What Is the Meaning of Negotiable Instruments?Negotiable Instruments is the name of a document that promises to pay a sum of money. The document states that the signer of the document agrees to pay the owner of the document a set amount of money which is also stated on the document.

A negotiable instrument is a document guaranteeing the payment of a specific amount of money, either on demand, or at a set time with the payer named on the negotiable instrument. More specifically, it is a document contemplated by a contract, which warrants the payment of money without condition which may be paid on demand or at a future date.

Examples of negotiable instruments include promissory notes, bills of exchange, bank notes and cheques.

Because money is promised to be paid, the instrument itself can be used by the holder in due course as a store of value. The instrument can be transferred to a third party and it is the holder of the instrument who will ultimately get paid by the payer on the instrument. Transfers can happen at less than the face value of the instrument and this is known as discounting, this may happen for example if there is doubt about the payer's ability to pay.

1.2 MEANING OF NEGOTIABLE INSTRUMENTS

According to Section 13 (a) of the Act, “Negotiable instrument

means a promissory note, bill of exchange or cheque payable either to

order or to bearer, whether the word “order” or “ bearer” appear on the

instrument or not.”

In the words of Justice, Willis, “A negotiable instrument is one, the

property in which is acquired by anyone who takes it bonafide and for

value notwithstanding any defects of the title in the person from whom

he took it”.

Thus, the term, negotiable instrument means a written document

which creates a right in favour of some person and which is freely

transferable. Although the Act mentions only these three instruments

(such as a promissory note, a bill of exchange and cheque), it does not

4

exclude the possibility of adding any other instrument which satisfies the

following two conditions of negotiability:

1. the instrument should be freely transferable (by delivery or

by endorsement. and delivery) by the custom of the trade;

and

2. the person who obtains it in good faith and for value should

get it free from all defects, and be entitled to recover the

money of the instrument in his own name.

As such, documents like share warrants payable to bearer,

debentures payable to bearer and dividend warrants are negotiable

instruments. But the money orders and postal orders, deposit receipts,

share certificates, bill of lading, dock warrant, etc. are not negotiable

instruments. Although they are transferable by delivery and

endorsements, yet they are not able to give better title to the bonafide

transferee for value than what the transferor has.

Distinction Between A Public Company And a Private Company – Following are the main points of difference:

1. Minimum Paid-up Capital : A Private Company must have a minimum paid-up capital of Rs. 1,00,000, whereas a Public Company must have a minimum paid-up capital of Rs. 5,00,000.

2. Minimum number of members : Private limited company 2, Public Company 7.

3. Maximum number of members : Private Ltd. Company 50, no restriction of maximum number of members in a Public Company.

4. Transerferability of shares : There is complete restriction on the transferability of the shares of a Private Company through its Articles of Association , whereas there is no restriction on the transferability of the shares of a Public company

5 .Issue of Prospectus : A Private Ltd.Company cannot issue Prospectus, whereas a Public Ltd. Company Company can issue a Prospectus.

6. Number of Directors : A Private Company may have 2 directors, whereas a Public Company must have atleast 3 directors.

7. Consent of the directors : There is no need to give the consent by the directors of a Private Company, whereas the Directors of a Public Company must file with the Registrar a consent to act as Director of the company.

8. Qualification shares : The Directors of a Private Company need not sign an undertaking to acquire the qualification shares, whereas the Directors of a Public Company are required to sign an undertaking to acquire the qualification shares of the public Company .

9. Commencement of Business : A Private Company can commence its business immediately after its incorporation, whereas a Private Company cannot start its business until a Certificate to commencement of business is issued to it.

10. Shares Warrants : A Private Company cannot issue Share Warrants against its fully paid shares, Whereas a Private Company can issue Share Warrants against its fully paid up shares.

11. Further issue of shares : A Private Company need not offer the further issue of shares to its existing share – holders, whereas a Public Company has to offer the further issue of shares to its existing share – holders as right shares. Further issue of shares can only be offer to the general public with the approval of the existing share – holders in the general meeting of the share – holders only.

12. Statutory meeting : A Private Company has no obligation to call the Statutory Meeting of the member, whereas of Public Company must call its statutory Meeting and file Statutory Report with the Register of Companies.

13. Quorum : The quorum in the case of a Private Company is TWO members present personally, whereas in the case of a Public Company FIVE members must be present personally to constitute

quorum. However, the Articles of Association may provide and number of members more than the required under the Act.

14. Managerial remuneration : Total managerial remuneration in the case of a Public Company cannot exceed 11% of the net profits, and in case of inadequate profits a maximum of Rs. 87,500 can be paid. Whereas these restrictions do not apply on a Private Company.

15. Special privileges : A Private Company enjoys some special privileges, which are not available to a Public Company.

The following are the main points of distinction between a private limited company and a public limited company :1. Minimum number of members

The minimum number of members to constituted a private company is two but a public company cannot be formed unless there are at least seven members.

2. Maximum number of members

The maximum number of members is case of a private company is fifty but there is no maximum limit of members for a public company. It can have members equal to the number of shares issued by it.

