A Study on Performance Appraisal

1

CHAPTER-1

1.1 About the study

An effective study on Performance appraisal of employees at The Dharmapuri District co-

operative milk producers union ltd, krishnagiri-2.as a structured formal interaction between a

subordinate and supervisor, that usually takes the form of a periodic interview (annual or semi-

annual), in which the work performance of the subordinate is examined and discussed, with a

view to identifying weaknesses and strengths as well as opportunities for improvement and skills

development.

Appraising the Performance of the individual, groups and organization is a common practice of

all societies. While in some instance these appraisal processes are structured and formally

sanctioned. In other instances they are an integral and informal part of daily activities. The

teacher evaluates the performance of student, banker evaluates the performance of creditors,

parents evaluate the performance of their of their children and all of unconsciously or

unconsciously evaluate our own action from time to time. In social interaction, performance

evaluation is done in a haphazard an often unsystematic way. But in organization formal

programs of evaluating employee and managerial performance – conducted in a systematic and

planned manner have achieved popularity in recent years.

During and after world war-1 the systematic performance appraisal was quite prominent

credit goes to Walter dill scolt for systematic performance appraisal technique of man to rating

system (or merit rating) it was used for evaluating military officers. Industrial concern also used

this system during 1920 and 1940’s for evaluating hourly paid workers. However with the

increase of training and management development programs from 1950’s management started

adopting performance appraisal for evaluating technical, skilled, professional and managerial

personnel as a part of training and managerial development programs.

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1.2 INTRODUCTION

PERFORMANCE APPRAISAL

Appraising the performance of individual, groups and organizations is a common practice of all

societies. While in some instance these appraisal processes are structured and formally

sanctioned, in other instances they are in informal and integral part of daily activities. Thus

teachers evaluate the performance of students, bankers evaluate the performance of creditors,

parents evaluate the behaviors of their children, and all of us, consciously or unconsciously

evaluate our own actions from time to time. In social interactions, performance is conducted in a

systematic and planned manner to achieve widespread popularity in recent years.

Meaning:

Performance: process of performing a task or function.

Appraisal: assessment/ a formal assessment of the performance.

Performance appraisal is a method of evaluating the skill, efficiency, ability, knowledge,

behavior etc., of employees in the work spot. Normally include in both the qualitative and

quantitative aspects of the job performance. Performance appraisal is the step where the

management finds out how effective it has been at hiring and placing employees. In other words,

performance appraisal may be understood as the assessment of individual’s performance in a

systematic way. The performance being measured against such factors as job knowledge, quality

and quantity of output, initiative leadership abilities, supervision, dependability, co-operation,

judgment, versatility, health, etc. the performance appraisal is considered to be the most

significant and indispensable tool for an organization for the information provides as useful in

making decisions regarding various personnel aspects such as promotions and merit increases. It

is a tool for executive development is an attempt at improving an individual.

3

Definition:

According to “Flippo”, a prominent personality in the field of human resources,

“performance appraisal is the systematic, periodic and an impartial rating of an employee’s

excellence in the matters pertaining to his present job and his potential for a better job,”

performance appraisal is a systematic way of reviewing and assessing the performance of an

employee during a given period of time and planning for his future.

Importance of performance appraisal:

Performance appraisal can achieve and contribute to the management when they are properly

managed:

Assessment and analysis

Appraisal and manager mutual awareness, understanding and relationship

Resolving confusion and misunderstanding.

Clarification, definition, redefining priorities and objectives.

Motivation through agreeing helpful aims and targets.

Motivation through achievements and feedback.

Training needs and learning desires-assessment and agreement.

Identification of personal strength and direct – including unused hidden strength.

Career and succession planning-personal and organizational.

Team roles clarification and team building.

Organizational training needs employee growth and development.

Counseling and feedback.

There are various ways of conducting performance appraisals, and ideas change over

time as to what are the most effective appraisal methods and system. In fact performance

appraisal of all types are effective if they are conducted properly, and better still if the

appraisal process is clearly explained to, agreed by, the people involved well prepare and

well conducted

4

Objectives of performance appraisal:

The objectives of a performance appraisal may be as follows:

A. Evaluative

Compensation

Staffing

Evaluate selection system

B. Developmental

Performance feedback

Future direction

Training needs assessment

Almost all organizations practice performance appraisal in one form or another to achieve

certain objectives. These objectives may vary from organization to organization or even within

the same organization from time to time. It has been found that there are two primary objectives

behind the use of this methodology. One is to use it an evaluation system and second, to use it as

a feedback system.

The aim of the evaluation system is to identify the performance gap. This means that it

helps to determine the gap between the actual performance of the employees and that required or

desired by the organization.

The aim of the feedback system is to inform the employee about the quality of his work

or performance. This is an interactive process by which the employee can also speak about his

problems to his superior.

An effective performance appraisal system should emphasis individual objectives, organizational

objectives and also mutual objectives.

5

From the organizational view point a performance appraisal should generate manpower

information, improve efficiency and effectiveness serve as a mechanism of control and provide a

rational compensation structure. In short the appraisal system establishes and upholds the

principle of accountability in the absence of which organization failure is the possible outcome.

Purpose of performance appraisal:

To create ant to maintain a level of satisfactory level of performance.

To know the performance potential.

To have good internal communication.

To contribute to the employees development and growth.

To help senior to have a proper understanding about subordinates.

To guide to job changes with the help of continuous based on performance.

To provide information for making decisions.

Essential characteristics of an effective appraisal system:

Performance appraisal system should be effective as a number of crucial decisions are

made on the basis of score or rating given by the appraisers, which in turn, is heavily based on

the appraisal system. An appraisal system, to be effective, should possess the following essential

characteristics:

Reliability and validity

Job relatedness

Standardization

Practical viability

Legal sanction

Training to appraisers

Open communication

Employee access to results

6

Who will appraise?

The appraisers may be any person who has through knowledge about the job content,

contents to be appraised, standards of contents and who observes the employee while performing

a job. The appraiser should be capable of determining what is more important and what is

relatively less important. He should prepare reports and make judgments without bias. Typical

appraisers are:

Supervisors

Peers

Subordinates

Self-appraisal

Users of services

Consultants

1.1.2 Chart showing appraiser

When to appraise?

Informal appraisals are conducted whenever the supervisor or personnel managers feel it

is necessary. However systematic appraisals are conducted on a regular basis e.g., for every 6

months or annually. One study of 244 firms found that appraisals were most often conducted

once a year.

Supervisors Peers Subordinates

Users of services Consultants Self-appraisal

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According to another Indian study, eight organizations apprised their supervisory

personnel at their anniversary date of joining. Research has also indicated that appraisals for

development purpose be separated from those for salary administration.

