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A study on performance appraisal conducted at hamul, hassan

A study on performance appraisal conducted at hamul, hassan

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  • 1. Performance Appraisal “A STUDY ON PERFORMANCE APPRAISAL OF EMPLOYEES AT HAMUL, HASSAN” INTRODUCTION: Appraising the performance of the individual, groups and organization is a common practice of all societies. While in some instance these appraisal processes are structured and formally sanctioned, in other instances they are an integral and informal part of daily activities. The teacher evaluates the performance of student, banker evaluates the performance of creditors, parents evaluate the performance of their children and all of unconsciously or unconsciously evaluate our own action from time to time. In social interaction, performance evaluation is done in a haphazard an often unsystematic way. But in organization formal programs of evaluating employee and managerial performance-conducted in a systematic and planned manner have achieved popularity in recent years. During and after world war-1, the systematic performance appraisal was quite prominent. Credit goes to Walter dill Scott for systematic performance appraisal technique of man to man rating system (or merit rating). It was used for evaluating military officers. Industrial concern also used this system during 1920 and 1940’s for evaluating hourly paid workers. However with the increase of training and management development programs from 1950’s management started adopting performance appraisal for evaluating technical, skilled, professional and managerial personnel as a part of training and managerial development programs. With this evolutionary process, the term merit rating and been charged into employee appraisal or performance appraisal. This is not mere change in the term but a change in the scope of the activity as the emphasis of merit rating was limited to personnel traits, whereas performance appraisal covers result, accomplishment and performance. Therefore performance appraisal enables employee to get incentive treatment according to their potential, sincerity and capabilities. They get motivated by which, performance appraisal benefits not only employee but also the management in the form of greater productive efficiency. H.R. Institute Of Higher Education, Hassan 1
  • 2. Performance Appraisal STATEMENT OF PROBLEM: A study on effectiveness of “performance appraisal of employees” at HAMUL, Hassan. OBJECTIVES OF THE STUDY: • To study performance appraisal system • To understand and evaluate performance appraisal mechanism in operation. • To evaluate the effectiveness and satisfaction level of the employees towards performance appraisal system in HAMUL SCOPE OF THE STUDY: • The study covers employees of HAMUL. • Survey was conducted on the method of performance appraisal system that was used in “HAMUL”. • The study focuses on evaluation of design, implementation, feedback, participation, parameters of the appraisal system only. H.R. Institute Of Higher Education, Hassan 2
  • 3. Performance Appraisal • To help management plan for development and growth. • The target samples of 50 technical employees were selected at random from the same level. RESEARCH METHODOLOGY: Appraisal system- Performance appraisal design: 1. Design: personal interaction. Questionnaire. 2. Observation: personal observation. Indirect observation. SAMPLING DESIGN: H.R. Institute Of Higher Education, Hassan 3
  • 4. Performance Appraisal Sampling is the process of obtaining information about an entire population by examining only a part of it. Sampling plan calls for three decisions. a) Sampling unit b) Sampling size c) Sampling procedure The design to be adopted for the study will be based on convenient sampling. The population for the study will consist of employees in the KMF sector from different cities. Sampling unit: “HAMUL” Sampling size: 50 technical employees H.R. Institute Of Higher Education, Hassan 4
  • 5. Performance Appraisal Sampling procedure: For the study, respondents were selected on the basis of random sampling. Type of the study: The study is a descriptive study. It is based on data collected through structured questionnaire from the respondents. Sources of data: The study requires both primary and secondary data. Primary data:  Questionnaires  Personal interviews H.R. Institute Of Higher Education, Hassan 5
  • 6. Performance Appraisal Secondary data:  Indirect observation  Library and research works  Internet, web portals and blogs  Books. Secondary data will be used to analyze the primary data in the light of real world situation. Analysis of data: The collected primary data will be analyzed with the help of statistical tools and techniques. Data Presentation Tools Used: Primary data was collected through the questionnaire by distributing questionnaires; questionnaire with both close ended and open ended questions have been used as sample respondents. On the basis of the tables, the facts are presented in the form of various charts. H.R. Institute Of Higher Education, Hassan 6
  • 7. Performance Appraisal Limitations Of The Study: • The study is confined to HAMUL only. • The interpretations and recommendations applicable only to this cooperative • The study was conducted on the assumptions that the information is given by respondents all are correct. • Sample size is restricted to 50 respondents • Time constraints. H.R. Institute Of Higher Education, Hassan 7
  • 8. Performance Appraisal 2.1 INDUSTRY PROFILE India is called the “country of villages” where it covers nearly 70% of its total area. In this relation we can say that Indian economy is base on rural activities and their development. Therefore we have to give prime importance to the rural activities. A dairy is a place for handling milk and milk products. Technology refers to the application of scientific knowledge for practical purposes. Dairy technology has been defined as that branch of dairy science which deals with the processing of milk and the milk products on an industrial scale. In developed dairying countries such as the USA the year 1850 is seen as the dividing line between farm and factory scale production. Various factors distribute to this change in these countries such as the concentration of the population in cities where the jobs are plentiful, rapid industrialization, improvement of transportation facilities, development of machines etc., The rural areas are identified for the production, urban areas are for the processing of the milk. 2.1.1ORIGIN OF DAIRYING IN INDIA H.R. Institute Of Higher Education, Hassan 8
  • 9. Performance Appraisal Around 1500 BC to 2000 BC the Aryans were first to domesticate cattle. Use them for tilling their land obtain milk to be consumed as food. Again it were Aryans who priced the milk of a cow more than its meat, forbade its slaughter, created legends about it and even worshipped it. Hindus even to this day consider cow as sacred. Besides it were only the East (India/China) which domesticated buffalo as milk animal succeeded so well that today, more than half the total production of milk in India is obtained from buffalo. Most of the farmers have one milk animal, they sell the milk through local milk contractors or middlemen. These traders have always exploited the poor and uneducated milk producers. It was in the late forties, when integrated approach for dairy development based on farmers owned milk co-operative was first adopted at Anand. The system includes milk procurement productions and marketing through farmer co-operatives. In India, the market milk technology may be considered to have commenced in1950 with the functioning of the Central Dairy of Aarey Milk Colony and milk product technology in 1956 with the establishment of AMUL dairy, Anand. The system of collective ownership, operation and control of milk trade by farmers came to be known as ANAND PATTERN. Anand pattern has given them an opportunity to have access to the modern technology. The premises institution NDDB and IDC for application of the Anand pattern through out the country. The whole project under which replication was envisioned, is named as “operation flood”. The success of Anand pattern depends as establishing a strong co operative infrastructure at the grass root level, making economically viable to strengthen. Dairy industry offers employment opportunity to the people so as to help the farmers to get fair price of milk. The farmers are provided with medical facilities to their cattle. Milk is becoming an alternative life line in our rural economy. With the advent of white revolution that is “SKHEERA KRANTI” in the same pattern of Denmark and Holland. Export of dairy products plays an important role in our foreign trade. It increases the foreign exchange and national income of our country and also economic development of our country. 2.1.2History of Indian milk market industry: • Organized milk handling was made in India with the establishment of Military Dairy Farms H.R. Institute Of Higher Education, Hassan 9
  • 10. Performance Appraisal • Handling of milk in co operative milk unions established all over the country on a small scale in early stages. • Long distance refrigerated rail-transport of milk from Anand to Bombay since 1945. • Pasteurization and bottling of milk on a large scale for organized distributed was started at: Aarey - 1950 Calautta - 1958 Delhi - 1959 Mumbai - 1961 Madras - 1963 • Establishment of milk plants under the 3 year plans for dairy development all over India. They were taken up the dual object of increasing the national level of milk consumption and ensuring better returns to the primary milk producer. Now India is one of the richest milk producing country in the world. In 1999 it produced milk up to 770 lakhs tons and the milk valued up to 75000 crores and 13% of total production in the world is produced by India itself. 2.1.3 Dairy Industry In Karnataka: Background In June 1974, an integrated project was launched in Karnataka to restructure and reorganize the dairy industry on the co-operative principle and to lay foundation for a new direction in dairy development. Work on the first ever, World Bank aided dairy development project was initiated in 1975. Initially the project covered 8 southern districts of Karnataka and Karnataka Dairy development corporation was set up to H.R. Institute Of Higher Education, Hassan 10
