A STUDY ON METHODS OF PERFORMANCEAPPRAISAL IN STEEL INDUSTRIESFor the partial fulfillment of WBUTBBA (H)

SUBMITED BY: SUPERVISED BY:

SUMANA ROY SOUGATA MUKHARJEE

BBA (H), NCMT, DURGAPUR

Roll No. 14905012065

Reg. No. 121492010286

A division of NSHM Academy Arrah l Shibhtala l Via Muchipara l West Bengal l India l PIN 713212 Phone: +91343253813-15 l Fascimile: +91343 2534025 l www.nshm.com

Department of Management StudiesThis is to Certify that the Study Paper entitled is STUDY ON ROLL AND METHODS OF PERFORMANCE APPRISAL IN STEEL INDUSTRIES a bonfire work carried out by SUMANA ROY holding W.B.U.T. roll number as 14905012065 and registration number as 121492010286 is a student of NSHM College of Management and Technology, Durgapur, in fulfillment for the award of Degree of Bachelor in Business Administration (BBA) under West Bengal University of Technology.This Study Paper has been approved as it satisfies the academic requirement in respect of project work prescribed for the BBA (H) degree.She has adhered to the guidelines chalked out during our consultation while preparing this study paper.The study paper has been found highly satisfactory.I wish her all the best in future.

SOUMEN CHATTERJEESOUGATA MUKHERJEHOD OF MANAGEMENT STUDIES STUDY PAPER GUIDE________________________ ________________________

Declaration Of originality DECLARATIONI SUMANA ROY student of NSHM College of Management & Technology, Durgapur BBA (H) 3rd year, BATCH 2012, roll no.- 14905012065 under WBUT hereby declare that the project entitled STUDY ON METHODS OF PERFORMANCE APPRISAL IN STEEL INDUSTRIES. Is an original work and same has not been submitted to any other institution for the award of my any other degree.

SUMANA ROY

Sr. No. TITLEPAGE NUMBER

1INTRODUCTION5-22

2LITERATURE REVIEW23-26

3NEED OF THE STUDY 27-28

4SCOPE OF THE STUDY 29

5OBJECTIVE OF THE STUDY 30

6RESEARCH METHODOLOGY31-33

7FINDING & ANALYSIS34-46

8CONCLUSION47-48

9BIBLIOGRAPHY49

1 .INTRODUCTION

In the business world investment is made in machinery, equipment and services. Quite naturally time and money is spent ensuring that they provide what their suppliers claim. In other words the performance is constantly appraised against the results expected. When it comes to one of the most expensive resources companies invest in, namely people, the job appraising performance against results is often carried out with the same objectivity .Each individual has a role to play and management has to ensure that the individuals objectives translate into overall corporate objectives of the company. Performance Management includes the performance appraisal process which in turn helps identifying the training needs and provides a direction for career and succession planning. Understanding Performance Management What is Performance?Performance is synonymous with behavior ; it is what people actually do. Performance includes those actions that are relevant to the organizational growth and can be measured in terms of each individuals proficiency (level of contribution). Effectiveness Performance.1. PERFORMANCE MANAGEMENT2. PERFORMANCE MANAGEMENT DETERMINE LINKED TOCORPORATE GOALS3. DETERMINE INDIVIDUALOBJECTIVES LINKED TOCORPORATE GOALSPERFORMANCE APPRAISAL4. LINKEDINCREMENTS/ PERFORMANCE APPRAISALENSURE RESPONSIBILITY ANDACCOUNTABILITY5. ENSURE RESPONSIBILITY ANDACCOUNTABILITY PERFORMANCE INCENTIVES/REWARDS6. PERFORMANCE LINKEDINCREMENTS/ INCENTIVES/REWARDSCORPORATE GOALS CORPORATE GOALSrefers to the evaluation of results of performance that is beyond the influence or control of the individualHow is Performance managed?Good performance by the employees creates a culture of excellence, which benefits the organization in the long run. The activity includes evaluation of jobs and people both, managing gender bias, career planning, and devising methods of employee satisfaction etc. the efforts are to make to generate the individuals aspirations with the objectives of the organization. Organization has to clear the way of career advancements for talented and hard working people. Fear of any kind from the minds of the employees should be removed so that they give best to their organization. Allow free flow of information. Communication network should be designed in such a way no one should be allowed to become a hurdle. This enables the managers to take correct decisions and that too quicklyWhy Performance Appraisal?Todays working climate demands a great deal of commitment and effort from employees, who in turn naturally expect a great deal more from their employers. Performance appraisal is designed to maximize effectiveness by bringing participation to more individual level in that it provides a forum for consultation about standards of work, potential, aspirations and concerns. It is an opportunity for employees to have significantly greater influence upon the quality of their working lives. In these times of emphasis on quality, there is a natural equation: better quality goods and services from employees who enjoy better quality goods and services from their employers. Performance appraisal must be seen as an intrinsic part of a managers responsibility and not an unwelcome and time-consuming addition to them. It is about improving performance and ultimate effectiveness. Performance appraisal is a systematic means of ensuring that managers and their staff meet regularly to discuss post and present performance issues and to agree what future is appropriate on both sides. This meeting should be based on clear and mutual understanding of the job in question and the standards and outcomes, which are a part of it. In normal circumstances, employees should be appraised by their immediate managers on one to one basis. Often the distinction between performance and appraising is not made. Assessment concerns itself only with the past and the present. The staff is being appraised when they are encouraged to look ahead to improve effectiveness, utilize strengths, redress weaknesses and examine how potentials and aspirations should match up .It should also be understood that pushing a previously prepared report across and desk cursorily inviting comments, and expecting it to be neatly signed by the employee is not appraisal - this is merely a form filling exercise which achieves little in terms of giving staff any positive guidance and motivation.

