Internship report on Performance Appraisal in BMW

1. INTRODUCTION

1.1 PERFORMANCE APPRAISAL


       Performance appraisal is the process of obtaining, analyzing and recording
information about the relative worth of an employee. The focus of the performance appraisal
is measuring and improving the actual performance of the employee and also the future
potential of the employee. Its aim is to measure what an employee does.


       It is a powerful tool to calibrate, refine and reward the performance of the employee.
It helps to analyze his achievements and evaluate his contribution towards the achievements
of the overall organizational goals. By focusing the attention on performance, performance
appraisal goes to the heart of personnel management and reflects the management's interest
in the progress of the employees.


       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. 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.
Performance appraisal takes into account the past performance of the employees and focuses
on the improvement of the future performance of the employees.

       1.1.1 OBJECTIVES OF PERFORMANCE APPRAISAL:

   • To review the performance of the employees over a given period of time.
   • To judge the gap between the actual and the desired performance.
   • To help the management in exercising organizational control.

                                             1
• Helps to strengthen t h e relationship and communication between supervisor-
       subordinates and management-employees.
   • To diagnose the strengths and weaknesses of the individuals so as to identify t h e
       training and development needs of the future.
   • To provide feedback to the employees regarding their past performance. Provide
       information to assist in the other personal decisions in the organization.
   • Provide clarity of the expectations and responsibilities of the functions to be
       performed by the employees.
   • To judge the effectiveness of the other human resource functions of the organization
       such as recruitment, selection, training and development.
   • To reduce the grievances of the employees.

       If employee development is required for performance improvement then solving
these performance problems should be straight forward with a clear understanding of root
causes. Possible approaches include changing the work environment, better prioritization of
conflicting priorities, time off, additional training, shadow or buddy system, mentoring or
coaching, changing team environment or set objectives and soon.

1.2 INDUSTRY PROFILE

       1.2.1 HISTORY

       The first practical automobile with a Petrol engine was built by Karl Benzin, 1885 in
Mannheim, Germany. Benz was granted a patent for his automobile on 29 January 1886, and
began the first production of automobiles in 1888 after Bertha Benz his wife had proved with
the first long-distance trip in August 1888 from Mannheim to Pforzheim and back that the
horseless coach was absolutely suitable for daily use. Since 2008 a Bertha Benz Memorial
Route commemorates this event.

       Soon after, Gottlieb Daimler and Wilhelm Mabuchi in Stuttgart in 1889 designed a
vehicle from scratch to be an automobile, rather than a horse-drawn carriage fitted with an
engine. They are also usually credited as inventors of the first motorcycle in 1886, but Enrico
Bernardio of the University of Padua in 1882, patented a 0.024 horsepower one-cylinder
                                              2
petrol motor fitting into his son’s tricycle making it at least a candidate for the first
automobile, and first motorcycle. Bernardi enlarged the tricycle in 1892 to carry two adults.

       1.2.2 AUTOMOTIVE INDUSTRY

       The automotive industry designs, develops, manufacturers, markets, and sells the
world’s motor vehicles. In 2009, more than 88 million motor vehicles, including cars and
commercial vehicles were produced worldwide.

       In 2009-2010, a total of 90 million new automobiles were sold worldwide: 24 million
in Europe, 21.4 million in Asia-Pacific, 19.4 million in USA and Canada, 14.4 million in
Latin America, 6.4 million the Middle East and 7.4 million in Africa. The markets in North
America and Japan were stagnant, while those in South America and Asia grew strongly. Of
the major markets, Russia, Brazil, India and China saw the most rapid growth.

       About 250 million vehicles are in the use in the United States. Around the world,
there were about 806 million cars and light trucks on the road in 2009: they burn over 260
billion gallons of gasoline and diesel fuel yearly. The numbers are increasing rapidly,
especially in China and India. In the opinion of some, urban transport systems based around
the car have proved unsustainable, consuming excessive energy, affecting the health of
populations, and delivering a declining level of service despite increasing investments. Many
of these negative impacts fall disproportionately on those social groups who are also least
likely to own and drive cars. The sustainable transport movement focuses on solutions to
these problems.

       In 2009, with rapidly rising oil prices, industries such as the automotive industry, are
experiencing combination of pricing pressures from raw material costs and changes in
consumer buying habits. The industry is also facing increasing external competition from the
public transport sector, as consumers re-evaluate the private vehicle usage. Roughly half of
the US’s fifty one light vehicle plants are projected to permanently close in the coming years
with the loss of another 200,000 jobs in the sector, on top of the 560,000 jobs lost this
decade. As a result, in 2010, China became the largest automobile markets in the world.

                                              3
1.3 INTRODUCTION OF THE COMPANY

       BMW is an acronym for Bayerische Motoren Werke AG--or, in English, Bavarian
Motor Works. Whatever you call it, the German-based company is one of the world's most
respected automakers, renowned for crafting luxury cars and SUVs that offer superior levels
of driving enjoyment. Founded in Munich, the company began in the early 1910s as an
aircraft manufacturer. BMW's current logo, designed to represent white propeller blades
against a blue sky, reflects these origins; its blue-and-white color scheme also references
Bavaria's blue-and-white checkered flag. It wasn't until 1928 that production began on the
first BMW automobile, the Dixi. The car proved tremendously popular, and its success
helped the manufacturer weather the Depression. BMW's best-known pre-World War II
vehicle was the Type 328 roadster, a supple two-seater that racked up over 120 victories on
the motorsport circuit between 1936 and 1940.

       Postwar BMW cars maintained this tradition, winning several racing, rallying and hill
climb victories. The early 1950s saw the launch of the BMW 501, a roomy, voluptuous sedan
that was M resplendent with all of the hopefulness of that era. It was soon followed by the
502 which was powered by the world's first light-alloy V8, foreshadowing BMW's ongoing
commitment to developing new technology. The best-selling BMW of that decade was the
Isetta, a petite two-seat "micro car" typically powered by a 12- or 13-horsepower engine. The
mid-'50s also saw the debut of the limited production and breathtakingly beautiful 507 sports
car which had an alloy body and used the 502's V8 for propulsion. In the 1960s, BMW sales
strengthened significantly, thanks in part to the immense popularity of the 1500, a sporty
family sedan. By the 1970s, BMW was establishing itself as a full-fledged car company. It
was a pioneer for many emerging technologies, including turbo charging and advanced
vehicle electronics. This was also the period when BMW of North America was established
and consumers, who coveted both sports and luxury cars, became loyal "Bimmer" owners.
The '70salso saw the birth of BMW's three-tier sport sedan range consisting of the 3 Series, 5
Series and7 Series cars and the creation of its performance division. More recently, the
company has been expanding its reach worldwide. It opened its first U.S. manufacturing
plant in the latter half of the 1990s and has expanded its brand empire to include Mini and


                                              4
Rolls-Royce. BMW also continues to build motorcycles, something it has done since the
1920s.

         The automaker's famous advertising slogan describes each of its vehicles as "the
ultimate driving machine," and it's not mere hyperbole. Over the past couple of decades,
BMWs have become the standard for performance and luxury in most of the "over $30,000"
segments. With family-friendly wagons, crisp sedans, distinctive coupes, nimble sports cars
and spacious SUVs offered, BMW's model roster is diverse. But its luxury vehicles all share
a common characteristic: the ability to make drivers feel gloriously connected to the road.

         1.3.1 ORGANIZATION CHART



                                                          TN-436
                                                      General Manager
                                                     Human Resources
                                                 Subash Chander Ganapathy


                                                                               TN-436
                                                                            Team Assistant
                                                                                Bavya


              TN-436                                                                 TN-436
             Manager                                                                Specialist
         Human Resources                                                     EMS, Facilities and Project
          R. Govardhanan                                                        M.Ramakrishnan


                     TN-436                                                                 TN-436
                 Specialist Safety                                                   Facilities & Projects
                     Sathish                                                                Naresh


                            TN-436
                 Recruitment , Trainng and PMS                                             TN-436
                            Saranya                                                       Facilities
                                                                                      Balasubramaniyan


                        TN-436
                    Employee Relation                                                   TN-436
                     Shanmugarajan                                                      Projects
                                                                                      Damodharan


                   TN-436
                    Expat
                   Marrion


                            TN-436
                   Employee Relation (EWH &
                       Other Functions)
                         Balakrishnan

                                                        5
1.3.2 VARIOUS DEPARTMENTS

ASSEMBLY

       Starting from car body delivery from logistics to completion of entire car comes
under this department. It consists of process of assembling car parts. This includes various
sub-departments like Overhead, Door, Paint Shop, Final Flash, Finish Rework, Repair
On Wheels and Trimline.

PLANT MANAGEMENT

       This is the finance department of the company which sources and allocates the funds
for continuous production. All necessary goods for employees are purchased through this
department. They provide the sales and expenditure details.

HUMAN RESOURCE AND FACILITY

       This department serves as the bridge between the management and workforce.
Various tasks like filing of employee records, payroll distribution, tax filing, attendance,
assigning loss of pay etc. Facility department takes care of the plant maintenance. It includes
infrastructure facility like housekeeping, gardening, waste management and security etc.

INFORMATION TECHNOLOGY DEPARTMENT

       This department takes care of network and communication facility of company. It
controls the inflow and outflow of data from company and outside world through computers
and internet security.

1.4 INTRODUCTION OF THE SUBJECT

       Performance appraisal may be defined as an organized formal interaction between a
subordinate and supervisor, that usually takes the form of a periodic interview, in which the
work performance of the subordinate is examined and discussed, for identifying weaknesses
and strengths as well as opportunities for improvement and skills development (Archer

                                              6
North, 2002). In other words, Performance appraisal is a formal system of measuring,
evaluating, and influencing an employee’s job-related attributes, behaviors and outcomes to
determine how productive an employee is, and to determine if an employee’s productivity
can be improved (Konobear, 2002).

       Appraisal results are used in many organizations, either directly or indirectly, to help
identifying the better performing employees who should get the majority of available merit
pay increases, bonuses, and promotions. There are various appraisal methods are in usage
today. Broadly, we can classify them as comparative appraisals (ranking, paired
comparisons, and forced distribution), behavioral appraisals (graphic rating scales,
checklist, critical incidents, essays, and behaviorally anchored rating scales), and output
based appraisals. Also there are rapid appraisal methods for quick, low cost ways to gather
data for manager’s information needs.

       All of the appraisal methods have been discussed and their advantages and
disadvantages are mentioned. In this paper a new appraisal method has been proposed using
the existing methods. This new method is developed by taking the advantages of the three
common methods including comparative, behavioral and output based. The advantages and
disadvantages of this new method are also discussed. A hierarchical structure discussed in
this paper uses all the appraisal methods accordingly at appropriate levels of the company.

       1.4.1 METHODS FOR APPRAISING PERFORMANCE

       Performance actually can be appraised by a wide variety of methods and techniques.
The most commonly used performance appraisal methods can be distinguished into three
major categories: comparative appraisals, behavioral appraisals, and output-based appraisals.

       1.4.1.1 Comparative Appraisals

       Managers directly compare the performance of their subordinates against one another
in comparative appraisals. For example, a data entry operator's performance would be
compared with that of other data-entry operators by the computing supervisor. Comparative
techniques include ranking, paired comparisons, and forced distribution.
                                              7
Ranking: In this method, the supervisor lists all subordinates in order, from the highest to the
lowest in performance. Rankings such as this are appropriate only in small companies. As the
number of employees increases, it becomes gradually more difficult to discern differences in
their performance.

Paired Comparisons: The paired comparison method involves comparing each employee to
every other employee in the rating group, one at a time, to determine the better. A rank order
is obtained by counting the number of times each individual is selected as being the better of
a pair.

Forced Distribution: In forced distribution, the supervisor must assign only a certain
proportion of his/her subordinates to each of several categories on each evaluative factor. A
common forced distribution scale is divided into five categories. A fixed percentage of all
subordinates in the group fall within each of these categories. Typically, the distribution
follows a normal distribution.

          1.4.1.2 Behavioral Appraisals

          In contrast with comparative appraisals, behavioral appraisals allow supervisors to
evaluate each person's performance independent of other employees but relative to important
job-related behaviors, which when exhibited can lead to job success.

Graphic Rating Scale: The graphic rating scale allows the rater to mark an employee's job
performance on a five-point or seven-point scale. This method identifies certain subjective
character traits, such as 'pleasant personality', 'initiative' or 'creativity' to be used as basic job
performance criteria. Because of its simplicity, the graphic rating scale is the most frequently
used performance appraisal method.

Checklist: The checklist uses a list of statements or words that are checked by raters. Raters
check statements most representative of the characteristics and performance of an employee.
Typical checklist statements are: can be expected to finish working time, seldom agrees to
work overtime, is cooperative and helpful, accepts criticism, and strives for self-
improvement. The checklist can be modified so that varying weights are assigned to the
                                                  8
statements or words. The results can then be quantified. Usually, the results are not known by
the rater and are tabulated by someone else, such as a member of the HR unit.

Critical Incidents: In the critical incident method, the manager keeps a written record of the
highly favorable and unfavorable actions in an employee's performance. When something
happens [a 'critical incident' involving a particular employee] the manager writes it down.
Thus, a list of critical incidents is kept during the entire rating period for each employee. The
critical incident method can be used with other methods to document the reasons why an
employee was rated in a certain way.

Essays: The essay (free-form) appraisal method requires the manager to write a short essay
describing each employee's performance during the rating period. The rater usually is given a
few general headings under which to categorize comments. The intent is to allow the rater
more flexibility than other methods do. As a result, the method is often combined with other
methods.

Behaviorally Anchored Rating Scales (BARS): BARS utilize critical incidents to focus
appraisal on employee behaviors that can be changed. Thus, a BARS system describes
examples of 'good' or 'bad' behavior. These examples are 'anchored', or measured, against a
scale of performance levels. An example of BARS that rates a university professor's attitude
toward students is sited here. Construction of BARS begins with the identification of
important job dimensions. The dimensions are the most important performance factors in an
employee's description. Assume the major job dimensions associated with teaching are:
course organization, attitude toward students, fair treatment, and competence in subject area.
Short statements, similar to critical incidents, are developed that describe both desirable and
undesirable behaviors. Then they are 'retranslated' or assigned to one of the job dimensions.
This task is usually a group project and assignment to a dimension usually requires the
agreement of 60% to 70% of the group. The group, consisting of people familiar with the job,
then assigns each 'anchor' a number, which represents how 'good' or 'bad' the behavior is.
When numbered, these anchors are fitted to a scale. The drawbacks are: behaviorally
anchored rating scales require extensive time and effort to develop and maintain. Also,


                                               9
separate BARS forms are necessary to accommodate different types of jobs in an
organization.

360 Degree Appraisal system: In human resources or industrial psychology, 360-degree
feedback, also known as multi-rater feedback, multi source feedback, or multi source
assessment, is feedback that comes from members of an employee's immediate work circle.
Most often, 360-degree feedback will include direct feedback from an employee's
subordinates, peers, and supervisor(s), as well as a self-evaluation. It can also include, in
some cases, feedback from external sources, such as customers and suppliers or other
interested stakeholders. It may be contrasted with "upward feedback," where managers are
given feedback only by their direct reports, or a "traditional performance appraisal," where
the employees are most often reviewed only by their managers.