  • 11. Performance Appraisal implement the project. Dairy developmental activities was set up with dairy co operative societies at grass root level, milk unions at the middle level and dairy development corporation at state level as an apex body with the responsibility of implementing Rs.51 crores project. After the closure of operation flood II the dairy development activities which continued under operation flood III ended on 1996. The post operation flood works are financed by NDDB under different terms and conditions. Scope of the union: As at the end of March 2009, a network of 972 Dairy Co operative Societies(DCS) have been organized and are spread over 166 taluks of the total 175 taluks in all the 27 districts of Karnataka. Unions are formed by federating societies in earmarked geographical area. The Brand ' ' is the household name for Pure and Fresh milk and milk products. KMF has 13 Milk Unions throughout the State which procure milk from Primary Dairy Cooperative Societies (DCS) and distribute milk to the consumers in various Towns/Cities/Rural markets in Karnataka. Bangalore Belgaum Dakshina Kannada Gulbarga Shimoga Bijapur Mysore Bellary Mandya Dharwar Tumkur Kolar Hassan The Corporate Office of the Karnataka Milk Federation is located on Dr.M.H.Marigowda Road in Bangalore. The Federation has a Board consisting representatives of Milk Producers and the Government nominees. The day to day functions of the Federation is managed by a group of professional managers headed by the Managing Director H.R. Institute Of Higher Education, Hassan 11
  • 12. Performance Appraisal Karnataka Cooperative Milk Producers' Federation Limited (KMF) is the Apex Body in Karnataka representing Dairy Farmers' Co-operatives. It is the second largest dairy co- operative amongst the dairy cooperatives in the country. In South India it stands first in terms of procurement as well as sales. One of the core functions of the Federation is marketing of Milk and Milk Products. Mother Dairy, Bangalore, a Unit of KMF, is set up by NDDB on 7.12.1984. The Dairy which has expanded from 4LLPD to capacity of 7.00 LLPD has a unique nature of homogenising the milk and selling to its consumers through 50 Automatic Bulk Vending Booths, 83 Shoppees and 70 FRP tanks. The Dairy also caters Milk in sachets and Milk Products through its 289 retailers. The average sale of milk per day is 2.60 Lakh litres during the year 2008-09. The entire requirement of milk is procured from Kolar Milk Union. The Dairy produces Butter, Ghee, Curds, Ice Cream & Skim Milk Powder. The activities of all the Departments at Mother Dairy are being carried out through an on-line computer system. 2.1.4 World Bank Study – Observations: The World Bank, in its study on the effect of Co-operative dairying in Karnataka, has pointed out that: • The villages with Dairy Co-operative Societies are much better off than those without. • The families with dairy cattle are economically better than those without dairy cattle. • Women who had no control on the household income have better control in terms of Milk Money • A single commodity “MILK” has acted as a catalyst in the change in the Socio- Economic impact of the rural economy. • There is a positive impact on those at the lower end of the economic ladder both in terms of landholding and caste. H.R. Institute Of Higher Education, Hassan 12
  • 13. Performance Appraisal 2.1.5 PERSPECTIVE PLAN 2010: After the closure of OF-III project. Government of Karnataka and NDDB signed an MOU during February 2000, for further strengthening the Dairy Development Activities in Karnataka with an outlay of Rs.250 Crores. Consequent to the announcement of new lending terms and conditions by NDDB through an evolution of an action plan - Perspective 2010 to enable the dairy cooperatives to face the challenges of the increased demand for milk and milk products by focusing efforts in the four major thrust areas of Strengthening the Cooperatives. Enhancing Productivity, Managing Quality and building a National Information Network, plans are under implementation. The 4 Milk Unions viz., Dharwad, Tumkur, Bijapur and Gulbarga that were having accumulated losses were included for rehabilitation programme under the Centrally Sponsored Scheme "Assistance to Cooperatives" which is also under implementation. H.R. Institute Of Higher Education, Hassan 13
  • 14. Performance Appraisal 2.2 COMPANY PROFILE Hassan Co-operative Milk Producers' Societies Union Ltd. The Union was registered on 30th March 1977 with the operational jurisdiction extended to 3 Districts namely Hassan, Kodagu &Chikkamagalur. The Dairy was setup under the Operation Flood II & III and has a processing capacity of 1,20,000 Litres of milk per day. The Union also has a Dairy at Kudige with a capacity of 50,000 litres per day which is the first Dairy in Karnataka State started during January 1955. The Union has three Chilling Centres at Birur (20,000 LPD), Holenarasipur (20,000 LPD) and Channarayapatna (1,00,000 LPD) with total chilling capacity of 1,40,000 litres per day respectively. The Union also produces Ghee, Peda, Curds, Khova and Butter Milk. The Union procures on an average 3,86,462 litres of milk and sells 1,09,578 litres per day. There are 5 Bulk Milk Coolers & 46 Automatic Milk Collection Units in the Union. Hassan Dairy was established under the world bank aid with an initial handling capacity of 60,000 KGPD and was being managed by the then Karnataka dairy development corporation. In the year 1987 with an idea of bringing all milk allied activities such as milk procurement, milk processing and milk marketing the Hassan dairy and the Kudige dairy (the first commission dairy plant) were handed over to Hassan Co operative Milk Producers Societies Union. The integrated system of monitoring the milk procurement, processing and marketing activities by milk producers themselves was established. 2.2.1 MISSION STATEMENT: Hassan milk union aims to render the best services at normal cost to its members to increase milk production and produce good quality milk by paying remunerative price through out the year, there by improving their economic and social condition while ensuring high quality milk and milk products to the delighted level of the consumers at competitive price. H.R. Institute Of Higher Education, Hassan 14
  • 15. Performance Appraisal 2.2.2 VISION STATEMENT: The union thrives hard to adopt the modern and eco friendly technologies to produce milk and milk products of international standards to make our presence prominent in the global market. 2.2.3 AIMS AND OBJECTIVES: Hassan co operative milk producers societies union is completely an autonomous body consisting of representatives from milk producers as policy makers • To produce continuous and remunerative market for the surplus milk in the rural areas. • To supply quality milk to customers in the urban areas at a competitive price. • To provide the technical inputs necessary to produce good quality milk and to facilitate increase in milk yield. • To provide self employment to rural folk and to make them economically self sustainable by which the migration of rural folk to urban areas is minimized. • To prevent the role of the middle men in the milk business and to increase their returns. • To establish a bridge between rural and urban folk and to play a vital role in changing he social and economic status of the rural folk. H.R. Institute Of Higher Education, Hassan 15
  • 16. Performance Appraisal 2.2.4 ROLE OF DAIRY CO OPERATIVE SOCIETY: The dairy co operatives are organized in rural areas for the milk producers keeping in view the domestic principles and values. These societies educate, guide, support the milk producers in dairy development activities. 2.2.5 FUNCTIONING OF DAIRY CO OPERATIVES: The dairy co operative function all through the year in two shifts, this will provide continuous market for the surplus milk produced and the payment for the milk supplied will be distributed to the producers on the predetermined day. And provides employment to the rural folk. Input activities include: • Veterinary services like regular vaccination • Artificial insemination services • Supply of balanced cattle feed and fodder slips • Training facilities 2.2.6 GROWTH OF THE UNION The milk union which was established in the year 1977 with 100 functional dairy co operatives collecting 10,300Kgs of milk per day is procuring on an average 3,86,482 Kgs per day from 1122 co operatives as on date with the increase in milk production the Hassan dairy with the initial capacity of 60,000 KGPD was expanded to 1,20,000 KGPD during 1996. H.R. Institute Of Higher Education, Hassan 16
  • 17. Performance Appraisal 2.2.7 ACTIVITIES OF HASSAN MILK UNION: 1. Organization of dairy co operative societies: As at the end of March 2010, 1197 societies have been registered. Out of functional societies, 330 women societies are functioning. 2. Membership Enrolment: As on 30th March 2010, 1,73,396 members have been enrolled of which 71,046 are small farmer, 48,866 are marginal farmers, 22,199 are agriculture laborers and 31,285 are other farmers. 3. Milk procurement activities: The present average milk procurement from 1122 milk societies is 3,86,462 Kgs/ day at the end of March 2010. H.R. Institute Of Higher Education, Hassan 17
  • 18. Performance Appraisal 2.2.8 Product Profile Milk is marketed under Nandini brand name in different types. The pricing adopted is mainly on four categories namely: • Double Toned Milk – Rs 14/100ml • Toned Milk – Rs 16/1000ml • Standardized (homogenized) Milk – Rs 18/1000ml • Full Cream Milk – Rs 20/1000ml The main product of HAMUL is milk that is processed in number of different categories based on their fat division is H.R. Institute Of Higher Education, Hassan 18
