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Performance Appraisal
A project on “performance appraisal”
With relevance to appraisals at sharekhan limited.
INDEX
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Performance Appraisal
SERIAL
NO.TOPIC
PAGE
NO.
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Performance Appraisal
1 OVERVIEW 08
2 INTRODUCTION TO PERFORMANCE APPRAISAL 09
3 Meaning and Definition 12
4 Methods of Performance Appraisal 13
5 Types of Appraisal Interviews 23
6 Advantages of Performance Appraisals 28
7Disadvantages of Performance
Appraisals30
8 Introduction to Sharekhan Limited. 31
9 Services Offered by Sharekhan Ltd. 36
10Performance Appraisal Criteria at
Sharekhan Ltd.37
11Structure of Performance Appraisal at
share khan ltd40
12OBJECTIVES OF PERFORMANCE APPRAISAL AT
SHAREKHAN LTD.43
13Performance Appraisal Process at Share
khan limited.44
14 Benefits of Performance Appraisal to
Share khan Ltd.54
15Performance appraisal feedback
interview48
16 Self Appraisal System 51
17Annexure -Questionnaire
54
Forms
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18
19 Findings
57
60
INTRODUCTION
In the business world investment is made in machinery,
equipment and services. Quite naturally time and money is spent
ensuring that they provide what their suppliers claim. In other words
the performance is constantly appraised against the results expected.
When it comes to one of the most expensive resources
companies invest in, namely people, the job appraising performance
against results is often carried out with the same objectivity. Each
individual has a role to play and management has to ensure that the
individual’s objectives translate into overall corporate objectives of the
company. Performance Management includes the performance
appraisal process which in turn helps identifying the training needs and
provides a direction for career and succession planning.
Understanding Performance Management
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PERFORMANCE MANAGEMENTPERFORMANCE MANAGEMENT
DETERMINE INDIVIDUAL OBJECTIVES LINKED TO CORPORATE GOALS
DETERMINE INDIVIDUAL OBJECTIVES LINKED TO CORPORATE GOALS
PERFORMANCE APPRAISALPERFORMANCE APPRAISAL
ENSURE RESPONSIBILITY AND ACCOUNTABILITY ENSURE RESPONSIBILITY AND ACCOUNTABILITY
PERFORMANCE LINKED INCREMENTS/ INCENTIVES/ REWARDS
PERFORMANCE LINKED INCREMENTS/ INCENTIVES/ REWARDS
CORPORATE GOALSCORPORATE GOALS
Performance Appraisal
What is Performance?
How is Performance managed?
Good performance by the employees creates a culture of
excellence, which benefits the organization in the long run. The activity
includes evaluation of jobs and people both, managing gender bias,
career planning, and devising methods of employee satisfaction etc.
the efforts are to make to generate the individual’s aspirations with the
objectives of the organization.
Organization has to clear the way of career advancements for
talented and hardworking people. Fear of any kind from the minds of
the employees should be removed so that they give best to their
organization. Allow free flow of information. Communication network
should be designed in such a way no one should be allowed to become
a hurdle. This enables the managers to take correct decisions and that
too quickly.
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Why Performance Appraisal?
Today’s working climate demands a great deal of commitment
and effort from employees, who in turn naturally expect a great deal
more from their employers. Performance appraisal is designed to
maximize effectiveness by bringing participation to more individual
level in that it provides a forum for consultation about standards of
work, potential, aspirations and concerns. It is an opportunity for
employees to have significantly greater influence upon the quality of
their working lives. In these times of emphasis on “quality”, there is a
natural equation: better quality goods and services from employees
who enjoy better quality “goods and services” from their employers.
Performance appraisal must be seen as an intrinsic part of a
manager’s responsibility and not an unwelcome and time-consuming
addition to them. It is about improving performance and ultimate
effectiveness.
Performance appraisal is a systematic means of ensuring that
managers and their staff meet regularly to discuss post and present
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performance issues and to agree what future is appropriate on both
sides.
It should also be understood that pushing a previously prepared
report across and desk cursorily inviting comments, and expecting it to
be neatly signed by the employee is not appraisal - this is merely a
form filling exercise which achieves little in terms of giving staff any
positive guidance and motivation.
Meaning and Definition of Performance
Appraisal
Meaning
The meaning of the word “appraisal” is “to fix a price or value for
something”. This is used in finance in terms such as project appraisal
or financial appraisal where a value is attached to a project. Similarly
performance appraisal is a process in which one values the employee
contribution and worth to the organization.
In simple terms, appraisal may be understood as the assessment
of an individual’s performance in a systematic way, the performance
being measured against such factors as job knowledge, quality, and
quantity of output, initiative, leadership abilities, supervision,
dependability, co-operation, judgment, versatility, health, and the like.
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Assessment should not be confined to past performance alone.
Potentials of the employee for future performance must also be
assessed.
DEFINITION OF PERFORMANCE APPRAISAL:
A formal definition of performance appraisal is:
“It is the systematic evaluation of the individual with respect to
his or her performance on the job and his or her potential for
development.”