       1.4.1.3 Output-based Appraisals

       While the methods described above focus on job behaviors or processes, output-based
appraisals focus on job products as the primary criteria. The most commonly used output-
based appraisal is Management-by-Objectives (MBO). MBO specifies the performance
goals that an individual hopes to attain within an appropriate length of time. The objectives
that each manager sets are derived from the overall goals and objectives of the organization.
Implementing an MBO appraisal system comprised four basic stages.

Job Review and Agreement: In the first phase the employee and the supervisor review the
job description and the key activities that comprise the employee's job. The idea is to agree
on the exact makeup of the employee's job.

Development of Performance Standards: Specific standards of performance must be
mutually developed. This phase specifies a satisfactory level of performance that is specific
and measurable.

Guided Objective Setting: Objectives are established by the employee in conjunction with,
and guided by, the supervisor. Objectives should be realistically attainable and may be
different from the set performance standard.
                                               10
Continuing Performance Discussions: The employee and the supervisor use the objectives
as bases for continuing discussions about the employee's performance. Although a formal
review session may be scheduled, the employee and the manager do not necessarily wait
until the appointed time for performance discussion. Objectives are modified mutually, and
progress is discussed during the period.




                                           11
2. NEED, OBJECTIVE AND SCOPE OF THE STUDY

2.1 NEED FOR THE STUDY

       Automobile has become important need of people in their fast moving life. These
automobile companies are expanding in greater phase in various countries especially in
highly populated countries like India, China etc. These Companies are also contributing
towards the development of economy for a long time and at the moment it is treated as an
important industry in modern world. Due to globalization and free market economy, this
industry is facing severe competition, also it makes establishment of foreign company in
other countries. Most of the automotive companies fail due to lack of proper strategic
planning and goals. One of the major reasons of their poor performance is adaptation of
traditional production system. They are very much slow in adopting new product line, less
concerned about attracting and satisfying customers and being reluctant to implement
information technology. That’s why it is very necessary for each and every industry to
evaluate its performance over the periods.

Thus the purposes of choosing the topic are,

   •   I feel that performance appraisal of employees will result in better productivity.
   •   For the better understanding of the concept of performance appraisal.
   •   To provide feedback on appraisal system of the company for further improvement of
       the system.

2.2 OBJECTIVE OF THE STUDY

       2.2.1 Primary Objective:

   •   To study the performance appraisal of employees at BMW Group Chennai.




                                               12
2.2.2 Secondary Objective:
   •   To study the purpose of performance appraisal conducted at BMW.
   •   To understand the opinion of employees towards performance appraisal at BMW.
   •   To identity the effect of performance appraisal on individual and organizational
       development.
   •   To understand the existing relationship between management and employees.
   •   To identify ways to improve the existing performance appraisal system.

2.3 SCOPE OF THE STUDY

   •   The management can identify the employee's opinion of the existing performance
       appraisal system.
   •   The study can be used to make the present appraisal system more effective and
       satisfied among employees.
   •   It could be used to identify training and development needs for the individual and the
       organization as a whole

2.4 LIMITATIONS OF THE STUDY

       Production is, in fact, a huge operation and it is quite impossible to cope up all the
activities during internship period. And for that reason limitations prevail while conducting
the survey. Basic limitations faced while preparing the study were:

   •   The Company’s policy of not disclosing some data and information for obvious
       reasons, which would have been very much useful for the report.
   •   Some of the questionnaires were incomplete.
   •   Few employees sometime felt disturbed, as they were busy in their job.
   •   Sometimes it was difficult to collect data from their files, because important files are
       kept in volt for safety.
   •   It is difficult to make information based a rich report in short time of period.
   •   This report was prepared in short time.


                                               13
3. LITERATURE REVIEW


3.1 PERFORMANCE APPRAISAL

       Performance appraisal is one of the most important requirements for all successful
business and human resource policy (Kressler, 2003). Rewarding and promoting effective
performance in organization, as well as identifying ineffective performers for resource
management (Pulakos, 2003). The ability to conduct performance appraisal relies on the
ability to assess an employee's performance in a fair and accurate manner. Evaluating
employee performance is a difficult task. Once the supervisor understands the nature of the
job and the source of information, the information needs to be collected in a systematic way,
provided as feedback, and integrated into the organization's performance management
processor use in making compensation, job placement and training decisions and assignment
(London, 2003).

       Performance evaluations have been conducted since the times of Aristotle (Landy,
Zedeck, Cleveland, 1983). The earliest formal employee performance evaluation program is
thought to have originated in the United States military establishment shortly after the birth
of the republic (Lopez,1968). The measurement of an employee's performance allows for
rational administrative decisions at the individual employee level. It also provides for the
raw data for the evaluation of the effectiveness of such personnel-system components and
processes as recruiting policies, training programs, selection rules, promotional strategies,
and reward allocations (Landy, Zedeck, Cleveland, 1983).In addition, it provides the
foundation for behaviorally based employee counseling. In the counseling setting,
performance information provides the vehicle for increasing satisfaction, commitment, and
motivation of the employee. Performance measurement allows the organization to tell the
employee something about their rates of growth, their competencies, and their potentials.
There is little disagreement that if well done, performance measurements and feedback can
play a valuable role in effecting the organization (Landy, Zedeck, Cleveland, 1983).



                                             14
3.2 BASIC PURPOSE

       Performance appraisals should focus on three objectives: performance, not
personalities; valid, concrete, relevant issues, rather that subjective emotions and feelings;
reaching agreement on what the employee is going to improve in his performance and what
you are going to do (MeKirehy,1998). Both the supervisor and employee should recognize
that a strong relationship exists between training and performance evaluation (Barr, 1993).
Each employee should be allowed to participate in periodic sessions to review performance
and clarify expectations. Both the supervisor and the employee should recognize these
sessions as constructive occasions for two-way should include opportunities for self-
assessment as well as supervisor feedback.

       The supervisor should keep in contact with the employee to assure the training
experiences are producing desired impact (Barr, 1993). A portion of the process should be
devoted to an examination of potential opportunities to pursue advancement of acceptance of
more complex responsibilities. The employee development goals should be recognized as
legitimate, and plans should be made to reach the goals through developmental experiences
or education (Barr, 1993).        Encouraging development is not only a supervisor's
professional responsibility, but it also motivates an employee to pursue additional
commitments. In addition, the pursuit of these objectives will also improve the prospect that
current employees will be qualified as candidates when positions become available. This
approach not only motivates current performance but also assists the recruitment of current
employees as qualified candidates for future positions (Barr, 1993).


3.3 BENEFITS OF PRODUCTIVE PERFORMANCE APPRAISALS

       Employee learns of his or her own strengths in addition to weaknesses. New goal
and objectives are agreed upon. Employee is an active participant in the evaluation
process. The relationship between supervisor and employees is taken to an adult-to-adult
level. Work teams may be restructured for maximum efficiency. Employee renews his or
her interest in being a part of the organization now and in the future. Training needs are
identified. Time is devoted to discussing quality of work without regard to money issues.

                                             15
Supervisor becomes more comfortable in reviewing the performance of employees.
Employees feel that they are taken seriously as individuals and that the supervisor is truly
concerned about their needs and goals. (Randi, Toler, Sachs, 1992).

3.4 PITFALLS TO AVOID

       When conducting performance appraisals on any level, it is important to keep in
mind the common pitfalls to avoid.

These pitfalls may include but are not limited to:
1. Bias/prejudice-Race, religion, education, family background, age, and/or sex.
2. Trait assessment-Too much attention to characteristics that have nothing to do with the
job is difficult to measure.
3. Over-emphasis on favorable or unfavorable performance of one or two tasks which
could lead to an unbalanced evaluation of the overall contribution.
4. Relying on impressions rather than facts.
5. Holding the employee responsible for the impact of factors beyond his/her control.
6. Failure to provide each employee with an opportunity for advance preparation
(Maddux,1993).


3.5 LEGAL IMPLICATIONS

       Any performance appraisal system used to make employment decisions about a
member of a protected class (i.e. Based on age, race, religion, gender or national origin)
must be a valid system (an accurate measure of performance associated with job
requirements. Other it can be challenged in the courts based on Title VII of the 1964, Civil
Rights Act, the Civil Rights Act of 1991 and the Age Discrimination in Employment Act of
1975 (London, 2003).

       Effectiveness of performance Appraisal system it is argued is a function of applying
the right system in right context. –By Klein; the Art of Appraisal.
       Performance appraisal system are "homework" that provides the information you
need in order to make appropriate administrative recommendations, hold meaningful

                                               16
feedback discussions with staff members, and determined were performance improvement is
required. -    By Marion E. Haynes; Managing Performance.
       The effectiveness of an Appraisal System is determined by the quality of
communication between the manager and staff member, not by multiple raters, complex
scoring methods, or the form used.-By John D. Drake; Performance Appraisal.
       One More Time Performance appraisal can actually be counter-productive for
employees who are in the greatest need of training and further development.-By Victor
Buzzottan; improving your Performance Appraisal.
       One of the measure reason Performance management and Performance Appraisal fail
is that too much time is spent on Appraising performance using vague criteria and not
enough time and effort put into helping employee understands what his job is about, and the
goals and objectives he/she is expected to achieve to be successful. Learn to do goals setting
painlessly. – By Robert Dacal; Learn to plan Performance and set employee goals.

       Maximizing and measuring our own performance and that of the people who work
for us is a basic tenant of the work environment. Always use of simple too land approach that
can be beneficial in achievement performance plan.-By Zack Mansdorf; Performance
Management; Identifying work goals.

       Most managers and supervisors today are attempting to quantify their departmental
objective and pass them on their employees through performance standards. Despite the
simplicity of this management-by-objective approach, deadlines are missed, quality is
relatively poor and productive is low. The reasons for this may not be the fault of the
employees carrying out the work. The cause is most often associated with the immediate
supervisor's lack of attention to the realities surrounding objectives and performance
standards require a careful analysis of all the relevant issues. –By Gregory Isaac; Plan for
performance.

       Organizations striving to develop an open and participative approach have begun to
give employees the chance to say what they think of their managers. Such appraisals can
only work in a culture where mangers are willing to listen and learn and effect any necessary
changes as a result.   - By Madhukar Shukla; Upward Appraisal and Organizational
culture.

                                             17
A tone stage performance appraisal relied mainly on personality characteristics.
Subordinates were being appraised by their superior on the extent to which they exhibited
characteristic like, tact, willingness, enthusiasm, and maturity. Mangers were being put into
position of psychologists and required to make subjective ratings without any point of
reference expect their own opinion. –By Bob Nelson; Performance Assessment.

       Performance appraisal is a part of overall performance management system of an
organization. Through the appraisal process, gap between an individual's agreed performance
standard his actual performance is assessed and appropriate strategies are drawn for
subsequent performance cycle. This is a useful performance enhancement exercise. In many
Organizations, PMS is linked with other systems like salary &Benefits, Training &
Development and Succession Planning. - By H. K. Shukla; Striates Human Resource
Management.




                                             18
4. RESEARCH METHODOLOGY

       Research in common parlance refers to search for knowledge. Redman and Mory
define research as a “Systematized effort to gain new knowledge. Research is an academic
activity and such the term should be used in technical sense. According to Clifford Woody,
Research comprises defining and redefining problem, formulating hypothesis or suggested
solutions; collecting, organizing and evaluating data; making deductions and research
conclusions; and at last carefully testing the conclusions to determine whether they fit the
formulating hypothesis.

       Research is thus an original contribution to the existing stock of knowledge making
for its advertisement. It is pursuit of truth with the help of study, observation, comparison and
experiment. In short the search for knowledge through objective and systematic method of
finding solution to problem is research.



4.1 RESEARCH DESIGN

       A Research design is the arrangement of conditions for collection and analysis of data
in a manner that aims to combine relevance to the Research purpose with economy in
procedure. In fact the Research design is the conceptual structure within which Research is
conducted: it constitutes the blueprint for the collection measurement and analysis of data.

       It must be able to define clearly what they want to measure and must find adequate
methods for measuring it along with a clear cut definition of population wants to study. Since
the aim is to obtain complete and accurate information in these studies, the procedure to be
used must be carefully planned. The research design must make enough provision for
protection against bias and must maximize reliability with due concern for the economical
completion of the search study.

       Descriptive research is adopted for this study. It includes surveys and fact finding
enquires of different kinds. The major purpose of descriptive research is description of the
state affairs as it exists at present. The main characteristic of this method is that the

                                               19
researcher has no control over the variables. He can only report what has happened or what is
happened.

4.2 SAMPLING DESIGN

       A sample design is a definite plan for obtaining a sample from the sampling frame, it
refers to the technique or procedure the researcher would adopt in selecting some sampling
units from which interferences about the population is drawn. Sampling type used is Simple
Random sampling technique.

       4.2.1 POPULATION AND SAMPLE SIZE

        A decision has to be taken concerning sampling unit before selecting sample. The
population for this study includes the employees from three branches of BMW group. The
total population of BMW group is 800. 100 employees were undertaken for the study.

4.3 DATA COLLECTIONS

For achieving the specific objectives of this study, data were gathered from both primary and
secondary sources.

   4.3.1 Primary Sources

   •   Direct conversation with the respective officers of the Departments.
   •   Face to face conversation with the employees.
   •   Employee’s opinion collected through Questions.
   •   Observation of HR activities.

   4.3.2 Secondary Sources:

   •   Various records of the Company.
   •   Different Types of system information.
   •   Website of BMW Group.
   •   Different newsletters.
   •   Annual Performance Appraisal Form of company.
   •   Personal files of employees.
                                             20
4.4 STATISTICALTOOLS

     Chi-square test
     Percentage analysis


           4.4.1 CHI-SQUARE TEST

           The Chi-square test is an important test amongst the several tests of significance
developed b y statisticians. Chi-square is a statistical measure used in the context of
sampling analysis for comparing a variance to a theoretical variance. As a non-parametric
test, it can be used to determine if categorical data shows dependency or the two
classifications are independent. The test is, in fact, a technique through the use of which it is
possible for all researchers to

   i.      Test the goodness of fit
  ii.      Test the significance of association between two attributes and
 iii.      Test the homogeneity or the significance of population variance.

        As a test of independence,    test enables us to explain whether or not two attributes are
associated. In such a situation, we proceed with the null hypothesis that the two attributes are
independent. If the calculated value is less than the tabulated value at certain degrees of
freedom, the null hypothesis is accepted and vice versa.

        is calculated as follows:


                                            = ∑ (O-E) 2
                                                      E


Where

    = Chi-Square
Oi = Observed Frequency
Ei = Expected Frequency
           is always positive.
                                                 21
The expected value for the contingency tabulated as follows.
                                    E=     (Row total*Column total)
                                                   Grand total
The    test depends on the set of observed and expected values and on the degrees of
freedom. The     distribution is the limiting approximation designation.

       4.4.2 PERCENTAGE ANALYSIS

       It refers to a special kind of ratio. Percentage is used in making comparison
between two or more series of data; percentages are used to determine relationship between
the series if data finding the relative differences becomes easier through percentage.

It is expressed as,


                               Percentage (%) = No. of respondents         x 100
                                                   Total no. of respondents




                                              22
5. DATA ANALYSIS AND INTERPRETATION


5.1 GENDER WISE CLASSIFICATION OF RESPONDENTS


TABLE 5.1 GENDER WISE CLASSIFICATION OF RESPONDENTS
           Gender                   No. of respondents          Percentage (%)
            Male                             89                       89
           Female                            11                       11
             Total                           100                       100

Source: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 89% of the respondents are male and 11% of the
respondents are female.




