across all projects nationwide.

SEW has a setup a nationwide helpline in place for reporting of accidents and incidents of all

types (safety, health, environment, quality, security, complaints etc). This also helps perform a

common underlying case analysis and a powerful facility to track actions from investigations,

audit and risk assessment.

We also ask our subcontractors and partners to adopt our commitment to safety and health for

exceptional safety performance, even in hazardous work environments, severe weather, and

remote locations.

SEW provides a blanket insurance cover to all its employees employed on project sites to cover

the risk of personal accidents and emergency medical attention etc.

SAFETY PROGRAMS

SEW strives to be a leader in employee safety. We have extensively deployed safety equipment

and programs available ALL our workers on project sites. These include:

Light weight hard hats, eye and face protection, and improved tools and equipment.

Full-body harness to fall protection of employees working at heights.

Injury prevention program of stretching exercises and training in lifting techniques.

A worker-based safety program that puts the responsibility for changing and eliminating

unsafe practices in their hands with support from project management.

An program to protect workers who work in underground tunneling areas.

Supplier Engagement

Our suppliers and subcontractors are extremely valued members of SEW’s contracting and

procurement functions supporting the company’s strategy and varied service offerings of

irrigation, power, transportation and buildings. SEW counts on the quality, consistency and

integrity of all services and products delivered by it's suppliers. Jointly we share the common

objectives of enhancing our stakeholder value and advancement of our strategic business

objectives while conforming to the strict moral code of dignity of labour, equal opportunity, fair

competition and respecting mutual business interests.

We continually encourage our suppliers to excel in the mutual goals of on-budget performance,

on-time quality delivery, enforcement of safe work environment, fairness in labour compensation

and transparency of business practices.

SEW's PROCUREMENT ORGANIZATION

Our procurement is conducted from the SEW head office as well as the project sites. Our staff is

segmented into experienced specialists for contracting, procuring and materials management.

Most are people dedicated to direct support of our projects while others play a more indirect role

by providing functional services to our projects.

Each project has its own commercial team responsible for obtaining the correct materials and

services, validating capabilities of our prospective vendors, managing the bid cycle, ensuring a

fair evaluation of each responsive bidder is conducted prior to award, and monitoring quality and

schedule. This team consists of several specific disciplines which include Finance, Contracts,

Procurement, Inventory Management, Quality Enforcement and Project Management.

Purchase order requirements and specifications adherence will be checked by the Quality

Assurance / Inventory Management team. Equipment and Materials receipt will be provided on

the spot when such deliveries are made. Industry codes and standards will be applied non-

conforming quality and manufacturing issues will be identified before such issues impact quality

of project works.

PRINCIPLES OF SUPPLIER AND SUBCONTRACTOR ENGAGEMENT

SEW maintains the highest standards of integrity in its dealings with suppliers and

subcontractors

SEW follows rigorous and transparent procedures to select it's suppliers and

subcontractors

Every qualified supplier will be provided equal opportunity and afforded fair treatment

Our expectations will be clearly set and documented

We will be available for a review of our relationship to address performance

improvement opportunities

We aim to fully meet our contractual obligations to ensure and protect our joint interests

We will protect the confidentiality of quotations and other 3rd party information

entrusted to us

We always will strive to avoid placing our employees in positions of potential conflict of

interest

We will always strive to promote fair competition among our suppliers in the interests of

SEW, acting in accordance with the law

ETHICS AND SAFETY

We are committed to the highest safety and ethical standards in the industry and expect the same

from our suppliers and subcontractors. We seek suppliers and subcontractors who understand

SEW's obligations to it's clients and other stakeholders.

SEW seeks to apply high standards of ethics and professional practices in it's supply chain

operations. Our practices are governed by the following core principles:

Adherence to the law of the land

All applicable legal obligations must be observed based on the area of operations

Bribery and corruption will be strongly dealt with Employee rights & safe working

environment

All Human Rights and labour laws should be observed

Equal opportunities of employment should be provided regardless of caste, color, gender

and religious preferences.

Respect personal dignity of all individuals employed

Deal with a sense of fairness and provide access to the judicial system

Provide all safety equipment and training facilities to employees

Prohibition of child labour

Indian Child Labour (Prohibition & Regulation) Act, 1986 and subsequent rules should be

strictly adhered to

Environment sensitivity

We require our subcontractors and suppliers to promote environment sensitivity, be aware of the

risks involved and have sound mitigation practices

Social Responsibility

The main charitable activities of SEW are handled through SEW Charitable Trust with our

founder Sri. Vallurupalli Nageswara Rao and Sri. Vallurupalli Raja Rama Mohan Rao as the

trustees.

