khushi project

7/29/2019 Khushi Project

1/116

1

INTRODUCTION

ABOUT THE INDUSTRY

Life is very fragile and death is a certainty. We cannot control the uncertainties of life.

But, we can cover the risks surrounding us. Life insurance, simply put, is the cover for

the risks that we run during our lives. It protects us from the contingencies that could

affect us.

Life insurance is not for the person who passes away, it for those who survive. It is

the responsibility of every bread earner to guard against the events that could affect

the family in the unfortunate circumstance of his / her demise. Thus, having a life

insurance policy is very vital. Before going for a life insurance policy it is imperative

that you know about various types of life insurance policies.

Life insurance is an essential part of financial planning. The main purpose of

purchasing life insurance is to ensure that your dependents are financially protected in

the event of death. Life insurance is a way to plan for the future so you need to be sure

that the coverage you purchase fits your needs.

There are many options available to you when purchasing life insurance. Some

policies provide coverage for your lifetime and others provide coverage for a specific

number of years. With certain policies, you are able to combine different kinds of

insurance and even build up your cash value. Your choice should be based on your

needs and what you can afford.


2/116

2

DIFFERENT POLICIES

Term Life Insurance

Term life insurance is an insurance policy that is in effect for a specific period of

time. If the insured dies within that timeframe, the beneficiary of the policy receives

the death payment. However, if the insured survives that period of time, the

beneficiary receives nothing and the policy is closed. Term life also provides the

ability to convert to a permanent kind of coverage at a later time. The main reasons

people buy term life insurance include:

Coverage for a specific amount of time until they are able to build up their assets.

Coverage for the amount of time the mortgage is for so in the event of an untimely

death, the mortgage is taken care of.

Coverage for those that cannot afford a permanent policy, especially newlyweds

and new parents.

Permanent Life Insurance

Permanent life insurance covers a longer period of time than term life or for the entire

life of the insured. This kind of insurance combines death benefits with a savings

component. The amount of money that is not used to cover the amount of the

insurance is invested by the company and builds up a cash value that may be used in a

variety of ways. You may borrow against a policy's cash value by taking a policy

loan. If you don't pay back the loan and the interest on it, the amount you owe will be

subtracted from the benefits when you die or from the cash value if you stop paying


3/116

3

premiums and take out the remaining cash value. The cash may also be used to

increase your retirement income or to help pay for needs such as a child's tuition

without canceling the policy. However, to build up this cash, you'll pay higher

premiums. There are several types of permanent life insurance, including whole,

universal, variable universal, and survivorship universal.

Whole Life Insurance

A whole life insurance policy remains in full force and effect for the life of the

insured, with premium payments being made for the same period. Some whole life

policies let you pay premiums for a shorter period such as 20 years, or until age 65.

Premiums for these policies are higher since the premium payments are made during a

shorter period of time.

Universal Life Insurance

The premiums of a universal life insurance policy are split in two ways. The premium

you pay goes toward covering the cost of the insurance policy and the remaining

balance is invested and earns interest on a tax deferred basis. With this type of life

insurance you also receive a guaranteed minimum interest rate on the balance that is

invested.

Variable Life Insurance

Variable life insurance is an investment-oriented whole life insurance policy that

provides a return linked to an underlying portfolio of securities. The portfolio is a


4/116

4

group of mutual funds including common stocks, bond funds, and money market

funds. This type of life insurance offers fixed premiums and a minimum death benefit.

The better the total return on the investment portfolio, the higher the death benefit or

value of the variable life policy.

Variable Universal Life Insurance

Variable universal life insurance is a combination of universal life insurance and

variable life insurance in that excess interest credited to the cash value account

depends on investment results of separate accounts (equities, bonds, real estate, etc.).

You have a choice as to how the cash value is invested -- stock and bond mutual

funds. However, there is no guaranteed minimum interest rate with a universal life

insurance policy.

Survivorship Universal Life Insurance

Survivorship universal life insurance provides a policy in which two people are

covered on one policy. The death benefit is paid upon the second death. The

premiums for this joint life policy are significantly lower than a regular policy. Many

people take this type of life insurance to help pay estate taxes after the deaths of both

a husband and wife.


5/116

5

A BRIEF HISTORY OF THE INSURANCE INDUSTRY

The origin of insurance is very old. The time when we were not even born; man has

sought some sort of protection from the unpredictable calamities of the nature. The

basic urge in man to secure himself against any form of risk and uncertainty led to the

origin of insurance. The insurance came to India from UK; with the establishment of

the Oriental Life Insurance Corporation in 1818. The Indian life insurance company

act 1912 was the first statutory body that started to regulate the life insurance business

in India. By 1956 about 154 Indian, 16 foreign and 75 provident firms been

established in India. Then the central government took over these companies and as a

result the LIC was formed. Since then LIC has worked towards spreading life

insurance and building a wide network across the length and the breadth of the

country. The General insurance business in India, on the other hand, can trace its roots

to the Triton Insurance Company Ltd., the first general insurance company

established in the year 1850 in Calcutta by the British. In 1957 General Insurance

Council, a wing of the Insurance Association of India, frames a code of conduct for

ensuring fair conduct and sound business practices. In 1972 The General Insurance

Business (Nationalization) Act, 1972 nationalized the general insurance business in

India with the effect from 1st January 1973. it was after this that 107 insures

amalgamated and grouped into four companies viz. the National Insurance Company

Ltd. and the United India Insurance Company Ltd. GIC incorporated as a company.


6/116

6

LIFE INSURANCE BASICS

We buy life insurance because we want to make sure that our loved ones, especially

dependents, remain financially secure after we die. Income replacement is the

number1 reason why people buy life insurance. Non-working caregivers also have an

important, and oft overlooked economic value that should be covered by life

insurance. Life insurance is also purchased by those interested in achieving specific

business or estate transfer goals.

There are several choices when it comes to buying life insurance and there are huge

pricing differences in the market among different companies offering identical

coverage. Policies are now available from more than 1,500 life insurance companies

in the United States. Most financial planners recommend that each family income

provider carry no less than ten times their annual income in life insurance.

Heres an orderly way to go about shopping for life insurance: 1) assess your life

insurance needs, 2) decide on the most appropriate policy type, 3) set high standards

for the financial stability ratings of your insurance company and, then 4) shop until

you drop to find the best price.

Life insurance is a long-term proposition, which means that you should pay particular

attention, at time of purchase and throughout the life of the policy, to the financial

stability ratings of your life insurance company. While the average U. S. adult shops

for life insurance once every seven years, its not uncommon for people to keep life

policies in force for decades.


7/116

7

ASSESSING YOUR LIFE INSURANCE NEEDS

The first step in life insurance planning is to analyze your life insurance needs or

rather, the economic needs of the dependents left behind:

Before purchasing a life insurance policy, you should consider your financial situation

and the standard of living you want to maintain for your dependents or survivors. For

example, who will be responsible for your final medical bills and funeral costs?

Would your family have to relocate or otherwise change their standard of living? The

assumption of immediate death is necessary to determine the current life insurance

needs for the family or individual.

Beyond the initial readjustment period, consideration has to be given to the longer

term financial needs of the remaining family members. Items of consideration should

include dependency period income for children, income for the surviving spouse,

mortgage and other debt payoffs, college education funds and an additional

emergency fund.

Because life insurance needs change over time, your life insurance program should be

reevaluated periodically. We recommend a review at least once every five years or

whenever you experience a major life event such as change income or assets,

marriage, divorce, the birth or adoption of a child, or purchase of a major item such as

a house or business.


8/116

8

The Illinois Department of Insurance points out the reasons you might buy life

insurance will vary, depending on your age, financial situation and other factors.