THE APPRAISAL OF PERFORMANCE SHOULD BE GEARED TO:Improving the ability of the jobholder;Identifying obstacles which are restricting performance Agreeing a plan of action, that will lead to improved performance. It is widely accepted that the most important factor in organization effectiveness is the effectiveness of the individuals who make up the organization. If every individual in the organization becomes more effective, then the organization itself will become more effective. The task of reviewing situations and improving individual performance must therefore be a key task for all managers. For appraisal to be effective, which means producing results for the company, each manager has to develop and apply the skills of appraisal These are -Setting standards on the performance required, which will contribute to the achievement of specific objectivesMonitoring performance in a cost effective manner, to ensure that previously agreed performance standards are actually being achieved on an ongoing basis.Analyzing any differences between the actual performance and the required performance to establish the real cause of a shortfall rather than assume the fault to be in the job holder.Interviewing having a discussion with the jobholder to verify the true cause of a short fall, a developing a plan of action, which will provide the performance, required Appraisal can then become a way of life, not concerned simply with the regulation of rewards and the identification of potential, but concerned with improving the performance of the company. The benefits of appraisal in these terms are immediate and accrue to the appraising manager, the subordinate manager/employee, and to the company as a wholINTRODUCTION OF STEEL INDUSTRY Steel is crucial to the development of any modern economy and is considered to be the backbone of human civilisation. The level of per capita consumption of steel is treated as an important index of the level of socioeconomic development and living standards of the people in any country. It is a product of a large and technologically complex industry having strong forward and backward linkages in terms of material flows and income generation. Steel industry was in the vanguard in the liberalisation of the industrial Sector and has made rapid strides since then. The new Greenfield plants represent the latest in technology. Output has increased, the industry has moved up in the value chain and exports have risen consequent to a greater integration with the global economy. The new plants have also brought about a greater regional dispersion easing the domestic supply position notably in the western region. At the same time, the domestic steel industry faces new challenges. Some of these relate to the trade barriers in developed markets and certain structural problems of the domestic industry notably due to the high cost of Commission of new projects. The domestic demand too has not improved to significant levels. The litmus test of the steel industry will be to surmount these difficulties and remain globally competitive.MAJOR PLAYERS OF STEEL IN INDIA PUBLIC SECTOR1. STEEL AUTHORITY OF INDIA LIMITED (SAIL)Steel Authority of India Limited (SAIL) is a company registered under the Indian Companies Act, 1956 and is an enterprise of the Government of India. It has five integrated steel plants at Bhilai (Chattisgarh), Rourkela (Orissa), Durgapur (West Bengal), Bokaro (Jharkhand) and Burnpur (West Bengal). SAIL has three special and alloy steel plants viz. Alloy Steels Plant at Durgapur (West Bengal), Salem Steel Plant at Salem (Tamilnadu) and Visvesvaraya Iron & Steel Plant at Bhadravati (Karnataka). In addition, a Ferro Alloy producing plant Maharashtra Elektrosmelt Ltd. At Chandrapur, is a subsidiary of SAIL. SAIL has Research & Development Centre for Iron & Steel (RDCIS), Centre for Engineering & Technology (CET), SAIL Safety Organisation (SSO) and Management Training Institute (MTI) all located at Ranchi; Central Coal Supply Organisation (CCSO) at Dhanbad; Raw Materials Division (RMD), EnvironmentManagement Division (EMD) and Growth Division (GD) at Kolkata. The Central Marketing Organisation (CMO), with its head quarters at Kolkata, coordinates the country-wide marketing and distribution network.2. RASHTRIYA ISPAT NIGAM LTD. (RINL)RINL, the corporate entity of Visakhapatnmam Steel Plant (VSP) is the first shore based integrated steel plant located at Visakhapatnam in Andhra Pradesh. The plant wascommissioned in August 1992 with a capacity to produce 3 million tonne per annum (mtpa) of liquid steel. The plant has been built to match international standards in designand engineering with state-of- the- art technology incorporating extensive energy saving and pollution control measures. Right from the year of its integrated operation, VSP established its presence both in the domestic and international markets with its superior quality of products. The company has been awarded all the three Internationalstandards certificates, namely, ISO 9001:2000, ISO 14001: 1996 and OHSAS 18001: 1999. RINL was accorded the prestigious Mini Ratna status by the Ministry of Steel, Govt. of India in the year 2006 and the company is gearing up to complete the ambitious expansion works to increase the capacity to 6.3 mtpa by 2009. RINL has prepared a road map to expand the plants capacity up to 16 mtpa in phases.3. HINDUSTAN STEELWORKS CONSTRUCTION LTD.(HSCL)HSCL was incorporated in June 1964 with the primary objective of creating in the Public Sector an organization capable of undertaking complete construction of modern integrated Steel Plants. HSCL had done the construction work of Bokaro Steel Plant, Vizag Steel Plant and Salem Steel Plant from the inception till commissioning and wasassociated with the expansion and modernisation of Bhilai Steel Plant, Durgapur Steel Plant, IISCO (Burnpur) and also Bhadravati Steel Plant. With the tapering of constructionactivities in Steel Plants, the company intensified its activities in other sectors like Power, Coal, Oil and Gas. Besides this, HSCL diversified in Infrastructure Sectors likeRoads/Highways, Bridges, Dams, Underground Communication and Transport system and Industrial and Township Complexes involving high degree of planning, coordinationand modern sophisticated techniques. The company has developed its expertise in the areas of Piling, Soil investigation, Massive foundation work, High rise structures, Structural fabrication and Erection, Refractory, Technological structures and Pipelines, Equipment erection, Instrumentation including testing and commissioning. Thecompany has also specialised in carrying out Capital repairs and Rebuilding work including hot repairs of Coke Ovens and Blast Furnaces and other allied areas of Integrated Steel Plants.

4. MECON LTD.MECON is one of the leading multi-disciplinary design, engineering, consultancy and contracting organization in the field of iron & steel, chemicals, refineries & petrochemicals, power, roads & highways, railways, water management, ports & harbours, gas & oil, pipelines, non ferrous, mining, general engineering, environmentalengineering and other related/ diversified areas with extensive overseas experience. MECON, an ISO: 9001- 2000 accredited company, registered with World Bank (WB),Asian Development Bank (ADB), European Bank for Reconstruction and Development (EBRD), African Development Bank (AFDB), and United Nations IndustrialDevelopment Organisation (UNIDO), has wide exposure and infrastructure for carrying out engineering, consultancy and project management services for mega projectsencompassing architecture & town planning, civil works, structural works, electric, air conditioning & refrigeration, instrumentation, utilities, material handling & storage,computerization etc. MECON has collaboration agreements with leading firms from the USA, Germany, France, Italy, Russia, etc. in various fields. The authorized share capital of the company is Rs. 10,400 lakh (previous year Rs. 4,100 lakh) against which the paid up capital is Rs. 10,313.84 lakh (previous year Rs. 4,013.84 lakh). All the shares are held by the Government of India.

