Title: Performance Appraisal Significance in the Software

Industries in India

Author:

Dr. Kiran Kumar Thoti, B.E, MBA, PhD, Sr. Asst. Professor, Sree Vidyanikethan Institute of Management, Sree Sainath Nagar, Tirupati- 517102, Andhra Pradesh, Ph: +91-9686261185, 9642176451, Email:kirankumar3561@gmail.com

ABSTRACT

Human Resource Management is a management function that helps

managers to Recruit, Select, Train and Develop members for an

organization. Performance appraisal may be understood as the

assessment of an individual’s performance being measured against

such factors as job knowledge, quality and quantity of output,

initiative, leadership abilities, supervision, dependability, co-

operation, judgment, versatility, health and the like. The

Performance Appraisal System needs to be very transparent and

helpful both to the employees and to the organization. The need

is to get a feedback from appraisers and appraises, working in

the organization, about the current state of the PAS. Only after

analyzing the current state of PAS, the human resource managers

can go to the next step of improvements in PAS. A survey is

therefore required. The type of research chosen is quantitative

in nature. The research is undertaken to ascertain the

views/opinions of the employees working with the company and to

suggest appropriate modifications about the existing PAS.

Structured questionnaire has been prepared and discussed

personally with the respondents. The sample size will be

restricted to 100 respondents chosen by applying stratified

random method. The methods adopted for the performance appraisal

were 360-degree appraisal, check list, rating scale, management

by objective etc. that are commonly found among the information

technology companies in Bangalore. The employees want their

appraiser to give the feedback to them.

Keywords: Performance Appraisal, Appraisal system, Human

resources, Human policies, Software Industries

INTRODUCTION:

An organization’s goals can be achieved only when people put in

their best efforts. How to ascertain whether an employee has

shown his or her best Performance on a given job? The answer is

Performance appraisal. Employee assessment is one of the

fundamental jobs of HRM, but not an easy one though. Appraising

the performance of individuals, groups and organizations is a

common practice of all societies. While in some instances these

appraisal processes are structured and formally sanctioned, in

other instances they are an informal and integral part of daily

activities. In social interactions, performance is conducted in a

systematic and planned manner to achieve widespread popularity in

recent years. In simple terms, performance appraisal may be

understood as the assessment of an individual’s performance being

measured against such factors as job knowledge, quality and

quantity of output, initiative, leadership abilities,

Supervision, dependability, cooperation, judgment, versatility,

health and the like. Assessment should not be confined to past

performance alone. Potentials of the employee for future

performance must also be assessed.

Meaning of performance appraisal:

Performance appraisal is the process of obtaining, analyzing and

recording information about the relative worth of an employee.

The focus of the performance appraisal is measuring and improving

the actual performance of the employee and also the future

potential of the employee. Its aim is to measure what an employee

does.

Definition of performance appraisal:

According to Edwin. B. Flippo” performance appraisal is the

systematic, periodic and an impartial rating of an employee’s

excellence in the matter pertaining to his present job and his

potential for a better job.” Performance appraisal is the

systematic way of reviewing and assessing the performance of an

employee during a given period of time and planning for his

future.

The other terms used for performance appraisal are:

Performance rating

Employee assessment

Employee performance review

Personnel appraisal

Performance evaluation

Employee evaluation

Merit rating.

In a formal sense, employee assessment is as old as mankind.

Features of performance appraisal:

i. Performance appraisal is the systematic description of an

employee’s job relevant strengths and weaknesses.

ii. The basic purpose is to find out how well the employees are

performing the job and establish a plan of improvement.

iii. Appraisals are arranged periodically according to a definite

plan.

iv. Performance appraisal is not job evaluation. It refers to

how well someone is doing the assigned job. Job evaluation

determined how much a job is worth to the organization and

therefore, what range of pay should be assigned to the job.

v. Performance appraisal is a continuous process in every large

scale organization.

Objectives of performance Appraisal:

To review the performance of the employees over a given

period of time.

