My Project Final New.1

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INTRODUCTION

Human Resource Management:

The Human Resources Management (HRM) function includes a

variety of activities, and key among them is deciding what staffing needs

you have and whether to use independent contractors or hire employees

to fill these needs, recruiting and training the best employees, ensuring

they are high performers, dealing with performance issues, and ensuring

your personnel and management practices conform to various regulations.

Activities also include managing your approach to employee benefits and

compensation, employee records and personnel policies. Usually small

businesses (for-profit or nonprofit) have to carry out these activities

themselves because they can't yet afford part- or full-time help. However,

they should always ensure that employees have -- and are aware of --

personnel policies which conform to current regulations. These policiesare often in the form of employee manuals, which all employees have.

Note that some people distinguish a difference between HRM (a

major management activity) and HRD (Human Resource Development, a

profession). Those people might include HRM in HRD, explaining that

HRD includes the broader range of activities to develop personnel inside

of organizations, e.g., career development, training, organization

development, etc.

There is a long-standing argument about where HR-related

functions should be organized into large organizations, eg, "should HR be

in the Organization Development department or the other way around?"

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The HRM function and HRD profession have undergone

tremendous change over the past 20-30 years. Many years ago, large

organizations looked to the "Personnel Department," mostly to manage

the paperwork around hiring and paying people. More recently,

organizations consider the "HR Department" as playing a major role in

staffing, training and helping to manage people so that people and the

organization are performing at maximum capability in a highly fulfilling

manner.

Recently, the phrase "talent management" is being used to refer the

activities to attract, develop and retain employees. Some people and

organizations use the phrase to refer especially to talented and/or high-

potential employees. The phrase often is used interchangeably with the

field of Human Resource Management -- although as the field of talent

management matures, it's very likely there will be an increasing number

of people who will strongly disagree about the interchange of these fields.

For now, this Library uses the phrases interchangeably.

Performance Appraisal:

Simply put, it is the observation and evaluation of a school

employee’s work behavior and accomplishments for the purpose of

making decisions about the staff member. These decisions may include

wage, salary, and benefit determinations; promotion, demotion, transfer,

or termination actions; and coaching and counseling, training, or career

development options.

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There are three basic functions of an effective performance appraisal:

1. To provide adequate feedback to staff members on their performance

2. To serve as an opportunity to communicate face-to-face modifications

or changes to existing performance objectives

3. To provide data to administrators so they can evaluate a staff member

and judge future job assignments and compensation

The notion of performance appraisal has become an almost

universally accepted fact of life in most organizations. It often serves as

the basis for other human resource systems, such as salary management,

career development, and selection processes. Because of all of these uses

for the performance appraisal process, it is increasingly important that

school leaders more than ever need to improve their managerial andsupervisory skills in such areas as creating individual performance

standards, getting employee commitment to performance standards, and

conducting interim and end-of-year performance appraisal meetings.

Finally, the report is rounded up by presenting a case study

The report is made useful for readers by incorporating Suggestions andRecommendations for all concerned on how to make a grand success of

appraisal system followed by their organizations.

Few blank formats of different appraisal methods and processes

have been included as in the report to show how today’s successful

organizations are trying to assess and evaluate their employee

performance.

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NEED OF THE STUDY

• This project has been undertaken to share my experiences on

Performance appraisal system as well as to enhance my

understanding of this fascinating subject by doing some study &

research in Coca-Cola company.

• The project explains the meaning of Performance Appraisal,

different methods used to evaluate the performance of employees

located in Coca-Cola company, its effective implementation and

the benefits of the system.

• It also aims at understanding the problems associated with

performance appraisal and suggests measures to be adopted to

overcome these issues at the company.

• Overall objective of the project is to understand the effectiveness

of performance appraisal system on Coca-Cola beverages ltd.

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SCOPE OF THE PROJECT

This project report covers the definition and meaning of

Performance Appraisal. It elucidates the benefits and drawbacks of the

traditional methods as well as recent advances in the field of performance

appraisal.

The project throws light on the concern areas for different people

involved in the appraisal process and attempts to find out ways to

overcome those problems.

Few formats of the performance appraisal forms have been

included in the project to show the way different companies are

evaluating the performance of their employees.

Thus, through this project report one can:

have a reasonable understanding of the term performance

appraisal;

understand what needs to be done for its effective implementation;

know the key areas of performance indicators;

understand the benefits of the system;

know how it helps in designing the Performance Rated Pay system;

know how it helps in planning of career of employees;

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METHODOLOGY

The study of the topic “ Performance Appraisal” has been done through

various sources.

The Primary source includes the personal experience, which has

been added in this project as the `Sample of Current Practice-Case Study’

The Secondary sources include:

• Information gathered through surfing the internet;

• Information available on intranet site on knowledge management;

• Different study materials;

• Private circulations from consultants;

• Deliberations with practicing consultants and experts in the field;

• Sample performance appraisal forms obtained from reliable

resources.

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LIMITATIONS

The present study is conducted through personal interview with

questionnaire.

This survey is conducted within limited time period 7days.

In the personal interviews can include personal bias between the

respondent and me.

This survey is conducted for only limited members that is 30.

The project duration is too limited to 2 months only.

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A BRIEF INSIGHT – THE BEVERAGE INDUSTRIES IN

INDIA

In India, beverages form an important part of the lives of people. It

is an industry, in which the players constantly innovate, in order to come

up with better products to gain more consumers and satisfy the existing

consumers.

(FIGURE 1: BEVERAGE INDUSTRY IN INDIA)

The beverage industry is vast and there various ways of segmenting it,

so as to cater the right product to the right person. The different ways of

segmenting it are as follows:

• Alcoholic, non-alcoholic and sports beverages

• Natural and Synthetic beverages

• In-home consumption and out of home on premises consumption.

• Age wise segmentation i.e. beverages for kids, for adults and for

senior citizens

• Segmentation based on the amount of consumption i.e. high levels

of consumption and low levels of consumption.

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BEVERAGES

Alcoholic Non-Alcoholic

Carbonated Non-Carbonated

Cola Non-Cola Non-Cola



If the behavioral patterns of consumers in India are closely noticed,

it could be observed that consumers perceive beverages in two different

ways i.e. beverages are a luxury and that beverages have to be consumed

occasionally. These two perceptions are the biggest challenges faced by

the beverage industry. In order to leverage the beverage industry, it is

important to address this issue so as to encourage regular consumption as

well as and to make the industry more affordable.

Four strong strategic elements to increase consumption of the

products of the beverage industry in India are:

• The quality and the consistency of beverages needs to be enhanced

so that consumers are satisfied and they enjoy consuming

beverages.

• The credibility and trust needs to be built so that there is a very

strong and safe feeling that the consumers have while consuming

the beverages.

• Consumer education is a must to bring out benefits of beverage

consumption whether in terms of health, taste, relaxation,

stimulation, refreshment, well-being or prestige relevant to the

category.

• Communication should be relevant and trendy so that consumers

are able to find an appeal to go out, purchase and consume.

The beverage market has still to achieve greater penetration and

also a wider spread of distribution. It is important to look at the entire

beverage market, as a big opportunity, for brand and sales growth in

turn to add up to the overall growth of the food and beverage industry

in the economy.

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COCA - COLA INTERNATIONAL

History:History:

Coca-Cola Enterprises, established in 1986, is a young

company by the standards of the Coca-Cola system. Yet each of

its franchises has a strong heritage in the traditions of Coca-Cola

that is the foundation for this Company.

The Coca-Cola Company traces it’s beginning to 1886,

when an Atlanta pharmacist, Dr. John Pemberton, began to

produce Coca-Cola syrup for sale in fountain drinks. However

the bottling business began in 1899 when two Chattanooga

businessmen, Benjamin F. Thomas and Joseph B. Whitehead,

secured the exclusive rights to bottle and sell Coca-Cola for most

of the United States from The Coca-Cola Company.

The Coca-Cola bottling system continued to operate as

independent, local businesses until the early 1980s when bottling

franchises began to consolidate. In 1986, The Coca-Cola

Company merged some of its company-owned operations with

two large ownership groups that were for sale, the John T.

Lupton franchises and BCI Holding Corporation's bottling

holdings, to form Coca-Cola Enterprises Inc. The Company

offered its stock to the public on November 21, 1986, at a split-

adjusted price of $5.50 a share. On an annual basis, total unit

case sales were 880,000 in 1986.

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In December 1991, a merger between Coca-Cola

Enterprises and the Johnston Coca-Cola Bottling Group, Inc.

(Johnston) created a larger, stronger Company, again helping

accelerate bottler consolidation. As part of the merger, the senior

management team of Johnston assumed responsibility for

managing the Company, and began a dramatic, successful

restructuring in 1992.Unit case sales had climbed to 1.4 billion,

and total revenues were $5 billion.

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http://en.wikipedia.org/wiki/File:Coca-ColaHQ.jpg

http://en.wikipedia.org/wiki/File:The_Coca-Cola_Company_logo.svg



Type Public ( NYSE: KO)

Founded 1892 by Asa Griggs Candler

Headquarters Atlanta, Georgia, United StatesArea served Worldwide

Key peopleE. Neville Isdell (Chairman)

Muhtar Kent (Chairman-elect, CEO)[1]

Industry Beverage

Products

Coca-ColaCarbonated soft drinks

Water Other Non-alcoholic beverages

Market cap USD 141.463 Billion (2008)

Revenue ▲ USD 28.857 Billion (2007 ) [1]

Operating

income▲ USD 7.252 Billion (2007 ) [2]

Net income ▲ USD 5.981 Billion (2007 ) [3]

Total assets ▲ USD 43,103 MILLIONS (2009 APRIL )

Total equity ▲ USD 21,108 MILLIONS (2009 APRIL)

Employees 90,500 (2008)

Website www.TheCoca-ColaCompany.com

MANIFESTO FOR GROWTH

VALUES :

Coca-Cola is guided by shared values that both the employees as

individuals and the Company will live by; the values being:

