CHAPTER – 1

INTRODUCTION

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 INTRODUCTION

From an organizational point of view, evaluating the performance of staff is an indispensable

and achieving organizational goals and missions (Amiri, 2016). Performance appraisal
determines the knowledge and feedback and identifies the strengths and weaknesses of the
organization’s performance and position in a turbulent and fraught environment. In addition,
performance management organizes individual and organizational behaviour and improves
performance at lower to upper levels of the organization (Amiri, 2017).

Research findings suggest that organizations with efficient and effective performance
management have higher profits, better financial turnover, and higher productivity. Improving
individual and organizational performance is key to success in competition. Evaluating the
performance of the individual and the organization helps managers to control the extent to
which with all employees in order to know thirteenth which organizational goals are being met.
This requires them to properly design jobs, select right and well-trained people to take on
organization positions, reward them appropriately for achieving the organization's strategic
goals, and thus provide the necessary motivation.

Performance management provides a strategic link through their evaluation and audit, in order
to become aware of the skills, abilities, knowledge, and behaviour of employees. In this way,
senior management learns about how to meet the current and future needs of their organization
and receives appropriate feedback on the alignment of employee behaviour toward the
achievement of goals, and whether individuals meet the requirements for achieving
organizational goals (Amiri, 2016). Do people feel satisfied that they contribute to the
achievement of the goals? and encourage the behaviours required to achieve strategic goals and
progress? And does the organization foster a good organizational culture? What is Performance
Management? Almost every organization has a kind of performance management system that
is expected to meet important goals in human capital to management. These goals are:
Motivating people to perform well; Helping people develop their skills; Creating and
strengthening organizational culture; Determining who is eligible for promotion; Deciding who
has poor performance; Helping to implement business strata The performance of any
organization is subject to the performance of that organization's human resources and their
interaction with the resources, facilities, and technology available in the organization. On the

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other hand, the performance of human resources depends on their motivation and ability. Also,
the ability of human resources is itself subject to job knowledge and skill in applying that
knowledge in performing tasks and activities. In addition, human resource motivation depends
on the attitude of the employees and the conditions and situations in which they work.

Performance management can be defined as the process by which these functions are
implemented in the organization. In other words, performance management is a set of policies
and measures that achieve goals by focusing on individual performance. Timing: Some
managers think that evaluation plans take their time. While the evidence suggests that even if

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a single-page evaluation form is available to them, they refuse to complete it. Inappropriate
training: Lack of proper training, in addition to the limitations mentioned above, will lead to
other errors such as discrimination between staff, the impact of the evaluator-evaluator
relationship, emphasis on subjective performance criteria, and so on. Step by step model of
performance management Usually in most performance management models, the four -stage
Deming model includes planning and targeting, continuous implementation and monitoring,
control of strengths and weaknesses, and feedback and ultimately performance analysis and
review.

Step One: -
Planning and targeting to set performance standards for normative planning and achieving
appropriate performance indicators, it is best to first perform a "job analysis" as a central source
of organizational business information. After collecting job information and summarizing it,
prioritizing and deriving performance criteria for each job is done. Key performance metrics
include a set of general criteria, as well as some specific metrics with respect to job categories,
4the nature of jobs, and so on. Next, we need to determine the means of measuring each of the
performance indicators and their scope and weight.

Step Two: -
Performing assessment, continuous monitoring, tracking, coaching and performance
measurement once goals and plans are clarified and agreed upon, managers and supervisors
should supervise, support, guide, train, delegate, and provide feedback as instructors. During
the evaluation period, the manager must understand, evaluate the work requirements and
responsibilities, provide feedback, and advise the employee on how to change and improve his
or her behaviour and performance in the direction of successful implementation of the
programs and achievement of goals. In addition, management and supervisors should assist the
coach in their role of reviewing and responding to each action and learning of their behaviours
and behaviours. (Coaching is a flexible and nurturing process based on mutual agreement
between two people, with the coach continually giving feedback on how to improve
performance and enhance individual abilities.)

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Step Three: -
Control the strengths and weaknesses of the standard and provide feedback the third step in the
process is to integrate employee performance management, evaluating their behaviour and
performance, in comparison to the goals and expectations that have already been agreed and
identified, along with identifying their strengths and weaknesses. The key to the success of the
phase of work is that employees trust managers and accept the results of this evaluation. It
should be noted that there is a potential for error in evaluating employee behaviour and
performance, as with any human activity or activity. In fact, evaluating is one of the most
difficult and complicated things managers do.

Step Four: -

Analyse and review performance and remedies and explain individual and group improvement
plan. The last stage of the employee performance management process, which somehow
completes the process and gives it a managerial nature, is reviewing employee performance and
taking corrective actions to improve performance in future planning periods After conducting
the necessary evaluations and completing the performance appraisal form of his staff, which
reflects the strengths and weaknesses of the employee and his successes and failures, the
manager should analyse and review his performance and behaviour in a face - to - face meeting
with the employee and make important decisions together. Doing so will improve both
employee and organization performance and success. In order for the performance cycle to be
completed and to be able to manage and improve the performance of the job, this cycle must be
constantly in place and constantly reviewed, redefined, and improved for each period. In this
way, we can drive the business cycle and put the organization on the path of development and
improvement. Who are they evaluating? One of the important points in formulating a
performance appraisal system is the evaluation of appraisers. In fact, once the evaluation criteria
and tools have been identified, we must select the evaluators based on the evaluation approach
and with regard to organizational maturity. In most organizations, the evaluation is done by the
direct management or supervisor of the employee. The evaluation may also be done by the
individual himself or by a special committee or even his or her colleagues and subordinates.

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Assessment by supervisor or manager: -

In many organizations, the process of performance Appraisal is performed by supervisors.

Given the close the working relationship between supervisors and staff as well as the degree of
skill and expertise, the supervisor's view of their supervisors is a good source for evaluation.

Self - Evaluation: -

Individuals can be said to be the best person to evaluate their performance if they are aware of
their duties, performance standards and standards, supervisor expectations, and organizational
goals. Self -assessment requires that individuals rate themselves based on their attributes and
capabilities and comment on their performance. Of course, these comments can be exaggerated
at times.

Peer - to - peer evaluation: -

Peer-to-peer evaluation is rarely done in organizations. However, it is one of the most reliable
sources of information in evaluation. Peers, like careers, are familiar with the job requirements of
the individual being evaluated and have a great opportunity to observe the work behaviours of their
colleagues, so they can play an evaluative role. Peer assessment is trustworthy if teamwork takes
place over a long period of time and the tasks assigned need to have a relative response and
response.

Subordinate Evaluation: -

This type of evaluation is used in organizations with comprehensive quality system, as they are
constantly seeking improvement. The most important advantage of subordinate evaluation is
that organizational policymakers gain a better understanding of supervisor’s communication
skills, general staff desires, and the ability to provide the resources needed. One of the
disadvantages of this approach is that many employees consider this type of assessment an
opportunity to gain points, and some see it as an opportunity to compensate for past injustices.
In sum, most employees evaluate their supervisors based on their organizational strength and
not their actual performance.

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Evaluation Committees: -

Evaluation committees are set up to evaluate individuals' performance to reduce some biases
and possible biases in individual evaluation. This committee consists of managers and
supervisors who comment on the staff they work with. This method requires the cooperation
and close communication of supervisors who are familiar with employee behaviour.

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PERFORMANCE MANAGEMENT POLICIES: -

A performance management policy frames a structure for all the people working under a
company to agree and review the goals and objectives within the context of the company’s
overall development plan and their individual development needs.

1. Discipline Appeals Policy.

2. Equal Opportunity, Non-discrimination, and Anti-Harassment Policy.

3. Awards Policy.

4. Employee Benefits Program.

5. Faculty & Staff Assistance Program (FSAP).

6. Worker's Compensation.

7. Flex work Arrangements.

8. Training and Development.

 The policy should assist in developing the people working under the company and help,
wherever necessary, to raise the standards of achievement for them.