To judge the gap between the desired and the actual

performance.

To help the management in exercising organizational control.

Help to strengthen the relationship and communication

between superiors, subordinate and management –employees.

To diagnose the strengths and weakness of the individuals so

as to identify the training and development needs of the

future.

To provide feedback to the employees regarding their past

performance.

Provide information to assist in the other personal

decisions in the organization.

Provide clarity of the expectations and responsibilities of

the functions to be performed by the employees.

To judge the effectiveness of the other human resource

functions of the organization such as recruitment,

selection, training and development.

To reduce the grievances of the employees.

Provide information to assist in the hr decisions like

promotions, transfers etc.

Provide clarity of the expectations and responsibilities of

the functions to be performed by the employees.

Need for performance appraisal:

Provide information about the performance ranks basing on

which decision regarding salary fixation, confirmation,

promotion, transfer and demotion are taken based on

performance in India Rayon.

Provide feedback information about the level of achievement

and behavior of subordinates. This information helps about

the level of achievement and behavior of subordinates. This

information helps to review the performance of the

subordinate, rectifying performance deficiencies and to set

new standards of work, if necessary.

Provide information which helps to counsel the subordinate.

Provide information to diagnose deficiency in employees

regarding skill, knowledge. Performance appraisals determine

training and developmental needs.

To prevent grievances and in disciplinary activities.

PROCESS OF PERFORMANCE APPRAISAL

Essentials or prerequisite of performance appraisal:

The essentials of an effective performance system are as follows:

Documentation: Means continuous noting and documenting the

performance. It also helps the evaluators to give a proof

and basis of their ratings.

Practical and simple format: The appraisal format should be

simple, clear, fair and objective. Long and complicated

formats are time consuming, difficult to understand, and do

not elicit much useful information.

Evaluation technique: An appropriate evaluation technique

should be selected; the appraisal system should be

performance based and uniform. The criteria for evaluation

should be based on observable and measurable characteristics

of the behavior of the employees.

Communication: Communication is an indispensable part of the

performance appraisal process. The desired behavior or

expected results should be communicated to the employees as

well as the evaluators. Communication also plays an

important role in the review or feedback meeting. Open

communication system motivates the employees to actively

participate in the appraisal process.

Feedback: The purpose of feedback should be developmental

rather than judgmental to maintains its utility, timely

feedback should be provided to the employees and the manner

of giving feedback should be such that it should have a

motivating effect on the employee’s future performance.

Personal bias: Interpersonal relationships can influence the

evaluation and the decisions in the performance appraisal

process. Therefore, the evaluators should be trained to

carry out the processes of appraisals without personal bias

and effectively.

Standards\goals: The goals set should be clear, easy to

understand, achievable, motivating, time bound and

measurable.

Challenges of Performance Appraisal

In order to make a performance appraisal system effective and

successful, an organization comes across various challenges and

problems. The main challenges involved in the performance

appraisal process are:

1. Determining the Evaluation Criteria

Identification of the appraisal criteria is one of the biggest

problems faced by the top management. The performance data to be

considered for evaluation should be carefully selected. For the

purpose of evaluation, the criteria selected should be in

quantifiable or measurable terms.

2. Create a Rating Instrument

The purpose of the performance appraisal process is to judge the

performance of the employees rather than the employee. The focus

of the system should be on the development of the employees of

the organization.

3. Lack of Competence

Top management should choose the raters or the evaluators

carefully. They should have the required expertise and the

knowledge to decide the criteria accurately. They should have the

experience and the necessary training to carry out the appraisal

process objectively.

4. Errors in Rating and Evaluation

Many errors based on the personal bias like stereotyping, halo

effect (i.e. one trait influencing the evaluator’s rating for all

other traits) etc. may creep in the appraisal process. Therefore

the rater should exercise objectivity and fairness in evaluating

and rating the performance of the employees.