  • 19. Performance Appraisal 2.2.9 Nandini Toned Milk: It is a pure milk and most selling milk in Karnataka. It contain 3.0% Fat And 8.5%SNF. It is available in 500 ml and 1000 ml packs. Karnataka's most favorite milk. Nandini Toned Fresh and Pure milk containing 3.0% fat and 8.5% SNF. Available in 500ml and 1ltr packs. Available in 500ml and 1ltr packs 2.2.10 Nandini Homogenized Standard Milk (Shubham): This pure milk contains 4.5% fat and 8.5% SNF. It is available in 500 ml and 1000 ml packs. This milk is rich creamier and tastier. It is ideal for preparing home mode sweets and savories. Nandini Homogenized Standard Milk Containing 4.5% Fat and 8.5% SNF.(Solid Not Fat) A rich, creamier and tastier milk, Ideal for preparing home-made sweets & savories. Available in 500ml. and 1 ltr packs. 2.2.11 Curd: H.R. Institute Of Higher Education, Hassan 19
  • 20. Performance Appraisal It is thick and delicious. It is available in 200 grams, 500 grams and 1000 grams sachet etc.The price list of Curd: At the end of April, 30,2010 Nandini Curd made from pure milk. It's thick and delicious. Giving you all the goodness of homemade curds. ‘Available in 200gms and 500gms sachet. 2.2.12 Butter Milk: Butter Milk is a refreshing health drink. It is made from quality curds and is blended with fresh green chilies, green coriander leaves, asafetida and fresh ginger. Buttermilk is packaged in 250ml packet. Nandini spiced Butter Milk is a refreshing health drink. It is made from quality curds and is blended with fresh green chilies, green coriander leaves, asafetida and fresh ginger. Nandini spiced butter promotes health and easy digestion. It is available in 200 ml packs and is priced at most competitive rates, so that it is affordable to all sections of people. 2.2.13Nandini Ghee: H.R. Institute Of Higher Education, Hassan 20
  • 21. Performance Appraisal Ghee is made from butter. It is fresh and pure with a delicious flavor. Hygienically manufactured and packed in the goodness of pure ghee. It has a got a shelf life of 6 months at ambient temperatures. It is available in 200 ml, 500 ml, 1000 ml sachet, 5 liter tins and 15 kg tins 2.2.14 Peda: Peda is very delicious made from pure milk. It can be stored for 7 days and available in 250 grams containing 10 pieces each Price list of Peda: At the end of April 30, 2010 No matter what you are celebrating! Made from pure milk, Nandini Peda is a delicious treat for the family. Store at room temperature approximately 7days. Available in 250gms pack containing 10 pieces each. 2.3 Organization structure Board of Directors- Chairman H.R. Institute Of Higher Education, Hassan 21
  • 22. Performance Appraisal Managing Director- CEO Personnel Administrati Finance (23) Procureme Marketing Purchase Assistance on (15) nt and (25) (3) Departme input (69) MIS (3) nt 2.3.1 Personnel Department: Administration Deputy Manager H.R. Institute Of Higher Education, Hassan 22
  • 23. Performance Appraisal Training/ Domestic Legal Cell Establishment (Personnel) Enquiry Administrative officer Assistant Manager Officer in charge Office superintendent Support staff It plays a crucial role in an organization which is always referred as the strength of the organization. 2.3.2 Recruitment: Recruitment is made as per the cadre strength approved by Registrar of co operatives. And the said cadre strength is within the preview of co operative act and rules. Reservation policies of the government are being followed for recruitments. Whenever Union goes for recruitment the necessary steps are being taken as per the guidelines stated in its Bye law and proper advertisement will be given in the State News H.R. Institute Of Higher Education, Hassan 23
  • 24. Performance Appraisal papers for the posts required and all the processes are made as per Govt. Norms and Suitable candidates will be called either for written test or interview or both. 2.3.3 Training: HAMUL is having training facilities for its employees at various reputed training centers and for new employees, they will be facilitated with one month on the job training at their respective areas. CTI (Central training institute), a unit of KMF, Bangalore, is one of the best training centers having its own facilities with residential facilities providing training to skilled and unskilled employees as well. Management development program to middle level management officers of the milk union on various subjects related to dairy, marketing, administration and procurement and input. In addition to this, HAMUL deputes its officers and personnel for different technical and non technical training in the following training centers: 1. SRDTC(Southern regional demonstration and training center) for both technical and non technical training. 2. Mansinh institute of training, Mahsana, Gujrat, only for technical training. 3. Vaikunt Mehta institute, Pune. For management development programmes. 4. Institute of rural management, Anand. 5. Regional institute of co operative management, BANG 6. CII- Confederation of Indian industries, institute for quality- for food industrial platforms are created. 2.3.4 Orientation programme: The new employees are given 3 to 4 days orientation training program at CTI, Bangalore, a unit of KMF. This particular training is given to the newly recruited employees irrespective of their cadre. H.R. Institute Of Higher Education, Hassan 24
  • 25. Performance Appraisal 2.3.5 Employee promotion: It is clearly stated in the cadre and strength document which is approved by registrar of co-operative societies. The employee promotion is dependent on the merit and seniority basis. It is the mandatory method followed. To decide on this, the employee education, obedience, carrying of the job and attendance are taken into consideration. 2.3.6 Record maintenance: HAMUL is having well establishment section under the administration department which maintains and updates records and other details of each employee with individual record book and file. 2.3.7 Statutory facilities: Leave: Casual leave of 15 days per year and for new entrants 1 day per month for one year is followed. Employees of the HAMUL are eligible for 30 days earned leave in each year during their service and also once in 2 year block period they will be given the option facility for surrender of leave of one month and to avail the encashment facility. The accumulation of leave days at present is restricted to 240 days. 2.3.8 HPL(Half pay leave) facilities are available. If any accident takes place during the working hours the special leave is given: • Special leave: the rabies leave is given for the infected dog bite. And also the blood donation leave for 1 day is given. H.R. Institute Of Higher Education, Hassan 25
  • 26. Performance Appraisal • Maternity leave: as per company norms • Extra-ordinary leave: depending on the service or any major health issues. 2.3.9 Conveyance Allowance: The Hassan Milk Union is providing conveyance allowance to its employees who are having two wheeler vehicles and commuter charges for those who are dependent on public transport per month is fixed. Uniform: Uniform will be provided to the employees who are working in the factory and this facility is extended to only up to the cadre of Technical Officers. Transfer: The transfer facilities are given. It is in the hands of Managing Director. If the transfer is on the request, employee is not entitled for cash benefits but if it is not on request, he is entitled for cash benefits. Retirement: The retirement age is 60 years. But on health grounds there is a consideration. And the 3 months prior notice is a must before leaving the job anytime before the retirement. Retirement benefits: A salary of 15 days per year of completed years of service, 3.5 lakh ceiling is applicable and all the gratuity announcements are according to government notifications. Provident fund is as per the government norms. 12.5% toward provident fund contribution per all the employees. Medical facilities: These facilities for self and dependents. At present each members will get reimbursement amount up to Rs 50,000 for impatient treatment H.R. Institute Of Higher Education, Hassan 26
  • 27. Performance Appraisal Canteen facilities: Good canteen facilities are provided for employees. 2.3.10 Production Department: The dairy works in 3 shifts to receive milk in the morning and evening shifts. The milk received from DCS in cans will be tested for quality and weight is recorded. The payment will be made based on the quality and the quantity. The milk received in tankers will be weighed and tested and pumped into chiller and stored in insulator storage tank. The local market needed quantity will be pasteurized and stored in insulated HMST H.R. Institute Of Higher Education, Hassan 27
  • 28. Performance Appraisal for packing toned milk, double toned milk and standardized homogenized milk. Apart from this, union also produces ghee, peda, flavored milk, curds and butter milk. The excess fat in the milk will be separated in the form of cream and issued for butter making. The cream breaks into butter and butter milk where butter is issued for ghee making and butter milk is tested for fat/COB (clout on boiling) and it will be reprocessed or will be drained out. Based on the market demand, butter is drawn for ghee production and same will be packed as per requirement. H.R. Institute Of Higher Education, Hassan 28
  • 29. Performance Appraisal Power The KPTCL supplies the power up to 325 kilo watts per month. In case of shortage in supply diesel generator is used. H.R. Institute Of Higher Education, Hassan 29
  • 30. Performance Appraisal 2.3.11 Marketing Department: Marketing should be considered as the core business function in this competitive world as it establishes, develops, and commercializes long term customer relationships and helps in meeting organizational goals. Pricing is a federal policy and KMF decides the marketing price of the milk end the milk products. KMF has adopted pricing mainly on four categories namely: • Double Toned Milk – Rs 14/100ml • Toned Milk – Rs 16/1000ml • Standardized (homogenized) Milk – Rs 18/1000ml • Full Cream Milk – Rs 20/1000ml As HAMUL is procuring 4 lakhs milk per day and its local market requirement is 1.2 lakhs kgs/day. As such the excess milk is being sent to sister unions and Interstate federations and balance if any will be sent for conversion into butter and SMP H.R. Institute Of Higher Education, Hassan 30