METHODS OF PERFORMANCE APPRAISAL
A] Past-oriented methods
1)Rating Scale
The rating scale method offers a high degree of structure for
appraisals. Each employee trait or characteristic is rated on a bipolar
scale that usually has several points ranging from “poor” to “excellent”
(or some similar arrangement).
The traits assessed on these scales include employee attributes such
as cooperation, communications ability, initiative, punctuality and
technical (work skills) competence. The nature and scope of the traits
selected for inclusion is limited only by the imagination of the scale’s
designer, or by the organization’s need to know.
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The one major provision in selecting traits is that they should be
in some way relevant to the appraisee’s job.
RATING SCALE
Instructions: For the following performances factors, please indicate on the rating Scale your evaluation of the employee named below:
Employee’s Name: DepartmentRater’s Name Date.
Excellent Good Acceptable Fair Poor 5 4 3 2 1
1. Dependability ------ ------ ------ -----
-----
2. Initiative ------ ------ ------ ----- -----
3. Overall Output ------ ------ ------ ----- -----
4. Attendance ------ ------ ------ ----- -----
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5. Attitude ------ ------ ------ ----- -----
6. Co-Operation ------ ------ ------ ----- -----
------ ------ ------ ----- -----
------ ------ ------ ----- -----
------ ------ ------ ----- -----
20. Quality of Work ------ ------ ------ ----- -----
TOTAL + + + +
TOTAL SCORE
2) Check-list Method
Under this method, checklist of “Statements of Traits” of employee
in the form of Yes or No based questions is prepared. Here, the rater
only does the reporting or checking and HR department does the
actual evaluation. The rater concerned has to tick appropriate answers
relevant to the appraisees. When the check-list is completed, it is sent
to HR department for further processing.
Various questions in the check list may have either equal weight
age or more weight age may be given to those questions which are
more important. The HR department then calculates the total scores
which show the appraisal result of an employee.
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Table: - Checklist for Operators
SR.
NO.
QUESTIONS YES NO
1. Is the employee really interested in the job? - -
2. Does he or she possess adequate knowledge
about the job
- -
3. Is his or her attendance satisfactory? - -
4. Does he/she maintain his/her equipment in good
condition?
- -
5. Does he/she co-operate with co-workers? - -
6. Does he/she keep his/her temper? - -
7. Does he/she obey orders? - -
8. Does he/she observe safety precautions? - -
9. Does he/she complete what he/she commences? - -
10. Does he/she evade responsibility? - -
3] Force Choice Method
In this, the rater is given a series of statements about an
employee. These statements are arranged in blocks of 2 or more, and
the rater indicates which statement is most or least descriptive of the
employee. Typical statements are:
1. Learns fast _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ works hard
2. Work is reliable_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ performance is a good
example for
3. Absents often_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ others usually tardy.
As in the checklist method, the rater is simply expected to select the
statements that describe the rate. Actual assessment is done by the
HR Department.
This approach is known as the forced choice method because the rater
is forced to select statements, which are readymade. The advantage of
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this method is the absence of personal bias in rating. The disadvantage
is that the statements may not be properly framed – they may not be
precisely descriptive of the ratee’s traits.
4) Force Distribution Method
One of the problems faced in large organizations is relative
assessment tendencies of raters. Some are too lenient and others too
severe. This method overcomes that problem. It forces every one to do
a comparative rating of all the employees on a predetermined
distribution pattern of good to bad. Say 10% employees in Excellent
Grade, 20% in Good Grade, 40% in Average Grade, 20% in Below
Average Grade and 10% in unsatisfied grade.
The real problem of this method occurs in organizations where
there is a tendency to pack certain key departments with all good
employees and some other departments with discards and laggards.
Relatively good employees of key departments get poor rating and
relatively poor employees of laggards’ departments’ get good rating.
5) Critical Incident Method
In this method, only critical incidents and behavior associated
with these incidents are taken for evaluation. This method involves
three steps. A test of noteworthy on the job behavior is prepared. A
group of experts then assigns scale values to them depending on
the degree of desirability for the job. Finally, a checklist of incidents
which define good and bad employees is prepared.
• Advantages ---
This method is very useful for discovering potential of employees
who can be useful in critical situation.
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• Disadvantages ---
a) Negative incidents are, generally, more noticeable than
positive ones.
b) The recording of incidents is a core to the superior and may be
put off.
c) Overly close supervision may result.
6) Essay Method
In the essay method approach, the appraiser prepares a written
statement about the employee being appraised. The statement usually
concentrates on describing specific strengths and weaknesses in job
performance. It also suggests courses of action to remedy the
identified problem areas. The statement may be written and edited by
the appraiser alone, or it be composed in collaboration with the
appraisee.
7) Grading
In this method, certain categories of abilities of performance are
defined well in advance and person are put in particular category
depending on their traits and characteristics. Such categories may be
definitional like outstanding, good, average, poor, very poor or may be
in terms of letter like A, B, C, D etc with A indicating the best and D
indicating the worst. This method, however, suffers from one basic
limitation that the rater may rate most of the employees at higher
grades.
