Internal Evaluation Number 3

                      HIMANSHU AHIRE 13

     E x e c u t i v e F u l l Time PGDM  ( 2009-2010 )
                               Trimester 2
  S y m b i o s i s I n s t i tu t e o f Man ag emen t S t u d i es
Question 1: Describe HRM as a process and explain its relevance in today's era.



A basic concept of management states that manager works in organizations. Organization
has three basic components,

People, Purpose, and Structure.

HRM is the study of activates regarding people working in an organization. It is a mana-
gerial function that tries to match an organization’s needs to the skills and abilities of its
employees. Management.For simplicity, we can say that it is the management of humans
or people. HRM is a managerial function that tries to match an organization’s needs to the
skills and abilities of its employees. Human Resource Management is responsible for how
people are managed in the organizations. It is responsible for bringing people in organiza-
tion helping them perform their work, compensating them for their work and solving
problems that arise.

Functions of HRM

Basic functions that all managers perform: planning, organizing, staffing, leading, and
controlling. HR management involves the policies and practices needed to carry out the
staffing (or people) function of management.

HRM functions can be broadly classified into

•Societal Objectives : Organization becomes socially responsive

•Organizational Objectives : HRM is not standalone department but its means to achieve
organizational objectives.

•Functional Objectives : HRM has only functional value & should not become too ex-
pensive at the cost of the organization it serves

•Personal Objectives : Assist employees to achieve their personal Goals.

Following are some of the important functions of HRM.

• Staffing (HR planning, recruitment and selection)

• Human resource development

                                                                           Himanshu Ahire

• Compensation and benefits

• Safety and health

• Employee and labor relations

• Records maintaining, etc.

• HR research (providing a HR information base, designing and implementing employee
communication system).

• Interrelationship of HR functions.

HRM as Process

HRM is not a one time job. Its an ongoing process. All the functions of HRM needs to car-
ried out thought organization life span. Like any management process HRM start with
planning & forecasting also called as HRP.

Following are list of activities needs to be following in HRM process.

• Human Resource Planning:
HRP is the process of systematically reviewing human resource requirements to ensure
that the required number of employees, with the required skills, is available when they are
needed. After an organization’s strategic plans have been formulated, human resource
planning can be undertaken. Human resource planning has two components: require-
ments and availability. Forecasting human resource requirements involves determining
the number and type of employees needed by skill level and location. In order to forecast
availability, the human resource manager looks to both internal sources (presently em-
ployed employees) and external sources (the labor market).

• Job Analysis & Job Design
Job Analysis is the SYSTEMATIC process of collecting and making judgments about all the
important information related to a job. Job analysis is the procedure through which you
determine the duties and nature of the jobs and the kinds of people who should be hired
for them.

• Recruitment
Recruiting refers to the process of attracting potential job applicants from the available la-
bor force. Every organization must be able to attract a sufficient number of the job candi-
dates who have the abilities and aptitudes needed to help the organization to achieve its
                                                                           Himanshu Ahire

• Selection
Selection is the process of choosing from a group of applicants those individuals best
suited for a particular position.

• Induction & orientation :
Making new hire employes familiar with organization & placing them into right depart-

• Training & Development :
The heart of a continuous effort designed to improve employee competency and organiza-
tional performance. Training typically focuses on providing employees with specific skills
or helping them correct deficiencies in their performance.

• Performance Management:
Performance appraisal is a system of review and evaluation of an individual or team’s job
performance. An effective system assesses accomplishments and evolves plans for devel-

• Career development
Career can be defined as a general course of action a person chooses to pursue throughout
his or her working life. Career planning is an ongoing process through which an individ-
ual sets career goals and identifies the means to achieve them. The process by which indi-
viduals plan their life’s work is referred to as career planning. Through career planning, a
person evaluates his or her own abilities and interests, considers alternative career oppor-
tunities, establishes career goals, and plans practical developmental activities.

• Compensation, Benefits & Safety :
Total compensation constitutes of two types of the rewards which are direct rewards and
indirect rewards. Direct rewards include the salaries wages, commission, bonuses and gain
sharing all of these rewards are directly paid to employees in monetary or financial terms,
second type of the rewards are benefits provided by organization. Benefits are not direct
payments in financial terms.

