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TABLE OF CONTENTS
CERTIFICATE
2
This is to certify that the project entitled “A STUDY ON “THE
and guidance.
(Faculty Guide)
3
DECLARATION
will not be submitted to any other university for any other award of
(name)
ACKNOWLEDGEMENT
inculcating in us, a passion for excellence in all our activities including this
capstone project.
4
I am grateful to MR. J. DHARMARAJ, Senior HR. Manager, HCL BPO for
giving me the opportunity to do the project in the esteemed organisation and also
My sincere thanks are due to our principal MR. JEEVAN GOPAL for his
invaluable guidance for improving the focus as well as the content of the project
and our summer internship co-ordinator MR. C.N. PRADEEP for providing the
schedule.
MR. G JAYA KUMAR HR. Executive who has been a constant source of
I would also like to acknowledge with thanks and the support received from other
teaching and support staff, which has been quite helpful for the successful
List of Tables
Table No. Title PageNo.
5
IV 4 Rating of the Performance Appraisal System 52
IV 11 Suggestion 66
6
Respondent and Reporting Authority Agree 59
IV 7
with the Targets Fixed
IV 11 Suggestion 67
7
EXECUTIVE SUMMARY
The study aims to know the effectiveness of the Performance Appraisal system.
It helps in identifying the needs of the employees and it also assists in taking
corrective actions.
The main objective of the study was to study the method of existing performance
improves the morale of the organization. The scope of the study deals with
8
The type of sampling used in this method is disproportionate stratified sampling.
The sources of the data for the study were primary and secondary data. The
questionnaire was prepared and administered to collect the relevant primary data.
The data obtained from these areas state the effectiveness of the performance
appraisal during the study. The study is conducted with questionnaire supplied to
100 employees only, the study was the time bound as the respondents had to be
The study has helped to know the performance of the employees better
and also assisted in identifying the needs of the employees. This helps to improve
9
CHAPTER - I
INTRODUCTION
10
INTRODUCTION
member of official family. During the First World War, at the instance of Walter
Dil Scott, the U.S army adopted “man-to-man” rating system for evaluating
military personnel.
extent for remedial; it is not simply to control. The data generated through system
could be put to several uses, such as, either to the identification of potentials, as to
form the basis of rewards to high performance and remedial actions for low
organization, trust between supervisors and subordinates and above all a certain
11
I.1.2 DEFINITION
the job for which he is employed, for the purpose of administration including
actions which require different treatment among the members of the group as,
supervisors and others familiar with their performance because employers are
method of evaluating the present and potential usefulness of the employees to the
Dale Yoder:
members.
12
I.1.3FUNCTIONS:
performance.
3) It aims at providing data to managers with which they may judge future
13
I.1.4 Performance Appraisal
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.
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.
14
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.
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.
15
(annual or semi-annual), in which the work performance of the subordinate is
examined and discussed, with a view to identifying weaknesses and strengths as
well as opportunities for improvement and skills development.
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.)
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).
16
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 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.
17
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.
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.
18
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
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.
19
I.2 STATEMENT OF PROBLEM
HCL BPO is a leading third party BPO and is ranked third in India .
Performance Appraisal is an index of productivity. Performance appraisal
facilitates to motivate employees, learning of skills, employee contribution to the
overall effectiveness of the organization, continuous development of the
employee, prepares employees to anticipate problems and help in planning
strategies, facilitates constructive suggestions, facilitates information gathering
and enhances the relationship with superiors.
This study was needed to know the performance and perception of the
employees. It helps to identity the needs of the employees and it also assists in
taking corrective action when necessary and in setting future goals. This study
also lays emphasis in providing ideas, in order to improve the quality of the
system.
20
I.4 SCOPE OF THE STUDY
21
I.5 RESEARCH METHODOLOGY
The research design is the blue print for fulfilling objectives and
answering questions of specific research problem. A research design is purely and
simply the framework a plan for a study that guides the collection and analysis of
the data.
The research designs used in this project are :
with different age, sex etc., to determine whether certain variables are associated
1. Primary data
2. Secondary data
The data collected for this research is through primary data collection method.
22
The main sources through which data is collected are
1. Primary data
2. Secondary data
Primary Data
Secondary Data:
23
I.5.B SAMPLING METHODOLOGY
Type of Sampling
sampling technique is, those, which do not provide every item in the universe
Sampling Area:
Pilot Study:
Pilot study was conducted to find out the feasibility of the questionnaire.
Based on the necessity of information the questionnaire was prepared and
questionnaire was given to the set of cadres. Based on the response the
questionnaire was modified and finalized for the survey
24
I.6 PERIOD OF THE STUDY
The survey was conducted from April – July . The data obtained from
these areas state the employee’s perception on performance appraisal during the
study period. The study may vary from time to time.