FIGURE 5.1 GENDER WISE CLASSIFICATION OF RESPONDENTS




                                            23
5.2 AGE WISE CLASSIFICATION OF RESPONDENTS


TABLE 5.2 AGE WISE CLASSIFICATION OF RESPONDENTS
             Age                    No. Of Respondents          Percentage (%)
          20-25Age                          25                        25
          30-35Age                          33                        33
          40-45Age                          30                        30
         Above-45Age                        12                        12
                  Total             100                               100

Source: Primary Data

INTERPRETATION:

From the above table, it can be inferred that 33% of the respondents are in the age of
30-35, 30% of the respondents are in the age of 40-45, 25% of the respondents are in the age
of 20-25 and 12% of the respondents are in the age above 45.




FIGURE 5.2 AGE WISE CLASSIFICATION OF RESPONDENTS




                                              24
5.3 EXPERIENCE WISE CLASSIFICATION OF RESPONDENTS


TABLE 5.3 EXPERIENCE WISE CLASSIFICATION OF RESPONDENTS
      Experience             No. Of Respondents            Percentage (%)
     Below 5Years                     28                         28
      5-lO Years                      54                         54
     10-15 Years                      18                         18
     Above15Years                      -                          -
         Total                       100                       100%

Sources: Primary Data
INTERPRETATION:
From the above table, it can be inferred that 54% of the respondents are having 5-10years
experience persons, 28% of the respondents have below 5Years of experience persons, 18%
of the respondents are having 10-15years of experience and no respondents have experience
more than 15years.




FIGURE 5.3 EXPERIENCE WISE CLASSIFICATION OF RESPONDENTS




                                           25
5.4 EDUCATIONAL QUALIFICATIONS OF RESPONDENTS


TABLE 5.4 EDUCATIONAL QUALIFICATIONS OF RESPONDENTS
 Educational Qualification       No. Of Respondents         Percentage (%)
        UG degree                             49                  49
        PG degree                             19                  19
       Engineering                            04                  04
         Other ITI                            28                  28
          Total                              100                100%

Sources: Primary Data
INTERPRETATION:
From the above table, it can be inferred that 49% of the respondents are UG degree holders,
28% of the respondents are some others (ITI), 19% of respondents are PG degree holders
and 4% of the respondents are engineering graduates.




FIGURE 5.4 EDUCATIONAL QUALIFICATIONS OF RESPONDENTS




                                            26
5.5 FREQUENCY OF PERFORMANCE APPRAISAL


TABLE 5.5 FREQUENCY OF PERFORMANCE APPRAISAL
  Performance Appraisal                No. of respondents        Percentage (%)
        Once a Year                            100                     100
       Twice a Year                             -                       -
     No Specific Time                           -                       -
          Total                                100                     100

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 100% of the respondents agree that performance
appraisal is conducting once a year.


5.6 REASON FOR CONDUTING PERFORMANCE APPRISAL


TABLE 5.6 REASON FOR CONDUTING PERFORMANCE APPRISAL
  Performance Appraisal                No. of respondents        Percentage (%)
          Conducting
To identity motivating methods                 -                         -
To decide monetary benefits                    -                         -
Identifying barriers of                        -                         -
performance
All of the above                              100                       100
Total                                         100                       100

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 100% of the respondent's agree that the reason
for conducting performance appraisal includes all the factors such as to identity motivating
methods, to decide monetary benefits and identity barriers for performance.




                                             27
5.7 DURATION OF PERFORMANCE APPRAISAL CONDUCTED


TABLE 5.7 DURATION OF PERFORMANCE APPRAISAL CONDUCTED
     When Performance               No. of respondents         Percentage (%)
    Appraisal conducted
During working hours                        87                        87
During non-working hours                     13                       13
Total                                       100                      100

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that for 87% of the respondents' performance
appraisal is conducted during working hours and for 13% respondents' performance appraisal
is conducted during non-working hours.




FIGURE 5.7 DURATION OF PERFORMANCE APPRAISAL CONDUCTED




                                           28
5.8 WHO CONDUCT PERFORMANCE APPRAISAL


TABLE 5.8 WHO CONDUCT PERFORMANCE APPRAISAL

      Who Conducts                 No. Of Respondents         Percentage (%)
  Performance appraisal
         Superior                       -                       -
           Peers                        -                       -
         Everyone                       -                       -
         Outsider                      100                     100
     Total                             100                     100

Sources: Primary Data
INTERPRETATION:
From the above table, it can be inferred that for 100% of the respondents’ performance
appraisal is conducted by outsiders.


5.9 REASONS FOR PERFORMANCE APPRAISAL DISCUSSED


TABLE 5.9 REASONS FOR PERFORMANCE APPRAISAL DISCUSSED
    Informed reason for
   Performance appraisal
                                   No. Of Respondents         Percentage (%)
        conducting
          Always                       20                      20
         Sometimes                     77                      77
           Never                       03                      03
     Total                             100                     100

Sources: Primary Data
INTERPRETATION:
From the above table, it can be inferred that 77% of respondents feel that the reason for
performance appraisal is discussed sometimes, 20% of the respondent's feel it is discussed
always and 3% of respondents say reason is never discussed.




                                             29
FIGURE 5.9 REASONS FOR PERFORMANCE APPRAISAL DISCUSSED


5.10 EMPLOYEE PERFORMANCES DISCUSSED


TABLE 5.10 EMPLOYEE PERFORMANCES DISCUSSED

         Meetings of               No. Of Respondents    Percentage (%)
    Employee performance
                Nil                      -                  -
               Once                      100               100
               Twice                      -                 -
               Thrice                    -                  -
       Total                             100               100%

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that for 100% of the respondents meeting on
performance is conducting once a year.




                                               30
5.11 PERFORMANCE APPRAISAL PROGRAMS RELATED WITH
     ORGANIZATIONAL GOALS


TABLE 5.11 PERFORMANCE APPRAISAL PROGRAMS RELATED WITH
               ORGANIZATIONAL GOALS
         Goals                 No. Of Respondents             Percentage (%)
    To a high extent                 12                         12
    To some extent                   69                         69
    To a low extent                  19                         19
   Total                             100                        100

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 69% of the respondents feel the performance
appraisal relates to some extent to organization goals, 19% feel to a low extent and12% feel
to a high extent it relates.




FIGURE 5.11 PERFORMANCE APPRAISAL PROGRAMS RELATED WITH
                 ORGANIZATIONAL GOALS




                                            31
5.12 1NVOLVEMENT IN DESIGNING APPRAISAL SYSTEM


TABLE 5.12 INVOLVEMENT IN DESIGNING APPRAISAL SYSTEM
           Opinion                   No. of Respondents         Percentage (%)
            Always                     -                          -
          Sometimes                    -                          -
             Never                    100                        100
       Total                           100                        100

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 100% of the respondents say they are never
involved in designing the appraisal system.


5.13 PERFORMANCE APPRAISAL RELEVANCE TO EMPLOYEE JOB


TABLE 5.13 PERFORMANCE APPRAISAL RELEVANCE TO EMPLOYEE JOB
   S. No             Relevance            No. Of Respondents         Percentage (%)
   1              Highly relevant              87                       87
   2                Relevant                   13                       13
   3                 No idea                   -                        -
   4                Irrelevant                 -                        -
   5             Highly irrelevant             -                        -
                       Total                  100                       100

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 87% of the respondents feel that performance
appraisal is highly relevant to employee job and 13% feel it is relevant.




                                              32
FIGURE 5.13 PERFORMANCE APPRAISAL RELEVANCE TO EMPLOYEE
                JOB


5.14 OPINION AND SUGGESTIONS SHARED TO MANAGERS


TABLE 5.14 OPINION AND SUGGESTIONS SHARED TO MANAGERS

  Opinion and Suggestions         No. of Respondents       Percentage (%)

              Mostly                100                     100
              Rarely                 -                       -
              Never                  -                       -
      Total                          100                     100

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 100% of the respondents mostly share their
opinion and suggestions to their managers.




                                             33
5.15 TRAINING OF FILL UP PERFORMANCE APPRAISAL FORM


TABLE 5.15 TRAINING OF FILL UP PERFORMANCE APPRAISAL FORM
          Forms                  No. of respondents           Percentage
          Yes                      100                           100
           No                       -                             -
          Total                    100                           100%

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 100% of the respondents are given training to fill
the appraisal form.


5.16 APPRAISER'S AWARENESS ON EMPLOYEE JOB RESPONSIBLITIES
     AND DUTIES


TABLE 5.16 APPRAISER'S AWARENESS ON EMPLOYEE JOB
              RESPONSIBLITIES AND DUTIES
         Aware                   No. of respondents             Percentage (%)
   Completely Aware                        -                           -
   Aware to an extent                      -                           -
     Not Aware                            100                         100
        Total                             100                        100%

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 100% of the respondents feel that the appraiser
is not aware of their job responsibilities and duties.




                                                34
5.17 FEEDBACKS PROVIDED FOR PERFORMANCE IMPROVEMENT


TABLE 5.17 FEEDBACKS PROVIDED FOR PERFORMANCE
              IMPROVEMENT
         Aware                 No. of respondents            Percentage (%)
       Frequently                       89                          89
      Occasionally                      11                          11
         Never                          -                           -
         Total                         100                        100%

Sources: Primary Data
INTERPRETATION:
From the above table, it can be inferred that 89% of the respondents feel that feedback is
provided occasionally whereas 11% feel that feedback is provided frequently.




FIGURE 5.17 FEEDBACKS PROVIDED FOR PERFORMANCE
               IMPROVEMENT




                                             35
5.18 INVOLVEMENT OF RATER


TABLE 5.18 INVOLVEMENT OF RATER
     Involvement                No. of respondents             Percentage (%)
    Highly involved                      34                          34
     Less involved                       40                          40
     Not involved                        26                          26
         Total                          100                        100%

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 44% of the respondents feel the rater is less
involved, 34% of the respondents feel they are highly involved and 26% of the respondents
are not involved.


5.19 PROPER EXECUTION OF PERFORMANCE APPRAISAL


TABLE 5.19 PROPER EXECUTION OF PERFORMANCE APPRAISAL

  Properly executed in your
    organization                     No. Of Respondents          Percentage (%)
              Yes                       78                          78
               No                       22                          22
              Total                     100                         100

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 78% of the respondents feel performance
appraisal is properly executed while 22% feel it is not properly executed.




                                              36
FIGURE 5.19 PROPER EXECUTION OF PERFORMANCE APPRAISAL

5.20 UPDATING OF PERFORMANCE APPRAISAL

TABLE 5.20 UPDATING OF PERFORMANCE APPRAISAL

     Reviewed and updated          No. Of Respondents        Percentage (%)
           Frequently                46                        46
          Occasionally               54                        54
             Never                    -                         -
       Total                         100                       100

Sources: Primary Data

INTERPRETATION:
From the above table, it can be inferred that 54% of the respondents feel the performance
appraisal is reviewed occasionally while 46% of respondents feel they are reviewed
frequently.




                                           37
FIGURE 5.20 UPDATING OF PERFORMANCE APPRAISAL


5.21 STATISTICAL ANALYSIS

      5.21.1 CHI-SQUARE TEST

TABLE 5.21.1 CROSS TABULATION BETWEEN THE CHANGES TAKEN FOR

                 PERFORMANCE APPRAISAL AND IMPROVEMENT OF

                 PERFORMANCE APPRAISAL.


 Improvement
      in         Highly                              In         Highly
                             Effective   Moderate                           Total
Overall          effective                          Effective ineffective
PA

 Change in
 motivating       7           5           9          12         0           33
   strategy
Re-structuring
      of
organization      12          2           6           3         2           25
or individual
 objectives



                                              38
Improvement
        in
 Management         11       8           0               6        0          25
  employment
  relationship
    Making
  changes in        4        1           0               4        8           17
  dissatisfied
     areas
  No decision       0        0           0               0        0          0
     taken
     Total          34       16          15              25      10           100



STEP 1: SETTING AN HYPOTHESIS

H0: There is no significant relationship between the changes taken for performance appraisal
and improvement of performance appraisal.

H1: There is significant relationship between the changes taken for performance appraisal
and improvement of performance appraisal.
STEP 2: TO FIND THE EXPECTED FREQUENCY
              Expected frequency = Corresponding row total * Corresponding column total
                                               Total number of samples

STEP 3: CALCULATION OF CHI-SQUARE VALUE

                 Formula:
                                       =∑          (O-E) 2
                                                     E
Where

   = Chi-Square
Oi = Observed Frequency
Ei = Expected Frequency


                                              39
TABLE 5.21.1.1 COMPUTATION TABLE FOR


     O            E           (O-E)    (O-E)2   (O-E)2/E

     7           11.22        -4.22    17.81      1.59
     5            5.28        -0.28    0.08       0.01
     9           4.95         4.05     16.40     3.31
     12          8.25         3.75     14.01     1.70
     0           3.30         -3.30    10.8      3.30

     12          8.50         3.50     12.25      1.44
     2           4.00         -2.00    4.00      1.00

     6           3.75         2.25      5.0      1.35

     3           6.25         -3.25     10.5     1.69

     2           2.50         -0.50    0.25      0.10
     11          8.50         2.50      6.25     0.74

     8           4.00         4.00     16.00     4.00

     0           3.75         -3.75    14.06      3.75
     6           6.25         -0.25     0.06     0.01
     0           2.50         -2.50     6.25     2.50
     4           5.78         -1.78     3.11      0.55
     1           2.72         -1.72     2.9      1.09
     0           2.55         -2.55     6.50     2.55
     4           4.25         -0.25     0.0      0.01
     8           1.70         6.30     39.69     23.35
     0           0.00         0.00      0.00     0.00
     0           0.00         0.00      0.00     0.00
     0           0.00         0.00      0.00     0.00
     0           0.00         0.00      0.00     0.00
     0           0.00         0.00      0.00     0.00

                      TOTAL                       54.04




                              40
STEP 4: LEVEL OF SIGNIFICANCE

Level of significance α = 0.05
Degrees of freedom       = (R-1) (C-1)

                         = (4-1) (5-1) =12
Tabulated value at 5% level of significance and degree of freedom 12 is 21.026


STEP 5 : COMPARING WITH TABLE VALUE
The calculated value is greater than the tabulated value: 54.04 > 26.296


FINDING
Therefore, reject the Null Hypothesis Ho and accept the Alternate Hypothesis H1.
INFERENCE
There is significant relationship between the changes taken for performance
appraisal and improvement of performance appraisal.


TABLE 5.21.2 CROSS TABULATION BETWEEN THE PROPER EXECUTION OF
                 PERFORMANCE APPRAISAL AND RATING EMPLOYEE
                 PERFORMANCE.
                          Proper
                         execution
                                                             YES           NO      TOTAL
   Rating
   Performance
                 Based on abilities and skills                8            2        10
            Based on management reference                     19           6        25
                   Based on superiority                       21           4        25
                  Based on contribution                       30           10       40
                         TOTAL                                78           22       100




                                                 41
STEP 1: SETTING AN HYPOTHESIS

H0: There is no significant relationship between the changes taken for performance appraisal
and improvement of performance appraisal.