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8) Performance Tests & Observations:
This is based on the test of knowledge or skills. The tests may be
written or an actual presentation of skills. Tests must be reliable and
validated to be useful.
• Advantage – Tests only measure potential and not attitude. Actual
performance is more a function of attitude of person than potential.
• Disadvantages – Some times costs of test development or
administration are high.
9) Confidential Reports
Though popular with government departments, its application in
industry is not ruled out. Here the report is given in the form of Annual
Confidentiality Report (ACR). The system is highly secretive and
confidential. Feedback to the assessee is given only in case of an
adverse entry. Disadvantage is that it is highly prone to biases and
regency effect and ratings can be manipulated because the
evaluations are linked to future rewards like promotions, good
postings, etc.
10) Comparative Evaluation Method (Ranking & Paired
Comparisons)
These are collection of different methods that compare
performance with that of other co-workers. The usual techniques
used may be ranking methods and paired comparison method.
Ranking Method:
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Superior ranks his worker based on merit, from best to worst.
However
How best and why best are not elaborated in this method. It is easy
to administer.
Paired Comparison Method:
In this method each employee is paired with every other employee
in the same cadre and then comparative rating done in pairs so
formed. The number of comparisons may be calculated with the
help of a formula – N x (N-1) / 2. The method is too tedious for large
departments and often such exact details are not available with
Appraiser.
B] Future-Oriented Methods
1) MBO (Appraisal by Results)
The use of management objectives was first widely advocated in
the 1950s by the noted management theorist Peter Drucker. MBO
(management by objectives) methods of performance appraisal are
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results-oriented. That is, they seek to measure employee performance
by examining the extent to which predetermined work objectives have
been met.
Usually the objectives are established jointly by the supervisor
and subordinate. Once an objective is agreed, the employee is usually
expected to self-audit; that is, to identify the skills needed to achieve
the objective. Typically they do not rely on others to locate and specify
their strengths and weaknesses. They are expected to monitor their
own development and progress.
2) Assessment Center Method
This technique was first developed in USA and UK in 1943. An
assessment centre is a central location where managers may come
together to have their participation in job related exercises evaluated
by trained observers. It is more focused on observation of behaviours
across a series of select exercises or work samples.
Assesses are requested to participate in in-basket exercises,
work groups, computer simulations, role playing and other similar
activities which require same attributes for successful performance in
actual job.
3) 360o Appraisal
It is a technique in which performance data/feedback/rating is
collected from all sections of people employee interacts in the course
of his job like immediate supervisors, team members, customers,
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peers, subordinates and self with different weight age to each group of
appraisers.
This technique has been found to be extremely useful and
effective. It is especially useful to measure inter-personal skills,
customer satisfaction and team building skills.
One of the biggest advantages of this system is that assesssees
cannot afford to neglect any constituency and has to show all-round
performance. However, on the negative side, receiving feedback from
multiple sources can be intimidating, threatening, and expensive and
time consuming.
3) Psychological Appraisals
These appraisals are more directed to assess employee’s potential
for future performance rather than the past one. It is done in the form
of in-depth interviews, psychological tests, and discussion with
supervisors and review of other evaluations.
It is more focused on employees emotional, intellectual, and
motivational and other personal characteristics affecting his
performance. This approach is slow and costly and may be useful for
bright young members who may have considerable potential.
However quality of these appraisals largely depends upon the skills
of psychologists who perform the evaluation.
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Each of these has its own combination of strengths and weaknesses
and none is able to achieve all the purposes for which management
institutes Performance Appraisal System. Nor is any one technique
able to evade all the pitfalls. The best anyone can hope to do is to
match an appropriate appraisal method to a particular Performance
Appraisal goal
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Types of Appraisal Interview
Managers never assume that only one type of appraisal interview
in appropriate for every review session. Rather, they should be able to
use one or more of the interview types depending on the topic being
discussed or the behavior being appraised. Feedback is necessary to
effect improvement in performance, especially when it is inadequate.
Specially, performance interview has three goals:
1. To change behavior of employees whose performance does not
meet organizational requirements or their own personal goals?
2. To maintain the behavior of employees who perform in an
acceptable manner, and
3. To recognize superior performance behaviors so that they will be
continued.
Three distinct types of interview are commonly used
Tell and sell
Tell and listen
Problem solving and mixed.
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1.Tell and sell
It is also called as directive
interview; the interviewer lets assessees know how well they are
doing and sells them on merits of setting specific goals for
improvement, if needed.
Has little provision for
employee participation
Generally consists of three
stages
Manager lets employee know how the latter is doing.
The employee’s acceptance of this evaluation is sought.
The employee agrees to follow a pre-determined plan for improved
job performance.
This method does not require much of anyone’s time but is of little
use if the improved behavior does not eventuate.
There is no opportunity for employee participation and over time, it
is likely that employees will only perform to conform to their
manager’s wishes.
The role of the supervisor / manager is one of ‘judge’ and ‘jury’.
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2.Tell and listen
Tell and listen interview provides the subordinates with chances to
participate and establish a dialogue with their superiors. Its
purpose is to communicate the rater’s perceptions.
It is the most commonly used interview technique.
