A SUMMER TRAINING REPORT ON STUDY OF PERFORMANCE APPRAISAL SYSTEM AT VODAFONE

Summer Training Project Report Submitted Towards The Partial Fulfillment For Award Of The Degree Of Bachelors of Business Administration (2007-2010)

UNDER THE GUIDANCE OF MR. RAJESH KUMAR Manager (Trg.)

Submitted To HOD BBA DEPTT.

Submitted By SHIKHA GUPTA Roll no.: 9071571 BBA 6th Sem

HINDUSTAN ACADEMY OF EDUCATIONAL RESEARCH TRAINING GREATER NOIDA

DECLARATION
This is to certify that present thesis titled Study of Performance Appraisal System at Vodafone is based on original research and has not been submitted in part or whole for any diploma or degree of any university. The works of other authors, wherever they have been made use of in this study, have been duly acknowledged at relevant places.

(SHIKHA GUPTA)

ACKNOWLEDGEMENT
One of the most pleasant aspects of writing an acknowledgement is the opportunity to thank all those who have contributed to it. Unfortunately, the list of expression of gratitude- no matter how extensive is always incomplete and inadequate. This acknowledgement is no exception. First of all, I wish to express my sincere gratitude to Faculty Guide, HAERT, Greataer Noida, for giving me opportunity to do research under her profound guidance. Because of her inspiring guidance, motivation, positive criticism, continuous encouragement and untiring supervision this work could be brought to its present shape.

I would like to thank all of them who in one way or the other have helped me.

SHIKHA GUPTA

PREFACE
This project will accomplish to understand how the people interact with technology savy products and if they are ready for doing all the trading through net. The project also helps in understanding the trend of the scripts of the particular sector in different market condition. To maintain and cope up with the growing competition from the various online trading providers, Vodafone needs to find potential clients, also the new investors and satisfy there needs. The Broad objective of the project is to equipped the trainees with all the quality which is essential to face any circumstances which can arise while providing All these steps help me to understand how to cope up with different types of people and there diversified need and satisfaction level.

CONTENTS

Chapter 1: Introduction Chapter 2: Objective and Methodology of the Study Chapter 3: Organization Profile Chapter 4: Performance Appraisal- Theoretical Review Chapter 5: Performance Appraisal System in Vodafone. Chapter 6: Analysis and Interpretation of Data Chapter 7: Conclusion and Suggestions Annexure

CHAPTER 1 INTRODUCTION

CHAPTER 1 TITLE OF THE PROJECT:

Study of Performance Appraisal System and Its Effectiveness in an Organization

INTRODUCTION The history of performance appraisal is quite brief. Its roots in the early 20th century can be traced to Taylor's pioneering Time and Motion studies. But this is not very helpful, for the same may be said about almost everything in the field of modern human resources management. As a distinct and formal management procedure used in the evaluation of work performance, appraisal really dates from the time of the Second World War -not more than 60 years ago. Yet in a broader sense, the practice of appraisal is a very ancient art. In the scale of things historical, it might well lay claim to being the world's second oldest profession! There is, says Dulewicz (1989), "... a basic human tendency to make judgements about those one is working with, as well as about

oneself." Appraisal, it seems, is both inevitable and universal. In the absence of a carefully structured system of appraisal, people will tend to judge the work performance of others, including subordinates, naturally, informally and arbitrarily. The human inclination to judge can create serious motivational, ethical and legal problems in the workplace. Without a structured appraisal system, there is little chance of ensuring that the judgements made will be lawful, fair, defensible and accurate. Performance appraisal systems began as simple methods of income justification. That is, appraisal was used to decide whether or not the salary or wage of an individual employee was justified. The process was firmly linked to material outcomes. If an employee's performance was found to be less than ideal, a cut in pay would follow. On the other hand, if their performance was better than the supervisor expected, a pay rise was in order. Little consideration, if any, was given to the developmental possibilities of appraisal. If was felt that a cut in pay, or a rise, should provide the only required impetus for an employee to either improve or continue to perform well. Sometimes this basic system succeeded in getting the results that were intended; but more often than not, it failed.

For example, early motivational researchers were aware that different people with roughly equal work abilities could be paid the same amount of money and yet have quite different levels of motivation and performance. These observations were confirmed in empirical studies. Pay rates were important, yes; but they were not the only element that had an impact on employee performance. It was found that other issues, such as morale and self-esteem, could also have a major influence. As a result, the traditional emphasis on reward outcomes was progressively rejected. In the 1950s in the United States, the potential usefulness of appraisal as tool for motivation and development was gradually recognized. The general model of performance appraisal, as it is known today, began from that time.

Modern Appraisal Performance appraisal may be defined as a structured formal interaction between a subordinate and supervisor, that usually takes the form of a periodic interview (annual or 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. In many organizations -but not all -appraisal results are used, either directly or indirectly, to help determine reward outcomes. That is, the appraisal results are used to identify the better performing employees who should get the majority of available merit pay increases, bonuses and promotions. By the same token, appraisal results are used to identify the poorer performers who may require some form of counseling, or in extreme cases, demotion, dismissal or decreases in pay. (Organizations need to be aware of laws in their country that might restrict their capacity to dismiss employees or decrease pay.) Whether this is an appropriate use of performance appraisal -the assignment and justification of rewards and penalties -is a very uncertain and contentious matter.