Problems of performance appraisal:

The problem with subjective measure is the rating which is not

verifiable by others and has the opportunity for bias. The rate

biases include (a) Halo effect (b) The error of central tendency

(c) The leniency or strictness (d) Personal prejudice (e) The

recent performance effect.

Halo effect:

It is the tendency of raters to depend excessively on the

rating of one trait or behavioral consideration in rating

all others traits or behavioral consideration. One way of

minimizing the halo effect is appraising all the employees

by one rate before going to rate on the basis of another

trait.

The error of central tendency:

Some raters follow play safe policy in rating by rating all

the employees around the middle point of rating scale and

they avoid rating the people at both the extremes of the

scale. They follow play safe policy because of answerability

to management or lack of knowledge about the job and person

he is rating or least interest in his job.

The leniency or strictness:

The leniency bias crops when some raters have a tendency to

be liberal in their rating by assigning higher rates

consistently. Such ratings do not serve any purpose. Equally

damaging one is assigning consistently low rates.

Personal prejudice:

If the rater dislikes any employee or any group, he may

rate them at the lower end, which may distort the rating

purpose and affect the career of these employees.

The recent performance effect:

The raters generally remember the recent actions of the

employees at the time of rating and rate on the basis of

these recent actions favorable or unfavorable than on the

whole activities.

The other factors are considered as problems are:

Failure of the superiors in conducting performance appraisal

and post performance appraisal interview.

Most part of the appraisal is based on subjectivity.

Negative ratings effects interpersonal relations and

industrial relations system.

Influence of external factors and uncontrollable internal

factors.

Feedback and post performance interview must have a setback

on production.

Management emphasis on punishment rather than development of

an employee performance appraisal.

Some ratings particularly about the potential appraisal are

purely based on guess work.

Absence of inter-rater reliability.

The situation was unpleasant in feedback interview

Methods and techniques used for performance appraisal:

The various methods and techniques used for performance appraisal

can be categorized as the following traditional and modern

methods.

Traditional Methods of Performance Appraisal:

1. Essay Appraisal Method

This traditional form of appraisal, also known as “Free Form

method” involves a description of the performance of an employee

by his superior. This method requires the manager to write an

essay describing each employee’s performance during the rating

period. This is emphases evaluation of overall performance, based

on strength\weaknesses of employee’s performance rather than

specific job dimension.

Performance

appraisal

Essay method.Straight ranking method.Paired comparison method.Critical incident method.Field review method.Checklist method.Graphic rating scale.Forced distribution method.

Management by objective.360 degree appraisal.Assessment center.Behavioral anchored rating scale.Human resource accounting.

Traditional method

Modern method

2. Straight Ranking Method

This is one of the oldest and simplest techniques of performance

appraisal. In this method, the appraiser ranks the employees from

the best to the poorest on the basis of their overall

performance. It is quite useful for a comparative evaluation.

3. Paired Comparison

A better technique of comparison than the straight ranking

method, this method compares each employee with all others in the

group, one at a time. After all the comparisons on the basis of

the overall comparisons, the employees are given the final

rankings.

4. Critical Incidents Methods

In this method of performance appraisal, the evaluator rates the

employee on the basis of critical events and how the employee

behaved during those incidents. It includes both negative and

positive points. The drawback of this method is that the

supervisor has to note down the critical incidents and the

employee behavior as and when they occur.

5. Field Review

In this method, a senior member of the HR department or a

training officer discusses and interviews the supervisors to

evaluate and rate their respective subordinates. A major drawback

of this method is that it is a very time consuming method. But

this method helps to reduce the superior’s personal bias.

6. Checklist Method

The rate is given a checklist of the descriptions of the behavior

of the employees on job. The checklist contains a list of

statements on the basis of which the rater describes the on the

job performance of the employees.

A) Simple checklist method.

B) Weighted checklist method.

C) Forced choice method.

7. Graphic Rating Scale

In this method, an employee’s quality and quantity of work is

assessed in a graphic scale indicating different degrees of a

particular trait. The factors taken into consideration include

both the personal characteristics and characteristics related to

the on-the-job performance of the employees. For example a trait

like Job Knowledge may be judged on the range of average, above

average, outstanding or unsatisfactory.