3. Issue of Prospectus

A private company cannot invite public to subscribe to its shares or debentures by issue of prospectus for inviting public to subscribe to its shares or debentures. Membership of a private company is restricted to friends because it cannot invite public to subscribe to its shares.

4. Transfer of shares

The transfers if shares is generally restricted by the articles of association of a private company. But the shares of a public company are freely transferable to subscribe to its shares.

5. Commencement of business

A private company can allot shares and commence business after getting the certificate of incorporation from the Registrar of Companies. But a public limited

company cannot allot shares unless it has collected minimum subscription and has received at least 5 % of the nominal amount of shares applied in cash on application. It can commence business only after getting the certificate of commencement of businesses. As per recent guidelines issued by Central Government, the minimum subscription in case of public or right issue of shares or debentures, has been fixed at 90 % of the entire issue. Such subscription must be raised within 90 days of the close of issue.

6. Number of directors

A private limited company must have at least two directors whereas a public limited company is required to have at least three directors.

7. Quorum for meetings

The quorum for a meeting of a private company is two while five members constitute a quorum in case of a public company.

8. Use of the word 'Limited'

In case of a private company, the word 'Private Limited' must be used at the end of the name of a company. But the word 'Limited' is used at the end of the name of public company.

9. Legal formalities

A private limited company is required to observe a less number of legal formalities as compared to a public company. For example, a private company is not required to call a statutory meeting and to file a statutory report to the Registrar of Companies. A private company need nit send the list of directors, a director's consent to act as such, a director's contract to take up qualification shares etc, to the Registrar of Companies.

10. Restriction regarding managerial remuneration

Public limited companies cannot pay managerial remuneration in any financial year more than 11 % of the net profits of the company for that financial year. But no such restrictions applies in case of a private limited company.

The Advantages of Direct & Indirect Taxesby Craig Berman

While paying taxes is nobody's favorite activity, it's something everyone has to do in order to keep government programs rolling. Direct taxes are paid by individuals and businesses directly to the government based on income and earnings, while indirect taxes are based on transactions involving money or its equivalent for something of value. Each has its advantages and disadvantages, largely based on individual earnings and spending habits.DIRECT TAXESDirect taxes are those imposed directly by the government against an individual or organization, with that party being responsible for remitting the money owed. Taxes may be paid directly by the specific party or by others on their behalf, but ultimately it is the individual or organization responsible for them. You may have tax withheld by your company every payday, and the company may send that to the IRS, but on April 15 you are the one responsible for making sure your income tax is paid.INDIRECT TAXESIndirect taxes are collected as the result of financial or commercial activities. When you go to the store and buy groceries, or head to the dealership and purchase a new car, there are often taxes associated with those transactions. While you pay the tax at the point of sale, it is the business owner who is responsible for its collection and transmittal to the government.PROGRESSIVE VS. REGRESSIVEThe type of tax you favor depends largely on what kind of system you consider to be more equitable. In a system relying on direct taxation, those who earn the most pay the most in taxes, making it a progressive tax. Indirect taxes are classified as regressive, because they are not based on income levels, and, generally, lower-income households pay more in indirect taxes as a percentage of their income. Direct taxes are based on what you make, while indirect taxes are based on what you spend.DIRECT TAXATION ADVANTAGESDirect taxes tend to be more predictable than indirect taxes. Everyone pay at rate commensurate with their earnings, and so both the taxpayer and the government can estimate what the bill will be. This makes it easier for both to budget. Theoretically, it serves as a mechanism to reduce income inequality by easing the tax burden on poorer households, which can help drive business by increasing the customer base. It’s also easier for the government to raise money relatively quickly through raising taxes, or encourage growth or an influx of capital by limiting them.INDIRECT TAXATION ADVANTAGES

Because indirect taxes are collected as the result of commercial activity, there is more discretion as to how much an individual pays. You can control the indirect taxes you owe by controlling what you

spend. If you don’t buy anything or shop only in areas that don't levy sales taxes, you won’t pay indirect taxes. Indirect taxes can also be used as a policy tool by the government to encourage or discourage specific consumer behaviors. An increase in the gas tax, for example, will cause commuters to spend more money every time they fill up their car. Some states may use that as a way of funding transportation projects, or encouraging mass transit.

Indirect taxes have advantages of their own. Briefly speaking they are as under:—

1. They are the only means of reaching the poor. It is a sound principle that every individual should pay something, however little, to the State. The poor are always exempted from paying direct taxes. They can be reached only through indirect taxation.

2. They are convenient to both the tax-payer and the State. The tax-payers do not feel the burden much, partly because an indirect tax is paid in small amounts and partly because it is paid only when making purchases. But the convenience is even greater due to the fact that the tax is "price-coated". It is wrapped in price. It is like a sugar-coated quinine pill. Thus, a tobacco tax is not fell when it is included in the price of every cigarette bought. It is convenient to the State as well which can collect the tax at the ports or at the factory. A dealer collects the tax when he charges a price. He is a honorary tax collector.

3. Indirect taxes can be spread over a wide range. Very heavy direct taxation at just one point may produce harmful effects on social and economic life. As indirect taxes can be spread widely, they are more beneficial and suitable.