The trust is fully funded and supported by SEW Infrastructure Ltd.

Core Principles of the Trust

To provide education, establish maintain, run, develop, improve and extend Educational

institutions

To provide boarding and lodging facilities to students and working youth and to render

help financially to deserving students

To establish maintain, run, develop, improve and otherwise assist in setting up of

Libraries, Reading Rooms and other facilities including publication of books, journals,

pamphlets etc.

To establish, maintain, run, develop, improve and otherwise assist in setting up of

vocational training centers and similar other institutions

To conduct and carry on classes for propagation of adult education, to take over any

existing educational institutions or vocational training centers and to conduct, maintain,

run, develop and improve the same subject to the regulations of the Government in this

behalf

To establish Hospitals, Nursing Home. Clinics, Health units, Homes for the aged etc., and

provide medical facilities to the public

AREAS OF IMPACT

EDUCATION

Supporting education for the needy children

Supported institutions such as Anadha Vidyarthi Griha, Vaidehi Seva Samithi, Bhoja Krishna

Narayana Desha Seva Trust to contribute to their social service activities in providing education

for the poor and the underprivileged children.

School Adoption and Mid-Day Meal Programs

SEW supports the cause of education based empowerment to uplift the socially and

economically disadvantaged sections of the society by adopting Government Schools lacking in

standard infrastructure facilities. This includes:

Student sponsorship

Capacity building

Mid-day meals

Drinking water and sanitation

Building school infrastructure

Maintenance of playgrounds

Upgrading libraries, laboratories, and computer labs

Extra-curricular activities such as science exhibitions, health camps etc.

As part of our ‘Empower with Education’ programs we have also supported special needs

children that are mentally handicapped, deaf and dumb.

Vocational Training

Established a vocational training institute at Bachupally, Hyderabad, with facilities to provide

employment-oriented training to poor people.

During the Financial year 2008-09, about 400 unemployed youth, belonging to the various parts

of the country, have been trained in activities such as plumbing, electrical, farm work carpentry,

masonry with free boarding and lodging facilities on campus.

Higher Education

Supporting Vignana Jyothi an organization promoting the VNR College of Engineering &

Technology (named after our founder Sri. Vallurupalli Nageswara Rao) among numerous other

schools and colleges.

MEDICAL CAMPS AND RED CROSS

In addition to supporting the Red Cross Society of India, the SEW Charitable Trust as conducted

free medical camps in associations with hospitals such as the Asian Institute of Gastro-

Entrology, Hyderabad.

CULTURAL

Supports the development and sustenance of Indian classical music, dance and other cultural

activities via South India Cultural Association (SICA).

SPORTS

Promotes activities to identify talent and generate opportunities for the underprivileged children

in sports such as gymnastics and cricket by supporting the ‘Sports Coaching Foundation’.

Infrastructure Industry

Infrastructure Industry in India have been experiencing a rapid growth in its different sectors

with the development of urbanization and increasing involvement of foreign investments in this

field. The Indian government has taken initiatives to develop the infrastructure sector, with major

emphasis on construction, engineering, IT, entertainment, textiles, food, and utility to name

some.

Reports of different segments in Infrastructure Industry:

The section of the construction industry of Infrastructure Industry in India reported an estimated

growth of 6.78% year-on-year in 2006. The industry in India is highly fragmented and has about

300,000 construction companies operating nationwide. The government has allowed 100%

foreign equity in the construction industry. Among the major infrastructure projects are the

US$7-8bn India-Iran gas pipeline, the US$2.8bn construction of two power plants, and the

US$2.3bn power project in Tamil Nadu.

Heavy Engineering Industry is one of the largest segments of Infrastructure Industry in India. It

includes a whole range of industries such as Heavy Electricity Machinery, Turbines, Generators,

Transformers, Switchgears, Textile Machinery etc. all of which are essential infrastructure for

the development of industrial sector in India. For proper industrial development the utility

commodities like the switchgear and control gear, MCBs, air circuit breakers, switches,

rewireable fuses and HRC fuses with their respective fuse bases, holders and starters are

produced. Construction machinery, equipment for irrigation projects, diesel engines, tractors, and

transport vehicles, cotton textile and sugar mill machinery are other manufactured objects of

great demand of the Infrastructure Industry. Some major areas where these are in use are the

multi-crore projections for power generation like nuclear power stations, petrochemical

complexes, and chemical plants integrated steel plants, non-ferrous metal units etc. In India

BHEL is the largest engineering and manufacturing enterprise in the energy related infrastructure

sector, manufacturing over 180 products under 30major product groups and catering the core

sectors of the Indian Economy.