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Controversy, Controversy Few issues in management stir up more controversy than

performance appraisal. There are many reputable sources -researchers, management commentators, psychometricians -who have expressed doubts about the validity and reliability of the performance appraisal process. Some have even suggested that the process is so inherently flawed that it may be impossible to perfect it (see Derven, 1990, for example). At the other extreme, there are many strong advocates of performance appraisal. Some view it as potentially "... the most crucial aspect of organizational life" (Lawrie, 1990). Between these two extremes lie various schools of belief. While all endorse the use of performance appraisal, there are many different opinions on how and when to apply it, There are those, for instance, who believe that performance appraisal has many important employee development uses, but scorn any attempt to link the process to reward outcomes -such as pay rises and promotions. This group believes that the linkage to reward outcomes reduces or eliminates the developmental value of appraisals. Rather than an opportunity for constructive review and encouragement, the reward- linked process is perceived as

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judgmental, punitive and harrowing. For example, how many people would gladly admit their work problems if, at the same time, they knew that their next pay rise or a much-wanted promotion was riding on an appraisal result? Very likely, in that situation, many people would deny or downplay their weaknesses.

Nor is the desire to distort or deny the truth confined to the person being appraised. Many appraisers feel uncomfortable with the combined role of judge and executioner. Such reluctance is not difficult to understand. Appraisers often know their appraisees well, and are typically in a direct subordinate-supervisor relationship. They work together on a daily basis and may, at times, mix socially. Suggesting that a subordinate needs to brush up on certain work skills is one thing; giving an appraisal result that has the direct effect of negating a promotion is another. The result can be resentment and serious morale damage, leading to workplace disruption, soured relationships and productivity declines. On the other hand, there is a strong rival argument which claims that performance appraisal must unequivocally be linked to reward outcomes. The advocates of this approach say that organizations must have a process by which rewards -which are
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not an unlimited resource -may be openly and fairly distributed to those most deserving on the basis of merit, effort and results. There is a critical need for remunerative justice in organizations. Performance appraisal -whatever its practical flaws -is the only process available to help achieve fair, decent and consistent reward outcomes. It has also been claimed that appraisees themselves are inclined to believe that appraisal results should be linked directly to reward outcomes -and are suspicious and disappointed when told this is not the case. Rather than feeling relieved; appraisees may suspect that they are not being told the whole truth, or that the appraisal process is a sham and waste of time.

The Link to Rewards Recent research (Bannister & Balkin, 1990) has reported that appraisees seem to have greater acceptance of the appraisal process, and feel more satisfied with it, when the process is directly linked to rewards. Such findings are a serious challenge to those who feel that appraisal results and reward outcomes must be strictly isolated from each other. There is also a group who argues that the evaluation of employees for reward purposes, and frank communication with them about their performance, are part

13

of the basic responsibilities of management. The practice of not discussing reward issues while appraising performance is, say critics, based on inconsistent and muddled ideas of motivation. In many organizations, this inconsistency is aggravated by the practice of having separate wage and salary reviews, in which merit rises and bonuses are decided arbitrarily, and often secretly, by supervisors and managers. There are basically three purposes to which performance appraisal can be put. First, it can be used as a basis for reward allocation. Decision as to who gets salary increase, promotion, and other rewards are determined by their performance evaluation. Second, these appraisals can be used for identifying areas where

development efforts are needed. The performance appraisal is a major tool for identifying deficiencies in individuals. Finally it can be used as a criterion against which selection devices and development management's programs reward are and validated. punishment As a key input into

decision,

performance

appraisals can motivate or de-motivate employees.

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Three different approaches exist for doing appraisals. Employees can be appraised against 1. Absolute

standards 2. Relative

standards 3. Objectives

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PERFORMANCE MANAGEMENT

Since organisations exits to achieve goals, the degree of success that individual employees have in reaching their individual goals is important in determining organisation effectiveness. Performance system is fundamentally, a feed back process, which require sustained commitment. The cost of failure to provide such feedback may result in a loss of key professional employees, the continued poor performance of employees who are not meeting performance standards and a loss of commitment by employees, in sum, the myth that the employee know what. they are doing without adequate feedback from management can be an expensive fantasy.

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THE APPRAISAL PROCESS

1. 2. 3. 4. 5.

Establishing Performance Standard Communicate Performance expectations to employees Measure actual performance Compare actual performance with standards Discussion with the employees and identification development programs to bridge the gap.

6.

Initiate action

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THE PURPOSE OF APPRAISING PERFORMANCE In general the appraisal systems serve a two fold purpose 1. To improve the work performance of employees by helping them realize and use their full potential in carrying out their firms mission. 2. To provide information to employees and managers for use in making , work related decisions. More specifically appraisals serve the following purposes. a) Appraisals provide feedback to employees and help the. "' management identify the areas where development efforts are "' needed to bridge the gaps thereby serving as vehicles for personal " and career development. b) It helps management spot individuals who have specific skills so that their promotions/transfer are in line with organizational requirements. c) Appraisal serve as a key input for administering a formal organisation reward and punishment system. d) The performance system can be used as a criterion against which selection devices and development programs are validated.

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REQUIREMENT OF THE PERFORMANCE MANAGEMENT SYSTEM.