Listed below are some examples:

Single person with no dependents: Funeral expenses; medical bills; debts, such as

credit cards or student loans; elderly parents who may be dependent upon you for

support. Note: Buying life insurance at a young age is cheaper. As you get older or

possibly incur a serious health condition, it will be more expensive or difficult to buy

a policy.

Single person with dependents: Funeral expenses; medical bills; outstanding debts;

caretaker expenses for your surviving dependents; education costs for surviving

children.

Couple with no children: Funeral expenses; medical bills; outstanding debts,

especially mortgage or car payments.

Couple with children:Funeral expenses; medical bills; outstanding debts, especially

mortgage payments; child-rearing expenses; education costs. Note: Even if one

partner does not work outside the home, you may want to consider life insurance to

help pay for childcare or other services performed by that partner.

Older couple: Funeral expenses; medical bills; impact on spendable income;

outstanding debts, such as a new home, second vacation home, or recreational

vehicle; impact on assets you may want to leave for children or grandchildren


9/116

9

In theory, you should have a declining need for life insurance as you age because

fewer people remain dependent upon you for income support. Exception to this rule

would be for circumstances in which you want to protect a business entity or pay

estate taxes for heirs. If the purpose of buying life insurance is to pay estate taxes,

then youll only want coverage that is guaranteed for the remainder of your life and

that of your spouse as well.


10/116

10

COMPANY PROFILE

COMPANY PROFILE

MAX INDI A LTD.

Max India Limited is a multi-business corporate, driven by the spirit of enterprise, focused on

Knowledge, People and Service oriented businesses of Healthcare and Life Insurance. Max

also maintains interests in Clinical Research, IT and Telecom Services, and Specialty Plastic

Products businesses

Healthcare

Life Insurance

Clinical Research

IT & Telecom Services

Specialty Plastic Products

Healthcare, at present, is our local business, centered in and around Delhi. Life Insurance has

a national reach. Information Technology and Clinical Studies are international in scope.

Taken together, they are the 'flags' of Max:

LOCAL

-Max Healthcare

-Max Ateev

NATIONAL

-Max New York Life

INTERNATIONAL

-Neeman Medical International

-Max Ateev


11/116

11

Max is a young, modern Indian corporation, with a strong capability of recognizing

opportunities ahead of their time. Max has been able to form and strengthen international

alliances with global leaders across a wide spectrum of management activity. Max India is ledby a skilled team of professional managers and is recognized for commercially successful

manufacturing and service delivery businesses. Max has created enviable history marked by

tremendous growth in various fields and has been ranked among the "Top Two Hundred Most

Valuable Indian Companies" by Business India (October 2000).

Max's deep understanding of Indian consumer combined with a large pool of professionals

and an enterprising spirit have helped complement its relationship with industry leaders of

global stature like New York Life International LLC. of U.S.A. With a unique experience of

growing through the 'JV route' Max is proud of the excellent relations it has with each of its

partners. Max India already has successful and enduring partnerships with some of the most

respected specialist organizations in the world, some of which are Gist Brocades of the

Netherlands, Atotech Deutschland GMBH, Germany, and Hutchinson Telecommunications

Ltd., Hong Kong, Singapore General Hospital, Harvard Medical International Inc., USA.,

Lockheed Martin Global Telecommunications.

VISION

To be one of India's most admired corporate for service excellence and a successful multi-

business enterprise for its stakeholders i.e. customers, shareholders, employees, JV partners,

etc.

MISION

Establish niche service business in 2 areas of Healthcare, and Life Insurance. Rank in top 3

players in each niche. Partner with "Best in Class" world leaders. Maintain Traditional

Business

NEW YORK LI FE


12/116

12

New York Life Insurance Company, has been ranked at Fortune 68, in the 2005 Fortune 500

listing of companies, is one of the largest providers of life insurance coverage in America.

Founded in 1845, the Company has over US$215 billion in assets under management.

The mission of New York Life is to maintain its superior 'financial strength', adhere to the

highest standards of 'integrity' and demonstrate 'humanity' by treating its customers, agents

and employees with compassion, consideration and respect.

New York Life Insurance Company has been among the highest rated companies by leading

independent rating agencies including - A.M. Best Company (A++), Fitch (formerly Duff &

Phelps) (AAA), Moody's Investors Service (Aa1) and Standard & Poor's (AA+) The company

has its headquarters in New York City and has operations in the United States, Argentina,

Hong Kong, SAR, India, Indonesia, Mexico, The Philippines, South Korea, Thailand and

Taiwan. The company maintains representative offices in the People's Republic of China and

Vietnam.

For the last 47 years, New York Life has had the highest number of agents who qualify

as members.

As a leader in the insurance industry, New York Life continues to bring to its operations new

management concepts, advanced technologies, new distribution and training systems and

innovative insurance products of the 'Million-Dollar Round Table'. The MDRT is the world's

most prestigious organization of insurance sales professionals.

MAX NEW YORK LIFE INSURANCE CO. LTD.


13/116

13

Max New York Life Insurance Company Ltd is a Joint Venture between New YorkLife, a Fortune 100 company and Max India Limited, one of India's leading multi-

business corporations. Through its wide network of highly competent life insurance

Agent Advisors and flexible products and solutions, Max New York Life is

committed to creating a partnership for life with its customers in India.

In line with its values of financial responsibility, Max New York Life has adopted

prudent financial practices to ensure safety of policyholder's funds. It invests only in

debt instruments and meets both Indian and international disclosure norms. The

Company's paid up capital is Rs.527crore, which makes it among the highest

capitalized life insurer in India.

Max New York Life has identified Individual agents as its primary channel of

distribution. The Company places a lot of emphasis on its selection process, which

comprises four stages - screening, psychometric test, career seminar and final

interview. The agents are trained in-house to ensure optimal control on quality of

training. Max New York Life invests significantly in its training programme and each

agent is trained for 152 hours as opposed to the mandatory 100 hrs stipulated by the

IRDA before beginning to sell in the marketplace. Training is a continuous process

for agents at Max New York Life and ensures development of skills and knowledge

through a structured programme spread over 500 hours in two years. This focus on

continuous quality training has resulted in the company having amongst the highest

agent pass rate in IRDA examinations and over 126 of its agents becoming MDRT

members in 2005, which is among the highest among the private life insurers in the

country.

Max New York Life offers a suite of flexible products. It now has 22 life insurance

products and 9 options & 8 riders that can be customized to over 400 product

combinations enabling customers to choose the policy that best fits their need.

The 22 products are - Life Maker - Investment Plan, Life Maker - Pension Plan,

Whole Life Par, Level Term, Term Renewable and Convertible, Super saver bond,

Life Gain Endowment Plan, Life Pay Money Back Plan, 20 years Endowment Plan,


14/116

14

Life Partner Plus (Participation) Policy, Easy Life - Retirement Plan, Endowment to

age 60 Plan, Life Maker - Pension Plan, Immediate Annuity, Children's endowment

18 & 24, Stepping Stones - A Child Money Back Plan, Amsure Bonus Builder,

Amsure Future Builder, Amsure Business Builder, Amsure Future Builder, Max

Mangal Endowment plan and Max Vriksha Money Back.

Tailoring a policy to best-suit individual requirements, even before a policy is sold, a

Personal Insurance Plan gives complete details of a policy with a year-on-year

summary of the

premiums to be paid, as well as the likely benefits that may accrue. Also all policies

come with a 'policy review period' offer that allows unconditional return of the policy

within 15 days from date of receipt.

The 9 Options & Riders are - Option to Participate in Progressive Bonus, Guaranteed

Insurability Option, Waiver of Premiums, Spouse Insurance, Personal Accident

Benefit, Dread Disease, Payor Benefit, Term Rider, 5 Year Term Renewable &

Convertible Rider

MISSION

Become one of the top 3 new life insurance companies

Become a national playerdominant in north India

Be the brand of first choice among all stake holders

Become the employer of choice.

Be the principal of choice for agents.