RESEARCH METHODOLOGY

Scope of the study: The aim of the study is to find out the level of awareness among the

employees about the performance appraisal system adopted in the organization and the steps

involved in the appraisal system. The study focuses on how effective is the performance

appraisal system by taking into account various factors that affect the effectiveness.

Objectives:

1. To effect promotions based on competence and performance.

2. To confirm the services of probationary employees upon their completing

the probationary period satisfactorily.

3. To assess the training and development needs of employees.

4. To decide upon a pay raise where (as in the unorganized sector) regular pay scales have

not been fixed.

5. To let the employees know where they stand insofar as their performance is concerned

and to assist them with constructive criticism and guidance for the purpose of

their development.

6. To improve communication. Performance appraisal provides a format for

dialogue between the superior and the subordinate, and improves understanding of

personal goals and concerns. This can also have the effect of increasing the trust between

the rater and the rate.

Sampling:

Population: Population is defined as the consumers of cell phones.

Sampling method: Non-probability sampling (convenience sampling)

Sample size: 100

Data and Sources of data:

The study is based mainly on primary data. Primary data will be collected through the

issue of questionnaire to the customers of mobile services who had switched their service

provider at least once during the past one year. Care has to be taken to see that the sample

represented all socio-economic and demographic users of mobile customers.

Secondary Sources:

The secondary sources of data include data from magazines, Internet, Books, and various

marketing journals.

Limitations:

1. The study is done in only one organization hence it cannot be generalized to the

whole industry.

2. Another major constraint was the time. The study is undertaken for a period of 60

days only.

DATA INTERPRETATION

1. How long have you working in the present organization?

Less than 1yr

1-2yrs

2-5yrs

5-10yrs

Above 10yrs

INTERPRETATION:

Most of the employees in the Organization are relatively old because a minority of them (i.e.

14%) has between one and two years of experience in the Organization. 28 respondents have 2 –

5 years of experience, 23 respondents have 5 – 10 years of experience, 20 respondents have

above 10 years of experience, 15 respondents have 1 – 2 years of experience the remaining 14

respondents are associated less than one year.

2. Are you aware of Performance Appraisal System in the Organization?

Yes

No

Interpretation:

Due to the fact that most of the employees (66%) are experienced in this sector before, they are

aware of the Performance Appraisal model used in the Organization. According to the graph,

66% of the respondents are aware of performance appraisal system in the organization while

34% of the respondents are not aware of performance appraisal system.

3. Were you informed about the Performance Appraisal model, used in the Organization,

during your induction?

Yes

No

Interpretation:

In the pie graph, it is observed 58% of the respondents are informed about the performance

appraisal model during the induction and 42% of the respondents are not informed about

performance appraisal model during the induction.

4. “The performance appraisal system is sufficient in assessing goals and objectives of the

Organization.” Do you agree with this statement?

Strongly agree

Agree

Neither agree nor disagree

Disagree

Strongly disagree

Interpretation:

According to the chart, it is mentioned that 36 respondents agree and 23 respondents strongly

agree that the performance appraisal system is sufficient in assessing goals and objectives of the

organization. 12 respondents disagree and 7 respondents strongly disagree that the performance

appraisal system is insufficient in assessing goals and objectives of the organization. The

remaining 22 respondents are given neutral response about the performance appraisal system.

5. How important is the Performance Appraisal to improve your Performance, according

to you?

Most important

Important

Not important

Not at all important

Interpretation:

According to graph, 34 respondents believe it is important, 26 respondents believe it is most

important that the performance appraisal will encourage and improve performance. 26

respondents believe that it is not so important and 14 respondents believe that it is not all

important to improve the performance appraisal to improve performance.

6. In your opinion, does the Performance Appraisal System give a proper assessment of

your contribution to the organization?

Yes

To some extent

No

Interpretation:

About 42% of the respondents say that the Performance Appraisal System does give a true and

fair view of their contribution to the Organization. This does include employees who think that

their rating does not always turn up to be correct as per their opinion. The group of respondents

who have replied in the negative(24%), also include candidates who say that the appraisal does

not turn out to be right most of the times but do show a fair view sometimes.

7. Are you able to achieve your target set by the Performance Appraisal System?

Yes

To some extent

No

Interpretation:

This does show that the satisfaction level of the employees (53%) in this system is quite high and

that there is a general feeling of likeability among the respondents.