Reliability: The foremost requirement of a sound system is reliability. In this contact it refers to consistency of judgement. For any given employee, appraisals made by raters working independently of one another should agree closely. But raters with different perspective (e.g. supervisors, peers, subordinates) may see the same individuals job performance very differently. To provide reliable data, each rater must have an adequate opportunity to observe what the employee has done and the condition under which he or she has done it. By making appraisal system relevant, sensitive and reliable we assume the resulting judgement are valid as well.

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Acceptability: In practice, acceptability is the most important requirement of all, for it is true that human resources program must have the support of. those who will use them.

Unfortunately, many organisations do not put much effort into garnering the front end support and participation of those who will use the appraisal system. Ultimately it is management's responsibility to define as clearly as possible the type and level of job behaviour desired of employees. It is important to enlist the active support and cooperation of subordinates by making explicit what aspects of job performance they will be evaluated on. Practicality: This implies that appraisal instruments are easy for managers and employees to understand and to use.

For years, personnel specialists have searched for the 'Perfect; appraisal method as if it were some kind of miraculous cure for many pitfalls that plague organisations. Such a method does not exist. In tommorrow's world of work far more emphasis needs to be placed on process issues. Factors such as timing and frequency are no less important. In sum performance appraisal is a dialogue involving people and data. Both technical and human issues are involved. Neither can be overemphasized at the expense of the other.
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WHO SHOULD EVALUATE PERFORMANCE? The most fundamental requirement for any rater is that he or she has an . adequate opportunity to observe the rates job performance over a reasonable period of time. This suggest several possible raters. The immediate supervisor: Generally appraisal is done by this person. He is probably the most familiar with the individual's performance and in most jobs has had the best opportunity to observe actual job performance. Further more, the immediate supervisor is probably best able to relate the individual's performings to department and organisationalobjectives. In some jobs such as outside sales, law enforcement and teaching, the immediate supervisor may observe a subordinate's actual job performance rarely (and indirectly thru written reports). Here judgement of peers play important role. However, there is a danger of potential bias. Subordinates: Appraisal by subordinates can be useful input to the immediate development. Subordinates know first hand the extent to which the supervisor actually delegates, how well he

communicates, the type of leadership he has and the extent to which he or she plans and orgamses.

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Self appraisal: On one hand it improves the rate's motivation and moral, on the other it tends to be more lenient, less variable and biased. The evidence on the accuracy of self assessment is fairly complex. In industry it is seen that feed back/ input is taken from various sources -Peers, subordinates, superiors etc. Some companies have gone step ahead in taking feedback from the customers and integrating it into the performance management process.

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APPROACHES TO PERFORMANCE MANAGEMENT The traditional approach: The one dimensional model

The Job

Define what results have to e achieved

Performance contact

Define a set of key objectives against the accountabilities Accountabilities i.e, output Review performance against the key objectives

In this model job expectations are defined in terms of what results have to be achieved. This model doesn't have a long term focus and can't be used for employee development and career path planning,

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A satisfactory performance implies doing a job effectively and efficiently, disruptions. with a minimum are degree of employee when -created they are

Employees

performing

well

productive. Yet productivity itself implies both concern for effectiveness and efficiency. Effectiveness refers to goal

accomplishment. Efficiency evaluates the ratio of inputs consumed to outputs achieved. The greater the output for a given input, the more efficient the employees. Similarly, if output is a given, consumed to get that output results in greater efficiency. There are basically three purposes to which performance appraisal can be put. First, it can be used as a basis for reward allocations. Decisions as to who gets salary increases, promotions, and other rewards are determined by their performance evaluation. Second, these appraisals can be used for identifying areas where

development efforts are needed. Management needs to spot those individuals who have specific skill or knowledge deficiencies. The performance appraisal is a major tool for identifying these deficiencies. Finally, the performance appraisal can be used as a criterion against which selection devices and development

programs are validated.

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Chapter 2 OBJECTIVE AND METHODOLOGY OF THE STUDY

25

Chapter 2 OBJECTIVE AND METHODOLOGY OF THE STUDY

1. Objective of the study This project aims at studying the system of performance appraisal and its effectiveness in an organisation. Performance appraisal is the most significant and indispensable tool for the management as it provide useful information for decision making in area of promotion and compensation reviews. Thus broad objectives of the study includes: To know the present system of performance appraisal To know the extent of effectiveness of the appraisal system

To identify and know the area for improvement system

2.

Sample of the study

The population covered for the present study consisted of employee belonging to supervisory and the level above. For the purpose of this study, survey covered the employee of

VODAFONE falling under supervisor and the level above.

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The study covered a sample of 100 employee belonging to supervisory level and above.

3.

Methodology of the project

The project work has been carried out in three stages, a structured questionnaire with objective and question was communicated tested and finalise. During the second stage, the questionnaire was administered to the employees at Vodafone. by contacting them. The work relating to data entry compilation, data analysis and report writing constituted the third stage. Interview index was also used at some places to get information on the project subject. The details of the methodology adopted are presented below:

The Questionnaire Keeping in view the objective of the study, questionnaire was designed and tested on few employees. After getting the proper response and sanction from the concerned department the

questionnaire was finalised.