H1: There is significant relationship between the changes taken for performance appraisal
and improvement of performance appraisal.
STEP 2: TO FIND THE EXPECTED FREQUENCY

              Expected frequency = Corresponding row total * Corresponding column total
                                               Total number of samples

STEP 3: CALCULATION OF CHI-SQUARE VALUE
          Formula:
                                       =∑        (O-E) 2
                                                    E
Where
  = Chi-Square
Oi = Observed Frequency
Ei = Expected Frequency


TABLE 5.21.2.1 COMPUTATION TABLE FOR
        O                  E                (O-E)           (O-E)2        (O-E)2/E

        8                 7.80               0.20               0.04         0.01
        2                 2.20              -0.20               0.04         0.02
        19                19.50             -0.50               0.25         0.01
        6                 5.50               0.50               0.25         0.05
        21                19.50              1.50               2.25         0.12
        4                 5.50              -1.50               2.25         0.41
        30                31.20             -1.20               1.44         0.05
        10                8.80               1.20              1.44          0.16

                                  TOTAL                                      0.82

                                            42
STEP 4: LEVEL OF SIGNIFICANCE

Level of significance α = 0.05

Degrees of freedom        = (R-1) (C-1)

                          = (4-1) (2-1) = 3
Tabulated value at 5% level of significance and degree of freedom 3 is 7.28


STEP 5 : COMPARING WITH TABLE VALUE
The calculated value is greater than the tabulated value: 0.82<7.82


FINDING
Therefore, accept the Null Hypothesis H0 and reject the Alternate Hypothesis H1.


INFERENCE
There is no significant relationship between the changes taken for performance appraisal and
improvement of performance appraisal.




                                                43
6. SUMMARY AND CONCLUSION


6.1 FINDINGS


  1. Majority (89%) of respondents are male.


  2. Most of the respondents (33%) belong to the age group of 30 to 35.


  3. 54% of the respondents have above 5 to10years of work experience.


  4. Majority (49%) of the respondents are under graduates.


  5. All of the respondents have under gone performance appraisal program once in a
     year.


  6. 100% of the employees interpret the reason for conducting performance appraisal
     includes all the factors such as to identify motivating methods, to decide monetary
     benefits and identify barriers for performance.


  7. For 87% of the respondents performance appraisal was conducted during working
     hours.


  8. For 100% of the respondents the performance appraisal is conducted by outsider.


  9. Most (77%) of the respondents feel that the reason for performance appraisal is
     discussed sometimes.


  10. Once in a year the meeting IS        scheduled for all employees to discuss their
     performance.

                                           44
11. 69% of the respondents feel that performance appraisal is related to organizational
   goals to some extent.


12. All of the respondents infer that they are never involved in designing the performance
   appraisal system.


13. 87% of the respondents feel that the performance appraisal system is developed
   highly relevant to the employee’s job.


14. All respondents mostly share their opinion and suggestions freely during the
   performance appraisal.


15. All respondents have got the training to fill up the performance appraisal forms.


16. All of the respondents feel that the appraiser is not aware of the jobs and duties of the
   each and every employee.


17. 89% respondents feel the superior will provide informal feedbacks for
   performance improvement occasionally.


18. Most (44%) of the respondents feel that the raters are less involved while appraising
   employees.


19. Most (78%) of the respondents says the Performance Appraisal is properly executed
   in the organization.


20. Majority (54%) of the respondents feel that performance appraisal system is reviewed
   and updated occasionally.




                                            45
6.2 SUGGESTIONS


     1. Performance appraisal could be conducted by a person inside the organization and
        one who is familiar with the employees.
     2. Objective of conducting the performance appraisal could be discussed and doubts
        can be clarified.
     3. Performance appraisal could be updated regularly to match individual and
        organizational goals.
     4. Suggestion could be obtained from employees regarding framing the performance
        appraisal system.
     5. Since the performance appraisal is conducted by the outsider, employees'
        suggestion during performance appraisal may not reach the top managers. For
        such situations suggestion box can be implemented and frequently reviewed.
     6. The appraiser must be familiarized with the employee's job responsibilities and
        duties before conducting performance appraisal.
     7. Feedback on performance could be discussed through formal or informal
        meetings.
     8. This may enhance the involvement and performance of employees.
     9. Appropriate and experienced appraiser can be appointed for effective
        performance appraisal results.
     10. Performance appraisal can developed in such away to identify the hidden talent
        and skills of employees.
     11. Employees having low performance could be called individually, encouraged and
        monitored closely to make improvements.
     12. Appraisal feedback is very important in any performance appraisal program.
        Could be carefully communicated by making high performers increase their target
        and low performers to build up their confidence.




                                          46
6.3 CONCLUSION


          Performance appraisal may be understood as the assessment of an individual's
performance in a systematic way. The performance being measured against such factors as
job knowledge, quality and quantity of output, initiative, leadership abilities, supervision,
dependability, co-operation, judgment, versatility, health and the like. It also helps in
developing strength and rectifies weakness of the employees.


          BMW Group have been conducting performance appraisal for the past four years.
From the study it has been identified that the performance appraisal is able to identify
employees' potential and find the motivating factors of employees. The major drawback is in
terms of the appraiser and his knowledge regarding employee’s job responsibilities and
duties.


          BMW Group has been running successfully for past 5years and has created a good
name among its customers and society. People having poor background are given training
and provided with jobs. Performance appraisal can be conducted more effectively by using
the right tools and properly reviewing and updating the performance appraisal program.
Suggestion form employees and experienced personnel can further enhance and make the
performance appraisal an ideal evaluation system.




                                             47
BIBLOGRAPHY




BOOKS

   Human Resource Management. By S. Seetharaman & B.Venkateswara Prasad, Scitech
   Publication, 2007.

   Kothari, C.R., Research Methodology- Methods & Techniques, New Delhi, New Age
   international(P)Ltd.,Publishers,SecondEdition,2004.

   Performance Management, Concepts, Practices and Strategies for Organisation success
   by S.K.Bhatia, Deep & Deep Publications Pvt. Ltd, 2008.

   Statistical Methods for Management, By P.N.Arora & S.Arora New Delhi, Sultan Chand
   & Sons Publishers, 2005.




WEBSITE


www.BMWGroup.com

www.citehr.com

www.performanceappraisal.com




                                         48
APPENDIX

Name          :
Gender        :       () Male       Female ()
Age group     :       () 20-30
                      () 31-40
                      () 41-50
                      () 51-60
Experience    :       () Less than 3years
                      () 4-8Years
                      () 9-15Years
                      () More than15Years
Qualification :

1. How many times performance appraisal is conducted in your organization?

a) Once a year        b) Twice a year       c) No specific time

2. What is the reason for conducting performance appraisal in your organization?

a) To identify motivating methods           b) To decide monetary benefits

c) Identifying barriers of performance      d) All of the above

3. When is the performance appraisal conducted?

a) During working hours      b) during non-working hours

4. Who conducts performance appraisal?

a) Superior           b) Peers              c) Everyone           d) Outsider




                                            49
5. Are you informed the reason for conducting performance appraisal programs?

a) Always               b) Sometimes          c) Never

6. How many meetings are scheduled in a year to discuss employee performance?

a) Nil          b) Once                c) Twice              d) Thrice

7. Does the performance appraisal programs relate to organizational goals?

a) To a high extent     b) To some extent     c) To a low extent

8. Are you involved along with the manager in designing the appraisal system at the
organization?

a) Always               b) Sometimes          c) Never

9. Is the performance appraisal developed in relevance to employee job?

a) Highly relevant      b) relevant    c) no idea d) Irrelevant       e) highly irrelevant

10. Do you share your opinion and suggestions freely to the managers during the appraisal
program?

a) Mostly       b) rarely      c) never

11. Are you given training to fill up performance appraisal forms?

a) Yes          b) No

12. Is the appraiser aware of your job responsibilities and duties?

a) Completely aware            b) Aware to an extent         c) Not aware

13.0ther than performance appraisal does your superior provide you within formal
feedbacks for performance improvement?

a) Frequently           b) Occasionally       c) never


                                               50
14. Are the raters involved while appraising employees?

a) Highly involved      b) Less involved     c) not involved

15. Do you feel that performance appraisal is important in an organization?

a) Highly important b) less important        c) not important d) No idea

16. Is performance appraisal properly executed in your organization?

a) Yes          b) No

17. Does top management support and encourage performance appraisal?

a) Highly supportive           b) Less supportive          c) Not supportive

18. Is the performance appraisal reviewed and updated now and then?

a) Frequently           b) Occasionally             c) Never

19. Does performance appraisal identify employee potential for advancement?

a) Highly effectively b) Effectively c) Neutral d) Ineffectively e) Highly ineffectively

20. State your satisfaction through the performance appraisal program at the
organization?

a) Unsatisfactory    b) Needs Improvement c) Meets Expectation d) Outstanding

21. Do you feel that performance appraisal encourages you to put in more effort in reaching
your goals?

a) Strongly agree       b) Agree      c) Neutral d) Disagree      e) Strongly disagree

22. Do you obtain appraisal feedback?

a) Frequently b) Occasionally         c) Rarely           d) Never




                                              51
23. Are both five & negative points discussed to the employees?

a) Yes         b) No

24. How do you feel when negative points are discussed?

a) Discouraged         b) Determined to perform better

c) ready to learn      d) Do not want to contribute

25. Rate your appraisal program

a) Reliable    b) Effective    c) Accurate d) Motivating e) Unbiased

26. Do you feel comfortable in discussing your problems with your superior?

a) Highly Comfortable         b) Comfortable                c)Neutral

d) Uncomfortable              e) Highly uncomfortable

27. On what criteria is employee performance rated?

a) Based on abilities and skills     b) Based on management reference

c) Based on superiority              d) Based on contribution

28. What changes have been taken in the organization as a result of performance appraisal?

a) Change in motivating strategy     b)   Re-structuring   of   organization   or   individual
objectives c) Improvement in management-employee relationship d) Making changes in
dissatisfied areas e) No decision taken

29. In general, how effective has your organization performance appraisal system in
improving overall performance

a) Highly ineffective b) Ineffective c) Moderate d) Effective e) Highly effective




                                               52

Recommended

Academic Internship Project on Performance management System by
Academic Internship Project on Performance management SystemAcademic Internship Project on Performance management System
Academic Internship Project on Performance management SystemHR at VASHI ELECTRICALS PVT. LTD.
29.3K views82 slides
MBA HR PROJECT REPORT ON TRAINING AND DEVELOPMENT by
MBA HR PROJECT REPORT ON TRAINING AND DEVELOPMENTMBA HR PROJECT REPORT ON TRAINING AND DEVELOPMENT
MBA HR PROJECT REPORT ON TRAINING AND DEVELOPMENTSalim Palayi
138.2K views98 slides
Project on training and development by karan k kamdi (2) by
Project on training and development by karan k kamdi (2)Project on training and development by karan k kamdi (2)
Project on training and development by karan k kamdi (2)Akshay Bhagat
187.5K views65 slides
Performance Appraisal Project Work by
Performance Appraisal Project WorkPerformance Appraisal Project Work
Performance Appraisal Project WorkSri HimaShouri M
5.8K views63 slides
Performance appraisal of 5 companies done by shweta-bebarta by
Performance appraisal of 5 companies  done by shweta-bebartaPerformance appraisal of 5 companies  done by shweta-bebarta
Performance appraisal of 5 companies done by shweta-bebartaShweta Bebarta
60.8K views21 slides
A Study on Performance Appraisal by
A Study on Performance AppraisalA Study on Performance Appraisal
A Study on Performance AppraisalSaumendra Das
49.8K views118 slides

More Related Content

What's hot

Project Report on Performance Appraisal (College Copy)-Final by
Project Report on Performance Appraisal (College Copy)-FinalProject Report on Performance Appraisal (College Copy)-Final
Project Report on Performance Appraisal (College Copy)-Finalpmpankajpm
10.3K views72 slides
Training & development Research mthodology by
Training & development Research  mthodology Training & development Research  mthodology
Training & development Research mthodology Refkin
19.6K views9 slides
HR POLICIES AND PRACTICES OF TATA MOTORS by
HR POLICIES AND PRACTICES  OF TATA MOTORS HR POLICIES AND PRACTICES  OF TATA MOTORS
HR POLICIES AND PRACTICES OF TATA MOTORS Shree Ganesh
2.9K views14 slides
Tech mahindra ppm by
Tech mahindra ppmTech mahindra ppm
Tech mahindra ppmSuchet Pajni
25K views12 slides
A Comprehensive Project Report on HRIS by
A Comprehensive Project Report on HRIS A Comprehensive Project Report on HRIS
A Comprehensive Project Report on HRIS Radhika Gohel
15.7K views53 slides
Summer internship project hr mba mms by
Summer internship project hr mba mmsSummer internship project hr mba mms
Summer internship project hr mba mmsSria
214.3K views66 slides

What's hot(20)

Project Report on Performance Appraisal (College Copy)-Final by pmpankajpm
Project Report on Performance Appraisal (College Copy)-FinalProject Report on Performance Appraisal (College Copy)-Final
Project Report on Performance Appraisal (College Copy)-Final
pmpankajpm10.3K views
Training & development Research mthodology by Refkin
Training & development Research  mthodology Training & development Research  mthodology
Training & development Research mthodology
Refkin19.6K views
HR POLICIES AND PRACTICES OF TATA MOTORS by Shree Ganesh
HR POLICIES AND PRACTICES  OF TATA MOTORS HR POLICIES AND PRACTICES  OF TATA MOTORS
HR POLICIES AND PRACTICES OF TATA MOTORS
Shree Ganesh2.9K views
A Comprehensive Project Report on HRIS by Radhika Gohel
A Comprehensive Project Report on HRIS A Comprehensive Project Report on HRIS
A Comprehensive Project Report on HRIS
Radhika Gohel15.7K views
Summer internship project hr mba mms by Sria
Summer internship project hr mba mmsSummer internship project hr mba mms
Summer internship project hr mba mms
Sria 214.3K views
Performance Appraisal in Tata Motors by surabhi agarwal
Performance Appraisal in Tata MotorsPerformance Appraisal in Tata Motors
Performance Appraisal in Tata Motors
surabhi agarwal198.2K views
23809590 performance-appraisal-at-wipro by Yogesh Jadhav
23809590 performance-appraisal-at-wipro23809590 performance-appraisal-at-wipro
23809590 performance-appraisal-at-wipro
Yogesh Jadhav9K views
HR Policy and HR Practices of Tata Motors by PavanJadhav33
HR  Policy and HR Practices of Tata MotorsHR  Policy and HR Practices of Tata Motors
HR Policy and HR Practices of Tata Motors
PavanJadhav3339.1K views
Sip Project Report by spragyaa
Sip Project ReportSip Project Report
Sip Project Report
spragyaa77.6K views
Project Report on Performance Appraisal System and Effectiveness in Flora Hot... by PS NEEMISH
Project Report on Performance Appraisal System and Effectiveness in Flora Hot...Project Report on Performance Appraisal System and Effectiveness in Flora Hot...
Project Report on Performance Appraisal System and Effectiveness in Flora Hot...
PS NEEMISH62.7K views
Training and development programme by TATA Group by Shrey Kapoor
Training and development programme by TATA GroupTraining and development programme by TATA Group
Training and development programme by TATA Group
Shrey Kapoor28.9K views
Hr policy of dabur by GOPI YADAV
Hr policy of dabur Hr policy of dabur
Hr policy of dabur
GOPI YADAV14.1K views
A study on training and development conducted at bharathi associates by Projects Kart
A study on training and development conducted at bharathi associatesA study on training and development conducted at bharathi associates
A study on training and development conducted at bharathi associates
Projects Kart45.5K views
Project-performance appraisal by abhisaxena
Project-performance appraisalProject-performance appraisal
Project-performance appraisal
abhisaxena59.7K views
Human Resource Management (in TATA Motors) by Urmilesh Tiwari
Human Resource Management (in TATA Motors)Human Resource Management (in TATA Motors)
Human Resource Management (in TATA Motors)
Urmilesh Tiwari39.3K views
training and development project IIPM by Susmitha Chowdary
training and development project IIPM training and development project IIPM
training and development project IIPM
Susmitha Chowdary6.8K views
HR PRACTICES OF TATA MOTORS-MALIKZADA RAASHID by Raashid Malik
HR PRACTICES OF TATA MOTORS-MALIKZADA RAASHIDHR PRACTICES OF TATA MOTORS-MALIKZADA RAASHID
HR PRACTICES OF TATA MOTORS-MALIKZADA RAASHID
Raashid Malik28.5K views