  • 31. Performance Appraisal Marketing structure: H.R. Institute Of Higher Education, Hassan 31
  • 32. Performance Appraisal CHANNELS OF DISTRIBUTION The network of distribution of milk was formed to be very systematic and has made distinct role in the successful marketing of milk. The processed and pasteurized milk is first packed and stored and then distributed to the target customers. Processing and manufacturing Storage Dealers or Retailers Consumer H.R. Institute Of Higher Education, Hassan 32
  • 33. Performance Appraisal 2.3.12 Procurement Department: The milk co operative societies will be organized in villages where there is excess milk production. The extention staff of the union will visit the villages and conducts the survey about the village population, animal population and the availability of the surplus milk and report to the office for consideration. The office will issue necessary instructions to organize the societies. Then the first Gramasabha meeting will be conducted and select the promoters to promote the Dairy cooperative in the village and with the permission of Registrar of Cooperative with the recommendation of Milk union the Village Chief promoter will permitted to collect the share capital and with all fulfillment of required norms then proposal will be sent to registrar of co operative department for registration. On registration, milk co operative society will be commissioned and starts procuring milk from the producers. The milk procured will be transported through trucks to near by chilling centers and dairy where milk is processed further. The society will be provided with veterinary services, AH services, feed and fader services, training and extention services. The village dairy Cooperatives will receives payments for the milk supplied to Union once in a week and the same will be distributed among its produce members every week Strength: 69 Total and day is fixed which is convenient to the concerned village. H.R. Institute Of Higher Education, Hassan 33
  • 34. Performance Appraisal 2.3.13 Stores/ Purchase Department: Purchase Purchase/stores Officer Sub staff H.R. Institute Of Higher Education, Hassan 34
  • 35. Performance Appraisal HAMUL is having a separate purchase department and purchases are made based on the requirements of various department and purchases are made as per the relation laid out. HAMUL is having a full pledged stores which supplies materials to various based on the indents or requirements and the people who are working in the stores are very well worked in inventory management. Both purchase and store departments are working under the supervision of manager dairy. The activity takes place in stores: Requisition letter: First the manager of concerned department depending upon the need for the goods sends a requisition letter to the manager dairy and then once approved the same reaches the stores in charge, the purchase section places an order. Purchase order: But for the goods regular nature depending upon the stock level , the stores in charge takes up the responsibility to place order and have the materials ready when ever required. Here in the co operative sector as per the transparency act if the goods and where the capital expenditure is involved, the enquire letters are sent the suppliers and who ever quotes the least and also with quality gets the order. And the same purchase order copy goes to 1. the supplier 2. the store in charge 3. Accounts section 4. concerned user section Purchase order also includes 1. Mode of payment after and before supply 2. Terms and conditions(taxes) 3. Delivery period 4. Mode of dispatch H.R. Institute Of Higher Education, Hassan 35
  • 36. Performance Appraisal Invoice: Against the purchase order the concerned supplier gives the invoice. Once the invoice is received the cross checking of materials as per the specifications purchase order is done. The concerned department communicated about the goods and the concerned person gives a user section remark on the quality of the product. Hence the goods received note is sent to concerned user section. 2.3.14 MIS: Management Information System Assistant Manager System Officer Support Staff H.R. Institute Of Higher Education, Hassan 36
  • 37. Performance Appraisal The main activity of the MIS department in the organization is to act as the information source for all the levels of management for the decision making in different situation. Hence to say the integration of information from all the departments for the decision making for all the two levels which exist in the organization: 1. Top level 2. Middle level The information collected from the dairy and various chilling units on on-line and information collected from Marketing on every day will be processed and send to KMF every day and also monthly procurement and input wing and the data related to artificial insemination and progress achieved in Fodder and Feeds division are collected and necessary information will be prepared and sent to various department as well will be submitted to CEO and other section heads to enable them to take necessary action and also with the help of these data MIS department will prepare the annual Targets to the Dept of Procurement and Input and Marketing. Also, All these data is given to the MIS department and the integration on monthly basis is taken up and the report as sent to the managing director and same place before the monthly meetings held of all the milk unions. H.R. Institute Of Higher Education, Hassan 37
  • 38. Performance Appraisal 2.3.15 FINANCE DEPARTMENT: Source of finance to start KMF (previously known as KDDC) and its units is from World bank channels through agreement between NDDB under Tripartite agreement between NDDB, KMF and Government of Karnataka. Now, source of funds are share capital and realization from sale proceeds of milk and milk products. As on 31.03.2010 the paid up capital was 795.29 lakhs and 206.16 lakhs loan was taken for operating. H.R. Institute Of Higher Education, Hassan 38
  • 39. Performance Appraisal 2.4 SWOT of the organization: 2.4.1 STRENGTHS: • Procurement and Input( P&I) network • Goodwill- Brand network • ISO 9001:2000 certified dairy • Ambience of Union area is most suitable for Dairying. 2.4.2 WEAKNESSES: • Advertisement execution in its early stage • Early stages of automation and computerization • Competition • Problematic distribution 2.4.3 OPPORTUNITIES: • Enter rural market • Exports-by developing tetra pack technology • Abundant area availability for milk procurement 2.4.4 THREATS: • Entry of big players • Government policies • Stringent food hygiene policies H.R. Institute Of Higher Education, Hassan 39
  • 40. Performance Appraisal 2.5 ACHIEVEMENTS: Hassan milk union is procuring milk from all the 13 taluks of three districts and selling quality milk in all the taluks and small towns. The union and all the dairy co operatives are being managed by the democratically elected boards from among the milk producers. The technical input to dairy co operatives and the dairy plants are managed by well trained, committed professionals and technical team. 91% of the milk co operative societies are operating under profit The union has successfully implemented the animal induction program for SC ST and OBC since 1996 with the financial assistance from central and state governments and rendered direct loans to the beneficiaries at lower interest rates. 254 women dairy co operatives (as on May 2009) have been organized since 1997 under support training and education program(STEP) The union has also implemented mini dairy scheme and bring entrepreneurial environment in the rural area. The union has set up Artificial insemination facilities for dairy co operatives. The union has rendered emergency veterinary services round the clock. Fertility camps are being conducted once in three months by inviting experts in the field. The union supplies quality fodder slips and seeds through the year and facilitates the availability of green fodder. The union is insuring the life of milk producers and dairy co operative staff with the co ordination from Life insurance corporation and National insurance company since 1997-1998 under “samajika suraksha yojana”. The union has launched the “YESHASHVINI” program to the milk producers wherein the milk producers are provided with the best available medical facility at free of cost. The union has successfully implemented the Total energy management program and Total quality management program (quality excellence from cow to consumer) since 2001 respectively. Quality awareness programs are being conducted regularly for school children, house wives and consumers. The union has got ISO 9001:2000 certification from TUV India, Mumbai. The union has got Energy Conservation Award. H.R. Institute Of Higher Education, Hassan 40
  • 41. Performance Appraisal 3.1 REVIEW OF LITERATURE 3.1.1 HUMAN RESOURCE MANAGEMENT The term human resources spell the total sum of all components (like skill, creative abilities) possessed by all employees and other person (like self employed, employees, owners etc.,) who contribute their services to attain the organizational objectives and goals. Human resource include human values, ethos. 3.1.2 DEFINITION: “Human resource management aims to improve the productive contribution of individuals while simultaneously attempting to attain other societal and individual employee objective”. Human resource management is concerned with the people who work in the organization to achieve the objective of the organization. It concerns with the acquisition of appropriate human resources, developing their skills and competencies, motivating them for best performance and ensuring their continued commitment to the organization to achieve organizational objectives. This definition applies to all types of organization. For e.g., industry, business, government, education, health or social welfare of the people. Human resource management refers to activities and functions designed and implemented to maximize organizational as well as employee’s effectiveness. H.R. Institute Of Higher Education, Hassan 41