4. They are easy to collect. Collection takes place automatically when goods are bought and sold.

1. They cannot be evaded, as they are a part of the price. They can be evaded only when the taxed article is not consumed, and this may not always be possible.

6.  They are very elastic in yield, if imposed on necessaries of life which have an inelastic demand. Indirect taxes on necessaries yield large revenue, because people must buy these things.

7.  When imposed on luxuries or goods consumed by the rich, they are equitable. In such cases only the well-to-do will pay the tax.

8.  They check consumption of harmful commodities. That is why tobacco, wine and other intoxicants are taxed.

 

Advantages of Indirect Taxes

1. Convenient in Payment :-It is very easy to pay because they are included in prices. The consumer often does not know that he is paying the tax.

2. No One can Evade the Tax :-Any one who will purchase the taxed commodity, will pay the tax. So it is not possible to evade indirect tax.

3. Contribution from Every Citizen :-Indirect tax is very useful because every member of the society contributes something towards the revenue of the state.

4. Elastic :-Indirect tax is also elastic to a certain extent. The state can increase its revenue within limits by increasing the rate of taxes.

5. Control on Harmful Goods :-If the state wishes to discourage the consumption of harmful drugs, it can raise their prices by increasing the taxes on them.

6. Tax on Luxury Items :-The indirect tax satisfied the canon of equality. If it is imposed on luxury goods, then rich people will pay more taxes and poor will not pay because they do not purchase it.

Private carrierFrom Wikipedia, the free encyclopedia

A private carrier is a company that transports only their own goods.[1] The carrier's primary business

is not transportation.

Private carriers may refuse to sell their services at their own discretion, whereas common carriers

must treat all customers equally. Some corporations mix both systems, using common carriers and

private carriage in what is called a blended operation.

Private carriage usually refers to trucking, but is also found in rail and water transportation, as well

as communication. Private carriage is distinguished fromindependent carrier, which is an individual

owner-operator or trucker who may make deals with private carriers, common carriers, contract

carriers, or others as he or she wishes. Private carrier may also refer to communication or

communication services. Certain frequencies which are restricted to use by law enforcement are

sometimes called "private carriers". Station class codes beginning with FB6 or FB7 are private

carriers. In the telecommunications industry, defining "private carrier" and "common carrier" has

become increasingly difficult with the growth of mobile phone service providers, VOIP, and other

non-traditional means of delivering communication services.

Common carrierFrom Wikipedia, the free encyclopedia

Jump to: navigation, search

A common carrier in common law countries (corresponding to a public carrier in civil law systems,[1] usually called simply a carrier) is a person or company that transports goods or people for any person or company and that is responsible for any possible loss of the goods during transport.[2] A common carrier offers its services to the general public under license or authority provided by a regulatory body. The regulatory body has usually been granted "ministerial authority" by the legislation that created it. The regulatory body may create, interpret, and enforce its regulations upon the common carrier (subject to judicial review) with independence and finality, as long as it acts within the bounds of the enabling legislation.

A common carrier is distinguished from a contract carrier (also called a public carrier in UK English),[2] which is a carrier that transports goods for only a certain number of clients and that can refuse to transport goods for anyone else, and from a private carrier. A common carrier holds itself out to provide service to the

general public without discrimination (to meet the needs of the regulator's quasi judicial role of impartiality toward the public's interest) for the "public convenience and necessity". A common carrier must further demonstrate to the regulator that it is "fit, willing, and able" to provide those services for which it is granted authority. Common carriers typically transport persons or goods according to defined and published routes, time schedules, and rate tables upon the approval of regulators. Publicairlines, railroads, bus lines, taxicab companies, cruise ships, motor carriers (i.e., trucking companies), and other freight companies generally operate as common carriers. Under US law, an ocean freight forwarder cannot act as a common carrier.[2]

Gratuitous Carrier :-If any person carries the goods or passengers without any reward or charge, it is called gratuitous carrier. No action can be taken against him if he refuses to accept the goods and passengers. On the other hand if he undertakes to carry the goods or passengers then he will be also responsible for the loss caused by him.

Private Carrier :-A person who carries the goods occasionally or by a special agreement is called a private carrier. A private carrier is not a regular carrier. He carries the the gods under special agreements. He carries the goods occasionally. He performs his duties as a bailee.

Example :- There are large number of firms which are supplying their product with their own trucks and vans. In Bombay the firms of Pepsi Cola supplies the bottles of Pepsi by their own trucks. It is an example of Private Carrier.

Q. Rules regarding proposal and offer:1) At the too, a proposal must be a definite proposal/offer by one and unqualifiedacceptance by the other.2) A proposal may be expressed or may be implied. Acceptance can be expressed orimplied.3) A proposal is to obtain the assent of the other eg: person and the intention is tocreate a legal relationship.4) It should be to a definite person definite class of person or to the world at large.5) The terms of proposal must be certain.6) A mere statement of intention is not an offer of. Price list and catalogs. A morestatement of intention is not a proposal but invitation to others to make proposal.

