MAHARAJA RANJIT SINGH COLLEGE

OF PROFESSIONAL SCIENCES.

(Approved by Govt. of M.P. & AICTE Delhi & Affiliated to DAVV, Indore & RGPV, Bhopal)

Major Research Project

On
"Impact of Performance & Motivation on
Employee Satisfaction: A study of Selected
Companies
Submitted to
DEVI AHILYA VISHWAVIDHYALAY, INDORE,
For the fulfillment of degree of
M.B.A. {SESSION 2016-18}

Supervision & Guided by Submitted By:-

Dr. Ira Bapna Ashish Pathrod
Director M.B.A.IV SEM
{H.R. +Marketing}

1
 Declaration
I Ashish Pathrod student of Maharaja Ranjit Singh College of
Professional Sciences, Indore hereby declare that the work done by me to
do the Major Research Project titled “IMPACT OF PERFORMANCE
AND MOTIVATION ON EMPLOYEE SATISFACTION” is
authenticate as per my knowledge and work outcome of my own research.
This report in any form has not been submitted to any other institute or
university for any degree or similar award.

Date:
Place: Ashish Pathrod
M.B.A.-IV SEM
{H.R. +Marketing}

2
 Acknowledgement
I sincerely & religiously devote this folio to all the gem of persons who
have openly or silently left an ineradicable mark on this research so that
they may be brought into consideration and given their share of credit,
which they genuinely & outstandingly deserve.
I express my thanks to Director Dr.Ira Bapna, Coordinators & faculty
members for their considerate support whenever and wherever needed. I
express my indebtedness to the management of Maharaja Ranjit Singh
College of Professional Sciences for inspiring me to grab & utilize this
opportunity.
With profound sense of gratitude, I would like to truthfully thank a
recognizable number of individuals who have not mentioned here, but
who have visibly or invisibly facilitated in transforming this research into
a success saga.
Above all, I would like to conscientiously thank the omnipotent,
omnipresent & omniscient god for his priceless blessings!

Date:
Place: Ashish Pathrod
M.B.A.IV SEM

3
 Certificate from Director

This is to certify that Ashish Pathrod student of MBA [Full Time] IV

Semester in Maharaja Ranjit Singh College of Professional Sciences,
Indore {M.P.} has carried out a Major Research Project titled “Impact of
Performance and motivation on Employee Satisfaction”. The work
done by him is genuine and authentic.

The work carried out by the student was found satisfactory. We wish his
all the success in career.

Director
Dr.Ira Bapna
MRSCPS, INDORE.

4
 Preface

Motivation is an effective and dynamic instrument in the hands of a manager for

inspiring the workforce and creating the confidence in them. Through the motivation
of the workforce, management creates “will to work” which is necessary for the
achievements of organizational goals and objectives. Motivation is the process of
getting the members or the group to pull weight effectively, to give their loyalty to
the group and to carry out properly the purpose of the organization.

This Project report mainly deals in knowing the levels of the motivation & personal
effectiveness &also the impact of motivation on personal effectiveness of employees
of Force motors limited. Force Motors is a fully, vertically integrated automobile
company, with expertise in design, development and manufacture of the full
spectrum of automotive components, aggregates and vehicles. As, Force Motors
limited believes that an organization gets its strength from its employees and the
company cultivated a corporate culture that truly reflects the qualities of ‘Continuous
Improvement &Respect for People ‘in all activities, collective and individual. The
Force Motors not only encourages employees to give their suggestions on improving
our products, practices &work environment, but also reward them for their valuable
inputs. Hence the present study is to investigate levels of motivation & personal
effectiveness & also to find the impact of motivation levels on the personal
effectiveness of the employees of Force Motors Limited.

The research is divided into major seven chapters i.e. introduction, literature review,
objective of study, research methodology, analysis and interpretation, suggestions
and conclusions of the study. For data analysis Percentage analysis & regression
analysis is used.This study is very significant as it shows impact of motivation &

5
performance on employee satisfaction which is good for better performance, creates
creativity in work place, congenial work climate, sense of responsibility, trust &
dominance among workers which leads to job satisfaction & developing healthy
work culture in the organization.

6
 Table of Contents

 Cover Page…………………………………………………………………..1
 Declaration…………………………………………………………………..2
 Acknowledgement…………………………………………………………...3
 Certificate from Director & Faculty Guide…………………………...........4
 PREFACE…………………………………………………………………...5
 Introduction……………………………………………………..…………..7
 Literature review………………………………………………….………..36
 Rationale of study…………………………………………………….........45
 Objective of study……………..…………………………………………...47
 Research methodology.…………………………………….......................49
 Data analysis and interpretation……………………………………………52
 Conclusion………………………………………………………………….58
 Suggestion………………………………………………………………….60
 References…………………………………………………….……………62
 Questionnaire………………………………………………………………65

7
INTRODUCTION

8
Introduction

HUMAN RESOURCE MANAGEMENT

Human resource management (HRM or simply HR) is the management of human resources. It
is a function in organizations designed to maximize employee performance in service of an
employer's strategic objectives. HR is primarily concerned with the management of people within
organizations, focusing on policies and on systems. HR departments and units in organizations
typically undertake a number of activities, including employee benefits design
employee recruitment, "development”, performance, and rewarding (e.g., managing pay and
benefit systems). HR also concerns itself with organizational change and industrial relations, that
is, the balancing of organizational practices with requirements arising from collective bargaining
and from governmental laws. According to R. Buettner, HRM covers the following core areas:

 job design and analysis,

 workforce planning,
 recruitment and selection,
 training and development,
 performance management,
 compensation (remuneration), and
 Legal issues.

HR is a product of the human relations movement of the early 20th century, when researchers
began documenting ways of creating business value through the strategic management of the
workforce. The function was initially dominated by transactional work, such
as payroll and benefits administration, but due to globalization, company consolidation,
technological advances, and further research, HR as of 2015 focuses on strategic initiatives
like mergers and acquisitions, talent management, succession planning, industrial and labor
relations, and diversity and inclusion.

Human Resources are a business field focused on maximizing employee productivity. Human
Resources professionals manage the human capital of an organization and focus on implementing
policies and processes. They can be specialists focusing in on recruiting, training, employee

9
relations or benefits. Recruiting specialists are in charge of finding and hiring top talent. Training
and development professionals ensure that employees are trained and have continuous
development. This is done through training programs, performance evaluations and reward
programs. Employee relations deal with concerns of employees when policies are broken, such as
harassment or discrimination. Someone in benefits develops compensation structures, family leave
programs, discounts and other benefits that employees can get. On the other side of the field are
Human Resources Generalists or Business Partners. These human resources professionals could
work in all areas or be labor relations representatives working with unionized employees.

In startup companies, trained professionals may perform HR duties. In larger companies, an entire
functional group is typically dedicated to the discipline, with staff specializing in various HR tasks
and functional leadership engaging in strategic decision-making across the business. To train
practitioners for the profession, institutions of higher education, professional associations, and
companies themselves have established programs of study dedicated explicitly to the duties of the
function. Academic and practitioner organizations likewise seek to engage and further the field of
HR, as evidenced by several field-specific publications. HR is also a field of research study that is
popular within the fields of management and industrial/organizational psychology, with research
articles appearing in a number of academic journals, including those mentioned later in this article.

Businesses are moving globally and forming more diverse teams. It is the role of human resources
to make sure that these teams can function and people are able to communicate cross culturally
and across borders. Due to changes in business, current topics in human resources are diversity
and inclusion as well as using technology to advance employee engagement. In the current global
work environment, most companies focus on lowering employee turnover and on retaining the
talent and knowledge held by their workforce. New hiring not only entails a high cost but also
increases the risk of a newcomer not being able to replace the person who worked in a position
before. HR departments strive to offer benefits that will appeal to workers, thus reducing the risk
of losing corporate knowledge.

Definition and Concept

10
We often hear the term Human Resource Management, Employee and Personnel
Management used in the popular press as well as by Industry experts. Whenever we hear these
terms, we conjure images of efficient managers busily going about their work in glitzy offices.

In this article, we look at the question “what is HRM?” by giving a broad overview of the topic
and introducing the readers to the practice of HRM in contemporary organizations. Though as with
all popular perceptions, the above imagery has some validity, the fact remains that there is much
more to the field of HRM and despite popular depictions of the same, the “art and science” of
HRM is indeed complex. We have chosen the term “art and science” as HRM is both the art of
managing people by recourse to creative and innovative approaches; it is a science as well because
of the precision and rigorous application of theory that is required.