  • 42. Performance Appraisal 3.1.3 Scope of human resources management: The scope of human resource management is vast. All major activities in the working life of the employees from time of his entry into the organization until he leaves, retires come under the preview of human resources management. Employees in an organization work not as individuals but as group interactions, employees come to work place and bring not only technical skills, knowledge but also their personal feelings desires, motives, attitude and values. The HR manager plays a crucial role in understanding the changing basic needs of the organization and developing to meet such changes. H.R. Institute Of Higher Education, Hassan 42
  • 43. Performance Appraisal 3.1.4 Objectives of human resources management: The primary objective of HRM is to ensure the availability of a competent and willing workforce to an organization specifically; HRM objective are four fold- societal, organizational, functional and personal.  Societal objective: To be ethically and socially responsible to the needs and challenges of the society while minimizing the negative impact of such demands upon the organization.  Organizational objective: To recognize the role of HRM in bringing about organizational effectiveness.  Functional objective: To maintain the department’s contribution at a level appropriate to the organization’s needs.  Personal objective: To assist employees in achieving their personal goals, at least in so far as these goals enhance the individual’s contribution to the organization. The other objectives of human resources management include: 1. To provide, create, utilize and motivate employees to accomplish organizational goals. H.R. Institute Of Higher Education, Hassan 43
  • 44. Performance Appraisal 2. To secure integration of individuals and groups in securing organizational effectiveness. 3. To create opportunities, to provide facilities, necessary to individuals and groups for their growth with the organization by training. 4. To provide attractive, equitable, incentives, rewards, benefits, social security measures, to ensure retention of competent employees. 5. To maintain high moral, encourage value systems and create environment of trust, mutuality of interests. 3.1.5 PERFORMANCE APPRAISAL Appraising the performance of individual, groups and organizations is a common practice of all societies. While in some instance these appraisal processes are structured and formally sanctioned, in other instances they are an informal and integral part of daily activities. Thus teachers evaluate the performance of students, bankers evaluate the performance of creditors, parents evaluate the behaviors of their children, and all of us, consciously or unconsciously evaluate our own actions from time to time. In social interactions, performance is conducted in a systematic and planned manner to achieve widespread popularity in recent years. 3.1.6 Meaning: Performance: process of performing a task or function. Appraisal: assessment/ a formal assessment of the performance. Performance appraisal is a method of evaluating the skill, efficiency, ability, knowledge, behavior etc., of employees in the work spot. Normally including both the qualitative and quantitative aspects of the job performance. Performance appraisal is the step where the H.R. Institute Of Higher Education, Hassan 44
  • 45. Performance Appraisal management finds out how effective it has been at hiring and placing employees. In other words, performance appraisal may be understood as the assessment of individual’s performance in a systematic way. The performance being measured against such factors as job knowledge, quality and quantity of output, initiative leadership abilities, supervision, dependability, co-operation, judgment, versatility, health, etc. the performance appraisal is considered to be the most significant and indispensable tool for an organization for the information provides as useful in making decisions regarding various personnel aspects such as promotions and merit increases. It is a tool for executive development is an attempt at improving an individual. Performance appraisal to do something and appraisal means to decide the values of the work done. Performance appraisal together means deciding the value of the work done by an individual. 3.1.7 Definition: According to “Flippo”, a prominent personality in the field of human resources, “performance appraisal is the systematic, periodic and an impartial rating of an employee’s excellence in the matters pertaining to his present job and his potential for a better job,” performance appraisal is a systematic way of reviewing and assessing the performance of an employee during a given period of time and planning for his future. 3.1.8 Importance of performance appraisal: Performance appraisal can achieve and contribute to the management when they are properly managed:  Assessment and analysis H.R. Institute Of Higher Education, Hassan 45
  • 46. Performance Appraisal  Appraisal and manager mutual awareness, understanding and relationship  Resolving confusion and misunderstanding.  Clarification, definition, redefining priorities and objectives.  Motivation through agreeing helpful aims and targets.  Motivation through achievements and feedback.  Training needs and learning desires-assessment and agreement.  Identification of personal strength and direct- including unused hidden strength.  Career and succession planning-personal and organizational.  Team roles clarification and team building.  Organizational training needs, employee growth and development.  Counseling and feedback. There are various ways of conducting performance appraisals, and ideas change over time as to what are the most effective appraisal methods and system. In fact performance appraisal of all types are effective if they are conducted properly, and better still if the appraisal process is clearly explained to, agreed by, the people involved well prepare and well conducted performance appraisals provide unique opportunities to help appraisee’s and managers improve and develop, and thereby also the organization for which they work. 3.1.9 Objectives of performance appraisal: The objectives of a performance appraisal may be as follows: Evaluative H.R. Institute Of Higher Education, Hassan 46
  • 47. Performance Appraisal  Compensation  Staffing  Evaluate selection system Developmental  Performance feedback  Future direction  Training needs assessment Almost all organizations practice performance appraisal in one form or another to achieve certain objectives. These objectives may vary from organization to organization or even within the same organization from time to time. It has been found that there are two primary objectives behind the use of this methodology. One is to use it an evaluation system and second, to use it as a feedback system. The aim of the evaluation system is to identify the performance gap. This means that it helps to determine the gap between the actual performance of the employees and that required or desired by the organization. The aim of the feedback system is to inform the employee about the quality of his work or performance. This is an interactive process by which the employee can also speak about his problems to his superior. An effective performance appraisal system should emphasis individual objectives, organizational objectives and also mutual objectives. From the organizational view point a performance appraisal should generate manpower information, improve efficiency and effectiveness serve as a mechanism of control and provide a rational compensation structure. In short the appraisal system establishes and upholds the principle of accountability in the absence of which organization failure is the possible outcome. H.R. Institute Of Higher Education, Hassan 47
  • 48. Performance Appraisal 3.1.10 Purpose of performance appraisal:  To create ant to maintain a level of satisfactory level of performance.  To known the performance potential.  To have good internal communication.  To contribute to the employees development and growth.  To help senior to have a proper understanding about subordinates.  To guide to job changes with the help of continuous based on performance.  To provide information for making decisions. 3.1.11 Essential characteristics of an effective appraisal system Performance appraisal system should be effective as a number of crucial decisions are made on the basis of score or rating given by the appraisers, which in turn, is heavily based on the appraisal system. An appraisal system, to be effective, should possess the following essential characteristics:  Reliability and validity  Job relatedness  Standardization  Practical viability  Legal sanction  Training to appraisers  Open communication  Employee access to results H.R. Institute Of Higher Education, Hassan 48
  • 49. Performance Appraisal 3.1.12 Who will appraise ? The appraisers may be any person who has thorough knowledge about the job content, contents to be appraised, standards of contents and who observes the employee while performing a job. The appraiser should be capable of determining what is more important and what is relatively less important. He should prepare reports and make judgments without bias. Typical appraisers are:  Supervisors  Peers  Subordinates  Self-appraisal  Users of services  Consultants Chart showing appraiser supervisors peers subordinates Users of Self- consultants services appraisal H.R. Institute Of Higher Education, Hassan 49
  • 50. Performance Appraisal When to appraise? Informal appraisals are conducted whenever the supervisor or personnel managers feel it is necessary. However systematic appraisals are conducted on a regular basis eg., for every 6 months or annually. One study of 244 firms found that appraisals were most often conducted once a year. According to another Indian study, eight organizations appraised their supervisory personnel at their anniversary date of joining. Research has also indicated that appraisals for development purpose should be separated from those for salary administration. 3.1.13 Problems with performance appraisal The problems inherent in performance appraisal may be listed thus:  Judgment errors  poor appraisal forms  Lack of rater preparedness  Ineffective organizational policies and practices Judgment errors: people commit mistakes while evaluating people and their performance. Biases and judgment errors of various kinds may spoil the show. Bias here refers to inaccurate distortion of a measurement. A few of them are: • first impressions (primary effect) • halo • horn effect • leniency • central tendency H.R. Institute Of Higher Education, Hassan 50