7) Proposal must be communicated to the person to whom it is made.8) An offer or proposal may be conditional. A proposal may be made subject tocertain conditions.9) The person to whom a proposal is indented can accept it.Q.Rules regarding acceptance:1) Acceptance must be an absolute and unqualified. sec. 7 (1) In order to convert aproposal into a promise the acceptance must be absolute and unqualified.2) Sec 7(2) – the acceptance must be expressed in some usual and reasonablemanner. Unless the proposal prescribed the manner in which it is to be accepted.3) Mental acceptance or uncommunicated acceptance does not result in a contract.

Importance of Human Resource ManagementAn organisation cannot build a good team of working professionals without good Human Resources. The key functions of the Human Resources Management (HRM) team include recruiting people, training them, performance appraisals, motivating employees as well as workplace communication, workplace safety, and much more. The beneficial effects of these functions are discussed here:

Recruitment and TrainingThis is one of the major responsibilities of the human resource team. The HR managers come up with plans and strategies for hiring the right kind of people. They design the criteria which is best suited for a specific job description. Their other tasks related to recruitment include formulating the obligations of an employee and the scope of tasks assigned to him or her. Based on these two factors, the contract of an employee with the company is prepared. When needed, they also provide training to the employees according to the requirements of the organisation. Thus, the staff members get the opportunity to sharpen their existing skills or develop specialised skills which in turn, will help them to take up some new roles.Performance AppraisalsHRM encourages the people working in an organisation, to work according to their potential and gives them suggestions that can help them to bring about improvement in it. The team communicates with the staff individually from time to time and provides all the necessary information regarding their performances and also defines their respective roles. This is beneficial as it enables them to form an outline of their anticipated goals in much clearer terms and thereby, helps them execute the goals with best possible efforts. Performance appraisals, when taken on a regular basis, motivate the employees.Maintaining Work AtmosphereThis is a vital aspect of HRM because the performance of an individual in an organisation is largely driven by the work atmosphere or work culture that prevails at the workplace. A good working

condition is one of the benefits that the employees can expect from an efficient human resource team. A safe, clean and healthy environment can bring out the best in an employee. A friendly atmosphere gives the staff members job satisfaction as well.Managing DisputesIn an organisation, there are several issues on which disputes may arise between the employees and the employers. You can say conflicts are almost inevitable. In such a scenario, it is the human resource department which acts as a consultant and mediator to sort out those issues in an effective manner. They first hear the grievances of the employees. Then they come up with suitable solutions to sort them out. In other words, they take timely action and prevent things from going out of hands.Developing Public RelationsThe responsibility of establishing good public relations lies with the HRM to a great extent. They organise business meetings, seminars and various official gatherings on behalf of the company in order to build up relationships with other business sectors. Sometimes, the HR department plays an active role in preparing the business and marketing plans for the organisation too.Any organisation, without a proper setup for HRM is bound to suffer from serious problems while managing its regular activities. For this reason, today, companies must put a lot of effort and energy into setting up a strong and effective HRM.

The Importance of the Human Resource Function 

Human resource is the backbone of any business. It deals with the most important resource in the business – people. For any business to achieve its objectives they must plan their resources and one of their key resources is people. They need to get the right people and develop them well in order to meet the organisation’s aims successfully. 

As an organisation grows and expands, the human resource department will know that the organisation needs to recruit more staff and they plan carefully. Recruiting staff in an organisation is very expensive and costly, so the human resource function helps the organisation to get recruitment right. 

The main elements of Human resource are: 

* Planning 

* Recruitment & Selection 

* Training & Development 

* Performance Measurement. 

PLANNING 

Planning is a process of determining the goals and objectives of a business for a future period of time, developing the strategies guiding the firm’s operations and utilizing resources towards achieving the set goals and objectives. 

A human resource manager needs to plan ahead and know what is going on in and outside the company (labour market). He needs to be aware of the past, present and future trends of employment in a particular area of specialisation. 

He needs to know if there are available skills needed or if there are few people with the type of skill needed by the company. He also needs to be aware for competition for employees’ i.e. if the company’s employees are increasing the demand for labour or whether labour is available due to redundancies. 

The HR planning is all about getting the right people and developing them to meet the company’s objectives. 

RECRUITMENT & SELECTION 

The HR manager needs to know when, why and how to recruit staff. Businesses recruit staff so as to expand the business objectives and change job roles within the business due to new skills and new technology. 

New staffs are also recruited because the company needs to fill vacancies due to dismissal, death or resignation of a member of staff, or to fill vacancies due to internal promotion of a member of staff. 

A business has to get recruitment right because it is very expensive. The HR manager will have to select the right people into jobs because there is the probability of rejecting the best ones and getting the wrong ones. 

TRAINING & DEVELOPMENT ---------------------- 

The HR manager needs to be aware of the importance of training and developing their employees as it adds to the competitive success of the business. 

Training could be described as a learning experience or activity aimed at making a positive change on the performance of employees which will in turn lead to the success of the company. 

Training could be in various forms such as education, induction, apprenticeship or management training. 

Training enables an employee to contribute in meeting the aims and objectives of a business while development on the other hand enables an employee to develop himself / herself as a person. 

This aspect of the human resource responsibility helps employees to develop themselves and contribute in meeting the organisation’s goals and objectives. To achieve its objectives, an organisation has to train and develop its people so they could support the organisation by working towards meeting the company’s objectives. 

