hrm project report

8/7/2019 HRM Project Report

http://slidepdf.com/reader/full/hrm-project-report 1/21

2 0 1 1

Performance Appraisal System at Dabur India Limited

Project Report: Human Resources

Management

Project Title: Performance Appraisal System at Dabur India

Limited

1 | P a g e

Submitted by:

Ankita Bhargava 09HR-

005

Ankur Arora 09HR-

006

Megha Latawa 09HR-

011

Dr. Nisheeth Kumar 09HR-014

Shubham Kapoor 09HR-

023

Mallika Kulkarni 09HR-

032



2 0 1 1


Contents

Contents ............................................................................................................. 2

Introduction ........................................................................................................ 3

The Appraisal Process ......................................................................................... 4

Performance Management ................................................................................. 5

Who Evaluates Performance? ............................................................................. 6

Dabur India Limited: Organizational Profile ........................................................ 7

Performance Appraisal System in Dabur India Limited .......................................7

Outcome of Performance Appraisal.................................................................... 8Duration of Appraisal System ............................................................................. 9

Feedback ............................................................................................................ 9

Response ............................................................................................................ 9

Sample of the study .......................................................................................... 10

Methodology of the project ............................................................................... 10

The Questionnaire ......................................................................................... 10

Response to Questionnaire ............................................................................ 10

Data entry and analysis ................................................................................. 11

Limitations ..................................................................................................... 11

Research Findings ............................................................................................ 11

1. Promotions .................................................................................................... 11

Aligning goal..................................................................................................... 13

Career Progress ................................................................................................ 13

Feedback .......................................................................................................... 15

Promotion Policy and Performance Appraisal System .......................................16

Conclusion ........................................................................................................ 16

Suggestions ...................................................................................................... 17

Open Appraisal System ..................................................................................... 18

Annexure .......................................................................................................... 19

Questionnaire ................................................................................................... 19

Bibliography ...................................................................................................... 20

2 | P a g e



2 0 1 1


Introduction

Performance appraisal may be defined as a structured formal interaction

between a subordinate and supervisor, that usually takes the form of a periodicinterview (annual or in which the work performance of the subordinate is

examined and discussed) with a view to identifying weaknesses and strengths as

well as opportunities for improvement and skills development.

In many organizations appraisal results are used, either directly or indirectly, to

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

identify the better performing employees who should get the majority of

available merit pay increases, bonuses and promotions. By the same token,

appraisal results are used to identify the poorer performers who may require

some form of counselling, or in extreme cases, demotion, dismissal or decreases

in pay. (Organizations need to be aware of laws in their country that might

restrict their capacity to dismiss employees or decrease pay).

In general the appraisal systems serve two main purposes:

1. To improve the work performance of employees by helping them realize

and use their full potential in carrying out their firm’s mission.

2. To provide information to employees and managers for use in work related

decisions.

More specifically appraisals serve the following purposes:

a) Appraisals provide feedback to employees and help the management identify

the areas where development efforts are needed to bridge the gaps thereby

serving as vehicles for personal and career development.

b) It helps management spot individuals who have specific skills so that their

promotions/transfers are in line with organizational requirements.

c) Appraisals serve as a key input for administering a formal organisation reward

and punishment system.

d) The performance system can be used as a criterion against which selection

devices and development programs are validated.

3 | P a g e



2 0 1 1


There are basically three purposes to which performance appraisal can be put.

• First, it can be used as a basis for reward allocations. Decisions as to, who

gets salary increases, promotions, and other rewards are determined by

their performance evaluation.

• Second, these appraisals can be used for identifying areas where

development efforts are needed. Management needs to spot those

individuals who have specific skill or knowledge deficiencies. The

performance appraisals are a major tool for identifying these deficiencies.

• Finally the performance appraisal can be used as a criterion against which

selection devices and development programs are validated. It is one thing

to say, for example, that our selection process is successful in

differentiating satisfactory performers from unsatisfactory performers.

The Appraisal Process

1. Objectives of performance appraisal

2. Establish job expectations

3. Design an appraisal programme

4. Appraise performance

5. Performance interview

6. Archive appraisal data

7. Use appraisal data for appropriate purposes

The appraisal process begins with the establishment of performance standards.