• Managing separation & rightsizing
Separation occur when the employee leaves organization. It can be voluntary like quits
,Retirements or involuntary like discharge,layoff,retrenchment,VRS & rightsizing.

                                                                              Himanshu Ahire

• Respond to external environment
Organization has two type of environment 1. Internal & 2. External.

Its job of HR department to have peaceful Industrial relation & resolve disputes as soon as
possible. It is also important to manage Trade Unions . So to remain competitive its very
important for HR to be responsive to internal & external environmental changes.

Relevance Today

Today’s organizations are facing challenges upon following levels:

•Environmental Challenges

•Organizational Challenges

•Individual Challenges

Environmental Challenges

Environmental challenges refer to forces external to the firm that are largely beyond man-
agement’s control but influence organizational performance. They include: rapid change,
the internet revolution, workforce diversity, globalization, legislation, evolving work and
family roles, and skill shortages and the rise of the service sector.

Environmental challenges today are:

a) Rapid change, ( Galloping Expansion of Business)

b) Work force diversity & globalization

d) Legislation,

e) Technology

f) Evolving work and family roles,

g) Skill shortages and the rise of the service sector

To manage all above mention changes HR department must be equipped with right tools
& information. HR department can assist business strategy to work by addressing above
mention issues.HR policies can help or hinder a firm grappling with external change

                                                                        Himanshu Ahire

Organizational Challenges

Organizational challenges refer to concerns that are internal to the firm. However, they are
often a byproduct of environmental forces. These issues include: competitive position
(cost, quality, and distinctive capability), decentralization, downsizing, organizational re-
structuring, self-managed work teams, small businesses, organizational culture, technol-
ogy, and outsourcing.

An organization will outperform its competitors if it effectively utilizes its work force's
unique combination of skills and abilities to exploit environmental opportunities and neu-
tralize threats.

HR policies can influence an organization's competitive position by

a) Controlling costs,

b) Improving quality, and

c) Creating distinctive capabilities

ci) Restructuring

Individual Challenges

Human resource issues at the individual level address concerns that are most pertinent to
decisions involving specific employees. These issues almost always reflect what is hap-
pening in the larger organization. How individuals are treated also is likely to have an ef-
fect on organizational issues. For instance, if many key employees leave a firm to join its
competitor, it will affect the competitive posture of the firm. The individual issues include
matching people and organization, ethics and social responsibility, productivity, empow-
erment, brain drain, and job insecurity.

Only managers who are well informed about important HR issues and organizational
challenges can resolve address this issues effectively. Hence we can say that importance of
HRM in todays dynamic changing word is increasing like never before.

                                                                          Himanshu Ahire

Question 2: Define Training, eduction and development. Discuss various meth-
ods and steps in training process in detail.


Training & Development is on going process in any organization. The basic purpose of
training & Development are as follow.

1. Increase Productivity of employees & improve profitability

2. Improves the job knowledge & skills throughout the organization

3. Helps employees identify with organizational goals.

4. Effective decision making & problem solving skills.

5. Helps to create better corporate image.

6.Provides competitive advantage to firm.

7. Increase health & safety of employee by reducing chances of accidents, scarp & dam-

In general sense training,development & education are treated as same but there is differ-
ence between these terms.

Training :

Training refers to process of imparting specific skills. Example :- learn Accounting soft-
ware, operating particular machine, Induction training, soft skills training.

Training programs mostly deals with teaching particular or set of skills to the employees.

Skills can be motor skills, interpersonal skills or people skills as required by particular job.


Education can be define as process of learning theoretical concepts in the class room Ex-
ample: MBA classes

The whole objective of education is to teach theoretical concepts & develop sense of rea-
soning & judgement. Most of the companies today encourage their employees to take part

                                                                                 Himanshu Ahire

time educational courses like MBA. Educations is vary important for managers & execu-
tives than lower cadre workers.


Development refers to the learning opportunities designed to help employees grow.

Development is less skill-oriented but more stressed upon knowledge. Its continues &
long term process. Knowledge can be about Business Environment , Management Princi-
ple & techniques , human relation & specific industry analysis.

Training Vs Education

                  TRAINING                                        E D U C AT I O N

 training deals with application of skills in Education is theoretical in nature
 the job

 Training can be on-job as well as classroom       education is mostly classroom training

 Training has narrow prospective it deals with education is broad prospective deals
 specific skills                                    with general concepts

Training Vs Development

                  TRAINING                                      DEVELOPMENT

 mostly deal with current job                      development is mainly for future job.
                                                   Job employee might fit in future.