PERFORMANCE MANAGEMENT 

In order to be competitive, a business needs to monitor the performance of its employees effectively. 

Some of the methods businesses use to monitor the performance of their employees include: 

Ø Performance Reviews: a business will have to set out a mission statement identifying its aims and objectives and also create value statement on how these aims will be accomplished. 

The success of the company as well as the performance of employees can be monitored and evaluated for improvement using the set objectives of the company. A feedback known as performance appraisal is then given to evaluate the performance of the company and give room for performance adjustments. 

Ø Self Evaluation: employees are encouraged to make goals and evaluate their own performance in meeting these goals. This enables employees to take responsibility and monitor their own performance. It helps employees to develop inter – personal relations and let them know what exactly their job is all about. 

Ø Peer Evaluation: checks the result of a team work and helps the team to work together effectively and efficiently. This helps employees to value each other’s contributions on matters affecting the success of the company. 

Ø Target Setting for Individual / Groups: this is a process where targets are set in alignment with the department goals, which are set to meet the company’s goals. 

Ø Measuring Individual / Group Output: most companies use how competent an employee or group is to measure their performance. An employee could either be rewarded in form of bonuses or increments in salaries based on his performance. 

Explain the concept of Human Resource Development.Explain the concept of Human Resource Development. Discuss various HRD systems and sub-systems in your organization or any organization you are familiar with. Which of these systems are effective and why? 

Human Resource Development (HRD) is the integrated use of training, organizational development, and career development efforts to improve individual, group, and organizational effectiveness. 

Human resources are the assets, which do not find a place for mentioning in the balance sheet of company. But it is one of the most important assets as human resources are a resource of production as well as they are utilizing other resources of production like a material, machines, money etc. Any investment made on training and development of people is sure to show the results in the years to come. The results of any HRD plan or scheme appear in long term. 

HRD is neither a concept nor a tool, but is an approach using different personnel systems, depending upon the needs and priorities of the organization. The basic assumption is the belief in human potential and its development by providing a suitable and congenial environment.

Various HRD sub system that i am familiar with are as follows:Performance AppraisalPerformance appraisal of some type is practiced in most organisations all over the world. A written assessment to which the employee has no chance to respond is still common in most countries, particularly in the developing countries.

An HRD-oriented performance appraisal is used as a mechanism for supervisors to:1. To control the difficulties of their subordinates and try to remove these difficulties.2. Help the subordinates to become aware of their-positive contributions.3. Encourage subordinates to become aware of their positive contributions.5. To gain new capabilities.6. Plan for effective utilization of the talents of subordinates.

In HRD organisations every supervisor has the responsibility to ensure the development of his or her subordinates in relation to the capabilities required to perform their jobs evocatively. Such performance appraisal interviews may be scheduled every three months or once or twice a year. During this review the supervisor attempts to understand the difficulties of the subordinate and to identify his or her developmental needs.

The supervisor also prepares for the meeting by listing observations, problems, suggestions, and expectations. During the appraisal meeting, the supervisor and the subordinate share their observations and concerns Such. discussions help to develop mutual understanding, and the data generated are reported to the higher management and is used in making decisions about individual employee development as well as developmental needs of the

work group or the entire organisation.

Potential Appraisal and DevelopmentIn organisations that subscribe to HRD, the potential (Career-enhancement possibilities) of every employee is assessed periodically. Assessment is basically used for placement and development planning. If under this system the company is growing continuously. It may be larging in scale diversifying its operation introducing technological changes or entering new markets. Capabilities to perform new roles and responsibilities must continually be developed among employees.

Of course, many supervisors see their subordinates doing only those jobs to which they are assigned. the ideal way to judge a person's potential would be to try the person on each job for which his potential is being assessed.

Any employee can request such assessment. It should be clear whether or not there is a position available ill the company to which the employee could be transferred or promoted.

Feedback and Performance CoachingKnowledge of one's strengths helps one to become more effective, to choose situations in which one s strengths are required, and to avoid situations in which one's weaknesses could create problems. This also increase the satisfaction of the individual. Often, people do not recognize their strengths. Supervisors in an HRD system have the responsibility for ongoing observation and feedback to subordinates about their strengths and their weaknesses, as well as for guidance in improving performance capabilities.

Career PlanningIn the HRD system, corporate growth plans are not kept secret. Long-range plans for the organisation are made known to the employees. Employees are helped to prepare for change whenever such change is planned; in fact, the employees help to facilitate the change. Major changes are discussed at all levels to increase employee understanding and commitment. It is their responsibility to transmit information to their subordinates and to assist them in planning their careers within the organinsation. Of course, the plans may not become reality, but all are aware of the possibilities and are prepared for them.

TrainingTraining is linked with performance appraisal and career development. Employees generally are trained on the job or through special in-house training programmes.. For some employees (including managers), outside training may be utilised to enhance, update, or develop specific skills. This is especially valuable if outside training can provide expertise, equipment, or sharing of experiences that are not available within the organization.