Response to Questionnaire In all 96 questionnaire were given to employees falling in the

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category of supervisors and above. Out of which 48 could be collected back duly completed. The researcher individually

contacted the employees to get response on the questionnaire. Data entry and analysis It has been an uphill task to enter the enormous data received through the questionnaire which consisted nearly 20 questions. Resgonse to the descriptive questions though very few but was valuable for the purpose of study. Hence these were further structured in time with the system adopted for compilation and data analysis. Limitations Many employees gave guarded answers to some crucial questions. Some of them did not fill the questionnaire due to lack of time Response could not be collected from the total sample selected. Some of the questionnaire could not be completed due to reasons other than time factor. The confidentiality of the system created some problem in getting information.

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Chapter 3 ORGANISATION PROFILE

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Chapter 3 ORGANISATION PROFILE

.

Vodafone over the years

As Vodafone was formed in 1984 as a subsidiary of Racal Electronics Plc. Then known Racal Telecom Limited, approximately 20% of the company's capital was offered to the public in October 1988. It was fully demerged from Racal Electronics Plc and became an independent company in September 1991, at which time it changed its name to Vodafone Group Plc. Following its merger with Air Touch Communications, Inc. (Air Touch), we changed our name to Vodafone Air Touch Plc on 29 June 1999 and, following approval by the shareholders in General Meeting, reverted to our former name, Vodafone Group Plc, on 28 July 2000. Key milestones in the development of Vodafone can be found in the following sections, organized by year: 2007 Vodafone agrees to acquire Tele2 Italia SpA and Tele2 Telecommunication Services SLU from Tele2 AB Group. (October) Vodafone announces completion of the acquisition of Hutch Essar from Hutchison Telecommunications International Limited. (May)

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Safaricom, Vodafones partner in Kenya announces the launch of M-PESA, an innovative new mobile payment solution that enables customers to complete simple financial transactions by mobile phone. (February) Vodafone agrees to buy a controlling interest in Hutchison Essar Limited, a leading operator in the fast growing Indian mobile market, (February) Vodafone announces agreements with both Microsoft and Yahoo! to bring seamless Instant Messaging (IM) services to the mobile which can be accessed from both the PC and mobile handsets. (February) Vodafone signs a series of ground-breaking agreements which will lead to the mobilizing of the internet. You Tube agrees to offer Vodafone customers specially rendered You Tube pages on their mobile phones. With Google, Vodafone announces its intention to develop a location-based version of Google Maps for. With eBay, Vodafone announces it is to offer the new eBay mobile service to customers, With MySpace.com Vodafone announces an exclusive partnership to offer Vodafone customers a My Space experience via their mobile phones. (February). Vodafone reaches 200 million customers (January) 2006 Sale of 25% stake in Switzerland's Swiss COM (December) Sale of 25% stake in Belgium's Proximus. (August) The number of Vodafone lives! Customers with 3G reached 10 million in March 2006. We acquired Telsim Mobil Telekomunikasyon Hostetler (Turkey) in May 2006. Launch of mobile TV capability and Vodafone Radio DJ, which offers a personalized, interactive radio service streamed to 3G phones and PCs. 3G broadband through HSDPA launched offering faster than 3G speeds. Japan business sold to Softbank.

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Make the most of now global marketing campaign launched. Sir John Bond succeeds Lord MacLaurin as Chairman. 2005 We completed the acquisition of MobiFon S.A. (Romania) and Oscar Mobile a.c. (Czech Republic) (May). Launch of Vodafone Simply, a new easy-to-use service for customers who want to use voice and text services with minimum complexity (May). Introduction of Vodafone Passport, a voice roaming price plan that provides customers with greater price clarity when using mobile voice services abroad (May). 2004 We launched our first 3G service in Europe with Vodafone Mobile Connect 3G/GPRS data card. We have 14 Partner Networks with new agreements in Cyprus, Hong Kong and Luxembourg. Vodafone live! with 3G launched in 13 markets (November). 2003 At the GSM Association Awards Ceremony in Cannes, France, we won the mobile industry's most prestigious awards in two categories, Best Consumer Wireless Application or Service and Best Television or Broadcast Commercial for its global consumer service, Vodafone live! Our premium handset for Vodafone live!, the Sharp GX10, won the Best Wireless Handset Award for the Sharp Corporation. Vodafone live! attracts 1 million customers in its first six months. Verizon Wireless and Vodafone co-operate on laptop e-mail, internet and corporate applications access for the US and Europe. Arums Sarin succeeds Sir Christopher Gent as Chief Executive.

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2002 We trial our global mobile payment system in the UK, Italy and Germany. The trial enables customers to purchase physical and digital goods using their mobile phone. We launch the first commercial European GPRS roaming service. Customers are able to seamlessly access services such as corporate e-mail, intranet and personalized information on their mobile phones, laptops or PDAs over GPRS. The Vodafone Group Foundation is launched, with plans to contribute 20 million to community programmers, guided by the Group Social Investment Policy. In October, we announce the launch of Vodafone live!, a new consumer proposition, and Mobile Office, a new business proposition. In November, Vodafone Remote Access is launched as part of Mobile Office. The service gives business customers an easy way to connect to their corporate LAN to access e-mail, calendar and other business specific applications whilst on the move. 2001 We acquire Ireland's leading mobile communications company, Eircell. Vodafone and China Mobile (Hong Kong) ltd (CHMK) sign a 'strategic alliance agreement'. The Group completes the acquisition of a 25% stake in Swisscom Mobile. We introduce instant messaging to our networks, a faster and more efficient way to communicate using text messages via SMS or WAP. First global communications campaign launched in August. The campaign features TV, cinema, print, online and outdoor media, each version asking the question, 'How are you?'.