Problems with performance appraisal

The problems inherent in performance appraisal may be listed thus:

Judgment errors

Poor appraisal forms

Lack of rater preparedness

Ineffective organizational policies and practices

Judgment errors:

People commit mistakes while evaluating people and their performance. Biases and judgment

errors of various kinds may spoil the show. Bias here refers to inaccurate distortion of a

measurement. A few of them are:

First impressions(primary effect)

Halo

Horn effect

Leniency

Central tendency

Problems areas of performance appraisal

Recent performance most influential

Focus on outstanding events

Personal feelings-halo effect

Lack of yardsticks

Rater attitudes

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Leniency/stringency error

Similar-to-me error

Central tendency error

First impression error

Racial bias

Focus on longevity

Complacency of managers

Avoiding appraisal problems:

Evaluating individual job performance as a basis for making objective personnel decisions.

Making performance appraisals legally defensible

Use job analysis to develop the appraisal system

Check that the appraisal system is behavior-oriented, not trait-oriented

Have evaluators follow specific written instructions when conducting appraisals

Have evaluators review results with the rates.

Performance appraisal contents of an officer

Attendance

Punctuality

Expression-written & oral

Presentation skills

Job knowledge

Knowledge of related jobs

Ability to get along with others

Technical knowledge/ skills

Reasoning ability

Application of mind

Ability to work under stress

Integrity

Honesty and sincerity

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Effective performance appraisal:

Apart from traditional performance appraisals, there are many different methods of

performances evaluation. The use of these methods depends on the purpose of the evaluation, the

individual, and the environment.

The performance appraisals generally the over-riding instrument, which gathers together

and review all other performance data.

What is to be appraised?

Content appraised may be in the form of contribution to the organization objectives like

productive, cost saving, return on capital etc.

Appraisal method:

Confidential report

Graphical rating scales

Ranking method

Paired comparison method

Forced distribution method

Checklist method

Simple checklist

Weighted checklists

Forced choice

Critical incident method

Essay or free from appraisal

Group appraisal

Behaviorally anchored rating scales

Assessment center

Human resources accounting

Management by objectives(also known as appraisal by objectives)

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Chart no: 1.1.3

Process of performance appraisal

Establish performance standards

Communicate performance to

employees

Measure actual performance

Compare actual performance with

standard

Discuss the appraisal with the employee

If necessary, initiative corrective action

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Establish performance standards;

The first step in the process of performance appraisal is the setting up of the standards

which will be used to as the base to compare the actual performance of the employees. This step

requires setting the criteria to judges the performances of the employees as successful or

unsuccessful and degree of their contribution to the organizational goals and objectives. The

standards set should be clear, easily understandable and in measurable terms. In case the

performance of the employee cannot be measurable, great care should be taken to describe the

standards.

Communicate the standards:

Once sets, it is the responsibility of the managements to communicate the standards to the

employees of the organization. The employees should be informed and the standards should be

clearly explained to them. This will helps them to understand their roles and to know what

exactly is expected from them. The standards should also be communicated to the appraisers or

the evaluators and if required, the standards can also be modified at the stages itself according to

the relevant feedback from the employees or the evaluators.

Measuring the actual performance:

The most difficult part of the performance appraisal process is measuring the actual

performance of the employees that is the work done by the employees during the specified

period of the time. It sis a continuous process which involves monitoring the performance

throughout the year. This stage requires the careful selection of the appropriate techniques of

measurement, taking care that personal bias does not affect the outcome of the process and

providing assistance rather than interfering in an employees work.

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Comparing the actual performance with the desired performance:

The actual performance is compared with the desired or the standard

performances. The comparison tells the deviations in the performances of the employees from

the standards sets. The result can show the actual performances being more than the desired

performances or, the actual performances being less than the desired performances. It includes

recalling, evaluating and analysis of data related to the employees’ performance.

Discussing results:

The result of the appraisal is communicated and discussed with the employees on

one- to-one basis; the focus of this discussion is on communication and listening. The results, the

problem and the possible solutions are the aim of problem solving and reaching consensus. The

feedback should be given with a positive attitude as this can have an effect on the employees’

future performance. The purpose of the meeting should be to solve the problem faced and

motivate the employees to the perform better.

Uses of performance appraisal

The following uses of a performances appraisal

Performance improvement

Compensation adjustment

Placement decisions

Training and development needs assessment

Career planning

Job design error detection

Detection of external factors influencing job performances

Performance deficiencies may be due to family or other pressures.

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Why performances appraisals fail:

A. Guilt : many supervisors feel uncomfortable in making judgments about the

performance of other.

B. Lack of accountability: managers often go through the motions of the performance

appraisal without giving any real thought to the process because they are not held

accountable for the accuracy of the appraisals.

C. Ineffective application of standards: Overrating often results when supervisors do

not have a good grasp of the standards being applied.

D. Fear of hurt feelings: Some supervisors would rather give everyone a high rating

than risk ’’hurting someone’s feeling” by pointing out performance deficiencies.

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1.3 NEED FOR THE STUDY

A performance appraisal (PA) or performance evaluation is a systematic and periodic

process that assesses an individual employee’s job performance and productivity in relation to

certain pre-established criteria and organizational objectives. Other aspects of individual

employees are considered as well, such as organizational citizenship behavior accomplishments,

potential for future improvement, strengths and weaknesses, etc.

The aim of performance appraisal is to encourage employees to set his objectives for the next

time period following his past performance in order to improve his performance on the job.

These objectives should be mutually agreed, for next twelve months, as far as possible every

employee should be aware of transaction objectives, since they provide a basis for individual’s

performance objectives. The other basis is the appraise and the wishes of the employee

himself. In order to set worthwhile defectives, it is necessary.

Effective promotions and transfers,

Assess training needs etc.

These objectives are appropriate as long as the approach in individual is individual.

Appraisal in future would assume system orientation. In system approach appraisal aims

at improving the performance instead of merely assessing it emphasize is not on

individual assessment rewards or punishment but it is on how the work system

affects the individual performance.

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1.4 COMPANY PROFILE

The Dharmapuri District Cooperative Milk Producers' Union has been registered under

Cooperative Societies Act on 29-05-1982 and started functioning with effect from 1-6-1982.

The Tamilnadu Co-operative Milk Producers' Federation Ltd, Chennai, the State Level Apex

Body has handed over the Assets and liabilities charges on 16-11-1982. During that time the

Union had 310 numbers of Milk Producers' Cooperative Societies and 30015 members with an

average milk procurement of 32,207 lits of milk per day. At present the Union is procuring 1,

40,000 Lts per day from 665 Milk Producers Cooperative Societies in the district. 1, 49,000

producer members are involved in the white revolution of the Union.