Organisation Development (OD)This function includes research to ascertain the psychological health of the organisation. Efforts are made to improve organisational health through various means in order to maintain a psychological climate that is conducive to productivity. The systems experts also help any department or unit in the company that has problems such as absentees, low production, interpersonal conflict or resistance to change. These experts also revamp and develop various systems within the organization to improve their functioning.

RewardsRewarding employee performance and behaviour is an important part of HRD. Appropriate rewards not only recognise and motivate employees, but also communicate the organisation's values to the employees. In HRD systems, innovations and use of capabilities are rewarded in order to encourage the acquisition and application of positive attitude and skills. Promotions are generally not considered as rewards because promotion decisions are based on appraisals of potential whereas most rewards are based on performance. Rewards may be given to individualists as well as to teams, departments, and other units within the organisation.

Employee Welfare and quality of Work LifeEmployees at lower levels in the organisation usually perform relatively monotonous tasks and have fewer opportunities for projection or change. In order to maintain their work commitment and motivation, the organisation must provide some welfare benefits such as medical insurance, disability insurance, and holidays and vacations.

Quality-of-work-life programmes mainly focus on the environment within the organisation and adding basic physical concerns such as air-conditioning and heating, lighting and physical amenities such as food and beverage facilities. HRD systems focusing on employee welfare and quality of work life by regularly examining employee needs and meeting them to the extent feasible. Job enrichment programmes, educational subsidies, recreational activities, health and medical benefits, generate a sense of belonging that benefits the organisation in the long run.

All above information about employees should be stored in a central human resources data bank (usually by means of computer). This data is used whenever there is a need to provide employees for consideraion for special projects, additional training, or higher-level jobs.

EXAMPLE: HUMAN RESOURCES DEVELOPMENT (HRD) AT C-DACIntroduction: Established in March 1988, as a Scientific Society of the Department of Information Technology (formerly, Dept. of Electronics), Ministry of Communications and Information Technology (formerly, Ministry of Information Technology), Government of India, The Centre for Development of Advanced Computing (C-DAC), is primarily an R & D institution involved in the design, development and deployment of advanced Information Technology (IT) based solutions.

Some HRD Systems and Sub-SystemsTraining and Development: Training for C-DACians is based on the philosophy that all are willing pupils. Members are keen to enhance their proficiency, communication skills, computer expertise, potential, leadership and teamwork. Equally important is the Induction Training for the newly recruited members. Wherein, they are expected to move rapidly from the threshold of the organization to its core and become productive quickly. Thus, the Training Policy in C-DAC is targeted towards enhancing The "soft skills" that employees need to work effectively in the organization like, team-building skills, communications, supervisory skills, and  The technical skills required to operate on the cutting edge of technology.

Learning Opportunities: C-DAC encourages acquisition of higher & advanced professional education and qualifications for its members while in service at C-DAC. In a knowledge driven organization like C-DAC, intellectual development of its human resources is a continuous process. In keeping with this philosophy, C-DAC encourages its employees to enhance their educational qualifications and also rewards them by way of increments and reimbursement in emoluments on successful accomplishments.

Mentoring: Starting with a well-organized induction program to familiarize each new member with complete technical activities and administrative processes of C-DAC, there is a continuous mentoring program underway which gives an opportunity to every member to share and discuss ones experiences with another member, a mentor, to give feedback to the management. The protégé thus not only becomes productive fairly early but also contributes to his own development in line with the defined career path and organizational objectives.

PERFORMANCE APPRAISAL:

People differ in their abilities and their aptitudes. There is always some difference between the quality and quantity of the same work on the same job being done by two different people. Performance appraisals of Employees are necessary to understand each employee’s abilities, competencies and relative merit and worth for the organization. Performance appraisal rates the employees in terms of their performance. 

Performance appraisals are widely used in the society. The history of performance appraisal can be dated back to the 20th century and then to the second world war when the merit rating was used for the first time. An employer evaluating their employees is a very old concept. Performance appraisals are an indispensable part of performance measurement. 

Performance appraisal is necessary to measure the performance of the employees and the organization to check the progress towards the desired goals and aims. 

The latest mantra being followed by organizations across the world being – "get paid according to what you contribute" – the focus of the organizations is turning to performance management and specifically to individual performance. Performance appraisal helps to rate the performance of the employees and evaluate their contribution towards the organizational goals. If the process of performance appraisals is formal and properly structured, it helps the employees to clearly understand their roles and responsibilities and give direction to the individual’s performance. It helps to align the individual performances with the organizational goals and also review their performance.

Performance appraisal takes into account the past performance of the employees and focuses on the improvement of the future performance of the employees. Here at naukrihub, we attempt to provide an insight into the concept of performance appraisal, the methods and approaches of performance appraisal, sample performance appraisal forms and the appraisal softwares available etc. An attempt has been made to study the current global trends in performance appraisal. 

Once a Year Overview every company give the appraisal and HR need to give Self Appraisal form to employees ,HR need to conduct meeting to review Performance

Performance Appraisal Methods : 

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 employee’s level of performance. This is the oldest and most widely method used for performance appraisal.

5. Essay Evaluation

This method asked managers / supervisors to describe strengths and weaknesses of an employee’s behavior. Essay evaluation is a non-quantitative technique. This method usually use with the graphic rating scale method.