Max New York Life is a young vibrant company proud of the excellent track record it has

created for itself in a relatively short period of time. MNYL has today become one of the

most aggressive players in the Insurance services domain. A key factor in our success has

been our ability to attract some of the most talented people in any industry.

MNYL in many ways is a lens to India. We represent rich diversity in our workforce and this

is reflected in our open work environment. Within this diversity we have successfully created


15/116


16/116

16

stakeholders. MNYL recognizes the need for appreciation for demonstrating our core values

thru behaviors. We provide a platform in the form of Cultural Ambassador to recognize

employees demonstrating our values of Caring, Honesty, Excellence, Knowledge, Integrity,and Teamwork.

Possibly then the best way to explain the MNYL culture would be to share our MNYL Values

and Beliefs.


17/116

17

MAX NEW YORK LIFE VALUES AND BELIEFS

KNOWLEDGE

Knowledge constitutes expertise and our expertise is in helping people protect

themselves. Perfectly combining global expertise with local knowledge, we are the

Indian life insurance specialists. Max New York Life believes that for knowledge to

be of value it must be focused, current, tested and shared.

CARING

Max New York Life is redefining the life insurance paradigm to focus on the needs of

customers. The service process is responsive, personalized, humane and

empathetic. Every individual who represents the company is for us our

brand champion

HONESTY

Max New York Life is redefining the life insurance paradigm to focus on the needs of

customers. The service process is responsive, personalized, humane and empathetic.

Every individual who represents the company is for us our brand champion.

EXCELLENCE

Excellence at Max New York Life implies the ability to perform at a consistently

high level. Focused on the value of continuous improvement in people, processes and


18/116

18

the organization, the company strives for the highest standards of quality in every

aspect of its business.

MAX NEW YORK LIFE- GROWING PRESENCE:

No. of cities 37

No. of Offices 57

No. of Agents 13000 +

No. of Policies 8, 00,000 +

Sum assured 23,500 cr. +


19/116

19

Fig. 5

ACHIEVEMENTS

MNYL is the first life insurance company in India to be awarded the ISO 9001: 2000

certification.

MNYL was among the top 25 companies to work with in India, according to 2003

Business World Magazine, Great Workplaces In India, MNYL was ranked at the

20th

position. This survey is the local version of the Great Places to Work survey carried

out every year in 22 countries.


20/116

20

We were among top five most respected private life insurance companies in India

according to 2004' Business World Most Respected survey. It makes it more special

as that year insurance as a category was included for the first time.

MDRT (MILLION DOLLAR ROUND TABLE)

The MDRT was founded by a group of dedicated agent leaders. In a sense, it may be said that

the field force of the business, despairing of company managements sales centric approaches

in agent education and training, turned to self-organised efforts in promoting self-education

philosophy and concepts. Thinking field men foresaw misfortune to the industry itself if the

faults of the agency system were continued. They also recognised that their plans must

permeate the whole industry to become effective and it would be necessary, therefore, toenlist the help of home offices.

MDRT is a world wide organization of the top producers of life insurance sales. 74 nations

and territories participate in it. New York Life is the no.1 in MDRT membership 50 years in a

row.

Max New York Life leads the MDRT among Indian private insurers. Max New York Life is

in top 100 MDRT global list ranked at the 49th position. 201 Max New York Life agent

advisors have qualified 2006 MDRT for the meeting to be held in San Diego.


21/116

21

RATIONALE OF THE STUDY

Performance Appraisal is the important aspect in the organization to evaluate the

employees performance. It helps in understanding the employees work culture,

involvement, and satisfaction. It helps the organization in deciding employees

promotion, transfer, incentives, pay increase.


22/116

22

OBJECTIVES OF THE STUDY

This project is aim at studying the system of performance appraisal. Performance

appraisal is the most significant and indispensable tool for the management as it

provides useful information for decision making in the area of promotions and

compensation reviews.

To carry out the study of Max Life Insurance, we framed the following objectives

1. Identification of the technique of performance appraisal followed in Max Life

Insurance.

2. Employee attitude towards the present appraisal system.

3. To identify and know the area for improvement system.

4. Review of the current appraisal system in order to:-

Enhance productivity

Attain global standards

5. To provide suggestions & recommendations from the study conducted.


23/116

23

PERFORMANCE APPRAISAL SYSTEM

INTRODUCTION TO THE TOPIC

Human Resource (or personnel) management, in the sense of getting things done

through people, is an essential part of every managers responsibility, but many

organizations find it advantageous to establish a specialist division to provide an

expert service dedicated to ensuring that the human resource function is performed

efficiently.

People are our most valuable asset is a clich, which no member of any senior

management team would disagree with. Yet, the realities for many organizations are

that their people remain undervalued, under trained and underutilized.

Performance Appraisal is the process of assessing the performance and progress of an

employee or a group of employees on a given job and his / their potential for future

development. It consists of all formal procedures used in the working organizations to

evaluate personalities, contributions and potentials of employees.


24/116

24

FUNCTIONS OF HUMAN RESOURCE MANAGEMENT

Following are the various functions of Human Resource Management that are

essential for the effective functioning of the organization:

1. Recruitment

2. Selection

3. Induction

4. Performance Appraisal

5. Training & Development

Recruitment

The process of recruitment begins after manpower requirements are determined in

terms of quality through job analysis and quantity through forecasting and planning.

Selection


25/116

25

The selection is the process of ascertaining whether or not candidates possess the

requisite qualifications, training and experience required.

Induction

a) Induction is the technique by which a new employee is rehabilitated into the

changed surroundings and introduced to the practices, policies and purposes of

the organization.

Performance Appraisal

Performance evaluation should be a continuing process throughout the year,

with a formal performance evaluation interview conducted annually. The

intent is to communicate expectations, provide constructive feedback,

document accomplishments, compare current performance against

expectations and jointly formulate performance development plans.

Training and development

Training and development -- or "learning and development" as many refer to it

now -- is one of the most important aspects of our lives and our work. (Many

people view "training" as an activity that produces the result or outcome of

"learning" -- and learning is typically viewed as new knowledge, skills and

competencies or abilities.) In our culture, we highly value learning. Yet,

despite our having attended many years of schooling, many of us have no idea

how to carefully design an approach to training and development.


26/116

26


27/116

27

WHAT IS PERFORMANCEAPPRAISAL?

Performance Appraisal is defined as the process of assessing the performance and

progress of an employee or a group of employees on a given job and his / their

potential for future development. It consists of all formal procedures used in working

organizations and potential of employees. According to Flippo, Performance

Appraisal is the systematic, periodic and an important rating of an employees

excellence in matters pertaining to his present job and his potential for a better job.

CHARACTERISTICS

1. Performance Appraisal is a process.

2. It is the systematic examination of the strengths and weakness of an

employee in terms of his job.

3. It is scientific and objective study. Formal procedures are used in the study.

4. It is an ongoing and continuous process wherein the evaluations are arranged

periodically according to a definite plan.

5. The main purpose of Performance Appraisal is to secure information

necessary for making objective and correct decision an employee.

PROCESS

The process of performance appraisal:

1. Establishing performance standards

2. Communicating the Standards

3. Measuring Performance


28/116


29/116

29

METHODS OF PERFORMANCE APPRAISAL

The foregoing list of major program pitfalls represents a formidable challenge, even

considering the available battery of appraisal techniques. But attempting to avoid

these pitfalls by doing away with appraisals themselves is like trying to solve the

problems of life by committing suicide. The more logical task is to identify those

appraisal practices that are (a) most likely to achieve a particular objective and (b)

least vulnerable to the obstacles already discussed.

Before relating the specific techniques to the goals of performance appraisal stated at

the outset of the article, I shall briefly review each, taking them more or less in an

order of increasing complexity.

The best-known techniques will be treated most briefly.