Viewers also liked

Project report on Performance Appraisal of BSNL by
Project report on Performance Appraisal of BSNLProject report on Performance Appraisal of BSNL
Project report on Performance Appraisal of BSNLVipul Sachan
137.2K views79 slides
Performance appraisal sample wording by
Performance appraisal sample wordingPerformance appraisal sample wording
Performance appraisal sample wordingalexsmith9114
34.4K views5 slides
Sample intern performance appraisal by
Sample intern performance appraisalSample intern performance appraisal
Sample intern performance appraisaledglarmohamed
81.5K views18 slides
performance appraisal reliance by
performance appraisal relianceperformance appraisal reliance
performance appraisal reliancepragati jain
28.2K views20 slides
Performance management and appraisal of Coca-cola by
Performance management and appraisal of Coca-colaPerformance management and appraisal of Coca-cola
Performance management and appraisal of Coca-colaLîãkàŧ LîkhõÑ বাংলাদেশী
131.8K views32 slides
Performance appraisal in wipro by
Performance appraisal in wiproPerformance appraisal in wipro
Performance appraisal in wiprobutterangela123
35.4K views5 slides

Viewers also liked(20)

Project report on Performance Appraisal of BSNL by Vipul Sachan
Project report on Performance Appraisal of BSNLProject report on Performance Appraisal of BSNL
Project report on Performance Appraisal of BSNL
Vipul Sachan137.2K views
Performance appraisal sample wording by alexsmith9114
Performance appraisal sample wordingPerformance appraisal sample wording
Performance appraisal sample wording
alexsmith911434.4K views
Sample intern performance appraisal by edglarmohamed
Sample intern performance appraisalSample intern performance appraisal
Sample intern performance appraisal
edglarmohamed81.5K views
performance appraisal reliance by pragati jain
performance appraisal relianceperformance appraisal reliance
performance appraisal reliance
pragati jain28.2K views
Performance appraisal in wipro by butterangela123
Performance appraisal in wiproPerformance appraisal in wipro
Performance appraisal in wipro
butterangela12335.4K views
Performance appraisal (mustaquim) by Sonu MustQm
Performance appraisal (mustaquim)Performance appraisal (mustaquim)
Performance appraisal (mustaquim)
Sonu MustQm1.1K views
Performance Appraisal ppt [hrm] by angel01021990
Performance Appraisal ppt [hrm]Performance Appraisal ppt [hrm]
Performance Appraisal ppt [hrm]
angel01021990455.2K views
Performance appraisal by Madhuri Bind
Performance appraisalPerformance appraisal
Performance appraisal
Madhuri Bind288.1K views
Summer internship project report by Manish Singh
Summer internship project reportSummer internship project report
Summer internship project report
Manish Singh461.6K views
Research paper on performance appraisal by marianelson0292
Research paper on performance appraisalResearch paper on performance appraisal
Research paper on performance appraisal
marianelson02923.3K views
Questionnaire of performance appraisal by davidmeteosramajo
Questionnaire of performance appraisalQuestionnaire of performance appraisal
Questionnaire of performance appraisal
davidmeteosramajo23.5K views
360 degree appraisal system by Akshay_Mugloo
360 degree appraisal system360 degree appraisal system
360 degree appraisal system
Akshay_Mugloo31.2K views
Project on maruti by sandy541989
Project on marutiProject on maruti
Project on maruti
sandy54198935.8K views
360 Degree Feedback PPT by msgexperts
360 Degree Feedback PPT360 Degree Feedback PPT
360 Degree Feedback PPT
msgexperts55.5K views
Performance Appraisal Effectiveness Techniques by Art Flores
Performance Appraisal Effectiveness TechniquesPerformance Appraisal Effectiveness Techniques
Performance Appraisal Effectiveness Techniques
Art Flores154.7K views

Similar to Internship report on Performance Appraisal in BMW

BAAP PPT BISWAJEET by
BAAP PPT BISWAJEETBAAP PPT BISWAJEET
BAAP PPT BISWAJEETBiswajeet Samal
172 views29 slides
An Assessment and Analysis of the Marketing Techniques and Strategies of BMW ... by
An Assessment and Analysis of the Marketing Techniques and Strategies of BMW ...An Assessment and Analysis of the Marketing Techniques and Strategies of BMW ...
An Assessment and Analysis of the Marketing Techniques and Strategies of BMW ...Siddharth Sinha
866 views15 slides
A research report on under performance of yamaha motor bikes in 100 150 cc ca... by
A research report on under performance of yamaha motor bikes in 100 150 cc ca...A research report on under performance of yamaha motor bikes in 100 150 cc ca...
A research report on under performance of yamaha motor bikes in 100 150 cc ca...Projects Kart
13.8K views40 slides
A project report on customer satisfaction at basaveshwara motors by
A project report on customer satisfaction at basaveshwara motorsA project report on customer satisfaction at basaveshwara motors
A project report on customer satisfaction at basaveshwara motorsBabasab Patil
3.8K views57 slides
193453 633789033767663750 by
193453 633789033767663750193453 633789033767663750
193453 633789033767663750sanjujain
2K views46 slides
Varun tonk project report by
Varun tonk  project reportVarun tonk  project report
Varun tonk project reportvarun tonk
161 views40 slides

Similar to Internship report on Performance Appraisal in BMW(20)

An Assessment and Analysis of the Marketing Techniques and Strategies of BMW ... by Siddharth Sinha
An Assessment and Analysis of the Marketing Techniques and Strategies of BMW ...An Assessment and Analysis of the Marketing Techniques and Strategies of BMW ...
An Assessment and Analysis of the Marketing Techniques and Strategies of BMW ...
Siddharth Sinha866 views
A research report on under performance of yamaha motor bikes in 100 150 cc ca... by Projects Kart
A research report on under performance of yamaha motor bikes in 100 150 cc ca...A research report on under performance of yamaha motor bikes in 100 150 cc ca...
A research report on under performance of yamaha motor bikes in 100 150 cc ca...
Projects Kart13.8K views
A project report on customer satisfaction at basaveshwara motors by Babasab Patil
A project report on customer satisfaction at basaveshwara motorsA project report on customer satisfaction at basaveshwara motors
A project report on customer satisfaction at basaveshwara motors
Babasab Patil3.8K views
193453 633789033767663750 by sanjujain
193453 633789033767663750193453 633789033767663750
193453 633789033767663750
sanjujain2K views
Varun tonk project report by varun tonk
Varun tonk  project reportVarun tonk  project report
Varun tonk project report
varun tonk161 views
VARUN TONKSummer internship project report 2016 by varun tonk
VARUN TONKSummer internship project report 2016VARUN TONKSummer internship project report 2016
VARUN TONKSummer internship project report 2016
varun tonk1.8K views
The International Expansion Of Bmw And Ikea by Brenda Higgins
The International Expansion Of Bmw And IkeaThe International Expansion Of Bmw And Ikea
The International Expansion Of Bmw And Ikea
Brenda Higgins3 views
A Study on Effectiveness of Various Sales Promotional Activities of Arpita Bajaj by Projects Kart
A Study on Effectiveness of Various Sales Promotional Activities of Arpita BajajA Study on Effectiveness of Various Sales Promotional Activities of Arpita Bajaj
A Study on Effectiveness of Various Sales Promotional Activities of Arpita Bajaj
Projects Kart15.6K views
Honda city by amit soni
Honda cityHonda city
Honda city
amit soni3.1K views
Consumer behavior towards bajaj pulsar 150 cc by Projects Kart
Consumer behavior towards bajaj pulsar 150 ccConsumer behavior towards bajaj pulsar 150 cc
Consumer behavior towards bajaj pulsar 150 cc
Projects Kart3.9K views
Brand management - "Lexus" by jitendrasangle
Brand management - "Lexus"Brand management - "Lexus"
Brand management - "Lexus"
jitendrasangle3.4K views
Project Report - Hero motocorp and bajaj pdf by Umang Maheshwari
Project Report - Hero motocorp and bajaj pdfProject Report - Hero motocorp and bajaj pdf
Project Report - Hero motocorp and bajaj pdf
Umang Maheshwari21.1K views
Mitsubishi motors corp by Abhay_018
Mitsubishi motors corpMitsubishi motors corp
Mitsubishi motors corp
Abhay_0182.3K views
Bmw slides powerpoint presentation by Shoaib Hossen
Bmw slides  powerpoint presentationBmw slides  powerpoint presentation
Bmw slides powerpoint presentation
Shoaib Hossen35.8K views
Hidden losses in industry by aditya singh
Hidden losses in industryHidden losses in industry
Hidden losses in industry
aditya singh724 views