PRIVATE SECTORThe private sector of the Steel Industry is currently playing an important and dominant role in production and growth of steel industry in the country. Private sector steel playershave contributed nearly 67% of total steel production of 38.08 million tonnes to the country during the period April-December, 2007. The private sector units consist of bothmajor steel producers on one hand and relatively smaller and medium units such as Sponge iron plants, Mini Blast Furnace units, Electric Arc Furnaces, Induction Furnaces,Rerolling Mills, Cold-rolling Mills and Coating units on the other. They not only play an important role in production of primary and secondary steel, but also contribute substantial value addition in terms of quality, innovation and cost effective.1. TATA STEEL LTD.Tata Steel has an integrated steel plant, with an annual crude steel making capacity of 5 million tonnes located at Jamshedpur, Jharkhand. Tata Steel has completed the firstsix months of fiscal 2007-08 with impressive increase in its hot metal production. The hot metal production at 2.76 million tonnes is 4.6%more compared to the correspondingperiod of the previous year. The crude steel production during the period was 2.43 million tonnes which is marginally lower than the production of 2.45 million tonneslast year. The saleable steel production was at a lower level during the period April September, 2007 (2.34 million tonnes) compared to the corresponding period of last year(2.36 million tonnes). Tata Steel is continuing with its programme of expansion of steel making capacity by 1.8 million tonnes to reach a rated capacity of 6.8 milliontonnes. The Project is reported to be moving ahead of schedule and is likely to be commissioned by May 2008 against the original schedule of June 2008. The Companyhas planned to take the capacity to 10 million tonnes by the fiscal year 2010. Tata Steels Greenfield projects in Orissa and Chattisgarh are progressing on schedule withplacement of equipment order for Kalinganagar Project in Orissa and commencement of the land acquisition process. Jharkhand Project is awaiting announcement of Relief &Rehabilitation policy of the State Government.2. ESSAR STEEL LTD. (ESL)Essar Steel Holdings Ltd. (ESHL) is a global producer of steel with a footprint covering India, Canada, USA, the Middle East and Asia. It is a fully integrated flat carbon steelmanufacturerfrom iron ore to ready-to-market products. ESHL has a current global capacity of 8 million tonnes per annum (MTPA). With its aggressive expansion plans in India and other parts of Asia and North America, its capacity is likely to go up to 25 MTPA by 2012. Its products find wide acceptance in highly discerning consumer sectors, such as automotive, white goods, construction, engineering and shipbuilding. Essar Steel Ltd., the Indian Company of Essar Steel Holdings Limited, is the largest steel producer inwestern India, with a current capacity of 4.6 MTPA at Hazira, Gujarat, and plans to increase this to 8.5 MTPA. The Indian operations also include an 8 MTPA beneficiation plant at Bailadilla, Chattisgarh which has worlds largest slurry pipeline of 267 km to transport beneficiated Iron Slurry to the pellet plant, and an 8 MTPA pellet complex atVisakhapatnam. The Essar Steel Complex at Hazira in Gujarat, India, houses the worlds largest gas-based single location sponge iron plant, with a capacity of 4.6 MTPA. Thecomplex also houses the steel plant and the 1.4 MTPA cold rolling complex. The steel complex has a complete infrastructure setup, including a captive port, lime plant andoxygen plant. Essar Steel produces highly customized valueadded products catering to a variety of product segments and is Indias largest exporter of flat products, selling closeto half of its production to the highly demanding US and European markets, and to the growing markets of South East Asia and the Middle East. The companys productsconform to quality specifications of international quality certification agencies, like ABS, API, TUV Rhine Land and Lloyds Register. Essar Steel is the first Indian steel companyto receive an ISO 9001 and ISO 14001 certification for environment management practices. Essar Steel utilizes Hot Briquetted Iron-Direct Reduced Iron (HBIDRI) technology supplied by Midrex Technology, USA along with four 150 tonnes DC electric arc furnaces imported from Clecim, France. The Hazira unit of Essar Steel is equipped with 5.5 million tonnes per annum (MTPA) hot briquetted iron plant, 4.6 MTPA electric are furnace, 4.6 MTPA continuous caster, 3.6 MTPA hot strip mill and 1.4 MTPA Cold Rolling Mill. During the year 2007-08, Essar was awarded costs ISO/TS16949 and OHSAS 18000 certification.3. JINDAL STEEL & POWER LTD. (JSPL)Jindal Steel & Power Limited is one of the fast growing major steel units in the country. The Raigarh plant of JSPL has a present capacity of 1.37 million tonne per annum (MTPA) sponge iron plant, 2.40 MTPA Steel Melting Shop (SMS), 1.0 MTPA plant Mill, 2.30 sinter plant, 0.8 MTPA coke oven and a 330 Mega Watt captive power plant. During the year 2006-07, the company produced 1.19 million tonnes of sponge iron, 0.8million tonnes of various steel products, 0.57 million tones of hot metal and 0.21 million tonnes of rolled products. The performance of JSPL during April-October 2007-08 was 0.68 million tonnes of sponge iron, 0.72 million tonnes of steel products (slabs/blooms/billets/rounds), 0.68 million tones of hot metal, 0.27 million tonnes of rolled products and 0.11 million tonnes of plates.

MARKET SHARE OF LEADING PLAYERS IN IRON AND STEEL INDUSTRY

COMPANYPRODUCTION OF STEEL (IN MILLION TONNES)MARKET SHARE(IN PERCENTAGE TERMS)

SAIL13.532 %

TISCO5.211 %

RNIL3.58 %

ESSAR, ISPAT, JSWL8.419 %

OTHERS14.530 %

TOTAL45.1100 %

Therefore, it can rightly be concluded that the liberalization of industrial policy and other initiatives taken by the Government have given a definite impetus for entry, participation and growth of both private and public sector in the steel industry.

METHODS OF PERFORMANCE APPRAISAL:With the evolution and development of the appraisal system, a number of methods or techniques of performance appraisal have been developed. The importance s among them are presented.

Traditional Methods:Graphic Rating Scales:Graphic rating scales compare individual performance to an absolute standard. In this method, judgments about performance are recorded on a scale. This is the oldest and widely used technique .This method is also known as linear rating scale or simple rating scale. The appraisers are supplied with printed forms, one for each employee. These forms contain a number of objectives, behavior and trait based qualities and characters to be rated like quality and volume of work, job knowledge, dependability, initiative, attitude etc.Rating scales are of two types:1.Continuous rating scale2.Discontinuous ScaleIn Continuous order like 0, 1,2,3,4 and 5 and in discontinuous scale, the appraiser assigns the points to each degree .performance regarding each character is known by the points given by the rater. The points given by the rater to each character are added up to find out the overall performance. Employees are ranked on the basis of total points assigned to each one of them.Ranking Method:Under this method, the employees are ranked from best to worst on some characteristics. The rater first finds the employee with the highest performance and the employees with the lowest performance in that particular job category and rates the former as the best and latter as the poorest. Then the rater selects the next highest and next lowest and so on, until he rates all the employees in that group.Paired Comparison Method:This method is relatively simple .under this method, the appraiser ranks the employees with all other employees in the group, one at time.Paired comparison does not force distribution of employees in each department. For instance, if a department has two outstanding employees and six average employees and paired comparison is correctly utilized, then those employees will get a much higher percentage of positive comparison than the other six. Paired comparison method could be employed fairly easily where the number of employees is less.