 A performance management policy needs to be clear about certain aspects such as – the
procedure involved in drafting it, the implementation of such procedure, the assessment
of the result of such implementation, and finally the review of the assessment. It is a
connected process and thus is required to be approached systematically.

 An effective performance management policy takes into consideration, the company’s

business goals and the employee’s personal goals, based on them both, a framework is
given. Such amalgamation results in a better understanding between the company and
the employee.

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 Since performance management encourages companies to recognize and reward the
efforts of the employees, there is an increase in employee retention and employee
loyalty It also encourages bridging the communication gap between the managers and
the employees.

 A performance management policy creates a healthy environment to regularly review

and understand the skill set of an employee. This provides clarity on the areas upon
which an employee might need training. This helps in the professional development of
the employee and also prevents the company from facing any sort of drawbacks in the
future.

 A proper performance management policy leads to the sustainable development of the

company. Consistent engagement along with the issuance of constructive feedback
helps the company in being up - to - date with its requirements and shortcomings. This
helps in structuring future goals and contributes to the achievement of the objectives
laid down by the company.

 To achieve job satisfaction, an employee must feel that he plays a pivotal role in the
development of the company. A performance management policy can do so by
completely engaging the employee. Job satisfaction boosts the productivity of an
employee and benefits the comp.

 Elements of a Performance Management Policy: -

The following are the key elements of a Performance Management Policy-

1. Goal Setting (practical goals as per the needs of the company).

2. Allocating Roles (describing the roles of each individual working in the
company).

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 Drafting a performance management policy effectively: -

While drafting a Performance Management Policy for a company the following points must be
considered –

 IDENTIFY THE GOAL OF THE POLICY: -

As you are drafting a performance management policy, you must first question yourself about
what you want the policy to achieve. Various aspects get involved in a policy such as the
development of the company, retention of the employees, streamlining the finance, etc. Sorting
out such questions will make it easy for you to recognize the goals of the policy.

 ALLOCATING AND DESCRIBING EACH ROLE: -

Through the performance management policy, you can improve the capabilities of an employee
by describing their role to them in a clear manner. Often the employee gets confused as to what
exactly he is supposed to do and this hinders his professional growth as well as the company’s
growth. Allocating defined roles will help in avoiding this issue.

 SETTING UP A FRAMEWORK WHERE PERFORMANCE MEETS

GOALS: -
In the first step you have already set goals that your policy needs to achieve, now, they must be
achieved with the help of the performance of an employee. A proper plan describing the
expectations of the company and how an employee will achieve them will be beneficial to the
company. It will also make sure t hat the employee meets such goals regularly.

 PRACTICAL MEASUREMENTS FOR PRACTICAL GROWTH: -

The progress of the employees towards achieving the goals set by the company must be
monitored in a systematic way which involves the use of metrics. This helps in ruling out the
areas where the employees lack knowledge or skill an action can be taken to improve in such
areas and accelerate their professional growth.

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 MANAGEMENT AND COACHING: -
It does not make any sense to identify the drawbacks and not provide a solution for it.
Employees should get consistent yet constructive feedback and coaching to perform and engage
well with the assigned work.

 INCREASED FOCUS ON DRIVING RESULTS: -

With the help of an effective performance policy, the employees work every day to achieve the
goals of the company. This enhances the productivity of both the company and the employee.

 SHARED ACCOUNTABILITY: -
Employee engagement of a company can be improvised by creating a nurturing work
environment of shared accountability which helps in the development and the career growth
of the employee.

 MULTIPLE SOURCE FEEDBACK: -

Developing a culture of providing feedback for each other among the employees will help them
in understanding the challenges and performance-based problems faced by them together as a
team. This will also help in building peer-loyalty among them.

 PROVIDE SOCIAL RECOGNITION FOR PERFORMANCE OF

EMPLOYEES: -
Acknowledging the achievements of the employees in a public manner will make them feel
valued and recognized for the work and efforts they put in achieving the goals of the company.
This also helps a lot in employee retention.

 INVOLVING EMPLOYEES IN DESIGNING THE PERFORMANCE

MANAGEMENT POLICY: -
For a performance management policy to be effective and engaging, it must be viewed by the
employees as an object which considers their interest. It means that a company must take the
opinions of its employees while drafting a performance management policy.

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 Implementing a Performance Management Policy

There are 4 steps involved in implementing a Performance Management Policy effectively

STEP 1 – SET GOALS

This helps in establishing performance standards for the employees and provides work
accountability and its objectives. In this manner, you can create a development plan.

STEP 2 – OBSERVE
This helps in gaining insights on how the employees through their performance are giving a
shape to the goals set by the company. The provision of constructive feedback along with
updates and resources must be done at this point.

STEP 3 – ASSESS

Evaluation is imperative when it’s about the progress or development of the employee.

An assessment that involves appropriate parameters will provide the results of the employee
and about their performance or underperformance. A proper way to assess performance is
through appraisal forms.

STEP 4 – REVIEW

Sharing feedback with the employee will not constitute a review. You must provide the
employee with clarifications as to which goals you expect them to achieve next or explain
where the employee performed well or poorly and how it can be done right. Based on the
performance experience of the employee, set the objective and goals for the upcoming term
accordingly.

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 PERFORMANCE MANAGEMENT OBJECTIVES AND STANDERDS: -

The main objective of performance management is to enhance the: Achieving individual

employee goals of employees along with organizational objectives. Also, enhance the skills
and personal development of employees through the managers' help. Additionally, encourage
work that helps in fulfilling business goals.

 Chances are that your company performance is not as good as it should have been. Also, your
existing performance management system is doing nothing to elevate employee performance.
 Does this mean that you should ditch your present system? Well, not quite so.

 Instead of kicking your performance management system to the curb, just revamp it.

 But do you know the first step in forming a performance management system that actually
works?

Objectives Of Performance Management System:-

Here are the 5 primary objectives of performance management systems:

1) Setting and defining goals to fulfil company objectives: -

Goal setting is the most lucrative way for initiating better performance among employees. It
has been constantly indicated that practical goal setting:
o Allows employees to focus on what's important.

o Aligning individual objectives with the business objectives.

o Optimizes employees' individual performance.

o Helps to identify the key result areas and work upon improving them.

A good performance management system will put goal setting as one of its main conditions.

As a manager, set goals that benefit both- employee performance and business performance.

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2) Setting the right expectations for managers and employees: -
An efficient performance management system sets clear expectations from both managers and
employees. As a manager, you must place achievable expectations from your employee. Don’t
expect a poor performer to give good results right away. Or a star performer to stay consistent
every other week. Similarly, holding managers to high expectations will only bring in poor
management decisions. To set expectations that'll actually bring in some results:

o Define the expectations of your employees in clear terms. Let employees know what
your expectations are from them.

o Back up the reasoning behind the expectation. Explain how these expectations will
help in fulfilling the business objectives.

o Document expectations. Don't let it be a word-by-mouth interaction. Have a specific

spreadsheet or document about what to do and who handles it. Use a tool such as Air table
or pick one of the many Air table alternatives that'd be a better fit for your business,

3) Effective communication between individuals and teams: -

o Changing workplace dynamics is bringing a cultural shift to today's workplace.

Consequently, communication has played an essential part in it.

o Good communication practices result in employees who are engaged and happy. It also
ensures a smooth alignment of individual objectives with business objectives.

o Team members must know their peers' goals, succession planning, and ideas— to work
well together.

o A team that lacks communication among its team members lacks the bonding needed in a
high performing team.

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 Some tips for building an active communication environment: -

 Firstly, team leaders or managers should take out the time to indulge in one-on-one
interactions with the team members.

 Continuous feedback and coaching form a workforce with varied skills by encouraging
career development. One way to do this is through performance appraisals or performance
reviews.

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 Additionally, conduct frequent team-building activities.

 Promote collaboration and communication as an essential part of your workplace culture.

 Also, use appropriate and helpful business communication.