• LEADERSHIP: The courage to shape a better future

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http://en.wikipedia.org/wiki/Category:Types_of_companies

http://en.wikipedia.org/wiki/Public_company

http://en.wikipedia.org/wiki/New_York_Stock_Exchange

http://www.nyse.com/about/listed/ko.html

http://en.wikipedia.org/wiki/Asa_Griggs_Candler

http://en.wikipedia.org/wiki/Atlanta,_Georgia

http://en.wikipedia.org/wiki/United_States

http://en.wikipedia.org/wiki/E._Neville_Isdell

http://en.wikipedia.org/wiki/Chairman

http://en.wikipedia.org/wiki/Muhtar_Kent


http://en.wikipedia.org/wiki/CEO

http://en.wikipedia.org/wiki/The_Coca-Cola_Company#cite_note-0%23cite_note-0

http://en.wikipedia.org/wiki/Industry

http://en.wikipedia.org/wiki/Beverage

http://en.wikipedia.org/wiki/Product_(business)

http://en.wikipedia.org/wiki/Coca-Cola

http://en.wikipedia.org/wiki/Carbonation

http://en.wikipedia.org/wiki/Soft_drink

http://en.wikipedia.org/wiki/Water

http://en.wikipedia.org/wiki/Non-alcoholic_beverage

http://en.wikipedia.org/wiki/Market_capitalization

http://en.wikipedia.org/wiki/United_States_dollar

http://en.wikipedia.org/wiki/Revenue


http://www.thecoca-colacompany.com/presscenter/pdfs/ko_earnings20080213.pdf

http://en.wikipedia.org/wiki/Earnings_before_interest_and_taxes




http://en.wikipedia.org/wiki/Net_income



http://en.wikipedia.org/wiki/Assets


http://en.wikipedia.org/wiki/Ownership_equity


http://en.wikipedia.org/wiki/Employment

http://en.wikipedia.org/wiki/Website

http://www.thecoca-colacompany.com/

http://en.wikipedia.org/wiki/Category:Types_of_companies

http://en.wikipedia.org/wiki/Public_company

http://en.wikipedia.org/wiki/New_York_Stock_Exchange

http://www.nyse.com/about/listed/ko.html

http://en.wikipedia.org/wiki/Asa_Griggs_Candler

http://en.wikipedia.org/wiki/Atlanta,_Georgia

http://en.wikipedia.org/wiki/United_States

http://en.wikipedia.org/wiki/E._Neville_Isdell


http://en.wikipedia.org/wiki/Muhtar_Kent


http://en.wikipedia.org/wiki/CEO

http://en.wikipedia.org/wiki/The_Coca-Cola_Company#cite_note-0%23cite_note-0

http://en.wikipedia.org/wiki/Industry

http://en.wikipedia.org/wiki/Beverage

http://en.wikipedia.org/wiki/Product_(business)

http://en.wikipedia.org/wiki/Coca-Cola

http://en.wikipedia.org/wiki/Carbonation

http://en.wikipedia.org/wiki/Soft_drink

http://en.wikipedia.org/wiki/Water

http://en.wikipedia.org/wiki/Non-alcoholic_beverage

http://en.wikipedia.org/wiki/Market_capitalization


http://en.wikipedia.org/wiki/Revenue







http://en.wikipedia.org/wiki/Net_income



http://en.wikipedia.org/wiki/Assets


http://en.wikipedia.org/wiki/Ownership_equity


http://en.wikipedia.org/wiki/Employment

http://en.wikipedia.org/wiki/Website

http://www.thecoca-colacompany.com/



• PASSION: Committed in heart and mind

• INTEGRITY: Be real

• ACCOUNTABILITY: If it is to be, it’s up to me

• COLLABORATION: Leverage collective genius

• INNOVATION: Seek, imagine, create, delight

• QUALITY: What we do, we do well

VISION FOR SUSTAINABLE GROWTH

• PROFIT: Maximizing return to shareowners while being mindful

of our overall responsibilities.

• PEOPLE: Being a great place to work where people are inspired

to be the best they can be.

• PORTFOLIO: Bringing to the world a portfolio of beverage

brands that anticipate and satisfy peoples’ Desires and needs.

• PARTNERS: Nurturing a winning network of partners and

building mutual loyalty.

• PLANET: Being a responsible global citizen that makes a

difference.

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(FIGURE 2: VISION FOR SUSTAINABLE GROWTH)

MISSION

To create consumer products, services and communications, customer

service and bottling system strategies, processes and tools in order to

create competitive advantage and deliver superior value to;

• Consumers as a superior beverage experience

• Consumers as an opportunity to grow profits through the use of

finished drinks

• Bottlers as an opportunity to grow profits in volumes

• Bottlers as a trademark enhancement and positive economic value

added

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• Suppliers as an opportunity to make reasonable profits when

creating real value-added in an environment of system-wide team

work, flexible business system and continuous improvement

• Indian society in the form of a contribution to economic and social

development.

• To Refresh the World... In body, mind, and spirit

• To Inspire Moments of Optimism... Through our brands and our

actions

• To Create Value and Make a Difference... Everywhere we engage.

QUALITY POLICY

“To ensure customer delight, we commit to quality in our thoughts,

deeds and actions by continually improving our processes…Every time.”

OBJECTIVES/GOALS

Coca-Cola main objectives are to supply everyone their favourite

drink and to satisfy the consumer needs and wants. Coca-Cola second

main objectives are to provide profit to the shareholders and increase the

market share.

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YEAR WISE HISTORY OF BOTTLING

Year 1894: A modest start for a bold idea:

In a candy store in Vicksburg, Mississippi, brisk sales of the new

fountain beverage called Coca-Cola impressed the store's owner, Joseph

A. Biedenharn. He began bottling Coca-Cola to sell, using a common

glass bottle called a Hutchinson. Biedenharn sent a case to Asa Griggs

Candler, who owned the Company. Candler thanked him but took no

action. One of his nephews already had urged that Coca-Cola be bottled,

but Candler focused on fountain sales.

Year 1899: The first bottling agreement:

Two young attorneys from Chattanooga, Tennessee believed they

could build a business around bottling Coca-Cola. In a meeting with

Candler, Benjamin F. Thomas and Joseph B. Whitehead obtained

exclusive rights to bottle Coca-Cola across most of the United States for a

sum of one dollar. A third Chattanooga lawyer, John T. Lupton, soon

joined their ventur

Years 1900-1909: Rapid growth:

The three pioneer bottlers divided the country into territories andsold bottling rights to local entrepreneurs. Their efforts were boosted by

major progress in bottling technology, which improved efficiency and

product quality. By 1909, nearly 400 Coca-Cola bottling plants were

operating, most of them family-owned businesses. Some were open only

during hot-weather months when demand was high

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Year 1916: Birth of the Contour Bottle:

Bottlers worried that Coca-Cola's straight-sided bottle was easily

confused with imitators. A group representing the Company and bottlers

asked glass manufacturers to offer ideas for a distinctive bottle. A design

from the Root Glass Company of Terre Haute, Indiana won enthusiastic

approval. The Contour Bottle became one of the few packages ever

granted trademark status by the U.S. Patent Office. Today, it is one of the

most recognized icons in the world.

In the 1920s: Bottling overtakes fountain sales:

As the 1920s dawned; more than 1,000 Coca-Cola bottlers were

operating in the U.S. Their ideas and zeal fueled steady growth. Six-

bottle cartons were a huge hit starting in 1923. A few years later, open-

top metal coolers became the forerunners of automated vendingmachines. By the end of the 1920s, bottle sales of Coca-Cola exceeded

fountain sales

In the 1920s and 1930s: International expansion:

Led by Robert W. Woodruff, chief executive officer and chairmanof the Board, the Company began a major push to establish bottling

operations outside the U.S. Plants were opened in France, Guatemala,

Honduras, Mexico, Belgium, Italy and South Africa. By the time World

War II began, Coca-Cola was being bottled in 44 countries.

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In the 1940s: Post-war growth:

During the war, 64 bottling plants were set up around the world to

supply the troops. This followed an urgent request for bottling equipment

and materials from General Eisenhower's base in North Africa. Many of

these war-time plants were later converted to civilian use, permanently

enlarging the bottling system and accelerating the growth of the

Company's worldwide business.

In the 1950s: Packaging innovations:

For the first time, consumers had choices of Coca-Cola package

size and type-the traditional 6.5 ounce Contour Bottle, or larger servings

including 10, 12 and 26 ounce versions. Cans were also introduced,

becoming generally available in 1960.

In the 1960s: Introduction of new brands:

Sprite, Fanta, Fresca and TAB joined brand Coca-Cola in the

1960s. Mr. Pibb and Mello Yello were added in the 1970s. The 1980s

brought diet Coke and Cherry Coke, followed by PowerAde and

Fruitopia in the 1990s. Today scores of other brands are offered to meet

consumer preferences in local markets around the world.

In the 1970s and 1980s: Consolidation to serve customers:

Advancement in technology led to global economy, retail

customers of The Coca-Cola Company merged and evolved into

international mega chains. Such customers required a new approach. In

response, many small and medium-size bottlers consolidated to better

serve giant international customers. The Company encouraged and

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invested in a number of bottler consolidations to assure that its largest

bottling partners would have capacity to lead the system in working with

global retailers.

In the 1990s: New and growing markets:

Political and economic changes opened vast markets that were

closed or underdeveloped for decades. After the fall of the Berlin Wall,

the Company invested heavily to build plants in Eastern Europe. As the

century closed, more than $1.5 billion was committed to new bottling

facilities in Africa.

21st Century: Coca-Cola today:

The Coca-Cola bottling system grew up with roots deeply planted

in local communities. This heritage serves the Company well today as

consumers seek brands that honor local identity and the distinctiveness of

local markets. As was true a century ago, strong locally based

relationships between Coca-Cola bottlers, customers and communities are

the foundation on which the entire business grows.

The per capita consumption of company beverage products (not

just Coca-Cola) in 2009: Mexico comes in number one with a staggering

665 (8 fluid ounces) servings, followed by Malta with 598, Chile 426,

U.S.399 and Australia 332.

Interestingly, the number one sparkling (carbonated) soft drink in

China is Sprite; and in India is Thums Up (acquired by Coca-Cola in

1993), followed by Sprite. Even in Japan, Coca-Cola’s Georgia Coffee is

the number one soft drink. As consumer tastes vary from country to

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country, it is nearly impossible to have the same beverage top the

rankings in every market, but having the right portfolio strategy can still

put the company in the leadership position.

Globally, Coca-Cola has achieved No. 1 global ranking for

Sparkling Beverages, Juices and Juice Drinks, Ready-to-Drink Coffees

and Teas. The company is No.2 in Sports Drinks, No.3 in Packaged

Water, and Energy Drinks. Coca-Cola is working hard to achieve No. 1 in

all these NARTD (Non-Alcoholic Ready-To-Drink) beverage categories.

Another interesting tidbit is that Nestea is not mentioned at all in

the 2009 Annual Review. In the 2008 Annual Review, Nestea is listed as

one of Coca-Cola’s 13 billion dollar brands. Nestea trademark belongs to

Nestle and the beverage is being marketed and distributed throughout the

Coca-Cola system, and Beverage Partners Worldwide, a joint-venture

between Coca-Cola and Nestle.