25
CHAPTER SCHEME
II INDUSTRY PROFILE
CONCLUSION
26
CHAPTER – II
INDUSTRY PROFILE
27
28
29
30
31
32
INDUSTRY PROFILE
II. 1 .1 Definition
33
BPO has evolved over the years, beginning with time-sharing data processing in
the 1960s; according to technology research and consulting firm ebs. Over these
years, like outsourcing, BPO has moved from being transactional (task oriented)
to being strategic (process oriented). Table 1 provides the key milestones in the
evolution of BPO.
Administrative support:
Document processes
34
Finance and accounting
Human resources (HR) is one of the most critical assets of a company and
companies need to carry out various tasks such as recruitment, training,
attrition/retention, database management, contract-worker management, etc., for
their employees. Carrying out these tasks through an internal HR department is
costly and diverts the attention of the management from its core business issues.
Hence, companies are now resorting to HR outsourcing big time.
Legal services
35
Medical transcription
This segment includes payroll, payment, check, credit card and stock trade
processing. Forester research predicts transaction processing to be a large segment
within the BPO industry soon, with a market size of USD 58 billion in 2008.
Some vertical processes such as mortgage, loans and insurance claims processing
are also being outsourced.
Product development
Publishing
36
Research and analysis
Companies require data and its analysis for making informed strategic
decisions. These companies have started outsourcing their research and analysis
requirements to vendors who specialize in typical research and analysis work such
data analytics, financial analytics, market research, secondary research, primary
research, industry overview, competitive intelligence, etc.
Security
37
II. 1.3 Different Types of Services Being Offered by BPO's
3. Telemarketing Services
38
5. Insurance Processing
39
II. 2 BPO IN 2010
India’s software services and BPO exports are projected to touch $60
billion by 2010 on the back of over 25 per cent year-on-year growth, though the
country would have to address critical issues such as a potential shortage of 0.5
million qualified workforce and ramp up the existing infrastructure to sustain its
India has the potential to capture over 50 per cent of the $110-billion pie
40
The report said that offshore and BPO industry can power India's
economic growth, accounting for seven per cent of the GDP, and about 44 per
It would also create 2.3 million direct jobs and over 6.5 million indirect
jobs in the same period. The projection, however, does not take into account the
McKinsey & Company, said a mere 10 per cent of the $300-billion global
addressable market had been tapped so far, thus, putting the current offshore
forward, the more traditional IT outsourcing service lines such as hardware and
account for 45 per cent of the total addressable market for offshoring and will
He said that the addressable market for BPO industry could grow over 10
industries such as retail and banking and cross industry functions such as HR and
41
With 28 per cent of the IT and BPO talent amongst 28 low-cost countries,
India now accounts for 65 per cent of the global industry in offshore IT, and 46
per cent of the global BPO industry. In absolute numbers, the IT services exports
are pegged at $12 billion, while the BPO exports stand at $5.2 billion.
market share over competing locations would depend on addressing critical issues
workforce by 2010, the report indicates a shortfall of nearly 0.5 million qualified
"At present, only 25 per cent technical graduates and 10-15 per cent of the
general college graduates are suitable for employment in offshore IT and BPO
industry. India lacks workers who are fluent in French, German, Japanese and
Spanish, making China and Eastern Europe more attractive offshore destinations
42
The gap can be bridged by setting up focused education zones to improve
Mr Kaka said that rising wages were not a `matter of concern' as India was
still the lowest cost source for suitable talent, ahead of rivals such as China.
"Moreover, every country wanting to capture the market will see similar
On infrastructure, the report said that between now and 2010, IT and BPO
near five Tier-1 cities and about 600,000 workers across other towns. "Thus, the
IT and BPO sector needs at least five new `Gurgaon-plus' and 5-7 new `Pune-plus'
Maran, said that HR would become key to sustaining the industry's growth.
track to achieve the targets set out by the preceding reports of 1999 and 2002 —
43
"We have built this report from the scratch on landscape for the industry,"
44
CHAPTER – III
COMPANY PROFILE
45
III .1 COMPANY PROFILE
HCL has always had the uncanny ability to read ahead, of any market
inflexion point and adapt itself to derive maximum advantage. In all such
transitions (or 'genesis points') in the company's 30-year-history, it has repeatedly
leveraged its fundamental strengths in imagining a future, taking calculated risks
to make the future a reality and being at the leading edge of technology, on its
own or jointly with customer/partners.
46
of desktop and server centric computing, and a multi tier, distributed processing
paradigm for the web.