Forced Distribution Method:The rater may be his employees at the higher or at the lower end scale under the earlier methods. Forced distribution method is developed to prevent the raters from rating too high or too low. Under this method, the rater after assigning the points to the performance of each employee has to distribute his ratings in a pattern to conform to normal frequency distribution.Thus, similar to the ranking technique, forced distribution require the raters to spread their employees evaluations in a prescribed distribution. This method eliminates central tendency and leniency biases. However, in this method, employees are placed in certain ranked within the categories.CHECKLIST METHODS:The checklist is a simple rating technique in which the supervisor is given a list of statement or words and asked to check statement representing the characteristics and performance of each employee. There are three types of checklist methods.I) Simple checklist method:The checklist consists of large number of statement concerning employee behavior. The rater checks to indicate if the behavior of an employee is positive or negative to each statement may appear to be virtually identical in describing the employee. The words or statement may have different meaning to different raters.II) Weighted Checklist:The weighted checklist method involves weighted different items in the Checklist, having a series of statement about an individual, to indicate that some are important than others. The rater is expected to look into the questions relating to the employee s behavior, the attached rating scale (or simply positive/ negative statement where such a scale is not provided) and tick those traits that closely describe the employee behavior.III) Forced Choice Method:This method was developed at the close of World War II. Under this method, a large number of statements in groups are prepared. Each group consists of four descriptive statements concerning employee behavior. Two statements are most descriptive and two are least descriptive of each tetrad. Sometimes, there may be five statement in each group out of which one would be neutral. The actual weight age of the statement are kept secret.

Critical Incident Method:Employees are rated discontinuously, i.e., once in a year or six months under the earlier methods. The performance rated may not reflect real and overall performance as the rater would be serious about appraisal. Hence, a continuous appraisal methodize, the critical incident method has been developed .under this method, the supervisor continuous records the critical incidents of the employee performance or behavior relating to all characteristics in a specially designed. The supervisor rates the performance of his subordinates onhis subordinates on the basis of notes taken by him. Since the critical incident method does not necessarily have to be separate rating system, it can be fruitfully employed as documentation of the reasons why an employee was rated in a certain way.Essay or Free Form Appraisal:This method requires then manager to write a short essay describing each employee s performance during the rating period. This format emphasizes evaluation of overall performance, based on strengths/weaknesses of employee performance rather than specific job dimensions. By asking supervisors to enumerate specific examples of employee behavior, the essay technique minimizes supervisory bias and the halo effect.Group Appraisal:Under this method, an employee is appraised by a group of appraisers. This group consists of the immediate supervisor of the employee to other supervisors who have close contact with the employee s work, manager or head of the department and consultants. The head of the department or manager may be the chairman of the group and the immediate supervisor may act as the coordinator for the group activities. This group uses any one or multiple techniques discussed earlier.Confidential Reports: possessing the employees performance confidentially is a traditional method of performance appraisal. Under this method, the supervisor appraises the performance of his subordinates based on his observation, judgment and intuitions. The supervisor keeps his judgment and report confidentially. In other words, the superior does not allow the employee to know the report and his performance. The superior keep his judgment and report confidentially. In other words, the superior does not allow the employee to know the report and his performance.

Modern Methods:Behaviorally Anchored Rating Scales:The Behaviorally Anchored Rating Scales (BARS) method combines elements of the traditional rating scales and critical incident methods. Using BARS, jobs behaviors from critical incidents - effective and ineffective behaviors are described more objectively. The method employs individual who are familiar with a particular job to identify its major components. They then rank and validate specific behavior for each of the respondents.Assessment Center:This method of appraising was first applied in the German Army in1930.Later, business and industrial houses started using this method. This is not a technique of performance appraisal by itself. In fact, it is a system or organization, where assessment of several individual is done by various experts by using various techniques. These techniques include the methods in addition to in basket, role playing, and case studies ,stimulation in sight, transactional analysis etc.,Human Resource Accounting:Human Resource Accounting deals with cost of and contribution of human resource to the organization. Cost of the employee includes cost of manpower planning, recruitment, selection, induction, placement, training, development, wages and benefits. Employee contribution is the money value of employee service which can be measured by labor productivity or value added by human resource.Management by Objectives:Management by Objectives (MBO) is a process whereby the superior and subordinate managers of an organization jointly its common goals, define each individuals ajor areas of responsibility in terms of results expected of him and use these measures of guides for operating the unit and assessing the contribution of its members. Thus, MBO focuses attention on participative set goals that are tangible, verifiable and measurable. The emphasis is on what must be accomplished rather than how it is to be accomplished.The subordinate and superior jointly determine goals to be during the appraisal period and what level of performance is necessary for the subordinate to satisfactory achieve specific goals.During the appraisal period, the superior and subordinate update and alter goals as necessary due to changes in the business environment.Both superior and subordinates jointly discuss whether the subordinate achieved the goals or not. If not, they should identify the reasons for strike/lock-out, market change etc.

Behaviors Observation Scales (BOS):The appraiser, under this method, measures how frequently each of the behavior has been observed.Appraiser plays the role of observer rather than a judge and provides the feedback to the appraise continuously.i)Maintain objectivityii)Differentiate good performers from poor performersiii)Provides feedback andiv)Identify training needs better than those chosen by other methods.Psychological Appraisal:Psychological appraisals are conducted to assess the employees potential. Psychological appraisals consist of:a)In depth interviewsb)Psychological testsc)Consultations and discussions with the employees,d)Discussions with the superior, subordinates and peers, ande)Reviews of other evaluations.The Psychological appraisal results are useful for decision making about I) employee placement, II) Career-planning and development, and III) Training and development.VI. Result Method:Organizations of the contemporary periods evaluate employee performance based on accomplishments they achieve rather than behavioral factors/traits. Employee accomplishments include sales turnover, number of units produced, and number of customers served, number of complaints settled and the like. Productivity Measures:Under the productivity measures of performance appraisal, employees are appraised based on the ratio of output they turned out to the input they used. Examples sales to employee salary and benefits, number of clients served per day etc. These measures are not free from limitations as measurement of all kinds of output as well as all kinds of input would be difficult.

STEPS OF APPROACH TO CONDUCTING A PERFORMANCE APPRAISAL:

Regular performance appraisals provide a useful opportunity to conduct a check-up on various workforce development issues that may impact on workers effectiveness and wellbeing.Performance appraisals can be used to:Recognize, reward and support effective performanceDevelop and reward effective teamworkIdentify and manage issues likely to impact on retentionMonitor and support workers wellbeing.