In the 2009 report, Simply was the latest Coca-Cola brand to break

the one-billion dollar revenue in a year and was added to the list of

Billion Dollar Brands.

Looking at The Coca-Cola Company website, the corporate pressrelease dated February 11, 2010, was the first time that Simply brand was

added to the list of billion dollar brands and the total became 14. The

press release dated March 26, 2010, still listed 14 billion dollar brands,

but the press release dated March 29, 2010, the list became 13 billion

dollar brands.

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http://www.thecoca-colacompany.com/presscenter/presskit_sprite_spark_press_release.html

http://www.thecoca-colacompany.com/presscenter/nr_20100326_fifa_trophy_tour_houston.html

http://www.thecoca-colacompany.com/presscenter/nr_20100329_north_america_integration.html

http://www.thecoca-colacompany.com/presscenter/presskit_sprite_spark_press_release.html

http://www.thecoca-colacompany.com/presscenter/nr_20100326_fifa_trophy_tour_houston.html

http://www.thecoca-colacompany.com/presscenter/nr_20100329_north_america_integration.html



So why did Coca-Cola exclude Nestea from its billion dollar brands list?

Coca-Cola Nestle partnership started two decades ago in 1991 with

Coca-Cola Nestle Refreshments to market read-to-drink coffee and tea.

Then in 2001, the partnership was renewed as Beverage Partner

Worldwide, but in late 2006, the scope of products was reduced to just

ready-to-drink tea.

For coffee, Coca-Cola turned from the Swiss to the Italians by

signing a global partnership with illycaffè SpA to develop and market

ready-to-drink coffee under the illy issimo brand in late 2007 with final

agreement inked in March 2008.

In February 2008, Coca-Cola took a 40% stake in Honest Tea with

the rights to acquire the company after 3 years.

Personally, CEO of coca-cola enjoy Honest Tea more than Nestea.

Although CEO also like Gold Peak which was developed and marketed

by Beverage Partners Worldwide, it is very hard to find Gold Peak in

stores. Coca-Cola is expected to acquire 100% of Honest Tea in 2011 and

perhaps expand this popular brand.

Another brand that CEO have seen brewing in the Coca-Cola tea

portfolio is Fuze. Already CEO have seen Fuze brand freshly brewed tea

dispensers in Subway restaurants. Fuze is also a recent acquisition by

The Coca-Cola Company from 3 years ago.

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CEO don't know why Nestea got dropped from the list, but I am

not going to miss Nestea if it disappears from the shelves or vending

machines in the U.S. as it has in Japan a few years ago.

SWOT Analysis of Coca-Cola:

SWOT stands for Strengths Weakness Opportunities Threats.

SWOT analysis is a technique much used in many general management

as well as marketing scenarios. SWOT consists of examining the current

activities of the organization- its Strengths and Weakness- and then using

this and external research data to set out the Opportunities and Threats

that exist.

Strengths:

Coca-Cola has been a complex part of world culture for a very longtime. The product's image is loaded with over-romanticizing, and this is

an image many people have taken deeply to heart. The Coca-Cola image

is displayed on T-shirts, hats, and collectible memorabilia. This

extremely recognizable branding is one of Coca-Cola's greatest strengths.

"Enjoyed more than 685 million times a day around the world Coca-Cola

stands as a simple, yet powerful symbol of quality and enjoyment”(Allen, 1995).

Additionally, Coca-Cola's bottling system is one of their greatest

strengths. It allows them to conduct business on a global scale while at

the same time maintain a local approach. The bottling companies are

locally owned and operated by independent business people who are

authorized to sell products of the Coca-Cola Company. Because Coke

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does not have outright ownership of its bottling network, its main source

of revenue is the sale of concentrate to its

bottlers.

Weaknesses:

Weaknesses for any business need to be both minimised and

monitored in order to effectively achieve productivity and efficiency in

their business’s activities, Coke is no exception. Although domestic

business as well as many international markets are thriving (volumes in

Latin America were up 12%), Coca-Cola has recently reported some

"declines in unit case volumes in Indonesia and Thailand due to reduced

consumer purchasing power." According to an article in Fortune

magazine, "In Japan, unit case sales fell 3% in the second quarter [of

1998]...scary because while Japan generates around 5% of worldwide

volume, it contributes three times as much to profits. Latin America,Southeast Asia, and Japan account for about 35% of Coke's volume and

none of these markets are performing to expectation.

Coca-Cola on the other side has effects on the teeth which is an

issue for health care. It also has got sugar by which continuous drinking

of Coca-Cola may cause health problems. Being addicted to Coca-Cola

also is a health problem, because drinking of Coca-Cola daily has an

effect on your body after few years.

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Opportunities:

Brand recognition is the significant factor affecting Coke's

competitive position. Coca-Cola's brand name is known well throughout

94% of the world today. The primary concern over the past few years has

been to get this name brand to be even better known. Packaging changes

have also affected sales and industry positioning, but in general, the

public has tended not to be affected by new products. Coca-Cola's

bottling system also allows the company to take advantage of infinite

growth opportunities around the world. This strategy gives Coke the

opportunity to service a large geographic, diverse area.

Threats:

Currently, the threat of new viable competitors in the carbonated

soft drink industry is not very substantial. The threat of substitutes,

however, is a very real threat. The soft drink industry is very strong, but

consumers are not necessarily married to it. Possible substitutes that

continuously put pressure on both Pepsi and Coke include tea, coffee,

juices, milk, and hot chocolate. Even though Coca-Cola and Pepsi control

nearly 40% of the entire beverage market, the changing health-

consciousness of the market could have a serious affect. Of course, both

Coke and Pepsi have already diversified into these markets, allowing

them to have further significant market shares and offset any losses

incurred due to fluctuations in the market. Consumer buying power also

represents a key threat in the industry. The rivalry between Pepsi and

Coke has produce a very slow moving industry in which management

must continuously respond to the changing attitudes and demands of their

consumers or face losing market share to the competition. Furthermore,

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consumers can easily switch to other beverages with little cost or

consequence.

Product Life Cycle:

When referring to each and every product or service ever placed

before the consumer i.e. in the long term all the existing products and

services are dead. For e.g.:- Replacement of Ford Cortina ( a highly

successful car) by Ford Sierra, the replacement of sierra by the Ford

Mondeo and the replacement of the old Mondeo by the new Mondeo in

2001. So every product is born, grows, matures and dies. So in thecommercial market place products and services are created, launched and

withdrawn in a process known as Product Life Cycle.

To be able to market its product properly, a business must be aware of the

product life cycle of its product. The standard product life cycle tends to

have five phases: Development, Introduction, Growth, Maturity and

Decline. Coca-Cola is currently in the maturity stage, which is evidenced primarily by the fact that they have a large, loyal group of stable

customers.

Furthermore, cost management, product differentiation and marketing

have become more important as growth slows and market share becomes

the key determinant of profitability. In foreign markets the product life

cycle is in more of a growth trend Coke's advantage in this area is mainly

due to its establishment strong branding and it is now able to use this area

of stable profitability to subsidize the domestic cola wars.

All objectives should be SMART i.e. Specific, Measurable,

Achievable, Realistic, and Timed.

25



Selecting Target Market

Once the situation analysis is complete, and the marketing

objectives determined, attention turns to the target market. The soft drink

market is very large, and the business cannot be “all things to all people”,

so it must choose which market segments have the greatest potential. The

target market is the group of customers on whom the business focuses

attention. The target market is where Coca Cola focuses its marketing

efforts as it feels this is where it will be most productive and successful.

The target market for Coca cola is very wide as it satisfy’s the needs for

many different consumers, ranging from the healthy diet consciousness

through Diet Coke to the average human through its best selling drink

regular Coke. Most Coke products satisfy all age groups as it is proven

that most people of different age groups consume the Coca Cola product.

This market is relatively large and is open to both genders, thereby

allowing greater product diversification.

There are four broad ways which Coca Cola can segment its market:

→ Mass marketing

→ Concentrated marketing

→ Differentiated marketing

→ Niche marketing

The most apparent method used by Coca Cola is with no doubt the

differentiated marketing method as Coke satisfy’s a range of different

markets. Diet coke satisfy’s the weight consciousness, regular coke,

sprite, fanta the average human, coffee, iced tea etc. Each group of

beverages satisfy a particular group of people.

26



2020 vision:

We have also begun rolling out our 2020 Vision, the roadmap for

winning together with our worldwide bottling partners. Our 2020 Visionroadmap is bringing new clarity and focus to our global business and is

ensuring that our system is ideally positioned to make the most of the

abundant opportunities ahead of us. We believe our unique global

franchise model is the best way to win in the market, while providing

sustainable profitable growth for our customers and shareowners. Our

priorities remain centered on superior execution to drive value for today

while strategically investing in growth for tomorrow. Over the next

decade, we expect to see a global economy inevitably strengthened by

attractive demographic shifts, rapid urbanization, renewed entrepreneurial

energy and improved consumer sentiment. These trends bode well for the

future of The Coca-Cola Company and our system.”

♠ The Global Economic Recession Threatens Overall

Demand:

In 2008 and 2009, the global economy has fallen into a recession.

Not just the United States but countries from all over the world have felt

the impacts of the 2008 Financial Crisis. This may be a problem for

Coke, which derives approximately 75% of its sales from outside North

America. Still, the company has positioned itself well in international

markets both organically and through acquisitions, such as that of

Chinese juice maker Huiyuan for $2.4 billion. However the company was

unsuccessful with its purchase of Huiyuan as it broke anti trust laws in

China. On March 5, 2010, Coke's CEO said that emerging markets are

bouncing back quicker than more developed markets.

27

http://www.wikinvest.com/wiki/2008_Financial_Crisis

http://www.wikinvest.com/stock/Coca-Cola_Company_(KO)?action=edit&section=8

http://www.wikinvest.com/wiki/2008_Financial_Crisis



“ PERFORMANCE APPRAISAL”

I. Background :

1. The concept of Performance Appraisal dates back to the First

World War and was then called “Merit Rating Programme”.

Over a period of time, this concept has been through an ocean

of change. The areas of evaluation have also changed.

2. Once an employee has been selected, trained and embarked onhis duties, it is time for performance appraisal. What is

performance appraisal? Why do companies need to take up this

task?

3. According to Carl Heyel, author/editor on management,

philosopher and teacher, “it is the process of evaluating the

performance and qualifications of the employees in terms of job

requirements, for administrative purposes such as placement,

selection and promotion, to provide financial rewards and other

actions which require differential treatment among the members

of a group as distinguished from actions affecting all members

equally”.