Source : http://www.hcl.in/30/discovernext.asp
47
It is HCL that pioneered the sub-Rs 10,000 PC and has taken connectivity
to the remotest parts of India by setting up the country’s largest V-Sat network. It
is the only Indian IT company to have as large a domestic presence as its
international presence. India’s banking network has virtually been set up by HCL.
HCL has built networks for over 40,000 bank branches and 6,000 ATMs across
the country. The financial markets, too, are powered by HCL’s IT infrastructure.
Traders in any part of the country enjoy real time connectivity to the country’s
leading stock exchange. HCL is also developing a comprehensive solution to help
the market regulator monitor the market.
Source : http://www.hcl.in/30/discovernext.asp
48
III .3 HCL BPO - The Right Stuff
49
III.5 Top Ten Client Profiles of HCL
50
III. 7 Awards & Certifications
India Operations
ISO 9001:2000
Source : http://www.hclbpo.com/services/services.htm
51
CHAPTER – IV
ANALYSIS AND INTERPRETATION
52
ANALYSIS AND INTERPRETATION
Table : IV. 1
Classification On The Basis Of Age
Inference :
From the above table it is clear that 18% of the respondents are below 25
years of age and 43% of respondents are between 27 –35 years of age and 20% of
46 to – 50 years of age and 11% of respondents are more than 51 years and above.
53
FIG IV.1 CLASSIFICATION ON THE BASIS OF AGE
45
40
35
30
PERCENTAGE
25 <25
26-35
20 36-45
46-50
15 >51
10
0
No of Respondents
54
TABLE :IV. 2
Inference :
From the above table it is clear that most of the respondents are Graduate
and where as some of them are post graduates and few of them are Diploma
holder.
55
FIG IV.2 CLASSIFICATION ON THE BASIS OF AGE
50
45
40
35
30
PERCENTAGE
25 Graduate
Post Graduate
Diplom a
20 Others
15
10
0
No of
Respondents
56
TABLE : IV. 3
Inference :
From the above table it is clear that 60% of the respondents awareness are
57
TABLE : IV. 4
Inference :
From the above table it is clear that 58% of the respondents rating on the
58
FIG.IV 4 RATING OF THE PERFORMANCE APPRAISAL SYSTEM
6%
23%
13%
58%
59
TABLE :IV. 5
Inference :
From the above table it is clear that 58% of the respondents agree that
Performance Appraisal System helps to develop a better understanding between
the superior and subordinate to perform better and whereas 30% of them strongly
agree.
60
FIG. IV. 5 UNDERSTANDING BETWEEN THE SUPERIOR AND SUBORDINATE TO PERFORM
BETTER
60 58
50
40
PERCENTAGE
30
30
20
10
10
2
0
0
STRONGLY AGREE NEUTRAL DISAGREE STRONGLY DISAGREE
AGREE
OPINION
61
TABLE : IV. 6
Inference :
From the above table it is clear that 60% of the respondents do not
participate in the Performance Appraisal Meeting and 40% participate in the
Performance Appraisal Meeting.
62
FIG.IV. 6 PARTICIPATION IN PERFORMANCE APPRAISALS MEETING
40%
60%
YES NO
63
Table : IV. 7
Inference :
From the above table it is clear that 90% of the respondents agree with the
targets fixed and few of them do not.
64
FIG IV. 7 RESPONDENT AND REPORTING AUTHORITY AGREE WITH THE TARGETS
FIXED
NO 10
N
O
I
IN
P
O
YES 90
0 10 20 30 40 50 60 70 80 90 100
PERCENTAGE
65
TABLE : IV. 8 EFFECTS OF THE TARGETS GIVEN
Inference :
From the above table it is clear that 50% of the respondents feel that the
targets given are challenging and whereas 38% feel the target are attainable and
66
FIG IV.8 EFFECTS OF THE TARGETS GIVEN
0%
12%
38%
50%
67
Table : IV. 9
Inference :
From the above table it is clear that 73% of the respondents are satisfied
with the guidance provided by the superior and whereas 15% feel it to be neutral
and 10% of the respondents are highly satisfied by the guidance provided by the
superior.
68
FIG IV. 9 GUIDANCE PROVIDED BY THE SUPERIOR
2% 0%
17% 0%
81%
69
Table : IV.10
Inference :
From the above table it is clear that 50% of the respondents agree to a
great extent with the major improvements and achievements and whereas 35% of
them agree to a limited extent.
70
FIG. IV 10 RESPONDENTS AND THE REPORTING AUTHORITY AGREE WITH THE
MAJOR IMPROVEMENT AND ACHIEVEMENT
50
50
45
40
35
35
30
PERCENTAGE
25
20
15
15
10
5
0
0
TO A GREAT EXTENT COMPLETELY TO A LIMITED NOT AT ALL
EXTENT
OPINION
71
TABLE : IV. 11
Suggestion
Inference :
From the above table it is clear that 98% of the respondents suggestion are
considered.