4) Set performance standards: -

Performance stan the most important objectives of performance management are to set
performance standards. Setting the right performance standards can help you build a better
performance plan. It, in turn, makes for a smoother evaluation of employee performance. Every
job has specific performance standards that have to be met. Failure to accomplish A lack of
effort on the employees' part.

o Usually having set more unrealistic standards for the said job.

o Meanwhile, not enough resources were available to complete the task.

o In particular, a failure of cooperation or collaboration from the team or manager.

 Here's the thing: -

You might never know what the reason for failure is without any performance management
System. A good performance management system can highlight what's lacking and what
deserves credit. The company's strengths and weaknesses will be more clear and hence easier
to rectify.

5) Determining individual training and performance plans: -

o Another vital objective of performance management systems is to identify the training and
development needs of its workforce.

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o It promotes personal growth and advancement in the employees' careers by helping them
acquire the desired knowledge and skills.

o A successful performance plan offers personal growth opportunities for your people. Your
people will be more confident and contribute better.

o Here's how you can create an effective employee performance plan to foster career
development:

o Firstly, ask your employees what skills, training, or course they require to do great work.

o Then create a training plan and budget.

o Additionally, decide how the new training skills be applied in revamping old methods.

o Lastly, set up some organizational objectives to apply these newfound skills.

 PERFORMANCE APPRAISAL PROCESS: -

A performance appraisal is a systematic and periodic process of measuring an individual's work

performance against the established requirements of the job. It's a subjective evaluation of the
employee's strengths and weaknesses, relative worth to the organization, and future
development potential.

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1) Establishing performance standards: -

The first step in the process of performance appraisal is the setting up of the standards which
will be used to as the base to compare the actual performance of the employees. This step
requires setting the criteria to judge the performance of the employees as successful or
unsuccessful and the degrees of their contribution to the organizational goals and objectives.
The standards set should be clear, easily understandable and in measurable terms. In case the
performance of the employee cannot be measured; great care should be taken to describe the
standards.

2) Communicating the standards: -

Once set, it is the responsibility of the management to communicate the standards to all the
employees of the organization. The employees should be informed and the standards should be
clearly explained to the employees. This will help them to understand their roles and to know
what exactly is expected from them. The standards should also be communicated to the
appraisers or the evaluators and if required, the standards can also be modified at this stage itself
according to the relevant feedback from the employees or the evaluators.

3) Measuring the actual performance: -

The most difficult part of the Performance appraisal process is measuring the actual
performance of the employees that is the work done by the employees during the specified
period of time. It is a continuous process which involves monitoring the performance
throughout the year. This stage requires the careful selection of the appropriate techniques of
measurement, taking care that personal bias does not affect the outcome of the process and
providing assistance rather than interfering in an employee’s work.

4) Comparing actual performance with desired performance: -

The actual performance is compared with the desired or the standard performance. The
comparison tells the deviations in the performance of the employees from the standards set.
The result can show the actual performance being more than the desired performance or, the
actual performance being less than the desired performance depicting a negative deviation in

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the organizational performance. It includes recalling, evaluating and analysis of data related to
the employees’ performance.

5) Discussing results: -

The result of the appraisal is communicated and discussed with the employees on one-to-one
basis. The focus of this discussion is on communication and listening. The results, the problems
and the possible solutions are discussed with the aim of problem solving and reaching
consensus. The feedback should be given with a positive attitude as this can have an effect on
the employees’ future performance. Performance appraisal feedback by managers should be in
such way helpful to correct mistakes done by the employees and help them to motivate for
better performance but not to demotivate. Performance feedback task should be handled very
carefully as it may leads to emotional outburst if it is not handing properly. Sometimes
employees should be prepared before giving them feedback as it may be received positively or
negatively depending upon the nature and attitude of employees.

 Managing Underperformance and Discipline: -

Employees can be a company’s greatest asset or its biggest liability, depending on how they
carry out their responsibilities. In fact, underperforming employees can undermine your
organization’s performance. Learn what causes employees to underperform and how to manage
underperforming employees and increase their productivity. Underperformance is a common
predicament among employees of all levels, and each instance has unique aspects. Knowing
how to handle these situations with a consistent approach can prevent them from inhibiting
your team’s productivity.

 Taking the following steps can help you address workplace under

performance: -

1. Recognize that there is a problem.

2. Conduct a meeting and ask questions to establish what causes the employee to underperform

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3. Reiterate job expectations.

4. Manage employee expectations.

5. Develop an action plan together.

6. Ensure regular check-ins and follow-ups.

7. Recognize progress.

8. Practice performance coaching.

9. Provide feedback.

10. Retain thorough documentation.

11. Make a decision if performance doesn’t improve.

12. Encourage a healthy work-life balance.

 Reward and remuneration strategy: -

Performance and reward strategies are driven by the concept that employees are not inherently
born with the desire to come to work and put in their maximum effort every day for no reason
at all. Thus, employers motivate and maximize employee performance via the implementation
of a reward system. An effective performance and reward strategy aligns with organizational
goals and objectives. A total rewards strategy is a system implemented by a business that
provides monetary, beneficial and developmental rewards to employees who achieve specific
business goals. The strategy combines compensation and benefits with personal growth
opportunities inside a motivated work environment. Designing and implementing a total
rewards strategy requires a large-scale approach that drives organizational change. Top
executive and management buy-in are critical for the success of a total rewards strategy. Your
project team should be made up of decision-makers as well as front-line employees to ensure
that your approach is well-rounded and fits the needs of everyone at the table. If you operate in
a union environment, it is important to understand that collective bargaining may affect the
implementation of your strategy.

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 Development plans and learning and development activities: -

A performance development plan is a tool for improving employee performance. The PDP
process helps managers and employees identify areas for improvement, set goals, measure
progress, and outline a strategy to achieve those objectives. Performance development planning
is usually held quarterly (coinciding with regular quarterly performance reviews), allowing
employees and their managers to track progress and make adjustments as needed. The
development planning process empowers employees to direct their personal and professional
development within the organization. It is a valuable tool for both managing and correcting
performance as well as stretching your team and inspiring growth. The positive effects of
including learning and development in performance management the old-school idea that HR’s
role is exclusively to hire and manage talent is no long relevant. Today, we understand that HR
professionals can play a huge part in developing their company’s talent, taking a people-first
approach that benefits individual team members and the organization as a whole. One core HR
task that can benefit from this approach is performance management. As the job market opens
up and the competition for talent increases, keeping employees happy and productive is
important. That’s why creating an effective performance management strategy is key to the
health of your organization. Leaders need to continuously coach, develop, and support their
employees in their performance. But navigating this modern approach has proved difficult for
some. To ease your struggles, here are a few productivity-boosting performance management
ideas.

 TYPES OF PERFORMANCE MANAGEMENT SYSTEMS

General Appraisal This is the type of performance management were, communication between
the manager and the employee happens throughout the year, and at the end of the year, the
manager and employee will determine if the pre-set goals and objectives were met, provide
feedback and set new goals. (Uma, 2013). The general appraisal performance management
system allows the manager, set goals for employees, measure, evaluate and draws feedback on
to employees on how they performed.

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360 DEGREE A 360-degree appraisal is a type of employee performance review in which
subordinates, co-workers, and managers all anonymously rate the employee. (Uma, 2013)

360-degree appraisal has four integral components. Self-appraisal, was an individual will be
given the rights to measure their performances, according to what they think, they performed.
Secondly, one of the superiors/supervisors will rate individual performance. Thirdly,
subordinates, measures and evaluate the employee performance. Finally, employee peers’ rate
individual employees’ performances. (Arunima, S.V.D & Nageswara, 2014)

The 360 degrees, helps employees feel free as an individual and as an organization from being
held hostage by the views of your boss. This appraisal helps managers identify, employees,
behaviours, and overall contribution to the organization, by, looking at the ratings from, the
supervisor and peers. (Steven, 2011).