2. Literature Review

I. RationalePerformance appraisals are one of the most important requirements for successful business and human resource policy ( Kressler , 2003). 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 (Pulakos, 2003). The ability to conduct performance appraisals relies on the ability to assess an employees performance in a fair and accurate manner. Evaluating employee performance is a difficult task. Once the supervisor understands the nature of the job and the sources of information, the information needs to be collected in a systematic way, provided as feedback, and integrated into the organizations performance management process for use in making compensation, job placement, and training decisions and assignments (London, 2003). After a review of literature, a performance appraisal model will be described in detail. The model discussed is an example of a performance appraisal system that can be implemented in a large institution of higher education, within the Student Affairs division. The model can be applied to tope level, middle-level and lower level employees. Evaluation instruments (forms) are provided to assist you with implementation the appraisal system. II. IntroductionPerformance evaluations have been conducted since the times of Aristotle (Landy,Zedeck, Cleveland, 1983). The earliest formal employee performance evaluation program is thought to have originated in the United States military establishment shortly after the birth of the republic (Lopez, 1968). The measurement of an employees performance allows for rational administrative decisions at the individual employee level. It also provides for the raw data for the evaluation of the effectiveness of such personnel- system components and processes as recruiting policies, training programs, selection rules, promotional strategies, and reward allocations (Landy, Zedeck, Cleveland, 1983). In addition, it provides the foundation for behaviorally based employee counseling. In the counseling setting, performance information provides the vehicle for increasing satisfaction, commitment, and motivation of the employee. Performance measurement allows the organization to tell the employee something about their rates of growth, their competencies, and their potentials. There is little disagreement that if well done, performance measurements and feedback can play a valuable role in effecting the grand compromise between the needs of the individual and the needs of the organization (Landy, Zedeck, Cleveland, 1983). III. PurposePerformance appraisals should focus on three objectives: performance, not personalities; valid, concrete, relevant issues, rather than subjective emotions and feelings; reaching agreement on what the employee is going to improve in his performance and what you are going to do (McKirchy, 1998). Both the supervisor and employee should recognize that a strong relationship exists between training and performance evaluation (Barr, 1993). Each employee should be allowed to participate in periodic sessions to review performance and clarify expectations. Both the supervisor and the employee should recognize these sessions as constructive occasions for two-way communication. Sessions should be scheduled ahead of time in a comfortable setting and should include opportunities for self-assessment as well as supervisor feedback. These sessions will be particularly important for new employees who will benefit from early identification of performance problems. Once these observations have been shared, the supervisor and employee should develop a mutual understanding about areas for improvement, problems that need to be corrected, and additional responsibilities that might be undertaken. When the goals are identified, a plan for their achievement should be developed. The plan may call for resources or support from other staff members in order to meet desired outcomes. In some cases, the plan might involve additional training. The supervisor should keep in contact with the employee to assure the training experiences are producing desired impact (Barr, 1993). A portion of the process should be devoted to an examination of potential opportunities to pursue advancement of acceptance of more complex responsibilities. The employee development goals should be recognized as legitimate, and plans should be made to reach the goals through developmental experiences or education (Barr, 1993). Encouraging development is not only a supervisor's professional responsibility, but it also motivates an employee to pursue additional commitments. In addition, the pursuit of these objectives will also improve the prospect that current employees will be qualified as candidates when positions become available. This approach not only motivates current performance but also assists the recruitment of current employees as qualified candidates for future positions (Barr, 1993). How to arrive? Reasons why need to be done Benefits of productive performance appraisals. - Employee learns of his or her own strengths in addition to weaknesses. - New goals and objectives are agreed upon. - Employee is an active participant in the evaluation process. - The relationship between supervisor and employees is taken to an adult-to-adult level. - Work teams may be restructured for maximum efficiency. - Employee renews his or her interest in being a part of the organization now and in the future. - Training needs are identified. - Time is devoted to discussing quality of work without regard to money issues. - Supervisor becomes more comfortable in reviewing the performance of employees. - Employees feel that they are taken seriously as individuals and that the supervisor is truly concerned about their needs and goals. (Randi, Toler, Sachs, 1992). IV. Pitfalls to AvoidWhen conducting performance appraisals on any level, it is important to keep in mind the common pitfalls to avoid.These pitfalls may include but are not limited to:1. Bias/Prejudice. Race, religion, education, family background, age, and/or sex.2. Trait assessment. Too much attention to characteristics that have nothing to do with the job and are difficult to measure. 3. Over-emphasis on favorable or unfavorable performance of one or two tasks which could lead to an unbalanced evaluation of the overall contribution.4. Relying on impressions rather than facts.5. Holding the employee responsible for the impact of factors beyond his/her control.6. Failure to provide each employee with an opportunity for advance preparation (Maddux, 1993).V. Legal ImplicationsAny performance appraisal system used to make employment decisions about a member of a protected class (i.e. Based on age, race, religion, gender, or national origin) must be a valid system (an accurate measure of performance associated with job requirements). Otherwise, it can be challenged in the courts based on Title VII of the 1964 Civil Rights Act, the Civil Rights Act of 1991 and the Age Discrimination in Employment Act of 1975 (London, 2003).Uniform Guidelines on Employee Selection 1978 is the controlling federal law in the area of performance appraisals. The Equal Employment Opportunity Commission (EEOC) requires that any measurement used to differentiate between employees must be valid and fairly administered. The Americans with Disabilities Act (ADA) suggests that performance appraisals for people with disabilities for people with disabilities will not be conducted any differently than those for other employees. Another important aspect to consider is the employees right to privacy. Employees must have complete access to their personnel files, but others should have controlled access. The records should be accurate, relevant, and current. VI. RewardsEffective reward systems are often hard to establish when creating performance appraisals. The question of how specific the reward, when the reward should be given, and how to reward group efforts can be a tricky subject to master.Our advice on this is to keep it simple. It is important to have an established reward system. However, rewards can be as simple as more autonomy on the job, praise for progress, additional professional development funding, and vacation time.The important aspect to remember when establishing reward systems is to be consistent. If two employees are being evaluated in the same way, their reward opportunities should reflect their evaluation outcomes

3. NEED OF THE STUDY This study helps building progress towards organizational goals.

To help the superior to have a proper understanding about their subordinates.

To ensure organizational effectiveness through correcting the employee for standard and improved

performance and suggesting the changes in employee behavior.

It provides information about the performance ranks.

To provide information this helps to counsel the subordinates.

To facilitate fair and equitable compensation based on performance.IMPORTANCE OF THE STUDY

Performanceappraisalsprovideemployeesandmanagerswithopportunitiestodiscuss areas in which employees excel and those in which employees need improvement. Performance appraisals should be conducted on a regular basis, and they need not be directly attached to promotion opportunities.

Personal AttentionDuring a performance appraisal review, a supervisor and an employee discuss the employee's strengths and weaknesses. This gives the employee individual face time with the supervisor and a chance to address personal concerns.FeedbackEmployees need to know when theirjob duties are being fulfilled and when there are issues with their work performance. Managers should schedule this communication on a regular basis.

Career PathPerformance appraisals allow employees and supervisors to discuss goals that must be met toadvancewithinthecompany.Thiscan includeidentifyingskills thatmustbe acquired, areas in which one must improve, and educational courses that must be completed.

Employee AccountabilityWhen employees know there willbe regularly scheduled evaluations, they realize that they are accountable for their job performance.

Communicate Divisional and Company GoalsBesides communicating employees' individual goals, employee appraisalsprovide the opportunity for managers to explain organizational goals and the ways in which employees can participate in the achievement of those goals.