As with “Tell and Sell”, the manager lets the employee know how
he or she is doing.
Communicate strong and weak points of an employee’s job
performance.
The employee has a chance to respond to the assessment and
present his/ her views.
Employee’s feelings of the appraisal are thoroughly explored.
BOTH views are then considered together, a conclusion reached
and a plan for future performance is developed.
This is much more flexible approach, however, the type of reaction
provoked may strongly affect the success of the interview
For example, if the manager’s remarks are perceived as unfair.
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(Or critical) by the employee, defense mechanism and face saving,
rather than constructive responses might still be the outcome.
The “Tell and Listen” method assumes that the opportunity to
release frustrated feelings will help reduce or remove them.
3. Problem solving and mixed
In the problem solving or participative interview, an active and
open dialogue is established between the superior and the
subordinate. Not only are perceptions shared, but also solutions to
problems are presented, discussed, and sought. Mixed interview is
a combination of tell and sell and problem solving interviews.
Differs markedly from the methods above.
Although recommended by some, since the objective of appraisal is
normally to stimulate growth and development in the employee.
It is used more widely in ‘counseling’ and is an unstructured
approach.
The skills are consistent with the non-directive procedures of the
“Tell and Listen” method in that listening, accepting and
responding to feelings are essential.
However, it goes beyond an interest in the employee’s feelings.
It seeks to stimulate growth and development in the employee by
discussing problems, needs innovations, satisfactions and
dissatisfactions encountered since the last appraisal.
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A work – related situation is presented and both the manager and
the employee discuss a solution.
The manager assumes the role of a ‘Helper’ or ‘Facilitator’ rather
than a judge and emphasis is on the work situation, not the
business of the individual.
Can lead to a wide range of changes in work practices, patterns of
supervision and individual attitudes.
Managers need to have the following characteristics
Be well prepared
Show trust
Be active listeners
Discuss frankly any areas where performance is not up to standard,
backing this with specific examples.
Conversely good performance should be praised, again using
specific examples.
It is also important for the employee not to leave the interview with
any issues unsolved.
Whatever is the approach followed, the emphasis in the
interview should be on counseling and development and not on
criticism, witch – hunting and buck passing. Because of the significance
of appraisal interview, every effort must be made to make it effective.
Guidelines given will help make the interview successful.
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Advantages of Performance Appraisals to the Organization and the Employee
The objectives of performance appraisal, listed, point out the
purpose which such an exercise seeks to meet. What needs emphasis
is that performance evaluation contributes to firm's competitive
strength.
Besides encouraging high levels of performance, the evaluation
system helps identify employees with potential, reward performance
equitably and determine employee's need for training. Specifically,
performance appraisal helps an organization gain competitive edge in
the following ways (see Fig below)
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Fig: How Performance Appraisal can contribute to Firm's
Competitive Advantage?
Improving Performance
An effective appraisal system contribute to competitive
advantage by improving employee job performance in two ways-by
directing employee behavior towards organizational goals, as was done
by the second beekeeper (see opening case), and by monitoring that
behavior to ensure that the goals are met.
Making Correct Decisions:
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Strategy andBehavior
ImprovingPerformance Making
correct decisions
CompetitiveAdvantage
Minimizing dissatisfaction and turnover
Ensuring Legal
Compliance
Values and Behavior
Performance Appraisal
As stated above, appraisal is a critical input in making decisions
on such issues as pay raise, promotion, transfer, training, discharges
and completion of probationary periods. Right decision on each of
these contributes to competitive strength of an organization. If
promotion, for example, is made on performance, the promotee feels
motivated to enhance his or her performance.
Minimizing Job Dissatisfaction and Turnover:
Employees tend to become emotional and frustrated if they
perceive that the ratings they get are unfair and inaccurate. Such
employees find that the efforts they had put in became futile and
obviously get de-motivated. Dissatisfaction in the job sets in and one of
the outcomes of job dissatisfaction is increased turnover. An
organization having satisfied and motivated employees has an edge
over its competitors.
Disadvantages of Performance Appraisals to the Organization and to the Employees
Obstacles to the success of formal Performance Appraisal
programs is to be familiar to most managers, either from painful
personal experience or from the growing body of critical literature.
Here are the most troublesome and frequently cited drawbacks.
Performance Appraisal programs demand too much from
supervisors. Formal performance appraisal obliviously requires at
least periodic supervisor observation of subordinate’s
performance.
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Standards and ratings tend to vary widely and often. Unfairly,
some ratees are tough, while some are lenient. Some
departments have highly competent people, others have less
competent people.
Personal values and bias can replace organizational standards.
An appraiser may not lack standards, but the standards he uses
are sometimes wrong ones.
Because of lack of communication, employees may not know
how they are rated. The standards by which employees think
they are being judged are sometimes different from those their
supervisors actually use.
No performance appraisal system can be very effective for
management decisions, organization development, or any other
purpose until the people being appraised know what is expected
of them and by what criteria they are being judged
Introduction of Sharekhan Limited.
Sharekhan is the retail broking arm of SSKI, an organization with
more than eight decades of trust & credibility in the stock market.