Employee Self-Assessment The employee is given a chance to assess himself/herself on

how they think they performed, after completion of the individual assessment, the manager,
then compares the assessment of the individual employee and his/ hers. In case of any huge
differences, a meeting will be set for the manager to speak to the employee. The self-evaluation
process helps employees to explore their own talents and also allows employees to flourish and
produce their talents in front of management. HR help board, (2017). Self-assessment helps
employees seriously consider their level of performance and contribution towards the
organization. (Susan, 2019)

Manager Performance Appraisal Managers go through the appraisal process. Most

often the manager appraisal process includes feedback from the respective team members and
sometimes from the client as well. Uma, (2013). Employees evaluate, their manager, or
supervisor. Therefore, there are a variety of performance management systems in the world.
The 360 degree is more convenient than others, because of the four stages it has.

 Principles of Performance Management

Some of the major principles of performance management are as follows:

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1. Performance management is considered a process, not an event. It follows good management
practice in which continual coaching, feedback and communication are integral to success.

2. The Performance Management is primarily a communication tool to ensure mutual

understanding of work responsibilities, priorities and performance expectations.

3. Elements for discussion and evaluation should be job specific – not generalized personality
traits. The major duties and responsibilities of the specific job should be defi ned and
communicated as the first step in the process.

4. Performance standards for each major duty/responsibility should be defi ned and
communicated.

5. Employee involvement is encouraged in identifying major duties and defi ning performance
standards.

6. Professional development should be an important component of the plan.

7. The formal evaluation period should be long enough to allow for full performance and to
establish a history such that evaluations are fair and meaningful. One year is a common
evaluation period.

8. Documentation of performance will occur as often as needed to record the continuum of

dialogue between supervisor and employee.

9. If formal ratings are included, they should reflect the incumbent’s actual performance in
relation to the performance standard for that major duty.

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10. The supervisor should be evaluated on the successful administration of the plan and ongoing
performance management responsibilities.

11. Training for supervisors and employees is encouraged and will be provided by University
Human Resource Services.

 Ten Top Performance Management Tips

1. Talk to your people often in order to head-start performance management of your people.

2. Keep formal discussions friendly and simple.

3. Be very positive and do not spend extended time on the weaknesses of employees.

4. Help employees achieve their needs.

5. Build feedback in as a natural activity.

6. Be honest in a working relationship for everyone’s benefit.

7. Remember that performance management is not an instrument to manage indiscipline.

8. Notice great performance and celebrate successes.

9. Have an uncomplicated and time-bound system of performance management.

10. Learn from mistakes.

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CHAPTER – 2
LITERATURE REVIEW

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 LITERATURE REVIEW

1) According to Study by DDI (1997), Performance Management Practices is most

recent performance management study. It proves that successful organizations realize that
performance management is a critical business tool in translating strategy into results. The
CEOS in the majority of the 88 Organizations surveyed say their performance management
system drives the key factors associated with both business and cultural strategies.
Performance management systems directly influence five critical organizational outcomes:
Financial performance, productivity, product or service quality, customer satisfaction &
employee job satisfaction. When performance management systems are flexible & linked
to strategic goals, organization are more likely to see improvement in the five critical areas:
team objectives, non- manager training, appraiser accountability & links to quality
management are the specific practices most strongly associated with positive outcomes.

2) Watkins (2007) puts it, most public sector business organization like those in Delta State
of Nigeria have not given adequate attention to performance management review as a tool
for improving performance even when recent studies suggest that performance review
benefit organizational performance in both private & public sectors. Performance
management has been described as a systematic approach to the management of people,
using performance goal measurement, feedback and recognition as a means of motivating
them to realize their maximum potentials. Public sector business organizations that strive
to deliver quality services at competitive prices are those that embrace various performance
review practices to assess their employee performance & motivate them with incentives.

3) Robert & Angelo (2001). The success or failure of public sector business organization
depends on the ability to attract, develop, retain, empower & reward a diverse array of
appropriately skilled people and is the key to improving organizational performance. The
explanation therefore is that human resource managers in the public sector business
concerns should embark on periodic performance management reviews of their employees

27
 in order to re - position their business organizations though owned by government for better
performance & improved competitiveness.

4) Study by Wm. Schliemann & Associates (1996), this national survey of cross -
section of executives concluded that measurement-managed companies- especially those
that measure employee performance- outperform those that downplay measurement. This
research studied 122 organizations making between $27 million and $50 billion in sales. A
higher percentage of measurement-managed companies were identified as industry leaders,
as financially in the top third of their industry, and as successfully managing their change
efforts. The research examined performance in six strategic performance areas deemed
crucial to long - term success: Financial performance, operating efficiency, customer
satisfaction, employee performance, innovation / change, community / environment. The
findings revealed that the biggest measurement area separating successful from less
successful firms is employee measurement. Successful industry leaders simply do a better
job than non-leaders at measuring their workforce, which the study say is where real change
won or lost.

5) Study by Hewitt Associates, (1994), The impact of performance management on

organizational success substantiates that performance management system can have a
significant impact on financial performance and productivity. The study used the Boston
Consulting Group/HOLT financial database to track the financial performance of 437
publicly held U.S. companies from 1990 through 1992. The study results showed that:
Companies with performance programs have higher profits, better cash flows, stronger
stock market performance and a greater stock value than companies without performance
management. Productivity in firms without performance management is significantly
below the industry average, while productivity in firms with performance management is
on par with the industry average. Companies with performance management significantly
improved their financial performance and productivity after implementing performance
management.

28
6) Williams, (2002) identifies globalization, increased competition and the increasingly
individualistic rather than collective employee relationship as some of the major drivers
contributing to the increased visibility of performance management systems (PMS). Faced
with fast moving and competitive environments, companies are constantly searching for
unique ways in which to differentiate themselves from their competition and are
increasingly looking to their "human resources" to provide this differentiation.

7) Timmons, (1992) had opined that competitiveness is a major issue in foreign

competition, and if a country's export promotion drive is to yield the desired results.
competitiveness in particular must be optimized. He further posited that the declining
productivity in business organizations which leads to un-competitiveness is a major cause
of monetary problems and inflation, and governments obviously should be interested in the
level of competitiveness arising from productivity improvement. Although, the use of goal
setting is primarily used to improve performance, there are other benefits such as: to clarify
expectations, to improve job satisfaction, to enhance self-esteem through attainment of
goals and to improve quality of work (Locke and Latham 1984). Appraisal provides the
mechanism to provide effective feedback on achievement of which is an important factor
in improving performance (Williams 2002).

8) Fletcher, (2004) describes it as a "high risk activity" for managers, given the many
pitfalls associated with it and Newton and Findlay (1996) highlight the fallibility of
appraisals as they are open to manager manipulation. Despite the criticisms, the use of
performance appraisal is widespread and perceived to be an effective part of a performance
management system (CIPD 2005a).

9) Gratton, (1996) There has been a change in scope of the appraisal process in recent
years, with an increasing focus on employee development, as more and more businesses
focus on how targets are achieved rather than just the achievement itself This has led to a
combination of both objectives (outputs) and competencies (inputs, Taylor, 2005) and the
recognition that personal development planning (PDPs) is a fundamental part of a PMS. By

29
 offering employees the opportunity of enhancing their skills through training, levels of self-
confidence will improve and performance will be enhanced (White 1999).

10) Wilcoxson (2000) High performance is considered to be achievable in different ways,

two of which are the humanistic and rational process perspectives. According to proponents
of the humanistic perspective, high performance is attributed to investment in the softer
people aspects of organizational life. Through valuing, trusting. developing and
empowering employees, encouraging cooperative modes of operating and stakeholder
engagement, organizations can achieve high performance.

11) Whittaker and Marchington, (2003) found evidence in their study that line
managers spent very little time on people management issues, preferring instead to
concentrate on financial or business objectives. Hope Hailey et al (2005) report that line
managers are only measured on their technical role and not their people management
responsibilities. The appraisal process is therefore of secondary importance to them and the
appraisal is generally approached with little preparation, training or enthusiasm (Cook and
Crossman 2004, Holt Larsen and Brewster 2003). To address this, Hendry et al argue that
not only should line managers own the performance management process but that they
should be involved in its design, and only by involving them at this stage will they "buy-
in" to the process. Lack of management "buy-in" can potentially frustrate the whole purpose
of a performance management system, leading to an inability to meet short-term goals as
well as failure to address longer term developmental opportunities (Weeks, 2005).

