Vj TRC Main Project

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PerformanceAppraisal System in TRC

INTRODUCTION

1.1 Introduction to Information Technology Sector

The growth in information technology (IT) industry is perhaps the fastest of all

that with in a span of a decade or so it has become a multibillion-dollar

industry. There are small and big players in this industry, each one is trying

to carve a niche for itself.

There has been a recent spurt, both globally as well as in India, in the use,

demand and implementation of information (IT). This new technology, which

has found its uses in the industry, offices and homes. Is seen to be multi-

billion dollar industry in the years to come. What had started in the 1970s as

essentially hardware or a computer-oriented industry has now become a

multi-dimensional force with an increasing influence on the quality of life.

Indian IT industry is playing a very crucial role in creating National wealth.

The Indian business scenario has undergone a vast change during last few

years. The new economic policy adopted by the government and the policy

of liberalization has brought in new challenges for the Indian corporate world

and the employees. The economic policy has necessitated adopting newand to some extent global concepts of managing human resources in India.

Human resources are an important asset for any industry to survive and

sustain in the long run. The concept of Human Resource Management is

increasingly becoming a most vital function of a modern manager.

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1.2 THEORETICAL BACKGROUND OF THE STUDY

A study on human resource practice in the information technology industry by

a leading consultant group emphasis the importance of keeping pace with

emerging technologies and retains workforce with marketable skills. In this

rapidly changing business scenario, enterprises have realised that dynamic

human resource policy can help create a healthy work force and a productive

proactive work environment. In the organization, concern for employee

appraisal has been quite high.

In recent years, several experiments and innovations have been attempted

and more organization has found. It is necessary to confront these issued in

their formal appraisal systems. Yet there is much scepticism about currentappraisal practices in many organizations. The validity, objectivity and

usefulness of appraisals are often seriously questioned. In short, employee

appraisal indicates that there are more questions than answers.

The early 1970s saw large computer organisation as a dominant players in

the industry. The trend was to provide a range of services to users. Soon in

the early eighties, three major trends started emerging, which revolutionized

the industry.

The first, an increasingly smaller size of hardware became available due to

technology called large-scale integration of circuits or what is commonly

known as chips it is now commonly known that the power of hardware of the

70s, which was as large as an office room, is now down to the power of

personal computer.

The second very noticeable trend that emerged was that the size and cost of

the hardware became irrelevant when compared to the software

development. This made software increasingly powerful and a far more

influential tool in the development and use of system. The early 80s saw the

emergence of powerful hardware and a large variety of software.

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The third major development that took place towards the 80s, which had an

impact on the hardware, and software industry, was the speed and the use of

satellite communication. This made it possible for the users to access a

variety of hardware or software anywhere around the world on ordinary

telephone lines.

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1.3 INDUSTRIAL BACKGROUND OF THE STUDY

In the early eighties, three major trends started emerging, which

revolutionized the information technology industry. It emerged in the late 80s,

as a combination of several facets; hardware, software and communication.

It became evident that information technology had a wide range of scope

covered a variety of hardware, several operating system, innumerable

application software that facilitates development and easies interface with the

user.



years. The new economic policy adopted by the government and the policyof liberalization has brought in new challenges for the Indian corporate world

and the employees. The economic policy has necessitated adopting new

and to some extent global concepts of managing human resources in India.




INFORMATION TECHNOLOGY emerged in the late 80s, as a combination

of several facets; hardware, software and communication. It became evident

that information technology had a wide range of scope covered a variety of

hardware, several operating system, innumerable application software that

facilitates development and easies interface with the user. It specialisation

have facilitated working in many sector such as banking, finance, mining,

steel, transportation, government and what not.

IT Vision: 2020 on the national level encompassing various technology

areas. A detailed survey of key areas in major infrastructure, advanced

technologies and technologies with socioeconomic implications was taken

up. In a span of two years, over 5000 area experts from the industry,

Government, R&D agencies and academia were brought together for a

through survey of shared opinion in select areas.

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Concerted action-plans were formulated on short, medium and long-term

basis up to 2020 AD and seventeen key technology areas of prime

importance to the country were addressed; around 100 sub-sectors were

covered for specific details.

The exercise was carried out in the backdrop of a complex and

heterogeneous social milieu of India and thus a country specific vision

merged. The task forces were constituted for seventeen areas. Each task

was headed by a chairperson and comprised of a go-chairperson,

coordinator and panels of experts looking at major sub-area s covered.

The typical technology forecasting techniques like brainstorming, scenario

rating, Delphi, nominal group techniques (NGT) etc Were adapted to some

extent for the exercise to bring out the vision. The perspective/scenario

reports of the panel, Delphi responses; NGT rankings were formed as the

basis to arrive at suggestions for policy guidelines, strategies, and action

plans for Government NGOs, industry, R&D institutes and academia to

realise the vision for India 2020 AD.

While Technology Vision: 2020 exercise covered classical technology

sectors like Agro-Food Processing, Chemical Industry, Engineering Industry,

Electronics etc., this article focuses on Service sector due to its immense

potential for value-addition and employment generation. The services sector

draws heavily on Information Technology for its advanced applications.

Services the tertiary sectorof the economy covers a wide gamut of activities

like trading, banking & finance, infotainment, real estate, transportation,

security, management & technical consultancy among several others. Thecontribution of services sector today stands over 40 percent of the total GDP

in India. The sector currently employs close to 20 millions people in India for

the advertising, HRD services, testing & certification to Government

administration. For all the aforesaid areas IT plays the prime role in

information processing, storage & access with a view to proving improved

services to the consumers.

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CHAPTER 2 RESEARCH METHODOLOGY

2.1 STATEMENT OF THE PROBLEM

In the organisation, concern for employee appraisal has been quite high. In

the recent years, several experiments and innovations have been attempted

and more organization has found it is necessary to confront these issued in

their formal appraisal system. Yet there is much skepticism about current

appraisal practices in many organizations. The validity, objectivity and

usefulness of appraisals are often seriously questioned. In short, employee

appraisal indicates that there are more questions than answers.

2.2 REVIEW OF LITERATURE

Purpose of Review of Literature

The review of literature was conducted to find out the related literature of the

topic of the study. The literature includes the following:

People at work:

The principal component of the organization is Human Resource or People

at work. Human resource has been defined from the national point of view

as The knowledge skills, creativity ability, talent, and aptitude obtained in the

population. From the view point of individual enterprises it is the

representation of the total inherent ability; anguished knowledge of skills as

exemplified in the talent and aptitude of the employees. Isth is Human

resource, which is of paramount importance. In the success of any

organization most of the problems in the organizational settings are human

and social rather than physical. A failure in recognizing this fact will cause

immense loss to the national enterprises by individuals. People at work

comprise a large number of education and literacy standard. The individual

and in the work place exhibit not only similar behavioural patterns and

character to a certain degree but also show many dissimilarities. Each

individual is not only a product of his behaviour inheritance, but also a result

of interaction with his environment, family, relations, religious information etc.

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People come to work with some specific motive to either earn money or to

have better prospectus in future to be treated as human being at work. They

sell their labour for a reasonable wage and other benefits.

Definition of human resource

Prof. Jucies has defined Human resources as The field of mgnt, which has

to do with planning, organizing, directing and controlling various operative

functions of force.