8. Which kind of reward did you get from the superior for your performance?

Salary increment

Appreciation

Promotion

Bonus payment

Others

Interpretation:

According to the graph, 40 respondents are reward with salary increment, 24 respondents with

appreciation, 15 respondents with promotion, 13 respondents with bonus payment and the

remaining 8 respondents with other types of rewards.

9. What is your satisfaction level with your superior’s efforts to identify your strengths and

weaknesses?

Highly satisfied

Satisfied

Neither satisfied nor dissatisfied

Not satisfied

Highly dissatisfied

Interpretation:

From the above graph, it was observed that 61 respondents had overcome with the superior’s

effort to identify the strength and weakness of each and every individual. For 16 respondents the

superior’s efforts did not help to identify the strength and weakness of the employees.

10. In which stage do you think that appraisal should communicate with employees with

regard to Performance Appraisal System?

Goal-setting stage

Data-gathering stage

Mid-term reviews

Annual reviews

Interpretation:

According to the graph, 31 respondents prefer at data gathering stage, 25 respondents prefer at

goal setting stage, 24 respondents prefer at midterm reviews and the remaining 20 respondents

prefer at annual reviews.

11. According to you, how often does performance appraisal match to your expectation?

Every time

Often

Sometimes

Rarely

Never

Interpretation:

According to the graph, 29 respondents reach frequently, 23 respondents occasionally, 20

respondents sometimes, 16 respondents every time and 12 respondents never received the

performance appraisal.

12. To what extent, supervisor gives feedback to the employees regarding performance

appraisal?

To a very great extent

To a considerable extent

To some extent

To a very little extent

None of the above

Interpretation:

Any company should give feedback to the employees periodically. They can also extend proper

diagnostic tips/ counseling methods at the required level. According to the graph, 31 respondents

feel to some extent, 21 respondents to a considerable extent, 21 respondents to a great extent. 16

respondents feel to a very little extent. While the remaining 11 respondents say that the

supervisor will never give the feedback to the employees regarding performance appraisal.

13. Do you agree that superior allows employees to view their performance evaluation?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

Interpretation:

Half of the respondents (53) say the superior allows employee to view their performance

evaluation. 16 respondents are having neutral opinion on the same. While 24 respondents

disagree and 7 strongly disagree that the superior does not allow employees to view their

performance evaluation.

14. What are the areas that should be improved upon?

Standards

Frequency of appraisal

Appraiser

Interpretation:

From the above Pie graph, 47% of the respondents say that there should be a change in the

standards of the company, 31% of the respondents believe in the frequency of appraisal and 22%

of the respondents believe to change the evaluator.

15. Do you agree that organization is documenting individual performance to support

compensation and career planning decisions?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

Interpretation:

According to the graph, 25 respondents agree and 17 respondents strongly agree that the

individual performance will play a important role to support compensation and career planning

decisions. While 18 disagree and 9 strongly disagree that the individual performance will not

support compensation and career planning decisions. The remaining other 31 respondents neither

agree nor disagree with the above statement.

16. To what extent, the organization motivate employees after appraisal to develop and

improve performance?

To a very great extent

To a considerable extent

To some extent

To a very little extent

None of the above

Interpretation:

According to the graph, 20 respondents agree to a very great extent and 19 to a considerable

extent that the organization motivates employees after appraisal. 37 respondents feel that the

organization motivates to some extent while 16 respondents to a very little extent. 8 respondents

feel that none of the above factors motivates the employee’s appraisal in the organization.

17. Is your performance is only measured with the review of past performance?

Yes

No

Interpretation:

87% of the respondents believe that performance is measured on the previous past performance

while 13% of the respondents did not agree with the above statement.

18. Evaluating performance and delivering incentives are carried out in a fair and

consistent manner.

Do you agree with this statement?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

Interpretation:

From the above chart, 29 respondents believe and 22 respondents strongly believe that the

evaluation of performance and delivering the incentives are carried out in a fair and consistent

manner. 15 respondents disagree and 11 strongly disagree that the evaluation of performance and

delivering incentives are not carried out in a fair and consistent manner. While 23 respondents

neither agree nor disagree with the above statement.

19. Is the performance rating done periodically?

Yes

No

Interpretation:

According to the pie graph, 91% of the respondents agreed that the performance rating is done

periodically.