12) Loehr, (1981) had stated that even Abraham Taylor (1856-1915) widely regarded as the
father of Scientific Management in his legendary thesis on performance improvement in
organizations had recognized the negative influences of groups on performance and sought
to break-up informal group activities through spatial and work-flow designs and individual
piece rate systems of pay. Taylor had based his management system on production-line
time studies. Instead of relying on traditional work methods, he analysed and timed
steelworkers ‘movements on a series of jobs. Using time study as his base, he broke each

30
 job down into its components and designed the quickest and best methods of performing
each component (Idemobi et al 2010).

13) The paper of Jawaria Andleeb Qureshi, Assad Shahjahan, Zia – Ur - Rehman and
Bilal Afshar (2010) notifies that many organizations install Performance Management
Systems formally and informally in their organizations, with the motivation to achieve
better organizational results. In practice, organizations have difficulty in implementing a
performance management system because its different dimensions are not taken into
considerations enough. This article describes the findings of a comparative analyses
conducted between a standard performance management model and performance
management systems as applied by Local Development Organization (LDO). Data was
collected from 50 employees of the organization with a Cronbach Alpha (0.935). Results
identified barriers to implementation of effective PMS, also recommendations and viable
solutions are presented.

14) Robert and Angelo, (2001) The success or failure of public sector business
organizations things on the ability to attract, develop, retain, empower and reward a diverse
array of appropriately skilled people and is the key to improving organizational
performance The explanation therefore is that human resource managers in the public sector
business concerns should embark on periodic performance management reviews of their
employees in order to re position their business organizations though owned by government
for better performance and improved competitiveness.

15) Sung & Ashton, (2005) It is the business strategy that gives the high-performance
working practices their dynamism and provides the framework against which performance
can be evaluated and improved. Thus, the concern is not with the specific type or number
of practices employed, but the way they are linked to organizational performance.

31
16) Results from the Watson Wyatt Worldwide (2004) study suggest that PM
systems should recognize high performers and confront poor performers as soon as
possible. eliminate paper forms, and utilize a user-friendly automation. Researchers from
Watson Wyatt Worldwide also assert that if PM systems are designed and implemented
properly, they can lead to positive impact on individual performance as well as better
financial results for the organization (Le, improvement in shareholder value).

17) A common weakness in the implementation of performance management systems

noted by de Waal is the focus only on the " structural side ", that is, "the structure that needs
to be in place to be able to use performance management such as critical success factors &
key performance indicators, possibly supported by a balance scorecard". De Waal argues
that successful implementation also requires attention to the "behavioural side" that is, the
necessary performance-driven behaviour required from organizational members to achieve
the desired objectives According to de Waal (2004), appropriate behaviours, including
attitudes and beliefs, depend on a range of factors including management style, the
perceived relevance of performance.

18) A study conducted by McDonald and Shield of Hewitt Associates found that
companies that used performance management programs had greater profits, better cash
flow, stronger stock market performance and greater stock value than companies that did
not. Not only performance management improved financial performance, but it also
improved productivity; companies with such programs had higher sales per employees.
Nonetheless, performance management has been mistaken as performance evaluation. As
a matter of fact, both performance management and performance evaluation are related but
they are not exactly the same concept. Performance management is a systematic process
for improving organizational performance by developing the performance of individuals
and teams; it is a mean of getting better results from the organization, teams, and individuals
by understanding and managing performance within an agreed framework of planned goals,
standards, and competence requirement (Armstrong, 2006). While performance evaluation
is a process of assess and rate past performance of individuals or groups (Oct 2004).
Performance evaluation is just a part of performance management.

32
19) K. Chandhana and Dr. David T Easow (2015) in their article titled ‘Performance
Appraisal Method Used in Top 10 IT Companies – 360 Degree Feedback & Balanced Score
Card: A Review’ has found that the both 360degree feedback and balanced score card has
its own loopholes, through these methods are being used by top IT companies. The
satisfaction levels of employees towards these appraisal methods are very low and there is
a need of a new appraisal method which prevents these errors and has the advantages of
these methods.

20) Rajput, et al, (2015) in their article titled ‘Performance Appraisal System’ explain that
performance appraisal is conducted on an annual basis for existing employees whereas for
trainee and new recruits it is done on quarterly basis in many organizations. Here author
studies about the multidimensional nature of job where the nurse manager gives rating to
different job of nursing process. Thus, Employees who have relatively less competition or
lenient appraisers have higher appraisal than to equally competent employee.

21) Rinku Sanjeev and Sanjeev Kumar Singh (2014) in their article titled ‘Employee
Perception towards Performance Appraisal Program in Packaging Industry’ suggest that
the employees have both positive and negative perceptions towards the Performance
Appraisal Programme in packaging industry. The employees also believe that it is not
helpful in reducing grievances among the people. Employees’ perceptions also vary
according to their demographic differences. The Performance Appraisal Programs need
transparency and well explained parameters for the acceptance and satisfaction of
employees as this impact the overall organisational performance.

22) Anbarasu Thangavelu and Dr. J Clement Sudhahar (2014) Performance

Management Challenges in IT Industry – An Overview’ conclude that the performance
management system for a large IT organisation should be designed to measure the past and
potential performance of its employees and its own performance in alignment with the
states vision of the organization. Jawad et al., (2014) ‘Impact of Technology on
Performance of Employees (A Case Study on Allied Bank Ltd, Pakistan)’found that the
investment of organizations in new technology has good impact on the performance of

33
 employees; it increases their efficiency and productivity. It also makes the organizations
more competitive regarding customer services like in the case of Allied Bank, it become
more customers focused and services oriented.

23) Bethuel Sibongiseni Ngcamu (2013) ‘The Empirical Analysis of Performance

Management System: A Case Study of a University in South Africa’ concluded that the
Performance Management System (PMS) to be effectively implemented flexible PMS
needs to be designed in order to accommodate all employees at all levels. It further
recommends that in order for the PMS to improve effectiveness amongst employees; well-
crafted job descriptions in line with departmental strategic plans that are aligned with the
comprehensive organisational strategy; need to be brought to light.

24) Rohan Singh, Mad humita Mohanty and Mohanty A.K. (2013) ‘Performance
Appraisal Practices in Indian Services and Manufacturing Sector Organisations’ concluded
that the conducting periodical review of workforce performance by organizations has
become a fundamental requirement which will help to shrink the gap between employee
performance and successful attainment of its objectives.

25) Muhammad Shaukat Malik and Suraya Aslam (2013) ‘Performance Appraisal
and Employee’s Motivation: A Comparative Analysis of Telecom Industry of Pakistan’ this
empirical research found the significant influence of employee’s reactions towards
performance appraisal on employee motivation. Employee perceived reactions including
perceived satisfaction, perceived acceptability, perceived utility, perceived fairness and
perceived accuracy of performance appraisal are significantly important to determine the
employee work motivation.

26) Hamumokola (2013) ‘The Contributions of Performance Management Systems To

performance in The Namibian Context’ found that the goal setting theory which predicts
that performance benefits can be realized by implementing specific challenging goals

34
 because they have a motivational effect on employees compared to vague and easy goals.
He suggested that employee participation in goal setting and providing feedback led to
higher performance compared to when goals assigned and no feedback is given.

27) Rajesh K. Yadav and Nishant Dabhade (2013) ‘Performance Management

system in Maharana Companies (a leading public Sector undertaking) of India – A Case
study of BHEL, Bhopal (M.P.)’ suggested that the effective performance management
requires equal standards against which employees are assessed. In the absence of equal
standards, employees are assessed with subjectivity, which may destroy the process of
appraisal and leave it as a body without soul. Therefore, the problem of unequal standards
can be minimized by ensuring that the appraisal criterion is job-oriented.