4. SCOPE OF THE STUDY

The management can identify the employees opinion of the existing performanceappraisal system.

The study can be used to make the present appraisal system more effective andsatisfied among employees.

It could be used to identify training and development needs for the individual andthe organization as a whole.

It isasystematicprocedure ofcollectinginformationin ordertoanalyze and verify a phenomenon.The collection of information has been done through two majorsources:

5. OBJECTIVE OF THE STUDY

1. To examinewhy an appraisalsystem isimportant.

2. Tostudy theeffectivenessoftheexistingperformanceappraisalsysteminaparticular industry.

3. Onthebasisofwhatindustryincreasesalaryandprovidetrainingtoitsemployees. And what is basis of promotion in industry.

4. To understand more andmoreaboutroleof employee andbecomeclearabout his functions.

5. To understand employees own strengths and weaknesses with respect to his role and functions.

6. To analyze the role played byperformance appraisal system inincreasingthe mutuality between employee and his superiors.

Whatopportunitiesareprovidedbytheperformanceappraisalsystemtotheemployees for self reflection and individual goal setting

6. RESEARCH METHODOLOGY

The formidable problem that follows the task ofdefining the research problem is thepreparation the design of theresearch project, popularly known as the research design. Decisions regarding what, where, when, how much, by what means concerning an inquiry or a research study constitute a research design.A research design is the arrangement of conditions for collection andanalysis data in a manner that aims to combine relevance to the research purpose with economy in procedure. In fact, the research design is the conceptual structure within which research is conducted; it constitutes the blueprint for the collection, measurement andanalysis of data. As such the design includes outline of what theresearcher will do from writing the hypothesis and its operational implications the final analysis of data. Therefore, this study outline following designing decisions:-

(i) What is the study about?Thestudycomprisescriticalanalysisofvariousfunctions,methodsandscopeofperformance appraisal in different companies prevailing in steel industry.

(ii) Why is the study being made?Themainpurposeofstudyis tohelpinunderstandingvariousfunctions,roleandimportance ofperformance appraisal system and identify the developmental needs ofemployees in steel industry. It also focus on the impact of performance appraisal systemonindustrialrelationsandhelpinfindingoutvarioustoolsforbridgingthecommunication gap between employees and supervisors.

(iii) What type of data is required?Data comprising the impact of performance appraisal system on steel industry is requiredforthestudy.Therefore,journalarticlesandnewsarticlefromleadingbusinessmagazines and news papers did the needful.

(iv) Where can the required data be found?Since data is secondary therefore most of the review was done with help of internet,journals, newspaper articles and various books .

(v) What periods of time will the study include?This study is the result of 2 3 months of research.

(vi) What techniques of data collection will be used?To accomplish the objectives of thestudy secondary data is used.

(vii) How will the data be analyzed?Data is analyzed on the basis of journal, newspaper articles and the core knowledge gained on performance appraisal system from few books and steel industry. A complete review has been done on role of performance appraisal system on steel industry and its impactingaining competitive advantages.Therefore,forthispurposeroleofperformance appraisal has been studied in few companies prevailing in the steel industry.(vii) In what style will the report be prepared?Report is distributed in Chapters completing all the requirements ofthe research.TRENDS IN PERFORMANCE APPRAISAL SYSTEMPerformance appraisal in its traditional from known as ACR-Annual Confidential Report is often misused than used. Performance appraisal has now been recognized as a HRD function. In the last decade many organizations have reviewed and changed theirmanagerial appraisal systems.

1) Thereisatrendawayfromthecompositeappraisalswithmultipleobjectives(e.g.performance planning, development rewards andpromotions)to separate systems for different systems for different clusters of objectives.

2)There isamove awayfromisolatedappraisalsystemtothebusinesslinked one. 3)Thereisshiftawayfromclosedconfidentialtypetoopendialogueanddiscussionsbased system.

4)Thereisamovementquantitative(pseudoobjective)toqualitative(interactive,improvement and process oriented) system. 5)Thereisamovementawayfrombossassessedfeedbackto360-degreesfeedbackinvolving customers, peers, team members, subordinates etc. inaddition to supervisors.

6)Thereisalsoatrendawayfromelaboratesystemstosimpleones.7)Thereisashiftfromstandardsystemstoflexibleand groupspecificones.8)There is a movement from result oriented systems to process oriented system.

9)Thereisamovementfromtheassessmentofindividualperformancetothedevelopment of team performance.

10) There is also a movement from complacency to experimentation through continuous research change.

7. FINDING & ANALYSISThe main objective of this study is to analyse the role of performance appraisal and system implementation in Steel Industry. Since the research is empirical in nature thats why following aspects of various organization structure and design of particular industry have been covered.ORGANIZATION STRUCTURE AND DESIGNJindal brothersJindal Brothers is a young, dynamic organization and is going strong on the stock market.1- The company is well aware of the dynamic environment of software, it is operating and in order to keep it with the pace of the environment it believes in constant up gradation of courses. Organization structure and design of the company is such that it supports this change.2- Jindal Brothers has a matrix kind of a structure wherein it takes the form of combination of structures. Matrix structures are adopted became there is more than one factor around which the structure can be built.3- This matrix structure at Jindal Brothers improves the quality of decision-making where interest conflicts arise and direct contacts replaces bureaucracy4- . This increases the motivation of the managers and development of wider involvement in strategies. Although at times the company faces high risk of dilution of priorities became e people do not know who is responsible for what.5- An organization is a network of authority, responsibility and relationships. Different organization structure consists of different type of relationships.

Performance Appraisal at Jindal BrothersWhile on the job, performance reviews of every employee are done every quarter. The reviews are done with a view to helping the individual excel at his/her workplace. In case there are any training requirements, these are noted and acted upon in the coming quarter. Also, the goals and objectives for the employee are re-visited forThe performance appraisal mechanism is carried out at Jindal Brothers for promotional purposes.These are done so as to motivate the employee and improve his performance level. The method is as follows:a) Establishment of performance standards with the employeesb) The goals are set mutually as per measurable standards.c) The actual performance is hence measured.d) After measuring of the actual performance, the same is compared with the standards sete) The appraisal is then discussed with the employees.f) And finally, if need arises corrective action is initiated. For this purpose the corrective action is actually identified through brainstorming exercises initiated by the departmental heads at all the Jindal Brothers. It is then measured as a tool to evaluate the past performances of the employees. Some of the methods used at Jindal Brothers are:1. Key Performance Index2. 360 Degree Feedback3. Paired Comparisons4. Behaviorally Anchored Rating Scale1. KPI-Key Performance IndexIt is based on the performance level of the employee generally classified on the basis of: Targets achieved Ratings through students feedback forms Punctuality and regularity Day to day performanceThis is given after every module at the centers.Thus we can observe that the appraisal system is not a biased one but based on performance and productivity basis. All the respective heads of the employee together with the senior persons at the center brainstorm and then give the promotion.