6. Behaviorally anchored rating scales

This method used to describe a performance rating that focused on specific behaviors or sets as indicators of effective or ineffective performance. It is a combination of the rating scale and critical incident techniques of employee performance evaluation.

7. Performance ranking method

Ranking is a performance appraisal method that is used to evaluate employee performance from best to worst.

Manager will compare an employee to another employee, rather than comparing each one to a standard measurement.

8. Management By Objectives (MBO)

MBO is a process in which managers / employees set objectives for the employee, periodically evaluate the performance, and reward according to the result.

MBO focuses attention on what must be accomplished (goals) rather than how it is to be accomplished (methods)

9. 360 degree performance appraisal

360 Degree Feedback is a system or process in which employees receive confidential, anonymous feedback from the people who work around them.

10.Forced ranking (forced distribution)

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

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.

11. Behavioral Observation Scales

Behavioral Observation Scales is frequency rating of critical incidents that worker has performed.

Most of the companies or organisations follow 360 degree performance appraisal.

TECHNIQUES / METHODS OF PERFORMANCE APPRAISALS Numerous methods have been devised to measure the quantity and quality of performance appraisals. Each of the methods is effective for some purposes for some organizations only. None should be dismissed or accepted as appropriate except as they relate to the particular needs of the organization or an employee.

Broadly all methods of appraisals can be divided into two different categories.

Past Oriented Methods Future Oriented Methods

Past Oriented Methods1.    Rating Scales: Rating scales consists of several numerical scales representing job related performance criterions such as dependability, initiative, output, attendance, attitude etc. Each scales ranges from excellent to poor. The total numerical scores are computed and final conclusions are derived. Advantages – Adaptability, easy to use, low cost, every type of job can be evaluated, large number of employees covered, no formal training required. Disadvantages – Rater’s biases2.    Checklist: Under this method, checklist of statements of traits of employee in the form of Yes or No based questions is prepared. Here the rater only does the reporting or checking and HR department does the actual evaluation. Advantages – economy, ease of administration, limited training required,

standardization. Disadvantages – Raters biases, use of improper weighs by HR, does not allow rater to give relative ratings3.    Forced Choice Method: The series of statements arranged in the blocks of two or more are given and the rater indicates which statement is true or false. The rater is forced to make a choice. HR department does actual assessment. Advantages – Absence of personal biases because of forced choice. Disadvantages – Statements may be wrongly framed.4.    Forced Distribution Method: here employees are clustered around a high point on a rating scale. Rater is compelled to distribute the employees on all points on the scale. It is assumed that the performance is conformed to normal distribution. Advantages – Eliminates Disadvantages – Assumption of normal distribution, unrealistic, errors of central tendency.5.    Critical Incidents Method: The approach is focused on certain critical behaviors of employee that makes all the difference in the performance. Supervisors as and when they occur record such incidents. Advantages – Evaluations are based on actual job behaviors, ratings are supported by descriptions, feedback is easy, reduces recency biases, chances of subordinate improvement are high. Disadvantages – Negative incidents can be prioritized, forgetting incidents, overly close supervision; feedback may be too much and may appear to be punishment.6.    Behaviorally Anchored Rating Scales: statements of effective and ineffective behaviors determine the points. They are said to be behaviorally anchored. The rater is supposed to say, which behavior describes the employee performance. Advantages – helps overcome rating errors. Disadvantages – Suffers from distortions inherent in most rating techniques.7.    Field Review Method: This is an appraisal done by someone outside employees’ own department usually from corporate or HR department. Advantages – Useful for managerial level promotions, when comparable information is needed, Disadvantages – Outsider is generally not familiar with employees work environment, Observation of actual behaviors not possible.8.    Performance Tests & Observations: This is based on the test of knowledge or skills. The tests may be written or an actual presentation of skills. Tests must be reliable and validated to be useful. Advantage – Tests may be apt to measure potential more than actual performance. Disadvantages – Tests may suffer if costs of test development or administration are high.9.    Confidential Records: Mostly used by government departments, however its application in industry is not ruled out. Here the report is given in the form of Annual Confidentiality Report (ACR) and may record ratings with respect to following items; attendance, self expression, team work, leadership, initiative, technical ability, reasoning ability, originality and resourcefulness etc. The system is highly secretive and confidential. Feedback to the assessee is given only in case of an adverse entry. Disadvantage is that it is highly subjective and ratings can be manipulated because the evaluations are linked to HR actions like promotions etc.10.  Essay Method: In this method the rater writes down the employee description in detail within a number of broad categories like, overall impression of performance, promoteability of employee, existing capabilities and qualifications of performing jobs, strengths and weaknesses and training needs of the employee. Advantage – It is extremely useful in filing information gaps about the employees that often occur in a better-structured checklist. Disadvantages – It its highly dependent upon the writing skills of rater and most of them are not good writers. They may get confused success depends on the memory power of raters.11.  Cost Accounting Method: Here performance is evaluated from the monetary returns yields to his or her organization. Cost to keep employee, and benefit the organization derives is ascertained. Hence it is more dependent upon cost and benefit analysis.12.  Comparative Evaluation Method (Ranking & Paired Comparisons): These are collection of different methods that compare performance with that of other co-workers. The usual techniques used may be ranking methods and paired comparison method.