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First Vodafone Partner Agreement with TDC Mobil A/S, Denmark's leading mobile operator. The agreement is the first of its kind in the mobile industry and means Vodafone and TDC Mobil will cooperate in developing, marketing and advertising international roaming products and services to international travellers and corporate customers. We make the word's first 3G roaming call (between Spain and Japan). 2000 On 4 February, terms are agreed with the Supervisory Board of Mannesmann by which Mannesmann would become a part of the Vodafone community. The transaction almost doubles the size of the Vodafone Group. The agreement to acquire Mannesmann AG receives European Commission clearance on 12 April 2000. Verizon Wireless is launched in May, the combination of Vodafone AirTouch's and Bell Atlantic's US cellular, PCS and paging assets. Vodafone Essar is a cellular operator in India that covers16 telecom circles in India .the name of the company ,the marketing brand used is simply Vodafone .its offers both prepaid postpaid GSM cellular phone coverage through out India and is especially strong in the metros. Vodafone Essar provides 2G services based on 900Mhz and 1800Mhz digital GSM technology ,offering voices and data services in 16 of the countries 23 license .the company is often praised for its aware winning advertisement which all follow a clean ,minimalist look .Sep 19 2007;Vodafone the world leading international mobile communication company has fully arrived in India .Vodafone Essar announced today that the Vodafone brand will be launched in India from 21st sep onward .The popular and endearing brand ,Hutch will be transitioned to Vodafone across India .this marked a significant chapter in the evolution of Vodafone as a dynamic and ever growing brand .Vodafone the world leading mobile tel Essar in may 2007 &company was formally renamed Vodafone Essar in July 2007 .Asim Ghosh , Managing Director of Vodafone. Vodafone group s communication company completed the acquisition of Hutch Arun

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Sarin is visiting in India even as the British operator bid for a majority stake in India mobile services operator Hutchison Essar has run into tough competition Vodafone Essar is owned by Vodafone 67%Essar group 33%.on 11feb 2007 Vodafone agreed to acquired the controlling interest of 67% held by CheungKong holding in hutch Essar for US$11.1 billion, piping Reliance communication, Hinduga group and Essar group, which is the owner of the remaining 33%.the whole company was valued at U S D 18.8 billion .the transaction closed on 8 may 2007 In December 2006 Hutch Essar re launched the Hutch brand nation wide ,consolidating its services under a single identity .the companioned into agreement with NTT Do Co Mo to launch i-mode mobile internet service in India during 2007 .the company used to be named Hutchison Essar ,reflecting the of its previous owner ,Hutchison .the brand was marketed as Hutch .after getting the necessary government approvals with regard to the acquisition of a majority by the Vodafone group .The company was rebranded as Vodafone Essar. Vodafone have both Prepaid& Postpaid &have a15.36 million subscribers and 17.04% market. share in India and operator 16 circle

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Chapter 4 PERFORMANCE APPRAISAL

36

Chapter 4 PERFORMANCE APPRAISAL

Since organisation exist to achieve goals, the degree of success that individual employees have in reaching their individuals goals is important in determining organizational effectiveness. The assessment of how successful employees have been at meeting their individual goals, therefore, becomes a critical part of HRM. This leads us to the topic of performance appraisal. PURPOSE There are basically three purposes to which performance

appraisal can be put.

First, it can be used as a basis for reward allocations.

Decisions as to who gets salary jncreases, promotions, and other rewards are determined by their performance evaluation.

Second, these appraisals can be used for identifying areas

where development efforts are needed. Management needs to spot those individuals who have specific skill or knowledge

deficiencies. The performance appraisals is a major tool for identifying these deficiencies.

Finally the performance appraisal can be used as a criterion

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against which selection devices and development programs are validated. It is one thing to say, for example, that our selection process is successful in differentiating satisfactory performers from unsatisfactory performers.

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HE APPRAISAL PROCESS

Established performance standard

Communicate performance expectations to employee

Measure actual performance

Compare actual performance with standards

Discuss the appraisal with the employees.

If necessary, initiate the corrective action

The

appraisal

process

begins

with

the

establishment

of

performance standards. These should have evolved out of job analysis and the job description discussed under human resource planning. These performance standards should also be clear and objective enough to be understood and measured. Too often, these

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standards are articulated in some such phrase as "a full day's work" or "a good job". Communication only takes place when the transference has taken place and has been received and

understood by the subordinate. Therefore feedback is necessary from the subordinate to the manager. Satisfactory feedback censures that the information communicated by the manager has been received and understood in the way it was intended.

The

third

step To

in

the

appraisal what

in

the

measurement performance.

of To

performance.

determine

actual

determine what actual performance is, it is necessary to acquire information about it. We should be concerned with how we measure and what we measure.

What we measure is probably more critical to the evaluation process than how we measure, since the selection of the wrong criteria can result in serious dysfunctional consequences. And what we measure determines, to a great extent, what people in the organization will attempt to excel at.