  • 51. Performance Appraisal • stereotyping • regency effect. Lack of rater preparedness: the raters may not be adequately trained to carry out performance management activities. This becomes a serious limitation when the technical competence of a ratee is going to be evaluated by a rater who has limited functional specialization in that area. Ineffective organizational policies and practices: if the sincere appraisal effort put in by a rater is not suitably rewarded, the motivation to do the job thoroughly finishes off. Sometimes, no rating given by raters are viewed negatively by management-as a sign of failure on the part of rater or as an indication of employee discontent poor appraisal forms: the appraisal process might also be influenced by the following factors relating to the forms that are used by raters  The rating scale may be quite vague and unclear.  The rating firm may ignore important aspects of job performance.  The rating firm may contain additional, irrelevant performance dimensions.  The forms may be too long and complex. 3.1.14 Key factor of Appraisal System The performance appraisal system should:  Be correlated with the organizational mission, philosophies and value system; H.R. Institute Of Higher Education, Hassan 51
  • 52. Performance Appraisal  Cover assessment of performance as well as potential for development;  Take care of organizational as well as individual needs; and  Help in creating a clean environment. Problem areas of performance appraisal  Recent performance most influential  Focus on outstanding events  Personal feelings - halo effect  Lack of yardsticks  Rater attitudes  Leniency/stringency error  Similar-to-me error  Central tendency error  First impression error  Racial bias  Focus on longevity  Complacency of managers Avoiding Appraisal Problems Evaluating individual job performance as a basis for making objective personnel decisions. Making Performance Appraisals Legally Defensible 1. Use job analysis to develop the appraisal system. 2. Check that the appraisal system is behavior-oriented, not trait-oriented. H.R. Institute Of Higher Education, Hassan 52
  • 53. Performance Appraisal 3. Have evaluators follow specific written instructions when conducting appraisals. 4. Have evaluators review results with the rates. 3.1.15 Performance appraisal contents of an officer  Attendance  Puntuality  Expression-writtten & oral  Presentation skills  Job knowledge  Knowledge of related jobs  Ability to get along with others  Technical knowledge/ skills  Reasoning ability  Application of mind  Ability to work under stress  Integrity  Honesty and sincerity  Thoroughness/perfection  House keeping/cleanliness  Quality  Cost conciousness  Managerial prudence  Continous improvement plans H.R. Institute Of Higher Education, Hassan 53
  • 54. Performance Appraisal  Analytical approach  Leadership styles  Initiataive and risk taking  Judgement skills  Ability to assume additional responsibilty  Acceptance by subordinates  Internal customer servicing  Ability to think strategically  Sociability  Profesional relatd activities. Effective performance appraisal: Apart from traditional performance appraisals, there are many different methods of performance evaluation. The use of these methods depends on the purpose of the evaluation, the individual, and the environment. The performance appraisals generally the over-riding instrument, which gathers together and review all other performance data. What is to be appraised? Content appraised may be in the form of contribution to the organization objectives like productive, cost saving, return on capital etc. The content appraised are-  Regularity of attendance H.R. Institute Of Higher Education, Hassan 54
  • 55. Performance Appraisal  Self-expression: written or oral  Ability to work with others  Leadership style and abilities  Technical skill.  Technical ability and knowledge.  Ability to grasp new things.  Creative skills  Area of interest.  Judgment skill  Capability of thinking responsibility.  Level of acceptance by subordinates  Honesty and sincerity  Thoroughness in job and organizational knowledge  Knowledge of system and procedures  Quality of the suggestions offered for improvement etc. 3.1.16 Methods of performance appraisal: Apart from formal traditional performance appraisal, there are many different method of performance evaluation. The use of these method depends on the purpose of the evaluation the individual, the assessor, and the environment. The performance appraisal is H.R. Institute Of Higher Education, Hassan 55
  • 56. Performance Appraisal generally the over- riding instrument, which gather together and reviews all other performance data. Performance appraisal methods Individual evaluation Multiple-person Other methods methods appraisal methods * Group appraisal * Confidential report * Ranking * HRA * Essay evaluation * Paired comparison * Assessment centre * Critical incidents * Forced distribution * Field review * Checklists * Graphic rating scale * Behaviorally anchored rating scales * Forced choice method * MBO H.R. Institute Of Higher Education, Hassan 56
  • 57. Performance Appraisal Appraisal method:  Confidential report.  Graphical rating scales.  Ranking method.  Paired comparison method.  Forced distribution method.  Checklist method.  Simple checklist.  Weighted checklist.  Forced choice.  Critical incident method.  Essay or free from appraisal  Group appraisal  Behaviorally anchored rating scales.  Assessment centre.  Human resource accounting  Management by objectives (also known as appraisal by objectives) H.R. Institute Of Higher Education, Hassan 57
  • 58. Performance Appraisal 3.1.17 Appraisal process: 1. Establish performance standards. 2. Communicate performance expectations to employees. 3. Measure actual performance. 4. Compare actual performance with standard. 5. Discuss the appraisal with the employee. 6. If necessary, initiate corrective action. Chart showing performance appraisal process H.R. Institute Of Higher Education, Hassan 58
  • 59. Performance Appraisal Establish 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 degree 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. H.R. Institute Of Higher Education, Hassan 59
  • 60. Performance Appraisal Communicate 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 them. 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 sis a continuous process which involves monitoring the performance throughout the year. This stage requires the careful selection of the 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 performance 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 employees’ performance. 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 H.R. Institute Of Higher Education, Hassan 60
  • 61. Performance Appraisal results, the problem 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 problem faced and motivate the employees to perform better. Decision making: The last step of the process is to be take decisions which can be taken either to improve the performance of the employees, take the required corrective actions, or the related HR decisions like rewards, promotions, demotions, transfers etc 3.1.18 Uses of performance appraisal The following uses of a performance appraisal  Performance improvement  Compensation adjustment  Placement decisions  Training and development needs assessment  Career planning  Job design error detection  Detection of external factors influencing job performance  Performance deficiencies may be due to family or other pressures. H.R. Institute Of Higher Education, Hassan 61
  • 62. Performance Appraisal Why performance appraisals fail: A. Guilt many supervisors feel uncomfortable in making judgments about the performance of others. B. Lack of accountability managers often go through the motions of performance appraisal without giving any real thought to the process because they are not held accountable for the accuracy of the appraisals. C. Ineffective application of standards overrating often results when supervisors do not have a good grasp of the standards being applied. D. Fear of hurt feelings some supervisors would rather give everyone a high rating than risk “hurting someone’s feelings” by pointing out performance deficiencies. H.R. Institute Of Higher Education, Hassan 62
  • 63. Performance Appraisal EXISTING PERFORMANCE APPRAISAL IN HCMPSUL, HASSAN 3.1.19 PRESENT PERFORMANCE APPRAISAL SYSTEMS IN HCMPSUL, HASSAN HCMPSUL has adopted a confidential report (systematic) performance appraisal in its workforce. The performance of employees is reviewed annually. The performance appraisal report is sent to each department. The divisional head will analysis performance if the employees who come under hisher control in that year against in each agreed and assigned area and employees personal contribution. The appraisee also mentions the tasks that could not be completed and the reasons therefore. The constraints faced and the suggestions for improvement like training, job rotation, job enlargement, job enrichment etc., He will also mentions the training and development programs that he has undergone during the past 3 years, training and developmental needs that he needs the reviewing employees later screen and self appraisal repot submitted by appraise. The employee evaluates the appraisal based on various potential factors. This evaluation is done by divisional head. The divisional head will go through the evaluation made by reviewing employees against each potential factor. The divisional head makes the overall assessment taking into consideration the job performance and other relevant factors like job knowledge, creativity, planning, H.R. Institute Of Higher Education, Hassan 63