1.4.1 THE DHARMAPURI DISTRICT CO-OPERATIVE MILK PRODUCERS UNION

LTD, KRISHNAGIRI-2

A HISTORY

1 Date of Registration of the

DDCMPU Ltd/Krishnagiri

29-05-1982

2 Date of starting of the

DDCMPU Ltd/Krishnagiri

16-11-1982

B UNION

1 Area of operation Dharmapuri & Krishnagiri

Revenue Districts

2 Dairy Cooperative Society

status

i) No. of DCS Organized Dharmapuri District 461

Krishnagiri District 281

Total 742

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ii)No. of DCS Functional Dharmapuri District 357

Krishnagiri District 222

Total 579

3 Share capital

i)Authorized Capital Rs.50,00,000

ii)Paid up Capital Rs.24,35,800

4 Present Milk Procurement/

Day

1,10,778 Lits

5 Through BMCC Procurement 53,816 Lits

6 Present Avg. Local sales/day 22,300 Lits

7 Avg.Milk dispatch to Chennai from

FBD/CC/BMCC/Day

77,157 Lits

8 By-Products Manufactured Butter,Ghee,SMP,Khoa,Butter

Milk, Curd,Badam Mix

C MILK HANDLING

CAPACITY

Feeder Balancing Dairy : 1,50,000 Ltrs/ day

Milk Chilling Centre,

Dharmapuri

50,000 Ltrs/ day

Milk Chilling Centre,

Denkanikotta

10,000 Ltrs/ day

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SI.NO DETAILS KRISHNAGIRI DHARMAPURI TOTAL

1 MILK PROCUREMENT

Dairy / Chilling Centre’s 2 1 3

Functioning BMCCS 2 13 15

Functional DCS 222 357 579

Members in Co-op, ambit 63,842 12,446 189,288

Pouring members 8,214 14,767 22,981

Milk Procurement (LLPD) 42,591 68,187 1,10,778

Avg.Local Sales (Lts.) 17,044 5,256 22,300

Milk Supplied to Metro

Dairies(Chennai) (LLPD)

0.36 0.41 0.77

Total Milk Procurement

routes

17 10 27

Animal in Co-op. ambit

i)

Cow

41,598 54,633 96,231

ii) Buffalo 1013 7,214 8,227

TOTAL

42,611

61,847

104,458

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2 INPUT ACTIVITIES

Input routes 4 5 9

DCS covered under Animal

Health cover

222 357 579

Artificial insemination

centers

55 124 179

Artificial inseminations done

/ month

2,852 7,110 9,962

Cases treated 2,989 4,861 7,850

FEEDER BALANCING DAIRY: KRISHNAGIRI

PROCESSING CAPACITY:

Chilling :1.5 LLPD

Separation:1.5 LLPD

Storage : 2.20 LLPD

PRODUCTION CAPACITY:

Butter : 8 MTs / Day

Ghee : 5 MTs / Day

SMP :10MTs / Day

Khova :0.15MTs/Day

CHILLING CENTRE:

Dharmapuri Chilling center

Capacity: 50,000 LPD

Denkanikotta Chilling Centre

Capacity: 10,000 LPD

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MARKETING PARTICULARS

MILK: STANDERSIZED MILK ONLY

Distribution channels for milk:

a) Wholesale dealer (2), Retail Agent (45) : 12,315 liter /day

b) District sales through union booth : 7,355 liter /day

c) Institutional sales : 2,760 liter /day

d) No. of milk distribution route operated at present : 7 routes

e) No. of milk delivery points operated : 92

f) Transport vehicle hired or owned by the union : hired

g) Average transport cost per liter of milk sold : Rs.0.37 / liter

AGENT COMMISSION: MILK

a) Wholesale dealer : Rs. 0.30 / liter

b) Agent commission : Rs. 0.60 / liter

c) No.of zonals : 3( Krishnagiri, Hosur, Dharmapuri)

PRODUCTS MARKETED

Ghee: 5 liter, 1000ml, 500ml, 200ml, and 15 kg

Butter: 500gm, 200gm

SMP: 1kg

Khova: 500gm Bowl, 250gm Bowl, 100gm Pkt & 50gm Pkt.

Hot milk: coffee, tea, badam milk

Curd: 200gm Pkt.

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PRODUCT (OCTOBER’2011)

Wholesale dealer: 6 No’s: Rs.2, 77,300 / month (MRP)

Retailer, agent parlors: 67 No’s: Rs 2, 90,280 / month

Direct sales through union parlor’s: 15 parlors’: Rs.42, 84,544 / month

PROCUREMENT:

The Union is having two Milk Chilling Centers one at Dharmapuri with a capacity of

50,000 it’s per day and another one at Denkanikotta with a capacity of 10,000 Lts per

day. The Union is having a Feeder Balancing Dairy at Krishnagiri and handling

1, 50,000 lits per day.

The milk procured from the Milk Producers Cooperative Societies in the district is

transported to the Feeder Balancing Dairy, Krishnagiri and processed for Local milk

sales and for the conversion of by-products like Butter, Ghee, Skim Milk Powder and

Khova.

1.4.2 The Feeder Balancing Dairy is having the processing capacity as follows-

Milk handling 1.50lakhs its per day

Skim Milk Powder Production 10,000 kgs per day

Butter Production 8,000 kgs per day

Ghee Production 5,000 kgs per day

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1.4.3 ADDRESS FOR COMMUNICATION:

Dharmapuri District Co-Operative Milk Producers' Union Ltd

Contact us

Address:

Dharmapuri District Co-Operative Milk Producers' Union Ltd.,

Salem Main Road,

Kanakamutlu (PO),

P.B.No 13,

Krishnagiri 635 002

Telephone

No’s:

Managing Director: 04343 - 232847/236098; Residence : 9443232679

Feeder Balancing Dairy : 04343 - 236008

Email : [email protected]

mailto:[email protected]

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1.5 INDUSTRY PROFILE

Aavin is the trademark of the Tamil Nadu Co-operative Milk Producers' Federation

Limited, a Tamil Nadu-based milk producer's union. The aim of AAVIN is to procure milk,

process it, chill it, pack and sell it to the consumers.

Aavin comes from Tamil meaning 'from cow'. So 'Aavin paal' translates to cow's milk.

Interestingly the second letter of the Tamil alphabet, AA or, is one of the many one-letter words

in the language.

History:

The Dairy Development Department was established in Tamil Nadu in the year 1958 to

oversee and regulate milk production and commercial distribution in the state. The Dairy

Development Department took over control of the milk cooperatives. It was replaced by the

Tamil Nadu Cooperative Milk Producers Federation Limited in the year 1981.

On February 1, 1981, the commercial activities of the cooperative were handed over to

Tamil Nadu Co-operative Milk Producers' Federation Limited which sold milk and milk

products under the trademark "Aavin”. With many private companies entering the field of dairy,

the Tamil Nadu government is giving high priority to improve the performance of the

cooperatives. Tamil Nadu is one of the leading states in India in milk production with about 14.5

million liters per day.