28) I.M. Jawahar (2006) ‘Correlates of Satisfaction with Performance Appraisal

Feedback’ indicates that the performance appraisal feedback is the primary impetus for the
organization effectiveness and it investigates potential predictors and consequences of
satisfaction with appraisal feedback. Appraisal feedback was positively related to job
satisfaction of the employees, organizational commitment and negative related to turnover
intentions.

29) Bard Kuvaas (2006) ‘Performance Appraisal Satisfaction and Employee Outcomes:
Mediating and Moderating Roles of Work Motivation’ explained that the alternative
relationships between performance appraisal satisfaction and employee outcomes in the
form of self- reported work performance, affective organizational commitment and
turnover intention. The relationship between performance appraisal satisfaction and work
performance, however, was both mediated and moderated by employees’ intrinsic work
motivation. The form of the moderation revealed a negative relationship for employees with
low intrinsic motivation and a positive relationship for those with high intrinsic motivation.

30) Sharmistha Bhattacharjee and Santoshi Sengupta (2011) ‘An Employees

35
 Performance Management in Manufacturing Sector in India’ stated that the employees are
the most valuable and dynamic assets of an organization. Through the performance
management system can leads to achieving the strategic objective of sustained & speedy
growth, managing human resource has been featured as a vital requirement in all
organizations.

31) Talya and Berim (2010) explained that the performance appraisal system is not only
an important tool of human resource management to develop their employees, but is also
used by different companies to reward their employees in form of bonuses, promotions, and
pay raise etc. Usage of performance appraisal to reward employees is also used by different
theories of motivation like reinforcement theory etc.

32) Ashok Khurana & Kanika Goyal (2010) ‘Performance appraisal: A key to HR
assessment and Development’ explored the performance appraisal practices of selected
Indian Industries. It provides an insight into the concept of performance appraisal, the
method and approaches of performance appraisal, the appraisal process etc. The study
observed that at L&T performance of human resources is appraised at three levels. That is
self-appraisal by employee reviewing his past performance, critical attributes appraisal by
immediate supervisor and performance and development planning for future period by the
superior along with the employee. The study observed that performance appraisal is
indispensable to be aware of each employee’s abilities, competencies and relative merit and
worth for the organization.

33) Geeta Kumari, Neha Kaleramna and K.M.Pandey (2010) ‘Study on

Performance Management System of Private Companies: A Case Study of Endurance Pvt.
Ltd. Maharashtra, India’ suggested that the performance targets must be clear, specific,
challenging, time bound and linked with value rewards and employees must be properly
and adequately communicated regarding the assigning of values in terms of number of
performances.

36
34) Sanwong (2008) ‘The Development of a 360-Degree Performance Appraisal System:
A University Case Study’ examined the functioning of an innovative 360-degree
performance appraisal system among a sample of 75 employees at a Thai university. The
data for the system came from supervisors, colleagues, clients and junior staff as well as
from the employees themselves. The validity of the system was examined on two occasions.
While all employees were satisfied with the system, support and clerical staff in the
university were more satisfied than academic staff. A number of suggestions were made for
improving the 'working' of such a system in a university environment.

35) Gurbuz and Dikmenli (2007) in their research titled ‘Performance appraisal in public
organizations: An empirical study’ they suggest that younger as well as older employees’
perception of Performance Appraisal generally does not vary significantly according to
their ages. This apparently suggests that younger and older employees alike are
substantially similar in terms of their commitment and willingness to submit to
Performance Appraisal.

36) Kuvaas (2006)‘Performance Appraisal Satisfaction and Employee Outcomes:

Mediating and Moderating Roles of Work Motivation’ explained that the performance
appraisal is one of the most important theories of human resources management and is one
of the subjects which have been studied and investigated in the psychology of work
extremely. Those employees who believe that the organization is trying to supply their
needs may have a sense of responsibility with regard to render to the organization through
high work performance.

37
CHAPTER – 3
RATIONALE
OF
STUDY

38
 RATIONALE OF STUDY

1. Use technology, particularly for cascading goals.

2. Help employees achieve their needs.

3. Set company objective.

4. Evaluate performance.

5. Reward performance.

6. Awarding hardworking employee.

7. It helps with goal setting.

8. Helping implement business strategies.

39
CHAPTER – 4

OBJECTIVE OF
STUDY

40
 Objectives of study

 To study the process and to understand the importance of Performance Management

System performance of the employees so as to make the work effective.

1) To analyse the Performance Management System, and its effectiveness.

2) To analyse the problems faced by the appraisee and the appraiser in this system.

3) To analyse the steps taken by the appraisers for the improvement of the performances of the

appraisees.

41
CHAPTER – 5
RESEARCH
METHODOLOGY

42
 RESEARCH METHODOLOGY

 Research Design: -

1) Que. What is the study about?

Ans. Study is about defining Performance management system.

2) Que. Why is the study being made?

Ans. Performance management system is critical for talent management. PMS is critical in
strengthening employer expectations. Study being made to identify how strong PMS impacts key
HR processes viz compensation and benefits, training and development, recruitment and
selection.

3) Que. Where will the study be carried out?

Ans. This study will be carried out at L&T (EW AC). Sample will be drawn from all the
departments,

4) Que. What type of data is required?

Ans. This study will require primary data and secondary data. Data collection will done by
designing appropriate questionnaire and conducting semi structured interviews.

43
 TYPES OF DATA COLLECTION

 Primary Data: -

"Primary data is that which is collected fresh and for the first-time primary data is also called

basic data or Original data."

- Through Questionnaire.

- Through Interaction with Employee.

 Secondary Data: -

"Secondary data means data that which has been used previously for any research & now is use
or the second time."
- Through Magazines.

- Through Industrial Documents.

- Through Website of Industry.

 Analysis Technique: -

Random Sampling and Questionnaire technique selected by researcher to collect the data from

the respondent.

44
CHAPTER – 6
DATA ANALYSIS OF
PERFORMANCE
MANAGEMENT
SYSTEM

45
 DATA ANALYSIS

The future of performance management includes both data analytics and employee feedback.

Rather than relying upon scheduled reviews spaced far apart, companies should use ongoing

reviews, feedback and “check-ins” to offer more engagement on a real-time basis. A

combination of manager and HR assessments with peer reviews can offer better engagement

and give workers the tools and information they need to do their jobs well. It will also motivate

them to improve on their weaknesses and capitalize on their strengths.

While data analytics is an integral part of effective performance management, this is merely a

tool of enhanced performance management. Employee engagement and trust comes from

human interaction and ongoing feedback that uses data to enhance accuracy, objectivity and

efficiency. The human touch is still an important part of the process, and managers and HR

personnel must continue to personally interact with workers to offer guidance, support,

feedback and information.

Performance appraisals are notoriously unpopular with employees, manager s and HR

personnel, although usually viewed as a necessary evil. There are several reasons for this

attitude.

Poor Dynamic: -

The practice of having managers or HR personnel sit in what appears to be a position of

“judgment” over employees sets up an unproductive dynamic. The worker often feels
defensive, and the process may foster a sense of conflict rather than the team environment the
company desires. Inadvertent Bias: It’s difficult for managers to provide honest feedback when

46
the words are less than complimentary. Plus, tying these reviews to financial compensation can
make it more difficult to rate the employee’s performance without bias.

Inaccuracy: -

Subjectivity and accuracy are frequently a problem with the numeric rankings or ratings that
periodic performance reviews rely on. The system needs standardization and reliable metrics to
ensure objectivity and accuracy.

Prolonged Process: -

This is a lengthy, unwieldy process that requires a huge block of time from managers and HR.
detracting from other important job roles and detrimentally impacting productivity. A 2014
Deloitte University study revealed that percent of companies surveyed view reviews as an
unproductive use of time.

Inadequate Feedback: -

This outdated approach fails to give employees timely feedback that is so essential to
supporting employee satisfaction and retention. It also fails to capture and reflect real - time
performance, which offers more opportunity for improvement and growth.

47
1. Do you get any formal feedback regarding your performance.