  • 64. Performance Appraisal organizing, decision making, achievement of targets, promptness and punctuality, quality of work, personnel skills, interpersonal relations, training and development of subordinates, leadership ability etc., There are four parameter divisional head judge employees-best, good, satisfactory, least (not up to the mark). Divisonal head has to give explanation why he has rated least to an employee in the case least rate was given. Further the employee also gets a chance to explain rating against least rating. If the explanation is satisfactory then it is acceptable. Divisional head need not give any explanation to other parameters. Divisonal head, appraises job performance and other relevant factors are overall assessed. The employee’s integrity is also assessed. If his job performance along with others potential factors is excellent and his integrity is faultless. The reporting and reviewing officers will suggest this employee id fit for promotion/ increment in written format. Later these formats are sent to managing Director for further necessary actions. Confidential Report (Theory) It is mostly used in government organizations. It is a descriptive report prepared, generally at the end of every year, by the employee’s immediate superior. The report highlights the strengths and weakness of the subordinates. The report is not data based. The impressions of the superior about the subordinates arte merely recorded there. It does not offer any feed back to the appraisee. The appraisee is not very sure about why his rating has fallen despite his best effort, why others are rated high when compared to him, how to rectify his mistake, if any: on what basis he is going to be evaluated next year etc. Since the report is generally not made public and hence no feedback is available, the subjective analysis of the superior is likely to be hotly contested. In the recent years, due to pressure from court and trade unions, the details of the negative confidential report are given to the appraisee. H.R. Institute Of Higher Education, Hassan 64
  • 65. Performance Appraisal H.R. Institute Of Higher Education, Hassan 65
  • 66. Performance Appraisal 4. ANALYSIS AND INTERPRETATION There are approximately say 410 employees working in HCMPSU, out of which 50 non executives are taken as sample size for the survey. A questionnaire consisting of 15 questions were distributed to them. The analysis and interpretation are as follows: 4.1 Awareness about the current appraisal system Degree No. of Percentage (%) respondents Strongly agree 20 40 Agree 17 34 Disagree 9 18 Strongly disagree 4 8 Total 50 100% Interpretation Majority of the respondents (74%) are aware of the current performance appraisal system. Among them half of the employees (40%) strongly agree that they are well aware of the current performance appraisal system. (34%) respondents agree that they are somewhat aware of the current performance appraisal system, whereas (8%) respondents are not at all aware of the current performance appraisal system. The graph shows the relative percentage of the response of the employees. H.R. Institute Of Higher Education, Hassan 66
  • 67. Performance Appraisal 4.2 Performance Appraisal is very important to improve one’s Degree No. of respondents Percentage (%) Strongly agree 28 56 Agree 17 34 Disagree 5 10 Strongly disagree 0 0 Total 50 100% Interpretation Almost all the employees said that the performance appraisal is important to improve one’s performance (90% ) Respondents strongly agreed with this statement, but other respondents nearly (10%) of them disagreed to the statement. The graph shows the relative percentage of the response of the employees. 4.3 Performance appraisal system provides adequate feedback H.R. Institute Of Higher Education, Hassan 67
  • 68. Performance Appraisal Degree No. of Percentage respondents (%) Strongly agree 30 60 Agree 12 24 Disagree 6 12 Strongly 2 4 disagree Total 50 100% Interpretation Majority of the respondents (60%) agree that performance appraisal system provides adequate feedback while only (12%) of the respondents does not agree to this. The graph shows the relative percentage of the response of the employees. 4.4 Performance appraisal is a way to discuss one’s progress openly, honestly and motivate employees to perform better H.R. Institute Of Higher Education, Hassan 68
  • 69. Performance Appraisal Degree No. of Percentage respondents (%) Strongly 26 52 agree Agree 22 44 Disagree 2 4 Strongly 0 0 disagree Total 50 100% Interpretation Nearly half of the employees(52%) said that performance appraisal is a way to discuss one’s progress to perform better, while only (4%) of the employees do not agree to this. The graph shows the relative percentage of the response of the employees. 4.5 Performance appraisal helps to integrate individual and organizational goal Degree No. of Percentage H.R. Institute Of Higher Education, Hassan 69
  • 70. Performance Appraisal respondents (%) Strongly agree 29 58 Agree 12 24 Disagree 6 12 Strongly 3 6 disagree Total 50 100% Interpretation More than (58%) of employees agree that performance appraisal helps to integrate the individual and organizational goals, except for (12%) who do not agree that the performance appraisal helps to integrate the individual and organizational goals. The graph shows the relative percentage of the response of the employees. 4.6 Personal relationships, likes, dislikes etc influence performance appraisal ratings Degree No. of Percentage respondents (%) Strongly agree 2 4 Agree 5 10 Disagree 11 22 Strongly 32 64 H.R. Institute Of Higher Education, Hassan 70
  • 71. Performance Appraisal disagree Total 50 100% Interpretation Form the above we can analyze that while (14%) of the employees agree that performance appraisal is influenced by personal influences, (64%) of the employees believe that it depends only on performance. The graph shows the relative percentage of the response 4.7 Performance appraisal helps to win co-operation and team work. Degree No. of Percentage respondents (%) Strongly 18 36 agree Agree 29 58 Disagree 3 6 Strongly 0 0 H.R. Institute Of Higher Education, Hassan 71
  • 72. Performance Appraisal agree Total 50 100% Interpretation It is evident from the responses of the employees that nearly (58%) of the employees strongly agree that performance appraisal helps in gaining co-operation and leads to team work while (6%) of the employees disagree to this. The graph shows the relative performance of the response of the employees 4.8 Evaluation of the team performance should be included in performance appraisal Degree No. of Percentage(%) respondents Strongly 12 24 agree Agree 26 52 Disagree 10 20 Strongly 2 4 agree Total 50 100% Interpretation H.R. Institute Of Higher Education, Hassan 72
  • 73. Performance Appraisal Out of 50 sample employees majority of the respondents (52%) employees said that the team performance appraisal should be included in performance only (20%) of the employees do not agree that team performance should be included for the evaluation. The graph shows the relative response of the employees. 4.9 Peers, customers, subordinates, other departmental representatives should be included in performance appraisal process Degree No. of Percentage respondents (%) Strongly agree 1 2 Agree 3 6 Disagree 12 24 Strongly 34 68 disagree Total 50 100% Interpretation From the above we can analyze that while (8%) of the employees agree that Peers, customers, sub ordinates other departmental representatives should be included in the H.R. Institute Of Higher Education, Hassan 73
  • 74. Performance Appraisal performance appraisal, (68%) of the employees strongly disagree to this and believe only management should be included in the process. The graph shows the relative performance of the response of the employee 4.10Performance appraisal system helps to identify the strengths and weakness of the employee Degree No. of Percentage(%) respondents Strongly agree 16 32 Agree 23 46 Disagree 11 22 Strongly 0 0 disagree Total 50 100% Interpretation More than (46%) of employees agree that performance appraisal helps to identify the individual strengths and weakness except for (22%) who do not agree. H.R. Institute Of Higher Education, Hassan 74
  • 75. Performance Appraisal The graph shows the relative performance of the response of the employees 4.11 Performance rating is helpful for the management to provide employee counseling. Degree No. of Percentage respondents (%) Strongly agree 9 18 Agree 25 50 Disagree 13 26 Strongly 3 6 disagree Total 50 100% Interpretation Nearly half of the employees(50%) said that performance appraisal is helpful for the management to provide employee counseling, while only (26%) of the employees do not agree to this. H.R. Institute Of Higher Education, Hassan 75
  • 76. Performance Appraisal The graph shows the relative performance of the response of the employees. 4.12 Appraisal system keeps on the major achievement and failure or success of the work Degree No. of Percentage respondents (%) Strongly agree 2 4 Agree 26 52 Disagree 20 40 Strongly 2 4 disagree Total 50 100% Interpretation From the above we can analyze that while (52%) of the employees agree that appraisal system keeps on the major achievement and failure or success of the work,(40%) of the employees disagree to this. H.R. Institute Of Higher Education, Hassan 76
  • 77. Performance Appraisal The graph shows the relative performance of the response of the employees. 4.13 Transfer, demotion, suspension and dismissal is based on performance appraisal Degree No. of Percentage respondents (%) Strongly agree 12 24 Agree 27 54 Disagree 6 12 Strongly 5 10 disagree Total 50 100% Interpretation It is evident from the responses of the employees that nearly (54%) of the employees agree that transfer, demotion, suspension and dismissal is based on performance appraisal while (12%) of the employees disagree to this. H.R. Institute Of Higher Education, Hassan 77
  • 78. Performance Appraisal The graph shows the relative performance of the response of the employees. 4.14 Management fixes salary through the performance rating Degree No. of Percentage(%) respondents Strongly agree 3 6 Agree 33 66 Disagree 9 18 Strongly 5 10 disagree Total 50 100% Interpretation Nearly half of the employees (66%) said that management fixes the salary based on the performance rating, while only (10%) of the employees do not agree to this. H.R. Institute Of Higher Education, Hassan 78