Headquarters:

The Tamil Nadu Cooperative Milk Producers Federation (AAVIN) is located at

13°9′10″N 80°14′40″E / 13.15278°N 80.24444°E Aavin Illam, Madhavaram Milk Colony,

Chennai.

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Activities:

The Tamil Nadu Co-operative Milk Producers' Federation Limited is an apex body of 17

District Cooperative Milk Producers' Unions. The Federation has four dairy plants at the

following locations in Chennai.

Ambattur with a capacity of 4.00 lakh liters per day

Madhavaram with a capacity of 3.00 lakh liters per day

Sholinganallur with a capacity of 4.00 lakh liters per day.

Ambattur - Product Diary:

These dairies collect milk from District Unions, process and pack in sachets and send for

sale to the consumers in and around Chennai City. The Ambattur product Dairy is also engaged

in the manufacture of milk products such as Yogurt, Ice Cream, Khova, Gulabjamoon,

Buttermilk, Curd and Mysorepak.

Milk Products of AAVIN:

Aavin produces 4 varieties of milk.

Toned milk (3% Fat)

Doubled toned milk (1.5%)

Standardized Milk (4.5%)

Full Cream Milk (6%)

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DISTRICT UNIONS OF FEDERATION:

There are 17 District Co-operative Milk Producers’ Unions functioning in Tamil Nadu,

covering 30 Districts. They are

1. Kancheepuram-Tiruvallur

2. Villupuram

3. Vellore

4. Dharmapuri

5. Salem

6. Erode

7. Coimbatore

8. Nilgiris

9. Madurai

10. Dindigul

11. Trichy

12. Thanjavur

13. Pudukkottai

14. Sivagangai

15. Virudhunagar

16. Tirunelveli

17. Kanyakumari

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OBJECTIVES OF THE DAIRY DEVELOPMENT DEPARTMENT

(1) Assure a remunerative price for the milk produced by the member of the Milk Producers' Co-

operative Societies through a stable, steady and well organized market support.

(2) Distribution of quality milk and milk products to the consumers at reasonable price. Keeping

these objectives in mind, a number of activities are undertaken by the Dairy Development

Department, viz., Provision of free veterinary health cover to all animals owned by the members

of milk cooperatives, implementation of Artificial Insemination Programme, supply of balanced

cattle feed and inculcation of farmers with the modern animal husbandry methods and practices.

DEPARTMENTAL SET UP

The Commissioner for Milk Production and Dairy Development is the Head of the Dairy

Development Department. He is the functional registrar in respect of Dairy Co-operatives in the

State

The Commissioner for Milk Production and Dairy Development exercises all the

statutory powers with regard to the registration of societies, supervision, inspection, inquiry,

disputes, liquidation of milk cooperatives including the District Cooperative Milk Producers'

Unions and Federation under the relevant provisions of the Tamilnadu Cooperative Societies

Act, 1983 and Tamilnadu Cooperative Societies Rules, 1988. While discharging the statutory

functions, the Commissioner for Milk Production and Dairy Development is assisted by the

Deputy Milk Commissioner (Co-operation) in the rank of Joint Registrar of Cooperative

Societies and a Deputy Registrar at the Headquarters besides 23 Deputy Registrars (Dairying) at

the District level by way of conferring the powers of the functional Registrar.

26

1.5.1 Average milk procurement in DCMPUs in lakh liters per day

Year 2001-2002 Rs.17.49

Year 2002-2003 Rs.15.79

Year 2003-2004 Rs.17.26

Year 2004-2005 Rs.20.56

Year 2005-2006 Rs.21.59

Year 2006-2007 Rs.22.10

Year 2007-2008 Rs.21.64

Year 2008-2009 Rs.22.00

Year 2009-2010 (up to June) Rs.22.30

Year 2010-2011 (up to Aug) Rs.24.00

1.5.2 MILK SELLING PRICE:

Govt of Tamilnadu has also revised the selling price of Toned / Standardized / Full

Cream milk in sachets and in AVM units are as detailed below:

New price chart (With Effect From 19-11-2011) Applicable to Chennai only

AAVIN MILK: TARIFF STRUCTURE (in Rs)

Variety Fat

(%)

SNF *

(%)

Monthly Card ** Maximum Retail Price

Existing rate Revised

rate

Existing rate Revised

rate

Toned milk

1 lit

3 8.5 17.75 24.00 20.50 27.00

Tone milk

500 ml

3 8.5 8.90 12.00 10.25 13.50

Standardized milk 500

ml

4.5 8.5 11.00 14.50 13.00 15.50

Standardized milk 500

ml

thro AVM

4.5 8.5 10.75 14.50 10.75 15.50

Full cream milk 500

ml

6.0 9.0 12.00 16.50 14.00 17.50

Double toned

milk 500 ml

1.5 9.0 9.25 11.50 11.00 12.00

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SWOT ANALYSIS OF THE ORGANIZATION

STRENGTHS:

Procurement and Input (P&I) network

Goodwill- Brand network

ISO 9001:2000 certified dairy

Ambience of Union area is most suitable for Dairying.

WEAKNESS:

Advertisement execution in its early stage

Early stages of automation and computerization

Competition

Problematic distribution

OPPORTUNITIES:

Enter rural market

Exports-by developing tetra pack technology

Abundant area availability for milk procurement

THREATS:

Entry of big players

Government policies

Stringent food hygiene policies

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CHAPTER-2

2.1 OBJECTIVES OF THE STUDY:

PRIMARY OBJECTIVE:

To evaluate the effectiveness and towards the performance appraisal system in “The

Dharmapuri District co-operative milk producers’ union Ltd”, Krishnagiri-2

SECONDARY OBJECTIVE:

To evaluate the existing methods of performance appraisal in the milk dairy unit.

To assess the satisfaction level of employees' towards the operational performance

appraisal system and their opinion towards effective performance appraisal system.

To examine the role of performance appraisal in enhancing the motivational level of

employees.

To assess the performance appraisal system in the Dharmapuri District co-operative milk

producers’ union Ltd”, Krishnagiri on 2/7/2012

To understand and evaluate performance appraisal system

29

2.2 Scope of the study

The performance appraisal helps to provide employees with a better understanding of

their role and responsibilities.

Increase confidence through recognizing strengths while identifying training needs to

improve weaknesses.

Improve working relationships and communication between supervisors and

subordinates.

Increase commitment to organizational goals; develop employees into future supervisors;

assist in personnel decisions such as promotions or allocating rewards and allow time for

self-reflection, self-appraisal and personal goal setting.