One of the most challenging tasks facing managers is to present an . accurate appraisal to the subordinate and then have the subordinate accept the appraisal in a constructive manner.

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Appraising performance touches on one of the most emotionally charged activities the assessment of another individual's

contribution and ability. The impression that subordinates receive about their assessment has a strong impact on their self-esteem and, very important, on their subsequent performance.

The final step in the appraisal is the initiation of corrective action when necessary. Corrective action can, be of two types. One is immediate and deals predominantly with symptoms. The other is basic and delves into causes. Immediate corrective action often described as "putting out fires," whereas basic corrective action gets to the source of deviation and seeks to adjust the difference permanently.

Immediate action corrects something right now and gets things back on track.

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Chapter 5 PERFORMANCE APPRAISAL SYSTEM IN VODAFONE

42

Chapter 5 PERFORMANCE APPRAISAL SYSTEM IN VODAFONE

In Vodafone they have the system of performance appraisal of their employees. The main objective of this performance appraisal system is to evaluate the performance, promote their employees and to arrange for their various training programmes if they require for enhancing their skills in their respective areas and in contribution enhancement.. Employees are evaluated by how well they accomplish a specific set of objectives that have been determined to be critical in the successful completion of their job. This approach is frequently referred to as . management by objectives. Management by objectives is a process that converts organization~l objectives into individual objectives. It can be thought of as consisting of four steps: goal setting, action planning, self- control, and periodic reviews. In goal setting, the organization's overall objectives are used as guidelines from which departmental and individual objectives are set. In action planing, the means are determined for achieving the ends established in goal setting. That is, realistic plans are developed to attain the objectives.

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Self-control refers to the systematic monitoring and measuring of performance. Finally, with periodic progress reviews,

corrective action is initiated when behaviour deviates from the standards established in the goal-setting phase. Vodafone uses very constructive its performance Its appraisal evaluation process is while on

evaluating

employees.

based

quantitativewise and objectivewise. Company set goals to its employee by properly reporting with its employees and then evaluating them upto what extent it has been achieved and if there is failure in reaching the target what are the causes or reasons behind it. Every evaluator has his or her own value system which acts as a standard against which appraisals are made. Relative to the true or actual performance an individual exhibits, some evaluator~ mark high and others low. The former is referred to as positive leniency error and the latter as negative leniency error. When evaluators are positively lenient in their appraisal, an individual's performance becomes over- stated; that is, rated higher than it actually should. Similarly, a negative leniency error understates performance, giving the individual a lower appraisal. As such there is no scope of error as far as the Vodafone company is concerned, but sometimes over estimation of target brings about a description in the evaluating criteria. Thus, though
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chances are less, positive leniency errors have been stated to be committed. Outcome of Performance Appraisal As far as Vodafone company is concerned, there are four outcomes possible: a. Outstanding -If the performance evaluated by the

management turns out to be outstanding. If the employee performs in such a way as to collect 3 consecutive

outstanding performance into his/her credit) he / she gets promoted. b. Excellent -If the performance evaluated by the management turns out to be excellent. If the employee performs in such a way as to collect 3 consecutive excellent performance into his/her credit, he/she gets promoted. c. Good -If the performance evaluated by the management turns out to be good. The management sends the employee to the training programme to improve his/.her skill to perform form. d. Below average -If the performance evaluated by the

management turns out to be below average. And, if the employee collects 3 below average to his/her credit, then he/she dismissed

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Duration of Appraisal System The time constraints enables the employee to show or project his/her capabilities in term of performance as per the duration allowed. In Vodafone, the performance appraisal system is carried out annually.

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Feedback The company provides the annual feedback to its employees and thus, in term bring out the highlights of the self assessment programme. This enables the better communicaiton between the management and employees ad thus, helps in promoting the business future. Response There are mixed responses from the feedback by the employees. It has helped some of the employees in motivating themselves while those who felt bad were thoroughly communicated and all the confusion and failure part were discussed with employees.

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Chapter 6 ANALYSIS AND INTERPRETATION OF DATA

48

Chapter 6 ANALYSIS AND INTERPRETATION OF DATA

After collecting the data on "Performance Appraisal System" data was Analyzed and interpreted. The various topics covered for analysis and interpretation of data are: ) 1. Promotions

A promotion may be defined as an upward advancement of an employee in an organisation to another job, which commands better pay/wages, better status / prestige and higher

opportunities / challenges and responsibility, a better working environment, hours of work and facilities etc. Promoters have a salutary effect on the satisfaction of the promoted person's need for esteem, belonging and security. They also afford an opportunity for greater self-actualizing action through more varied and challenging assignments. The promotion policies differ from an organisation to another. The guidelines for departmental promotion in are same for male and female employees. The period of experience required for filling a higher post departmentally varies from 3-5 years. 5 years experience for promotion to managerial staff and 3 years

49

experience for promotion to Junior Management staff is needed. The other area of promotion apart from seniority are merit and fitness. Though these guidelines are not in a written format the supervisor and manager get it at the time of appraisal from the personnel department.

