A PRESENTATION

ON

PERFORMANCE APPRAISAL SYSTEM AN ITS

EFFECTIVENESS IN IT INDUSTRY
 INTRODUCTION
Performance appraisal is also known as employee
evaluation, merit rating, employee assessment, etc. It is a
systematic process of appraising an employee’s current and
past performance relative to his/her performance
parameters. The employee’s performance should be based
on organizational expectations and employee’s actual
performance. The idea that performal evaluation improves
employee’s performance is not a new one but it is seen in
the roots of development of mankind. Each person is
motivated when he is told about his actual performance
and accepts what were his/her previous mistakes.
Performance appraisal process may be held annually or
monthly as per needed.
 MEANING OF 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
OBJECTIVES OF PERFORMANCE APPRAISAL
 To review the performance of the employees over a given period of
time.

 To judge the gap between the desired and the actual performance.

 To help the management in exercising organizational control.

 Help to strengthen the relationship and communication between

superiors, subordinate and management –employees.

 To diagnose the strengths and weakness of the individuals so as to

identify the training and development needs of the future.

 To provide feedback to the employees regarding their past

performance.
NEED FOR PERFORMANCE APPRAISAL
 Provide information about the performance ranks basing on which decision
regarding salary fixation, confirmation, promotion, transfer and demotion are
taken based on performance in India Rayon.

 Provide feedback information about the level of achievement and behavior of

subordinates. This information helps about the level of achievement and
behavior of subordinates. This information helps to review the performance of
the subordinate, rectifying performance deficiencies and to set new standards
of work, if necessary.

 Provide information which helps to counsel the subordinate.

 Provide information to diagnose deficiency in employees regarding skill,

knowledge. Performance appraisals determine training and developmental
needs.

 To prevent grievances and in disciplinary activities.

BENEFITS OF PERFORMANCE APPRAISAL SYSTEM

 The benefits typically claimed by those who defend or advocate performance appraisal systems include the following:

 1.Feedback: Performance appraisals provide employees with feedback regarding their performance, usually at least
once a year and often on an interim basis during the year. This leads to reduced errors and waste, increased
productivity, improved quality and service for customers, as well as enhanced employee motivation, commitment, and
a sense of ownership.

 2. Goal setting: Performance appraisal sessions provide an opportunity for discussions that include setting work
related goals and objectives for the individual as well as aligningindividual and organizational goals.

 3. Career management: Performance appraisal sessions also provide opportunity for identifying training and
development needs and discussing career progression opportunities.

 4. Objective assessment: Performance appraisals are made objective through uniform processes and criteria. This
also results in a fair, valid, and legally defensible basis for rewarding and recognizing individual performance.

 5. Legal protection: Performance appraisals afford the corporation legal protection against employee lawsuits for
discrimination and wrongful termination. A candid and perhaps blunt observer might add a final benefit: The formal
performance appraisal system buttresses the organization's hierarchical authority system. It gives the supervising
manager control over some of the carrots and sticks in what is essentially a carrot-and-stick management system.
 IT SECTOR IN INDIA
INFORMATION technology (IT) industry in India has played a key role in putting
India on the global map. IT industry in India has been one of the most significant
growth contributors for the Indian economy. This has projected India‘s image as a
global player in providing world class technology solutions and business services.
The transformation from an agriculture based country to a knowledge based
country has high credentials to IT sector.

IT-ITeS sector in India, with the main focus on increasing technology adoption,
and developing new delivery platforms, has aggregated revenues of USD 124-130
billion. The top 10 IT companies (based on revenue-2014 report) which includes–
TCS, Infosys, Wipro, Tech Mahindra, HCL Technologies, Mphasis, Oracle
Financial Services, Mindtree, Polaris Technology and Rolta India are the trend
setters of the market in many aspects.
 APPRAISAL METHODOLOGY POPULAR IN IT
INDUSTRY
360 DEGREE FEEDBACK
The 360 evaluation feedback method was first used in the 1940s. It is a system or process in which employees receive confidential,
anonymous feedback from the people who work around them. Analogous to the multiple points on a compass, the 360 method provides
each employee the opportunity to receive performance feedback from his or hersupervisor, peers, staff members, co-workers and
customers.
Usually, this tool is used for employees at middle and senior level. The complexity of their roles enables the organization to generate
sufficient data from all stakeholders for a meaningful assessment.
Most organizations that focus on employee development use the 360-degree tool to assess performance and potential of staff and enable
the employees to map their career path based on the feedback. Organizations take 360-degree feedback about an employee before taking a
major decision about the professional's career.

BALANCED SCORE CARD

Balanced Score Card is a strategic planning and management system that is used extensively in business and industry, government, and
nonprofit organizations worldwide to align business activities to the vision and strategy of the organization, improve internal and external
communications, and monitor organization performance against strategic goals. It was originated by Drs. Robert Kaplan (Harvard Business
School) and David Norton as a performance measurement framework that added strategic non-financial performance measures to
traditional financial metrics to give managers and executives a more 'balanced' view of organizational performance. The balanced scorecard
has evolved from its early use as a simple performance measurement framework to a full strategic planning management system.
Balanced scorecard method addresses four business perspectives, which are as follows:

• Financial Perspective

• Customer Perspective

• Learning and Growth Perspective

• Business Process
LINKAGE BETWEEN APPRAISAL SYSTEM AND ATTRITION RATE IN
IT INDUSTRY

 Attrition management has become the strategic focus and

compelling necessity of business today.

 The toughest concern for an HR manager is however the high

attrition rate

 IT industry has one of the highest attrition rate. Appraisal

should be done fairly so that conflict , dissatisfaction and
attrition rate gets reduced.

 The share of attrition due to dissatisfaction in appraisal is also

growing as techie are finding better opportunities at
mushrooming startups and poaching is always there.
 CONCLUSION
Both the appraiser and appraise should realize the principle and use the tool of appraisal
system in a constructive way for the prosperity of the organization.
Both 360 degree feedback and balanced score card has its own loopholes, though these
methods are being used by top IT companies. The satisfaction level of employees towards
these appraisal methods are very low (source: discussions in the HR forums like
citeHR.com) and there is a need of a new appraisal method which prevents these errors
and have the advantages of these methods.
 THANK YOU
NAME- RUKHSAR KHATUN
ENROLLEMENT NO.- A90606417114
PROGRAMME- BBA 4 (C )
COURSE- MINOR PROJECT
COURSE CODE- MSMN100