As outlined above, the process of defining HRM leads us to two different definitions. The first
definition of HRM is that it is the process of managing people in organizations in a structured
and thorough manner. This covers the fields of staffing (hiring people), retention of people, pay
and perks setting and management, performance management, change management and taking
care of exits from the company to round off the activities. This is the traditional definition of HRM
which leads some experts to define it as a modern version of the Personnel Management function
that was used earlier.

The second definition of HRM encompasses the management of people in organizations from
a macro perspective i.e. managing people in the form of a collective relationship between
management and employees. This approach focuses on the objectives and outcomes of the HRM
function. What this means is that the HR function in contemporary organizations is concerned with
the notions of people enabling, people development and a focus on making the “employment
relationship” fulfilling for both the management and employees.

These definitions emphasize the difference between Personnel Management as defined in the
second paragraph and human resource management as described in the third paragraph. To put it
in one sentence, personnel management is essentially “workforce” centered whereas human
resource management is “resource” centered. The key difference is HRM in recent times is

11
about fulfilling management objectives of providing and deploying people and a greater emphasis
on planning, monitoring and control.

Following are the important concepts of Human Resource Management:

 Importance of HRM
 Scope of HRM
 Various Processes in HRM
 What is Human Resource Planning?
 The HRM Function
 Functions of a Human Resource Manager
 Staffing Role of the HR Manager
 Role of HRM in Leadership Development
 Role of HR in People Empowerment
 Talent Management and HRM
 Performance Management as a HR Management Concept
 Hiring Strategies
 Retention Strategies.

Functions of Human resource Management:-

Human Resource Management functions can be classified in following two categories.

 Managerial Functions, and
 Operative Functions.
The Managerial Functions of Human Resource Management are as follows:
1. Human Resource Planning - In this function of HRM, the number and type of employees
needed to accomplish organizational goals is determined. Research is an important part of this
function, information is collected and analysed to identify current and future human resource needs
and to forecast changing values, attitude, and behaviour of employees and their impact on
organisation.
2. Organizing - In an organisation tasks are allocated among its members, relationships are
identified, and activities are integrated towards a common objective. Relationships are established

12
among the employees so that they can collectively contribute to the attainment of organisation
goal.
3. Directing - Activating employees at different level and making them contribute maximum to
the organisation is possible through proper direction and motivation. Taping the maximum
potentialities of the employees is possible through motivation and command.
4. Controlling - After planning, organizing, and directing, the actual performance of employees
is checked, verified, and compared with the plans. If the actual performance is found deviated from
the plan, control measures are required to be taken.

The Operative Functions of Human Resource Management are as follows:

1. Recruitment and Selection - Recruitment of candidates is the function preceding the selection,
which brings the pool of prospective candidates for the organisation so that the management can
select the right candidate from this pool.
2. Job Analysis and Design - Job analysis is the process of describing the nature of a job and
specifying the human requirements like qualification, skills, and work experience to perform that
job. Job design aims at outlining and organizing tasks, duties, and responsibilities into a single unit
of work for the achievement of certain objectives.
3. Performance Appraisal - Human resource professionals are required to perform this function
to ensure that the performance of employee is at acceptable level.
4. Training and Development - This function of human resource management helps the
employees to acquire skills and knowledge to perform their jobs effectively. Training an
development programs are organized for both new and existing employees. Employees are
prepared for higher level responsibilities through training and development.
5. Wage and Salary Administration - Human resource management determines what is to be
paid for different type of jobs. Human resource management decides employees compensation
which includes - wage administration, salary administration, incentives, bonuses, fringe benefits,
and etc,.
6. Employee Welfare - This function refers to various services, benefits, and facilities that are
provided to employees for their well being.

13
7. Maintenance - Human resource is considered as asset for the organisation. Employee turnover
is not considered good for the organisation. Human resource management always tries to keep
their best performing employees with the organisation.
8. Labour Relations - This function refers to the interaction of human resource management with
employees who are represented by a trade union. Employees comes together and forms an union
to obtain more voice in decisions affecting wage, benefits, working condition, etc,.
9. Personnel Research - Personnel researches are done by human resource management to gather
employees' opinions on wages and salaries, promotions, working conditions, welfare activities,
leadership, etc,. Such researches helps in understanding employees satisfaction, employees
turnover, employee termination, etc,.
10. Personnel Record - This function involves recording, maintaining, and retrieving employee
related information like - application forms, employment history, working hours, earnings,
employee absents and presents, employee turnover and other data related to employees.

14
Motivation
Motivation is a theoretical construct used to explain behavior. It represents the reasons for
people's actions, desires, and needs. Motivation can also be defined as one's direction to behavior
or what causes a person to want to repeat a behavior and vice versa. A motive is what prompts the
person to act in a certain way, or at least develop an inclination for specific behavior. According
to Maher and Meyer, "Motivation is a word that is part of the popular culture as few other
psychological concepts are."

15
The term motivation is derived from the word ‘motive”. The word ‘motive’ as a noun means an
objective, as a verb this word means moving into action. Therefore, motives are forces which
induce people to act in a way, so as to ensure the fulfillment of a particular human need at a time.
Behind every human action there is a motive. Therefore, management must provide motives to
people to make them work for the organization.

Following are the outstanding Features of the concept of motivation:

1. Motivation is a personal and internal feeling:

Motivation is a psychological phenomenon which generates within an individual.

2. Motivation is need based:

If there are no needs of an individual, the process of motivation fails. It is a behavioral concept
that directs human behaviour towards certain goals.

3. Motivation is a continuous process:

Because human wants are unlimited, therefore motivation is an ongoing process.

4. Motivation may be positive or negative:

A positive motivation promotes incentives to people while a negative motivation threatens the
enforcement of disincentives.

5. Motivation is a planned process:

People differ in their approach, to respond to the process of motivation; as no two individuals could
be motivated in an exactly similar manner. Accordingly, motivation is a psychological concept
and a complex process.

6. Motivation is different from job satisfaction:

The process of motivation is illustrated in the figure given below:
Figure 15.1 shows an employee has a need or urge for promotion to a higher position. If this need
is strong, the employee will fix his goal and find alternatives to reach the goal. The might have
two alternatives, namely, (i) hard work and (ii) enhancement of qualification (e.g., getting MBA)
and hard work.

16
He might choose the second alternative and succeed in getting promotion (goal achievement) thus,
his need for promotion would be satisfied and he would start again for the satisfaction of a new
need.

Significance/Importance of Motivation:
Motivation is an integral part of the process of direction.

While directing his subordinate, a manager must create and sustain in them the desire to
work for the specified objectives:
1. High Efficiency:
A good motivational system releases the immense untapped reservoirs of physical and mental
capabilities. A number of studies have shown that motivation plays a crucial role in determining
the level of performance. “Poorly motivated people can nullify the soundest organisation.” said
Allen.

By satisfying human needs motivation helps in increasing productivity. Better utilization of

resources lowers cost of operations. Motivation is always goal directed. Therefore, higher the level
of motivation, greater is the degree of goal accomplishment.

2. Better Image:
A firm that provides opportunities for financial and personal advancement has a better image in
the employment market. People prefer to work for an enterprise because of opportunity for
development, and sympathetic outlook. This helps in attracting qualified personnel and simplifies
the staffing function.

17
3. Facilitates Change:
Effective motivation helps to overcome resistance to change and negative attitude on the part of
employees like restriction of output. Satisfied workers take interest in new organizational goals
and are more receptive to changes that management wants to introduce in order to improve
efficiency of operations.

4. Human Relations:
Effective motivation creates job satisfaction which results in cordial relations between employer
and employees. Industrial disputes, labour absenteeism and turnover are reduced with consequent
benefits. Motivation helps to solve the central problem of management, i.e., effective use of human
resources. Without motivation the workers may not put their best efforts and may seek satisfaction
of their needs outside the organisation.

The success of any organisation depends upon the optimum utilization of resources. The utilization
of physical resources depends upon the ability to work and the willingness to work of the
employees. In practice, ability is not the problem but necessary will to work is lacking. Motivation
is the main tool for building such a will. It is for this reason that Rensis Likert said, “Motivation is
the core of management.” It is the key to management in action.