ESSAY APPRAISAL

In its simplest form, this technique asks the rater to write a paragraph or more

covering an individual's strengths, weaknesses, potential, and so on. In most selection

situations, particularly those involving professional, sales, or managerial positions,

essay appraisals from former employers, teachers, or associates carry significant

weight.

GRAPHIC RATING SCALE

This technique may not yield the depth of an essay appraisal, but it is more consistent

and reliable. Typically, a graphic scale assesses a person on the quality and quantity

of his work (is he outstanding, above average, average, or unsatisfactory?) and on a


30/116

30

variety of other factors that vary with the job but usually include personal traits like

reliability and cooperation. It may also include specific performance items like oral

and written communication.

FIELD REVIEW

The field review is one of several techniques for doing this. A member of the

personnel or central administrative staff meets with small groups of raters from each

supervisory unit and goes over each employee's rating with them to (a) identify areas

of inter-rater disagreement, (b) help the group arrive at a consensus, and (c) determine

that each rater conceives the standards similarly.

FORCED-CHOICE RATING

Like the field review, this technique was developed to reduce bias and establish

objective standards of comparison between individuals, but it does not involve the

intervention of a third party.

MANAGEMENT BY OBJECTIVES

To avoid, or to deal with, the feeling that they are being judged by unfairly high

standards, employees in some organizations are being asked to set - or help set - their

own performance goals. Within the past five or six years, MBO has become

something of a fad and is so familiar to most managers that I will not dwell on it here.

RANKING METHODS

For comparative purposes, particularly when it is necessary to compare people who

work for different supervisors, individual statements, ratings, or appraisal forms are

not particularly useful. Instead, it is necessary to recognize that comparisons involve


31/116

31

an overall subjective judgment to which a host of additional facts and impressions

must somehow be added. There is no single form or way to do this.

The best approach appears to be a ranking technique involving pooled judgment.

The two most effective methods are alternation ranking and paired comparison

ranking.

1. Alternation ranking:

Ranking of employees from best to worst on a trait or traits is another method for

evaluating employees. Since it is usually easier to distinguish between the worst and

the best employees than to rank them, an alternation ranking method is most popular.

Here subordinates to be rated are listed and the names of those not well enough to

rank are crossed. Then on a form as shown below, the employee who is highest on the

characteristic being measured and the one who is the lowest are indicated. Then

choose the next highest and the next lowest, alternating between highest and lowest

until all the employees to be rated have been ranked.

2. Paired-comparison ranking:

This technique is probably just as accurate as alternation ranking and might be more

so. But with large numbers of employees it becomes extremely time consuming and

cumbersome.

Both ranking techniques, particularly when combined with multiple rankings (i.e.,

when two or more people are asked to make independent rankings of the same work

group and their lists are averaged), are among the best available for generating valid

order-of-merit rankings for salary administration purposes.


32/116


33/116

33

Advantages

Instead of assuming traits, the MBO method concentrates on actual outcomes. If the

employee meets or exceeds the set objectives, then he or she has demonstrated an

acceptable level of job performance. Employees are judged according to real

outcomes, and not on their potential for success, or on someone's subjective opinion

of their abilities.

The guiding principle of the MBO approach is that direct results can be observed

easily. The MBO method recognizes the fact that it is difficult to neatly dissect all the

complex and varied elements that go to make up employee performance.

MBO advocates claim that the performance of employees cannot be broken up into so

many constituent parts, but to put all the parts together and the performance may be

directly observed and measured.

Disadvantages

This approach can lead to unrealistic expectations about what can and cannot be

reasonably accomplished. Supervisors and subordinates must have very good "reality

checking" skills to use MBO appraisal methods. They will need these skills during the

initial stage of objective setting, and for the purposes of self-auditing and self-

monitoring.

Variable objectives may cause employee confusion. It is also possible that fluid

objectives may be distorted to disguise or justify failures in performance.


34/116

34

Benefits of Performance Appraisals

Measures an employees performance.

Helps in clarifying, defining, redefining priorities and objectives.

Motivates the employee through achievement and feedback.

Facilitates assessment and agreement of training needs.

Helps in identification of personal strengths and weaknesses.

Plays an important role in Personal career and succession planning.

Clarifies team roles and facilitates team building.

Plays major role in organizational training needs assessment and analysis.

Improves understanding and relationship between the employee and the

reporting manager and also helps in resolving confusions and

misunderstandings.

Plays an important tool for communicating the organizations philosophies,

values, aims, strategies, priorities, etc among its employees.

Helps in counseling and feedback.

Rating Errors in Performance Appraisals

Performance appraisals are subject to a wide variety of inaccuracies and biases

referred to as 'rating errors'. These errors can seriously affect assessment results.

Some of the most common rating errors are: -


35/116

35

1. Leniency or severity: - Leniency or severity on the part of the rater makes the

assessment subjective. Subjective assessment defeats the very purpose of

performance appraisal. Ratings are lenient for the following reasons:

a) The rater may feel that anyone under his or her jurisdiction who is

rated unfavorably will reflect poorly on his or her own worthiness.

b) He/She may feel that a derogatory rating will be revealed to the rate to

detriment the relations between the rater and the ratee.

c) He/She may rate leniently in order to win promotions for the

subordinates and therefore, indirectly increase his/her hold over him.

2. Central tendency: - This occurs when employees are incorrectly rated near the

average or middle of the scale. The attitude of the rater is to play safe. This safe

playing attitude stems from certain doubts and anxieties, which the raters have

been assessing the rates.

3. Halo error: - A halo error takes place when one aspect of an individual's

performance influences the evaluation of the entire performance of the

individual. The halo error occurs when an employee who works late constantly

might be rated high on productivity and quality of output as well as on

motivation. Similarly, an attractive or popular personality might be given a

high overall rating. Rating employees separately on each of the performance

measures and encouraging raters to guard against the halo effect are the two

ways to reduce the halo effect.


36/116

36

4. Rater effect:-This includes favoritism, stereotyping, and hostility. Extensively

high or low score are given only to certain individuals or groups based on the

rater's attitude towards them and not on actual outcomes or behaviors; sex, age,

race and friendship biases are examples of this type of error.

5. Primacy and Regency effects:- The rater's rating is heavily influenced either

by behaviour exhibited by the ratee during his early stage of the review period

(primacy) or by the outcomes, or behavior exhibited by the ratee near the end

of the review period (regency). For example, if a salesperson captures an

important contract/sale just before the completion of the appraisal, the timing

of the incident may inflate his or her standing, even though the overall

performance of the sales person may not have been encouraging. One way of

guarding against such an error is to ask the rater to consider the composite

performance of the rate and not to be influenced by one incident or an

achievement.

6. Performance dimension order: - Two or more dimensions on a performance

instrument follow each other and both describe or rotate to a similar quality.

The rater rates the first dimensions accurately and then rates the second

dimension to the first because of the proximity. If the dimensions had been

arranged in a significantly different order, the ratings might have been

different.

7. Spillover effect:- This refers to allowing past performance appraisal rating to

unjustifiably influence current ratings. Past ratings, good or bad, result in


37/116

37

similar rating for current period although the demonstrated behaviour does not

deserve the rating, good or bad.

ROLES IN THE PERFORMANCE APPRAISAL PROCESS

a) Reporting Manager

Provide feedback to the reviewer / HOD on the employees behavioral traits

indicated in the PMS Policy Manual

Ensures that employee is aware of the normalization / performance appraisal

process

Address employee concerns / queries on performance rating, in consultation

with the reviewer.

b) Reviewer (Reporting Managers Reporting Manager)

Discuss with the reporting managers on the behavioral traits of all the

employees for whom he / she is the reviewer

Where required, independently assess employees for the said behavioral traits;

such assessments might require collecting data directly from other relevant

employees.

c) HOD (In some cases, a reviewer may not be a HOD)

Presents the proposed Performance Rating for every employee of his /her

function to the Normalization committee.