The human resource management process in an organisation.

A brief introduction to HRD and its role in organization

Human resource development (HRD) might best be viewed as a

comprehensive learning system for the release of the organizations human

potentials, a system that includes both vicarious (classroom, mediated,

simulated) learning experiences and experimental, on the job experiences

that are keyed to the organizations existence (profit, survival, service,

product, and so on). The organization Human Resource Development

mission is:-

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HRP

RECRUITMENT SELECTION

T & D SOCIALIZATION

P.A

PROMOTION, TRANSFER

DEMOTION & SEPERATIONS


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1) To maximize the leasers (employees) effectiveness on the current

job.

2) To facilitate the individuals mobility to the next probable assignment

3) To increase the employees commitment to the organization by

providing stimulating learning opportunities for personal growth and

Change.

In other words, the roles and functions of Human Resource Development are

directed towards the release of the human potential in individuals, groups,

and organisations through learning experiences that result from planned and

organized training, education and developmental activities to put it simply,

the functions of Human Resource Development are:

Training and development, not only organizational but also for individual and

group team. Performance Appraisal is one of the developmental aspects of

Human Resource Development. For, performance appraisal exercise

primarily aims at evaluating individual performance/ performance on the job/

in a group and identifying the need for training of any, for the overall

development of employees. Performance appraisal in itself is a vast topic.

My project revolves around this field, The need for appraisal, its evaluation,

Scope and importance are all explained under the forth-coming topics.

For the purpose of this study, however, we would define performance

appraisal basically, as a formal exercise in the organization that makes an

evaluation, in a documented form, of its employees, and/or their terms of

attributes and behaviour demonstrated, for meeting what ever objectives the

org may consider relevant.

This formal exercise could be carried out at any point of time for period of

time, although it has become customary to do so annually, half-yearly or

quarterly.

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Performance appraisal an overview

How well a business performs depends, crucially on how well its employees

perform. And one of the key factors in determining how well the organizations

employees performs, depends upon the efficiency of its appraisal system

how sharply it can separate effective and ineffective employees. If it can

spot potentially early enough for it to be nursed, trained and developed.

Sound appraisal is necessary for all vital decisions regarding people, whether

it is placement or promotion, remuneration reward, or for identifying areas for

further training, The importance of appraisal has always been recognized yet

there exists considerable confusion and anxiety about how it ought to be

carried out. Also it is an area marked by lack of research in Indian practices.Nevertheless, there have been authors who have attempted to bridge the

gap through their research. And these research materials have come to form

the valuable database for this study.

Definition of performance appraisal:-

Essentially any analysis or review or valuation of performance or behaviour

of an employee, in any manner formal or informal, oral or documented, open

or confidential at any point of time and for any purpose #, is in the nature of

performance appraisal.

The importance of performance appraisal:

Performance appraisal is an essential and inescapable managerial activity.

Appraisal is necessary for all-important decisions relating to people, such as

placement, promotion, reward, remuneration, training, and development, as

well as long-term manpower planning and organization development. In the

recent years, efforts have been made to use appraisal systems for

motivation, for most effective communication, for strengthening the superior

subordinate relationships, for goal setting and work planning and for

improving the total performance of the organization. But in spite of its

performance, uneasiness about appraisal has been a long standing feature

or management, there is no doubt that during the past three decades, many

developments have taken place and many innovations have been made in

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managerial appraisal systems. Still many issues remain unresolved.

Available literature of the subject reveals that even in the western countries,

where systematic appraisals have been widely practiced over a much longer

period than in India and where a fair amount of empirical as well as the

oriental research in the relevant issues has been conducted: serious doubt

priests about various aspects of appraisal.

Issues in appraisal

There are basically three issues in Performance Appraisal, which have been

a major concern and have engaged attention of practicing managers, human

resource specialists, Psychologists and Social Scientists.

1) What are the purposes of an appraisal system?

2) What is to be appraised or measures? (Performance Criteria)

3) How to appraise or measure performance accurately and objectively

(Measured Methods and techniques)?

In fact they are all inter-related issues and each of them influences the othertwo.

Purpose of appraisal:-There are 2 issues relating to purposes:

1) Relates to the different kinds of purposes that appraisal systems canserve

2) Whether and to what extent it is possible to achieve the differentkinds of objectives through the same procedure and process ofappraisal.

Approaches to performance appraisal:

Generally there are three approaches used in making Performance

Appraisal. They are:-

1) Casual approach.

2) Traditional approach.

3) Modern approach.

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Casual approach:-

This was a non-systemic approach without a standard guideline (or) with a

narrow guideline. This is a thing of the past. Now this has given way to

more formal approaches.

Traditional approach:-

This approach is highly systematic and takes into account the employees

characteristics and/or their counter behaviour or both. In this, standard

guidelines are used for all employees so that each employee can be

compared with his fellow employees.

Modern approach:-

This approach is based upon mutual goal setting and appraisal of progress

by both appraiser and appraise. This emphasizes on behavioural values like

fundamental trust in goodness, capability and responsibility of human beings.

Methods of performance appraisal

There are various methods used in Performance Appraisal they are different

because they differ in the sources of traits (or) qualities to be appraised. The

qualities may differ because of difference in job requirements and opinion of

management.

STRAUSS AND SAYLES have classified Performance Appraisal methods

into traditional and modern method. The traditional methods lay emphasis

on the rating of the individuals personality traits such as initiative,

dependability, drive, creatively etc. on the other hand, modern methods

place more emphasis on the evaluation of work results job achievement than

on personality traits.

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TRADITIONAL METHODS MODERN METHODS1) Man to man comparison 1) Assessment centre method2) Easy appraisal. 2) Management by objective.3) Ranking methods. 3) Human asset accounting method.4) Grading methods. 4) Behaviourally anchored rating

scale.5)Forced choice description

method.

5) 360 degree appraisal system.

6) Force distribution method.7) Graphic rating scale.8) Checklist.9) Critical incident method.10) Group appraisal method.11) Work standard method.

12) Field review method.

METHODOLOGY OF LITERATURE REVIEW:

The review of literature was conducted to analyse the various performance

appraisal practices in the IT industries. The books and articles of various

authors are referred to find out the kind of methods which are suited for

rating IT sector employees.

The researcher has searched many books on Performance Appraisal tocollect the literature about the Performance Appraisal. To analyse the

effectiveness of the Performance Appraisal practices in the IT companies

there was no material alike was available in the libraries of the IIMB

Bangalore University and other search engines. The information collected

was confined to the journals published about the human resource

management.

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CONCLUSION

The facts revealed from the review of literature helped the researcher in

building up of problem statement and hypothesis development. The

objectives, the purpose and the importance of the study are clearly evident in

the literature about the Performance Appraisal.

In the beginning stages of the research the question arised was, whether the

study is really a relevant one in the present scenario or not.. But the

literature review provided the researcher with strong back ups to define the

problem and conduct the exploratory and the descriptive research.

In building up of the research question and hypothesis statement, the

literature helped the researcher by providing enough information about the

effectiveness of performance practices in the IT sector.

The literature review also enabled the researcher to identify the potential

topics to be covered in the research, which are deviant from the primary

objectives and the problem statements, but these are important as as study

is concerned. They are also included in the topic for the sake of completion

of the coverage of entire topic, the effectiveness of performance appraisal.