Definition
“A motivation is an inner state that energies, activates , or moves and that directs behavior towards
goals.”
“A motive is restlessness, a lack , a yen, a force. One in the grip of a motive, the organism does
something to reduce the restlessness, to remedy the lack , to alleviate the yen , to mitigate the
force.”
“ Motivation is the complex forces starting and keeping a person at work in an organization.
Motivation is something that moves the person to action and continues him in the course of
action already initiated.”
“ Motivation refers to the way in which urges, drivers, desires, aspiration, striving or needs
direct, control or explain the behavior of human beings .”

18
Koontz and O’ Donnell

“Motivation is a general term applying to the entire class of drives, needs, wishes and similar
forces.”
Mr. Brech

“Motivation is a general inspiration process which gets the members of the team to pull their
weight effectively, to give their loyalty to the group, to carry out properly the tasks they have
accepted and generally to play an effective part in the job that the group has undertaken,”

“Motivation is a general term applying to the entire class of drives, desires, needs, wishes and
similar forces. To say that managers motivate their subordinates is to say that they do those things
which they hope will satisfy these drives and desires and induce the subordinates to act in a desired
manner.”

“Motivation is getting somebody to do something because he want to do it. It was once assumed
that motivation had to be injected from outside, but it is now understood that everyone is motivated
by several differing forces.”

“ Motivation is a general term applied to the entire class of drives, desires, needs, wishes and
similar forces. Nearly all conscious behavior of human being is motivated. The internal needs and
drives result into actions for instance, the need for food result in hunger and hence a person is
motivated to eat.”

“ Motivation is the result of processes internal or external to the individual, that arouse enthusiasm
and persistence to pursue a certain course of action.”

Stanley Vance defines motivation as, “any emotion or desire which so conditions one’s will that
the individual is propelled into action.”

19
Robert Dubin defines motivation , “ as the complex of forces standing and keeping a person at
work in an organization.”

Beach defines, “ Motivation as a willingness to expand energy to achieve a goal or a reword.”

Shartle defines, “Motivation as a reported urge or tension to move in a given direction or to

achieve a certain goal.”

Owen defines, “ Motivation as an ordered way of explaining way a person elects to channel his
energies in one direction rather than in another.”

Eduir B. Flippo, “ Motivation is the process of attempting to influence others to do yours will
through the possibility of gain reward.”

The Encyclopedia of management has defined motivation as,

“ Motivation refers to the degree of readiness of an organism to pursue some destinated goal and
implies the determination of the nature and locus of the forces inducing the degree of readiness.”

Delton E. MC Farland,

“ The concept of motivation is mainly psychological. It relates to those forces operating within the
individual employee or subordinate which impel him to act or not to act in certain ways.”

Michael J . Jucious,

“ Motivation is the act of stimulating someone or oneself to get a desired course of action, to push
the right button to get the desired action.”

20
J.E.Rosenz Weig and E.K.Kast ,

“Motivation is an inspiration process which impels the members of the team to accomplish the
desired goals.”

S.Zedeck and K Blood, “ Motivation is a pre-disposition to act in a specified goal directed way.”

Features of Motivation

1.) Motivation can be positive or negative :-

-> There can be positive motivation and negative motivation.

-> Positive motivation can be simulative, such as higher pay, power position etc.
-> Negative motivation implies the use of penalties, punishments etc.

2. Motivation is goal oriented :-

-> Motivation is a behavioral concept. It directs human behavior towards the accomplishment
of goals.
-> If properly motivated, employees put in their best possible efforts in orders to achieve the
desired goals.

3. Motivation is complex in nature :-

-> Different individuals behave differently to a given set of incentives.

-> Some employees may be highly motivated when they are given monetary incentives, whereas
others may be more motivated with the use of non-monetary incentives.

4. Motivation is system oriented :-

-> Motivation is a combined effect of these groups of factors.

-> Forces operating within individual, i.e. his nature, needs, values etc.
5. Motivation is different from job satisfaction:-

21
 -> Motivation is the act to satisfy needs and desires. Job satisfaction results only when such
needs and desires are fulfilled. Job satisfaction is the outcome of motivation.

6. Motivation is a continuous process:-

-> Motivation is not a one time process.

-> This is because, human needs and desires are never ending. When one needs is satisfied,
another needs emerges that is to be satisfied. Therefore managers have to identify the emerging
needs of their subordinates and strive to satisfy such needs at regular intervals.

Importance of Motivation

Maximum utilization of factors of production :

workers perform the work sincerely through the inspiration of motivation.

Willingness to work:

Motivation influences the willingness of people to work. A man is technically, mentally and
physically fit to perform the work but they may not be willing to work.
Reduced absenteeism:

Financial incentive schemes coerce the workers to work more. This reduces absenteeism.

Reduced labour turnover:

Motivation has both financial and non-financial incentive schemes. This helps to retain the
existing labourers.

Availability of right personnel:

Financial and non- financial incentives not only retain the existing employees but also attract
the employees from outside the enterprise.

22
Building of good labour relations :
Motivation helps to solve the labour problems of absenteeism, labour turnover, indiscipline and
grievance.
Increase in the efficiency and output:
Both workers and management have got benefits from motivational plans.

Sense of belonging:
A proper motivation scheme promotes closer rapport between enterprise and workers.

Basis of co-operation :
Efficiency and output are increased through co-operation. The co-operation could not be obtained
without motivation, so motivation is a basis of co-operation.

Helps in realizing organizational goals :

Organizational goals are achieved quickly through motivation. Motivated employees have a
feeling of total involvement in the performance of organization task.

Theories of Motivation

Overview

At a simple level, it seems obvious that people do things, such as go to work, in order to get stuff
they want and to avoid stuff they don't want.

Why exactly they want what they do and don't want what they don't is still something a mystery.
It's a black box and it hasn't been fully penetrated.

Overall, the basic perspective on motivation looks something like this:

23
In other words, you have certain needs or wants (these terms will be used interchangeably), and
this causes you to do certain things (behavior), which satisfy those needs (satisfaction), and this
can then change which needs/wants are primary (either intensifying certain ones, or allowing you
to move on to other ones).

A variation on this model, particularly appropriate from an experimenter's or manager's point of

view, would be to add a box labeled "reward" between "behavior" and "satisfaction". So that
subjects (or employees), who have certain needs do certain things (behavior), which then get
them rewards set up by the experimenter or manager (such as raises or bonuses), which satisfy
the needs, and so on.

Classifying Needs

People seem to have different wants. This is fortunate, because in markets this creates the very
desirable situation where, because you value stuff that I have but you don't, and I value stuff that
you have that I don't, we can trade in such a way that we are both happier as a result.

But it also means we need to try to get a handle on the whole variety of needs and who has them
in order to begin to understand how to design organizations that maximize productivity.

Part of what a theory of motivation tries to do is explain and predict who has which wants. This
turns out to be exceedingly difficult.

Many theories posit a hierarchy of needs, in which the needs at the bottom are the most urgent
and need to be satisfied before attention can be paid to the others.

Maslow

Maslow's hierarchy of need categories is the most famous example:

self-actualization

Esteem

Belongingness

24
Safety

Physiological

Specific examples of these types are given below, in both the work and home context. (Some of
the instances, like "education" are actually satisfiers of the need.)

Need Home Job

self- education, religion, hobbies,

training, advancement, growth, creativity
actualization personal growth

approval of family, friends,

Esteem recognition, high status, responsibilities
community

teams, depts, coworkers, clients,

Belongingness family, friends, clubs
supervisors, subordinates

freedom from war, poison, work safety, job security, health

Safety
violence insurance

Physiological food water sex Heat, air, base salary

According to Maslow, lower needs take priority. They must be fulfilled before the others are
activated. There is some basic common sense here -- it's pointless to worry about whether a
given color looks good on you when you are dying of starvation, or being threatened with your
life. There are some basic things that take precedence over all else.

Or at least logically should, if people were rational. But is that a safe assumption? According to
the theory, if you are hungry and have inadequate shelter, you won't go to church. Can't do the
higher things until you have the lower things. But the poor tend to be more religious than the
rich. Both within a given culture, and across nations. So the theory makes the wrong prediction
here.

Or take education: how often do you hear "I can't go to class today, I haven't had sex in three
days!"? Do all physiological needs including sex have to be satisfied before "higher"
needs? (Besides, wouldn't the authors of the Kama Sutra argue that sex was a kind of self-
expression more like art than a physiological need? that would put it in the self-actualization
box). Again, the theory doesn't seem to predict correctly.