The study covers employees of “The Dharmapuri District co-operative milk producers

union ltd”, krishnagiri-2.

The target samples of 50 technical employees were selected at random from the same

level.

To increase the productivity by increasing the level of performance.

The programme would help the organization in meeting its future personal need.

The programme will help the employee in their personal group by improving

their knowledge as well as skill.

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2.3 LIMATATION OF THE STUDY

The study is confined to “The Dharmapuri District co-operative milk producers union

ltd”, krishnagiri-2 only

The study was conducted on the assumptions that the information is given by respondents

all are correct.

Sample size is restricted to 50 respondents

Time constraints

Lack of expertise trainer handed in the prosecution of performance appraisal programme.

Lack of feeling in people of against the awareness for the performance appraisal system

31

TOOLS USED FOR ANALYSIS:

Data had been collected through industrial visits. For this following methods were used:

OBSERVATION METHOD:

It is a direct method of study and also has cause effect relationship, the investigator observed

working condition, environment condition, nature of job etc.

INTERVIEW METHOD:

From this inner feelings of respondents will come out and it becomes easy to collect information

about qualitative facts.as it is face-to-face contact between the interviewer and interviewee. This

technique had used by researcher to known some feelings of the respondent from gestures,

glances and facial expression, to observe things from very close.

SCHEDULE METHOD

Schedule is a list of questions, which are asked and filled in by the researcher in a face-to-face

situation. It helps in recording those things, which cannot be memorized. Since all the

information is available in a written manner therefore tabulation and analysis of the data

collected will become easy. In present study interview schedule was used to collect the

relevant data, which comprised the set of 25 questions related with the topic of study.

OTHER SOURCES

Secondary data has been used from reports, studies prior conducted, records, magazines is

published by the organization. All business undertaking operates in the world of uncertainty,

research methodology degree of uncertainty. It may reduce throb ability of making a wrong

choice amongst alternative course of action, research in purposeful investigation in Research;

i t provides a structure for decision-making.

32

2.5 RESEARCH METHODOLOGY

Research Methodology is one main aspects of every research. Methodology is generally a

guideline system for solving a problem. This explains how the researcher conducted problem the

project. The word of method indicates the mode or the way of accomplishing an end. Any

scientific approach should have a method and an outline to be followed to attain a particular goal

through methodological and systematic procedure.

Research Design:

Research design is arrangements of condition for collections and analysis of data in a

manner that aims to combine relevance to the research purpose with economy in procedure. The

research design for the study analytical in nature.

In analytical research, the researcher has to see the facts and information already

Available and analyze these to make the critical evolution of the material.

Collection of data:

Primary data

Secondary data

PRIMARY DATA:

Primary data has collected during the course of doing experiments in an experimental research

but in case we do research of the descriptive type and perform surveys, whether sample surveys

or census Surveys, then we can obtain primary data either through observation or through direct

communication with respondents in one form or another or through personal interviews.

These are several methods of collecting primary data, particularly in surveys and descriptive

Researches.

33

Important ones are: (i) observation method, (ii) interview method, (iii) through questionnaires,

(iv) Through schedules, and (v) other methods which include (a) warranty cards; (b) distributor

audits; (c) pantry audits; (d) consumer panels; (e) using mechanical devices; (f) through

projective techniques; (g) depth interviews, and (h) content analysis.

• The primary data is collected from the respondents of AAVIN (Dharmapuri district co-

operative milk corporation) Limited, Human resource department.

• Secondary data is collected through various books, websites, and company websites and

database. With reference to the primary data will be collected through interaction between the

departmental head officers.

SAMPLING TECHINQUES

Sampling is the process of obtaining information about entire population by examining only

a part of it, Sampling plan calls for three decisions.

a) Sampling unit

b) Sampling size

c) Sampling procedure

The design to be adopted for the study will be based on convenient sampling. The

population for the study will consist of employees in the AAVIN sector from different cities.

Sampling unit:

“The Dharmapuri District co-operative milk producers union Ltd”, krishnagiri-2

34

Simple random sampling

In statistics, a simple random sample is a subset of individuals (a sample) chosen from a larger

set (a population). Each individual is chosen randomly and entirely by chance, such that each

individual has the same probability of being chosen at any stage during the sampling process,

and each subset of k individuals has the same probability of being chosen for the sample as any

other subset of k individuals. This process and technique is known as simple random sampling,

and should not be confused with random sampling a simple random sample is an unbiased

surveying technique.

Simple random sampling is the most intuitive sampling approach. If every household in the

population has some unique identifier, such as a number or the name of the head of the

household, and you know how many households you want to include in the survey sample, then

you could simply write this identifier for each household on a separate piece of paper, put all the

pieces of paper in a bag, shake well, and draw as many from the bag as you need to achieve your

intended sample size. This is simple random sampling.

Simple random sampling:

Involves selection of households which is independent and random

Is the basis for most statistical theory, that is:

o The most common methods to calculate p values and confidence limits

o The output from most statistics computer programmes assume simple random

sampling

Primary data:

Questionnaires

Personal interview

35

Secondary data:

Indirect observation

Library and research works

Internet, web portals and blogs

Books.

Secondary data will be used to analyze the primary data in the light of real world situation.

Analysis of data:

The collected primary data will be analyzed with the help of statistical tools and

techniques.

Data presentation Tools Used:

Primary data was collected through the questionnaire by distributing questionnaires;

questionnaire with both close ended and open ended questions have been used as sample

respondents. On the basis of the tables, the facts are presented in the form of various charts.

Type of the study:

The study is a descriptive study. It is based on data collected through structured

questionnaire from the respondents.

36

2.6 REVIEW OF LITERATURE

The amount of research regarding the topic “Performance Appraisal” is so vast. The topic

is literally not new; it is as old as the formation of the organizations. Before the early 1980’s,

majority of theoretical studies emphasized on revamping the rating system within the

organization.

Lopez, (1968)1 year

The measurement of an employee’s performance allows for rational administrative

decisions at the individual employee level. It also provides for the raw data for the evaluation of

the effectiveness of such personnel- system components and processes as recruiting policies,

training programs, selection rules, promotional strategies, and reward allocations.

Feldman, (1981)2 year

The actions were a great thing to reduce the chaotic of employee’s performance appraisal with

the passage of the time the methods and rating system among the employees got enhanced and

received an immense appreciation and attentions of the managers.

Landy, Zedeck, Cleveland, (1983)3 year

In addition, it provides the foundation for behaviorally based employee counseling. In the

counseling setting, performance information provides the vehicle for increasing satisfaction,

commitment, and motivation of the employee.

Performance measurement allows the organization to tell the employee something about their

rates of growth, their competencies, and their potentials. There is little disagreement that if well

done, performance measurements and feedback can play a valuable role in effecting the grand

compromise between the needs of the individual and the needs of the organization.