These should have evolved out of job analysis and the job description discussed

under human resource planning. These performance standards should also be

4 | P a g e



2 0 1 1


clear and objective enough to be understood and measured. Too often, these

standards are articulated in some such phrase as "a full day's work" or "a good

job". Communication only takes place when the transference has taken place

and has been received and understood by the subordinate. Therefore feedback is

necessary from the subordinate to the manager. Satisfactory feedback censures

that the information communicated by the manager has been received and

understood in the way it was intended.

The third step in the appraisal in the measurement of performance. To determine

what an employees’ actual performance is, it is necessary to acquire information

about it. We should be concerned with how we measure and what we measure.

What we measure is probably more critical to the evaluation process than how

we measure, since the selection of the wrong criteria can result in serious

dysfunctional consequences. And what we measure determines, to a great

extent, what people in the organization will attempt to excel at.

One of the most challenging tasks facing managers is to present an accurate

appraisal to the subordinate and then have the subordinate accept the appraisal

in a constructive manner. Appraising performance touches on one of the most

emotionally charged activities the assessment of another individual's

contribution and ability. The impression that subordinates receive about their

assessment has a strong impact on their self-esteem and, very important, on

their subsequent performance.

The final step in the appraisal is the initiation of corrective action when

necessary. Corrective action can, be of two types. One is immediate and deals

predominantly with symptoms. The other is basic and delves into causes.

Immediate corrective action often described as "putting out fires," whereas basic

corrective action gets to the source of deviation and seeks to adjust the

difference permanently. Immediate action corrects something right now and gets

things back on track.

Performance Management

Since organizations exits to achieve goals, the degree of success that individual

employees have in reaching their individual goals is important in determining

5 | P a g e



2 0 1 1


organization effectiveness. Performance system is fundamentally a feedback

process, which requires sustained commitment. The cost of failure to provide

such feedback may result in a loss of key professional employees, the continued

poor performance of employees who are not meeting performance standards

and a loss of commitment by employees, in sum, the myth that the employees

know what they are doing without adequate feedback from management can be

an expensive fantasy.

Who Evaluates Performance?

The most fundamental requirement for any individual who rates performance is

that he or she has an opportunity to observe an employee’s job performance

over a reasonable period of time. The following individuals can possible rate

employee performance:

The immediate supervisor:

Generally appraisal is done by this person. He is probably the most familiar with

the individual's performance and in most jobs has had the best opportunity to

observe actual job performance. Furthermore, the immediate supervisor is

probably best able to relate the individual's performing to department and

organizational objectives. In some jobs such as outside sales, law enforcement

and teaching, the immediate supervisor may observe a subordinate's actual job

performance rarely (and indirectly thru written reports). Here judgment of peers

play important role. However, there is a danger of potential bias.

Subordinates:

Appraisal by subordinates can be useful input to the immediate development.

Subordinates know firsthand the extent to which the supervisor actually

6 | P a g e



2 0 1 1


delegates, how well he communicates, the type of leadership he has and the

extent to which he or she plans and orgasms.

Self appraisal:

On one hand it improves the rate's motivation and moral, on the other it tends to

be more lenient, less variable and biased. The evidence on the accuracy of self

assessment is fairly complex.

In industry it is seen that feed back/ input is taken from various sources -Peers,

subordinates, superiors etc. Some companies have gone step ahead in taking

feedback from the customers and integrating it into the performance

management process.

Dabur India Limited: Organizational Profile

The story of Dabur goes back to 1884, to a young doctor armed with a degree in

medicine and a burning desire to serve mankind. This young man, Dr. S. K.

Burman, laid the foundations of what is today known as Dabur India Limited.

From those humble beginnings, the company has grown into India's leading

manufacturer of consumer healthcare, personal care and food products.

Performance Appraisal System in Dabur India Limited

The main objective of the performance appraisal system at Dabur India Limited

is to evaluate employee performance, promote their employees and to arrange

for their various training programmes if they require for enhancing their skills in

their respective areas and in contribution enhancement.

7 | P a g e



2 0 1 1


Employees are evaluated by how well they accomplish a specific set of

objectives that have been determined to be critical in the successful completion

of their job. This approach is frequently referred to as management by

objectives. Management by objectives is a process that converts organizational

objectives into individual objectives. It can be thought of as consisting of four

steps: goal setting, action planning, self- control, and periodic reviews. In goal

setting, the organization's overall objectives are used as guidelines from which

departmental and individual objectives are set. In action planning, the means are

determined for achieving the ends established in goal setting. That is, realistic

plans are developed to attain the objectives. Self-control refers to the systematic

monitoring and measuring of performance. Finally, with periodic progress

reviews, corrective action is initiated when behaviour deviates from the

standards established in the goal-setting phase. Dabur uses very constructive

performance appraisal process while evaluating its employees. Its evaluation is

based on quantity and objectivity.