25
Cultural critique: Does Maslow's classification really reflect the order in which needs are
satisfied, or is it more about classifying needs from a kind of "tastefulness" perspective, with
lofty goals like personal growth and creativity at the top, and "base" instincts like sex and hunger
at the bottom? And is self-actualization actually a fundamental need? Or just something that can
be done if you have the leisure time?

Alderfer's ERG theory

Alderfer classifies needs into three categories, also ordered hierarchically:

 growth needs (development of competence and realization of potential)

 relatedness needs (satisfactory relations with others)
 existence needs (physical well-being)

This is very similar to Maslow -- can be seen as just collapsing into three tiers. But maybe a bit
more rational. For example, in Alderfer's model, sex does not need to be in the bottom category
as it is in Maslow's model, since it is not crucial to (the individual's) existence. (Remember, this
about individual motivation, not species' survival.) So by moving sex, this theory does not
predict that people have to have sex before they can think about going to school, like Maslow's
theory does.

Alderfer believed that as you start satisfying higher needs, they become more intense (e.g., the
power you get the more you want power), like an addiction.

Do any of these theories have anything useful to say for managing businesses? Well, if true, they
suggest that

 Not everyone is motivated by the same things. It depends where you are in the hierarchy
(think of it as a kind of personal development scale)
 The needs hierarchy probably mirrors the organizational hierarchy to a certain extent: top
managers are more likely to motivated by self-actualization/growth needs than existence
needs. (but try telling Bill Clinton that top executives are not motivated by sex and
cheeseburgers...)

Acquired Needs Theory (mcclellan)

Some needs are acquired as a result of life experiences

 need for achievement, accomplish something difficult. as kids encouraged to do things

for themselves.
 need for affiliation, form close personal relationships. as kids rewarded for making
friends.
 need for power, control others. as kids, able to get what they want through controlling
others.

26
Again similar to Maslow and alderfer.

These needs can be measured using the TAT (Thematic Apperception Test), which is a
projection-style test based on interpreting stories that people tell about a set of pictures.

Cognitive Evaluation Theory

This theory suggests that there are actually two motivation systems: intrinsic and extrinsic that
corresponds to two kinds of motivators:

 Intrinsic motivators: Achievement, responsibility and competence. motivators that come

from the actual performance of the task or job -- the intrinsic interest of the work.
 Extrinsic: pay, promotion, feedback, working conditions -- things that come from a
person's environment, controlled by others.

One or the other of these may be a more powerful motivator for a given individual.

Intrinsically motivated individuals perform for their own achievement and satisfaction. If they
come to believe that they are doing some job because of the pay or the working conditions or
some other extrinsic reason, they begin to lose motivation.

The belief is that the presence of powerful extrinsic motivators can actually reduce a person's
intrinsic motivation, particularly if the extrinsic motivators are perceived by the person to be
controlled by people. In other words, a boss who is always dangling this reward or that stick will
turn off the intrinsically motivated people.

Note that the intrinsic motivators tend to be higher on the Maslow hierarchy.

Two Factor theory (Herzberg)

According to Herzberg, two kinds of factors affect motivation, and they do it in different ways:

 Hygiene factors. These are factors whose absence motivates, but whose presence has no
perceived effect. They are things that when you take them away, people become
dissatisfied and act to get them back. A very good example is heroin to a heroin addict.
Long term addicts do not shoot up to get high; they shoot up to stop being sick -- to get
normal. Other examples include decent working conditions, security, pay, benefits (like
health insurance), company policies, interpersonal relationships. In general, these are
extrinsic items low in the Maslow/Alderfer hierarchy.
 Motivators. These are factors whose presence motivates. Their absence does not cause
any particular dissatisfaction, it just fails to motivate. Examples are all the things at the
top of the Maslow hierarchy, and the intrinsic motivators.

So hygiene factors determine dissatisfaction, and motivators determine satisfaction. The two
scales are independent, and you can be high on both.

27
If you think back to the class discussion on power, we talked about a baseline point on the well-
being scale. Power involved a threat to reduce your well-being, causing dissatisfaction. Hence,
power basically works by threatening to withhold hygiene factors. Influence was said to
fundamentally be about promising improvements in well-being -- when you are influenced to do
something, it is because you want to, not because you were threatened. Influence basically works
by offering to provide motivators (in Herzberg's terms).

Equity Theory

Suppose employee A gets a 20% raise and employee B gets a 10% raise. Will both be motivated
as a result? Will A be twice as motivated? Will be B be negatively motivated?

Equity theory says that it is not the actual reward that motivates, but the perception, and the
perception is based not on the reward in isolation, but in comparison with the efforts that went
into getting it, and the rewards and efforts of others. If everyone got a 5% raise, B is likely to feel
quite pleased with her raise, even if she worked harder than everyone else. But if A got an even
higher raise, B perceives that she worked just as hard as A, she will be unhappy.

In other words, people's motivation results from a ratio of ratios: a person compares the ratio of
reward to effort with the comparable ratio of reward to effort that they think others are getting.

Of course, in terms of actually predicting how a person will react to a given motivator, this will
get pretty complicated:

1. People do not have complete information about how others are rewarded. So they are
going on perceptions, rumors, inferences.
2. Some people are more sensitive to equity issues than others
3. Some people are willing to ignore short-term inequities as long as they expect things to
work out in the long-term.

Reinforcement Theory

28
Operant Conditioning is the term used by B.F. Skinner to describe the effects of the
consequences of a particular behavior on the future occurrence of that behavior. There are four
types of Operant Conditioning: Positive Reinforcement, Negative
Reinforcement, Punishment, and Extinction. Both Positive and Negative Reinforcement
strengthen behavior while both Punishment and Extinction weaken behavior.

 Positive reinforcement. Strengthening a behavior. This is the process of getting goodies

as a consequence of a behavior. You make a
Apply Withhold sale, you get a commission. You do a good
job, you get a bonus & a promotion.
positive negative  Negative reinforcement. Strengthening a
behavior. This is the process of having a
reinforcement reinforcement
Reward stressor taken away as a consequence of a
(raise above (raise up to behavior. Long-term sanctions are removed
baseline) baseline) from countries when their human rights
records improve. (you see how successful that
punishment is!). Low status as geek at Salomon Brothers
extinction (stay is removed when you make first big sale.
Stressor (bring down
at baseline)  Extinction. Weakening a behavior. This is
below baseline) the process of getting no goodies when do a
behavior. So if person does extra effort, but
gets no thanks for it, they stop doing it.
 Punishment. Weakening a behavior. This is the process of getting a punishment as a
consequence of a behavior. Example: having your pay docked for lateness.

29
 Fixed Variable

give reward after give reward after

first proper a certain amt of
response time w/ the amt
Reinforcement schedules.
following a changing before
Interval specified time the next reward The traditional reinforcement schedule is called
period a continuous reinforcement schedule. Each time the
(unexpected correct behavior is performed it gets reinforced.
bonus based on
(yearly raise) merit) Then there is what we call an intermittent
reinforcement schedule. There are fixed and variable
[short term] [medium term] categories.
give reward after
The Fixed Interval Schedule is where reinforcement
a number of is only given after a certain amount of time has
punishment
responses, w/ elapsed. So, if you decided on a 5 second interval then
(subtract from
that no. changing each reinforcement would occur at the fixed time of
baseline) every 5 seconds.
before the next
Ratio
reward
(commissions or The Fixed Ratio Schedule is where the reinforcement
piecework pay) is given only after a predetermined number of
(team-based
responses. This is often seen in behavior chains where
[medium term] bonus)
a number of behaviors have to occur for reinforcement
to occur.
[long term]
The Variable Interval Schedule is where the reinforcement is given after varying amounts of
time between each reinforcement.

The Variable Ratio Schedule is where the reinforcement is given after a varying number of
correct responses.

Fluctuating combinations of primary and secondary reinforcers fall under other terms in the
variable ratio schedule; For example, Reinforcers delivered intermittently in a Randomized
Order (RIR) or Variable Ratio with Reinforcement Variety (VRRV).

Expectancy Theory (Vroom)

This theory is meant to bring together many of the elements of previous theories. It combines the
perceptual aspects of equity theory with the behavioral aspects of the other theories. Basically, it
comes down to this "equation":

30
M = E*I*V

or

Motivation = expectancy * instrumentality * valence

M (motivation) is the amount a person will be motivated by the situation they find themselves in.
It is a function of the following.

E (expectancy) = The person's perception that effort will result in performance. In other words,
the person's assessment of the degree to which effort actually correlates with performance.