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2.3 OBJECTIVES OF THE STUDY

Primary Objective

Primary objective of the study is to analyse the effectiveness of performance

appraisal practices in information technology industries in Bangalore.

Secondary Objectives

1. Check whether the employees are satisfied with the appraisal system or

not.

2. To find out who conducts the performance appraisal of the employees

in the information technology sector.

3. To find out on what basis employees are rated during the appraisal.

4. To identify various methods used for performance appraisal in

Information Technology industries.

5. To check whether performance feedback is given to the employees or

not.

6. To check whether the employees are assessed for potential or not.

7. To find out whether the objectives of the performance objectives are

met or not.

2.4 NEED OF THE STUDY

It was in the context that the present topic for the project was chosen in order

to analyse and understand an apparently well defined thorough system of

appraisal which in the larger opinion (within the organization) may have

aspects that calls for a change.

The importance of this project is to analyse the Performance appraisal

system in Information Technology industry and find what aspects call for a

change (if any). My study, addressed itself to the following under-related

tasks.

1) Understanding the system.

2) Learning the implications of such a system and

3) Finding if such a thorough elaborate system called for any change.

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2.5 OPERATIONS DEFINITIONS OF THE CONCEPT

IMPORTANCE OF HUMAN RESOURCE MANAGEMENT



years. The new economic policy adopted by the government and the policy

of liberalization has brought in new challenges for the Indian corporate world

and the employees. The economic policy has necessitated adopting new

and to some extent global concepts of managing human resources in India.




Management of human resource includes guiding human resource into a

dynamic organization that attains its objective with a high degree of morale

and to the satisfaction of those concerned with it. The role of human

resources managers has seen profound systematic changes with creativity

and knowledge becoming the drivers of corporate growth. This in turn led to

a radical rethink in the concept of leadership and managing people.

Under this changed scenario, enterprises have realized that a sound Human

resource Management policy can help create a healthy work environment

and a productive workforce. According to Human Resource policies, it is not

only to improve productivity but also for the very survival. To run a

successful business we need human capital. Today, the war for human

capital is as big as the war for business and market share. Attracting,

managing, nurturing and retaining talent has emerged to the most critical

issue for the most Human Resource manager.

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INTRODUCTION TO PERFORMANCE APPRAISAL

Objectives of performance appraisal

Data relating to performance assessment of employees are recorded, stored

and used for several purposes. The main purposes of employee assessmentare:

1. To effect promotions based on competence and performance.

2. To confirm the services of probationary employees upon their

completing the probationary period satisfactorily.

3. To assess the training and development needs of employees.

4. To decide upon a pay raise where (as in the unorganised sector)

regular pay scales have been fixed.

5. To let the employees know where they stand insofar as their

performance is concerned and to assist them with constructive

criticism and guidance for the purpose of their development.

6. To improve communication. Performance appraisal provides a format

for dialogue between the superior and the subordinate and improves

the understanding of personal goals and concerns. This can also

have the effect of increasing the trust between the rater and the ratee.

7. Finally, performance appraisal can be used to determine whether HR

programs such as selection, training, and transfers have been

effective or not.

APPRAISAL PROCESS

Figure 1.1 outlines the performance appraisal process. Each step in the

process is arranged logically. The process as shown in Fig 1.1 is some what

idealized. Many organizations make every effort to approximate the ideal

process, resulting in first rate appraisal systems. Unfortunately, many other

fail to consider one or more or of the steps, and therefore, have less effective

appraisal systems.

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1. OBJECTIVES OF APPRAISAL

Objectives of appraisal, as stated above, include effecting promotions and

transfers, assessing training needs, awarding pay increase, and the like.

The emphasis in all these is to correct the problems.

2. ESTABLISH JOB EXPECTATIONS

The second step in the appraisal process is to establish job expectations.

This includes informing the employee what is expected of him or her on the

job. Normally, a discussion is held with this or her superior to review the

major duties contained in the job description. Individuals should not be

expected to begin the job until they understand what is expected of them.

Objective of Performance Appraisal

Establish Job Expectations

Design on Appraisal Programme

Appraise Performance

Performance Interview

Use Appraisal Data for Appropriate Purposes

The performance appraisal process

3. DESIGN THE APPRAISAL PROGRAMME

Designing an appraisal programme poses several questions, which need

answers. They are

(i) Formal versus informal appraisal

(ii) Whose performance is to be assessed?

(iii) Who are the raters?

(iv) What should be evaluated?

(v) When they evaluate?

(vi) What methods of appraisal are to be used?

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FORMAL VERSUS INFORMAL APPRAISAL:

The first step in designing an appraisal programme is to decide whether the

appraisal should be formal or informal. Formal appraisals usually occur at

specified time periods once or twice a year. Formal appraisals are most

often required by the organization for the purpose of employee evaluation.

Informal performance appraisal can occur whenever the supervisor feels the

need for communication.

Whose performance should be rated?

To the question as to whose performance should be rated the answer is

obvious employees. When we say employees, is it individuals or terms?

Specifically the rater may be defined as the individual, workgroup, division ororganization. It is also possible to be desirable to appraise performance both

at the workgroup level for merit pay increase and at he individual level to

assess training needs.

Who are the Raters?

Raters can be immediate supervisors, specialists from HR department,

subordinates, peers, committees, clients, self-appraisals or a combination of

several.

Immediate supervisor is the fit candidate to appraise the performance of his

or her subordinate. There are three reasons in support of this choice. No

one is more familiar with the subordinates performance than his or her

superior. Another reason is that the superior has the responsibility is given to

another person; the superior authority may be undermined seriously. Finally,

training and development of subordinates is an important element in every

managers job. Since appraisal programmes are often clearly linked to

training and development, the immediate supervisor may be the logical

choice to conduct the performance evaluation.

Subordinates can assess the performance of their superiors. The use of this

choice may be useful in assessing an employees ability to communicate,

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delegate work, allocate resource, disseminate information, resolve intra

personal conflict, and deal with employees on a fair basis.

Peers are in a better position to evaluate certain facts of job performance

which the subordinates or supervisor cannot do.

Although, clients are seldom used for rating employees performance, nothing

prevents an organization form using this source. Clients may be members

within the organization who have direct contact with the rater and make use

of an output (goods or service) this employee provides.

Where appraisal is made superiors, peers, subordinates and clients, it is

called the 360-degrees system of appraisal. First developed at General

Electric, U.S. in 1992, the system has become popular in our country too.

GB (India), Reliance Industries, Crompton Greaves, Godrej Soaps, Wipro,

Infosys, Thermax and Thomas Cook are using the method with greater

benefits.

Many employers use rating committees to evaluate employees. These

committees are often composed of the employees immediate supervisor and

three or four other supervisors who came in contact with the employee. This

choice is welcome when an employee, in the course of his or her job,

performs a variety of tasks in different environments.

In Self-appraisal the employee himself or herself evaluates his or her own

performance. On the positive side, it may be stated that in self-appraisal

there is an opportunity to participate in evaluation, particularly if it is

combined with goal setting ( as in Management by objective or MBO) and

this should improve the mangers motivation.

In practice, a combination of methods is followed for employee assessment.

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What should be rated?

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

evaluation criteria. It is obvious that the criteria should be related to the job.

The six criteria for assessing performance are.