II. An integral part of performance management system:

1. Effective performance management requires a good deal of

face-to-face supervisor-employee interaction. By knowing the

subordinates, a supervisor can steer them onto a path of greater

productivity and optimized output. Long-term successful

28



business owners view performance appraisal as a process of

getting to know the people who work for them. It is the most

significant and indispensable tool for an organization. It

provides information, which helps in taking important decisions

for the development of an individual and the organization.

2. Thus, one phase of the annual performance management cycle

is performance appraisal, the process of reviewing employee

performance vis-à-vis the set expectations in a realistic manner,

documenting the review, and delivering the review verbally in a

face-to-face meeting, to raise performance standards year over

year through honest and constructive feedback. In the process

management expects to reinforce the employee’s strengths,

identify improvement areas so that one can work on them and

also set stretched goals for the coming year.

3. It is composed of the following two processes both of which are

qualitative subject to human bias –

a. observation and

b. judgment

4. The parameters of performance are a combination of technical

expertise and behavioral attributes. The latter scores a high

degree of relevance with regard to potential appraisal.

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III. Concept Of Performance Appraisal:

The concept of Performance Appraisal can be explained with the

analogy illustrated below:

→ The head of the key represents the uniqueness of the employee.

No two employees are alike.

→ The ring represents the management’s requirement -the job

content.

→ The shaft represents the communication between the employee

and the company, the transmission of the task and the response

from the performer.

IV. Change:

1. A few decades ago, the employee used to be appraised by his

department head. The department head used to communicate hisfeedback and comments only to the immediate superior of the

employee. Thus the feedback was kept confidential in nature.

As time passed by, the immediate superior started appraising his

subordinate’s performance and sending his confidential report to

the department head. These were the periods when the employee

was not included in his appraisal process. The decisions used to

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be taken by his superiors relating to his pay hike, promotion etc.

Thus the system was non-transparent.

2. The current process of performance appraisal is much more

open and gives some scope for self-appraisal by the employee.

The self-appraisal is followed by a joint discussion with

superior and then a decision is taken by the department head on

his promotion, pay hike etc. The feedback relating to his

performance is directly given to the employee. Thus

performance appraisal process has gone through the phase of

non-transparency to transparency.

3. In this transparency phase, a performance appraisal can be

defined as a structured formal interaction between a subordinate

and supervisor, that usually takes the form of a periodic

interview (annual or bi-annual), in which the work performanceof the subordinate is examined and discussed, with a view to

identifying weaknesses and strengths as well as opportunities

for improvement and skills development.

4. Whether an organization accepts or not the usefulness of

Performance Appraisal, whether it adopts a formal appraisal

system or not, top management is constantly appraising the

performance of its subordinate managers in day-to-day

interaction. The latter are doing the same to their own

subordinates. They are doing so because Performance

Appraisal, formal or informal, lies at the heart of art of

managing.

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5. Managing is a dynamic process, concerned almost entirely with

the present and the future, whereas Performance Appraisal, as

generally used has been a static rating of an employee related

almost entirely with the past. Recently, as some managements

were recognizing that “rating” by itself had very limited utility,

they began to appreciate that managing had evolved into an art.

They saw that “management by hunch” could not longer be

tolerated, and that measurements-no matter how vague – were

essential for the future development of the art of managing.

6. The need for measurements gave birth to several “systems” of

managing which attempted to apply measurements of various

sorts to the different aspects and elements of the manager’s job.

A number of these systems leaned on the better Performance

Appraisal methods for their measuring devices or at least for a

starting point for measurement. In some instances, thesesystems expanded or broadened the meaning of Performance

Appraisal from a mere rating to include the whole concept of

management with all its elements.

Foundations of Performance Appraisal:

Performance Appraisal assesses how well people have been doing

their jobs and what they must do to be better in their jobs. It deals with

the content of the job and what they are expected to achieve in each

aspect of their work. Following are the foundations in Performance

Appraisal process:

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I. Job Profile :

Job description concentrates more on the definition of tasks the

jobholder has to accomplish. It includes details of reporting

relationship and normally covers the overall purpose of the job. It

indicates how an individual’s job will contribute to the achievement

of objectives of a team or a department and, ultimately the mission

of the organization.

II. Objectives:

An objective describes something, which has to be accomplished.

Objectives define what organizations, functions, departments, teams

and individuals are expected to achieve.

There are two types of objectives:

i. Work or Operational Objectives:

It refers to the results to be achieved or the contribution to be

made to the accomplishment of team, departmental and

corporate objectives.

ii. Developmental objectives:

It is concerned with what individual should do and learn to

improve their performance and/or their knowledge, skills and

competencies (training and personal development plans).

III. Competencies:

Competencies refer to the behavioral dimensions of a role. It is the

behavior required of people to carry out their work satisfactorily.

Competencies are what people bring to a job in the form of

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different types and levels of behavior. They govern the process

aspects of job performance.

IV. Values :

Increasingly, organizations are setting out the core values that they

think should govern the behavior of all their employees. Value

statements may be prepared which define core values in areas such

as care for customers, concern for people, competitiveness,

excellence, growth, innovation.

Three Essential Steps For Effective Performance Appraisal:

The process of getting to know the people who work for the organization

involves three essential steps viz. training, evaluation and review.

I. Training:

Successful training is the implementation of a system in which

everyone in the workplace is geared towards improvement. It

involves a hands on approach in which the employee is encouraged

to evaluate himself or herself under the guidance of the appraiser.

How it works?

First, the appraiser includes the employee in the appraisal process.

When an employee knows that his or her opinion of other workers is

taken into account, he or she also realizes that everyone else’s opinion

matters just as much. This not only empowers the employee and

improves relations in the workplace, but it encourages higher

productivity as well. This interactive approach is made complete with

the leadership of the appraiser. Carefully administering praise coupled

with constructive criticism keeps the workforce on its toes.

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II. Evaluation:

The best methods for employee evaluation are based on results

and behavior. While conducting performance appraisal based on

employees’ characteristic traits is quite common, the results are often

subjective and unsatisfactory. A results-based approach to performance

appraisal is by far the cleanest, most objective method of tackling the

complex task of evaluation. It uses a rating system to measure

productivity within a given timescale. If an employee makes a certain

number of sales in a certain week, he or she can be rated by sheer worth

as well as ranked against other employees. The study of behavior is

closely tied to productivity. The pace of work, willingness to put in

overtime and ability to work with others all contribute to overall

productivity.

III. Review:

The review process should, again, employ the techniques of

interactivity. Before sitting down together, the appraiser should give the

employee a chance to review himself or herself. This not only

empowers the employee, but also saves a lot of time and possible

contention during the actual discussion. Initially the appraiser should

walk the employee through the process. The successful supervisor starts

out with an overview of why the review session is needed. Then the

supervisor takes the employee down a point-by-point list of every

aspect of the job. In each case, the employee should be given a chance

to describe his or her achievements and shortcomings. The supervisor

should always supplement this with added insight. While praising and

applying criticism, the supervisor maintains authority throughout the

review and indeed, the entire appraisal process.

Objectives and Benefits:

35



The objectives and benefits of Performance Appraisal system can

be summarized as under:

I. Objectives:

Data relating to Performance Appraisal of employees are recorded,

stored and used for several purposes like:

• Let the employees know where they stand in so far as their

performance is concerned and to assist them with constructive

criticism and guidance for the purpose of their development.

• Assessment of skills within an organization.

• Set targets for future performance.

• Effect promotions based on competence and performance.

• Strengthen relationship between superior and subordinate.

• Assess the training and development needs of employees.

• Identify the strengths and weaknesses of employees.

• Decide upon a pay raise (increments).

• Improve communication as it not only provides a system for

dialogue between the superior and the subordinate, but also improves

understanding of personal goals and concerns. This can also have the

effect of increasing the trust between the appraiser and appraisee.

• Determine whether human resource programs such, as selection,

training and transfers have been effective or not.

II. Benefits:

The following are the benefits of a successful appraisal system:

1. For the Organization:

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♦ Improved performance throughout the organization due to:

− Effective communication of organization’s objectives

and values.

− Increased sense of cohesiveness and loyalty.

− Managers are better equipped to use their leadership

skills and to develop their staff.

♦ Improved overview of tasks performed by each member of

a group.

♦ Identification of ideas for improvement.

♦ Creation and maintenance of a culture of continuous

improvement.

2. For the appraiser:

♦ Opportunity to develop an overview of individual jobs.

♦ Opportunity to identify strengths and weaknesses of

appraisees.

♦ Increased job satisfaction.

♦ Opportunity to link team and individual objectives with

department & organizational objectives.

♦ Opportunity to clarify expectations that the manager has

from teams and individuals.

♦ Opportunity to re-prioritize targets

♦ Means of forming a more productive relationship with staff

based on mutual trust and understanding.

♦ Due to all above Increased sense of personal value

37



3. For the appraisee:

♦ Increased motivation and job satisfaction.

♦ Clear understanding of what is expected and what needs to be

done to meet expectations.

♦ Opportunity to discuss aspirations and any guidance, support or

training needed to fulfill these aspirations.

♦ Improved working relationships with the superior.

♦ Opportunity to overcome the weaknesses by way of counseling

and guidance from the superior

♦ Increased sense of personal value as he too is involved in the

appraisal process

In line with the objectives of Performance Appraisal, to reap it’s

benefits, this system has to be effective failing which it may mar the very

purpose of performance appraisal.

Effective Appraisal Process:

When it comes to performance appraisal, managers and employees

agree about one thing: They hate going through them. Employees,

managers and HR experts agree that fear, guilt, responsibility and

resentment are the real reasons why most employees dread the appraisal

process. Besides some think that it is a ritual that is mandatory to follow.

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An effective review process helps organizations in three areas:

1. evaluation and improving personnel selection and training

systems;

2. preventing wrongful termination; and

3. increasing real employee diversity

I. Good appraisals start with information from multiple sources, and

they evaluate employees at all levels from top to bottom.

II. This system requires both the appraisee and appraiser to jointlyassess the employee’s ability to complete the duties and achieve the

goals set forth in the previous appraisal.

III. HR professionals should consider the following steps and make the

appraisal process simple yet effective:

• The performance Appraisal form should reflect the strategic

objectives of the company. Many organizations use a form that

contains several sections.

• The results and impact section should address accomplishments

related to job responsibilities, goals and projects. It is a review

of past performance.