I (instrumentality) = The person's perception that performance will be rewarded/punished. I.e., the
person's assessment of how well the amount of reward correlates with the quality of performance.
(Note here that the model is phrased in terms of extrinsic motivation, in that it asks 'what are the
chances I'm going to get rewarded if I do good job?'. But for intrinsic situations, we can think of
this as asking 'how good will I feel if I can pull this off?').

V(valence) = The perceived strength of the reward or punishment that will result from the
performance. If the reward is small, the motivation will be small, even if expectancy and
instrumentality are both perfect (high).

What is Employee Performance Management?

Employee Performance Management is a process for establishing a shared workforce

understanding about what is to be achieved at an organization level. It is about aligning the
organizational objectives with the employees' agreed measures, skills, competency requirements,
development plans and the delivery results. The emphasis is on improvement, learning and
development in order to achieve the overall business strategy and to create a high
performance workforce.

31
History of Performance Management

Performance Management began around 60 years ago as a source of income justification and was
used to determine an employee’s wage based on performance. Organizations used Performance
Management to drive behaviors from the employees to get specific outcomes. In practice this
worked well for certain employees who were solely driven by financial rewards. However, where
employees were driven by learning and development of their skills, it failed miserably. The gap
between justification of pay and the development of skills and knowledge became a huge problem
in the use of Performance Management. This became evident in the late 1980s; the realization
that a more comprehensive approach to manage and reward performance was needed. This
approach of managing performance was developed in the United Kingdom and the United States
much earlier than it was developed in Australia.

In recent decades, however, the process of managing people has become more formalized and
specialized. Many of the old performance appraisal methods have been absorbed into the concept
of Performance Management, which aims to be a more extensive and comprehensive process of
management. Some of the developments that have shaped Performance Management in recent
years are the differentiation of employees or talent management, management by objectives and
constant monitoring and review. Its development was accelerated by the following factors:

 The introduction of human resource management as a strategic driver and integrated approach
to the management and development of employees; and

 The understanding that the process of Performance Management is something that's

completed by line managers throughout the year - it is not a once off annual event coordinated
by the personnel department.

32
33
Company Description
Force Motors is a fully, vertically integrated automobile company, with expertise in design,
development and manufacture of the full spectrum of automotive components, aggregates and
vehicles.
Its range includes Small Commercial Vehicles, Multi-Utility Vehicles (MUV), Light
Commercial Vehicles (LCV), Sports Utility Vehicles (SUV) and Agricultural Tractors. So no
matter what the need be, Force has a solution to offer.
Force provides appropriate solutions for transport – goods as well as passenger – rugged, reliable
and efficient transport solutions for every need- Rural or urban, long distance or local, over good
roads or bad tracks.

34
Overseas Presence:

Force Motors is a highly flexible, vertically integrated automotive company that can cater to all
types of markets, including niche markets, by providing customized 'country specific'
modifications.

Force Motors has a formidable product range in all segments, be it small commercial vehicles,
light commercial vehicles, multi utility vehicles and agricultural vehicles.

Over the last five decades it has partnered with leading global automotive names like Daimler, ZF,
Ricardo, Bosch and MAN. Through these associations it has developed necessary expertise in-
house for design, development and manufacture of automobiles, sub-systems, components and
aggregates.

The company exports its complete range of world class products to various countries in Middle
East, Asia, Latin America and Africa.

35
 THOUGHT PROCESS
Design Inspiration:
We, at Force Motors, endeavour to focus on each of our customer’s requirements and deliver
accordingly. Our customers are at the core of each of our ideal and they inspire us to experiment
and innovate at every step. Our R&D Center is equipped with most advanced CAD center and
computer engineering environment. The centre, with its well equipped computer engineering
environment, gives us ample opportunities to develop novel product designs for our most modern
vehicles. Thanks to our customers due to whom Force Motors has reached this stage of success.

Engineering Expertise:
The new range of our products has been fully engineered and developed in-house by our experts
at the Force Motors’ R & D centre which is considered to be among the most advanced in the
country. The engines designed by Force Motors are fully checked for emission and fuel efficiency.
An elaborate and state of art tool room with the latest high-precision and versatile machines for
manufacturing is created solely for proficient engineering.

Evolving utility:
We focus on the utility of our products and evolve with the times to deliver the unsurpassed. We
have a formidable product range in all segments - from small commercial vehicles, multi utility
vehicles and light commercial vehicles to agricultural tractors. We showcase some innovative
and exclusive products appropriately custom designed for the discerning Indian as well as the
international market.

Delivering Value:
We believe that delivering value through all channels drives growth. Force Motors encourages
innovation and motivates the 500 odd expert design engineers to create path-breaking automotive
designs. At Force Motors, every vehicle is run though durability test lab, engine test lab and
driveline test setups before it hits the road. Apart from test labs Force Motor’s has in house torture
track (Pave Track) for complete vehicle durability testing.

36
Company’s Business:-
The company is engaged in the manufacture of Light Commercial Vehicles, Small Commercial
Vehicles, Utility Vehicles, Agricultural Tractors & other products related to Automobile Industry
such as Diesel Engines.

The company has five plants:-

37
LITERATURE
REVIEW

38
Literature Review
To research any problem, it is necessary to review the existing literature. Various studies relating
to different aspects of recruitment have been conducted in the past. A brief review of some of the
major studies in recent years is given below.

In the fierce era of competition, organizations nowadays are more emphasizing on the management
of Human Resources (Robert. L, 2008). Motivation; a key strategy in Human Resource
Management has helped practitioners largely enough to subject the term "Motivation" for a
discussion. Steers et al. (2004), asserted that employee motivation plays a vital role in the
management field; both theoretically and practically. It is said that one of the important functions
of human resource manager is to ensure job commitment at the workplace, which can only be
achieved through motivation (Petcharak, 2002).

Based on these reasoning, this paper shall include analytical and empirical studies to reveal the
discrepancies and feasibility aspect of the domain, as Rai (2004) put forward; motivation is crucial
for good performance and therefore it is increasingly important to study what motivates employees
for better performance. This section offers a review of literature, which explores the concepts,
types and theoretical aspects including content and process theories, theories of motivation
developed in other psychological areas as well as empirical evidences in organizational contexts.

Motivation is defined as "a human psychological characteristic that add to a person's degree of
commitment. It is the management process of influencing employees' behavior". (Badu, 2005)

Conversely, Bartol and Martin (1998) relate motivation to the force that stimulates behavior,
provide direction to behavior, and underlies the tendency to prevail. In other words individuals
must be sufficiently stimulated and energetic, must have a clear focus on what is to be achieved,
and must be willing to commit their energy for a long period of time to realize their aim in order
to achieve goals.

However, other than motivation being a force that stimulates behavior, Vroom (1964) emphasized
on the 'voluntary actions'. Supported by Steers et al. (2004), Vroom (1964) defined motivation as
"a process governing choice made by persons...among alternative forms of voluntary activity."
Similarly Kreitner and Kinicki (2004) assumed that motivation incorporate those psychological

39
processes that create the arousal, direction and persistence of voluntary actions that are goal
oriented.

Quite differently from the other definitions, Locke and Latham (2004) identified that motivation
influence people's acquisition of skills and the extent to which they use their ability. According to
the authors "the concept of motivation refers to internal factors that impel action and to external
factors that can act as inducements to action. The three aspects of action that motivation can affect
are direction (choice), intensity (effort), and duration (persistence). Motivation can affect both the
acquisition of people's skills and abilities; and also the extent to which they utilize their skills and
abilities" (Locke and Latham, 2004).

In a nut shell, different authors have put forward the concept of motivation differently.
Nonetheless, these definitions have three common aspects, that is, they are all principally
concerned with factors or events that stimulate, channel, and prolong human behavior over time
(Steers et al. 2004).

2.1 Performance
Bititci, Carrie & McDevitt, 1997 define performance management as a “process by which the
company manages its performance in line with its corporate and functional strategies and
objectives”. This definition is often used in management research studies. According to Bititci,
Carrie & McDevitt, it is the objective of that process to provide an integrated control system, where
the corporate and functional strategies are deployed to all business processes, activities, tasks and
personnel, and feedback is obtained through the performance measurement system to enable
appropriate management decisions. The ultimate purpose of that process is to improve company
performance.