8. Forced Distribution

To eliminate the element of bias from the rater’s ratings, the

evaluator is asked to distribute the employees in some fixed

categories of ratings like on a normal distribution curve. The

rater chooses the appropriate fit for the categories on his own

discretion.

9. Confidential Report:

Assessing the employee performance confidentially in a

traditional method of performance appraisal; under this method,

the superior appraise the performance of his subordinates based

on his observations, the judgment and intuitions. The superior

keeps his judgment and report confidentially in performance. The

superior writes the reports about his subordinates strengths,

weakness, intelligence, attitude to work ,sincerity, commitment,

punctuality, attendance, conduct, character ,friendliness etc.

most of the public sector organizations follow the same method.

10. Group Appraisal: Under this method, an employee is appraised

by a group of appraisers. This group consists of immediate

supervisors of the employee to other supervisors who have close

contact with the employees work, manager or head of the

department and consultant. The head of the department or

management may be the chairman of the group and the immediate

supervisor may act as the coordinator for the group activities.

The group uses any one or multiple techniques; this method is

widely used for the purpose of promotion, demotion and

retrenchment appraisal.

Modern Methods of Performance Appraisal:

1. Behaviorally Anchored Rating Scales

Behaviorally Anchored Rating Scales (BARS) is a relatively new

technique which combines the graphic rating scale and critical

incidents method. It consists of predetermined critical areas of

job performance or sets of behavioral statements describing

important job performance qualities as good or bad (for e.g. the

qualities like inter-personal relationships, adaptability and

reliability, job knowledge etc). These statements are developed

from critical incidents. In this method, an employee’s actual job

behavior is judged against the desired behavior by recording and

comparing the behavior with BARS. Developing and practicing BARS

requires expert knowledge.

2. Human Resource Accounting Method

Human resources are valuable assets for every organization. Human

resource accounting method tries to find the relative worth of

these assets in the terms of money. In this method the

Performance appraisal of the employees is judged in terms of cost

and contribution of the employees. The cost of employees include

all the expenses incurred on them like their compensation,

recruitment and selection costs, induction and training costs etc

whereas their contribution includes the total value added (in

monetary terms). The difference between the cost and the

contribution will be the performance of the employees. Ideally,

the contribution of the employees should be greater than the cost

incurred on them.

3. 360 Degree Feedbacks:

360 degree feedback, also known as 'multi-rater feedback', is the

most comprehensive appraisal where the feedback about the

employee’s performance comes from all the sources that come in

contact with the employee on his job. 360 degree respondents for

an employee can be his/her peers, managers (i.e. superior),

subordinates, team members, customers, suppliers/ vendors -

anyone who comes into contact with the employee and can provide

valuable insights and information or feedback regarding the “on-

the-job” performance of the employee.

360 degree appraisal has four integral components:

1. Self appraisal

2. Superior’s appraisal

3. Subordinate’s appraisal

4. Peer appraisal

4. Management by Objectives

The concept of ‘Management by Objectives’ (MBO) was first given

by Peter Drucker in 1954. It can be defined as a process whereby

the employees and the superiors come together to identify common

goals, the employees set their goals to be achieved, the

standards to be taken as the criteria for measurement of their

performance and contribution and deciding the course of action to

be followed. The essence of MBO is participative goal setting,

choosing course of actions and decision making. An important part

of the MBO is the measurement and the comparison of the

employee’s actual performance with the standards set. Ideally,

when employees themselves have been involved with the goal

setting and the choosing the course of action to be followed by

them, they are more likely to fulfill their responsibilities.

5. Assessment Centers:

Assessment centre refers to a method to objectively observe and

assess the people in action by experts or HR professionals with

the help of various assessment tools and instruments. Assessment

centers simulate the employee’s on-the-job environment and

facilitate the assessment of their on-the-job performance. An

assessment centre for Performance appraisal of an employee

typically includes:

Social/Informal Events – An assessment centre has a group of

participants and also a few assessors which gives a chance to the

employees to socialize with a variety of people and also to share

information and know more about the organization.