• A skills and abilities section should discuss the ways those

results were accomplished. By listing the core competencies

for each job classification – and for the entire organization –

this section can address the kinds of behavior that are critical

for success.

IV. Appraisal results, either directly or indirectly, determine reward

outcomes. The better performing employees may get the majorityof available merit pay increases, bonuses and promotions, while the

39



poorer performers may require some form of counseling or in

extreme cases no increases in pay. The assignment and justification

of rewards and penalties through performance appraisal is a very

uncertain and controversial matter and conveys both satisfaction as

well as dissatisfaction with an employee’s job performance.

Whatever is the case, organizations should foster a feeling that

performance appraisals are positive opportunities that provide for

overall development of the employee, in order to get the best out of

the people and the process. Hence performance appraisals should be

positive experiences and it should never be used to handle matters

of discipline.

Designing an Appraisal Process:

Before understanding the process of appraisal, the following terms

are revised:

▪ Performance refers to an employee’s accomplishment of assigned

tasks.

▪ Performance Appraisal is the systematic description of the job-

relevant strengths and weaknesses of an individual or a group.

▪ Appraisal period is the length of time during which an employee’s

job performance is observed in order to make a formal report of it.

▪ Performance Management is the total process of observing an

employee’s performance in relation to job requirements over a period

of time (i.e. clarifying expectations, setting goals, providing on-the-

job coaching, storing and recalling information about performance)

40



and then making an appraisal of it. Information gained from the

process may be fed back via an appraisal interview to determine the

relevance of individual and work-group performance to

organizational purposes, improve the effectiveness of unit and

improve work performance of employees.

Designing an appraisal program poses several questions, which need

answers. They are:

1. Whose performance is to be assessed?

2. Who are the appraisers?

3. What should be evaluated?

4. When to appraise?

5. What problems are encountered?

6. How to solve the problems?

7. What methods of appraisal are to be used?

1. Whose performance should be assessed?

The answer is obvious – employees. When we say employees, it is

individual or teams? Specifically, the appraisee may be defined as

the individual, work group, division or organization.

2. Who are the appraisers?

Appraisers can be immediate superiors, specialists from the human

resource department, subordinates, peers, committees, clients, self-

appraisals or a combination thereof.

41



3. What should be evaluated?

One of the steps in designing an appraisal program is to determine

the evaluation criteria. It is obvious that the criteria should be

related to the job. The criteria for assessing performance can be:

a. Quality & Quantity

b. Timeliness

c. Cost Effectiveness

d. Need for supervision

e. Interpersonal impact

f. Innovation & Creativity

g. Problem Analysis

h. Customer orientation

i. Market Orientation

j. Entrepreneurial Drive

k. Negotiation skills etc.

This is not an exhaustive list, but several other parameters too can be

added depending on job requirements and organizational needs.

4. When to appraise/rate?

The most frequent rating schedules are semi-annual and annual.

New employees are rated more frequently than older ones. Some

practices call for ratings:

∙ Annually as per company practice

∙ After first 6 months of employment

∙ Upon promotion or within 3 months after promotion

42



∙ When the job occupied has been reevaluated upward

∙ Upon special request, as when the employee’s salary is below

the average pay

5. What are the problems related to Performance Appraisal?

An ideal Performance Appraisal is done when the evaluation is free

from biases and idiosyncrasies of the evaluator. There are many

factors of appraisal that lead to failure of the system:

a. Negative attitude towards Performance Appraisal:

There is a large population of managers who are hostile or

indifferent to the Performance Appraisal processes and/or do it

badly if they do it at all.

i. Hostility from the appraiser :

The appraiser reacts indifferently to the appraising system

because he believes that it is a waste of time. At times

they feel that the scheme has nothing to do with their ownneeds and it exists to feed the personnel database.

ii. Hostility from the appraisee:

Hostility from the people at the receiving end arises

because they feel Performance Appraisal is simply another

method in the hands of the managers to exercise their

command and control prerogatives. They feel that the data

collected will be utilized as evidence against them. In

some cases appraisees even have a feeling that the

outcome of the performance evaluation is predetermined

by the management or their superiors and the process is

completed only as a formality, due to which appraisees

lack interest in the entire appraisal process.

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b. Halo Error :

Under this type of error, one marked characteristic or latest

achievement or failure of the appraisee (either favourable or

unfavourable) may be allowed to dominate the appraisal for the

entire year.

c. Logical Error:

This is a dangerous pitfall for the inexperienced appraiser. He

is very often inclined to arrive at similar assessments in respect

of qualities that seem logically related.

d. Constant Error:

When two appraisers rate an appraisee their ratings may be

different. One may show consistent leniency by giving him

high scores, the other my consistently rate him by giving low

scores.

e. Central Tendency:

It is also called as “Average Ratings”. Here, the appraiser tends

to avoid giving frank views to the question asked or the

appraiser is in doubt or he has inadequate information or he

simply wants to play safe and don’t displease anyone.

f. Mirror-Image Error or Projection Error:

This error arises when an appraiser expects his own qualities,

skills, and values in an appraisee. The appraiser may falsely

believe that if the appraisee is good he has to be like him

(appraiser) because the appraiser considers himself as the

standard.

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g. Contrast Error:

This error occurs in the sequencing of ratings. If superior

performers are rated first, average performers are rated down, if

poorer performers come first, the average performers will be

rated more highly.

h. Biases of position, Sex, Race, Religion & Nationality:

There is a tendency to rate the occupant at a higher position

more favorably than the person in a lower position. Similarly

rating can be biased based on sex, religion and nationality too.

i. Lack of Skill in conducting Appraisal discussion:

Conducting Performance Appraisal discussions require certain

skills and training.

6. How to solve the appraiser’s problems?

The best way to overcome the problem is to give training to the

appraiser. Training can help improve the appraisal system to the

extent that distortion occurring due to appraiser errors such as halo,

leniency, central tendency and bias are minimized.

a. Factors that help to improve accuracy:

• The appraiser has observed and is familiar with behaviors to

be appraised.

• The appraiser has documented behaviors calling for

improvement.

• The appraiser has a checklist to obtain the review on job-

related information.

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• The appraiser is aware of personal biases and is willing to

take action to minimize their effects.

• Rating scores by appraisers of one group or organization are

summarized and compared with those by other appraisers.

• The appraiser focuses attention on performance related

behaviors over which he has better control than on other

aspects of evaluation.

• Higher levels of management are held accountable for

reviewing all ratings.

b. Factors that may lower accuracy:

• The appraiser rates only when administrative actions are

contemplated.

• The appraiser is unable to express herself/himself honestly

and unambiguously.

• Appraisal systems, processes and instruments fail to support

the appraiser

• The appraiser is unaware of causes of rating errors.

• The appraiser has to rate employees on factors that are

poorly defined.

7. Techniques/methods of appraisal to be used?

There are different types of systems for measuring the excellence of

an employee. Each type has its own advantages and disadvantages. The

earlier developed methods, still being used, are Traditional Methods that

46





- A scale of people is also created for each factor.

- Each Appraisee is compared to every other person on the scale.

- Certain scores for each factor are awarded to the appraisee.

Grading

- Certain categories of traits/performance criteria, which are

worth of appraising, are established. E.g. cooperativeness, self-

expression, dependability, job knowledge etc.

- The actual performance (Key performance area) of an employee

is then compared to the predetermined grade definitions.

- Appraisee is allotted with the grade, which describes his

performance in the best possible manner.

- Any grade that is selected should be well defined.

Graphic Scales

- A printed form, one for each person to be rated is used.

- The factors included in the form are Employee characteristics

such as leadership, cooperativeness, enthusiasm, loyalty etc. or

Employee contribution which includes quantity and quality of

work, specific goals achieved, regularity of attendance,

responsibility assumed etc.

- The traits can be evaluated on continuous scale – the appraiser

places a mark along a continuum (range).

- The best method to use is the “multiple” type of scale wherein

one has to “tick off” the box, which suits the description of an

appraisee’s performance.

- Certain types of graphs are prepared based on these derived

ratings.

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Checklist

- A series of questions are presented concerning an appraisee’s

behavior.

- The appraiser has to reply to the questions in either negative or

positive tone- (Yes/No).

- The value of each question may be weighted i.e. one can have

predetermined scale and scoring to those questions.

Essay

- A blank form is given to the appraiser.

- The form contains main heading such as employees’

characteristics, attitudes, job knowledge, potential etc.

- The appraiser is asked to put in words his impressions about the

employee.

- It contains factual and concrete knowledge.

- It gives specific information about the employee.

Confidential Reporting

- It is the most traditional way of appraising employee’s

performance. The basic assumption here is that since the

superior is in direct contact he knows his subordinates better

than any other and hence his appraisal would be more

appropriate.

- The superior writes a paragraph or so about his subordinate’s

strengths, weaknesses, intelligence, attitude to work,

attendance, conduct and character, work efficiency, etc.

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Critical Incident Method

- Initially a set of noteworthy (good or bad) on-the-job behaviours is

prepared. This is usually in the form of incidents.

- These incidents are given to a group of experts who assign scale

values depending upon the degree of desirability for the job.

- This checklist is used by superiors for evaluating the employees.

- This method helps in identifying the key areas where the

employees are weak or strong.

- It emphasizes rating on objective evidence and helps in counseling.

Forced Choice Technique

- In forced choice system the appraiser is forced to choose one

from among a group of 4 statements that best fits the individual

being rated and one which least fits him.

- Each statement is given a value or a score.- The evaluator does not know the score value of statements;

hence he cannot show any favor towards the appraisee.

- The method of arranging the traits involves a long process from

getting the description of “good” or “bad” employees to

establishing their validity and reliability.

Behaviourally Anchored Rating Scales (BARS)

- Behaviourally Anchored Rating Scales (BARS) are anchored

with descriptive alternative behaviors.

- For every given category of behavior or performance,

statements are ordered in an ascending or descending order of

excellence.

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- Although these scales represent job-relevant dimensions of

performance, they still pose problems in determining which

actually, observed behaviours match with specifically anchored

performance scales.

- Despite this difficulty, BARS are a significant improvement,

since they require less inference on the appraiser’s part as

against traditional rating approaches.

The above methods are non-transparent in nature, as the appraisee

or the employee is not involved in the process of his appraisal. The rating

is done entirely by his superiors.