2. 360 Degree FeedbackThis feedback system involves the participation of: Coworkers 40% Subordinates - 20% Superior - 40%Thus the feedback given by these members at Jindal Brothers is considered under a holistic view and then the employee is given a performance appraisal. This evaluation method involves 40% feedback from the coworkers which says that the employee should not only maintain good rapport with the senior or junior but majorly with the coworkers also.3. Paired ComparisonsThe evaluator compares all possible pairs of subordinates on their overall ability to do the job. Due to the subjectivity of evaluating overall performance some managers me e a number of different job related dimensions when comparing.4. Behaviorally Anchored Rating Scale (BARS)It is a sophisticated method of evaluating the employee based on the employee behavior. It is a numerical scale that is anchored by the seniors of the organization at various centers. This is highly confidential and the information is sent in sealed envelopes and opened only at the time of the final evaluation. There is no further discussion regarding this scaling, thus it is not given enough weightage.

Steel Authority of India LtdBasically there are two types of performance appraisal done on the basis of post of the SAILs employee. They are:1. Executive performance appraisal system2. Non-executive performance appraisal system

Executive Performance Appraisal System :-This system is for performance appraisal for executives of the level E-0 to E-4 . The various steps involved are:A) Self Appraisal Performance Review & Planning :I. Appraisee write his view over the actual achievement for the Key performance area / Task and Target assigned to him for the year.II. Comments on fulfillment of KPA / Task and Target are written by the Reporting Officer , taking account of time frame also.III. Special Jobs other than tasks given and normal routine work are written by appraisee.B) Performance Review Discussion :I. Both appraisee and reporting officer sit together.II. Comment over Strengths and weaknesses and areas for development are written which is undersigned by both .III. Appraisee can help the reporting officer by giving examples which shows his strength or weakness. He also tell what training he want to undergo .

C) Performance Assessment :I. Rating between 1 to5 are given to the appraisee by the Reporting Officer and Reviewing Officer individually on the basis of Performance Factors and Potential Factors. Performance Factors :Quantity of output Quality of output Cost control Job Knowledge and Skill Team spirit and Lateral Coordination Discipline Development & Quality of assessing subordinates Special Relevant factorPotential Factors : Communication Initiative Commitment and sense of Responsibility Problem Analysis and Decision making Planning and Organizing Management of Human resourcesII. Different weightage are given to each factorIII. Final scores are calculated by multiplying rating and weightage .By adding these Total Factor Score is calculated.IV. Comments on Overall Performance And Potential are written by both Reporting and Reviewing Officers individually.

D) Suggestions for Job Rotation and Job EnrichmentI. Both reporting and reviewing officers write their suggestions whether the appraisee should be transferred to other department. Either a good employee is transferred so that he can acquire knowledge of all the departments, or a worst performing employee is transferred so as to improve his performance.II. In some exceptional case Head of department give his comments on overall performance & potential of the employee.E) Final AssessmentI. Total Factor Score by both Reporting and Reviewing officers is written and average is calculated.II. Final Grading between O / A / B / C is given .III. If Final Grade is C , indicate whether to promote or not to promote the appraisee.IV. If not to promote give reasons.V. Meeting with non-promotable appraisee.VI. Non Executive Performance Appraisal SystemI. Rating are given by both Reporting and Reviewing officers on the basis of performance of the appraisee depending upon factors: Performance on the JobJob Knowledge & skillMulti-skill UtilizationConduct & behavior Punctuality & availability on jobInnovativenessCost & Quality ConsciousnessInitiative & Capacity to assume higher responsibilityHousekeeping & safety consciousness

II. Weightage are given to various factors .III. Scores out of 100 are calculated by multiplying rating with weightage .IV. O / A / B / C / C- Grades are given according to scores and attendance of the appraisee.V. If grade is C- , then appraisee is interviewed by the Head of Department.

Key Observation (s) at SAILIn the present performance appraisal system of SAIL we found the following loop holes: If the appraisee has good terms with the reviewing officer and does not have a smooth relationship with the reporting officer, in such case the reporting officer is sometimes forced by the reviewing officer to give better score to the appraisee.

SURVEY FindingsIn this section, basic data for the number companies constituting steel in industry is presented on various attributes of performance appraisal.Frequency and frequency percent scores were computed for each company and thus it enlighten the following points :- Promotions were and known to most of the top and senior management while middle and lower management were a bit not clear about it. This could be attributed to the fact that senior and top management were more involved in decision making and policy formulation than are the middle and lower management.

At the lower levels of the organization, performance can be quantified, and the managers are made accountable at the higher echelons the tasks are too complex and therefore cannot be assessed on the basis of quantified performance

Most of the managers feel that the mechanism for potential appraisal is not adequate.

The industry believed that self appraisal is the best for managers and above.

To improve interpersonal communication and behavior assessment by peers and subordinates is essential. The performance of the employees is not regularly monitor and the required feedback is provided to the subordinates from time to time. The appraisals are conducted at fixed intervals. The industry believes in using appraisal for rewarding and increments. It would not be wrong to say that interpersonal relations and personal biases (i.e. liking and disliking) influence the appraisals in the industry.

CONTRIBUTION OF COUNTRIES TO GLOBAL STEEL INDUSTRYThe countries like China, Japan, India and South Korea are in the top of the above in steel production in Asian countries. China accounts for one third of total production i.e. 419mton, Japan accounts for 9% i.e. 118 m ton, India accounts for 53m ton and South Korea is accounted for 49m ton, which all totally becomes more than 50% of global production. Apart from this USA, BRAZIL, UK accounts for the major chunk of the whole growth.Country Wise Crude Steel Production

COUNTRYCRUDE STEEL PRODUCTION(mtpa)