• Amongst pioneers of investment research in the Indian market
• In 1984 ventured into Institutional Broking & Corporate Finance.
• Leading domestic player in Indian institutional business
• Over US$ 1 billion of private equity deals
Sharekhan:
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• Among the top 3 branded retail service providers (Rs 650 crs avg
daily vol- Apr-Dec’04)
• No. 2 player in online business
• Largest network of branded broking outlets in the country
servicing 81,000 clients
SSKI Group Companies:
• SSKI Investor Services Ltd (Sharekhan)
• S.S. Kantilal Ishwarlal Securities
• SSKI Corporate Finance
• Idream Productions
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SSKI – Corporate Structure:
Serving Institutional Investors –Domestic / International:
• In the Indian securities business since 1922….
• Our institutional Research team is rated as one of the best in the
industry
• Rated 1st by Asia Money
Research Coverage:
• Amongst the widest coverage’s among broking houses in India.
• Total coverage exceeds some 100 stocks spread over 20 sectors
• Sector wise investment strategies are in place
• Stock ideas are presented from time to time, in tune with overall
strategy.
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• Active coverage of political developments, economy changes
The Sharekhan way of life:
• People driven –
relationships!
• Fleet footed
• Growth driven
• Values and ethics
based
And we have a vision:
• To be the best retail broking brand in the Indian
Equities market.
HOW?
• By educating and empowering the individual investor
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Customized Research Reports
Investment advice for a diverse set of investment
approaches
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Serving customers via multiple channels
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The Services Sharekhan offers…
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Performance Appraisal Criteria at Sharekhan
Here the work is divided into 2 groups i.e. Back office work and
front office work. Back office undertakes office/paper work called as
Operations. Front office is called as Relationship Manager i.e.
maintaining relation with customers.
Thus ‘Performance Appraisal’ plays an important role in
Sharekhan. Performance Appraisal is conducted thrice in a year:-
1. Quarterly basis,
2. Half Yearly basis,
3. Yearly basis
And when an employee
completes his/her probation
period performance appraisal
takes place.
Performance appraisal is mainly based on targets and KRA i.e.
Key Result Area, if the targets are achieved appraisal and incentives
are given along with salary.
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Besides Appraisals are also based on Balanced Scorecard, which tracks
the achievement of employees on the basis of targets at four levels —
financial
customer
internal
Learning and growth
The financial perspective quantifies the employee’s contribution in terms of
revenue growth, cost reduction, improved asset utilization and so on.
The customer perspective looks at the differentiating value proposition offered
by the employee.
The internal perspective refers to the employee’s contribution in creating and
sustaining value.
The learning and growth are self-explanatory.
The weight age given to each attribute is based on the function the employee
performs.
Based on their individual achievements, employees are rated on
a scale of one to five (five = “superstar”). If employees get a low rating
(less than two) in two consecutive appraisals, the warning flags go up.
“If the poor performer continues getting low scores then the exit option
may be considered”
Over the years ShareKhan has found the pattern that leads to
the maximum decline in performance — boredom. If employees work
for more than two years on the same project, typically either their
performance dips or they leave the organization.
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To avoid that, ShareKhan shuffles its employees between
projects every 18 months or so. “Performance drops if motivation
drops”
At the heart of an employee's satisfaction lies the fact that his
performance is being appreciated and recognized. ShareKhan’s
performance management system has metamorphosed into one that
emphasizes objectivity and a system that mandates performance
evaluation against pre-determined criteria.
What deserves special mention is the active participation of the
senior management in the determination of guidelines for the
performance appraisal process. The process ensure buy in of the
employees since the guidelines for the rating system and its
conversion into money terms is not unilaterally decided by HR but is a
consensus of a cross functional team with representation from all
levels.
ShareKhan’s performance appraisal system is supported by an
online system called the Human Resource Management System- an
Oracle Developer 2000 based tool. The system records every moment
of the individual, right from his biographical details to his projects
performance. An employee's performance history at the click of a
button and this accurately maintained for 14000 employees!
Right from his entry, an employee in ShareKhan gets formal
performance feedback once every two months till such time that he is
confirmed after which the performance feedback is provided twice
every year on a formal basis. ShareKhan however widely encourages
informal feedback discussions between Project Leaders and Team
Members and this concept has found an overwhelming appeal among
the people.
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Structure of Performance Appraisal for Branch office and Head office:
Structure at Branch office for Performance Appraisal
Structure at Branch Office & Head office for Performance
Appraisal
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Head Office
Assistant
Managers
Supervisors
Head of Department
(Top Level Managers)Employees
Branch
Branch Managers Employees
Branch ManagersCluster Head
Performance Appraisal
Structure of Performance Appraisal in details:-
1. Branch office:
In this performance appraisal interview is taken of Cluster
Heads and Branch Managers. Then Cluster Heads takes a performance
interview of Branch Managers and Employees while on the other side
Branch Manager takes a performance interview of Employees.
2. Head Office:
In this performance appraisal interview is taken of Head of
Department (HOD’s) Supervisors Assistant
Managers. While on the other side Head Department takes a
performance interview of Employees.