New Frontiers to Performance Appraisal :

In recent years the system of performance appraisal is becoming

more and more transparent wherein the employee, who is being

appraised, is involved in the process. The objectives or targets are set

with mutual understanding between the appraisee and his immediate

superior. The feedback regarding his performance is given to the

appraisee with areas of improvement by disclosing his strengths and

weakness and the opportunities available. I will take you into details of

these new frontiers to Performance Appraisal viz:

I. Management by Objectives (MBO)

II. 360º Feedback

III. Balanced Scorecard

I. MANAGEMENT BY OBJECTIVES

1. Management by Objectives is basically a process whereby the

superior and the subordinate managers of an enterprise jointly

51



identify its common goals, define each individual’s major areas of

responsibility in terms of the results expected of him and use these

measures as guides for operating the unit and assessing the

contribution of each of its members. Management by Objectives is

primarily to change the behaviour and attitude towards getting an

activity or assignment completed in a manner that it is beneficial for

the organization. Management by objectives is a result-oriented

process, wherein emphasis is on results and goals rather than a

prescribed method. A number of companies have had significant

success in broadening individual responsibility and involvement in

work planning at the lowest organizational levels.

2. The concept rests on a philosophy of management that emphasizes

integration between external control (by managers) and self-control

(by subordinates). It can apply to any manager or individual no

matter what level or function, and to any organization, regardless of

size.

For instance, the number of quality articles to be churned out in a

week at a publishing house is, let’s say, five. This is the goal of the

organization. This goal has to be set in coordination with the

writers. The emphasis here again would be on accomplishing this

task flawlessly over the week rather than the setting of a method toaccomplish the same. You are giving them a free hand to decide as

to how they want to work in order to accomplish target. This gives

the employee both responsibility as well as authority to do a job.

The employees are now responsible for its success or failure and it is

their baby. It is a VERY SMART MANAGEMENT TOOL where

the employee is involved in the decision making process.

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3. Management by Objectives is a five-sutra process having

following basic steps:

i. Set Organizational Goals:

This envisages that organizational goals and business

strategies are expressed clearly, concisely and accurately.

They are periodically reviewed. They should be challenging

enough to motivate the employee. Clear and attainable goals

help channel energies towards desired behaviour and let the

employee know the basis on which he will be rewarded. At

this time, any appropriate changes in the organization

structure should be made: changes in titles, duties,

relationships, authority, responsibility, span of control and so

forth.

ii. Joint Goal Setting:

This step establishes short-term goals, which are performance oriented, between the management and the

employee. The responsibilities are clarified to the

employees through organizational charts and job description.

The goals decided by the employee need to complement the

goals of the management. They also need to be flexible to

accommodate new ideas without losing individual

responsibilities. Moreover they should be easily

quantifiable. For example:

To prepare, process and transfer to the office

superintended, all account payable vouchers within three

working days from the receipt of the voucher.

To hold weekly meetings with all employees.

53



To use program evaluation and review technique (pert)

for all new plant layouts.

iii. Performance Reviews:

This step suggests frequent performance reviews between

the manager and the employees. During the initial stages the

meetings be held once a month and later could be quarterly.

For maximum benefit these meetings should be scheduled

for more than once a year.

iv. Set check posts:

Establishment of major check posts to measure progress.

This is merely to check that the employee surges towards his

premeditated (planned) goal without any disruptions. These

check levels should be higher in the initial stages and then

gradually reduce. This demands that the manager should be

on constant alert and exercise sound judgment.

v. Feedback:

The employees who receive frequent feedback about their

performance are highly motivated than those who do not.

However, one has to ensure that the feedback is relevant and

specific. This helps the employee and the manager

understand where they stand.

The five-sutra process of management by objectives ensures that the

manager and the employee define and establish goals and objectives for

an employee to be achieved within a prescribed period of time. The

employee is to be supervised and evaluated, periodically. To this extent,

54



a frequent feedback and superior-employee interaction model must be

evolved.

4. Throughout the time period what is to be

accomplished by the entire organization should be compared with

what is being accomplished; necessary adjustments should be made

and inappropriate goals discarded. At the end of the time period a

final mutual review of objectives and performance takes place. If

there is discrepancies between the two, efforts are initiated to

determine what steps can be taken to overcome these problems. This

sets the stage for the determination of objectives for the next period.

Benefits of MBO Program

a. Helps and increases employee motivation because it relates

overall goals to the individual’s goals; and help to increase an employee’s

understanding of where the organization is and where it is heading.

b. Managers are more likely to compete within themselves than with

other managers. This kind of evaluation can reduce internal conflicts

that often arise when managers compete with each other to obtain scarce

resources.

c. Results in a “means-ends” chain. Management at succeedinglylower levels in the organization establishes targets, which are integrated

with those at the next higher level. Thus, it can help ensure that

everyone’s activity is ultimately aimed toward organization’s goals.

d. Reduces role conflict and ambiguity. Role conflict exists when a

person is faced with conflicting demands from two or more supervisors;

and role ambiguity exists when a person is uncertain as to how he will be

55



evaluated, or what he has to achieve. Since MBO aims at providing clear

targets and their order or priority, it reduces both these situations.

e. Provides more objective appraisal criteria. The targets that

emerge from the ` process provide a sound set of criteria for evaluating

the manager’s performance.

f. Forces and aids in planning . By forcing top management to

establish a strategy and goals for the entire organization, and by requiring

other managers to set their targets and plan how to reach them.

g. Identifies problems better and early. Frequent performancereview sessions make this possible.

h. Identifies performance deficiencies. It enables the management

and employees to set individualized self-improvement goals and thus

proves effective in training and development of people.

i. Helps the individual manager to develop personal leadership,

especially the skills of listening, planning, counseling, motivating and

evaluating . This approach to managing instills a personal commitment to

respond positively the organization’s major concerns as well as to the

development of human assets. Such a manager has a far greater chance to

move ahead within the management hierarchy.

II. 360° FEEDBACK

With the movement in the eighties to find new strengths and

productivity through employee empowerment came the idea of

performance appraisals from subordinates, their superiors, their peers

and themselves – “360º feedback .”

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1. The 360º Feedback process is called multi-source assessment,

taps the collective wisdom of those who work most closely with

the employee, superiors, colleagues (peers), direct reports and

possibly internal and often external customers. The collective

intelligence these people provide on critical competencies or

specific behaviours and skills gives the employee a clear

understanding of personal strengths and areas ripe for

development. Employees also view this performance information

from multiple perspectives as fair, accurate, credible, and

motivating. Employees are often more strongly motivated to

change their work behaviours to attain the esteem of their

coworkers than to win the respect of their supervisor alone.

2. As the 360º Feedback process better serves the needs of

employees, it serves the changing needs of their organizations

too. Organizations are reducing hierarchy by removing layers of

management and putting more emphasis on empowerment,

teamwork, continuous learning, individual development, and self-

responsibility. The 360º Feedback Model aligns with these

organizational goals to create opportunities for personal and

career development and for aligning individual performance

expectations with corporate values.

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Diagram showing the key stakeholders in a 360º Feedback

Process

Benefits to Key Stakeholders

The 360º Feedback process offers extensive and diverse benefitsto key stakeholders in the organization – and the organization too:

a. Customers: The process gives customers a chance to

strengthen the customer-supplier relationship. The 360º

Feedback captures the relevant and motivating information

from internal and external customers while giving them a

voice in the assessment process.

b.Employees: By participating in a process that has tremendous

impact on their careers, employees may help select what

evaluation criteria will be used to judge their performance

and who will provide feedback. Participation plays a critical

role for employees as they determine the fairness of the

process.

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c. Team members: The only option for identifying team and

individual members’ effectiveness is 360º Feedback. Failing

feedback from multiple sources, team members lack the

information necessary for effective individual development

and teamwork. With no team evaluation, accountability may

evaporate, and performance may falter (weaken).

d.Supervisors: This process expands supervisors’ insight

regarding the performance of each direct report by providing

them more comprehensive and detailed performance

information than they usually have access to. Also, the

process typically reduces by half, or more, the supervisor’s

time spent on evaluating individual employees.

e. Leaders and Managers: The process provides leaders and

managers an opportunity to tap information from the

organization that may otherwise not be shared with them for fear of reprisal.

f. Organizations: Organizations can gain access to credible,

quantitative information to understand organizational

strengths and weaknesses, leadership gaps, and training

needs more fully. This information is much more useful

than relying on intuitive judgment or responding to those

who are making the most noise.

Why are Organizations adopting these systems?

Structure and cultural factors and employee’s relations have

motivated organizations to begin experimenting with 360º

Feedback systems. For example, as organizations remove layers

of management, flatten their structure, and begin using self-

59



directed teams, the only practical option for performance

feedback is from multiple sources. As organizations change their

culture to align with their vision and values, 360º Feedback

becomes an ideal choice to communicate the new competencies

required by the new values.

Structure changes

Organizational structures have changed substantially since the

mid-1980s. The 360º Feedback process offers support for these

structural changes, such as growth in supervisor’s span of control,

the increased use of technical or knowledge workers, and

introduction of matrix and project management organization

design, and the move to working in teams.

g.Increased span of control: A typical manager used to

supervise three to nine employees. Today production and

service companies have moved from traditional span of

control to one supervisor for as many as seventy or more

direct reports. Classic supervisors with a large number of

reporting relationships lack the opportunity to observe many

individual performance actions.

h.Knowledge workers: A supervisor may not have enough

technical or expert knowledge to provide credible performance feedback on employees in positions requiring

highly specialized knowledge, like MIS managers or

scientists. Many organizations have adopted a multi-source

system to provide accurate assessments by coworkers with

similar expertise.

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i. Matrix and Project Management: Many organizations have

adopted 360º Feedback systems because their employees

work in matrix or project management situations, with

employees often reporting to more than one supervisor

during a project.

Matrix organization structures occur as a result of the need to

deploy human assets at high velocity. People move quickly

from project to project and may only occasionally interact

directly with their supervisor. Project management designs

require information from multiple sources because no one

person has sufficient information to provide a complete

performance picture of the individual.

j. Team: When the organizational structure has moved from

classic supervisory designs to work teams, with leadership

dispersed throughout the team, team members offer highly

credible performance feedback.

Change in Organizational Culture

Revolutionary changes in organization cultures have made

traditional single-source assessments illogical and impractical.

Among these changes are:

a. Participative Leadership: Organizations have given

employees a voice in organizational decision processes and

have adopted 360º Feedback systems to drive culture change

and align individual behaviours with organizational values

and objectives. Leaders who best empower employees are

recognized and rewarded when those they lead provide

excellent performance feedback.