Behavioral Observation Scale (BOS) is one of the best techniques utilized by the managers to

arte the employees. The dilemma was on the peak in the 1960s and 1970s.

37

In the same period couple of new innovated rating scales were introduced, which was

Behaviorally Anchored Rating Scale (BARS) and the Mixed Standard Scale (MSS).

The innovations were dominant one which condensed the errors and improved the

observation skills from the performance appraisal practice.

Roberts, (1990)4 year

A Performance Appraisal system is totally ineffective in practice due to the dearth of approval

from the end users

Kressler, (2003)5 year

Rewarding and promoting effective performance in organizations, as well as identifying

ineffective performers for developmental programs or other personnel actions are essential to

effective to human resource management.

Hiromichi Shibata, (2004)6 year

Conducted a study on “Wage and Performance Appraisal Systems in Flux: A Japan-United

States Comparison. Industrial Relations” in Unionized Japanese and American firms made

changes in their wage and Performance appraisal systems during the 1990s that were inspired by

features of each other’s' traditional employment systems. Although Japanese firms made greater

changes in the wage-setting process compared to American firms, outcomes in Japan changed

little. Even with these changes, the wage and Performance appraisal systems in the two countries

retain distinctive characteristics. In the American firms' "segregation" between white- and blue-

collar employees and high- and low performers remains a feature of wage and Performance

appraisal systems; the Japanese system maintained its characteristic "integrated" form, but

underwent moderate modifications.

38

Dalal, R.S, (2005)7 year

Job performance is increasingly being seen to encompass construct such as organizational

citizenship behavior (OCB) and counterproductive work behavior (CWB) to clarify the OCB-

CWB relationship, a meta-analysis was conducted. Results indicate a modest negative

relationship (p=-0.32).the relationship strength did not increase appreciably when then the target

of the behavior (the organization vs. other employee) was the same moreover, OCB and CWB

exhibited somewhat distinct patterns of relationship with antecedents.

Dirk Sliwka & Christian Grund, (2006)8

year

Conduct a study on “Performance Pay and Risk aversion”. The study indicates that risk aversion

has a highly significant and substantial Negative impact on the probability that an employee's

pay is performance contingent.

Samita Gupta & Manisha Agarwal, (2007)9 year

“Participation Climate, Managerial Perceptions and Performance Appraisal Leading to the

Development of the Human Capital in a Private Sector Organization.” This empirical based

study examined the relationship between managerial perceptions of the climate of participation

and the perceived effectiveness of performance appraisal system in a private sector organization

in North India. It was expected that the patterns of relationship between the variables under study

would be positive in the organization. The results focused on the importance of climate of

participation for increasing organizational commitment with the help of a better performance

appraisal system among managerial personnel in Indian organizations. The empirical findings,

therefore, have an implication in development of skills, performance and commitment of the

human capital in organizations. The sample for the present case study belonged to a single

private sector organization in Northern India.

39

Florian P. Ederer, (2008)10

year

Conducted a study on “Feedback and Motivation in Dynamic Tournaments” to examine the

option of organizations to conduct interim performance evaluations in a dynamic tournament

model. The research observed that when workers do not differ in ability or ability does not

influence the marginal benefit of effort, the choice between a full feedback and a no feedback

policy depends on the shape of the cost of effort function. However, when effort and ability are

complementary, feedback policies have two competing Effects: they inform workers about their

relative position in the tournament (evaluation effect) as well as their relative productivity

(motivation effect). In addition, performance appraisals create signal-jamming incentives for

workers to exert effort prior to performance evaluation in order to influence the inference process

of their competitors in the tournament. The choice of the optimal feedback policy therefore

depends on the relative strength of the evaluation, motivation and signal-jamming effects.

Arvind Sudarsan, (2009)11

year

“Performance Appraisal Systems” of 33 diverse organizations. Data was collected from a

respondent from each organization by means of an open-ended questionnaire. Respondents'

views were sought on major concerns, desired changes, and number of forms used in evaluating

performance in the organization. The study observed that subjectivity and appraiser bias were

most common apprehensions in evaluating performance appraisal system in the organization.

Strong needs were felt for identifying measurable parameters for performance evaluation, and

providing multiple feedbacks to trim down appraiser bias. Further, objectivity and measurable

performance were found to be most desirable areas to help improve performance appraisal

system.

40

Archer North, (2010)12

year

Performance appraisal is the process through which an organization gets information on how

well an employee is doing his or her job

Bateman and Snell, (2011)13

year

The first one focuses on motivators such as the nature of the job, duties and responsibilities, and

job satisfaction to determine motivation. The second one known as hygiene factors includes

working circumstances, compensation, supervision and the policy of an organization. The theory

suggests that these factors should adequately be administered in order to motivate employees,

and to serve several HRM purposes such as promotion or termination

41

EXISTING PERFORMANCE APPRAISAL IN THE DHARMAPURI DISTRICT CO-

OPERATIVE MILK PRODUCERS UNION LTD”

PRESENT PERFORMANCE APPAISAL SYSTEMS IN THE DHARMAPURI

DISTRICT CO-OPERATIVE MILK PRODUCERS UNION LTD”

The Dharmapuri District co-operative milk producers union ltd, has adopted a

confidential report (systematic) performances appraisal in its workforce. The performance of

employees is reviewed annually .The performances appraisal report is to send to each

department.

The divisional head will analysis head will analysis performance if the employees who

come under his\her control in that year against in each agreed and assigned area and employees

personal contribution. The appraise also mentions the tasks that could not be completed and the

reasons therefore. The constraints faced and the suggestions for improvement like training, job

rotation, job enlargement, job enrichment etc., He will also mentions the training and

development programs that he has undergone during the past 3 years, training and developmental

needs that he has reviewing employees later screen and self-appraisal submitted by appraise.

The employee evaluates the appraisal based on various potential factors. This evaluation is done

by divisional head. The divisional head will go through the evaluation made by reviewing

employees against each potential factor. The divisional head makes the overall assessment taking

into consideration the job performance and the other relevant factors like job knowledge ,

creativity , planning ,organizing , decision making , achievement of targets ,promptness and

punctuality , quality of work ,personnel skill, interpersonal relations , training and development

of subordinates , leadership ability etc.,

There are four parameter divisional head judge employees -best, good, satisfactory, least (not up

to mark). Divisional head has to give explanation why he has rate was given. Further the

employee also gets a chance to explain rating against least rating. If the explanation is

satisfactory then it is acceptable. Divisional head need not give any explanation to other

parameters.

42

Divisional head, appraises job performance and other relevant factors are overall assessed .The

employee’s integrity is also assessed. If his job performance along with others potential factors is

excellent and his is faultiness. The reporting and reviewing officers will suggest this employee id

fit for promotion/ increment in written format .Later these formats are sent to managing Director

for further necessary actions.