Company set goals to its employee by properly reporting with its employees and

then evaluating them up to what extent it has been achieved and if there is

failure in reaching the target what are the causes or reasons behind it.

Every evaluator has his or her own value system which acts as a standardagainst which appraisals are made. Relative to the true or actual performance an

individual exhibits, some evaluators mark high and others low. The former is

referred to as positive leniency error and the latter as negative leniency error.

When evaluators are positively lenient in their appraisal, an individual's

performance becomes over- stated; that is, rated higher than it actually should.

Similarly, a negative leniency error understates performance, giving the

individual a lower appraisal. As such there is no scope of error as far as the

Dabur is concerned, but sometimes over estimation of target brings about a

description in the evaluating criteria. Thus, though chances are less, positive

leniency errors have been stated to be committed.

Outcome of Performance Appraisal

As far as Dabur India Limited is concerned, there are four outcomes possible:

8 | P a g e



2 0 1 1


a. Outstanding

If the performance evaluated by the management turns out to be outstanding. If

the employee performs in such a way as to collect 3 consecutive outstanding

performance into his or her credit, he or she gets promoted.

b. Excellent

If the performance evaluated by the management turns out to be excellent. If

the employee performs in such a way as to collect 3 consecutive excellent

performance into his or her credit, he/she gets promoted.

c. Good

If the performance evaluated by the management turns out to be good. The

management sends the employee to the training programme to improve his or

her skill to perform form.

d. Below average

If the performance evaluated by the management turns out to be below average.

And, if the employee collects 3 below average to his or her credit, then he/she

dismissed

Duration of Appraisal System

The time constraints enables the employee to show or project his or her

capabilities in term of performance as per the duration allowed. In Dabur India

Limited, the performance appraisal system is carried out annually.

Feedback

The company provides the annual feedback to its employees and thus, in term

bring out the highlights of the self assessment programme. This enables better

communication between the management and employees thus, helps in

promoting the business future.

Response

9 | P a g e



2 0 1 1


There are mixed responses from the feedback by the employees. It has helped

some of the employees in motivating themselves while those who felt bad were

thoroughly communicated and all the confusion and failure part were discussed

with employees.

Sample of the study

The population covered for the present study consisted of employee belonging to

supervisory and the level above. For the purpose of this study, survey covered

the employee of DABUR INDIA LTD. falling under supervisor and the level above.

The study covered a sample of 30 employees belonging to supervisory level and

above.

Methodology of the project

The project work has been carried out in three stages, a structured questionnaire

with objective and question was communicated tested and finalize. During the

second stage, the questionnaire was administered to the employees at Dabur

India Ltd. by contacting them. The work relating to data entry compilation, data

analysis and report writing constituted the third stage. Interview index was alsoused at some places to get information on the project subject.

The details of the methodology adopted are presented below:

The Questionnaire

Keeping in view the objective of the study, questionnaire was designed and

tested on few employees. After getting the proper response and sanction from

the concerned department the questionnaire was finalized.

Response to Questionnaire

In all 30 questionnaires were given to employees falling in the category of

supervisors and above. Out of which 21 could be collected back duly completed.

The researcher individually contacted the employees to get response on the

questionnaire.

10 | P a g e



2 0 1 1


Data entry and analysis

It has been an uphill task to enter the enormous data received through the

questionnaire which consisted of nearly 10 questions. Hence these were further

structured in time with the system adopted for compilation and data analysis.

Limitations

Many employees gave guarded answers to some crucial questions. Some of

them did not fill the questionnaire due to lack of time. Response could not be

collected from the total sample selected. Some of the questionnaire could not be

completed due to reasons other than time factor. The confidentiality of the

system created some problem in getting information.