20. Do you agree that Performance-based pay motivates employee to improve/sustain

performance?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

Interpretation:

In the graph, it is clear that 65 of the respondents believe that the performance based pay

motivates the employees to improve their performance while 14 respondents did not believe that

the performance based pay will not motivate to improve the performance of the employee. The

remaining 21 respondents are showing neutral response regarding the performance based pay.

21. To what extent, the managers and subordinates have shared perception of purpose and

function of appraisal process?

To a very great extent

To a considerable extent

To some extent

To a very little extent

None of the above

Interpretation:

Among the 100 respondents, 15 respondents to a great extent, 19 respondents to a considerable

extent, 35 respondents to some extent, 18 respondents to a very little extent agree that the

managers and subordinates have shared perception of purpose and function of appraisal process.

The remaining 13 respondents did not agree with the above statement.

22. The performance appraisal process results in better communication between me and

my supervisor.

Do you agree with this statement?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

Interpretation:

According to the graph, 25 respondents agree and 17 respondents strongly agree that the

performance appraisal process will help in better communication with the supervisor and his

subordinates. 31 of the respondents neither agree nor disagree with the same. The remaining 27

respondents agree that the performance appraisal will not help to better communicate between

the supervisor and his subordinates.

23 . To what extent the appraisals are actually effective and accomplish goals?

To a very great extent

To a considerable extent

To some extent

To a very little extent

None of the above

Interpretation:

According to the graph, 31 respondents believe that appraisals are effective and accomplish goals

to some extent. 25 respondents believe to a very little extent, 16 respondents to a considerable

extent and 12 respondents to a very great extent. 16 respondents believe that the appraisals will

not be effective and accomplish goals.

24. Performance appraisal system helps to identify the strength and weakness of the

employee.

Do you agree with this statement?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

Interpretation:

Among the 100 respondents, majority of the respondents (70) feel that the appraisal system has

helped to identify the strength and weakness of the employee. 8 respondents believe that the

performance appraisal system did not help them to identify the strength and weakness of the

employees. While 22 respondents has shown neutral response on this.

25. Does the employee is rewarded for good performance?

Yes

No

Interpretation:

Majority of the respondents (77) feel that the employee is rewarded for good performance while

23% of them disagreed with the above statement.

26. In what way does your organization improve your performance?

Counseling

Training

Development programs

Interpretation:

According to the pie chart, the first method will be training as 45% of the respondents believe

that the training program will be helpful to improve their performance. Second method is

Development programs with 34% of the respondents and the third method is counseling with

21% to improve performance.

27. Performance appraisal is helpful in reducing the grievance among the employees?

Do you agree with this statement?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

Interpretation:

In the above graph, it is observed that 26 respondents strongly agree and 21 respondents agree

that the performance appraisal will help in reducing the criticism among the employees. While

15 respondents disagree and 8 respondents strongly disagree that the performance appraisal will

not help in reducing the criticism among the employees. 30 respondents neither agreed nor

disagreed regarding the same.

28. Mark the following needs which derived from system?

Training needs

Motivation

Counseling

Stress Management

Developments

Coaching

Leadership quality

Interpretation:

According to the graph, 22 respondents require motivation, 21 respondents require training

needs, 17 respondents require development, 12 respondents require counseling, 10 respondents

require stress management, 9 respondents require coaching and the remaining 9 respondents

require leadership quality to develop the appraisal system.

29. To what extent, the performance of an individual has been increased after appraisal?

To a very great extent

To a considerable extent

To some extent

To a very little extent

None of the above

Interpretation:

Among the 100 respondents, 34 respondents feel to some extent, 26 respondents to a

considerable extent, 17 respondents to a very great extent, 14 respondents to a very little extent

has increased the performance after appraisal. For the remaining 9 respondents none of the above

has influenced to increase the performance after appraisal.

30. How do you rate the performance appraisal system in your organization?

Excellent

Good

Satisfactory

Neither Good nor Bad

Poor

Interpretation:

By conducting the performance appraisal system in the current organization most of the

employees are benefitted and improved their performance. Among the 100 respondents 29

respondents feel that the appraisal system in the current organization is excellent, 35 respondents

feel good, 21 respondents feel satisfactory. 11 respondents neither feel good nor bad regarding

the performance appraisal system. Only 4 respondents feel it as poor among the remaining

respondents.

DATA ANALYSIS:

Sufficient in assessing goals * Overall agreement

Chi-Square Tests

Value dfAsymp. Sig. (2-sided)

Pearson Chi-Square 425.809a 64 .015

Likelihood Ratio 51.966 64 .860

Linear-by-Linear Association

43.700 1 .641

N of Valid Cases 105

a. 74 cells (91.4%) have expected count less than 5. The minimum expected count is .01.