1. Quality: The degree to which the process or result of carrying out an

activity approaches perfection in terms of either conforming to some

ideal way of performing the activity, of fulfilling the activitys intended

purpose.

2. Quantity: The amount produced, expressed in monetary terms,

number of units, or number of completed activity cycles.

3.Timeliness: The degree to which an activity is completed or a resultproduced at the earliest time desirable from the standpoints of both

coordinating with the outputs of others and of maximizing the time

available for other activities.

4. Cost effectiveness: The degree to which the use of the

organizations resource (e.g. human, monetary, technological and

material) is maximized in the sense of getting the highest gain or

reduction in loss from each unit or instance of use of a resource.

5. Need for supervision: The degree to which a job performer can

carry out a job function without either having to request supervisory

assistance or requiring supervisory intervention to prevent an adverse

outcome.

6. Interpersonal impact: The degree to which a performer promotes

feeling of self-esteem, goodwill and cooperation among co-workers

and subordinates.

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Behaviourally Anchored Rating Scales

Behaviourally anchored scales, sometimes called behavioural expectation

scales, are rating scales whose scale points are determined by statements of

effectives and ineffective behaviours. They are said to be behaviourally

anchored in that the scales represent a range of descriptive statements of

behaviour on each scale least to the most effective. A rater must indicate

which behaviour on each scale best describes an employees performance.

Behaviourally anchored rating scales (BARS) have the following features.

1. Areas of performance to be evaluated are identified and defined by

the people who will use the scales.

2. The scales are anchored by description of actual job behaviour that,supervisors agree, represent specific levels of performance. The

result is a set of rating scales in which both dimensions and anchors

are precisely defined.

3. All dimensions of performance to be evaluated are based on

observable behaviour and are relevant to the job being evaluated

since BARS are tailor made for job.

4. Since the raters who will actually use the scales are actively involved

in the development process, they are more likely to be committed to

the final product. Figure 10.10 is an example of BARS.

BARS were developed to provide results which subordinates could use to

improve performance. Superiors would feel comfortable to give feedback to

the raters. BARS help overcoming rating errors. Unfortunately, this method

too suffers from distortions inherent in most rating techniques.

Performance Tests and Observations

With a limited number of jobs, employee assessment may be based upon a

test of knowledge or skills. The test may be of the paper and pencil variety

or an actual demonstration of skills. The test must be reliable and validated

to be useful. Even then, performance tests are apt to measure potential

more than actual performance. In order for the test to be job related,

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observations should be made under circumstances likely to be encountered.

Practicality may suffer if costs of test development or administration are high.

Management by Objectives

It was Peter F. Drucker who first gave the concept of MBO to the world way

back in 1954 when his The Practice of Management was first published. The

MBO concept, as was conceived by Drucker, reflects a management

philosophy, which values and utilizes employee contributions. Application of

MBO in the field of performance appraisal is a recent thinking.

MBO work can be described in four steps.

The first step is to establish the goals each subordinate is to attain. In some

organizations, superiors and subordinates work together to establish goals.

In others superiors establishes goals for subordinates. The goal typically

refers to the desired outcome to be achieved. These goals can then be used

to evaluate employee performance.

The second step involves setting the performance standard for the

subordinates in a previously arranged time period. As subordinates perform,

they know fairly well what there is to do, what has been done, and what

remains to be done.

In the third step the actual level of goal attainment is compared with the goals

agreed upon. The valuator explores reasons or the goals that were not met

and for the goals that were exceeded. This step helps determine possible

training needs. It also alerts the supervisor to conditions in the organization

that may affect a subordinate but over which the subordinate has no control.

The final step involves establishing new goals and possibly, new strategiesfor goals not previously attained. At this point, subordinated and supervisor

involvement in goal setting may change. Subordinates who successfully

reach the established goals may be allowed to participate more in the goal

setting process the next time. T process is repeated.

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2.6RESEARCH DESIGN OF THE STUDY

Research Purpose

Research problems are more likely to be poorly defined; only partially

understood, and missing possible decision alternatives that should be

analysed. Defining problems accurately is a combination of data and

judgement that demands real thought and effort. The concept of analysing

the problems is based on.

1) Recognizing/ understanding a problem:

A problem is a gap between what was supposed to happen and what

did happen between or objective and our accomplishment. Three

elements are required to recognise a problem. Something must be expected to happen.

Feedback must be received on what actually happens.

Expectations and feedback must be compared.

2) Knowing where and when the problem occurred.

Seldom will research problems come neatly packaged with obvious

information requirements, clear-cut boundaries, and pure motives on the

part of the decision-makers. Launching a research study with such shaky

inputs is a recipe for producing unusable findings and unhappy clients. It

is in the best interest of both the researcher and the mangers paying for

the research to be sure that the research purpose is fully understood.

One of the hallmarks of a competent researcher is the ability to get to the

heart of the management problem.

The research objective is a statement, in as precise terminology as

possible, of what information is needed. The research objective should

be framed so that obtaining the information will ensure that the research

purpose is satisfied.

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Two types of researches are conducted

1. Exploratory.

2. Description.

Exploratory research:

Exploratory research is used when one is seeking insights into the general

nature of a problem, the possible decision alternatives, and relevant

variables that need to be considered. Typically, there is little prior knowledge

on which to build. The research methods are highly flexible, unstructured,

and qualitative, for the researcher begins without firm preconceptions as to

what will be found. The absence to structure permits a thorough pursuit of

interesting idea and clues about the problem situation.

Exploratory research hypotheses are either vague or ill defined, or they do

not exist at all. Exploratory research is also useful for establishing priorities

among research questions and for learning about the practical problems of

carrying out the search. What kinds of questions will respondents be able to

answer? What are the barriers to contacting the appropriate respondents?

When should the study be conducted? Etc.

Descriptive Research:

Descriptive research embraces a large proportion of research. The purpose

is to provide an accurate snapshot of some aspect of the environment. In

descriptive research, there may be tentative and speculative research

question.

Thus, the research questions provide guidance to the researcher by

introducing more detail to the research question. The exploratory research is

conducted primarily to study the feasibility of the research work and to

analyse how the respondents respond and what will be the outcomes. Then

a descriptive research is conducted for collection and data and analysis.

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2.7 Formulation of Hypothesis

A hypothesis is a possible answer to a research question. The researcher

should always take the time and effort to speculate as to possible that

research question answers that will emerge from the research. Hypothesis

testing begins with an assumption, called a hypothesis, which is made about

a population parameter. Then data from appropriate sources are collected

and the information obtained from the sample is used how likely it is that the

hypothesised population parameter is correct. The hypothesis test question

is thus a screening question.

Hypothesis Development

The hypothesis statement is a possible question to a research question. Theresearch question is derived from the objectives of the study. How a

hypothesis statement is derived is examined below.

Research Question

Do the IT sector employees are very much aware and satisfied of the

performance appraisal practices in the IT companies?

Basic concepts of hypothesis testing

For testing a hypothesis the following concepts are necessary. They are:

1. The null and alternative hypothesis.

2. The significance level

3. The number of degrees of freedom

4. One or two tail test

These concepts will be examined later in the report.

The tool used for testing of hypothesis-the chi-square test

The chi-square test is a useful measure of comparing experimentally

obtained results with those expected theoretically and based on hypothesis.