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b. Empowerment: The 360º Feedback process communicates

the appropriate actions needed from employees to support

this culture change, and these actions are then recognized

and rewarded.

c. Customer Services: The improved communication through

360º Feedback can translate to better customer service.

d. Quality Focus: The 360º Feedback systems provide the best

measures for competencies. This logical application for

individual performance measurement meshes with the

organization’s quality philosophy.

e. Reengineering: Reengineering or the reinvention of work

processes often requires new methods to obtain accurate

performance measures. Reengineering actions focus on

redesigning the way employees work in order to improve

individual, team, and organizational productivity. Since

360º Feedback systems improve the quality of information,

these systems logically support the reengineering effort at

organizations.

f. Competency-Based Reward: Information from multiple

sources offers the best method for measuring competencies.

Traditional, single-source measures are deficient at assessingcompetencies because supervisors seldom have sufficient

opportunity to observe each employee’s full range of work

behaviours.

g. Team-Based Rewards: 360º Feedback systems are the most

appropriate ways to evaluate individual performance and

contribution. Team assessment provides these organizations

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with a credible information source for recognition and

rewards.

h. End of Entitlements: Multi-source performance measures

more clearly distinguish among levels of performance than

do single-source measures. Multi-source assessments are

substantially better at distinguishing high, medium, and low

performers, enabling appropriate recognition and rewards

and an end to automatic entitlements.

Employee Relations

No other information has more impact on an employee’s career

than information on his or her performance. Hence, the accuracy,

fairness and usefulness of performance measures are critical

factors to employees.

a. Career Development: The 360º Feedback process yields

specific and quantitative information for each employee to

use in making intelligent career decisions.

b. Fair Reward Decisions: Managers and employees want pay

and promotion decisions to be fair. Research across large

sets of employee groups indicates that users perceive 360º

Feedback to be fairer than single-rate processes.

c. Accurate Performance Measures: Assessment by multiple

coworkers is more reliable and objective than information

gained from a single person because they have the best

opportunity to observe work behaviours.

d. Valid Performance Measures: Assessment information

when provided by the individual’s work associates; the

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employee tends to perceive the results as having for more

credibility as against a single-source assessment.

e. Non-performance: Supervisors must document, justify and

confront non-performance. 360º Feedback systems helps in

identifying non-performers or poor-performers as co-

workers and team members are rarely reluctant to identify

them if they are not sufficiently contributing to the team’s

efforts and try to push them if they need help.

f. Diversity Management: Multi-source performance

measures moderate adverse discrimination against older

employees, presumably recognizing the great experience

level; are generally neutral to women as against single-

source assessment which are often biased.

g. Legal Protection: Multi-source assessments offer stronger

legal protection, resembling the jury system because the

model combines multiple perspectives.

Pitfalls of 360º Feedback

a. 360º feedback has produced some real successes; but when

not done artfully, including internal preparation, it can

rebound. Colleagues and subordinates are good judges of behaviour and managerial style but are not best judges of a

manager’s job performance. Hence the ratings should be

used with caution in decisions for pay and promotions.

b. In practical, peers and subordinates tend to give negative

feedback about a manager due to bias or for setting scores.

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Such feedback may get undue importance when only

selected few peers and subordinates appraise a manager.

c. Also, at times, the organizational culture is unable to accept

the system.

Options for implementation

There are three common ways of getting 360º degree feedback

each more comprehensive and powerful in promoting change,

both organizational and personal:

i. using an outside consultant, minimizing any personal friction

within the organization;

ii. launching a comprehensive program in-house to get

feedback on all key people, top to bottom;

iii. creating a comprehensive program designed to uncover not

just personal flaws but systematic and organizational ones,too.

The implementation of the same are detailed below:

a. Send a few managers to an outside consultancy for

assessment and feedback. Here, managers may hand out

survey to whom they know (and expect to get feedback withminimal negative information) the data collected by the

consultancy, and the managers receive an "offsite" training

and feedback session with similar managers from different

companies.

While this approach has its merits, its major deficiency is

that a few individuals are changed, the overwhelming mass

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of management is not, and the systems and processes that

encourage old behaviors are still in place.

b. The second approach is to bring such a program "in-house",

where many managers receive 360º feedback. In this

approach, the feedback can be more systematic for two

reasons: i) surveys are handed out to all subordinates and

peers rather than those who have been "volunteered" by the

person receiving feedback. This tends to reduce "sampling

bias" of just giving it to those who might give just good

feedback; and ii) the implementation of this process can be

from the top of the organization down the bottom. This has

the advantage of allowing upper management to be an

example of willingly receiving such feedback and encourage

them to be both models of behavior and coaches to those

underneath them.

c. The third approach involves all of the second approach, and

also deals with "systems issues." Where 360º feedback alone

can only deal with problems caused by individual behavior,

it by itself does nothing for the systemic causes of problems,

such as organizational structure, inappropriate and distorted

measurement systems, company-wide lack of skills, or

performance appraisal and pay problems. 360º Feedback can

serve both as a catalyst to help management realize the

systemic causes of organizational problems, and can be part

of the solution, so that management style becomes in

harmony with other organizational changes senior

management is trying to make.

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The following issues need to be considered before implementation

of 360º feedback

Questions about implementing 360º feedback are easy to ask but

not so to answer. Often times, management assumes the answers

but does not openly discuss them with the result being much

chaos and confusion down the road.

Among these some of these questions are:

a. How ready is your organization to handle 360º Feedback?

Often times, organizations may be willing to pay consultants

to assist them in implementing such a system, but the

organization needs to be prepared. At times, "soft skills"

training in communication, leadership, management style,

meeting management etc. is useful in preparing

management. Teambuilding activities might also be useful,

as well as a general organizational climate survey to

determine the context of implementation and find any

additional issues beyond management style that might be a

problem.

b. Who needs to agree? Who will be the decision-making

body about 360º feedback? Will it be the head of the

organization, or Human Resources, or a cross-section of

employees from a variety of levels?

c. Who will be involved? Which employees are to be the

focus of the 360º feedback, and who will provide it to them?

d. Is this voluntary or mandatory? Will some employees be

offered the "opportunity" to receive this feedback, will

everyone receive it, or will just management receive the

feedback?

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e. What methods and measurements will be used? Will

employees just fill out numerical surveys, or will this

information be supplemented with observations and

interviews? Will the report be just a graph, a summary of

high need for change survey items, or will there be a written

report with recommendations? To what extent will this

report be personalized and handcrafted Vs being automated?

f. To what extent will the data be collected anonymously

and/or confidentially? While the intent may be to keep the

survey data anonymous, if written comments or interview

data are also included, the data may have to be altered to

avoid making obvious conclusions about who communicated

what. In addition, management must answer questions about

personal, confidential data that might be accidentally

revealed during interviews.

g. To what extent will the data be collected anonymously

and/or confidentially? While the intent may be to keep the

survey data anonymous, if written comments or interview

data are also included, the data may have to be altered to

avoid making obvious conclusions about who communicated

what. In addition, management must answer questions about

personal, confidential data that might be accidentally

revealed during interviews.

h. What will be done with alleged violations of laws, ethics

or policies? Though this may not be the intent of 360º

feedback, on occasion information is gathered that suggests

violations of legal, ethical and company codes of conduct.

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i. What information will be public? At first blush, you might

think that all data will be private, but does that mean that

one's own supervisor can't see the data and the report? Will

group and company averages be made public without them

being broken down into individual scores?

j. What consequences will there be? Will they receive

additional coaching and counseling, training, or be

terminated or re-assigned? Will the 360º feedback be the

sole determiner of this decision?

k. What logistics and support will be necessary to make this

successful? To what extent will the data be collected

electronically (via the Web or intranet) or on paper? What

administrative and technical support will be necessary?

l. What systems changes will accompany this

organizational change? As stated before providing

feedback on management style in and of itself can only be

part of organizational change and can rarely stand on its

own. As a result, one must ask how and when will 360º

degree feedback be incorporated into training, selection and

pay decisions?

III. BALANCED SCOREBOARD

1. Balanced Scorecard (BSC) is a set of measures derived from an

organization’s vision and strategy. It is a concept that helps

translate strategy into action. It requires an organization to

balance its goals across multiple perspectives to reduce the

chance that one goal will dominate others to the detriment of

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the organization. It leads to a realistic compromise that

addresses short-term goals and longer-term staying power.

2. The balanced scorecard was developed by Robert S. Kaplan and

David P. Norton in early 1990s. The article The Balanced

Scorecard - Measures that Drive Performance of Harvard

Business Review (year 1992) – describes balanced scorecard as

a methodology used for measuring success and setting goals

from financial and operational viewpoints. With those

measures, leaders can manage their strategic vision and adjust it

for change.

3. BSC links performance measures by looking at a business's

strategic vision from four different perspectives: financial,

customer, internal business processes, and innovation &

learning. These four perspectives of the Scorecard provide a

balance between desired outcomes and drivers for those

outcomes and between objective and subjective performance

measures. BSC is prescriptive about a balanced range of

measures and about how one perspective defines the drivers for

the next.

a. Financial Perspective

The financial perspective provides a view of how the senior

executives, the board of directors and the shareholders see

the company. Typical metrics in this perspective might be

earning per share, revenue growth and profit maximization.

In the BSC, financial measures play a dual role: they define

the financial performance expected from the strategy and

they serve as the ultimate targets for the objectives and

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measures of all the other scorecard perspectives. The

financial measures are chosen based on the business life

cycle and also the strategic theme chosen for the financial

perspective. In addition to increasing returns, most

organizations are concerned with the risk of these returns.

Therefore, when it is strategically important, these

organizations will want to incorporate explicit risk

management objectives into their financial perspective.

As a conclusion, eventually all objectives and measures in

the other scorecard perspectives should be linked to

achieving one or more objectives in the financial

perspective.

b. Customer Perspective

The customer perspective provides a view of how the

customers see the company. Kaplan and Norton contend that,

" to put the balanced scorecard to work, companies should

articulate goals for time, quality, and performance and

service and then translate these goals into specific

measures." Overall, this is a measure of how the company

provides value to the customer. Changes made to a business

process output that lowers the customer’s cost or allows the

customer to achieve his or her objective, have value for the

customer. For example, it’s not enough to simply bring down

the cost of an item. The delivery time and manner in which

the customer is dealt during times of sales and support are

important as well. It is a measure of that value that should be

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captured by the metrics (e.g. market share, customer

satisfaction, customer loyalty, customer acquisition)

representing this perspective.

In this perspective, managers must first determine core

measures that will describe the successful outcomes of a

well-formulated and implemented strategy. They have to

also identify what are the attributes that the customers value

and choose the value proposition that they want to deliver to

the targeted customers. Today, many companies have a

corporate mission that focuses on the customer.

c. Internal Business Process Perspective

The internal business process perspective provides a view of

what the company must excel at to be competitive. Kaplan

and Norton recommend that, "companies also attempt to

identify and measure their company's core competencies, the

critical technologies needed to ensure continued market

leadership."