Internship report on Performance Appraisal in BMW

  • 1. 1. INTRODUCTION 1.1 PERFORMANCE APPRAISAL Performance appraisal is the process of obtaining, analyzing and recording information about the relative worth of an employee. The focus of the performance appraisal is measuring and improving the actual performance of the employee and also the future potential of the employee. Its aim is to measure what an employee does. It is a powerful tool to calibrate, refine and reward the performance of the employee. It helps to analyze his achievements and evaluate his contribution towards the achievements of the overall organizational goals. By focusing the attention on performance, performance appraisal goes to the heart of personnel management and reflects the management's interest in the progress of the employees. 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. 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. Performance appraisal takes into account the past performance of the employees and focuses on the improvement of the future performance of the employees. 1.1.1 OBJECTIVES OF PERFORMANCE APPRAISAL: • To review the performance of the employees over a given period of time. • To judge the gap between the actual and the desired performance. • To help the management in exercising organizational control. 1
  • 2. • Helps to strengthen t h e relationship and communication between supervisor- subordinates and management-employees. • To diagnose the strengths and weaknesses of the individuals so as to identify t h e training and development needs of the future. • To provide feedback to the employees regarding their past performance. Provide information to assist in the other personal decisions in the organization. • Provide clarity of the expectations and responsibilities of the functions to be performed by the employees. • To judge the effectiveness of the other human resource functions of the organization such as recruitment, selection, training and development. • To reduce the grievances of the employees. If employee development is required for performance improvement then solving these performance problems should be straight forward with a clear understanding of root causes. Possible approaches include changing the work environment, better prioritization of conflicting priorities, time off, additional training, shadow or buddy system, mentoring or coaching, changing team environment or set objectives and soon. 1.2 INDUSTRY PROFILE 1.2.1 HISTORY The first practical automobile with a Petrol engine was built by Karl Benzin, 1885 in Mannheim, Germany. Benz was granted a patent for his automobile on 29 January 1886, and began the first production of automobiles in 1888 after Bertha Benz his wife had proved with the first long-distance trip in August 1888 from Mannheim to Pforzheim and back that the horseless coach was absolutely suitable for daily use. Since 2008 a Bertha Benz Memorial Route commemorates this event. Soon after, Gottlieb Daimler and Wilhelm Mabuchi in Stuttgart in 1889 designed a vehicle from scratch to be an automobile, rather than a horse-drawn carriage fitted with an engine. They are also usually credited as inventors of the first motorcycle in 1886, but Enrico Bernardio of the University of Padua in 1882, patented a 0.024 horsepower one-cylinder 2
  • 3. petrol motor fitting into his son’s tricycle making it at least a candidate for the first automobile, and first motorcycle. Bernardi enlarged the tricycle in 1892 to carry two adults. 1.2.2 AUTOMOTIVE INDUSTRY The automotive industry designs, develops, manufacturers, markets, and sells the world’s motor vehicles. In 2009, more than 88 million motor vehicles, including cars and commercial vehicles were produced worldwide. In 2009-2010, a total of 90 million new automobiles were sold worldwide: 24 million in Europe, 21.4 million in Asia-Pacific, 19.4 million in USA and Canada, 14.4 million in Latin America, 6.4 million the Middle East and 7.4 million in Africa. The markets in North America and Japan were stagnant, while those in South America and Asia grew strongly. Of the major markets, Russia, Brazil, India and China saw the most rapid growth. About 250 million vehicles are in the use in the United States. Around the world, there were about 806 million cars and light trucks on the road in 2009: they burn over 260 billion gallons of gasoline and diesel fuel yearly. The numbers are increasing rapidly, especially in China and India. In the opinion of some, urban transport systems based around the car have proved unsustainable, consuming excessive energy, affecting the health of populations, and delivering a declining level of service despite increasing investments. Many of these negative impacts fall disproportionately on those social groups who are also least likely to own and drive cars. The sustainable transport movement focuses on solutions to these problems. In 2009, with rapidly rising oil prices, industries such as the automotive industry, are experiencing combination of pricing pressures from raw material costs and changes in consumer buying habits. The industry is also facing increasing external competition from the public transport sector, as consumers re-evaluate the private vehicle usage. Roughly half of the US’s fifty one light vehicle plants are projected to permanently close in the coming years with the loss of another 200,000 jobs in the sector, on top of the 560,000 jobs lost this decade. As a result, in 2010, China became the largest automobile markets in the world. 3
  • 4. 1.3 INTRODUCTION OF THE COMPANY BMW is an acronym for Bayerische Motoren Werke AG--or, in English, Bavarian Motor Works. Whatever you call it, the German-based company is one of the world's most respected automakers, renowned for crafting luxury cars and SUVs that offer superior levels of driving enjoyment. Founded in Munich, the company began in the early 1910s as an aircraft manufacturer. BMW's current logo, designed to represent white propeller blades against a blue sky, reflects these origins; its blue-and-white color scheme also references Bavaria's blue-and-white checkered flag. It wasn't until 1928 that production began on the first BMW automobile, the Dixi. The car proved tremendously popular, and its success helped the manufacturer weather the Depression. BMW's best-known pre-World War II vehicle was the Type 328 roadster, a supple two-seater that racked up over 120 victories on the motorsport circuit between 1936 and 1940. Postwar BMW cars maintained this tradition, winning several racing, rallying and hill climb victories. The early 1950s saw the launch of the BMW 501, a roomy, voluptuous sedan that was M resplendent with all of the hopefulness of that era. It was soon followed by the 502 which was powered by the world's first light-alloy V8, foreshadowing BMW's ongoing commitment to developing new technology. The best-selling BMW of that decade was the Isetta, a petite two-seat "micro car" typically powered by a 12- or 13-horsepower engine. The mid-'50s also saw the debut of the limited production and breathtakingly beautiful 507 sports car which had an alloy body and used the 502's V8 for propulsion. In the 1960s, BMW sales strengthened significantly, thanks in part to the immense popularity of the 1500, a sporty family sedan. By the 1970s, BMW was establishing itself as a full-fledged car company. It was a pioneer for many emerging technologies, including turbo charging and advanced vehicle electronics. This was also the period when BMW of North America was established and consumers, who coveted both sports and luxury cars, became loyal "Bimmer" owners. The '70salso saw the birth of BMW's three-tier sport sedan range consisting of the 3 Series, 5 Series and7 Series cars and the creation of its performance division. More recently, the company has been expanding its reach worldwide. It opened its first U.S. manufacturing plant in the latter half of the 1990s and has expanded its brand empire to include Mini and 4
  • 5. Rolls-Royce. BMW also continues to build motorcycles, something it has done since the 1920s. The automaker's famous advertising slogan describes each of its vehicles as "the ultimate driving machine," and it's not mere hyperbole. Over the past couple of decades, BMWs have become the standard for performance and luxury in most of the "over $30,000" segments. With family-friendly wagons, crisp sedans, distinctive coupes, nimble sports cars and spacious SUVs offered, BMW's model roster is diverse. But its luxury vehicles all share a common characteristic: the ability to make drivers feel gloriously connected to the road. 1.3.1 ORGANIZATION CHART TN-436 General Manager Human Resources Subash Chander Ganapathy TN-436 Team Assistant Bavya TN-436 TN-436 Manager Specialist Human Resources EMS, Facilities and Project R. Govardhanan M.Ramakrishnan TN-436 TN-436 Specialist Safety Facilities & Projects Sathish Naresh TN-436 Recruitment , Trainng and PMS TN-436 Saranya Facilities Balasubramaniyan TN-436 Employee Relation TN-436 Shanmugarajan Projects Damodharan TN-436 Expat Marrion TN-436 Employee Relation (EWH & Other Functions) Balakrishnan 5
  • 6. 1.3.2 VARIOUS DEPARTMENTS ASSEMBLY Starting from car body delivery from logistics to completion of entire car comes under this department. It consists of process of assembling car parts. This includes various sub-departments like Overhead, Door, Paint Shop, Final Flash, Finish Rework, Repair On Wheels and Trimline. PLANT MANAGEMENT This is the finance department of the company which sources and allocates the funds for continuous production. All necessary goods for employees are purchased through this department. They provide the sales and expenditure details. HUMAN RESOURCE AND FACILITY This department serves as the bridge between the management and workforce. Various tasks like filing of employee records, payroll distribution, tax filing, attendance, assigning loss of pay etc. Facility department takes care of the plant maintenance. It includes infrastructure facility like housekeeping, gardening, waste management and security etc. INFORMATION TECHNOLOGY DEPARTMENT This department takes care of network and communication facility of company. It controls the inflow and outflow of data from company and outside world through computers and internet security. 1.4 INTRODUCTION OF THE SUBJECT Performance appraisal may be defined as an organized formal interaction between a subordinate and supervisor, that usually takes the form of a periodic interview, in which the work performance of the subordinate is examined and discussed, for identifying weaknesses and strengths as well as opportunities for improvement and skills development (Archer 6
  • 7. North, 2002). In other words, Performance appraisal is a formal system of measuring, evaluating, and influencing an employee’s job-related attributes, behaviors and outcomes to determine how productive an employee is, and to determine if an employee’s productivity can be improved (Konobear, 2002). Appraisal results are used in many organizations, either directly or indirectly, to help identifying the better performing employees who should get the majority of available merit pay increases, bonuses, and promotions. There are various appraisal methods are in usage today. Broadly, we can classify them as comparative appraisals (ranking, paired comparisons, and forced distribution), behavioral appraisals (graphic rating scales, checklist, critical incidents, essays, and behaviorally anchored rating scales), and output based appraisals. Also there are rapid appraisal methods for quick, low cost ways to gather data for manager’s information needs. All of the appraisal methods have been discussed and their advantages and disadvantages are mentioned. In this paper a new appraisal method has been proposed using the existing methods. This new method is developed by taking the advantages of the three common methods including comparative, behavioral and output based. The advantages and disadvantages of this new method are also discussed. A hierarchical structure discussed in this paper uses all the appraisal methods accordingly at appropriate levels of the company. 1.4.1 METHODS FOR APPRAISING PERFORMANCE Performance actually can be appraised by a wide variety of methods and techniques. The most commonly used performance appraisal methods can be distinguished into three major categories: comparative appraisals, behavioral appraisals, and output-based appraisals. 1.4.1.1 Comparative Appraisals Managers directly compare the performance of their subordinates against one another in comparative appraisals. For example, a data entry operator's performance would be compared with that of other data-entry operators by the computing supervisor. Comparative techniques include ranking, paired comparisons, and forced distribution. 7
  • 8. Ranking: In this method, the supervisor lists all subordinates in order, from the highest to the lowest in performance. Rankings such as this are appropriate only in small companies. As the number of employees increases, it becomes gradually more difficult to discern differences in their performance. Paired Comparisons: The paired comparison method involves comparing each employee to every other employee in the rating group, one at a time, to determine the better. A rank order is obtained by counting the number of times each individual is selected as being the better of a pair. Forced Distribution: In forced distribution, the supervisor must assign only a certain proportion of his/her subordinates to each of several categories on each evaluative factor. A common forced distribution scale is divided into five categories. A fixed percentage of all subordinates in the group fall within each of these categories. Typically, the distribution follows a normal distribution. 1.4.1.2 Behavioral Appraisals In contrast with comparative appraisals, behavioral appraisals allow supervisors to evaluate each person's performance independent of other employees but relative to important job-related behaviors, which when exhibited can lead to job success. Graphic Rating Scale: The graphic rating scale allows the rater to mark an employee's job performance on a five-point or seven-point scale. This method identifies certain subjective character traits, such as 'pleasant personality', 'initiative' or 'creativity' to be used as basic job performance criteria. Because of its simplicity, the graphic rating scale is the most frequently used performance appraisal method. Checklist: The checklist uses a list of statements or words that are checked by raters. Raters check statements most representative of the characteristics and performance of an employee. Typical checklist statements are: can be expected to finish working time, seldom agrees to work overtime, is cooperative and helpful, accepts criticism, and strives for self- improvement. The checklist can be modified so that varying weights are assigned to the 8
  • 9. statements or words. The results can then be quantified. Usually, the results are not known by the rater and are tabulated by someone else, such as a member of the HR unit. Critical Incidents: In the critical incident method, the manager keeps a written record of the highly favorable and unfavorable actions in an employee's performance. When something happens [a 'critical incident' involving a particular employee] the manager writes it down. Thus, a list of critical incidents is kept during the entire rating period for each employee. The critical incident method can be used with other methods to document the reasons why an employee was rated in a certain way. Essays: The essay (free-form) appraisal method requires the manager to write a short essay describing each employee's performance during the rating period. The rater usually is given a few general headings under which to categorize comments. The intent is to allow the rater more flexibility than other methods do. As a result, the method is often combined with other methods. Behaviorally Anchored Rating Scales (BARS): BARS utilize critical incidents to focus appraisal on employee behaviors that can be changed. Thus, a BARS system describes examples of 'good' or 'bad' behavior. These examples are 'anchored', or measured, against a scale of performance levels. An example of BARS that rates a university professor's attitude toward students is sited here. Construction of BARS begins with the identification of important job dimensions. The dimensions are the most important performance factors in an employee's description. Assume the major job dimensions associated with teaching are: course organization, attitude toward students, fair treatment, and competence in subject area. Short statements, similar to critical incidents, are developed that describe both desirable and undesirable behaviors. Then they are 'retranslated' or assigned to one of the job dimensions. This task is usually a group project and assignment to a dimension usually requires the agreement of 60% to 70% of the group. The group, consisting of people familiar with the job, then assigns each 'anchor' a number, which represents how 'good' or 'bad' the behavior is. When numbered, these anchors are fitted to a scale. The drawbacks are: behaviorally anchored rating scales require extensive time and effort to develop and maintain. Also, 9
  • 10. separate BARS forms are necessary to accommodate different types of jobs in an organization. 360 Degree Appraisal system: In human resources or industrial psychology, 360-degree feedback, also known as multi-rater feedback, multi source feedback, or multi source assessment, is feedback that comes from members of an employee's immediate work circle. Most often, 360-degree feedback will include direct feedback from an employee's subordinates, peers, and supervisor(s), as well as a self-evaluation. It can also include, in some cases, feedback from external sources, such as customers and suppliers or other interested stakeholders. It may be contrasted with "upward feedback," where managers are given feedback only by their direct reports, or a "traditional performance appraisal," where the employees are most often reviewed only by their managers. 1.4.1.3 Output-based Appraisals While the methods described above focus on job behaviors or processes, output-based appraisals focus on job products as the primary criteria. The most commonly used output- based appraisal is Management-by-Objectives (MBO). MBO specifies the performance goals that an individual hopes to attain within an appropriate length of time. The objectives that each manager sets are derived from the overall goals and objectives of the organization. Implementing an MBO appraisal system comprised four basic stages. Job Review and Agreement: In the first phase the employee and the supervisor review the job description and the key activities that comprise the employee's job. The idea is to agree on the exact makeup of the employee's job. Development of Performance Standards: Specific standards of performance must be mutually developed. This phase specifies a satisfactory level of performance that is specific and measurable. Guided Objective Setting: Objectives are established by the employee in conjunction with, and guided by, the supervisor. Objectives should be realistically attainable and may be different from the set performance standard. 10
  • 11. Continuing Performance Discussions: The employee and the supervisor use the objectives as bases for continuing discussions about the employee's performance. Although a formal review session may be scheduled, the employee and the manager do not necessarily wait until the appointed time for performance discussion. Objectives are modified mutually, and progress is discussed during the period. 11