View their Performance evaluation * Overall agreement

Chi-Square Tests

Value dfAsymp. Sig. (2-sided)

Pearson Chi-Square 425.809a 64 .024

Likelihood Ratio 51.966 64 .860

Linear-by-Linear Association 43.700 1 .347

N of Valid Cases 105

a. 74 cells (91.4%) have expected count less than 5. The minimum expected count is .01.

Documenting individual performance * Overall agreement

Chi-Square Tests

Value dfAsymp. Sig. (2-sided)

Pearson Chi-Square 328.000a 64 .641

Likelihood Ratio 55.052 64 .780

Linear-by-Linear Association

83.690 1 .854

N of Valid Cases 105

a. 73 cells (90.1%) have expected count less than 5. The minimum expected count is .01.

Incentives are fair and consistent * Overall agreement

Chi-Square Tests

Value dfAsymp. Sig. (2-sided)

Pearson Chi-Square 326.469a 56 .000

Likelihood Ratio 53.980 56 .552

Linear-by-Linear Association

86.332 1 .000

N of Valid Cases 105

a. 63 cells (87.5%) have expected count less than 5. The minimum expected count is .01.

Performance based pay motivation * Overall agreement

Chi-Square Tests

Value dfAsymp. Sig. (2-sided)

Pearson Chi-Square 387.444a 64 .047

Likelihood Ratio 66.836 64 .380

Linear-by-Linear Association

43.887 1 .368

N of Valid Cases 105

a. 73 cells (90.1%) have expected count less than 5. The minimum expected count is .01.

Shared perception of Purpose and function * Overall agreement

Chi-Square Tests

Value dfAsymp. Sig. (2-sided)

Pearson Chi-Square 431.138a 64 .544

Likelihood Ratio 56.145 64 .747

Linear-by-Linear Association

81.048 1 .615

N of Valid Cases 105

a. 73 cells (90.1%) have expected count less than 5. The minimum expected count is .01.

Better communication * Overall agreement

Chi-Square Tests

Value dfAsymp. Sig. (2-sided)

Pearson Chi-Square 428.123a 64 .658

Likelihood Ratio 54.449 64 .797

Linear-by-Linear Association

71.998 1 .841

N of Valid Cases 105

a. 72 cells (88.9%) have expected count less than 5. The minimum expected count is .01.

Identify strength and weakness * Overall agreement

Chi-Square Tests

Value dfAsymp. Sig. (2-sided)

Pearson Chi-Square 440.140a 72 .000

Likelihood Ratio 66.304 72 .667

Linear-by-Linear Association

83.313 1 .514

N of Valid Cases 105

a. 82 cells (91.1%) have expected count less than 5. The minimum expected count is .01.

Grievance reduction * Overall agreement

Chi-Square Tests

Value dfAsymp. Sig. (2-sided)

Pearson Chi-Square 604.689a 56 .032

Likelihood Ratio 231.531 56 .075

Linear-by-Linear Association

87.308 1 .647

N of Valid Cases 105

a. 61 cells (84.7%) have expected count less than 5. The minimum expected count is .01.

From the above chi-square analysis, it is found that the factors like Sufficient in assessing goals, View their Performance evaluation, Incentives are fair and consistent, Performance based pay motivation, Identify strength and weakness and Grievance reduction are showing significance value less than 0.05. That means these factors do not have significant association with the overall agreement of performance appraisal.

Other factors like documenting individual performance, Shared perception of Purpose and function and better communication do not have significance value greater than 0.05. That means these factors do not have significance association with the overall agreement on performance appraisal.

Hence alternative hypothesis is accepted. Therefore performance appraisal system is effective in an organization.

FINDINGS

1. Majority of the employees are associated with the organization above 2 years.

2. It has been found that 66 of the respondents are aware of the concept of Performance

Appraisal System

3. It is observed that (58%) of the respondents were informed about the Performance

Appraisal System during induction.

4. Among the respondents majority of them (59) agree that the performance appraisal

system is sufficient and also important in assessing goals and objectives in the

organization.

5. Above 40% of respondents feel that the performance appraisal system gives a proper

assessment of each employee and also sets to achieve the target given by the

organization.

6. Among the respondents, 40 respondents are awarded with the salary increment, 24

respondents of them with appreciation, 15 respondents with promotion and remaining

with others.

7. Above half of the superior’s put efforts to identify strengths and weaknesses of their

subordinates.