Interpretation: -

70% of employees think that the current system (e-Map) is better than the previous system

(ACR) because earlier their result was totally confidential and was not known to them. This

shows the good inter personal relationship between the appraisee and the appraiser. More than

half of the employees are satisfied with the present performance appraisal system

48
2. Do you think the present system is effective / better than the previous
appraisal system?

Interpretation: -

70% of employees think that the current system (e-Map) is better than the previous system

(ACR) because earlier their result was totally confidential and was not known to them. They

can control the performance of their subordinates. completely elaborated and they are given

choices to choose among many of their calibres. they can control the performance of their

subordinates.

49
3. Do you find these steps effective / useful in your job?

Interpretation: -

65% executive feels that these steps are useful as the develop their skills and competencies.

Executives say that the proper training is given to them for upgrading their job whenever

Required earlier their result was totally confidential and was not known to them.

50
 On the management side, organizations still need the key ingredients for
success: -

51
On the analysis side, organizations need to deepen the bench of analytical skills in government
across multiple dimensions, which means attracting 21st century talent and using modern tools
and techniques. Data is everywhere, and accessing it is cheaper and easier than ever. But
analysing it requires these competencies to turn insight into foresight:

52
CHAPTER – 7

MAJOR FINDINGS
AND DISCUSSION

53
 MAJOR FINDING’S

 Some Interesting New Findings Related to Performance Management: -

• Factors such as objectives setting, incentives and rewards have been re-designed in such a
way that benefits the organization, employee and employer.

• As Deloitte, the biggest accounting firm in New York, states, “The redesign of performance
management is picking up speed: 79 percent of executives rate it a high priority, up from
71 percent three years ago, with 38 percent calling the problem ‘very important’”.

• The need for the Performance Management revolution now exists is because of the
changing nature of our work.

• Organizations are now much more interested in feedbacks by employees than they were
before. Conversational feedbacks have replaced metric - based assessment that particularly
aims to increase the performance output by employees; ultimately, leading to the progress
of organizations.

• According to a survey by CEB research, 49 % of HR leaders have eliminated or are

considering eliminating ratings with feedback becoming the core of performance
management. Not only this, but the feedback process has become much easier and shorter,
being taken on a quarterly or annual basis.

• The fact that manager overlooks the performance and maintains a relationship with
employees help to maintain the ideal feedback cycle.

54
 Short Term Goals: -

Companies have now started to set short term goals, thinking it as a better way to redesign
business landscape. According to HR Influencer, Josh Bersin, “companies that set performance
goals quarterly generate 31 % greater returns from their performance process than annual ones,
and monthly performance goals give even better results”

 Two Important Systems: -

The book, Computers in Industry, states that, “The basic requirements for a successful
Performance Management system are two frameworks—one structural and one procedural as
well as a number of other performance management tools. Inter-organizational performance
measurement may be divided into supply chain and extended enterprise performance
measurement: the former relying solely on traditional logistics measures, while the latter
incorporates the structural aspects of the supply chain system and adds non-logistics
perspectives to its measurement arena.” Non-logistics performance pertains to the discussions
capabilities and skills that must be taught to employees enabling them to develop important
skills for better performance management. Removing any form is bias while promoting,
appraising, giving any raises leads to a much better work environment. Deloitte clearly
mentions the continuous performance management technique adopted by big companies that
have raised performance management.

 Management Capabilities: -

Several case studies conducted by Cornell University have shown that despite positive feedback
implementing regular feedbacks, many companies face an initial decline. Furthermore,
companies must invest in management capabilities and many companies still have a long way
to go in adapting to this frame shift. It states, “From early observations, unintended
consequences include increased costs and time needed to build manager capabilities, costs of
developing and implementing technology platforms to supplement new systems of
performance review, and possibly legal risks that companies may face without having
quantifiable performance management data.”

55
It is wise to discuss new system implementation before letting old style employee rating
reviews go. New systems need to be easy to handle and focus on feedback in a broader
perspective rather than rating the employee.

 Key Factors of an Effective Performance Management System: -

Human resource department is continuously trying to improve processes to enhance employee

engagement and growth, retain employees, hire new talent, and operate more efficiently on a
day-to-day basis. Performance management software is one of the best solutions that
organizations use to simplify and speed up the appraisal process along with performance
reviews, providing appropriate feedback to employees. There are some key factors of a
performance management system that works for any organization to improve the overall quality
of the performance management process.

Here, we present a few essential components of business performance management

software: -

1. Setting Proper Goals and Objectives: -

Clear objectives and goals for each employee is the most crucial step that boosts both
employees as well as organizational productivity. Clearly, state the performance objectives and
plans. If your intentions are unclear and confusing, then it is evident that employees tend to
lose interest. At the beginning of the year managers need to meet their employees and define
goals clearly and plan various ways on how employees can fulfil their goals and accomplish
positive outcomes.

2. Succession Planning: -
Employee engagement, benefits, and their satisfaction can help with the attrition rates. There
are very few employees who keep working in the same organization for their entire life.
Employee mobility is a significant problem that organizations face today and must manage the
carefully. Succession planning makes sure that when employees switch to their next job, the
skills that have made them so good gets transferred to other workers.

56
3. Providing Granular Insights: -

An effective performance management system should give the managers granular insights that
can be utilized for employee evaluation. Information essential to take employee specific
decisions are required through an easy-to-use dashboard or reporting tool.

4. Real-time Feedback: -

A performance management software aids in creating a culture of communicating about team

objectives, training and development, and more. Real-time feedback keeps employees
motivated and provides the opportunity to boost themselves continuously instead of waiting for
the next performance review. Employers can continuously monitor employee progress from
time-to time and provide suggestion whenever required on their performance instead of waiting
until the annual review process. With the above features, the right performance management
system will help you to build a robust environment of trust throughout the entire organization
and gives you the performance support that you need.

57
 DISCUSSION

Employee performance reviews provide helpful feedback about employees' strengths and areas
for improvement. Performance reviews typically take place annually and may include a oneon-
one meeting with a manager or supervisor. These types of conversations are a great way for
employees and their managers to talk openly about job skills and career growth. Performance
reviews can be a great opportunity to get feedback from employers about your skills and
abilities. Regular performance reviews are important because they can help you learn how to
improve your skills and become more productive. Employers can also benefit from
performance reviews by gaining insight into individual experiences and concerns.

 To show initiative, consider discussing ways you think you can improve in the future. This
can show employers that you're self-aware and open to having a conversation about
constructive feedback.

 If you've recently gotten better at a specific skill, talk about how you've progressed.
Consider talking about how you've grown as an employee and what knowledge you've
gained since the last performance review.

 You can also ask questions about future expectations during your performance review.
Consider discussing both personal and company - wide expectations to prepare for the
upcoming year.

 Talk about your experience in the workplace and mention any questions or concerns you
may have about day-to-day tasks. Employers often appreciate insight into individual
employee experiences so they can adjust their expectations and goals to better fit their
needs.

58
 If you're interested in being promoted or taking on more responsibility, let employers know
during your performance review. Employers may reference past performance reviews to
gauge your level of commitment and to remember specific strengths and/or skills.
 Showing interest in a follow-up meeting can show employers you're diligent and
determined to improve. Because performance reviews only happen once or twice a year,
asking for a follow-up meeting can help you stay up-to-date and engaged in your work.

 Performance reviews can be an appropriate place to ask for a raise as you discuss your skills
and abilities. Consider politely asking for a raise if the opportunity arises.

 Performance reviews provide employers with the opportunity to understand what it's like
to work for their company on a day-to-day basis. Consider sharing relevant observations
about company culture, productivity or organization.

59
CHAPTER – 8
CONCLUSION
AND
SUGGESTION

60
 CONCLUSION

In conclusion, performance management system can only be realized if it is accompanied by a

good communication plan which demonstrates the purpose of the system, how the employees

will benefit, clarity on job responsibilities, standards and goals and importantly how the

employees and the organisation will benefit.