It is used as a test statistic in testing a hypothesis that provides a set of

theoretical frequencies with which observed frequencies are compared.

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The chi-square statistic

The chi-square statistic (X2) is a measure of the difference between the

actual numbers observed in cells termed (fo) and the number expected if the

null hypothesis were true. That is under assumption of statisticalindependence; the chi-square statistic is defined as:

X2= [ Fo-Fe 2/1 Fe]

Where,

Fo is the number observed in celli

Fe is the expected number in celli

With degree of freedom df, where df = (r-1) (c-1)

Where,

r is the number of rows

c is the number of columns

The significance level

The significance level indicates the percentage of the sample means that is

outside the cut off limits. There is no single value for selecting a significance

level called alpha (a). The most commonly used levels in academic research

are one present level, five-percent level and ten-percent. For larger samples

the lowest percent levels gives appropriated results. For small samples the

significance level can be high,

The interpretation of the chi-square test

The chi-square test is valid only if the sample size si large enough to get at

least five in each cells of the contingency table obtained from the data. If it

is less than five the frequencies are taken from the adjacent items or cells

that are pooled together in order to make it five or more than five.

The rejection rule in a chi-square test is to reject the null hypothesis if the

computed chi-square value is greater than the table value and vice-versa.

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Determining the target population

Sampling is intended to gain information about a population. Thus it is

critical at the outset to identify the population properly and accurate. If the

population is defined fuzzily, the results will also be fuzzy. If the population is

defined improperly, the research probably will answer the wrong question.

Therefore the definition of a target population should contain information on

sampling elements, sampling units, and area of coverage.

Determining the sampling frame

It is important to distinguish between the population and the sampling frame.

The sampling frame usually is a list of population members used to obtain a

sample. Actually the description of a sampling frame does not have to

enumerate all population members. It may be sufficient to specify the

procedure by which each sampling unit can be located.

The Sampling Procedure

There are many ways of obtaining a sample and many decisions are

associated with generating a sample. The researcher should first choose

between using a probability sampling or non-probability sampling. In

complex situations it is preferred to use a probability sampling procedure. In

probability sampling, all population members have a known probability of

being in the sample. In the most probability sampling procedures, a

sampling frame is needed and information on objects / sampling units is

necessary prior to employing the sampling process.

Probability sampling has several advantages over non-probability sampling.

First, it allows an explicit statement as to how much variation is introduced.Second it allows an explicit statement as to how much variation is introduced.

Various methods can be used to select to probability sample. The simplest,

conceptually, is termed simple random sampling. It not only has practical

value, it is a good vehicle for gaining intuitive understanding of the logic and

power of random sampling.

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Simple random sampling

Simple random sampling is an approach in which each population member

and thus each possible sample, has an equal probability of being selected.

The implementation is straightforward.

The sample size

Determining the sample size answer the question how large the sample

should be. The sample size determination often involves great difficulty.

There are statistical theories that support the sample size decision. The first

and primary thing to consider is that the sample must be a representative of

the population. Further the sample size decision is related to research cost

and therefore must be justified.

2.10 THE INSTRUMENTATION TECHNIQUE USED FOR DATA

COLLECTION

The data from the research can be collected from the organisations only

through the personal interview technique. The instrument used for data

collection is a self-administered questionnaire. For this purpose a

questionnaire needed to be constructed.

Construction of the questionnaire

The questionnaire construction is properly regarded as a very imperfect art.

There are no established procedures that will lead consistently into a good

questionnaire. Although each questionnaire must be developed with specific

research objectives in mind, there is a sequence of logical steps that every

researcher must follow to develop a good questionnaire. They are;

(1) Planning what to measure

(2) Formulate the questions to obtain needed information

(3) Decide on the order and wording of the questionnaire and the layout of

the questionnaire

(4) Using a small sample, test the questionnaire for omissions and ambiguity

(5) Correct the problem (pre-test if necessary)

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The questionnaire method has a major disadvantage that no respondent will

be ready to explain about the open response questions in the questionnaire.

The result will be that most of the open-ended questions will be totally

useless. Keeping that in mind the open-ended questions are not used in the

questionnaire.

The composition of the questionnaire

The questionnaire consists of five types of questions. They are:

1. General awareness questions.

2. Dichotomous questions.

3. Rating scale questions.

4. Ranking questions.

5. Choice questions.

Data collection

The method adopted for data collection was personal interviewing. The

employees of the organizations are personally visited and interviewed with a

self-administered questionnaire. For the data collection, there were some

constraints such as time, cost, and the non-response problems for some

questions.

2.11 Data processing and analysis

In order to understand the current Performance Appraisal system with its

objectives in mind, an attempt was made to obtain a general feedback about

the system. The feedback was collected with the help of questionnaires.

There were designed to elicit information about the functional system, the

degree of it acceptance and its scope for further improvement if required.

The questionnaire was administered to a cross section of employees, the

feedback is presented in the pages to follow. All the tables are based on the

questionnaire administered to the respondents. The respective graphical

descriptions are given on the pages following the table.

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2.12 AN OVERVIEW OF THE REPORT

Once the data have been tabulated, interpreted and analysed, it is required

to prepare report embodying the findings of the research study

recommendations. As a poor report on an otherwise good research will

considerably undermine its utility. It is necessary that the researcher gives

sufficient thought and care to its preparation. Although report writing needs

some skill, which can be developed with practice, the researcher should

follow the main principles of writing a report. Some of these principles are

objectivity, coherence, clarify in the presentation of ideas and use of charts

and diagrams. The essence of a good research report is that it effectively

communicates its research findings, as management is generally not

interested in details of the research design, otherwise there is a strong

likelihood of its remaining unattended on the managers desk. In view of this,

the research has to exercise extra care to make the report a useful and a

worth while document for the management.

CONCLUSION

The research process, as described above involves various steps, though

strict adherence to each of these steps may not be necessary and possible.

A researcher may deviate from the above sequence and steps depending on

his specific needs. It should be remembered that as research proceeds from

the selection of the theme through the collection and analysis of data to the

preparation of a report, the focus of attention will move from one activity to

the other. This implies that the researcher does not always concentrate

exclusively on one particular phase of research until its completion.

2.13 SCOPE OF THE RESEARCH

After the development of the research questions the research problem

become more precise. The scope of the research is that which indicates the

problem with in the boundaries of the research. Much of the interaction

between the researcher and decision maker is about clarifying the

boundaries of the study. A final question of research scope regards the

desired precision accuracy of the results.

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2.14 LIMITATIONS OF THE STUDY

Despite of all the possible efforts to make then analysis more comprehensive

and scientific, a study has bounded to have certain limitations. The

investigator humbly submits them at this stage. They are as follows:

The bias of the respondents may have introduced error in the survey

findings.

Some of the respondents were not cooperative enough. They were

reluctant to respond.

Some of the respondents find it difficult to verbalise the response in

the given movement, so that they were unable to give accurate

information.

Time and cost constraints were a major limitation which prevented a

large sample from been chosen.

Since the respondents were scattered, it was so difficult to approach

each one.

The information provided on Performance Appraisal System are

assumed to be factual and their validities are not questioned. In many

cases respondents were hesitant to give information on sale and profit

margin.

ASSUMPTIONS OF THE STUDY:

The following assumptions have been made in the research study:

It has been assumed that the information given by the respondents

are authentic and genuine.