8. Among the respondents 31 respondents feel that the communication of appraisal should

communicate at data gathering stage, 25 respondents feel to have at goal setting stage, 24

respondents feel to have at midterm reviews and 20 respondents feel to have at annual

reviews.

9. For 29 respondents performance appraisal matches the expectation frequently, 23

respondents receive rarely, 20 respondents receive occasionally, 16 respondents reaches

every time and the remaining 12 respondents never reaches the target.

10. Above 40% of the Supervisor's give feedback to the employees regarding performance

appraisal and also allows them to view their performance evaluation

11. Among the respondents, 47 respondents feel that the standards should be changed, 31%

of the respondents feel that there should be change in the frequency of appraisal and 22%

of the respondents feel in the appraiser

12. Above 50% of the respondents feel that the organization is documenting individual

performance to support compensation and career planning decisions and to some extent

motivating employees after appraisal to develop and improve performance.

13. Except for 13% of the respondents performance is measured only with the review of past

performance.

14. Half of the respondents feel that the evaluation of performance and delivering incentives

are carried out in a fair and consistent manner.

15. 91% of the respondents feel that the rating on performance is done at regular intervals.

16. Among the 100 respondents 65 respondents agree that the performance based pay

motivates employee to improve/sustain performance.

17. 35 employees feel that to some extent the managers and subordinates have shared

perception of purpose and function of appraisal process.

18. 42 respondents have agreed that performance appraisal process results better

communication with the supervisor.

19. Among the 100 respondents, 16 respondents have no impact on appraisals to achieve

goals.

20. Only 8 respondents feel that performance appraisal system does not help to identify the

strength and weakness of the employee.

21. 77% of the employees are rewarded for the good performance.

22. For most of the organizations the first preference will be training, second will be

counseling and the third preference will be Development programs to improve

performance of the employees.

23. 23 respondents disagree that the performance appraisal will not be helpful for reducing

the grievance among the employees.

24. From the study it is found that the employees require training needs, motivation and

developments.

25. Most of the respondents has improved their performance and found satisfactory with the

performance appraisal system in the organization.

SUGGESTIONS

1. Few employees in the organization are not aware of performance appraisal system in the

organization and they are not informed regarding the same at the time of induction also.

The organization should take necessary action to inform the same.

2. Half of the respondents did not know the importance of the performance appraisal

system. The organization should inform the importance and effectiveness of the same by

conducting training session or meetings.

3. Further, some of the employees feel that proper assessment was not done in the

performance appraisal system when compared to the work they had contributed to the

organization. The organization should consider this factor seriously and had to increase

the performance appraisals. By doing this they are able to achieve the target set by the

organization.

4. The management should observe the superior’s attitude to find out whether they are able

to help to overcome the weaknesses, as few of the employees pointed that their superiors

are unable to identify the strengths and weakness in them.

5. Half of the employees feel that the organizations are not calculating the individual

performance to support compensation and career planning decisions. The organization

should focus on this to achieve better performance from the employees.

6. Employees feel that the organization is not motivating them after appraisal in order to

develop and improve performance. The organization should check the employee

performance after appraisal also.

CONCLUSION

The study on effectiveness of appraisal system was undertaken to get knowledge of the appraisal

system of the organization. It was also done to find out the level of awareness among the

employees about the performance appraisal system adopted in the organization and the steps

involved in the appraisal system. It was done to throw light on the employee perception of the

existing appraisal system.

The study is done at Hyderabad in a single organization with the employees as the respondents of

the study. The sampling technique used was convenience sampling. The entire study is based on

the hypothesis that there is no significant relationship between the performance appraisal and

improvement in the performance of the employee. The study also had limitations like time which

were taken care of.

The data collected from the primary source and the secondary sources was analyzed using

appropriate statistical tools like chi-square test, graphs, tables etc. From the study, it was found

that the existing appraisal system in the organization is effective and it helps in improving the

employee performances. It was also found that considerable number of employees opines that

their appraisal system does not proper assess an employee.

The organization should therefore properly assess the employee regularly. Based on this, they

should be trained and encouraged to perform well. Further, the improvement should be properly

rewarded. A part from this, the employees should be given clear information of the company’s

appraisal system and the methods and policies followed in the organization.

BIBLIOGRAPHY

Pawan S Budhwar, Arup Varma, Angelo S DeNisi, Performance Management Systems,

Published by Taylor & Francis in 2008.

Kevin R. Murphy, Jeanette Cleveland, Understanding Performance Appraisal, Published by

SAGE in 1995.