Sharekhan’s Performance Appraisal is followed by
Rating Method:-
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While conducting Performance Appraisal employees
are been informed about the appraisal process, in the
following ways:
Circular is been given in the office by the Human Resource
Department.
Circular includes day, date, timings and way of performance
appraisal.
Rating method with the help of questionnaire format is given in the
circular by the Human Resource Department.
How the rating will be done and what kind of rewards will be given
to the employees.
All the above database is included in the circular
Lastly it is closed by head of Departments signature and Top level
manager.
After all this things during performance appraisal recommendation
is taken.
Then after conducting performance appraisal forms are been
checked by top level managers, Cluster heads and by HR department.
Rating takes place in this way:
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THE OBJECTIVES OF PERFORMANCE APPRIASALS AT SHARE KHAN IS AS FOLLOWS:
To review the
performance of
the employees
over a given
period of time.
To judge the gap
between the actual and the desired performance.
To help better current performances.
To help in development of the
employees.
To determine training and development
needs.
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Excellent 30%-40%
Very Good 20%
Good 15%
Average 10%
Below Average 0%
Performance Appraisal
To provide feedback to the employees regarding their past
performance.
To provide clarity of the expectations and responsibilities of the
functions to be performed by the employees.
To reduce the grievances of the employees
To review performance for salary purposes.
Performance Appraisal Process in Sharekhan
The Performance Appraisal Process consists of six steps. Each
step in the process is crucial and is arranged logically. The process
shown in the below figure is some what idealized. Many organizations
make every effort to approximate the ideal process, resulting in the
first-rate appraisal systems. Unfortunately, many others fail to consider
one or more of the steps and, therefore, have less - effective appraisal
system.
Performance Appraisal
Establishing Performance Standards
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Performance Appraisal
Communicating Standards to Employees
Measuring Actual Performance
Comparing Actual Performance with the Standards Set
Discussing Actual Performance with the Employee
( Appraisal Interview)
Offering Guidance for Improving Performance (Follow – up
Measures)
Benefits of Performance Appraisal At Sharekhan
Perhaps the most significant benefit of appraisal at Sharekhan is
that, in the rush and bustle of daily working life, it offers a rare chance
for a superior and subordinate to have to “time out” for one – on – one
discussion of important work uses that might now otherwise be
addressed.
The Company believes that Appraisal offers a valuable
opportunity to focus on work, activities and goals, to identify and
correct existing problems, and to encourage better future
performance. Thus the performance of this organization is enhanced.
Motivation and Satisfaction:
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Performance Appraisal
The management of ShareKhan believes that Performance
appraisal has profound effect on levels of employee’s motivation and
satisfaction - for better as well as for worse.
Performance appraisal provides employees with recognition for
their work efforts. The power of social recognition as an incentive has
been long noted. In fact, there is evidence that human beings even
prefer negative recognition in preference to no recognition at all.
If nothing else, the existence of an appraisal program indicates to
an employee that the organization is genuinely interested in their
individual performance and development. This alone has a positive
influence on the individuals’ sense of worth, commitment and
belonging.
The strength and prevalence of this natural human desire for
individual recognition is been overlooked. Absenteeism and turnover
rates in some organizations might be greatly reduced if more attention
were paid to it. Regular performance appraisal, at least, is a good start.
Training and Development :
Performance appraisal offers an excellent opportunity – perhaps
the best that it will ever occur - for a supervisor and subordinate to
recognize and agree upon individual training and development needs.
During the discussion of an employee’s work performance, the
presence or absence of work skills has become very obvious – even to
those who habitually reject the idea of training for them!
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Performance Appraisal
Performance appraisal makes the needs for training more pressing
and relevant by linking it clearly to performance outcomes and future
career aspirations.
From the point of view of the organization as a whole consolidated
appraisal data form a picture of the overall demand for training. This
data is analyzed by variables such as sex, department etc. in this
respect, performance appraisal provides a regular and efficient training
needs audit for the entire organization.
Recruitment and Induction:
Appraisal data is used to monitor the success of the organization’s
recruitment and induction practices. For example, how well are the
employees performing who were hired in the past two years?
Appraisal data is also used to monitor the effectiveness of changes
in recruitment strategies. By following the yearly data related to new
hires ( and given sufficient numbers on which to base the analysis) it
is possible to assess whether the general quality of the workforce is
improving staying steady, or declining.
Employee Evaluation:
Though often understated or even denied, evaluation is a
legitimate and major objective of performance appraisal.
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Performance Appraisal
But the need to evaluate (i.e to judge) is an on going source of
tension, since evaluative and development priorities appear to
frequently clash. Yet at its most basic level, performance appraisal is
the process of examining and evaluating the performance of an
individual.
Though organizations have a clear right – some would say a duty –
to conduct such evaluations of performance, many still recoil from the
idea. To them, the explicit process of judgment can be dehumanizing
and demoralizing and a source of anxiety and distress to employees.
“It is said that appraisal cannot serve the needs of evaluation and
development at the same time; it is one or the other”
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Performance Appraisal
The Appraisal Feedback Interview at sharekhan
At ShareKhan, the Management believes that Performance
appraisal process is incomplete without the feedback given to the
employee about his appraisal and his performance. But the way of
giving as well as receiving the feedback differs from person to person
and their way of handling and their outlook towards the issue.