Performance measurement is an essential part of the performance management. By measuring,

people transform complex reality into simplified numerical concepts that can be easily
communicated and acted upon (Lebas, 1995). According to Lebas, the simplification of reality by
measuring is the prerequisite of successful management. Similarly, Bititci et al., 1997argue that
performance measurement is at the heart of the performance management process and it is of
critical importance to the effective and efficient functioning of performance management.

Every organization performs its task with the help of resources as men, machine, materials and
money. Except manpower other resources are non-living but manpower is a live and generating
resource. Manpower utilizes other resources and gives output. If manpower is not available then

40
other resources are useless and cannot produce anything. Out of all the factors of production
manpower has the highest priority and is the most significant factor of production and plays a
pivotal role in areas of productivity and quality. In case, lack of attention to the other factors those
are non-living may result in reduction of profitability to some extent. But ignoring the human
resource can prove to be disastrous. In a country where human resource is abundant, it is a pity
that they remain under-utilized. In wording of Oliver Sheldon “No industry can be rendered
efficient so long as the basic fact remains unrecognized that is human.” The people at work
comprise a large number of individuals of different sex, age, socio-religious group and different
educational or literacy standards. These individuals in the work place exhibit not only similar
behaviour patterns and characteristics to a certain degree but also they show much dissimilarity.
Technology alone, however, cannot bring about desired change in economic performance of the
country unless human potential is fully utilized for production. The management must therefore
be aware not only organization but also employees and their needs. The human resource is critical
and difficult to manage. It is because human behaviour is highly unpredictable. It differs not only
from individual to individual but often on the part of same individual at different points of time.
In spite of biological and cultural similarities, human beings not only differ in their appearance but
also in their capabilities based on their background, training and experience. Human resource or a
person at work is the most important component of the undertaking. Management cannot afford to
ignore human resource at any cost. Management is the process of efficiently getting activities
completed with and through other people. The management process includes planning.
Organizing, leading and controlling activities those take place to accomplish objectives. Being a
branch of management, personnel management also performs the same functions towards the 22
achievement of objectives. Different terms are used for personnel management. The different
terms are labour management, labour administration, labour management relations, employee
employer relations, personnel administration, human assets management, human resources
management etc. In simple sense, human resource management means employing people,
developing them, utilizing, compensating and maintaining their services in tune with the job and
organizational requirements.

Employee Performance Every organization has been established with certain objectives to achieve.
These objectives can be achieved by utilizing the resources like men, machines, materials and
money. All these resources are important but out of these the manpower is the most important. It
plays an important role in performing tasks for accomplishing the goals. The question arises that
how these resources are utilizes by manpower. Further, the business environment is changing
drastically. The environmental factors are uncontrollable. These are beyond control of
management of the firms. One has to adjust with the external factors to do the business in the
market. Every environmental factor like social, cultural, legal, political, economic, technology and
competition gets changed very fast. For effective working the knowledge of these factors is must
otherwise the plan will misfire. In present situation it is difficult to predict about anything. It is
uncertain to say that what will happen tomorrow. Again the need for highly skilled and dedicated

41
manpower is felt who can give the best output. Nowadays the markets 28 are also very competitive
and there is cut throat competition. For every organization it is difficult to start, survive, stabilize
and excel in the business. The firm that gets the advantage over other competitors through their
talented and dedicated manpower can take the lead in the market. The contribution of employees
on job is the most important factor for development and excellence in business. The performance
of employees on different jobs in close coordination is needed for success of the unit. Employees
are performing different jobs in an organization depending upon the nature of the organization.
They mainly perform tasks like production, storage, manufacturing, transportation, marketing,
purchasing, distribution, promotion of business, finance and accounting, human resource, research
and public relations. All these activities are inter-related to achieve the targets. These are to be
performed by the employees properly so they can give their best out put at the job. This will have
great impact on the total production, sales, profit, progress and market position of the company in
the market. Various factors like skills, training, motivation, dedication, welfare, management
policies, fringe benefits, salary and packages, promotion, communication etc. are responsible to
encourage the people to work sincerely and give their best output. The importance of employees’
performance must be understood by the management and sincere efforts must be put in that
direction. The management of the company taking timely steps in that direction will be in position
to develop and motivate the people to do so. Finally the company may take the lead the market
and grab the opportunities available in the market. 6. Advantages of Higher Employees’
Performance Following are advantages of higher performance to the individuals, organization,
society and nation as a whole: (a) The productivity of individual on job increases. (b) Employee
gets job satisfaction at job. (c) Psychological problems of employees come to low level. (d)
Involvement of employees in their jobs increases. (e) A sense of commitment and loyalty among
employees develop. 29 (f) Employees get higher salaries and incentives on production basis. (g)
Quality and quantity of the total production increase. (h) Sales and market shares of the company
in the market improves. (i) Profit improves and that leads to progress of the business. (j) Good will
of the organization goes high. (k) All these contribute in the development of national economy and
living standard of the society as a whole. 7. Performance Management The main objective of
human resources management is to utilize the human resources in a most optimal manner so that
targets can be achieved very effectively and efficiently. For this purpose managing performance
of employees as a whole is very important. Performance management takes care of this function.
Performance management maintain, develop and motivate the people at work to give better results.
In the present competitive situation the organasation that gives better results can survive, stabilize,
grow and excel in the performance. It helps a lot in achieving the objectives of HRM. Performance
management includes activities to ensure that goals are consistently being met in an effective and
efficient manner. Performance management can focus on performance of the organization, a
department, processes to build a product or service, employees, etc. This concept has been defined
by various authors as follows: (a) Performance management is the process of creating a work
environment or setting in which people are enabled to perform to the best of their abilities.
Performance management is a whole work system that begins when a job is defined as needed. It

42
ends when an employee leaves your organization. Many writers and consultants are using the term
“performance management” as a substitution for the traditional appraisal system. A performance
management system includes the following actions: (i) Develop clear job descriptions. (ii) Select
appropriate people with an appropriate selection process. (iii) Negotiate requirements and
accomplishment-based performance standards, outcomes, and measures. 30 (iv) Provide effective
orientation, education, and training. (v) Provide on-going coaching and feedback. (vi) Conduct
quarterly performance development discussions. (vii) Design effective compensation and
recognition systems that reward people for their contributions. (ix) Provide promotional/career
development opportunities for staff. (x) Assist with exit interviews to understand WHY valued
employees leave the organization. (b) Performance management is the larger process of defining
what employees should be doing, ongoing communication during the year, linking of individual
performance to organization needs, and the evaluating of appraising of performance. (c)
Performance management involves enabling people to perform their work to the best of their
ability, meeting and perhaps exceeding targets and standards. For successful performance
management, a culture of collective and individual responsibility for the continuing improvement
of business processes needs to be established, and individual skills and contributions need to be
encouraged and nurtured. Where organizations are concerned, performance management is usually
known as company performance and is monitored through business appraisal. (d) Performance
management: A framework that identifies opportunities for performance improvement through use
of performance measures such as standards and indicators. (e) Performance measurement: a
process of assessing the achievement of pre-determined goals and objectives through the
measurement of the following types of indicators: inputs, processes of delivery of activities and
services outputs, and outcomes. . (f) Performance management: Using a set of tools and approaches
to measure, improve, monitor and sustain the key indicators of a business. (g) Performance
management: The process of quantifying, measuring, correcting and reporting system service
levels. 31 (h) Performance management: An empirically based approach to evaluating operational,
clinical and financial segments of a provider. It is a program evaluation methodology to measuring
results by benchmarking internal statistics against those of empirically based standards (i)
Performance management system (PMS) is the heart of any “people management " process in
organization. Organizations exist to perform. If people do not perform organizations don't survive.
If people perform at their peak level organization can compete and create waves. -TVS Rao (j)
Armstrong and Baron (1998) defined it as “A strategic and integrated approach to increasing the
effectiveness of organizations by improving the performance of the people who work in them and
by developing the capabilities of teams and individual contributors” (k) Performance management
is ‘The development of individuals with competence and commitment, working towards the
achievement of shared meaningful objectives within an organisation which supports and
encourages their achievement’ (Lockett,). a. (l) ‘Performance management is managing the
business’ (Mohrman and Mohrman,). (m) Performance management is the process of ‘directing
and supporting employees to work as effectively and efficiently as possible in line with the needs
of the organisation’ (Walters,). (n) Performance management is the process of creating a work

43
environment or setting in which people are enabled to perform to the best of their abilities.
Performance management is a whole work system that begins when a job is defined as needed. It
ends when an employee leaves your organization. The PM approach is used most often in the
workplace but applies wherever people interact— schools, churches, community meetings, sports
teams, health setting, governmental agencies, and even political settings. PM principles are needed
wherever in the world people interact 32 with their environments to produce desired effects.
Cultures are different but the laws of behavior are the same worldwide. 8. Functions of
Performance Management The performance management is mainly concern with the performance
of the people, systems and organization. To achieve this objective performance management
performs a variety of functions. These functions are summarized below:

(a) Create Healthy Work Environment HR or performance manager works with the people. Their
objective is to create an environment of openness, trust, mutual understanding, team spirit and
cooperation. In this environment only the manpower can be utilize more effectively to contribute
to organizational goals. They create environment with the help of HR policies, day to day dealing,
rules and regulations regarding leaves, welfare, promotion, discipline, incentives, training etc. It
creates confidence in persons to work without worry.