Confidential Report (theory)

It is mostly used in government organizations. It is a descriptive report prepared,

generally at the end of the every year, by the employee’s immediate superior. The report

highlights the strengths and weakness of the subordinate’s .The report is not data based. The

impressions of the superior about the subordinate’s arte merely recorded there. It does not offer

any feed back to the appraise. The appraise is not very sure about why his rating has fallen his

best effort , why others are rated high when compared to him , how to rectify his mistake, if any :

on what basis he is going to be evaluated next year etc. Since the report is generally not made

public and hence no feedback is available, the subjective analysis of the superior is to be hotly

contested .In the recent years, due to pressure from court trade unions, the details of the negative

confidential report are given to the appraise.

43

CHAPTER-3

3. ANALYSIS AND INTERPRATATION

There are approximately say 410 employees working in “The Dharmapuri District-co-operative

milk producers’ union ltd”, Krishnagiri. Out of which 50 non executives were distributed to

them. The analysis and interpretation are as follows;

Table no: 3.1

Awareness about the current appraisal system.

Degree NO.of respondents Percentage (%)

Strongly agree 20 40

Agree 17 34

Disagree 9 18

Strongly disagree 4 8

Total 50 100

Interpretation:

Majority of the respondents are aware of the current performance appraisal system. Among them

half of the employees strongly agree that they are well aware of the current performance

appraisal system. Respondents agree that they are somewhat aware of the current performance

appraisal system, whereas respondents are not at all aware of the current performance appraisal.

44

Chart no: 3.1

Awareness about the current appraisal system.

The graph shows the relative percentage of the response of the employees.

40%

34%

18%

8%

strongly agree

agree

disagree

strongly disagree

45

Table no: 3.2

Performance appraisal is very important to improve ones



Agree 17 34

Disagree 5 10


Total 50 100

Interpretation:

Almost all the employees said that the performance appraisal is the important to improve one’s

performance (90%) respondents strongly agreed with this statement, but other respondents nearly

(10%) of them disagreed to the statement.

46

Chart no: 3.2

Performance appraisal is very important to improve ones


56% 34%

10%

0%

strongly agree

agree

disagree

strongly disagree

47

Table no: 3.3

Performance appraisal system provides adequate feedback



Agree 12 24

Disagree 6 12


Total 50 100

Interpretation:

Majority of the respondents (60%) strongly agree that performance appraisal system provides

adequate feedback while only (12%) of the respondents does not agree to this. (24%) agree to

this statement other (4%) are strongly disagreed the statement.

48

Chart no: 3.3

Performance appraisal system provides adequate feedback


60%

24%

12%

4%

strongly agree

agree

disagree

strongly disagree

49

Table no: 3.4

Performance appraisal is away to discuss ones progress openly, honestly and motivate

employees to perform better



Agree 22 44

Disagree 2 4

Disagree 2 4


Total 50 100

Interpretation:

Nearly half of the employees (52%) said that performance appraisal is way to discuss ones

progress to perform to perform better, while only (4%) of the employees do not agree to this.

And other (44%) are agreed to the statement.

50

Chart no: 3.4

Performance appraisal is away to discuss ones progress openly, honestly and motivate

employees to perform better


52%

44%

4%

0% 4%

strongly agree

agree

disagree

strongly disagree

51

Table no: 3.5

Performance appraisal helps to integrate individual and organizational goal



Agree 12 24

Disagree 6 12


Total 50 100

Interpretation:

More than (58%) of employees strongly agree that performance appraisal helps to integrate the

individual and organizational goals, except for (12%) who do not agree that the performance

appraisal helps to integrate the individual and organizational goals.

52

Chart no: 3.5

Performance appraisal helps to integrate individual and organizational goal


58% 24%

12%

6%

strongly agree

agree

disagree

strongly disagree

53

Table no: 3.6

Personal relationship, likes, dislikes etc. influence performance appraisal ratings


Strongly agree 2 4

Agree 5 10

Disagree 11 22


Total 50 100

Interpretation:

From the above we can analyze that while (14%) of the employees agree that performance

appraisal is influenced by personal influences, (64%) of the employees believe that it depends

only on performance.

54

Chart no: 3.6

Personal relationship, likes, dislikes etc. influence performance appraisal ratings


4%

10%

22%

64%

strongly agree

agree

disagree

strongly disagree

55

Table no: 3.7

Performance appraisal helps to win co-operation and team work.



Agree 29 58

Disagree 3 6


Total 50 100

Interpretation:

It is evident from the responses of the employees that nearly (58%) of the employees agree that

performance appraisal helps in co- operation and leads to team work while (6%) of the

employees disagree to this statement other (36%) are strongly agree to this.

56

Chart no: 3.7

Performance appraisal helps to win co-operation and team work.


36%

58%

6%

0%

strongly agree

agree

disagree

strongly disagree

57

Table no: 3.8

Evaluation of the team performance should be included in performance appraisal



Agree 26 52

Disagree 10 20


Total 50 100

Interpretation:

Out of 50 sample employees majority of the respondents (52%) employees said that the team

performance appraisal should be included in performance only (20%) of the employees do not

agree for that team performance should be included for the evaluation.

58

Chart no: 3.8

Evaluation of the team performance should be included in performance appraisal


24%

52%

20%

4%

strongly agree

agree

disagree

strongly disagree

59

Table no: 3.9

Peers, customers, subordinates, other departmental representatives should be included in

performance appraisal process.


Strongly agree 1 2

Agree 3 6

Disagree 12 24


Total 50 100

Interpretation:

From the above we can analyze that while (8%) of the employees agree that peers, customers,

sub ordinates other departmental representatives should be included in the performance appraisal

(68%) of the employees strongly disagree to this and believe only management should be

included in the process.

60

Chart no: 3.9

Peers, customers, subordinates, other departmental representatives should be included in

performance appraisal process.


2%

6%

24%

68%

strongly agree

agree

disagree

strongly disagree

61

Table no: 3.10

Performance appraisal system helps to identify the strengths and weakness of the

employee.



Agree 23 46

Disagree 11 22


Total 50 100

Interpretation:

More than (46%) of employees agree that performance appraisal helps to identify the individual

strengths and weakness except for (22%) who does not agree to the statement.

62

Chart no: 3.10

Performance appraisal system helps to identify the strengths and weakness of the

employee.


32%

46%

22%

0%

strongly agree

agree

disagree

strongly disagree

63

Table no: 3.11

Performance rating is helpful for the management to provide employee counseling.


Strongly agree 9 18

Agree 25 50

Disagree 13 26


Total 50 100

Interpretation:

Nearly half of the employees (50%) said that performance appraisal is helpful for the

management to provide employee counseling, while only (26%) of the employees do not agree to

this statement.