Information Sessions – Information sessions are also a part of

the assessment centers. They provide information to the employees

about the organization, their roles and responsibilities, the

activities and the procedures etc.

Assignments- assignments in assessment centers include various

tests and exercises which are specially designed to assess the

competencies and the potential of the employees. These include

various interviews, psychometric tests, management games etc. All

these assignments are focused at the target job.

Industry Profile: Over the last decade, India has developed into

a major and credible information technology (IT) outsourcing

centre. In India, the software boom started somewhere in the late

1990s. Most of the Indian software companies at that moment

offered only limited software services such as the banking and

the engineering software.

Information Technology (IT), a knowledge-based industry, has the

tremendous potential of becoming an engine of accelerated

economic growth, productivity improvement for all sectors of the

economy and means of efficient governance.

The IT software and service industry has been categorized into

three broad sectors:

o Software Product and Technology Services,

o IT Services, and

o IT Enabled Services.

It enhances access to information, protects consumers, provides

access to government services, makes skill formation and training

more effective, improves delivery health services, and promotes

transparency. It provides tremendous employment potential and

linkages between government and the people both at the rural and

urban level. Investment in knowledge based industries will

determine the level of the country’s dominant position in the

world economy in the next two decades.

The IT sector is one of the fastest growing segments of Indian

industry, growing from Rs. 13,200 crore in 1992-93 to Rs. 80,884

crore in 2008-09. Sixty per cent (Rs. 48,134 crore in 2008-09) is

accounted for by software and the remaining 40 per cent (Rs.

32,750 crore) by hardware. IT is an area where the country has a

competitive edge and can establish global dominance. Advancements

in IT have a profound impact on the economy and the quality of

human life. The ITES sector in India has emerged as a key engine

of growth for the Indian IT industry and the technology-led

services industry. This sector has grown from Rs. 2,400 crore in

1999-2000 to Rs. 4,100 crore in 2008-2009, providing employment

to 70,000 people. The major users of IT services are the

government, financial services and banking, manufacturing and

retail and distribution. New areas likely to emerge are

communication, healthcare and utilities, as these will

increasingly be deregulated. However, IT services essentially

require high-quality manpower, state of the art skills, world-

class telecom and IT-knowledge based environment.

Statement of the problem: This project aims to study the

performance appraisal system (by considering certain important

dimensions) followed in organizations today. The study aims to

highlight the significance of such performance appraisal system

in the corporate context. Thus the study tries to establish the

link between performance appraisal system and organizational

effectiveness.

Objectives of the study

To study performance appraisal system in the corporate

context

To highlight the significance of performance appraisal

system in the corporate context and establish the link

between performance appraisal system and organizational

effectiveness.

Need of the study:

Provide information about the performance ranks based on

which decision regarding salary fixation, confirmation,

promotion, transfer and demotion are taken based on

performance appraisal in the corporate context.

Provide feedback information about the level of achievement

and behavior of subordinates in the corporate context.

To provide information which helps to counsel the

subordinate

To prevent grievances and in disciplinary activities in the

corporate context.

Scope of the study:

To provide employees with a better understanding of their

role and responsibilities in the corporate context.

To increase confidence through recognizing strengths and

also identifying training needs to minimize weaknesses in

the corporate context.

To improve working relationships and communication between

supervisors and subordinates.

To increase commitment to organizational goals and to

develop employees into future supervisors in the corporate

context.

To assist in personnel decisions such as promotions or

allocating rewards.

Limitations of the study:

The study is constrained only to performance appraisal

system

The study is limited to the Bangalore city only.

Analysis of primary data is done on the assumption that the

answers given by the respondents are true and

correct.

Time and Resource constraints.