According to a popular saying:
“A SUCCESSFUL MAN IS ONE WHO
CAN LAY A FIRM FOUNDATION WITH
THE BRICKS OTHERS HAVE THROWN
AT HIM.”
Whatever method of
appraisal, may be used by an
organization, it is crucial to allow for
‘employee feedback’.
An interview between the
manager and the employee is the
main way of achieving this. This is called the Appraisal Feedback
Interview
This interview provides the opportunity to discuss an
employees’ performance and explore areas of possible improvements
and growth. It also provides an opportunity to identify attitudes and
feelings more thoroughly and thus improve communication.
Fundamental to the success of the appraisal interview is the
relationship between the two participants in the process.
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Performance Appraisal
Points to be noted, while the Feedback Interview
takes place:
On the part of the person receiving the feedback, the following points
are important to be taken care of:
The employee should have a positive attitude towards the
feedback process
He should listen to the suggestions of the appraiser calmly and
try to incorporate them in his plans.
He should not hesitate to ask for the help of his superiors.
Should have a co-operative attitude during the feedback
meeting.
Don’t judge the appraiser as a person.
Should take the feedback objectively.
Should not judge the appraiser as a person on the basis of the
feedback.
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On the part of the appraiser or the manager / person giving the
feedback, the following points are to be taken care of:
The appraiser should make the receiver feel comfortable during
the feedback meeting.
The appraiser should make it a two – way conversation i.e. let
the employee speak.
Listen to the employee and note his points, suggestions,
problems etc.
Provide a constructive feedback to the employee i.e. in a way
which will motivate him to perform better.
Have a positive attitude towards the process
Try to understand the reasons of his failure.
Be fair and objective
Make the appraisal feedback meeting useful and productive for
the organization and the employee.
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Performance Appraisal
Self Appraisal System in Sharekhan
ShareKhan follows The Performance Appraisal system. It is done
at three levels. First by the employee itself followed by his superior and
then by the reviewing authority.
The appraisal process is based on Performance and is subjective
in nature. In Self Appraisal, the Appraisee is asked to highlight his best
performances and also list the areas where he feels he is not up to the
mark.
The Appraisee is also asked to highlight problems he’s faced and
opportunities he is required to improve his performance. He is also
asked to mention any outstanding performance he’s done outside the
organization but for the organization.
The Self Appraisal is followed by the appraisal done by the
superior (appraiser). This appraisal basically includes analyzing various
business dimensions related to financial aspects.
It also includes qualitative aspects of business such as attitude,
customer service, etc. The appraisal also gives feedback on Key
Responsibility Areas (KRA’s), which includes:
The primary responsibilities assigned to the appraisee and
Managerial dimensions for operational and non-operational
assignments.
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Performance Appraisal
Managerial dimensions for operational and non- operational
assignments include:
Job knowledge
Leadership
Decision Making
Administrative skill
Public Relation marketing Skills and
Integrity and Honesty
The Appraiser gives comments on:
Conceptual activities
Emotional Strength
Responsiveness to corporate concerns
Willingness to assume Responsibilities
Creativity and Innovativeness
Communication Skills
The several assessment of performance is done Operational and
Non - operational assignments. This assessment is done by both
appraiser and receiving authority.
The operational assignments include:
Business Dimensions, which has 30 marks,
Qualitative Aspects of Business, which has 20 marks,
Managerial Dimensions, which has 40 marks and
Outstanding Performance, which has 10 marks.
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Performance Appraisal
Non – Operational assignments include:
Key Responsibility Areas, which has 50 marks,
Managerial Dimensions, which has 40 marks and
Outstanding Performance, which has 10 marks.
From the above scores, given by the appraiser, and reviewing
authority. Performance is rated on the scale of:
Outstanding (80 – 100);
Good (60 – 79);
Average (40-59) and
Below Average (Below 40)
After the information so obtained from the assessment of
performance, the company is able to provide training needs and in
able to find out the potentiality of the employees.
The final appraisal is done by the reviewing authority, which
includes remarks and comments on the appraisal done.
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Performance Appraisal
Annexure
Questionnaire
Q. What is the purpose of performance appraisals?
Performance appraisals help to strategically review the
performance of the employees, their strengths, weaknesses and
accomplishments during the year. Performance appraisal allows
deciding the goals, objectives and the desired performance standards
for the employee for the upcoming year.
Q. How should the self appraisal be used?
Self appraisal or self evaluation is the review of the performance
by the employee himself. The self evaluation is discussed with the
employee and if appropriate, is incorporated in the final rating.
Q. Is there any comprehensive formula to calculate the overall
rating?
No, there is no comprehensive formula for doing so. The overall
rating is based on a number of factors like the extent of goals
achieved, the overall performance of the employee, his competencies
etc.
Q. How should the ratings be given if there has been a change
of supervisor or manager during the period of the appraisal?