The research design that has been adopted would help in study

systematically.

The sampling process adopted will help in choosing an appropriate

sample that truly respondents the actual population.

It has been assumed that personal interaction is more suitable for

collecting the required information for the study.

It has been assumed that secondary data that are collected from

various Government Departments are useful in making decision in

both regional and divisional level.

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CHAPTER 3

3.1 PROFILE OF THE INDUSTRYThe growth in information technology (IT) industry is perhaps the fastest of all

that with in a span of a decade or so it has become a multibillion-dollar

industry. There are small and big players in this industry, each one is trying

to carve a niche for itself.

There has been a recent spurt, both globally as well as in India, in the use,

demand and implementation of information (IT). This new technology, which

has found its uses in the industry, offices and homes. Is seen to be multi-

billion dollar industry in the years to come. What had started in the 1970s as

essentially hardware or a computer-oriented industry has now become amulti-dimensional force with an increasing influence on the quality of life.

BACKGROUND: THE THREE LANDMARKS

The early 1970s saw large computer organisation as a dominant players in

the industry. The trend was to provide a range of services to users. Soon in

the early eighties, three major trends started emerging, which revolutionized

the industry.

The first, an increasingly smaller size of hardware became available due to

technology called large-scale integration of circuits or what is commonly

known as chips it is now commonly known that the power of hardware of the

70s, which was as large as an office room, is now down to the power of

personal computer.

The second very noticeable trend that emerged was that the size and cost of

the hardware became irrelevant when compared to the softwaredevelopment. This made software increasingly powerful and a far more

influential tool in the development and use of system. The early 80s saw the

emergence of powerful hardware and a large variety of software.

The third major development that took place towards the 80s, which had an

impact on the hardware, and software industry was the speed and the use of

satellite communication. This made it possible for the users to access a

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variety of hardware or software anywhere around the world on ordinary

telephone lines.

INFORMATION TECHNOLOGY emerged in the late 80s, as a combination

of several facets; hardware, software and communication. It became evident

that information technology had a wide range of scope covered a variety of

hardware, several operating system, innumerable application software that

facilitates development and easies interface with the user. It specialisation

have facilitated working in many sector such as banking, finance, mining,

steel, transportation, government and what not.

INFORMATION TECHNOLOGY VISION

Technology Vision: 2020 on the national level encompassing various

technology areas. A detailed survey of key areas in major infrastructure,

advanced technologies and technologies with socioeconomic implications

was taken up. In a span of two years, over 5000 area experts from the

industry, Government, R&D agencies and academia were brought together

for a through survey of shared opinion in select areas.

Concerted action-plans were formulated on short, medium and long-term

basis up to 2020 AD and seventeen key technology areas of prime

importance to the country were addressed; around 100 sub-sectors were

covered for specific details.

The exercise was carried out in the backdrop of a complex and

heterogeneous social milieu of India and thus a country specific vision

merged. The task forces were constituted for seventeen areas. Each task

was headed by a chairperson and comprised of a go-chairperson,coordinator and panels of experts looking at major sub-area s covered.

The typical technology forecasting techniques like brainstorming, scenario

rating, Delphi, nominal group techniques (NGT) etc. Were adopted to some

extent for the exercise to bring out the vision. The perspective/scenario

reports of the panel, Delphi responses; NGT rankings were formed as the

basis to arrive at suggestions for policy guidelines, strategies, and action

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plans for Government NGOs, industry, R&D institutes and academia to

realise the vision for India 2020 AD.

While Technology Vision: 2020 exercise covered classical technology

sectors like Agro-Food Processing, Chemical Industry, Engineering Industry,

Electronics etc., this article focuses on Service sector due to its immense

potential for value-addition and employment generation. The services sector

draws heavily on Information Technology for its advanced applications.

3.2 GROWTH, DEVELOPMENT & PRESENT STATUS OF THE INDUSTRY

SERVICE SECTOR:

Services the tertiary sectorof the economy covers a wide gamut of activities

like trading, banking & finance, infotainment, real estate, transportation,

security, management & technical consultancy among several others. The

contribution form services sector today stands over 40 percent of the total

GDP in India. The sector currently employs close to 20 millions people in

India. The advertising, HRD services, testing & certification to Government

administration. For all the aforesaid areas IT plays the prime role in

information processing, storage & access with a view to proving improved

services to the consumers. Some of the typical IT applications in major

services sector are outlined in the following sections.

FINANCIAL SERVICES:

Financial services have been the major users of IT and communication

technologies. IT expenditure by US banks has recorded a compounded

annual growth rate of 8.4 percent. The Management Information System

(MIS), distributed computing devices, open systems, high-speed data

networks (LAN, NIAN, WAN, ISDN etc.), RDBMS have been important

development milestones in IT with major impact of financial services.

The development of optical fibre has greatly improved the communication

speed, anticipated to touch 2 trillion bites per second eventually. Packet

switching transmission methods like asynchronous transfer mode achieving a

speed up to 622 million bits per second have been the major breakthrough in

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communication technology. CD-ROMs with storage capacity of 1.6 GB of

data have been instrumental in fast information retrieval and access. Use of

multimedia for storage of text, graphics, video, sound etc. has immensely

benefited the information storage system. All these technologies are used

extensively by the banking and financial services sector.

Automated Teller Machine (ATM):

ATMs though operational in the country for quite some time, are expected to

make a big head-way in India. It has been estimated that there are around

400,000 ATMs worldwide out of which 100,000 are located in Japan alone.

The latest generation networked ATMs allow the user to perform up to 150

kinds of transactions ranging from simple cast withdrawals & deposits, tofund transfer to trading in stocks to buying mutual funds to something

mundane like payment of electricity bills, booking air-tickets and making hotel

reservations.

ATMs are synonymous with credit cards 578 million credit cards issued

worldwide were involved in a transaction of US $ 1092 billion by June, 1993.

India is poised to become one of the worlds largest credit card users by

2000 AD.

Virtual Bank

Multimedia technology has been quite effective in bringing the banking

services to the doorstep of its customers. The Customer Activated Terminal

(CAI) or Kiosk is an interactive multimedia display unit, housed in a small

enclosure, typically consisting of a computer workstation, monitor, videodisk

player and a card reader. It allows the customers to browse through

information and use the available banking services at their own speed.

Some banks are thinking of establishing virtual branches where a customer

can at any time call up a member of the bank staff by video conferencing.

While the banks do not need to invest heavily in real estate for setting up

such a branch, the customer gets the benefit of one-stop banking at a

convenient location.

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Home Banking

Smart phones with screen built-in modems and programmable

microprocessors let the customer access a variety of financial services from

home.

Electronic Funds Transfer at Point of Sale (EFTPOS)

While travellers cheques meant pay-now-buy-later and credit cards had

buy-now-buy-nowbut without cash transaction. The user presents his ATM

card when he buys goods and the EFTPOS system immediately debits his

bank account.

Smart Cards

The processor type Smart Cards with in-built integrated circuits (ICs) or

microchips offer a wide range of transactional opportunities even from

remote areas. The Smart Cards are extensively being used for employee

clocking in, withdrawing cash from ATM, using pay-phones, payment of

various bills etc.

Electronic Data Interchange (EDI)

EDI typically denotes paperless financial transactions across the location.