HOD also plays the role of a normalization committee member


38/116

38

Owns the performance rating of every employee in the department.

d) HR Head

Secretary to the normalization committee

Assists HODs / Reporting Managers in communicating the performance rating of all

the employees.

e) Normalization Committee

Decides on the final bell curve for each function in the respective Business Unit

Reviews the performance ratings proposed by the HODs, specifically on the upward /

downward shift in ratings, to ensure an unbiased relative ranking of employees on

overall performance, and thus finalize the performance rating of each employee

KEY CONCEPTS IN PMS

In order to understand the Performance Management System at MAX LIFE

INSURANCE, some concepts need to be explained which play a very important role

in using the PMS successfully.

They are:

KRAS (KEY RESULT AREAS):

The performance of an employee is largely dependent on the KRA score achieved by

the employee during that particular year. Thus, it is necessary to answer a few basic

questions i.e.

What are the guidelines for setting the KRAs for an employee?


39/116


40/116

40

the HR department pays due attention to these guidelines while preparing the

bell curves for various functions and the consolidated bell curve for all the

functions. These guidelines also help in deciding upon the promotion cases in

a year.

PERFORMANCE RATING PROCESS

EXCEPTIONAL CONTRIBUTOR (EC)

Performs consistently and

substantially above expectations in

all areas

Achieves a final score greater than

or equal to 115%

Consistently delivers on stretch

targets

Is proactive

Spots and anticipates problems,

implements solutions

Sees and exploits opportunities

Delivers ahead of time

SIGNIFICANT CONTRIBUTOR (SC)

Performs above expectations

in all areas

Achieves final score between

100-114%

Versatile in his/ her area of

operation

Develops creative solutions and

require little / minimal

supervision

Sets examples for others

Take ownership of own

development

Coaches others


41/116

41

Sees the wider picture-impacts

across business

Focuses on whats good for the

business

Seen as role model by others

Recognized as exceptional by other

functions as well

Motivates others to solve problems

Develops others

Provides open and honest

feedback.

Able to establish and lead cross-

functional teams

Demonstrates business initiative

Is self motivated

Supportive team player

Leads own team very effectively

Demonstrate functional initiative


42/116

42

PROJECT REPORT ON "PERFORMANCE APPRAISAL"

LITERATURE REVIEW AND CONCEPT FORMULATION

Human Resource (or personnel) management, in the sense of getting things done

through people, is an essential part of every managers responsibility, but many

organizations find it advantageous to establish a specialist division to provide an

expert service dedicated to ensuring that the human resource function is performed

efficiently.

People are our most valuable asset is a clich, which no member of any senior

management team would disagree with. Yet, the reality for many organizations are

that their people remain under valued, under trained and under utilized.

Following are the various functions of Human Resource Management that are

essential for the effective functioning of the organization:

1. Recruitment

2. Selection

3. Induction

4. Performance Appraisal

5. Training & Development


43/116

43

PROCESS OF PERFORMANCE APPRAISAL

STEPS OF PERFORMANCE APPRAISAL


44/116


45/116

45

ESTABLISHING PERFORMANCE STANDARDS

The first step in the process of performance appraisal is the setting up of the standards

which will be used to as the base to compare the actual performance of the employees.

This step requires setting the criteria to judge the performance of the employees as

successful or unsuccessful and the degrees of their contribution to the organizational

goals and objectives. The standards set should be clear, easily understandable and in

measurable terms. In case the performance of the employee cannot be measured, great

care should be taken to describe the standards.

COMMUNICATING THE STANDARDS

Once set, it is the responsibility of the management to communicate the standards to

all the employees of the organization.

The employees should be informed and the standards should be clearly explained to

the. This will help them to understand their roles and to know what exactly is

expected from them. The standards should also be communicated to the appraisers or

the evaluators and if required, the standards can also be modified at this stage itself

according to the relevant feedback from the employees or the evaluators.

MEASURING THE ACTUAL PERFORMANCE

The most difficult part of the performance appraisal process is measuring the actual

performance of the employees that is the work done by the employees during the

specified period of time. It is a continuous process which involves monitoring the

performance throughout the year. This stage requires the careful selection of the


46/116

46

appropriate techniques of measurement, taking care that personal bias does not affect

the outcome of the process and providing assistance rather than interfering in an

employees work.

COMPARING THE ACTUAL WITH THE DESIRED PERFORMANCE

The actual performance is compared with the desired or the standard performance.

The comparison tells the deviations in the performance of the employees from the

standards set. The result can show the actual performance being more than the desired

performance or, the actual performance being less than the desired performance

depicting a negative deviation in the organizational performance. It includes recalling,

evaluating and analysis of data related to the employeesperformance.

DISCUSSING RESULTS

The result of the appraisal is communicated and discussed with the employees on one-

to-one basis. The focus of this discussion is on communication and listening. The

results, the problems and the possible solutions are discussed with the aim of problem

solving and reaching consensus. The feedback should be given with a positive attitude

as this can have an effect on the employees future performance. The purpose of the

meeting should be to solve the problems faced and motivate the employees to perform

better.

DECISION MAKING

The last step of the process is to take decisions which can be taken either to improve

the performance of the employees, take the required corrective actions, or the related


47/116


48/116

48

Challenges of Performance Appraisal

In order to make a performance appraisal system effective and successful, an

organization comes across various challenges and problems. The main challenges

involved in the performance appraisal process are:

Determining the evaluation criteria

Identification of the appraisal criteria is one of the biggest problems faced by

the top management. The performance data to be considered for evaluation

should be carefully selected. For the purpose of evaluation, the criteria

selected should be in quantifiable or measurable terms.

Create a rating instrument

The purpose of the performance appraisalprocess is to judge the performance

of the employees rather than the employee. The focus of the system should be

on the development of the employees of the organization.

Lack of competence

Top management should choose the raters or the evaluators carefully. They

should have the required expertise and the knowledge to decide the criteria

accurately. They should have the experience and the necessary training to

carry out the appraisal process objectively.

Errors in rating and evaluation

Many errors based on the personal bias like stereotyping, halo effect (i.e. one

trait influencing the evaluators rating for all other traits) etc. may creep in the


49/116


50/116


51/116


52/116


53/116

53

information. Permitting employees to review the results of their appraisal allows them

to detect any errors that may have been made. If they disagree with the evaluation,

they can even challenge the same through formal channels.

It follows then that formal procedures should be developed to enable employees who

disagree with appraisal results which are considered to be inaccurate or unfair. They

must have the means for pursuing their grievances and having them addressed

objectively. When management uses it as a whip or fails to understand its limitations,

it fails. The key is not which forms or which method is used. Performance appraisal

should be used primarily to develop employees as valuable resources. Only then it

would show promising results.

ELECTRONIC PERFORMANCE MONITORING

Electronic performance monitoring refers to the use of technology to monitor

the employees performance.

Organizations across the world are incorporating the use of various advanced

technologies for all functions at all levels. Many organizations have incorporated

technologies in the performance appraisal and management processes. The electronic

and computerized systems are being used to monitor and evaluate the performance of

the employees.

The concept of electronic performance management has been the latest trend in

performance surveillance in the foreign countries where almost every job has the

potentials of being monitored electronically. But with the increasing number of

MNCs, the trend is catching up fast in India.


54/116

54

With the organizations using the latest technologies and soft wares, electronic

performance monitoring supports comprehensive, qualitative, and subjective

assessment of the individuals performance.

The main reasons for practicing electronic performance monitoring are

It improves productivity and the quality of work

Subjective work evaluation

Compliance with the organizational policies and the local laws

Helps in cost-control in the company

Helps in the security of the company information.

Despite all its advantages, the arguments given against the use of electronic

performance monitoring is that such systems interfere in the privacy of the employees

and some employees may take it against their dignity.