  • 79. Performance Appraisal The graph shows the relative performance of the response of the employees. 4.15 The performance appraisal is helpful in reducing grievance among the employees Degree No. of Percentage respondents (%) Strongly agree 10 20 Agree 32 64 Disagree 8 16 Strongly 0 0 disagree Total 50 100% Interpretation More than (64%) of employees agree that performance appraisal helps to reduce the grievances of the employees, except for (16%) who do not agree. H.R. Institute Of Higher Education, Hassan 79
  • 80. Performance Appraisal The graph shows the relative performance of the response of the employees. H.R. Institute Of Higher Education, Hassan 80
  • 81. Performance Appraisal 4.16 Performance appraisal increases employees’ motivation Degree No. of respondents Percentage (%) Strongly agree 12 24 Agree 27 54 Disagree 8 16 Strongly disagree 3 6 Total 50 100% Interpretation From the above we can analyze that while (54%) of the employees agree that performance appraisal helps in increases the employees motivation, only (6%) of the employees disagree to this. The graph shows the relative performance of the response of the employees. H.R. Institute Of Higher Education, Hassan 81
  • 82. Performance Appraisal 4.17 The follow up procedures after performance appraisal is satisfactory Degree No. of Percentage respondents (%) Strongly agree 16 32 Agree 33 66 Disagree 1 2 Strongly 0 0 disagree Total 50 100% Interpretation Out of 50 sample employees majority of the respondents (66%) employees said that the fallow up system in the performance appraisal system is satisfactory, only (2%) of the employees disagree to this. The graph shows the relative performance of the response of the employees H.R. Institute Of Higher Education, Hassan 82
  • 83. Performance Appraisal FINDINGS 1. Majority of the employees are aware of the performance appraisal system. 2. The performance appraisal system followed by the organization is very effective as majority of the employees are satisfied and have given positive responses. 3. It has been evident from the responses of the employees that the system followed in the organization has helped them in identifying their strengths and weakness as (46%) of the employees have strongly agreed in their responses. 4. Performance appraisal system followed in HCMPSUL has motivated employees to perform better. 5. More than half of the respondents are aware of the importance of performance appraisal system in improving one’s performance. 6. The follow up system in HCMPSUL is very effective as more than half of the employees are satisfied. 7. The system adopted in the HCMPSUL has helped the employees to integrate individual goals with that the organization and hence lead them to perform better. 8. The performance appraisal system followed by HCMPAUL has been successful in finding out the weaker parts of their employees and has been successful in reducing their grievances. 9. The system has definitely motivated employees to co operate and work in team. H.R. Institute Of Higher Education, Hassan 83
  • 84. Performance Appraisal SUGGESTIONS 1. Performance Appraisal reports must be based on SWOT techniques and provide scope for further career development in the organization. 2. The performance appraisal report must be done genuinely and should not be based on biased. 3. For better results 360 degree system of evaluation can also be adopted by the organization 4. Performance of the employees should be evaluated taking all the aspects into consideration and should not be restricted to only one criteria. 5. Performance appraisal is not a one time affair, for better results the organization should do the appraisals in frequent intervals. 6. Rating employees based on personal preferences, likes, dislikes must be avoided so that employees gain confidence on the system of appraisal and are motivated to work hard and provide results. H.R. Institute Of Higher Education, Hassan 84
  • 85. Performance Appraisal H.R. Institute Of Higher Education, Hassan 85
  • 86. Performance Appraisal CONCLUSION All the results observed and achieved during the project clearly indicate the importance and need of performance appraisal in the organsation. The study reveals that the employees perform their duties well and performance appraisal continuously, motivate the employees to achieve their goals indirectly helping the organization to achieve its goals. Employees should be praised in public and correct in Private Government organizations follow traditional methods like Confidential Report Method, where a superior evaluates an employee on basis of loyalty, intelligence, character and his work. But this type of method is often biased, resulting in dissatisfaction and misunderstandings among employees which hamper their productivity. People differ in their abilities and their aptitudes. There is always some difference between the quality and quantity if the same work on the same job is done by the different people. Therefore, performance management and performance appraisal is 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. In present scenario, it is impossible for the organization to manage challenges without the help of potential human resource. Hence, the employee’s in the organization become the biggest assets to be taken care of, Employees ability and inability, strengths and weakness etc has to be evaluated and appraised periodically. Performance appraisal is one such management tool which gives unbiased answers to management questions. Finally, I would like to conclude by saying that this project work has given immense knowledge about the functioning of Government Organizations. It’s a great advantage to have good insight about such companies before the end of the course. My suggestions were duly honored by the management. This has satisfied me to a greater extent and at the same time I am motivated to carry out such projects in future which would enhance my career and the organization as well. H.R. Institute Of Higher Education, Hassan 86
  • 87. Performance Appraisal BIBILOGRAPHY AND REFERENCES • V.S.P Rao, Human Resources Management, 2nd edition, Excel books, Page number 335-387 • K. Aswathappa, Human resources Management, 5th edition, Mc.Graw. Hill co’s, Page number 238-282 • P.Subba Rao, Human resources Management, 5th edition, Himalaya house publishing, Page number 231-256 • JW Smither, Performance Appraisal,7th edition, Mc.Graw. Hill co’s, Page number 187-210 • T.V Rao, Appraising & Development Of Managerial Performance,4th edition, Page number 144-154 • http://www.kmfnandini.coop/html/unions-hassan.htm • wikimapia.org/13619791/KMF-Hassan • www.kmfnandini.coop/html/unions-bangalore.htm - • Company employees and management • www.performanceappraisal.org H.R. Institute Of Higher Education, Hassan 87
  • 88. Performance Appraisal QUESTIONNAIRE Dear Sir/Madam I am Prashanth. N student of final semester MBA (HR) studying at HR institute of higher education, University if Mysore. As part of the academic curriculum, I am carrying out a project work in Hassan Co-Operative Milk Producers Society Union Ltd (HCMPSUL), Hassan. In this regard a questionnaire has been provided to you, please express your fair view for the questions asked in the questionnaire. I therefore, invite your frank opinion on the below mentioned questions. The outcome of the project will serve academic interest only. Thanking You, Prashanth. N SECTION-A 1. Name: 2. Age: 3. Sex: (A) Male ( ) (B) Female ( ) 4. Designation: 5. Performance appraisal is very important to improve one’s performance (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 6. Performance appraisal system provides adequate feedback (A) Strongly agree ( ) (B) Agree ( ) H.R. Institute Of Higher Education, Hassan 88
  • 89. Performance Appraisal (C) Disagree ( ) (D) Strongly Disagree ( ) 7.Performance appraisal is a way to discuss one’s progress openly, honestly, and motivte employees to perform better. (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 8. Performance appraisal helps to integrate individual and organizational goals (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 9. Personal relationship, likes, dislikes etc influence performance appraisal ratings (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 10. Performance appraisal helps to win co-operation and team work (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 11. Evaluation of team performance should be included in performance appraisal (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 12. Peers, Customers, subordinates, other departmental representatives should be included in performance appraisal process H.R. Institute Of Higher Education, Hassan 89
  • 90. Performance Appraisal (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 13. Performance appraisal system helps to identify the strengths and weakness of the employee (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 14. Performance rating is helpful for the management to provide employee counseling (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 15. Appraisal system keeps on the major achievement and failure or success if the work (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 16. Transfer, demotion, suspension and dismissal is based on performance appraisal (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 17. Management fixes salary through the performance rating (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) H.R. Institute Of Higher Education, Hassan 90
  • 91. Performance Appraisal 18. The performance appraisal is helpful in reducing grievance among the employees (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 19. Performance appraisal increases employee motivation (A) Strongly agree ( ) (B) Agree ( ) (C) Disagree ( ) (D) Strongly Disagree ( ) 20. The follow up procedure after performance appraisal is satisfactory (A) Strongly agree ( ) (B) Agree ( ) s(C) Disagree ( ) (D) Strongly Disagree ( ) H.R. Institute Of Higher Education, Hassan 91