To complete the performance appraisal subjectively and fairly,
we consult the previous supervisor or manager. If this is not possible,
we consult the supervisor’s superior to get his views and inputs.
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Performance Appraisal
Q. How can input/feedback be collected for the appraisal
process?
Different input forms are used for taking the feedback from the
various sources like the superior, peers, customers, vendors and the
employee himself. All the perspectives thus received are combined in
the appropriate manner and to get an overall, complete view of the
employees’ performance. Observation is done by the superior to obtain
information.
Q. What if the employee refuses to agree or/and accept the
review?
First of all, we ensure that the employee has got a chance to
review his completed appraisal form. If the employee refuses to accept
his appraisal, we try to sort out the problem by discussing his reasons
of dissatisfaction with him calmly. If the employee refuses to co-
operate, then pass the documents to the HR department with a note
on it that the employee has refused to accept and let them take the
necessary action.
Q. How do you deal with an average or a non-performer?
Provide constructive feedback and try to motivate the employee.
Keep the focus on the performance, not the personality of the
employee.
Provide training and development opportunities to the employee
Discuss and take the employee’s inputs on how to solve the
problem.
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Performance Appraisal
Plan the course of action and standards in agreement with the
employee.
If no improvement takes place, inform the human resources or
your superior about the problem.
Q. Should the review be confidential?
The Individual performance reviews is kept confidential and is
not accessible to other employees. It is also stored at a safe place with
limited access. Outdated reviews are destroyed. The appraisal is kept
as a part of the HR records of the employee.
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Performance Appraisal
Section I. SELF ASSESSMENT FORM: (April – March)
Employee Name : Department:
Key Code & DOJ (dd/mm/yy) Location
Designation Head of Department
(Please answer all questions in point form. Be as specific as possible. If you need more space to answer, you may use a blank sheet and attach it to this form. )
1. What were your targets for the last year? List your targets/objectives/performance areas for last year in the left-hand column.
Note your actual achievements in the right hand column. Specify whether the objectives set were reached or not. Use this column to also note missed opportunities for the last year, or targets that in your opinion should have been included.
Objectives/Targets Actual Achievements
A. Quantitative Targets B. Non Quantitative Targets
2. What were the factors, if any, for non-achievement of your targets/objectives for last year? For each factor, you may explain details.
3. What, in your opinion, are your strengths that contribute to your effective performance as an individual and your entire department?
4. What, in your opinion, are your weaknesses and how do they affect your performance?
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5. a. Indicate the peer group interactions in which you received positive assistance.
5. b. Indicate where you did not receive such cooperation?
6. Indicate the areas in which you need training that would enhance your performance?
Organization/Supervisory Skills Communication/Presentation Skills Technology Related Training Technical Skills pertaining your job - be specific
Others - be specific
7. What other assistance do you require from the management to be able to achieve your targets?
8. Outline your targets/objectives for next year?
(April 2006-March 2007)Objectives/Targets
Signature of employee:______________
Date __________
Section II. SUPERIOR'S ASSESSMENT
Employee Name: Department:
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Key Code & DOJ (dd/mm/yy) Location
Designation Head of Department
Date: ____________
1. Evaluate the overall performance of the employee.
2. What, in your opinion, are the areas of strength for the employee and how have they contributed to performance?
3. Outline the areas that require future improvements.
4. What are your recommendations for the employee? (For eg. Job Rotation, Training Needs, other actions.)
5. Modification to Targets/Objectives set by employee for April 2006 - March 2007..
6. a. Overall Ranking of Employee
1 2 3 4 5
6. b. Relative Ranking of Employee as compared to his/her peers
1 2 3 4 5
(Use the following rating scale to rate the employees:
Rating Scale 1-5. 1: Excellent, 2: Very Good, 3: Good, 4: Average, 5: Below Average)
Signature of superior: ___________
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“Feedback is the breakfast of champions.”
Findings
In the whole appraisal system, often superiors assume the role
judges. In contrast the aim is to develop employees; managers
need to be counselors, helpers and teachers.
Maximum employees in the organization were of the opinion that
the performance appraisal is a positive step taken by the
organization to help them to improve their own performance.
Employees were hopeful that after the performance appraisal is
over they will be properly rewarded for their work and that it was a
way to ensure that their efforts don’t go unnoticed.
The employees showed eagerness to learn from their mistakes
which they hoped to rectify and perform better.
Although the employees believe that performance appraisals are
their betterment, in the beginning they had doubts in their minds
about issue of bias being a factor in the process of evaluation.
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BIBLIOGRAPHY
Name : - Mr. Edwin Rozario
Designation :- Executive HR
Address of the Company
Visited :- Sharekhan Limited,
Sharekhan SSKI,
A-206, Phoenix
House,
Phoenix Mills
Compound,
Lower Parel, (West)
Mumbai 400 013
Website: -
www.sharekhan.com
Referred Online Book:-
Ten Minute Guide to
Performance
Appraisals by
Dale Furtwengler
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Performance Appraisal
Books referred: -
Human Resource and Personnel Management by Tata McGraw
Hill Publishing Company Limited.
- K Aswathappa
Organizational Behavior.
- Stephen Robbins
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