Using such system can have both positive and negative effects on the organizational

health. It is argued that, to ensure the positive effects of electronic performance

monitoring:

The employees should be explained and communicated clearly about the system:

The employees suggestions should be taken in designing the system

The employees should be involved in the implementation of the system

The organization should not solely rely on the system for the data on

employees performance.


55/116

55

The system should be supported by effective two-way communication and

feedback.


56/116

56


57/116


58/116

58

PERFORMANCE APPRAISAL METHODS

Tools of Performance appraisal methods include 11 methods / types which are as

follows:

1.CRITICAL INCIDENT METHOD

The critical incidents for performance appraisal is a method in which the manager

writes down positive and negative performance behavior of employees throughout the

performance period

2.WEIGHTED CHECKLIST

This method describe a performance appraisal method where rater familiar with the

jobs being evaluated prepared a large list of descriptive statements about effective and

ineffective behavior on jobs

3.PAIRED COMPARISON ANALYSIS

Paired comparison analysis is a good way of weighing up the relative importance of

options. A range of plausible options is listed. Each option is compared against each

of the other options. The results are tallied and the option with the highest score is the

preferred option.

4.GRAPHIC RATING SCALES

The Rating Scale is a form on which the manager simply checks off the employees
http://www.humanresources.hrvinet.com/performance-appraisal-methods/http://www.humanresources.hrvinet.com/performance-appraisal-methods/http://www.humanresources.hrvinet.com/critical-incident-method-of-performance-appraisal/http://www.humanresources.hrvinet.com/critical-incident-method-of-performance-appraisal/http://www.humanresources.hrvinet.com/critical-incident-method-of-performance-appraisal/http://www.humanresources.hrvinet.com/weighted-checklist/http://www.humanresources.hrvinet.com/weighted-checklist/http://www.humanresources.hrvinet.com/weighted-checklist/http://www.humanresources.hrvinet.com/paired-comparison-analysis/http://www.humanresources.hrvinet.com/paired-comparison-analysis/http://www.humanresources.hrvinet.com/graphic-rating-scales/http://www.humanresources.hrvinet.com/graphic-rating-scales/http://www.humanresources.hrvinet.com/graphic-rating-scales/http://www.humanresources.hrvinet.com/graphic-rating-scales/http://www.humanresources.hrvinet.com/paired-comparison-analysis/http://www.humanresources.hrvinet.com/weighted-checklist/http://www.humanresources.hrvinet.com/critical-incident-method-of-performance-appraisal/http://www.humanresources.hrvinet.com/performance-appraisal-methods/


59/116


60/116


61/116

61

3. Employee performance appraisal form

This form is a performance appraisal sample used for staff position.

4. Essay evaluation form

This form is based on essay evaluation method of performance appraisal.

5.Forced Choice formThis form is a performance appraisal sample based on forced choice method of

performance appraisal.

6. Weighted checklist form

This form is based on weighted checklist method of performance appraisal.

7.Rating scale formThis form is a performance appraisal sample based on rating scales method of

performance appraisal.

8. Employee self appraisal form

This form is a performance appraisal sample based on appraisal self by employee.
http://www.humanresources.hrvinet.com/employee-performance-appraisal-form/http://www.humanresources.hrvinet.com/essay-evaluation-form/http://www.humanresources.hrvinet.com/forced-choice-form/http://www.humanresources.hrvinet.com/forced-choice-form/http://www.humanresources.hrvinet.com/forced-choice-form/http://www.humanresources.hrvinet.com/weighted-checklist-form/http://www.humanresources.hrvinet.com/rating-scale-form/http://www.humanresources.hrvinet.com/rating-scale-form/http://www.humanresources.hrvinet.com/rating-scale-form/http://www.humanresources.hrvinet.com/employee-self-appraisal-form/http://www.humanresources.hrvinet.com/employee-self-appraisal-form/http://www.humanresources.hrvinet.com/rating-scale-form/http://www.humanresources.hrvinet.com/weighted-checklist-form/http://www.humanresources.hrvinet.com/forced-choice-form/http://www.humanresources.hrvinet.com/essay-evaluation-form/http://www.humanresources.hrvinet.com/employee-performance-appraisal-form/


62/116


63/116

63

3. Teamwork:

Establish and maintain effective working relationship with others.

Shares information and resources with others

Follows instructions of supervisor and respond to requests from others in the

team in a helpful manner.

Contributing work and effort to group performance to meet agreed upon

objectives and achieve team success

4. Job knowledge

Application of appropriate level of technical and procedural knowledge in

specific field

Degree of technical competence.

Understanding of job procedures, methods, facts and information related to

assignments.

Perform duties with minimal supervision but seek guidance where and when

appropriate to the job, consults the appropriate staff

5. Initiative

Consider the extent to which the employees sets own constructive work

practice and recommends and creates own procedures.

Self-starter, develop and implement new methods, procedures, solutions,

concepts, designs and/or applications of existing designs or procedures.


64/116


65/116


66/116

66

12. Dependability

Performance appraisal of dependability includes elements as:

Consider the extent to which the employee completes assignments on time and

carries out instructions.

Starts work at appropriate time;

Respects time allowed for breaks and lunch;

Follows policies for requesting and reporting time off;

Helps ensure work duties are covered when absent;

Employees presence can be relied upon for planning purposes.

Attendance and punctuality meets supervisors requirements.

2. MANAGER PERFORMANCE APPRAISAL FORM

I / MANAGER INFORMATION:

o Name

o Date

o Job Title

o Date of Last Review

o Department:

o Appraiser Name

II/ PERFORMANCE ACHIEVEMENT

You should design table with columns as No, agreed objectives, weight, result,

total score.


67/116

67

This table is used for objective performance.

III/ COMPETENCIES

1. Identify competencies needed for job, for example:

Technical skills

financial skills

Decision making ability

Analytical ability / problem solving

Initiative/perseverance/enthusiasm

Flexibility

Written communication skills

Oral communication skills

Customer focus

Teamwork

Organizational ability.

Negotiating skills

2. Rating scales can be:

1 = Exceptional

2Strong

3 = Fully Competent

4 = Continued Development

5 = Poor


68/116


69/116


70/116


71/116

71

Financial skills

Decision making ability

Analytical ability / problem solving

Initiative/perseverance/enthusiasm

Flexibility

2. Rating scales can be:

1 = Exceptional

2Strong

3 = Fully Competent

4 = Continued Development

5 = Poor

N = Not Apply

IV/ DISCUSSIONS

1. Strengths (examples of where individual has excelled).

2. Developmental needs (areas that need strengthening, additional

experience/exposure).

V/ OVERALL RATING

1. Rating scales Exceptional

Strong


72/116

72

Fully Competent

Continued Development

Poor to Position

2) Definition of each element: Exceptional (clearly outstanding performance). Performance falls within

top 510 % of employees at his/her level.

Strong (excellent performance). Performance falls within top 15% of the

employees at his/her level.

Fully Competent (solid performance). Consistently meets expectations.

Two-thirds of your employees should fall within this category.

Continued Development. Needs development in current position. Overall

performance is somewhat lower than expected for the current position.

Poor (unsatisfactory performance). Performance is clearly below what is

expected at current position/level.

New to Position. Employee has been in position for less than six (6) months.

VI/ EMPLOYEE COMMENTS


73/116


74/116

74

4. ESSAY EVALUATION FORM

1. Definition of essay evaluation This method asked managers / supervisors to describe strengths and

weaknesses of an employees behavior. Essay evaluation is a non-quantitative

technique.

This method usually use with the graphic rating scale method.

2. Input of information sources Job knowledge and potential of the employee;

Employees understanding of the companys programs, policies, objectives,

etc.;

The employees relations with co-workers and superiors;

The employees general planning, organizing and controlling ability;

The attitudes and perceptions of the employee, in general.