64

Chart no: 3.11

Performance rating is helpful for the management to provide employee counseling.


18%

50%

26%

6%

strongly agree

agree

disagree

strongly disagree

65

Table no: 3.12

Appraisal system keeps on major achievement and failure or success of the work.


Strongly agree 2 4

Agree 26 52

Disagree 20 40


Total 50 100

Interpretation:

From the above table we can analyze that while (52%) of the employees agree that appraisal

system keeps on the major achievement and failure or success of the work (40%) of the

employees disagree to this statement.

66

Chart no: 3.12

Appraisal system keeps on major achievement and failure or success of the work.


4%

52%

40%

4%

strongly agree

agree

disagree

strongly disagree

67

Table no: 3.13

Transfer, demotion, suspension and dismissal is based on performance appraisal



Agree 27 54

Disagree 6 12


Total 50 100

Interpretation:

It is an evident from the responses of the employees the nearly (54%) of the employees agree

that transfer, demotion, suspension and dismissal is based on performance appraisal while (12%)

of the employees disagree to this statement given.

68

Chart no: 3.13

Transfer, demotion, suspension and dismissal is based on performance appraisal


24%

54%

12%

10%

strongly agree

agree

disagree

strongly disagree

69

Table no: 3.14

Management fixes salary through the performance rating


Strongly agree 3 6

Agree 33 66

Disagree 9 18


Total 50 100

Interpretation:

Nearly half of the employees (66%) said that management fixes the salary based on the

performances rating, while only (10%) of the employees do not agree to this.

70

Chart no: 3.14

Management fixes salary through the performance rating


6%

66%

18%

10%

strongly agree

agree

disagree

strongly disagree

71

Table no: 3.15

The performance appraisal is helpful in reducing grievance among the employees.



Agree 32 64

Disagree 8 16


Total 50 100

Interpretation:

More than (64%) of employees agree that performance appraisal helps to reduce the grievances

of the employees, except for (16%) who do not agree.

72

Chart no: 3.15

The performance appraisal is helpful in reducing grievance among the employees.


20%

64%

16%

0%

strongly agree

agree

disagree

strongly disagree

73

Table no: 3.16

Performance appraisal increases employees’ motivation



Agree 27 54

Disagree 8 16


Total 50 100

Interpretation:

From the above we can analyze that while (54%) of the employees agree that performance

appraisal helps in increases the employees motivation, only (6%) of the employees disagree to

this.

74

Chart no: 3.16

Performance appraisal increases employees’ motivation


24%

54%

16%

6%

strongly agree

agree

disagree

strongly disagree

75

Table no: 3.17

The follow up procedures after performance appraisal is satisfactory



Agree 33 66

Disagree 1 2


Total 50 100

Interpretation:

Out of 50 sample employees majority of the respondents (66%) employees said that the fallow

up system in the performance appraisal system is satisfactory, only (2%) of the employees

disagree to this statement.

76

Chart no: 3.17

The follow up procedures after performance appraisal is satisfactory


32%

66%

2% 0%

strongly agree

agree

disagree

strongly disagree

77

CHAPTER-4

4.1 FINDINGS

1. Majority of the employees are aware of the performance appraisal system.

2. The performance appraisal system followed by the organization is very effective as

majority of the employees are satisfied and have given positive responses.

3. It has been evident from the responses of the employees that the system followed in the

organization has helped them in identifying their strengths and weakness as (46%) of the

employees have strongly agreed in their responses.

4. Performance appraisal system followed in has motivated employees to perform better.

5. More than half of the respondents are aware of the importance of performance appraisal

system in improving one’s performance.

6. The follow up system in “The Dharmapuri District co-operative milk producers’ union

ltd” is very effective as more than half of the employees are satisfied.

7. The system adopted in the “The Dharmapuri District co-operative milk producers’ union

ltd” as helped the employees to integrate individual goals with that the organization and

hence lead them to perform better.

8. The performance appraisal system followed by “The Dharmapuri District co-operative

milk producers’ union ltd” has been successful in finding out the weaker parts of their

employees and has been successful in reducing their grievances.

9. The system has definitely motivated employees to cooperate and work in team.

10. Include supervisors and managers responsible for conducting performance appraisals and

the executive to whom they report.

11. Meeting should be led by experienced facilitator, such as organization’s head of HR,

internal HR person trained as a facilitator or an external consultant

12. Core of the meeting should be done before all performance ratings and compensation

decisions are finalized.

13. Discussion of each employee’s performance rating and the supervisor’s reasons for that

rating.

14. Start with the outliers (extreme lows or highs)

15. ID high performers and why

78

4.2 SUGGESTIONS

1. Performance Appraisal reports must be based on SWOT techniques and provide scope for

further career development in the organization.

2. The performance appraisal report must be done genuinely and should not be based on

biased.

3. For better results 360 degree system of evaluation can also be adopted by the

organization.

4. Performance of the employees should be evaluated taking all the aspects into

consideration and should not be restricted to only one criteria.

5. Performance appraisal is not a one-time affair, for better results the organization should

do the appraisals in frequent intervals.

6. Rating employees based on personal preferences, likes, dislikes must be avoided so that

employees gain confidence on the system of appraisal and are motivated to work hard

and provide results.

79

4.3 CONCLUSION

All the results observed and achieved and achieved during the project clearly indicate

the importance and need of performance appraisal in the organization.

The study reveals that the employees perform their duties well and performance appraisal

continuously, motivate the employees to achieve their goals indirectly helping the organization

to achieve its goals.

Employees should be praised in the public and correct in private government organizations

follow traditional methods like confidential report method, where a superior evaluates an

employee on basis of loyalty, intelligence, character and his work. But this type of method is

often biased, resulting in dissatisfaction and misunderstandings among employees which hamper

their productivity.

People differ in their abilities and their aptitudes. There is always some difference between the

quality and quantity if the same job is done by the different people. Therefore, performance

management and performance appraisal is necessary to understand each employee’s abilities,

competencies and relative merit and worth for the organization. Performance appraisal rates the

employees in term of their performance.

In present scenario, it is impossible for the organization to manage without help of potential

human resource. Hence, the employees’ ability and inability, strengths and weakness etc. has to

be evaluated and appraised periodically. Performance appraisal is one such management tool

which gives unbiased answers to management questions.

Finally, I would like to conclude by saying that this project work has given immense

knowledge about the functioning of Government Organizations. It’s a great advantage to have

good insight about such companies before the end of the course. My suggestions were duly

honored by the management. This has satisfied me to a greater extent and the same time I am

motivated to carry out such projects in future which would enhance my career and the

organization as well.

Documents

A Study on Performance Appraisal