(b) Develop Performance Plans Management goes for planning of the job, competencies required
for performing the jobs and standards required for performance of the jobs. It includes job
description, job specification and fixation of job performance standard. Through these plans only
the type of person required can be ascertained.

(c) Selection of Appropriate People To carry out the various types of jobs in the organization
manpower is needed. The required type and number of people are to be selected from the aspirants.
So they may be made available at right place in right time for accomplishment of the tasks at
required time. This is possible through proper recruitment and selection of employees.

(d) Decision Regarding Performance Standard Performance management as a function of human

resource management, The management takes decision regarding the required standards of the
performance in consultation with top 33 level management, head of departments and experts or
consultants. They consider the lowest, highest and average performance of the people at work.
After detail discussion the most realistic standards are fixed by the management.

(e) Plans for Development of Employees Performance management is interested for development
of both employees and organization. With the development of one is the development of both. He
conducts orientation of the persons, provides education, and finds out the need for training and
conduct training programme for development of skills, knowledge and competencies. This can
contribute in improvement of the performance of persons and company.

(f) Measurement of Performance After planning and development activities the next task of
performance management is to measure the performance of the people at work. For measurement

44
of performance the different criteria has been fixed such as output per hour/shift quality of work,
behaviour, discipline, level of commitment etc. This helps to find out the poor and good performers
out of the lot. On the basis of the measurement of performance further remedial action can be
taken.

(g) Conducts Performance Feedback After measurement of performance of all employees the
management finds the slow moving persons. The objective of performance management is to find
out the reasons for slow going. They conduct coaching session for such people and give feed back
to them. They suggest ways to improve their performance also. This clarifies many doubts of the
employees. It helps a lot the persons to understand their caliber and difficulties. Through the
coaching and counseling session the attitude of the employees is changed positive.

(h) Design Compensation, Recognition and Reward System Through performance appraisal
system the slow and fast working persons are identified. As per the output the management designs
the compensation, recognition and reward system. For good performers the incentives are designed
as per the output. They are given better incentives whereas slow working persons may be given
less incentives or may be denied. Good 34 performers’ tasks are recognized by giving appreciation
letter, prizes or rewards. Sometime they may be considered for further promotion also. This keeps
on motivating the people whether a slow or fast working person.

(i) Contributes in developing good will By performing the functions like creating good working
environment, planning for performance, measuring performance, providing performance
feedback, designing suitable compensation, recognition and reward system the management helps
in improvement of the performance as a whole. The work related employees problems are shorted
out. IT gives a sense of confidence and motivation among persons. These persons create publicity
by words of mouth in side and in the public out side. It contributes a lot in creating high goodwill
of the company. Provide promotional/career development opportunities for staff. According to
TVS Rao the performance management system includes the following actions:

(i) Identifying the parameters of performance and stating them very clear.
(ii) Setting performance standards
(iii) Planning in participative ways where appropriate, performance of all
constituents
(iv) Identifying competencies and competency gaps that contribute/hinder to
performance
(v) Planning performance development activities
(vi) Creating ownership
(vii) Recognizing and promoting performance culture.

The relationship between employee motivation and job performance

45
The viewpoint that motivation causes performance comes from human relations theory (Filley et
al., 1976). The relationship between employee motivation and job performance has been studied
for a long period. However, earlier research could not succeed in establishing a direct relationship
between the two (Vroom, 1964). Yet it seems that that the factors do influence each other. Petty et
al. (1984) reviewed the 15 studies Vroom (1964) used in his research and added another 20 more
recent studies; they concluded that employee motivation and performance are indeed related. The
results of their research indicate that the relationship between individual, overall job satisfaction
and individual job performance is more consistent than reported in previous researches (e.g.
Vroom, 1964). And Hackman and Oldham (1976) argue that when employee satisfaction is added,
a circular relationship is formed with performance, satisfaction and motivation. The term
satisfaction is also used by Herzberg (1959); he argues that when intrinsic factors (motivators) are
present at the job, satisfaction is likely to occur as well as an increase in employee motivation.
Amabile (1993) states that work performances are dependent upon the individual’s level of
motivation; the individual’s level of motivation can be intrinsically and/or extrinsically based. It
is also argued that certain job characteristics are necessary in establishing the relationship between
employee motivation and performance (e.g. Brass, 1981; Hackman & Oldham, 1976; etc.). Brass
(1981) argues that when certain job characteristics are present in an organisation, employees are
better motivated and an increase in performance is noticeable.

46
RATIONALE OF
THE STUDY

47
3. Rationale of the study
As Force Motors Ltd.belives that an organisation gets its strength from its employees & the
Company cultivates a corporate culture that truly reflects the qualities of ‘Continuous
Improvement’ & ‘Respect for people in all activities, collective and individual. The Force motors
not only encourage employees to give their suggestions on improving our products, practices &
work environment, but also reward them for their valuable inputs. Hence the present study is to
investigate levels of motivational & personal effectiveness & also to find the impact of motivation
levels on the personal effectiveness of the employees of Force Motors Ltd.

48
 OBJECTIVES OF
THE STUDY

Objectives of the study

 To study the levels of motivation.

49
 To study the levels of employee performance.

 To study the impact of levels of performance and motivation on employee

satisfaction.

50
 RESEARCH
METHODOLOGY

RESEARCH METHODOLOGY

The Study

51
The present study is descriptive & empirical in nature designed to analyze an exploratory study of
employee’s motivation in Force Motors Ltd. Here we try to find out the levels of performance &
motivation of employees & also to find the impact of motivation levels on personal effectiveness
of employees of Force Motors limited in Indore city.

The Study Area

The study will be conducted in Indore.

Tools for Data Collection

A structured & non-disguised type of questionnaire was prepared & administered to 100
employees of Force Motors Limited in Indore {Pithampur} city.

Data Type
The study is based on restoring the primary data.

 The Sample
 Sampling Method
Convenience Sampling & Judgemental Sampling were used for collection of the data.

Sample Size
100 respondents from Indore city are taken. Out of 100 respondents, 50 are male & 50 are
female. All the respondents are employees of Force Motors Limited in Indore city.

Tools for Analysis

The objective was to identifying levels of motivation & performance of employees of force
motors ltd. Also to study the impact of motivation levels on performance of employees. To find

52
the levels of motivation & performance of employees Percentage & Graphical analysis is used.
To study the impact of motivation levels on performance of employees Regression analysis is
used.

53
 DATA ANALYSIS
AND
INTERPRETATION

Data Interpretation

54
 Respondent’s opinion on Employee Performance

Level of Employee No. of Respondents Percentage

Performance
Strongly Disagree 0 0%
Disagree 0 0%
Neutral 5 5%
Agree 80 80%
Strongly Agree 15 15%
Total 100 100%

Table 1: Level of Employee Performance

It was observed from the table I that large proportion of the respondents is agreed that motivation
levels affect the personal effectiveness of employees. About 85% respondents are agree that
motivation affects the performance of employees, 15% of respondents strongly agree about it &
5% respondents are neutral on it. Mostly respondents are agreed that knowledge management
plays a key role in increasing performance of employees, their effectiveness, efficiency, drives
values & ethics in their behavior which leads to patience & problem solving in their work.

3.1 Respondent’s opinion on the motivation

55
 Level of Motivation No. of Respondents Percentage
Strongly Disagree 0 0
Disagree 0 0
Neutral 4 4%
Agree 80 80%
Strongly Agree 16 16%
Total

It was observed from the table that about 80%respondents are agree that motivation is good for
better performance, creates creativity in work place, congenial work climate, sense of
responsibility, trust & dominance among workers which leads to job satisfaction & developing
healthy work culture in the organization . About 16% respondents are strongly agreed on this
view & 4% respondents are neutral on it.