3. Disadvantages of essay evaluation Manager / supervisor may write a biased essay.

Some evaluators may be poor in writing essays on employee performance.

Others may be superficial in explanation and use flowery language which may

not reflect the actual performance of the employee.


75/116


76/116

76

6. Jobholders comments

5. FORCED CHOICE FORM

1. Design question Forced ChoiceRequirements of questions: both statements in the pair may be positive or negative.

Quality of work: ____quality is good____

Absent too often: ____works hard____

Learns quickly: ____work is reliable____

Performance is exemplary: ____usually tardy____

2. Deployment of Forced Choice form This form is conducted by line manager.

The rater is required to choose the most descriptive statement in each pair

of statements.

FORCED RANKING (FORCED DISTRIBUTION)

1. Definition of forced ranking (forced distribution)Forced ranking is a method of performance appraisal to rank employee but in order of

forced distribution.
http://www.humanresources.hrvinet.com/forced-ranking-forced-distribution/http://www.humanresources.hrvinet.com/forced-ranking-forced-distribution/


77/116

77

For example, the distribution requested with 10 or 20 percent in the top category, 70

or 80 percent in the middle, and 10 percent in the bottom.

The top-ranked employees are considered high-potential employees and are often

targeted for a more rapid career and leadership development programs.

In contrast, those ranked at the bottom are denied bonuses and pay increases. They

may be given a probationary period to improve their performance.

2. Application of Forced RankingGE, Ford Motor, Conoco, Sun Microsystems, Cisco Systems, EDS, Enron and a host

of other U.S. corporations have adopted similar policies of this method

Advantages and disadvantages of forced Ranking

Advantages: They create and sustain a high performance culture in which the workforce

continuously improves.

They force reluctant managers to make difficult decisions and identify the

most and least talented members of the work group.

Disadvantages They increase unhealthy cut-throat competitiveness;

They discourage collaboration and teamwork;

They harm morale;

They are legally suspect giving rise to age discrimination cases.


78/116


79/116

79

4. Advantages and disadvantages of weighted checklist This method helps the manager in evaluation of the performance of the

employee.

The rater may be biased in distinguishing the positive and negative questions.

He may assign biased weights to the questions.

This method also is expensive and time consuming.

It becomes difficult for the manager to assemble, analyze and weigh a number

of statements about the employees characteristics, contributions and

behaviors.

WEIGHTED CHECKLIST FORM

1. Identify question:Based on elements of job performance, you can design questions as follows (for

example)

Employee cooperatively assists coworkers who need help

Employee plans actions before beginning work

Employee works overtime when asked to

Employee keeps work station well organized

Employee listens to advice but seldom follows it


80/116


81/116

81

Judgment

Attitude. Exhibits enthusiasm and cooperativeness on the job

Cooperation. Willingness and ability to work with others to produce desired

goals.

Initiative.

3. Rating scalesRating scales can include 5 elements as follows:

Unsatisfactory

Fair

Satisfactory

Good

Outstanding

4. Advantages of the rating scales

Graphic rating scales are less time consuming to develop.

They also allow for quantitative comparison.

5. Disadvantages of the rating scales

More validity comparing workers ratings from a single supervisor than

comparing two workers who were rated by different supervisors.

Different supervisors will use the same graphic scales in slightly different

ways.


82/116


83/116

83

Fair 2 points

Poor1 point

8. SELF APPRAISAL FORM

EMPLOYEE SELF APPRAISAL FORM

Review period: from ___to___

Name:

Department:

Position:

Job code:

Based on your job description and current work assignments, please answer questions

as follows:

1. Please list your most significant accomplishments or contributions during this

appraisal period.

2. Describe any factors, positive or negative, you feel may have helped or hindered in

meeting your formal or informal goals or objectives.

3. Have you successfully performed any new tasks or additional duties outside the

scope of your regular responsibilities? If so, please specify.

4. What skills do you have that you feel could be used more effectively?

5. Describe the areas you feel require improvement in terms of your professional

development. List the steps you plan to take and/or the resources you need to

accomplish this.
http://www.humanresources.hrvinet.com/employee-self-appraisal-form/http://www.humanresources.hrvinet.com/employee-self-appraisal-form/


84/116

84

6. In your opinion, how does the work you perform align with or support the

objectives of the University Mission Statement?

7. List 2-4 of your career goals for the coming year and indicate how you plan to

accomplish them.

8. Please evaluate yourself on the following factors: outstanding, very competent,

satisfactory, needs improvement

Interpersonal Skills

Time Management Skills

Teamwork

Innovation/Creativity

Please use this space to provide any additional comments.

Please attach additional sheets if necessary.

Employee Signature:

Date:

SELF EVALUATION FORM

Employee name:

Department:

Position:

Date:

Period of appraisal:


85/116

85

1. What are your main job responsibilities?

2. Which job responsibilities do you view as most important? Why?

3. Have any new responsibilities been added or removed from your job this year? If

so, what?

4. Have there been any special circumstances that have helped or hindered you in

doing your job this year? If yes, how did they affect your work, and what were the

circumstances?

5. List your most significant accomplishments or contributions during the past year.

How do these achievements align with the goals/objectives outlined in your last

review?

6. Since the last review period, have you performed any new tasks or additional duties

outside the scope of your regular responsibilities? If so, please specify.

7. To which of the following factors would you attribute your professional

development since last year: offsite seminars/classes, onsite training, peer training,

on-the-job experience, better exposure to challenging projects, other. Please describe.

8. What would help you to do your job better and provide greater job satisfaction?

9. What are your goals for next year and what action will you take to accomplish

these goals?

10. What could your supervisor/manager do to support you in doing your job?

11. What additional support from your organization would help you do your job more

effectively?

12. What recommendations do you have that would make this a better place to work?

13. Indicate your career interests, including the type of assignment you would like

next.


86/116


87/116

87

1. DEFINITION OF SELF APPRAISALSelf-appraisal is a method of performance appraisal that is done by employee

(appraise).

ADVANTAGES OF SELF APPRAISAL By having employees do some sort of self evaluation before the actual review

meeting, the review meetings can be shorter.

If done properly and tactfully, encouraging employees to self evaluation or

self appraise at any time during the year, including around the actual review

meetings, help convey the message that the process of performance

management and appraisal is a team effort, and not something the manager

does to the employee.

Whey self appraisal is an accepted and integrated part of the performance

management process, it encourages employees to self evaluate throughout the

year.

Self-ratings are particularly useful if the entire cycle of performance

management involves the employee in a self-assessment.

The developmental focus of self-assessment is a key factor.

Approximately half of the Federal employees in a large survey felt that self-

ratings would contribute to a great or very great extent to fair.

Self-appraisals are particularly valuable in situations where the supervisor

cannot readily observe the work behaviors and task outcomes.


88/116

88

DISADVANTAGES OF SELF APPRAISAL Research shows low correlations between self-ratings and all other sources of

ratings, particularly supervisor ratings. The self-ratings tend to be consistently

higher. This discrepancy can lead to defensiveness and alienation if

supervisors do not use good feedback skills.

Sometimes self-ratings can be lower than others. In such situations,

employees tend to be self-demeaning and may feel intimidated and put on the

spot.

Self-ratings should focus on the appraisal of performance elements, not on the

summary level determination. A range of rating sources, including the self

assessments, help to round out the information for the summary rating.


89/116

89

RATING ERRORS IN PERFORMANCE APPRAISALS

Performance appraisals are subject to a wide variety of inaccuracies and biases

referred to as 'rating errors'. These errors can seriously affect assessment results.

Some of the most common rating errors are: -

1. Leniency or severity: - Leniency or severity on the part of the rater makes the

assessment subjective. Subjective assessment defeats the very purpose of performance

appraisal. Ratings are lenient for the following reasons:

a) The rater may feel that anyone under his or her jurisdiction who is

rated unfavorably will reflect poorly on his or her own worthiness.

b) He/She may feel that a derogatory rating will be revealed to the rate to

detriment the relations between the rater and the ratee.

c) He/She may rate leniently in order to win promotions for the

subordinates and therefore, indirectly increase his/her hold over him.