Ranking Methods: Superior ranks his worker based on merit, from best to worst. However how best and why best are not elaborated in this method. It is easy to administer and explanation.

Paired Comparison Methods: In this method each employee is rated with another employee in the form of pairs. The number of comparisons may be calculated with the help of a formula as under.N x (N-1) / 2

Future Oriented Methods1.    Management By Objectives: It means management by objectives and the performance is rated against the achievement of objectives stated by the management. MBO process goes as under.

Establish goals and desired outcomes for each subordinate Setting performance standards Comparison of actual goals with goals attained by the employee Establish new goals and new strategies for goals not achieved in previous year.

Advantage – It is more useful for managerial positions.

Disadvantages – Not applicable to all jobs, allocation of merit pay may result in setting short-term goals rather than important and long-term goals etc.

2.    Psychological Appraisals: These appraisals are more directed to assess employees potential for future performance rather than the past one. It is done in the form of in-depth interviews, psychological tests, and discussion with supervisors and review of other evaluations. It is more focused on employees emotional, intellectual, and motivational and other personal characteristics affecting his performance. This approach is slow and costly and may be useful for bright young members who may have considerable potential. However quality of these appraisals largely depend upon the skills of psychologists who perform the evaluation.3.    Assessment Centers: This technique was first developed in USA and UK in 1943. An assessment center is a central location where managers may come together to have their participation in job related exercises evaluated by trained observers. It is more focused on observation of behaviors across a series of select exercises or work samples. Assessees are requested to participate in in-basket exercises, work groups, computer simulations, role playing and other similar activities which require same attributes for successful performance in actual job. The characteristics assessed in assessment center can be assertiveness, persuasive ability, communicating ability, planning and organizational ability, self confidence, resistance to stress, energy level, decision making, sensitivity to feelings, administrative ability, creativity and mental alertness etc. Disadvantages – Costs of employees traveling and lodging, psychologists, ratings strongly influenced by assessee’s inter-personal skills. Solid performers may feel suffocated in simulated situations. Those who are not selected for this also may get affected.Advantages – well-conducted assessment center can achieve better forecasts of future performance and progress than other methods of appraisals. Also reliability, content validity and predictive ability are said to be high in assessment centers. The tests also make sure that the wrong people are not hired or promoted. Finally it clearly defines the criteria for selection and promotion.4.    360-Degree Feedback: It is a technique which is systematic collection of performance data on an individual group, derived from a number of stakeholders like immediate supervisors, team members, customers, peers and self. In fact anyone who has useful information on how an employee does a job may be one of the appraisers. This technique is highly useful in terms of broader perspective, greater self-development and multi-source feedback is useful. 360-degree appraisals are useful to measure inter-personal skills, customer satisfaction and team building skills. However on the negative side, receiving feedback from multiple sources can be intimidating, threatening etc. Multiple raters may be less adept at providing balanced and objective feedback.

QUALITY OF WORK LIFE (QWL)

< Professional Services.. Random Testing.. >

Quality of Work Life is becoming an increasingly popular concept in recent times. It basically talks about the methods in which an organisation can ensure the holistic well-being of an employee instead of just focusing on work-related aspects.

 

It is a fact that an individual’s life can’t be compartmentalised and any disturbance on the personal front will affect his/her professional life and vice-versa. Therefore, organisations have started to focus on the overall development and happiness of the employee and reducing his/her stress levels without jeopardising the economic health of the company.

Methods

Questionnaires Questionnaires should be forwarded by E-mail to the institutes at least two-three weeks before the visits by consultants. The questionnaires should consist of three separate questionnaires to be completed by potential training candidates (= respondents): Q1. A profile of potential training candidates (personal history form). Q2. A description of job functions and tasks performed by potential training candidates. Q3. An assessment of the training needs, skills and knowledge, as identified by potential training candidates.

The Training Needs Assessment should only cover staff involved with marine resource assessment and related activities at the national fisheries research institutes, and therefore should be handed to selected staff only. The questionnaires are designed to provide basic personal information as well as being the main source of information for the assessment of staff knowledge and need for training in topics related to fishery resources assessment.

Questionnaire1 is designed to collect basic personal information. In Questionnaire 2 respondents are presented with a list of the major job functions normally assigned to staff involved in the assessment of natural resources at National Fisheries Institutes. In

the list, respondents are asked to identify the job functions that best correspond to the job functions in their present position. Under each major job function, tasks are listed, that are normally performed by fisheries officers. Respondents are then asked to rate how often they perform each task; how important they rate the task compared to other tasks; and whether they have difficulties in performing the task, by using rating scales. In Questionnaire 3 respondents are asked to rate their competency, i.e. skills and knowledge, in a number of disciplines and activities directly or indirectly related to the job functions and tasks, that have been identified in Questionnaire 2. Three questions are to be answered: at what level do you possess the skill or knowledge?; how important is the skill or knowledge for your present job?; and how do you perceive your need for training in this discipline/subject? Again, each respondent is asked to use a rating scale for their answers.