Research Findings

After collecting the data on "Performance Appraisal System" data was Analyzedand interpreted. The various topics covered for analysis and interpretation of

data are:

1. Promotions

A promotion may be defined as an upward advancement of an employee in anorganisation to another job, which commands better pay/wages, better status,

prestige and higher opportunities, challenges and responsibility, a better working

environment, hours of work and facilities etc. Promoters have a salutary effect

on the satisfaction of the promoted person's need for esteem, belonging and

security. They also afford an opportunity for greater self-actualizing action

through more varied and challenging assignments. The promotion policies differ

from an organisation to another. The guidelines for departmental promotion in

are same for male and female employees. The period of experience required for

filling a higher post departmentally varies from 3-5 years. 5 years experience for

11 | P a g e



2 0 1 1


promotion to managerial staff and 3 years experience for promotion to Junior

Management staff is needed. The other area of promotion apart from seniority is

merit and fitness. Though these guidelines are not in a written format the

supervisor and manager get it at the time of appraisal from the personnel

department. As per the guidelines from the personnel department employees are

to be promoted accordingly. However there is confusion among the employee as

these guidelines are not being explained time to time, many are not aware of the

existing promotion policy in the organisation. Respondents were asked whether

the promotion is well defined in the organisation. The responses are given below:

Response Number Percentage Yes 5 26.3%No 9 50.0%Can’t say 4 22.2%

From the above table, it can be seen that 26% agree that promotion is well

defined in the organisation. However 50% were not able to say it as there is lack

of information about the promotion policy. Every employee need to be

communicated about the existing promotion policy.

12 | P a g e



2 0 1 1


Aligning goal

Respondent were asked about the present system, does it help in aligning

individual goals with those of the organisation. The responses were as given

below:

Responses Number Percentage Yes 10 47.6%No 4 19.0%Can’t Say 7 33.3%

Here the response from the supervisor was 47% for the factor that it helps in

aligning their goal with those of organisation.

Career Progress

Career progress is something which is continuous, with the input from

organisation in term of training, feedback and counselling. In today's changing

scenario this has to be followed in every organisation so that an individual make

progress in the career adding value to him and the organisation. Respondent

were asked about the current system helping in their career progress.

Career advancement is the most motivating factor when employees aspire for

the advancement of his career and for better opportunities to use his/her talents.

13 | P a g e



2 0 1 1


From the organisation's point of view, it is necessary to develop in manager,

some expectations of opportunities for the future in order to keep their

motivation high. Career planning means helping the employee plan his career in

terms of his capabilities with the context or organisational needs. Individual,

after becoming aware of some of his or her capabilities and career and

development opportunities, chooses to develop in a direction that improves their

chances of being able to handle new responsibilities. It is also the responsibility

of the employer to help the employee to identify the career opportunity, make

choices and develop their career and provide opportunities for career planning

and succession planning.

Question asked was as follows:

Are the issues like career planning and succession planning a part of company’s

policy? The responses to the above were as given below:

Response Number Percentage Yes 4 21.0%No 9 47.3%Can’t say 6 31.5%

Here only 47% of the respondent gave response that it does not have a career

development plan and a succession plan.

14 | P a g e



2 0 1 1


Feedback

Providing feedback plays constructive role. It helps the employee know his/her

weakness and strength. Feedback provides for the area of improvement.

Respondents were asked about the frequency of feedback based on their

performance. The responses were as given below

Response Number PercentageRarely 5 22.7%On a few occasions 8 36.3%Sometimes 6 27.2%

Often 3 13.6%Almost always 0 0

36 percent responded that feedback is provided though on a few occasion. The

frequency has to increase both from the individual and organisation point of view

to keep the individual motivated for work in line with the organisational

expectation.

15 | P a g e



2 0 1 1


Promotion Policy and Performance Appraisal System

Respondents were asked whether the promotion policy is linked with the

performance appraisal system:

Response Number Percentage Yes 11 55%No 6 30%Can’t say 3 15%

Majority responded that that promotion policy is linked with the performance

appraisal system.

Conclusion

16 | P a g e



2 0 1 1


The analysis and interpretation of data on study of performance appraisal and its

effectiveness in an organization led to the following conclusions:

• The rule about promotion, though defined, needs to be communicated to

every employee before appraisal process is done and also justify thepromotion as a result of the appraisal. That the promotion policy followed

differs at different position and category. Uniformity has to be there in the

implementation of promotion policy at all levels

• The process of performance appraisal followed in Dabur India Ltd. at the

supervisory level and above is satisfactory. The employees do not rate it very

high.

• The appraisal outcome has to be used frequently for the purpose of reward on

performing well together with the feedback on the performance. Also when

performance goes down employee has to be given feedback and motivated to

do better. The organization at present doesn't focus on career planning and

career suggestion plans.