EDI is fast becoming the norm for inter-company transactions and also for

procurement of bought-out items from the suppliers. The companies can

now operate their ban accounts through corporate banking terminals in their

own offices, which are like transferring funds, managing its cash flow,

opening Letters of Credit etc. Without any paper work, Singapore has

established Trade-Net to facilitate electronic submission of trade documents

by traders to various Govt agencies and the response of these agencies to

the sender. It has reduced document-processing time from one day to 15-30

minutes and the estimated savings are of the order of $ 1 billion annually.

Image Processing

As financial services including capital markets and banking are highly

document intensive, image-processing technology can have a far reaching

impact for such applications for its less paperhandling characteristics.

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In banks, image technology could be used for automatic identification or

character recognition to read text and diagram wherein the cheques or

documents can be scanned.

Expert Systems

The financial services sector is increasingly using decision support systems

(DSS) or expert systems for functions such as credit risk appraisal,

forecasting loan delinquencies, investment decisions etc. one of the most

promising developments in this field is the use of neutral network approach

to build an expert system, which lets the software literally learn from an

example an experience several banks today are using neutral network

programmes to detect credit card fraud. It is also being used by some leadinginvestments banks to track stock price patterns and predict their movements.

Information Technologies & Financial Services: Key Issues

While the technological possibilities of IT may be unlimited, their applications

and adoption in India need a conscious approach towards Business Process

Reengineering of existing practices and procedures to take the fullest

advantages of IT. Continuous training & skill up gradation of human

resources assume critical importance towards absorption of new

technologies.

The elimination of manual records, the introduction of electronic fund

transfer, ATMs etc. Raise the important issues of security and integrity of

data. This includes issues relating to confidentiality of information,

preventing data corruption and prevention of fraud. Appropriate technologies

for encryption of data for secured transaction, regular & multiple backups,

extensive use of passwords and other forms of authorization would need to

be adopted.

For paperless and electronic financial transaction in India, a host of legal

aspects need to be looked into. As in case of EFT, a cheque in not required

to be presented physically for making payment as per the current practice.

Also the legal liabilities of banks and customers in case of loss of ATM card,

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ATM frauds etc. are not quite understood in the present system. The

adoption of new technologies would warrant a thorough review of the system

towards changed legal stipulations.

Finally, the most important aspect of costs involved and benefits expected

need a closer scrutiny. Expenditure of IT has always not been in tune with

the returns envisaged. The American example of spending US $ 100 billion

on IT applications in financial services during 1970-80 has been a pointer.

With 10 percent more expenditure on IT per worker, it increased productivity

by only 0.7 percent per year. Hence, proper implementation programme and

technology management aspects assume much importance.

Advertising, Media & Infotainment

The areas of advertising, media & infotainment are interrelated and their

growth & momentum are closely linked with economy, demography, life-style

and simultaneously with technological innovations. The levels of literacy and

poverty alleviation also have direct bearing on mass media. And again, IT

applications would have far reaching impact on these services sectors.

Future Scenario for IndiaTelevision would forge ahead with its domineering role in mass media

relegating the print media much behind. With more and more channels

getting available coupled with strong emergence of cable networks for

localized programmes, TV would pave the way for multi-million

entertainment, advertisement & allied business. While rural sector would

account for nearly 50 percent of TV ownership, it is predicted that not more

two-thirds of all the households across the country would own a TV by 2020.

TV (including satellite and cable transmission) would account for 40 percent

of advertisement outlays in 2020 against 22 percent at the current level.

Online electronic newspapers may become a reality in India with the

advances in telecom services but such dramatic changes are unlikely for at

least another five years. Steep rise in input costs, declining advertisement

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support (anticipated to reduce by 20 percent) and shortage of trained

manpower would pose major threats to the newspaper industry.

Multimedia technology enabling simultaneous exchange of voice, text and

data would prove to be a major medium of advertisement. Ad spend on

multimedia is expected to be around 5% by 2000 and to reach 12-15 % by

2020 AD. Ultimately the market would see an increase from rs.350 million to

rs.120-150 billion by 2020.Around 50-75 million households are expected to

be potential users of multimedia by 2020.

The services sector covers a vast range of occupations involving

comparatively little capital investment leading to gainful employment and has

a very good potential for export revenues. The sector calls for continued

induction and infusion of knowledge- based technologies with cutting edge

applications of information technology. With the highly skilled manpower and

excellent entrepreneurship+ qualities, India can truly emerge as a global

player in the services sector.

3.3 FUTURE PROSPECTS AND PLANS OF THE INDUSTRY

1. Networked ATMS for banking and other transactions

2. smart phones for home banking operations

3. virtual branches of bank operating from Customer Activated Terminal

(CAT) or a kiosk

4. Debit Cards for EFTPOS

5. Smart Cards with built in micro chips for paperless cash , pay phones etc

6. Electronic Data Interchange (EDI) for paperless banking transactions

7. Image processing technologies for optical scanning and storage of

digitised images

8. Expert systems and neural networks for credit risk appraisal, monitoring/

prediction of stock price movement and detection of credit card fraud

9. Business Process Engineering, training and skills development for

absorption of new technologies Information security for confidentiality,

prevention of dates corruption and fraudulent practices

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10.Information Security for confidentiality , prevention of data corruption and

fraudulent practices

11.Legal aspects for paperless & electronic financial transactions

12.Single optical fibre connection to homes to blur the differences between

communication & infotainment cables offering the whole range of

services like home shopping, music & movies on demand, interactive

TV.

13.Telemarketing & Visual Shopping would be in great demand.

14.Online Electronic newspaper & Magazines to dominate over print media.

15.Multimedia technology & Virtual Reality to emerge as the major medium

of advertisement.

16.Availability of Interactive Television & user controlled on-demand

interactive advertising.

17.Direct broadcast satellites, PCs for reading electronic book, digital

camera for storing, viewing & editing still photographs on discs to be

available.

18.Bar coding to emerge as an important device for payment processing,

accounting & inventory management.

19.Decentralized warehouses to act as hubs for rural distribution to be

networked to manufactures and retailers by VSATs.

20.Complete networking of supply chain viz. retailers, distributors,

warehouses, transporters, manufactures, material suppliers etc.

21.Use of demographic database for age & sex composition, income levels

& distribution, regional disparities, fertility & mortality rates, incidence of

diseases, life expectancy etc. Would come handy for designing new

insurance products & services.

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CHAPTER 4

ANALYSIS OF FINDINGS

4.1 ANALYIS AND INTERPRETATION OF DATA

In order to understand the current Performance Appraisal system with its

objectives in mind, an attempt was made to obtain a general feedback about

the system. The feedback was collected with the help of questionnaires.

There were designed to elicit information about the functional system, the

degree of it acceptance and its scope for further improvement if required.

The questionnaire was administered to a cross section of employees, the

feedback is presented in the pages to follow. All the tables are based on thequestionnaire administered to the respondents. The respective graphical

descriptions are given on the pages following the table.

Hypothesis Development

The hypothesis statement is a possible question to a research question. The

research question is derived from the objectives of the study. How a

hypothesis statement is derived is examined below.

Research Question

Do the IT sector employees are very much aware and satisfied of the

performance appraisal practices in the IT companies?