50

As per the guidelines from the personnel department employees are to be promoted accordingly. However there is confusion among the employee as these guidelines are not being explained time to time, many are not aware of the existing promotion policy in the organisation. Respondents were asked whether the promotion is well defined in the organisation. The responses are given below: N=96 Response Yes No Can't say Number 16 52 28 Percentage 16.66 54.16 29.16

From the above table, it can be seen that 30% agree that promotion is well defined in the organisation. However 54% were not able to say it as there is lack of information about the promotion policy. Every employee need to be communicated about the existing promotion policy.
60 50 40 30 20 10 0 Yes No Can't Say 16 28 52

Series1

51

Respondent were also asked to suggest any change in the policy. The responses were as given below: Response Merit not recognized Does not define career plan Not integrated with business Heterogeneity within policy for different position Number 20 26 0 Percentage 20.83 16.66 0 56 58.83

Majority suggested for no change in the policy. It seems they are satisfied with the current policy.

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Aligning goal Respondent were asked about the present system, does it help in aligning individual goal with those of the organisation. The responses were as given below: Response Yes No Can't say No response Number 44 12 36 4 Percentage 45.83 12.5 37.5 4.16

Here the response from the supervisor were 45.83% for the factor that it help in aligning their goal with those of organisation.
45 40 35 30 25 20 15 10 5 0 44 36

12 4 Yes No Can't Say No response

Series1

53

Career Progress Career progress is something which is continuous, with the input from organisation in term of training, feedback and counselling. In today's changing scenario this has to be followed in every organisation so that an individual make progress in the career adding value to himself and the organisation. Respondent were asked about the current system helping in their career progress. Career advancement is the most motivating factor when employee aspire for the advancement of his career and for better

opportunities to use his/her talents. From the organisation's point of view, it is necessary to develop in manager. Some expectations of opportunities for the future in order to keep their motivation high. Career planning means helping the employee plan his career in terms of his capabilities with the context or organisational needs. Individual, after becoming aware of some of his/her capabilities and career and development opportunities chooses to develop himself/herself in a direction that improves his/her chances of being able to handle new responsibilities. It is also the responsibility of the employer to help him/her to identify the career opportunity, make choices and develop his/her career and provide opportunities for career planning and succession planning

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Question asked was as follows: Are the issues like career planning and succession planning a part of companys policy The responses to the above were as given below:

Response Yes No Cant say

Number 16 44 36

Percentage 16.66 45.83 37.5

Here only 46% of the respondent gave response that it does not while 38% gave response that there is no career development plan at all.

50 40 30 20 10 0 Yes 16

44 36 Series1

No

Can't Say

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Feedback

Providing feedback playa constructive role. It helps the employee know his/her weakness and strength. Feedback provides for the area of improvement.

Respondent were asked about the frequency of feedback based on their performance. The responses were as given below:

Response Rarely On a few occasion Sometimes Often Almost always

Number 24 40 24 8 Nil

Percentage 25 41.66 25 8.34 Nil

41 percent responded that feedback is provided though on a few occasion. The frequency has to increase both from the individual and organisation point of view to keep the individual motivated for work in line with the organisational expectation.

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40 35 30 25 20 15 10 5 0 Rarely On a few Som im et es occasion Oft en Alm ost always

Remedial measure Based on the performance the remedial measures are taken to do away with weakness if any and build on the strength and add to the existing capability

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Response on the remedial measure were as given below:

Response Job rotation Sent to training programme Counselled Any other None

Number 44 40 12 Nil Nil

Percentage 45.83 41.66 12.5 Nil Nil

Here the response were both for job rotation and training programme. During the course it was felt that more training input is to be provided to the employee to overcome the weakness and improve upon the existing capability of the employee.

45 40 35 30 25 20 15 10 5 0 J ob rot ion Sent to CounselledAny ot at her t raining program None

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PROMOTION POLICY AND PERFORMANCE APPRAISAL SYSTEM Respondent were asked whether the promotion policy is linked with the performance appraisal system The responses were as given below: Response Yes No Cant say Number 54 28 14 Percentage 56.25 29.15 14.58

Majority response were that promotion policy is linked with the performance appraisal system.

60 50 40 30 20 10 0

54

28 14

Series1

Yes

No

Can't Say

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SWOT ANALYSIS
STRENGTHS Strong customer oriented and high performance. Quality products and services and improved product proposition. Strategy oriented and better geographic balances. Better brand image. WEAKNESS Paper compilation of the financial reports (stock reports). Inventory management, and procurement processes. Lack of feedback.

OPPORTUNITIES Branch expansion for rapid growth Increase focus on value creation Improve shareholders return Broadening of the demographic base Tie up with MNCs Integrated sales and service approach THREATS Competitive products and offers. Strong competition.

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Chapter 7 CONCLUSIONS & SUGGESTIONS

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Chapter 7 CONCLUSIONS & SUGGESTIONS

Conclusion The analysis and interpretation of data on study of performance appraisal and its effectiveness in an organization led to the following conclusions: The promotion rule though defined need to be communicated to every employee before appraisal process is done and also justify the promotion as a result of the appraisal. That the promotion policy followed differs at different position and category. A uniformity has to be there in the implementation of promotion policy at all levels

The process of performance appraisal followed in Vodafone at

the supervisory and above level IS to say not good but of satisfactory level. The employees do not rate it very good The appraisal outcome has to be used frequently for the purpose of reward on performing well together with the feedback on the performance. Also when performance goes down employee has to be given feedback and motivated to do better.