Type of Research:

Descriptive research: This research is the most commonly used and

the basic reason for carrying out descriptive research is to

identify the cause of something that is happening. 

The research is primarily quantitative in nature. The study is

based on data collected through structured questionnaire from the

respondents and interviews conducted with the respondents.

Sampling Technique/method:

The research technique used is Random Sampling method.

Sampling unit:

Hewlett Packard, Sonata software ltd, & Capgemini companies has

been selected as the sampling unit.

Data collection:

Data is the fact of an event. Data is the base for every research

work. The data is mainly classified into two groups.

1) Primary data: These data are gathered for our research

purpose. This is first hand information, for this purpose a

structured type of questionnaire was designed and administered.

2) Secondary data: Books, journals, websites etc., have been

consulted for obtaining related information, and also for

crosschecking of primary data.

Tools and techniques of data collection:

a. To get the response, the questionnaire method was used.

b. The questionnaire used in this study was a structured one.

c. Here the questions were arranged in a specific order and

were logically interconnected for the research study

d. The advantage of the structured questionnaire lies in the

reduction of bias.

e. Questionnaire containing of both open-ended questions and

close-ended questions.

Contact method: Personnel interview

The respondents were contacted personally interviewed them and

collected their views, opinions and suggestions given by them.

Sample Size:

The respondents used for survey and for certain conclusion, we

used 100 respondents who are working in the companies.

Sample procedure: The study required probability method since the

sample was chosen at random. Hence the study was dealt

with simple random tool.

Plan of analysis:

Calculations have been done for interpretation such as

percentage, averages etc. This report has been covered with

various tables; graphs and charts obtained from sources such as

questionnaires and personal interview etc. The data collected

through the questionnaire are organized, processed and tabulated

in order to create graph and charts to make the project

understandable.

DATA ANALYSIS:

97%

3%

The response towards the awareness of the performance appraisal system.

YesNo

From the above graph it can be interpreted that the employees are

well aware of the performance appraisal system followed in the

company.

10%

80%

10%

Response towards the level of satisfaction

Fully satisfiedPartially satisfiedNot satisfied at all

This shows that the present performance appraisal system is

satisfactory to some extent. Further improvement in the system

can be made in order to attain full satisfaction of the

employees/executives of the company

82%

18%

Response towards awareness about different traits

YESNO

From the above graph it can be interpreted that the managements

effectively inform the appraise about the traits contained in the

appraisal formats.

95%

5%

Knowledge about reporting officers

YesNo

From the above graph it can be interpreted that the employees are

aware of their Reporting officers.

I Year 6 months 3 months01020304050 46%

22%32%

Response towards frequency of performance appraisal

From the above graph it can be interpreted that the many

employees prefer annual performance appraisal system.

28%

19%6% 31%

16%Response towards application of performance appraisal

Promotions Salary Retention/Termination

Recognition of individual performance

Identification of Poor performers

From the above table out of 100 respondents 58% of the employees

agreed that performance appraisal system helps in promotions, and

for 39 of the employees agreed that it helps in salary, for 12%

of the employees agreed that it helps in retention, and for 63%

of the employees agreed that it helps in Recognition of

individual performance, and for 32% of the employees agreed that

it helps in identification of poor performers. From the above

graph it can be interpreted that the Performance appraisal

influences promotions and also aids in recognition of individual

performances.

040

47% 28% 11% 14%

Response towards the appraiser in the organisation

From the above table out of 100 respondents 47% of the

respondents are rated by peers. While 28% of the employees are

appraised by subordinates and 11% of the respondents by clients

and 11% of the respondents are appraised by self. From the above

graph it can be interpreted that most of the employees are rated

by peers and rest of the employees is rated by subordinates,

client and few people are rated by self.