China272.5

Japan112.7

United States98.9

Russia65.6

South Korea47.5

Germany46.4

Brazil32.9

India32.6

Italy28.8

STEEL INDUSTRY IN INDIASteel has been the key material with which the world has reached to a developed position. All the engineering machines, mechanical tools and most importantly building and construction structures like bars, rods, channels, wires, angles etc are made of steel for its feature being hard and adaptable. Earlier when the alloy of steel was not discovered, iron was used for the said purposes but iron is usually prone to rust and is not so strong. Steel is a highly wanted alloy over the world. All the countries need steel for the infrastructural development and overall growth. Steel has a variety of grades i.e. above 2000 but is mainly categorized in divisions steel flat and steel long, depending on the shape of steel manufactured. Steel flat includes steel products in flat, plate, sheet or strip shapes. The plate shaped steel products are usually 10 to 200 mm and thin rolled strip products are of 1 to 10 mm in dimension. Steel flat is mostly used in construction, shipbuilding, pipes and boiler applications. Steel long Category includes steel products in long, bar or rod shape like reinforced rods made of sponge iron. The steel long products are required to produce concrete, blocks, bars, tools, gears and engineering products. After independence, successive governments placed great emphasis on the development of an Indian steel industry. In Financial Year 1991, the six major plants, of which five were in the public sector, produced 10 million tons. The rest of India steel production, 4.7 million tons, came from 180 small plants, almost all of which were in the private sector. India's Steel production more than doubled during the 1980s but still did not meet the demand in the mid-1990s, the government was seeking private-sector investment in new steel plants.Production was projected to increase substantially as the result of plans to set up a 1 million ton steel plant and three pig-iron plants totalling 600,000 tons capacity in WestBengal, with Chinese technical assistance and financial investment. The commissioning of Tata Iron & Steel Company's production unit at Jamshedpur, Bihar in 1911-12heralded the beginning of modern steel industry in India. At the time of Independence in 1947 India's steel production was only 1.25 Mt of crude steel. Following independenceand the commencement of five year plans, the Government of India decided to set up four integrated steel plants at Rourkela, Durgapur, Bhilai and Bokaro. The Bokaro plantwas commissioned in 1972. The most recent addition is a 3 Mt integrated steel plant with modern technology at Visakhapatnam. Steel Authority of India (SAIL) accounts forover 40% of India's crude steel production. SAIL comprises of nine plants, including five integrated and four special steel plants. Of these one was nationalized and two wereacquired; several were set up in collaboration with foreign companies. SAIL also owns mines and subsidiary companies.

TRENDS IN PERFORMANCE APPRAISAL SYSTEMPerformance appraisal in its traditional from known as ACR-Annual Confidential Report is often misused than used. Performance appraisal has now been recognized as a HRD function. In the last decade many organizations have reviewed and changed their managerial appraisal systems. 1) There is a trend away from the composite appraisals with multiple objectives (e.g. performance planning, development rewards and promotions)to separate systems for different systems for different clusters of objectives.2) There is a move away from isolated appraisal system to the business linked one .3) There is shift away from closed confidential type to open dialogue and discussions based system.4) There is a movement quantitative (pseudo objective) to qualitative (interactive, improvement and process oriented) system.5) There is a movement away from boss assessed feedback to 360-degrees feedback involving customers, peers, team members, subordinates etc. in addition to supervisors.6) There is also a trend away from elaborate systems to simple ones.7) There is a shift from standard systems to flexible and group specific ones.8)There is a movement from result oriented systems to process oriented system.9) There is a movement from the assessment of individual performance to the development of team performance.10) There is also a movement from complacency to experimentation through continuous research change.Performance appraisal refers to the assessment of an employees actual performance, behavior on jobs, and his or her potential for future performance. Appraisal has several objectives but the main purposes are to assess training needs, to effect promotions, and to give pay increases. Appraisal of performance proceeds in a set pattern. The steps involved are defining appraisal objectives, establishing job expectations, designing the appraisal programme, conducting performance interview, and using appraisal data for different HR activities. Two important contemporary techniques of performance appraisal include 360 appraisal and goal setting approach to appraisal also known as Managing by Objectives. However, performance appraisal system also serves to be the backbone of any industry in the corporate world and since the project report focuses on the role played by performance appraisal in industrial establishment so review of research is done by also analyzing following secondary data.The data source: Secondary Data.The research approach: Survey Method.The research instrument: Journals , Books , Newspaper Articles.

8. CONCLUSIONS

1) This industry proves that a major amount of work towards developing an effective and efficient performance appraisal system has not been accomplished to the fullest.2) It seems that the industry is genuinely interested in improving the efficiency andutilityofperformanceappraisalsystemtosucceedintodaysdynamic environment;3) Systems of innovative HRM practices have large effects on production workersperformance, while changes in individualemployment practices have little or no effect.

Outward Orientation Performance Appraisal System

The appraisal system should be more sensitive and responsive to current competitive environment. This is possible through making the industry :Quality conscious in products and services to matchinternational standards.

Customer oriented (internally as well as externally)

Cost effective

Technology oriented

Focused towards collaboration and teamwork

People oriented

Focused towards performance standards

Focused towards values and culture that would help un bottle hidden talent .In achieving the above,the PA system have a catalytic role to play.

PERIODIC PERFORMANCE REVIEW AND PLANNING:

There should be someaspect in the PA forms, which deals withthe effect of Internal Influences, organizational influences and external influences on performance ofemployee to make the PA system more sensitive to changes.

Increase awareness of company goals in orderto integrate company and individual expectations.

Conducting training workshops for appraisers to remove biases anderrors in appraisal.Increasing transparency and open communication and minimizing confidentiality inperformance review discussions .The work done towards modifying anddeveloping performance appraisal systems, time to time should be continued.Integrating TQM into Performance AppraisalIndividual rewards should be declined with thePA system. The focus should shift to team rewards. To recognize individual excellence, the team rewards. To recognize individual excellence, the teamshould recommend rewards to tone upmotivation levels in the entire team.Continuous feedback and transparency inevery systemFocus on customer delight, both internal and external

Linkage with RewardsGood performers should be recognized and rewarded, whereas weak performers need tobe encouraged tobecome better performers. PA systems when liked with individual rewards and promotions create more problems thanthey help in motivating people. They encourage fewer employees and discourage more. They do not develop the team spirit but rather enhance interpersonal comparisons and power politics. The focus should be shifted from rewarding the performance of few to development of performance of many. However there is also a needfor recognition and rewarding good work. Alternative systems of rewarding with multiple reward/recognition mechanism are needed. Butthese systems should be separated from other systems (like career planning).

9. BIBLIOGRAPHY

BOOKS

Human resource managementAswathappa Human resource managementV. S. Rao Human resource managementGary desslerPersonnel management - C.B.mamoriaEvaluating management training and development - B.R.virmani premila sethStrategic human resource managementSrinivas.R.Kandula

. Performance Management, Concepts, Practices and Strategies for Organisation successby S. K. Bhatia, Deep & Deep Publications Pvt. Ltd, 2008.. Human Resource Management. By S. Seetharaman & B. Venkateswara Prasad, ScitechPublication, 2007.. Kothari, C.R., Research Methodology - Methods & Techniques , New Delhi, NewAge international (P) Ltd., Publishers, Second Edition,2004.. Statistical Methods for Management, By P.N. Arora & S.Arora New Delhi, SultanChand & Sons Publishers, 2005.Internetwww.performance-appraisal.comwww.hrwale.com/performance./performance-appraisal-methodshttp://www.whatishumanresource.com/traditional-methods-of-performance-appraisal http://www.openlearningworld.com/books/Performancehttp://www.citehr.com/206533-performance-appraisal-methods-organizational-goals.htmlhttp://en.wikipedia.org/wiki/Performance_appraisal47 | Page