The organization at present doesn't lay career planning and

career succession plans.

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In Vodafone feedback is being provided to the employee

though on a few occasion.

Performance appraisal in Vodafone is done on an annual basis.

More emphasis on training and job rotation as remedial measures.

The

mechanism

of

counseling

pre-performance

and

post

performance is not in practice at the organisation in strict term. During. the course of study suggestion came from the employee side for the need of counselling. Suggestions The study undertaken bring some interesting result. Training the Appraisee: It is proposed that appraiser be trained for clear understanding of the system and its objective and also counselled to be honest, fair, just, unbiased in appraising the appralsee. Factors/traits of evaluation: It is proposed that appraisee evaluated on above factors/traits be given suitable remark or justification for being given different quantitative grade. Greater clarity has to be has to there in terms of job responsibility. This is possible when the appraisal is done on the

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basis of the description. In the organization, performance appraisal is done on an annual basis which should be done Quaterly to make it more effective. Consistency is demanded in the promotional policy. It should not change every year. Monetary difference between two grades should not be large, it should be motivating in nature. Performance appraisal system should be made more transparent and rationale.

Performance feedback: The performance feedback sessions

should be improved which would results in increasing employee motivation to improve performance. The following could be incorporated. Pin point the problem behaviour and make sure the

employee is aware of it Make sure the employee understands the consequences

of the problem behaviour. Get employee's commitment to change and make sure he cares about the change Assistance should be provided to improve poor

performance. Make a realistic plan appropriate to the

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behaviour and set a time frame for improvement. To make sure to review performance time to time

The other change which has to be incorporated at the supervisor and the level above are: These should be listing down of task undertaken

during the last one year and the result achieved. In some areas of performance there should be self

appraisal and more and more counselling so that employee improve upon weak area and understand what is expected of him/her at the organization level. Based on the above an open appraisal system is

suggested.

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In an open appraisal the employee would come together to set the targets, to understand the mutual expectations and support to be provided by the appraiser to the employee for achieving mutually accepted goals/targets. Through this process of setting targets the interpersonal relationship between the appraiser and the employee would improve. The open appraisal system reduces the whims and fancies of the appraiser. It promotes result-orientation as it is based on

performance rather than on personality based appraisal.

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Annexure
a) b) Questionnaire Bibliography

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QUESTIONNAIRE
TO STUDY PERFORMANCE APPRAISAL SYSTEM
Q.1. Is the promotional policy well defined in your organization? a. Yes Q.2. b. No c. can't say

Do you know the objectives of the Performance appraisal system. If yes kindly specify.

Q.3. How

often

the

performance

appraisal

form

is

filled

or

Performance Appraisal is done. a. e. Q.4. fortnightly. b. monthly c. six-monthly. not fixed. d. annually

On what basis is the performance appraisal done. a. merit cum seniority b. seniority cum merit. c. merit

only d. seniority only. e. any other. Pl. specify

Q.5 Who appraises you? a. c. e. Q.6. appraisal committee. self-appraisal any other please specify b. d. your immediate supervisor 360 degree appraisal.

What methods are being used for performance appraisal a. forced choice distribution method. b. essay method

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c. method e. Q.7.

ranking method.

d.

critical

incident

any other, kindly specify

In your opinion does it identify the training needs? a. to a large extent b. to some extent c. cant say d. not at

all Q.8. Is the promotional policy linked with the performance appraisal

system a. yes b. no c. can't say

Q.9. Are the issues like career planning and succession planning a part of company's policy a. yes b. no c. can't say.

Q.I0 Does the system help you in aligning your goals with those of the organization. a. yes b. no c. can't say

Q.11. What role does top management play in the performance appraisal. kindly comment.

Q.12. Are you a part of the appraisal committee a. yes b. no

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Q 13 . Do the employees get the feedback of performance appraisal a. c. d. yes, every time. b. often, but not always.

only when required rarely e. never

Q.14 Does the organization provide counseling after the appraisal. a. always b. often c. rarely d. never. e. can't say.

Q.15. Who does the counseling a. trained professionals b. untrained counselors. c. can't say Q.16. What kind of remedial measures are taken. a. job rotation counseled d. any other, kindly specify Q.17. How do you rate the overall assessment of performance appraisal a. Outstanding e. Poor b. Very good c. Good d. Satisfactory b. sent to training programmes c.

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Q.18. What do you feel are the positives in the performance appraisal system in your organization, Kindly mention Q.19 What do you feel are the shortcomings of the performance appraisal system being followed in your organization, Kindly mention Q.20. For how long have you been working in this organisation Q.21. Suggestion towards improving the performance appraisal system in your organisation

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BIBLOGRAPHY

1)

Flippo EdwinB., Personnel management, Edition sixth, Tata Mc Graw Hills, 1984, p.g. 225-230

2)

Gupta,

C.B.,

Human

Resource

Management,

Edition

Fifth(Reprint),Sultan Chand and Sons, New Delhi 2006, P.G. 5.35.10 3) Rao, P. Subba,Essentials of Human Resource Management and Industrial Relations;Edition Second, Himalaya Publishing House, New Delhi 2005, p.g.206-210

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WEB SITES SURFED

www.google.com www.indiatimes.com www.msn.com

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