2. Central tendency: - This occurs when employees are incorrectly rated near the

average or middle of the scale. The attitude of the rater is to play safe. This safe

playing attitude stems from certain doubts and anxieties, which the raters have been

assessing the rates.

3. Halo error: - A halo error takes place when one aspect of an individual's

performance influences the evaluation of the entire performance of the individual. The

halo error occurs when an employee who works late constantly might be rated high on

productivity and quality of output as well ax on motivation. Similarly, an attractive or


90/116

90

popular personality might be given a high overall rating. Rating employees separately

on each of the performance measures and encouraging raters to guard against the halo

effect are the two ways to reduce the halo effect.

4. Rater effect: -This includes favoritism, stereotyping, and hostility. Extensively

high or low score are given only to certain individuals or groups based on the rater's

attitude towards them and not on actual outcomes or behaviors; sex, age, race and

friendship biases are examples of this type of error.

5. Primacy and Regency effects: - The rater's rating is heavily influenced either by

behavior exhibited by the ratee during his early stage of the review period (primacy)

or by the outcomes, or behavior exhibited by the ratee near the end of the review

period (regency). For example, if a salesperson captures an important contract/sale

just before the completion of the appraisal, the timing of the incident may inflate his

or her standing, even though the overall performance of the sales person may not have

been encouraging. One way of guarding against such an error is to ask the rater to

consider the composite performance of the rate and not to be influenced by one

incident or an achievement.

6. Performance dimension order: - Two or more dimensions on a performance

instrument follow each other and both describe or rotate to a similar quality. The rater

rates the first dimensions accurately and then rates the second dimension to the first

because of the proximity. If the dimensions had been arranged in a significantly

different order, the ratings might have been different.

7. Spillover effect: - This refers lo allowing past performance appraisal rating lo

unjustifiably influence current ratings. Past ratings, good or bad, result in similar


91/116

91

rating for current period although the demonstrated behavior docs not deserve the

rating, good or bad.

8. Personal Prejudice: If the rater dislikes any employee or any group, he may rate

them at the lower end, which may distort the rating purpose and affect the career of

these employees.

Other factors that are considered as problems are

Failure of the superiors in conducting performance appraisal and post

performance appraisal interview.

Most part of the appraisal is based on subjectivity.

Less reliability and validity of the performance appraisal techniques.

Negative ratings affect interpersonal relations and industrial relations system.

Influence of external environmental factors and uncontrollable internal factors.

Feedback and post appraisal interview may have a setback on production.

Management emphasizes on punishment rather than development of an

employee in performance appraisal.

Some ratings particularly about the potential appraisal are purely based on

guess work.

The other problems of performance appraisal reported by various studies are:


92/116


93/116

93

The quality and reliability of research study is dependent on the information collected

in a scientific and methodological manner. Scientific planning of designing of

research method is a blue print for any research study. Therefore, proper time and

attention should be given in designing the plan of research. While proper definition of

problem tells the researcher where he has to go, proper design tells him how he should

go. Selection of methodology for a particular project is made easy by sorting out a

number of alternative approaches, each of them having its own advantage and

disadvantages. Efficient design is that which ensure that the relevant data are

collected accurately.

The researcher has to think about what procedure and techniques should be adopted in

the study. He should arrive at the final choice by seeing that the methodology chosen

for project is indeed the best one, when compared with others.

RESEARCH DESIGN:

Research design is the first and foremost step in methodology adopted and

undertaking research study. It is overall plan for the collection and analysis of data in

the research project. Thus it is an organized, systematic approach to be the

formulation, implementation and control of research project.

In fact a well planned and well balanced research design guards against collection of

irrelevant data and achieves the result in the best possible way.

SAMPLE DESIGN:-


94/116

94

The universe of study being large, researcher has to resort to sampling method of data

collection. On the basis of a section of the universe selected in a prescribed manner

one is able to deduce for the universe. For the sample results to be applicable on the

universe, sample should be adequately chosen so to make it representative and

reliable.

SAMPLING PLAN:

Sample Size = 50 Employees

Sample Area = Max Life Insurance

Duration = Two (2) Months.

DATA COLLECTION METHOD:

Data are the bricks with which the researcher has to make a house. While the quality

of research findings depends on data, the adequacy of appropriate data in turn depends

upon proper method of data collection. A number of methods are at the disposal of the

researcher of which one has to select the most appropriate one for visualizing the

research objective. Thus he has to see that the method adopted is compatible with the

resources and research study.

a) Primary Data: Data which are collected fresh and for the first time and thushappens to be original in character. Primary data are gathered for specific

purpose.

b) Secondary Data: Data that collected from primary data i.e., they are alreadyexit some where. For the purpose of our study we collected both the data.


95/116

95

DATA COLLECTION:

Data Sour ces:

(i) Secondary Data through Internet

(ii) Primary Data through Questionnaire

(iii) Contact Method

(iv) Personal Interaction

DATA PRESENTATION AND ANALYSIS:

1. Bar graphs

2. Pie Diagrams


96/116


97/116

97

2. Seniors satisfied by subordinates performance

Table-2

S. No View Percentage

1. Yes 85%

2. No 15%

Interpretation

After analyzing the data, the results shows that 85% of the senior production officers

feel that their seniors are satisfied with their performance and 15% cant say. This

analysis shows there is lack of appraisal by the immediate seniors.

1

85%

2

15%

0% 0%Satisfied with Subordinate performance


98/116

98

3. Satisfied with their own Performance

Table-3


1. Yes 85%

2. No 15%

Interpretation

After analyzing the data, the results shows that 85% of the seniorproduction officers

are satisfied with their own performance and 15% are not satisfied with their own

performance. This implies that satisfaction level has to be increased among senior

production Officers.

1

85%

2

15%

0% 0%

Satisfied with their own performance


99/116

99

4. Performance appraisal improves performance

Table-4


1. Yes 98%

2. No 2%

Interpretation

After analyzing the data, the results shows that98% of the senior production officers

feels that performance appraisal do helps in performing better and rest 2% was not

satisfied with them. Through this we come to know that process of performance

appraisal is coming out to be positive and it should be continued.

0

20

40

60

80

100

12

Improves Performance

Improves Performance


100/116


101/116

101

6. Adequate and fair chance provided to defend against adverse

entries in your appraisal

Table-6


1. Yes 67%

2. No 33%

Interpretation

After analyzing the data, the results show that 67% of the senior production officers

feel that they are provided with a chance to defend them against adverse entries in

their appraisal whereas 33% denies it. This shows that there is lack of chances

provided to defend against adverse entries in appraisal.

Defend against adverse entries


102/116

102

7. Reason for bad performance

Table-7

Personal 16%

Officials 16%

Others 16%

No bad performance 52%

0%

10%

20%

30%

40%

50%

60%

Personal Officials Others No bad

performance

In percentage

In percentage


103/116

103

Interpretation

After analyzing the data, the results shows that 16% of senior production officers

performed bad due to personal reasons, 16% of senior production officers due to

official reasons, 16% of senior production officers due to other reasons and no bad

performance from the rest of the 52% of senior production officers.

This shows that there are some reasons, which are required to be rectified to improve

performance.


104/116

104

8. Awareness about performance appraisal system.

Table-8


1. Yes 67%

2. No 13%

Interpretation

After analyzing the data, the results shows that 67% of the senior production officers

are fully aware of the appraisal system and rest 33% are unaware of this system.This

shows that awareness about the performance appraisal system is to be increased.

FINDINGS & SUGGESTION

Awareness of appraisal system


10

khushi project

Documents