• In Dabur India Ltd. feedback is being provided to the employee though on a

few occasions when performance appraisal in Dabur India Ltd. is done on an

annual basis.

Suggestions

The study undertaken, brought forth some interesting results.

• Training the Appraiser: It is proposed that appraiser be trained for clear

understanding of the system and its objective and also counselled to behonest, fair, just, unbiased in appraising the appraisal.

• Factors/traits of evaluation: It is proposed that appraisal evaluated on above

factors/traits be given suitable remark or justification for being given different

quantitative grade.

• Greater clarity has to be has to there in terms of job responsibility. This is

possible when the appraisal is done on the basis of the description.

17 | P a g e



2 0 1 1


• In the organization, performance appraisal is done on an annual basis which

should be done Quarterly to make it more effective.

• Consistency is demanded in the promotional policy. It should not change

every year.

• Monetary difference between two grades should not be large; it should be

motivating in nature.

• Performance appraisal system should be made more transparent and

rationale.

• Performance feedback: The performance feedback sessions should be

improved which would results in increasing employee motivation to improve

performance. The following could be incorporated:

o Pin point the problem behaviours and make sure the employee is

aware of it.

o Make sure the employee understands the consequences of the problem

behaviours. Get employee's commitment to change and make sure he

cares about the change.

o Assistance should be provided to improve poor performance. Make a

realistic plan appropriate to the behaviour and set a time frame for

improvement.

o Make sure to review performance time to time.

• Other changes to be incorporated at the supervisor level and above are:

o These should be listing down of task undertaken during the last oneyear and the result achieved.

o In some areas of performance there should be self appraisal and more

and more counselling so that employees improve upon weak area and

understand what is expected of him/her at the organization level.

Open Appraisal System

18 | P a g e



2 0 1 1


Based on the above an open appraisal system is suggested. In an open appraisal

the employee would come together to set the targets, to understand the mutual

expectations and support to be provided by the appraiser to the employee for

achieving mutually accepted goals/targets. Through this process of setting

targets the interpersonal relationship between the appraiser and the employee

would improve. The open appraisal system reduces the whims and fancies of the

appraiser. It promotes result-orientation as it is based on performance rather

than on personality based appraisal.

Annexure

Questionnaire

Personal Information

Q1. Name:

Q2. Designation:

Q3. Department:

Q4. Service in Profession (in years):

Q5. Is the promotional policy well defined in your organization?

a. Yes b. No c. Can't say

Q6. Does the system help you in aligning your goals with those of the

organization?


19 | P a g e



2 0 1 1


Q7. Are the issues like career planning and succession planning a part of

company's policy?


Q8. Do the employees get the feedback for their performance appraisal?

a. Rarely b. On a few occasions c. Sometimes

d. Often

e. Almost always

Q9. Do you think your promotional policy is linked with the performance

appraisal system?


Q10. How do you rate the overall assessment of performance appraisal?

a. Outstanding b. Very goodc. Good d. Satisfactory e.

Poor

Bibliography

Flippo EdwinB., Personnel management, Edition sixth, Tata Mc Graw Hills, 1984,

p225-2302

Gupta, C.B., Human Resource Management, Edition Fifth (Reprint), Sultan Chand

and Sons, New Delhi 2001, p5.3-5.103

Rao, P. Subba, Essentials of Human Resource Management and Industrial

Relations; Edition Second, Himalaya Publishing House, New Delhi 2001, p206-

210

Arthur, J., 1994, Effects of human resource systems on manufacturing

performance and turnover, Academy of Management Journal, Vol. 37, p670–687

20 | P a g e



2 0 1 1


Bartel, A. P., 2004, Human resource management and organizational

performance: Evidence from retail banking; Industrial and Labour Relations

Review, Vol. 57, p181–203

M.M. Robertson and H. Yueng-Hsiang, 2006, Effect of a workplace design andtraining intervention on individual performance, group effectiveness and

collaboration: The role of environmental control; Work, Vol. 27, p3–12

Li-Yun Sun, Samuel Aryee, and Kenneth S. Law, 2007, High performance human

resource practices, citizenship behaviour, and organizational performance: A

relational perspective; Academy of Management Journal, Vol. 50, No. 3, p558–

577

Hunter, Larry W., Thatcher, Sherry M. B, 2007, Feeling the heat: effects of stress,

commitment, and job experience on job performance; Academy of Management

Journal, Aug2007, Vol. 50 Issue 4, p953-968

21 | P a g e

hrm project report

Documents