In this perspective, the managers must identify the internal

processes that are crucial to their organization and develop

the best possible measures with which to track the

organization’s progress. These processes should help them

deliver superior value to their customers and achieve

financial targets. The Balanced Scorecard go beyond the

simple assessment of existing processes, and usually

identifies new processes that the organization should

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implement in order to be successful. By incorporating

innovation processes measures, the Balanced Scorecard

provides managers with a set of tools that does not only

reflect the short term, but also gives insight about the longer-

term.

d. Innovation and Learning Perspective

Kaplan and Norton underscore the importance of innovation

and learning in their statement that, "a company's ability to

innovate, improve, and learn ties directly to the company's

value." While the financial perspective deals with the

projected value of the company, the innovation and learning

perspective sets measures that help the company compete in

a changing business environment. This is of principal

interest to the CEO and the architects of the long-range

business plan. Their focus for this innovation is in the

formation of new or the improvement of existing products

and processes. This perspective looks at how effectively the

organization can redesign and implement new business

process, introduce and exploit new technology and adapt to

changing conditions in general. Thus the measures in this

perspective are truly the enablers of the other three

perspectives. These measures are like the roots of a tree that

will ultimately lead through the trunk of internal process to

the branches of customer results and finally to the leaves of

financial returns. Metrics of this perspective can be

adaptability, employee satisfaction, and willingness to share

and gain knowledge.

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With the financial, customer and internal perspectives,

managers are able to identify the gaps between existing

organizational resources and the ones required to be

successful. The only way to close those gaps is for the

organization to judicially invest in employees and

information technology and to design the most appropriate

organizational structure that could support their strategy.

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4. The steps of implementation are:

Identifying and defining Key Performance Indicators from the

multiple perspectives:

First the multiple perspectives are to be identified, which can be, as:

Financial Measure, Customer Measure, Internal Process and People

(Learning & Growth). After this the main task is to identify the Key

Performance Indicators (KPI) in each of these multiple perspective.

a. Identifying Key Action Areas

b. Implementation of Key Action Areas

c. Monitoring Key Action Areas

5. The advantages of the Balanced Scorecard:

a. First, the measures incorporated in the Balanced Scorecard are

grounded in the organization’s strategic objectives and competitive

demands. Therefore, this set of critical indicators helps the

organization focus its efforts on the strategic vision.

b. The four perspectives of the Balanced Scorecard enable

organizations to track financial results while simultaneously

monitoring progress in building the capabilities and acquiring the

intangible assets they need for future growth. The Balance

Scorecard then becomes the cornerstone of the organization’s

current and future success. Also, by balancing external and

internal measures, there is no trade-off among key success factors.

75



c. Finally, managers can use the Balanced Scorecard to:

־ clarify and gain consensus about the strategy;

־

communicate the strategy throughout the organization;

־ align departmental and personal goals to the strategy;

־ link strategic objectives to long-term targets and annual

budgets;

־ identify and align strategic initiatives;

־ perform periodic and systematic strategic reviews;

־ obtain feedback to learn about and improve strategy.

6. Potential Problems with a Balanced Scorecard:

a. The creation of a Balanced Scorecard involves a considerable

amount of time on the part of everyone whose performance will bemeasured; the selection of appropriate measures for the four

perspectives too is very time consuming. This is simply due to the

fact that there are a large number of potential goals and targets and

even more ways to measure them. People are likely to disagree

about which objectives to measure and how to measure those

objectives, and it will take time before consensus is achieved.

b. The time factor involved in designing a Balanced Scorecard can be

considerable since it involves a lot of people in the organization.

Their commitment is important not only in building the Balanced

Scorecard but especially in implementing and using it. Although a

Balanced Scorecard may be well designed, lack of participation

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and commitment on the part of staff will make the scorecard

useless.

c. Finally, there is always a chance that too many measures will be

selected. This is a problem because it is very difficult to track a

large number of measures. Furthermore, some of the measures

selected may be objective, such as employee turnover rates, and

other measures may be subjective measures, such as employee

morale or quality time spent with customers. The subjective

measures, by definition, involve somebody’s judgment and,

therefore, are more prone to error. Consequently, there is a

question whether subjective measures should be used and if so

how can they be made more reliable.

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1. Is Performance appraisal given adequate importance in your

organization?

A – Yes

B – No

C – Partly

Particulars No. of respondents Percentage

A 15 50%

B 5 16.7%

C 10 33.3%

Interpretation:

The above chart shows that 50% of employees are satisfied, 16.7%

of employees are not satisfied and 33.3% of employees are partly

satisfied with the importance given to the performance appraisal given in

their organization.

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2. Is Performance appraisal really helpful in developing your

performance?

A – Yes

B – No

C – Partly


A 20 67%

B 0 0%

C 10 33%

Interpretation:

The above chart shows that performance appraisal is really helpful

in developing their performance for 67% of the employees and partly

helpful for 33% of the employees.

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3. Have you ever had discussion regarding Performance appraisal

with your manager?

A – Yes

B – No


A 25 83%

B 5 17%

Interpretation:

The above chart shows that 83% of the employees are having

discussion and 17% of the employees are not having discussion with the

manager regarding performance appraisal.

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4. The results you have faced at the end of annual review

A – Promotions

B – Increments

C – Additional responsibility

D – All the above

E – None of the above


A 11 37%

B 6 20%

C 4 13%

D 5 17%E 4 13%

Interpretation:

The above chart shows that 37% of the employees are getting

promotions, 20% of the employees are getting increments, 13% of the

employees are getting additional responsibility, 17% of the employees are

getting promotions, increments and additional responsibility and 13% are

not getting any benefits at the end of annual review.

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5. Is performance appraisal helpful in strengthening work

relationship through personal effectiveness?

A – Yes

B – No


A 27 90%

B 3 10%

Interpretation:

The above chart shows that performance appraisal is helpful for 90%

of the employees and not helpful for 10% of the employees in

strengthening work relationship through personal effectiveness.

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6. Are you informed about your performance parameters?

A – Yes

B – No


A 20 67%

B 10 33%

Interpretation:

The above chart shows that the performance parameters are informed

to the 67% of the employees and are not informed to the 33% of the

employees.

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7. Have you faced any problems during process of performance

appraisal?

A – Yes

B – No

C – Partly


A 9 30%

B 12 40%

C 9 30%

Interpretation:

The above chart shows that 30% of the employees are facing

problems, 40% of the employees are not facing any problems and 30% of

the employees are facing some problems during the process of

performance appraisal.

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8. In your opinion performance appraisal in Coca-Cola is?

A – Very effective

B – Average

C – just a ritual


A 14 47%

B 10 33%

C 6 20%

Interpretation:

The above chart shows that performance appraisal is very effective for

47% of the employees, average for 33% of the employees and its just a

ritual for 20% of the employees.

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9. Is performance appraisal continuous process in Coca-Cola?

A – Continuous process

B – Just a formality

C – No match relevance is attached to continuing

D – Can’t say


A 11 37%

B 6 20%

C 7 23%D 6 20%

Interpretation:

The above chart shows that performance appraisal is a continuous

process for 37% of the employees, just a formality for 20% of the

employees, not a continuous process for 23% of the employees and 20%

of the employees can’t say about it in Coca-Cola.

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11. What mostly motive to best performance in Coca-Cola?

A – Working environment

B – subordinate performance

C – Encourage by superiors

D – All the above


A 11 37%

B 6 20%

C 7 23%D 6 20%

Interpretation:

The above chart shows that working environment for 37%,

subordinate performance for 20%, encourage by superiors and all these

for 20% of the employees are the mostly motive to best performance in

Coca-Cola.

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12. Are you satisfy with the functioning of rewards/recognition

mechanism at Coca-Cola?

A – Very high

B - High

C – Average

D – Below average


A 7 23%B 10 34%

C 7 23%

D 6 20%

Interpretation:

The above chart shows that 23% are satisfied very highly, 34% are

satisfied highly, 23% are satisfied average and 20% are satisfied below

average with the functioning of rewards/recognition mechanism in Coca-

Cola.

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13. On what basis Coca-Cola evaluating the performance?

A – Based on work

B – Based on quality of work


A 13 43%

B 17 57%

Interpretation:The above chart shows that Coca-Cola evaluates the performance

based on work for 43% of the employees and based on quality of work

for 57% of the employees.

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14. The prime objective of performance appraisal in Coca-Cola is?

A – Performance exists

B - Performance exists with job to evaluate

C - To determine promotion/transfer


A 14 47%

B 9 30%

C 7 23%

Interpretation:

The above chart shows that the prime objective of performance

appraisal in Coca-Cola is performance exists for 47%, performance exists

with job to evaluate for 30% and to determine promotion/transfer for 23%

of the employees.

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15. If given a chance will you change performance appraisal system in

Coca-Cola?

A – Total change

B – Partial change

C- There is no need of change


A 5 17%

B 14 46%

C 11 37%

Interpretation:

The above chart shows that if a chance is 17% will totally change,

46% will partially change and 37% wont change the performance

appraisal system in Coca-Cola.

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FINDINGS

1. It was found that feedback is given only to the some employees

after the appraisal process .

2. It was observed that the organization is helpful in improving their

performance.

3. It was found that the counseling programs are helping to improve

their skills.

4. It was found that the appraisal system is helpful in strengthening

work relationship.

5. It was found that the reward system is satisfying only few

members.

6. It was found that the employees are happy with the half-yearly

system of appraisal.

7. It was found that the appraisal is helping the employees to generate

new ideas.

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SUGGESTIONS

1. The company may design a one single format, arrange the

comments in such a way i.e. starting from down level to top-level.

2. Separate the forms of Customers/Vendors and Self Appraisal.

3. Arrange counseling programs to improve their skills.

4. Give feedback to the employees to develop their performance.

5. It is better to have separate Format at each level to avoid

influences.

6. Keep all the comments as confidential.

Success of implementation of appraisals depend on the

effectiveness of role of HR managers. It is not an easy task to implement

and maintain Performance Appraisals. For this the company have to

train all their personnel whoever involved in executing the Appraisals. In

the initial stage, the company take the help of out-side Consultants’ help

and expertise.

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CONCLUSION

Coca-Cola’s growth over the years reflects in the actualization of its

mission and it stands for the professional management of commercial

enterprise and its planned growth, through the effective use of knowledge

and resources at command to create substantial surpluses and contribute

to the quality office as a valued corporate citizen.

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