  • 12. 2. NEED, OBJECTIVE AND SCOPE OF THE STUDY 2.1 NEED FOR THE STUDY Automobile has become important need of people in their fast moving life. These automobile companies are expanding in greater phase in various countries especially in highly populated countries like India, China etc. These Companies are also contributing towards the development of economy for a long time and at the moment it is treated as an important industry in modern world. Due to globalization and free market economy, this industry is facing severe competition, also it makes establishment of foreign company in other countries. Most of the automotive companies fail due to lack of proper strategic planning and goals. One of the major reasons of their poor performance is adaptation of traditional production system. They are very much slow in adopting new product line, less concerned about attracting and satisfying customers and being reluctant to implement information technology. That’s why it is very necessary for each and every industry to evaluate its performance over the periods. Thus the purposes of choosing the topic are, • I feel that performance appraisal of employees will result in better productivity. • For the better understanding of the concept of performance appraisal. • To provide feedback on appraisal system of the company for further improvement of the system. 2.2 OBJECTIVE OF THE STUDY 2.2.1 Primary Objective: • To study the performance appraisal of employees at BMW Group Chennai. 12
  • 13. 2.2.2 Secondary Objective: • To study the purpose of performance appraisal conducted at BMW. • To understand the opinion of employees towards performance appraisal at BMW. • To identity the effect of performance appraisal on individual and organizational development. • To understand the existing relationship between management and employees. • To identify ways to improve the existing performance appraisal system. 2.3 SCOPE OF THE STUDY • The management can identify the employee's opinion of the existing performance appraisal system. • The study can be used to make the present appraisal system more effective and satisfied among employees. • It could be used to identify training and development needs for the individual and the organization as a whole 2.4 LIMITATIONS OF THE STUDY Production is, in fact, a huge operation and it is quite impossible to cope up all the activities during internship period. And for that reason limitations prevail while conducting the survey. Basic limitations faced while preparing the study were: • The Company’s policy of not disclosing some data and information for obvious reasons, which would have been very much useful for the report. • Some of the questionnaires were incomplete. • Few employees sometime felt disturbed, as they were busy in their job. • Sometimes it was difficult to collect data from their files, because important files are kept in volt for safety. • It is difficult to make information based a rich report in short time of period. • This report was prepared in short time. 13
  • 14. 3. LITERATURE REVIEW 3.1 PERFORMANCE APPRAISAL Performance appraisal is one of the most important requirements for all successful business and human resource policy (Kressler, 2003). Rewarding and promoting effective performance in organization, as well as identifying ineffective performers for resource management (Pulakos, 2003). The ability to conduct performance appraisal relies on the ability to assess an employee's performance in a fair and accurate manner. Evaluating employee performance is a difficult task. Once the supervisor understands the nature of the job and the source of information, the information needs to be collected in a systematic way, provided as feedback, and integrated into the organization's performance management processor use in making compensation, job placement and training decisions and assignment (London, 2003). Performance evaluations have been conducted since the times of Aristotle (Landy, Zedeck, Cleveland, 1983). The earliest formal employee performance evaluation program is thought to have originated in the United States military establishment shortly after the birth of the republic (Lopez,1968). The measurement of an employee's performance allows for rational administrative decisions at the individual employee level. It also provides for the raw data for the evaluation of the effectiveness of such personnel-system components and processes as recruiting policies, training programs, selection rules, promotional strategies, and reward allocations (Landy, Zedeck, Cleveland, 1983).In addition, it provides the foundation for behaviorally based employee counseling. In the counseling setting, performance information provides the vehicle for increasing satisfaction, commitment, and motivation of the employee. Performance measurement allows the organization to tell the employee something about their rates of growth, their competencies, and their potentials. There is little disagreement that if well done, performance measurements and feedback can play a valuable role in effecting the organization (Landy, Zedeck, Cleveland, 1983). 14
  • 15. 3.2 BASIC PURPOSE Performance appraisals should focus on three objectives: performance, not personalities; valid, concrete, relevant issues, rather that subjective emotions and feelings; reaching agreement on what the employee is going to improve in his performance and what you are going to do (MeKirehy,1998). Both the supervisor and employee should recognize that a strong relationship exists between training and performance evaluation (Barr, 1993). Each employee should be allowed to participate in periodic sessions to review performance and clarify expectations. Both the supervisor and the employee should recognize these sessions as constructive occasions for two-way should include opportunities for self- assessment as well as supervisor feedback. The supervisor should keep in contact with the employee to assure the training experiences are producing desired impact (Barr, 1993). A portion of the process should be devoted to an examination of potential opportunities to pursue advancement of acceptance of more complex responsibilities. The employee development goals should be recognized as legitimate, and plans should be made to reach the goals through developmental experiences or education (Barr, 1993). Encouraging development is not only a supervisor's professional responsibility, but it also motivates an employee to pursue additional commitments. In addition, the pursuit of these objectives will also improve the prospect that current employees will be qualified as candidates when positions become available. This approach not only motivates current performance but also assists the recruitment of current employees as qualified candidates for future positions (Barr, 1993). 3.3 BENEFITS OF PRODUCTIVE PERFORMANCE APPRAISALS Employee learns of his or her own strengths in addition to weaknesses. New goal and objectives are agreed upon. Employee is an active participant in the evaluation process. The relationship between supervisor and employees is taken to an adult-to-adult level. Work teams may be restructured for maximum efficiency. Employee renews his or her interest in being a part of the organization now and in the future. Training needs are identified. Time is devoted to discussing quality of work without regard to money issues. 15
  • 16. Supervisor becomes more comfortable in reviewing the performance of employees. Employees feel that they are taken seriously as individuals and that the supervisor is truly concerned about their needs and goals. (Randi, Toler, Sachs, 1992). 3.4 PITFALLS TO AVOID When conducting performance appraisals on any level, it is important to keep in mind the common pitfalls to avoid. These pitfalls may include but are not limited to: 1. Bias/prejudice-Race, religion, education, family background, age, and/or sex. 2. Trait assessment-Too much attention to characteristics that have nothing to do with the job is difficult to measure. 3. Over-emphasis on favorable or unfavorable performance of one or two tasks which could lead to an unbalanced evaluation of the overall contribution. 4. Relying on impressions rather than facts. 5. Holding the employee responsible for the impact of factors beyond his/her control. 6. Failure to provide each employee with an opportunity for advance preparation (Maddux,1993). 3.5 LEGAL IMPLICATIONS Any performance appraisal system used to make employment decisions about a member of a protected class (i.e. Based on age, race, religion, gender or national origin) must be a valid system (an accurate measure of performance associated with job requirements. Other it can be challenged in the courts based on Title VII of the 1964, Civil Rights Act, the Civil Rights Act of 1991 and the Age Discrimination in Employment Act of 1975 (London, 2003). Effectiveness of performance Appraisal system it is argued is a function of applying the right system in right context. –By Klein; the Art of Appraisal. Performance appraisal system are "homework" that provides the information you need in order to make appropriate administrative recommendations, hold meaningful 16
  • 17. feedback discussions with staff members, and determined were performance improvement is required. - By Marion E. Haynes; Managing Performance. The effectiveness of an Appraisal System is determined by the quality of communication between the manager and staff member, not by multiple raters, complex scoring methods, or the form used.-By John D. Drake; Performance Appraisal. One More Time Performance appraisal can actually be counter-productive for employees who are in the greatest need of training and further development.-By Victor Buzzottan; improving your Performance Appraisal. One of the measure reason Performance management and Performance Appraisal fail is that too much time is spent on Appraising performance using vague criteria and not enough time and effort put into helping employee understands what his job is about, and the goals and objectives he/she is expected to achieve to be successful. Learn to do goals setting painlessly. – By Robert Dacal; Learn to plan Performance and set employee goals. Maximizing and measuring our own performance and that of the people who work for us is a basic tenant of the work environment. Always use of simple too land approach that can be beneficial in achievement performance plan.-By Zack Mansdorf; Performance Management; Identifying work goals. Most managers and supervisors today are attempting to quantify their departmental objective and pass them on their employees through performance standards. Despite the simplicity of this management-by-objective approach, deadlines are missed, quality is relatively poor and productive is low. The reasons for this may not be the fault of the employees carrying out the work. The cause is most often associated with the immediate supervisor's lack of attention to the realities surrounding objectives and performance standards require a careful analysis of all the relevant issues. –By Gregory Isaac; Plan for performance. Organizations striving to develop an open and participative approach have begun to give employees the chance to say what they think of their managers. Such appraisals can only work in a culture where mangers are willing to listen and learn and effect any necessary changes as a result. - By Madhukar Shukla; Upward Appraisal and Organizational culture. 17
  • 18. A tone stage performance appraisal relied mainly on personality characteristics. Subordinates were being appraised by their superior on the extent to which they exhibited characteristic like, tact, willingness, enthusiasm, and maturity. Mangers were being put into position of psychologists and required to make subjective ratings without any point of reference expect their own opinion. –By Bob Nelson; Performance Assessment. Performance appraisal is a part of overall performance management system of an organization. Through the appraisal process, gap between an individual's agreed performance standard his actual performance is assessed and appropriate strategies are drawn for subsequent performance cycle. This is a useful performance enhancement exercise. In many Organizations, PMS is linked with other systems like salary &Benefits, Training & Development and Succession Planning. - By H. K. Shukla; Striates Human Resource Management. 18
  • 19. 4. RESEARCH METHODOLOGY Research in common parlance refers to search for knowledge. Redman and Mory define research as a “Systematized effort to gain new knowledge. Research is an academic activity and such the term should be used in technical sense. According to Clifford Woody, Research comprises defining and redefining problem, formulating hypothesis or suggested solutions; collecting, organizing and evaluating data; making deductions and research conclusions; and at last carefully testing the conclusions to determine whether they fit the formulating hypothesis. Research is thus an original contribution to the existing stock of knowledge making for its advertisement. It is pursuit of truth with the help of study, observation, comparison and experiment. In short the search for knowledge through objective and systematic method of finding solution to problem is research. 4.1 RESEARCH DESIGN A Research design is the arrangement of conditions for collection and analysis of data in a manner that aims to combine relevance to the Research purpose with economy in procedure. In fact the Research design is the conceptual structure within which Research is conducted: it constitutes the blueprint for the collection measurement and analysis of data. It must be able to define clearly what they want to measure and must find adequate methods for measuring it along with a clear cut definition of population wants to study. Since the aim is to obtain complete and accurate information in these studies, the procedure to be used must be carefully planned. The research design must make enough provision for protection against bias and must maximize reliability with due concern for the economical completion of the search study. Descriptive research is adopted for this study. It includes surveys and fact finding enquires of different kinds. The major purpose of descriptive research is description of the state affairs as it exists at present. The main characteristic of this method is that the 19
  • 20. researcher has no control over the variables. He can only report what has happened or what is happened. 4.2 SAMPLING DESIGN A sample design is a definite plan for obtaining a sample from the sampling frame, it refers to the technique or procedure the researcher would adopt in selecting some sampling units from which interferences about the population is drawn. Sampling type used is Simple Random sampling technique. 4.2.1 POPULATION AND SAMPLE SIZE A decision has to be taken concerning sampling unit before selecting sample. The population for this study includes the employees from three branches of BMW group. The total population of BMW group is 800. 100 employees were undertaken for the study. 4.3 DATA COLLECTIONS For achieving the specific objectives of this study, data were gathered from both primary and secondary sources. 4.3.1 Primary Sources • Direct conversation with the respective officers of the Departments. • Face to face conversation with the employees. • Employee’s opinion collected through Questions. • Observation of HR activities. 4.3.2 Secondary Sources: • Various records of the Company. • Different Types of system information. • Website of BMW Group. • Different newsletters. • Annual Performance Appraisal Form of company. • Personal files of employees. 20
  • 21. 4.4 STATISTICALTOOLS  Chi-square test  Percentage analysis 4.4.1 CHI-SQUARE TEST The Chi-square test is an important test amongst the several tests of significance developed b y statisticians. Chi-square is a statistical measure used in the context of sampling analysis for comparing a variance to a theoretical variance. As a non-parametric test, it can be used to determine if categorical data shows dependency or the two classifications are independent. The test is, in fact, a technique through the use of which it is possible for all researchers to i. Test the goodness of fit ii. Test the significance of association between two attributes and iii. Test the homogeneity or the significance of population variance. As a test of independence, test enables us to explain whether or not two attributes are associated. In such a situation, we proceed with the null hypothesis that the two attributes are independent. If the calculated value is less than the tabulated value at certain degrees of freedom, the null hypothesis is accepted and vice versa. is calculated as follows: = ∑ (O-E) 2 E Where = Chi-Square Oi = Observed Frequency Ei = Expected Frequency is always positive. 21
  • 22. The expected value for the contingency tabulated as follows. E= (Row total*Column total) Grand total The test depends on the set of observed and expected values and on the degrees of freedom. The distribution is the limiting approximation designation. 4.4.2 PERCENTAGE ANALYSIS It refers to a special kind of ratio. Percentage is used in making comparison between two or more series of data; percentages are used to determine relationship between the series if data finding the relative differences becomes easier through percentage. It is expressed as, Percentage (%) = No. of respondents x 100 Total no. of respondents 22
  • 23. 5. DATA ANALYSIS AND INTERPRETATION 5.1 GENDER WISE CLASSIFICATION OF RESPONDENTS TABLE 5.1 GENDER WISE CLASSIFICATION OF RESPONDENTS Gender No. of respondents Percentage (%) Male 89 89 Female 11 11 Total 100 100 Source: Primary Data INTERPRETATION: From the above table, it can be inferred that 89% of the respondents are male and 11% of the respondents are female. FIGURE 5.1 GENDER WISE CLASSIFICATION OF RESPONDENTS 23
  • 24. 5.2 AGE WISE CLASSIFICATION OF RESPONDENTS TABLE 5.2 AGE WISE CLASSIFICATION OF RESPONDENTS Age No. Of Respondents Percentage (%) 20-25Age 25 25 30-35Age 33 33 40-45Age 30 30 Above-45Age 12 12 Total 100 100 Source: Primary Data INTERPRETATION: From the above table, it can be inferred that 33% of the respondents are in the age of 30-35, 30% of the respondents are in the age of 40-45, 25% of the respondents are in the age of 20-25 and 12% of the respondents are in the age above 45. FIGURE 5.2 AGE WISE CLASSIFICATION OF RESPONDENTS 24
  • 25. 5.3 EXPERIENCE WISE CLASSIFICATION OF RESPONDENTS TABLE 5.3 EXPERIENCE WISE CLASSIFICATION OF RESPONDENTS Experience No. Of Respondents Percentage (%) Below 5Years 28 28 5-lO Years 54 54 10-15 Years 18 18 Above15Years - - Total 100 100% Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 54% of the respondents are having 5-10years experience persons, 28% of the respondents have below 5Years of experience persons, 18% of the respondents are having 10-15years of experience and no respondents have experience more than 15years. FIGURE 5.3 EXPERIENCE WISE CLASSIFICATION OF RESPONDENTS 25
  • 26. 5.4 EDUCATIONAL QUALIFICATIONS OF RESPONDENTS TABLE 5.4 EDUCATIONAL QUALIFICATIONS OF RESPONDENTS Educational Qualification No. Of Respondents Percentage (%) UG degree 49 49 PG degree 19 19 Engineering 04 04 Other ITI 28 28 Total 100 100% Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 49% of the respondents are UG degree holders, 28% of the respondents are some others (ITI), 19% of respondents are PG degree holders and 4% of the respondents are engineering graduates. FIGURE 5.4 EDUCATIONAL QUALIFICATIONS OF RESPONDENTS 26