John M Ivancevich, Human Resource Management 10E, published by Tata McGraw-Hill

Education in 2008.

Websites:

www.wikipedia.org

www.performance-appraisal.com

www.performance.gov.in

www.appraisals.naukrihub.com

www.humanresources.about.com

ANNEXURE-1

QUESTIONNAIRE

Demographics:

i) Age:____________

a. 15-25yrs b. 25-35yrs c. 35-45yrs d. Above 45yrs

ii) Gender____________________

a. Male b. Female

iii) Residence___________________

iv) Qualification__________

a. Undergraduate b. Graduate c. Post Graduate d. Others

v) Designation____________

vi) Experience in the current organization:

a. Less than 1yr b. 1-2yrs c. 2-5yrs d. 5-10yrs e.Above 10yrs

vii) Annual income (in lakhs)______________

a. Below 1 b. 1-2 c. 2-3

d. 3-5 e. 5-8 f. Above 8

1. How long have you working in the present organization?

Less than 1yr

1-2yrs

2-5yrs

5-10yrs

Above 10yrs

2. Are you aware of Performance Appraisal System in the Organization?

Yes

No

3. Were you informed about the Performance Appraisal model, used in the Organization, during

your induction?

Yes

No

4. “The performance appraisal system is sufficient in assessing goals and objectives of the

Organization.” Do you agree with this statement?

Strongly agree

Agree

Neither agree nor disagree

Disagree

Strongly disagree

5. How important is the Performance Appraisal to improve your Performance, according to you?

Most important

Important

Not important

Not at all important

6. In your opinion, does the Performance Appraisal System give a proper assessment of your

contribution to the organization?

Yes

To some extent

No

7. Are you able to achieve your target set by the Performance Appraisal System?

Yes

To some extent

No

8. Which kind of reward did you get from the superior for your performance?

Salary increment

Appreciation

Promotion

Bonus payment

Others

9. What is your satisfaction level with your superior’s efforts to identify your strengths and

weaknesses?

Highly satisfied

Satisfied

Neither satisfied nor dissatisfied

Not satisfied

Highly dissatisfied

10. In which stage do you think that appraisal should communicate with employees with regard

to Performance Appraisal System?

Goal-setting stage

Data-gathering stage

Mid-term reviews

Annual reviews

11. According to you, how often does performance appraisal match to your expectation?

Every time

Often

Sometimes

Rarely

Never

12. To what extent, supervisor gives feedback to the employees regarding performance

appraisal?

To a very great extent

To a considerable extent

To some extent

To a very little extent

None of the above

13. Do you agree that the superior allow employees to view their performance evaluation?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

14. What are the areas that should be improved upon?

Standards

Frequency of appraisal

Appraiser

15. Do you agree that organization is documenting individual performance to support

compensation and career planning decisions?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

16. To what extent, the organization motivate employees after appraisal to develop and improve

performance?

To a very great extent

To a considerable extent

To some extent

To a very little extent

None of the above

17. Is your performance is only measured with the review of past performance?

Yes

No

18. Evaluating performance and delivering incentives are carried out in a fair and consistent

manner.

Do you agree with this statement?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

19. Does the performance rating was done periodically?

Yes

No

20. Do you agree that Performance-based pay motivates employee to improve/sustain

performance?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

21. To what extent, the managers and subordinates have shared perception of purpose and

function of appraisal process?

To a very great extent

To a considerable extent

To some extent

To a very little extent

None of the above

22. The performance appraisal process results in better communication between me and my

supervisor.

Do you agree with this statement?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

23 . To what extent the appraisals are actually effective and accomplish goals?

To a very great extent

To a considerable extent

To some extent

To a very little extent

None of the above

24. Performance appraisal system helps to identify the strength and weakness of the employee?

Do you agree with this statement?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

25. Does the employee is rewarded for good performance?

Yes

No

26. In what way does your organization improve your performance?

Counseling

Training

Development programs

27. Performance appraisal is helpful in reducing the grievance among the employees?

Do you agree with this statement?

Strongly agree

Agree

Neutral

Disagree

Strongly disagree

28. Mark the following needs which derived from system?

Training needs

Motivation

Counseling

Stress Management

Developments

Coaching

Leadership quality

29. To what extent, the performance of an individual has been increased after appraisal?

To a very great extent

To a considerable extent

To some extent

To a very little extent

None of the above

30. How do you rate the performance appraisal system in your organization?

Excellent

Good

Satisfactory

Neither Good nor Bad

Poor

Any suggestions…………

______________________________________________________________________________

______________________________________________________________________________