A performance management system helps leaders continuously track and

coach employee performance. Not only do these systems ensure that employees are working

effectively toward aligned organizational goals, but they help leaders develop their talent

toward optimal performance.

The process of Performance Management therefore drives organisational performance

outcomes. Employees that achieve the organisational goals are rewarded with favourable

reviews and bonuses in line with their performance and contribution to the organisation.

In conclusion, the performance management system that the firm intends to implement will

enable it to satisfy the expectations of its stakeholders in the long run. The firm will follow all

important phases that are related to the new strategy to ensure the system is aligned to the long-

term vision that guides its operations in the industry. More importantly, performance

management systems implemented by the firm will focus on opening up decision making

processes to enable employee to develop their professional skills in the long term. As result,

this will allow employees to contribute the long-term success of the organisation by proposing

valuable ideas which will improve the quality of results attained.

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 SUGGESTIONS

Change isn’t easy for people or organizations. Often, we get used to the way things are and
resist changing them even if they’re not working very well. In deceases, an intervention is
called for. And that’s the case with Performance Management. Traditional employee
performance management has not always been as effective as it should be, but you can change
your performance management plan to deliver greatly improved results. If you’re ready to make
the move to improve performance management, it might seem like an overwhelming task—but
it doesn’t have to be. Focus on one improvement at a time and before you know it, you’ll see
impressive results. Here are some ideas and best practices to consider.

 Put Frequent Feedback First: -

As we’ve said, old-school annual reviews aren’t enough. Employees prefer and respond better
to frequent, ongoing feedback. Consider what mixture of semi-annual formal reviews, quarterly
progress reviews, monthly one - on - ones, and weekly check - ins would work best in your
organization. Keep things simple so they don’t require too much time. Even informal chats in
the break room can help managers and leaders learn what’s on employees’ minds and build
relationships with them. Annual reviews can still have their place as a summary of the year’s
feedback and the results of performance goals.

 Give Formal Review Questions a Tune-Up: -

Conventional performance appraisal questions like, “How valuable is this employee on a scale
of one to ten?” are too subjective. Imagine the difference if you instead asked, “What would
you do if this employee were offered a job elsewhere?” Questions like this, which require
thought, can produce more insightful and objective answers than asking for numbers that might
mean different things to different managers. You can also improve your questions by
considering what you want the review to accomplish. For example, is it about evaluating
performance, fostering development, or both? What employee qualities are most important to

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measure? Align your questions with your organization’s objectives and your employees’
interests.

 Separate Performance Appraisals from Compensation Discussions: -

When traditional annual reviews are used to determine pay raises, it can throw a wrench into
the conversation. Employees may be tempted to say whatever they think will get them a raise
instead of answering questions honestly. What’s worse, that pressure to pad numbers may not
even be necessary; many managers award or withhold raises based on how much money is left
in the budget, not the employee’s performance. Take the pressure of salary negotiation off the
table, and you’ll get more honest answers that will let you use reviews to help employees
actually become better workers.

 Focus on the Future: -

To avoid the trap of unproductively dwelling on the past, Gallup recommends using coaching
conversations to collaborate with employees on what’s happening now, what needs to happen
next, and how to get there. Set clear expectations for behaviour and performance and explain
how success will be measured. Use open, honest, and ongoing two-way dialogue to help
employees feel heard and understand how their future actions can best align with company
objectives. Managers may need formal training to sharpen their coaching skills.

 Build on Strengths: -

It pays to accentuate the positive. Research shows when managers focus performance
discussions on employee weaknesses, performance declines by 27 percent. But if they focus on
employee strengths instead, employees show a 36 percent improvement. This doesn’t mean
ignoring weaknesses; it simply means you’re likely to see better results and happier employees
when you first help them build on their strengths. If you must give negative feedback, be as
specific and objective as possible and let them know you believe in their ability to improve.

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 Help Employees Grow: -

In the LinkedIn Workplace Learning Report, 94 percent of employees say they would stay at a
company longer if it provided great learning and development opportunities. Find out what
your employees want to pursue and learn, and then give them a pathway to do so. Set and track
realistic achievable goals. Give them added responsibilities and training to help develop their
careers. Look for opportunities to fill internal needs with people you already have by
developing employees for key roles.

 Choose the Right Software: -

Good performance management software can help you automate processes, optimize reporting,
analyse data, and strategize for the future. But there are many software platforms to choose
from, and it’s essential to find one that’s a good fit for your needs and future growth. The theory
that underpins our Performance Management software is that reviews have a bigger impact
when they’re relevant to what’s going on in employees’ daily work. Making them easier and
more frequent takes some of the weight off the experience, which allows employees and
managers to communicate more openly.

 Ensure the executive team is modelling goals to your workforce: -

“It’s not enough to set goals and issue edits from on high,” says O’Farrell. “Your entire
executive team must model the goals to the rest of the organization throughout the year”. So
whatever executives are asking of department heads and line managers, they need to be doing
those things as well. For example, if you’re expecting all managers to give positive and
constructive feedback on a regular basis, executives should be doing the same with their direct
reports.

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 SOME MORE SUGGESTIONS

 Start slow, ideally with a single department.

 Use technology, particularly for cascading goals.

 Apply what you learn with continuous performance management to end-of-year

reviews. Keep it simple.

 Use technology to gain insights and identify issues early.

 Start thinking ahead in terms of your broader ecosystem.

 Train managers and employees alike to develop buy-in.

 Let the new process drive rewards and recognition.

 Always look for improvement.

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CHAPTER – 9
REFERENCES

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 REFERENCES

 COMPANY‟S MANUALS

 Performance Appraisal by Joyce Margulies.

 Indiana university http://www.indiana.edu/-uhrs/.htm

 http://appraisals.naurihub.com

 http://hr.rpi.edu/update.com

 http://www.performance-appraisal.com

 Business knowledge source on job evaluation by Steve M.jex.

 Handbook of Applied Behaviour’s Analysis. John Austin & James E. carry.

 Management of Human Resources, Gary Dressler

 Peter Drucker, “Management task, responsibilities, practices.

 The practice of management‟. By Peter Drucker.

 http://performance –appraisal.org/experts/perffeedback.htm

 https://www.whatishumanresource.com/performance-appraisal-process

 https://www.ascenderhcm.com/what-is-performance-management

 https://lashkar.in/suggestions-to-improve-performance-management-system

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CHAPTER –10
APPENDICES

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 APPENDICES

1. Are you satisfied with the present performance appraisal system (E-map)?

(a) Yes [ ] (b) No [ ]

If no than why ………………………….

2. Do you think the present system is effective / better than the previous appraisal
system?

(a) Yes [ ] (b) No [ ]

3. Do you think the e-map system reduces biasness?

(a) Yes [ ] (b) No [ ]

4. As an appraisee do you face any problem while selecting the KRAs?

(a) Yes [ ] (b) No [ ]

5. Does your appraiser helps you in selecting the KRAs?

(a) Yes [ ] (b) No [ ]

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6. Do you think the present list of KRAs cover all aspect of your job?

(a) Yes [ ] (b) No [ ]

7. Do you think the part B of e-map system should be transparent to an appraisee?

(a) Yes [ ] (b) No [ ]

8. Do you get any formal feedback regarding your performance?

(a) Yes [ ] (b) No [ ]

9. Are any steps taken to improve the performance if not up to the mark?

(a) Yes [ ] (b) No [ ]

10. Do you find these steps effective / useful in your job?

(a) Yes [ ] (b) No [ ]

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11. As an appraiser what problem do you face?

……………………………………………………………………………………………………...............……….

……………………………………………………………………………………………………...........................

..……………………………………………………………………………………………………………………..

12. Suggestion as an appraisee.

……………………………………………………………………………………………………............................

……………………………………………………………………………………………………............................

..……………………………………………………………………………………………………………………..

13. Suggestion as an appraiser.

……………………………………………………………………………………………………............................

………………………………………………………………………………………………………………………

..……………………………………………………………………………………………………………………..

……………………………………………………………………………………………………............................

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