  • 27. 5.5 FREQUENCY OF PERFORMANCE APPRAISAL TABLE 5.5 FREQUENCY OF PERFORMANCE APPRAISAL Performance Appraisal No. of respondents Percentage (%) Once a Year 100 100 Twice a Year - - No Specific Time - - Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 100% of the respondents agree that performance appraisal is conducting once a year. 5.6 REASON FOR CONDUTING PERFORMANCE APPRISAL TABLE 5.6 REASON FOR CONDUTING PERFORMANCE APPRISAL Performance Appraisal No. of respondents Percentage (%) Conducting To identity motivating methods - - To decide monetary benefits - - Identifying barriers of - - performance All of the above 100 100 Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 100% of the respondent's agree that the reason for conducting performance appraisal includes all the factors such as to identity motivating methods, to decide monetary benefits and identity barriers for performance. 27
  • 28. 5.7 DURATION OF PERFORMANCE APPRAISAL CONDUCTED TABLE 5.7 DURATION OF PERFORMANCE APPRAISAL CONDUCTED When Performance No. of respondents Percentage (%) Appraisal conducted During working hours 87 87 During non-working hours 13 13 Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that for 87% of the respondents' performance appraisal is conducted during working hours and for 13% respondents' performance appraisal is conducted during non-working hours. FIGURE 5.7 DURATION OF PERFORMANCE APPRAISAL CONDUCTED 28
  • 29. 5.8 WHO CONDUCT PERFORMANCE APPRAISAL TABLE 5.8 WHO CONDUCT PERFORMANCE APPRAISAL Who Conducts No. Of Respondents Percentage (%) Performance appraisal Superior - - Peers - - Everyone - - Outsider 100 100 Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that for 100% of the respondents’ performance appraisal is conducted by outsiders. 5.9 REASONS FOR PERFORMANCE APPRAISAL DISCUSSED TABLE 5.9 REASONS FOR PERFORMANCE APPRAISAL DISCUSSED Informed reason for Performance appraisal No. Of Respondents Percentage (%) conducting Always 20 20 Sometimes 77 77 Never 03 03 Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 77% of respondents feel that the reason for performance appraisal is discussed sometimes, 20% of the respondent's feel it is discussed always and 3% of respondents say reason is never discussed. 29
  • 30. FIGURE 5.9 REASONS FOR PERFORMANCE APPRAISAL DISCUSSED 5.10 EMPLOYEE PERFORMANCES DISCUSSED TABLE 5.10 EMPLOYEE PERFORMANCES DISCUSSED Meetings of No. Of Respondents Percentage (%) Employee performance Nil - - Once 100 100 Twice - - Thrice - - Total 100 100% Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that for 100% of the respondents meeting on performance is conducting once a year. 30
  • 31. 5.11 PERFORMANCE APPRAISAL PROGRAMS RELATED WITH ORGANIZATIONAL GOALS TABLE 5.11 PERFORMANCE APPRAISAL PROGRAMS RELATED WITH ORGANIZATIONAL GOALS Goals No. Of Respondents Percentage (%) To a high extent 12 12 To some extent 69 69 To a low extent 19 19 Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 69% of the respondents feel the performance appraisal relates to some extent to organization goals, 19% feel to a low extent and12% feel to a high extent it relates. FIGURE 5.11 PERFORMANCE APPRAISAL PROGRAMS RELATED WITH ORGANIZATIONAL GOALS 31
  • 32. 5.12 1NVOLVEMENT IN DESIGNING APPRAISAL SYSTEM TABLE 5.12 INVOLVEMENT IN DESIGNING APPRAISAL SYSTEM Opinion No. of Respondents Percentage (%) Always - - Sometimes - - Never 100 100 Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 100% of the respondents say they are never involved in designing the appraisal system. 5.13 PERFORMANCE APPRAISAL RELEVANCE TO EMPLOYEE JOB TABLE 5.13 PERFORMANCE APPRAISAL RELEVANCE TO EMPLOYEE JOB S. No Relevance No. Of Respondents Percentage (%) 1 Highly relevant 87 87 2 Relevant 13 13 3 No idea - - 4 Irrelevant - - 5 Highly irrelevant - - Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 87% of the respondents feel that performance appraisal is highly relevant to employee job and 13% feel it is relevant. 32
  • 33. FIGURE 5.13 PERFORMANCE APPRAISAL RELEVANCE TO EMPLOYEE JOB 5.14 OPINION AND SUGGESTIONS SHARED TO MANAGERS TABLE 5.14 OPINION AND SUGGESTIONS SHARED TO MANAGERS Opinion and Suggestions No. of Respondents Percentage (%) Mostly 100 100 Rarely - - Never - - Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 100% of the respondents mostly share their opinion and suggestions to their managers. 33
  • 34. 5.15 TRAINING OF FILL UP PERFORMANCE APPRAISAL FORM TABLE 5.15 TRAINING OF FILL UP PERFORMANCE APPRAISAL FORM Forms No. of respondents Percentage Yes 100 100 No - - Total 100 100% Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 100% of the respondents are given training to fill the appraisal form. 5.16 APPRAISER'S AWARENESS ON EMPLOYEE JOB RESPONSIBLITIES AND DUTIES TABLE 5.16 APPRAISER'S AWARENESS ON EMPLOYEE JOB RESPONSIBLITIES AND DUTIES Aware No. of respondents Percentage (%) Completely Aware - - Aware to an extent - - Not Aware 100 100 Total 100 100% Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 100% of the respondents feel that the appraiser is not aware of their job responsibilities and duties. 34
  • 35. 5.17 FEEDBACKS PROVIDED FOR PERFORMANCE IMPROVEMENT TABLE 5.17 FEEDBACKS PROVIDED FOR PERFORMANCE IMPROVEMENT Aware No. of respondents Percentage (%) Frequently 89 89 Occasionally 11 11 Never - - Total 100 100% Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 89% of the respondents feel that feedback is provided occasionally whereas 11% feel that feedback is provided frequently. FIGURE 5.17 FEEDBACKS PROVIDED FOR PERFORMANCE IMPROVEMENT 35
  • 36. 5.18 INVOLVEMENT OF RATER TABLE 5.18 INVOLVEMENT OF RATER Involvement No. of respondents Percentage (%) Highly involved 34 34 Less involved 40 40 Not involved 26 26 Total 100 100% Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 44% of the respondents feel the rater is less involved, 34% of the respondents feel they are highly involved and 26% of the respondents are not involved. 5.19 PROPER EXECUTION OF PERFORMANCE APPRAISAL TABLE 5.19 PROPER EXECUTION OF PERFORMANCE APPRAISAL Properly executed in your organization No. Of Respondents Percentage (%) Yes 78 78 No 22 22 Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 78% of the respondents feel performance appraisal is properly executed while 22% feel it is not properly executed. 36
  • 37. FIGURE 5.19 PROPER EXECUTION OF PERFORMANCE APPRAISAL 5.20 UPDATING OF PERFORMANCE APPRAISAL TABLE 5.20 UPDATING OF PERFORMANCE APPRAISAL Reviewed and updated No. Of Respondents Percentage (%) Frequently 46 46 Occasionally 54 54 Never - - Total 100 100 Sources: Primary Data INTERPRETATION: From the above table, it can be inferred that 54% of the respondents feel the performance appraisal is reviewed occasionally while 46% of respondents feel they are reviewed frequently. 37
  • 38. FIGURE 5.20 UPDATING OF PERFORMANCE APPRAISAL 5.21 STATISTICAL ANALYSIS 5.21.1 CHI-SQUARE TEST TABLE 5.21.1 CROSS TABULATION BETWEEN THE CHANGES TAKEN FOR PERFORMANCE APPRAISAL AND IMPROVEMENT OF PERFORMANCE APPRAISAL. Improvement in Highly In Highly Effective Moderate Total Overall effective Effective ineffective PA Change in motivating 7 5 9 12 0 33 strategy Re-structuring of organization 12 2 6 3 2 25 or individual objectives 38
  • 39. Improvement in Management 11 8 0 6 0 25 employment relationship Making changes in 4 1 0 4 8 17 dissatisfied areas No decision 0 0 0 0 0 0 taken Total 34 16 15 25 10 100 STEP 1: SETTING AN HYPOTHESIS H0: There is no significant relationship between the changes taken for performance appraisal and improvement of performance appraisal. H1: There is significant relationship between the changes taken for performance appraisal and improvement of performance appraisal. STEP 2: TO FIND THE EXPECTED FREQUENCY Expected frequency = Corresponding row total * Corresponding column total Total number of samples STEP 3: CALCULATION OF CHI-SQUARE VALUE Formula: =∑ (O-E) 2 E Where = Chi-Square Oi = Observed Frequency Ei = Expected Frequency 39
  • 40. TABLE 5.21.1.1 COMPUTATION TABLE FOR O E (O-E) (O-E)2 (O-E)2/E 7 11.22 -4.22 17.81 1.59 5 5.28 -0.28 0.08 0.01 9 4.95 4.05 16.40 3.31 12 8.25 3.75 14.01 1.70 0 3.30 -3.30 10.8 3.30 12 8.50 3.50 12.25 1.44 2 4.00 -2.00 4.00 1.00 6 3.75 2.25 5.0 1.35 3 6.25 -3.25 10.5 1.69 2 2.50 -0.50 0.25 0.10 11 8.50 2.50 6.25 0.74 8 4.00 4.00 16.00 4.00 0 3.75 -3.75 14.06 3.75 6 6.25 -0.25 0.06 0.01 0 2.50 -2.50 6.25 2.50 4 5.78 -1.78 3.11 0.55 1 2.72 -1.72 2.9 1.09 0 2.55 -2.55 6.50 2.55 4 4.25 -0.25 0.0 0.01 8 1.70 6.30 39.69 23.35 0 0.00 0.00 0.00 0.00 0 0.00 0.00 0.00 0.00 0 0.00 0.00 0.00 0.00 0 0.00 0.00 0.00 0.00 0 0.00 0.00 0.00 0.00 TOTAL 54.04 40
  • 41. STEP 4: LEVEL OF SIGNIFICANCE Level of significance α = 0.05 Degrees of freedom = (R-1) (C-1) = (4-1) (5-1) =12 Tabulated value at 5% level of significance and degree of freedom 12 is 21.026 STEP 5 : COMPARING WITH TABLE VALUE The calculated value is greater than the tabulated value: 54.04 > 26.296 FINDING Therefore, reject the Null Hypothesis Ho and accept the Alternate Hypothesis H1. INFERENCE There is significant relationship between the changes taken for performance appraisal and improvement of performance appraisal. TABLE 5.21.2 CROSS TABULATION BETWEEN THE PROPER EXECUTION OF PERFORMANCE APPRAISAL AND RATING EMPLOYEE PERFORMANCE. Proper execution YES NO TOTAL Rating Performance Based on abilities and skills 8 2 10 Based on management reference 19 6 25 Based on superiority 21 4 25 Based on contribution 30 10 40 TOTAL 78 22 100 41
  • 42. STEP 1: SETTING AN HYPOTHESIS H0: There is no significant relationship between the changes taken for performance appraisal and improvement of performance appraisal. H1: There is significant relationship between the changes taken for performance appraisal and improvement of performance appraisal. STEP 2: TO FIND THE EXPECTED FREQUENCY Expected frequency = Corresponding row total * Corresponding column total Total number of samples STEP 3: CALCULATION OF CHI-SQUARE VALUE Formula: =∑ (O-E) 2 E Where = Chi-Square Oi = Observed Frequency Ei = Expected Frequency TABLE 5.21.2.1 COMPUTATION TABLE FOR O E (O-E) (O-E)2 (O-E)2/E 8 7.80 0.20 0.04 0.01 2 2.20 -0.20 0.04 0.02 19 19.50 -0.50 0.25 0.01 6 5.50 0.50 0.25 0.05 21 19.50 1.50 2.25 0.12 4 5.50 -1.50 2.25 0.41 30 31.20 -1.20 1.44 0.05 10 8.80 1.20 1.44 0.16 TOTAL 0.82 42
  • 43. STEP 4: LEVEL OF SIGNIFICANCE Level of significance α = 0.05 Degrees of freedom = (R-1) (C-1) = (4-1) (2-1) = 3 Tabulated value at 5% level of significance and degree of freedom 3 is 7.28 STEP 5 : COMPARING WITH TABLE VALUE The calculated value is greater than the tabulated value: 0.82<7.82 FINDING Therefore, accept the Null Hypothesis H0 and reject the Alternate Hypothesis H1. INFERENCE There is no significant relationship between the changes taken for performance appraisal and improvement of performance appraisal. 43
  • 44. 6. SUMMARY AND CONCLUSION 6.1 FINDINGS 1. Majority (89%) of respondents are male. 2. Most of the respondents (33%) belong to the age group of 30 to 35. 3. 54% of the respondents have above 5 to10years of work experience. 4. Majority (49%) of the respondents are under graduates. 5. All of the respondents have under gone performance appraisal program once in a year. 6. 100% of the employees interpret the reason for conducting performance appraisal includes all the factors such as to identify motivating methods, to decide monetary benefits and identify barriers for performance. 7. For 87% of the respondents performance appraisal was conducted during working hours. 8. For 100% of the respondents the performance appraisal is conducted by outsider. 9. Most (77%) of the respondents feel that the reason for performance appraisal is discussed sometimes. 10. Once in a year the meeting IS scheduled for all employees to discuss their performance. 44
  • 45. 11. 69% of the respondents feel that performance appraisal is related to organizational goals to some extent. 12. All of the respondents infer that they are never involved in designing the performance appraisal system. 13. 87% of the respondents feel that the performance appraisal system is developed highly relevant to the employee’s job. 14. All respondents mostly share their opinion and suggestions freely during the performance appraisal. 15. All respondents have got the training to fill up the performance appraisal forms. 16. All of the respondents feel that the appraiser is not aware of the jobs and duties of the each and every employee. 17. 89% respondents feel the superior will provide informal feedbacks for performance improvement occasionally. 18. Most (44%) of the respondents feel that the raters are less involved while appraising employees. 19. Most (78%) of the respondents says the Performance Appraisal is properly executed in the organization. 20. Majority (54%) of the respondents feel that performance appraisal system is reviewed and updated occasionally. 45
  • 46. 6.2 SUGGESTIONS 1. Performance appraisal could be conducted by a person inside the organization and one who is familiar with the employees. 2. Objective of conducting the performance appraisal could be discussed and doubts can be clarified. 3. Performance appraisal could be updated regularly to match individual and organizational goals. 4. Suggestion could be obtained from employees regarding framing the performance appraisal system. 5. Since the performance appraisal is conducted by the outsider, employees' suggestion during performance appraisal may not reach the top managers. For such situations suggestion box can be implemented and frequently reviewed. 6. The appraiser must be familiarized with the employee's job responsibilities and duties before conducting performance appraisal. 7. Feedback on performance could be discussed through formal or informal meetings. 8. This may enhance the involvement and performance of employees. 9. Appropriate and experienced appraiser can be appointed for effective performance appraisal results. 10. Performance appraisal can developed in such away to identify the hidden talent and skills of employees. 11. Employees having low performance could be called individually, encouraged and monitored closely to make improvements. 12. Appraisal feedback is very important in any performance appraisal program. Could be carefully communicated by making high performers increase their target and low performers to build up their confidence. 46
  • 47. 6.3 CONCLUSION Performance appraisal may be understood as the assessment of an individual's performance in a systematic way. The performance being measured against such factors as job knowledge, quality and quantity of output, initiative, leadership abilities, supervision, dependability, co-operation, judgment, versatility, health and the like. It also helps in developing strength and rectifies weakness of the employees. BMW Group have been conducting performance appraisal for the past four years. From the study it has been identified that the performance appraisal is able to identify employees' potential and find the motivating factors of employees. The major drawback is in terms of the appraiser and his knowledge regarding employee’s job responsibilities and duties. BMW Group has been running successfully for past 5years and has created a good name among its customers and society. People having poor background are given training and provided with jobs. Performance appraisal can be conducted more effectively by using the right tools and properly reviewing and updating the performance appraisal program. Suggestion form employees and experienced personnel can further enhance and make the performance appraisal an ideal evaluation system. 47
  • 48. BIBLOGRAPHY BOOKS Human Resource Management. By S. Seetharaman & B.Venkateswara Prasad, Scitech Publication, 2007. Kothari, C.R., Research Methodology- Methods & Techniques, New Delhi, New Age international(P)Ltd.,Publishers,SecondEdition,2004. Performance Management, Concepts, Practices and Strategies for Organisation success by S.K.Bhatia, Deep & Deep Publications Pvt. Ltd, 2008. Statistical Methods for Management, By P.N.Arora & S.Arora New Delhi, Sultan Chand & Sons Publishers, 2005. WEBSITE www.BMWGroup.com www.citehr.com www.performanceappraisal.com 48
  • 49. APPENDIX Name : Gender : () Male Female () Age group : () 20-30 () 31-40 () 41-50 () 51-60 Experience : () Less than 3years () 4-8Years () 9-15Years () More than15Years Qualification : 1. How many times performance appraisal is conducted in your organization? a) Once a year b) Twice a year c) No specific time 2. What is the reason for conducting performance appraisal in your organization? a) To identify motivating methods b) To decide monetary benefits c) Identifying barriers of performance d) All of the above 3. When is the performance appraisal conducted? a) During working hours b) during non-working hours 4. Who conducts performance appraisal? a) Superior b) Peers c) Everyone d) Outsider 49
  • 50. 5. Are you informed the reason for conducting performance appraisal programs? a) Always b) Sometimes c) Never 6. How many meetings are scheduled in a year to discuss employee performance? a) Nil b) Once c) Twice d) Thrice 7. Does the performance appraisal programs relate to organizational goals? a) To a high extent b) To some extent c) To a low extent 8. Are you involved along with the manager in designing the appraisal system at the organization? a) Always b) Sometimes c) Never 9. Is the performance appraisal developed in relevance to employee job? a) Highly relevant b) relevant c) no idea d) Irrelevant e) highly irrelevant 10. Do you share your opinion and suggestions freely to the managers during the appraisal program? a) Mostly b) rarely c) never 11. Are you given training to fill up performance appraisal forms? a) Yes b) No 12. Is the appraiser aware of your job responsibilities and duties? a) Completely aware b) Aware to an extent c) Not aware 13.0ther than performance appraisal does your superior provide you within formal feedbacks for performance improvement? a) Frequently b) Occasionally c) never 50
  • 51. 14. Are the raters involved while appraising employees? a) Highly involved b) Less involved c) not involved 15. Do you feel that performance appraisal is important in an organization? a) Highly important b) less important c) not important d) No idea 16. Is performance appraisal properly executed in your organization? a) Yes b) No 17. Does top management support and encourage performance appraisal? a) Highly supportive b) Less supportive c) Not supportive 18. Is the performance appraisal reviewed and updated now and then? a) Frequently b) Occasionally c) Never 19. Does performance appraisal identify employee potential for advancement? a) Highly effectively b) Effectively c) Neutral d) Ineffectively e) Highly ineffectively 20. State your satisfaction through the performance appraisal program at the organization? a) Unsatisfactory b) Needs Improvement c) Meets Expectation d) Outstanding 21. Do you feel that performance appraisal encourages you to put in more effort in reaching your goals? a) Strongly agree b) Agree c) Neutral d) Disagree e) Strongly disagree 22. Do you obtain appraisal feedback? a) Frequently b) Occasionally c) Rarely d) Never 51
  • 52. 23. Are both five & negative points discussed to the employees? a) Yes b) No 24. How do you feel when negative points are discussed? a) Discouraged b) Determined to perform better c) ready to learn d) Do not want to contribute 25. Rate your appraisal program a) Reliable b) Effective c) Accurate d) Motivating e) Unbiased 26. Do you feel comfortable in discussing your problems with your superior? a) Highly Comfortable b) Comfortable c)Neutral d) Uncomfortable e) Highly uncomfortable 27. On what criteria is employee performance rated? a) Based on abilities and skills b) Based on management reference c) Based on superiority d) Based on contribution 28. What changes have been taken in the organization as a result of performance appraisal? a) Change in motivating strategy b) Re-structuring of organization or individual objectives c) Improvement in management-employee relationship d) Making changes in dissatisfied areas e) No decision taken 29. In general, how effective has your organization performance appraisal system in improving overall performance a) Highly ineffective b) Ineffective c) Moderate d) Effective e) Highly effective 52