3.2 Interpretation of Regression Analysis

56
 Model R R square Adjusted R Std. Error of
Square the Estimate
1 .752 .565 .505 .56485

a. Predictors: (Constant), Q12, Q6, Q9, Q3, Q7, Q1, Q5, Q10, Q4, Q2, Q8,
Q11.

R indicates correlation among the observed & predictive variable i.e. there is a strong relationship
among the studied values as it is .752. The personal effectiveness is based on motivation that more
the employees is motivated the better will be the performance & they will be more inclined to learn
things because of which they may outperform.

ANOVA
Model Sum of Df Mean Squares F Sig.
Squares
Regression 36.032 12 3.003 9.411 .000a

Residual 27.758 87 .319

Total 63.790 99

a. Predictors: (Constant), Q12, Q6, Q9, Q3, Q7, Q1, Q5, Q10, Q4, Q2, Q8, Q11
b. Dependent Variable: Q13

R Square is 0.56 which indicates that the model fits the data well & the F value is significant
which means motivation does a good job in explaining the variations in employee performance.
F<0.05 shows independent variable do a good job in explaining the variation in performance .For
the period of study the significant value of F is 0.00 that means motivation do a good job explaining
the variation between performance of employees.

R2 indicates that there is a proportion of variation among the variables is 50/50 on either side i.e.
if on go down the other variable is affected by 50% & the predictive line is best fitted in the data
& the data complement each other well.

57
 Unstandardised Standardized
Coefficients
Model Coefficients
B Std. Beta t Sig.
Error
(Constant) .306 .108 2.839 .006

Q1 -.376 .156 -.193 -2.407 .018

Q2 1.471 .475 .991 3.096 .003

Q3 .290 .133 .166 2.181 .032

Q4 .692 .292 .466 2.365 .020

Q5 .488 .131 .296 3.714 .000

Q6 .523 .136 .306 3.836 .000

Q7 .269 .131 .164 2.062 .042

Q8 -1.186 .554 -.771 -2.142 .035

Q9 .577 .135 .313 4.268 .000

Q10 .311 .139 .202 2.234 .028

Q11 -2.467 .622 -1.604 -3.964 .000

Q12 1.068 .429 .695 2.491 .015

58
Coefficients
a. Dependent Variable: Q13

T value indicates that all the variables show randomize behavior hence the value of all the T is
below -2 & above +2, it means all the variables have significant value. The effectiveness of
employee affects the motivation & there is a significant relationship among both variables.

Regression Equation:-

Y=0.306-0.376Q1+1.471Q2+0.290Q3+0.692Q4+0.488Q5+0.523Q6+0.269Q7-
1.186Q8+0.577Q9+0.311Q10-2.467Q11+1.068Q12

59
Conclusion

60
 4. Conclusion

As Force Motors Ltd. Believes that an organization gets its strength from its
employees & the company cultivates a corporate culture that truly reflects the
qualities of ‘Continuous Improvement’ & ‘Respect’ for people in all activities,
collective & individual. The Force Motors not only encourages employees to give
their suggestions on improving our products, practices & work environment, but also
reward them for their valuable inputs.

It was observed that motivation strongly affect the personal effectiveness of

employees of Force Motors Limited. Mostly respondents are agreed that knowledge
management plays a key role in increasing performance & personal effectiveness,
efficiency, drives values & ethics in their behavior which leads to patience and
problem solving in their work.

It was observed from the study that motivation is good for better performance,
creates creativity in work place, congenial work climate, sense of responsibility, trust
& dominance among workers which leads to job satisfaction and developing healthy
work culture in the organization.

61
SUGGESTIONS

62
5. SUGGESTIONS

 The study attempts to extend certain suggestions incorporating the impact of

motivation levels on performance of employees.
 The research may be done on employees of other companies in automobile
industry.
 The study will help in finding out the levels of employee’s motivation &
performance in the organization & creates awareness to the owners about
performance of the employees.
 The research will help to know about how the performance of employees
can be increased with motivation to get more productivity.

63
REFERENCES

64
References & Bibliography

1. Students guide to organization and management Published by RCF publications

Amravati

2. Organization behavior By sultan chand and sons

3. Organization and Management By Tejpal Sheth

4. Business communication and organization and management By Rohini

Aggarawal

5. Organization behavior R. Aswathappa

6. Principles of management T. Ramasamy Himalaya publishing house

7. Bisbe, J., Batista-Foguet, J.-M., & Chenhall, R. H. (2007). Defining

management accounting constructs: A methodological note on the risks of
conceptual misspecification. Accounting, Organizations and Society, 32(7-8), 789–
820.

8. Bititci, U. S., Carrie, A. S., & McDevitt, L. (1997). Integrated performance

measurement systems: A development guide. International Journal of Operations
& Production Management, 17(5), 522–534.

9. PDF: Bourne, M., Neely, A., Mills, J., & Platts, K. (2003). Implementing
performance measurement systems: A literature review. International Journal of
Business Performance Management, 5(1), 1–24.

10. PDF: Chenhall, R. H., & Langfield-Smith, K. (2007). Multiple perspectives of

performance measures. European Management Journal, 25(4), 266–282.

11. PDF: Franco-Santos, M., Kennerley, M., Micheli, P., Martinez, V., Mason, S.,
Marr, B., … (2007). Towards a definition of a business performance measurement

65
system. International Journal of Operations & Production Management, 27(8),
784–801.

12. Grafton, J., Lillis, A. M., & Widener, S. K. (2010). The role of performance
measurement and evaluation in building organizational capabilities and
performance. Accounting, Organizations and Society, 35(7), 689–706.

13. PDF: Henri, J.-F. (2004). Performance measurement and organizational

effectiveness: Bridging the gap. Managerial Finance, 30(6), 93–123.

14. Lebas, M. J. (1995). Performance measurement and performance management:

Proceedings of the 12th International Conference on Production Research.
International Journal of Production Economics, 41(1-3), 23–35.

15. PDF: Neely, A., Gregory, M., & Platts, K. (1995). Performance measurement
system design: A literature review and research agenda. International Journal of
Operations & Production Management, 50(4), 80–116.

16. Neely, A., Gregory, M., & Platts, K. (2005). Performance measurement system
design: A literature review and research agenda. International Journal of
Operations & Production Management, 25(12), 1128–1263.

66
Questionnaire

67
 Questionnaire
1. Overall how satisfied are you working for company?
Strongly disagree Disagree

Neutral Agree

Strongly agree

2. To what extent do you agree with the following statement: I would recommend this
company as a good place to work.

Strongly disagree Disagree

Neutral Agree

Strongly agree

3. What I like best about working for the company is?

4. Things that the company should do to make it a better work place are

68
5. Please indicate the extent to which you agree with the following statement?

a. The company clearly conveys its missions to its employees

Strongly disagree Disagree

Neutral Agree

Strongly agree

b. The company clearly conveys the missions to its clients

Strongly disagree Disagree

Neutral Agree

Strongly agree

c. I agree with the company over all mission.

Strongly disagree Disagree

Neutral Agree

Strongly agree

d. I understand how many job aligns with the company’s missions’

Strongly disagree Disagree

Neutral Agree

Strongly agree

e. I feel like I am a part of the company.

Strongly disagree Disagree

Neutral Agree

Strongly agree

69
6. Overall how satisfied are you working in your department

Strongly disagree Disagree

Neutral Agree

Strongly agree

7. What I like best about working in my department is.

8. Things that my department should do to make it a better place to work are.

9. Please indicate the extent to which you agree with the following statement?

a. My job gives me the opportunity to learn

Strongly disagree Disagree

Neutral Agree

Strongly agree

70
 b. I have the tools and resources I need to do my job

Strongly disagree Disagree

Neutral Agree

Strongly agree

c. I have the training I need to do my job.

Strongly disagree Disagree

Neutral Agree

Strongly agree

d. I receive the right amount of recognition for my work.

Strongly disagree Disagree

Neutral Agree

Strongly agree

e. The amount of wok expected of me is reasonable.

Strongly disagree Disagree

Neutral Agree

Strongly agree

10. Which of the above factor most strongly affects your satisfaction with your work? Why?

71
11. What is your primary work location?

Location 1 Location 2

Location 3 Location 4

Location 5

12. What is your gender?

Male Female

13. What is your age?

18-29 30-49

40-55 55+ year

72