1 2 3 4 5 6010203040

20% 20%30%

0%

20%10%

Response towards the appraisal system followed in the company

From the above table out of 100 respondents 20% of the employees

are agreed that Graphic rating scale is one of the method used by

the company for doing evaluation and other 20% of the employees

preferred 360 degree performance feedback and other 30% of the

employees rated BARS and other 10% of the employees agreed MBO

and only 10% of the employees preferred other methods of

evaluation. From the above graph it can be interpreted that the

MBO and BARS are preferred techniques of evaluation

38%

55%

6% 1%

Responses towards sufficiency of help and guidence provided by reporting/

reviewing officersHighly sufficient sufficientInsufficient Highly

Insufficient

From the above table out of 100 respondents 38% of the employees

are in the opinion that help and guidance provided to them by

their reporting/reviewing officers is Highly sufficient, and for

55% it is sufficient, and for 6% of the employees it is

insufficient and for only one employee it is highly insufficient.

From the above graph it can be interpreted that the Help and

guidance provided to employees by their reporting/reviewing

Officers is sufficient.

42%

41%

11%6%

Relationship between PA and pay

Highly Co-related

Co-related

Not related Don’t know

From the above table out of 100 respondents 42% of the employees

are in the opinion that the close relationship between their

performance appraisal rating and corresponding monetary reward is

highly co-related.and for 41% it is co-related, for 11% of the

employees it is not related and for 6% of the employees are

don’t know about that. From the above graph it can be interpreted

that there is a high close relation between performance appraisal

and corresponding monetary reward.

Very high Quite high

Quite low Very low02040

46% 39%

11% 4%

Response towards degree of mutual undestanding

From the above table out of 100 respondents 26% of the employees

agreed that the degree of Mutual Understanding in their work

relationships with their supervisor is very high and for 39%

employees it is quite high and for 11% of the respondents agreed

that it is quite low and for only 4% of the employees it is very

low. From the above graph it can be interpreted that the degree

of mutual understanding in work relationships with the employee’s

superior is very high.

FINDINGS

1. From the study it is found that 97% employees are aware of

the performance appraisal system followed in the company.

2. It is found from the study that 80% of the employees are

partially satisfied with the PAS followed in the

organization.

3. From the study it is found that 87% of the employees are

satisfied with the Self-Appraisal process being followed in

the company.

4. It is found from the study that 82% of the employees are

aware of the different traits or attributes according to

which they are rated.

5. From the study it is found that 95% of the respondents are

know about their reporting officers.

6. It is found from the study that 65% of the respondents

agreed that the present appraisal system should be reviewed.

7. From the study it is found that the many employees prefer

annual performance appraisal system.

8. It is found from the study that 63% of the employees agree

that performance appraisal system helps in Recognition of

individual performance.

9. From the study it is found that 47% of the employees are

rated by peers.

10. It is found from the study that 30% of the employees

are agreed that BARS is one of the method used by the

company for doing evaluation.

RECOMMENDATIONS

1) The performance appraisal should begin by concentrating on

what employees have done well.

2) The Reporting officer must focus on employee’s key

effectiveness areas where he should show results.

3) The Reporting/Reviewing officer must establish objectives in

terms of an employee’s performance (Both short –term and

Long-term), which in a way will affect the total

organizational plan.

4) The reporting officer and the reviewing officers can hold

discussions with the employees and help the employee set up

objectives and goals relating to employees’ performance.

5) The HR manager should give continuous feedback reviews to

the employees about their performance. These feedbacks can

be in the form of discussion of the performance, performance

counseling etc.

6) It is desirable to link the performance appraisal systems

with employees reward and recognition programs and the

impact of PAS should be gauged on these programs.

CONCLUSIONS

From the study, it can be concluded that if, the organization

implements new performance appraisal system it may enhance

employees effectiveness. It may help in identifying his or her

strength and weakness and information the employees as to what

performance is expected from them, would go a long way in making

one stand his/her role clearly, and is expected to be more

effective on his job. Performance appraisal system in the

corporate context today seems to be highly satisfactory .Most of

the employees is satisfied with the existing system. Performance

appraisal system is found to be highly significant in the

corporate context. The researcher is able to establish link

between Performance appraisal system and organizational

effectiveness.

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