Hypothesis

IT sector employees are very much aware and satisfied of the performance

appraisal practices in the IT companies.

Seven questions are converged up on this hypothesis. The tool used to testthe accuracy of hypothesis statement was chi-square. The presentation and

analysis of the data collected are given below

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1). Have you been appraised?

Table 1

Frequency Percentage (%)Yes 30 100

No 0 0Total 30 100

Analysis

The above table says that 100% of the employees in information technology

have been appraised

25

30

35

Interpretation

Since 100% of the respondents have appraised, we can easily come to the

conclusion that in information technology industry performance appraisal

system is being used.

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2) Have you been appraised Formally or Informally

Table 2

frequency PercentageFormally 30 100

Informally 0 0Total 30 100

Analysis

The above table 100% of the respondents are formally apprised

Interpretation

It shows that information technology industry formal appraisal system is in

existence.

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3) Are you satisfied with an annual appraisal system?

Table 3


No 0 0Total 30 100

A

Analysis

In the above table states that 100% of the employees are satisfied with an

annual appraisal system.

Interpretation

The blue shaded portion in the pie chart clearly pointing out those employees

in information technology industries are satisfied with the annual appraisal

systems.

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4) Are you satisfied with appraisal system?

Table 4

Frequency Percentage (%)

Yes 28 93No 2 7Total 30 100

Analysis

In the above table shows that 93 % of the employees are satisfied with

appraisal system. And 7% of the respondents are unsatisfied.

Interpretation

By and large performance appraisal system seems to be satisfied across the

employees except 7% of the respondents. Since the percentage ofrespondents who find the systems unsatisfactory is less. So we can easily

come to the conclusion that all the employees are satisfied with the appraisal

system.

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5) Who appraise you?

Table 5

Rating done by Frequency Percentage (%)Unit head 0 0

H R department 8 27Head of thedepartment

8 27

Self 2 6Immediate supervisor 12 40Total 30 100

10

12

14

frequency

Analysis

In the above table 12 respondents are rated by immediate supervision. While

8 are appraised by human resources development and head of the

department and 2 respondents are appraised by self.

Interpretation

In the entire information technology sector, most of the employees are rated

by immediate supervisors and rest of the employees are rated by human

resources department, head of the department and very few people are rated

by self.

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6) Are you aware of the parameters on which you rated?

Table 6


No 2 7Total 30 100

Analysis

In the above table shows that over all 93 % of the employees are aware of

the parameters based on which they are rated. Only 7% of the respondents

are unaware.

InterpretationThis shows that majority of the employees are aware about the parameters

on which they are aware. Only few respondents are not aware of. So the

human resources department should take care that all employees in the

organisation should know about the parameters on which they are rated.

7) Are you satisfied with what is being appraised?

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Table 7Frequency Percentage (%)

Yes 28 93No 2 7Total 30 100

Analysis

In the above table shows that 93 % of the employees are satisfied with what

is being appraised and 7% of the respondents are unsatisfied.

Interpretation

It looks that almost all the employees are satisfied with what is being

appraised.

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8) What is the rating method adopted?

Table 8

Rating methods Frequency Percentage (%)

360 degree appraisalsystem.

14 47

Rating scale 6 20Check list 4 13Management byobjective

6 20

Total 30 100

1414

16

frequency

Analysis

The above tables it is clearly under stood 47% of employees are rated by

360 degree appraisal system. While 20% each are appraised by

management by objective and rating scale and 13% of the employees are

rated by checklist method.

Interpretation

In the I T industries 360-degree appraisal system is popular. But some

companies are using management by objectives and rating scale

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9) Are you satisfied with the method?


Yes 28 93No 2 7Total 30 100

Analysis

In the above table shows that 93 % of the employees are satisfied but 7% of

the respondents are unsatisfied.

Interpretation

In the information technology industries almost all the employees are

satisfied on their methods, which they are rated..

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10) Do you think that formal performance feed back should be given ?


Yes 28 93No 2 7Total 30 100

Analysis

In the above table shows that 93% of the respondents think that the formal

performance appraisal feed back should be given except

Interpretation

All the information technology industry majority of the employees want formal

performance feed back to know about their performance.

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11) Is your incentive based on?

Table 11Based on Frequency Percentage (%)Team work 26 87%Individual work 4 13%Total 30 100

Analysis

The above table shows that 87% of the respondents incentives are based on

their team work. While 13% of the respondents incentives are based on their

individual work.

Interpretation

Almost all the information technology industry employees are giving the

incentives to the employees based on their team work.

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12) Are you assessed for potential?

Table 12

Frequency Percentage (%)

Yes 30 100No 0 0Total 30 100

3030

35

Analysis

In the above table 100% respondents are assessed for potential.

Interpretation

All the employees in the information technology industries are assessed for

potential.

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Testing of hypothesis

IT sector employees are very much aware and satisfied of the performance

appraisal practise in the IT companies

Obtaining the contingency table

There should be at least a frequency of five in each cell of the contingency

table

The contingency table obtained

IT sector employees are

Verymuch satisfied Very much aware FOCell

NO 6 6 12YES 84 54 138

90 60 150

Step .1 laying down null and alternative hypothesis

Null hypothesis, H : IT sector employees are not very much aware and

satisfied of the performance appraisal practices in the it companies

Alternative hypothesise, Ha : IT sector employees are very much aware and

satisfied of the performance appraisal practices in the IT companies

Step.2 calculation of chi-square table value

Degrees of freedom df=(r-1)(c-1)

Where r=number of rows

C=number of columns

The level of significance a = 5% that is 0.05

The degree of freedom df = (r-1)(c-)

= (2-1)(2-1)

= 1*1=1

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The chi-square table value 0.05

1 = 3.841

Step.3 chi-square calculated value

The chi-square calculated value, x2 = [(Fo-Fe)2 /fe]

Where Fo = observed frequency in cell

Fe = expected frequencies in cell

Fe = expected ratio that back up the hypothesis is 1:4

N = number of cell elements

The table used for calculation

Fo Fe Fo-Fe [Fo-Fe]2 [(Fo-Fe)2/Fe]12 30 -18 324 10.8138 120 18 324 2.7

[(Fo-Fe]2/fe] = 13.5

Step.4 Rejection rule of the chi-square table

Ho accepted only if the table value is greater than chi-square computed

value and reject Ho if the chi-square table value is less than the chi-square

computed value.

Here the chi-square calculated value is 13.5 the table value is 3.841 so we

reject the null hypothesis, Ho.

Step.5 ConclusionWe reject the null hypothesis. That is we reject the statement IT sector

employees are very much aware and satisfied of the performance appraisal

practices in the IT companies. So we accept the alternatives hypothesis.

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Chapter 5

Summary and conclusion

Findings of the study

performance appraisal is a formal structured system of measuring and

evaluating an employees job related behaviours and outcomes to discover

how and why the employees is presently perfoming on the job and how the

employees can perform more effectively in the future so that the employees,

organization and society all benefit.

Performance appraisal is a systematic evaluation of the individual with

respect to his performance on the job and his potential for the development.It is a continues process that determines training, promo ability, transfers,

wage increases etc.

1 To provide feedback for growth & development.

2 To link rewards to effective performance of individuals departments and

the organisation as a whole.

3 To highlight the out standing performers in order that others may role

model them.

The study is conduc

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