72
FIG. IV. 11 SUGGESTION
2%
98%
CONSIDERED IGNORED
73
Table : IV.12
Barriers In Performance Appraisals
Inference :
From the above table it is clear that 43% of the respondents feel that the
barriers experienced while undergoing Performance Appraisal is due to
insufficient time and whereas 33% feel due to improper database and 24% feel
due to inattentive appraisers.
74
FIG.IV. 12 BARRIERS IN PERFORMANCE APPRAISALS
45 43
40
33
35
30
E 24
G 25
A
T
N
E
C
R 20
E
P
15
10
0
INATTENTIVE INSUFFICIENT TIME IMPROPER DATA
APPRAISERS BASE
BARRIERS
75
TABLE : IV. 13 BENEFITS OF PERFORMANCE APPRAISAL
Inference :
From the above table it is clear that 53% of the respondents opinion in
using Performance Appraisal is all the above and whereas 35% of the respondents
opinion is career development.
76
FIG IV.13 BENEFITS OF PERFORMANCE APPRAISAL
60
53
50
40
35
PERCENTAGE
30
20
10
10
0
CAREER DEVELOPMENT FIXING OF TARGETS PAY REVISION ALL THE ABOVE
BENEFITS
77
Table : IV.14
INFERENCE :
From the above table it is clear that 73% of the respondents feels that they
are encouraged to a certain extent.
78
FIG IV. 14 FEELINGS OF THE RESPONDENT AT THE END OF THE APPRAISAL
80
73
70
60
50
PERCENTAGE
40
30
20
13 13
10
1
0
DELIGHTED ENCOURAGED TO A DISCOURAGED DON’T KNOW
CERTAIN EXTENT
OPTIONS
79
TABLE : IV. 15 MODIFICATION IN THE PERFORMANCE APPRAISAL
Inference :
From the above table it is clear that 55% of the respondents feels that the
modification is necessary for the method performance appraisal conducted in the
company and whereas 45% of them that the modification is not necessary.
80
FIG IV. 15 MODIFICATION IN THE PERFORMANCE APPRAISAL
45%
55%
YES NO
81
CHAPTER – V
FINDINGS, SUGGESTIONS AND CONCLUSION
82
FINDINGS
group of 25 - 35.
job
graduates
83
• It is inferred that the major barrier experienced by the employees
84
SUGGESTION
• Team leaders may understand the employees competencies, and the tasks
periodically.
have exposure in such a way that all the employees participate in the
employees.
• The sufficient time may be given to the employees to fulfill the procedures
effective.
were contained only to the output of the employees. They may also
etc.,
85
CONCLUSION
- Dulewicz, V.
(1989)
justification. That is, appraisal was used to decide whether or not the salary or
86
APPENDIX
BIBLIOGRAPHY
(ICFAI PUBLICATION)
RESEARCH METHODOLOGY
ORGANISATIONAL BEHAVIOUR
L.M. PRASAD
87
WEBSITES
http://www.performance-appraisal.com/home.htm
www.bpoindia.org/
http://hclbpo.com/
http://www.hcl.in/history.asp
88
Questionnaire
Dear Respondent
This questionnaire is part of an academic study being carried out in partial
fulfillment of the MBA degree in ICFAI, Chennai. Please take few minutes to
complete this survey. Please do not leave any question unanswered. Your views,
in combination with those of others, are extremely important. Your survey
responses will be strictly confidential and data from the survey will be reported
only in the aggregate.
Thank you very much for your time and support.
2. Department …………………………………………………
4. Educational Qualification
ٱ Graduate
ٱ Post Graduate
ٱ Diploma
ٱ Other (specify)
89
8. How would you rate the present performance appraisal system
ٱ Good
ٱ Satisfactory
ٱ Poor
ٱ No idea
ٱ Yes
ٱ No
11. Do you & your reporting authority agree with targets fixed ?
ٱ Yes
ٱ No
ٱ Attainable
ٱ Challenging
ٱ Not realistic
ٱ Others Please specify) ………………
13. Are you satisfied with the guidance provided by your superior ?
90
14. How far you and your reporting authority agree with the major
improvements & achievements made by you ?
ٱ Completely
ٱ to a great extent
ٱ to a limited extent
ٱ Not at all
ٱ Considered
ٱ Ignored
15. Which of the following barriers have you experienced while undergoing
performance Appraisals ?
ٱ Delighted
ٱ Encouraged to a certain extent
ٱ Discouraged
ٱ Don’t know
ٱ Yes
ٱ No
91