 Mostly deals with technical aspect of job         Conceptual in nature

 main objective is to improve skill sets & job Main objective is to prepare employees
 performance                                       for future responsibility

 Its short-term & periodic process                 Its long-term & ongoing process.

                                                                               Himanshu Ahire

Training Process

As discussed earlier training is one of the most important activity, which should be fol-
lowed to remain completive in the market. Knowing this fact most of the organization
spend heavy amount on training & development of employees. Although said that train-
ing is effective only when its sync with organizational objectives. Training to be effective
should follow certain process. Following diagram will show overall training process.

                                             Training Process


         Instructional                            Development of
                                                                    Training Validity
           Objective                                 Criteria

                                                                    Transfer Validity
                          Selection & Design of
                         instructional programs

                                                     Use of             Validity
                                Training           evaluation

                                                                           Himanshu Ahire

Following are steps in training process

1. Need Assessment

Need assessment helps to find out present problem & future needs to be met through
training & development. Todays organizations spends lot of resources on training & if
training need is not analyzed properly it could lead to wastage of precious resources &

Training requirement can be due to individual needs or group needs.

         a. Organization Support :

        Need assessment should be supported by organization so that disruption is less

         b. Organizational analysis: Seeks to examine the goals of the organization & trends
         that are likely to affect these goals

         c. Task & KSA analysis: Task analysis is
         important aspect of need assessment. It is
         necessary to assess & identify what are skils
         & abilites (KSA) are necessary to perform
         these tasks.

         d. Personal analysis : Its more focused on
         individual employees. it helps to determine
         which KSA

2. Deriving instructional objectives

Once training needs are assessed, training and development goals must be established.
Without clearly set goals, it is not possible to design a training and development pro-
gramme and, after it has been implemented there will be no way of measuring its effec-
tiveness. Goals must be tangible, verifiable, and measurable. This is easy where skills’
training is involved.


The successful trainee will be expected to calculate sales figure.

                                                                         Himanshu Ahire

Nevertheless, clear behavioral standards of expected results are necessary so that the pro-
gramme can be effectively designed and results can be evaluated.

3.Designing of training & development program

Every Training program should answer following questions

         a. Who participates in the program ?

         b. Who are the trainers ?

         c. What Methods & techniques used for training ?

         d. Level of training

         e. learning principles

         f. location of training

Who are the trainers: Trainers should be selected on the basis of self-nomination, recom-
mendations of supervisors or by the HR department itself. Whatever is the basis, it is ad-
visable to have two or more target audience.

It is also important to outline level of training required. excess or shortage of training pro-
gram will not help to achieve set objectives.

Training & development programs are likely to be effective when they incorporate the
principles of learning like Employee motivation, Reinforcement, goals, meaning of mate-
rial & transfer of learning.

The final step towards designing training program is to decided where training program
should be conducted. 1. At job itself 2. On site but not on the job 3. Off the site.

4.Methods and Techniques of training

Various methods of training is used to train employees. Training methods

are categorized into two groups (i) on the job training and (ii) off-the job methods.

On the job training: refers to methods that are applied in the workplace, while the

employees is actually working.

                                                                             Himanshu Ahire

On-job training


1.Tailor-made course content with use of REAL company situations/examples.

2. It is usually less expensive than off-job training.

3.Learning will take place using the equipment which will be actually used

4.Trainees acclimatize more rapidly


1.Possibility of poor instruction and insufficient time.

2.Trainee may be exposed to bad work practices.

3.A large amount of spoiled work and scrap material may be

4.produced ,Valuable equipment may be damaged.

5.Training takes place under production conditions that are stressful, i.e. noisy, busy, con-
fusing and exposing the trainee to comments by other workers.

Types of on-Job training

1.Orientation training

2. Job-instruction training

3.Apprentice training

4.Internships and assistantships

5.Job rotation


                                                                          Himanshu Ahire

Off-job training


1. A specialist instructor enables delivery of high quality training.

2. Wider range of facilities and equipment are available.

3. The trainee can learn the job in planned stages.

4. It is free from the pressures and distractions of company life.

5. It is easier to calculate the cost of off-job training because it is more self-contained

6. Cross-fertilisation of ideas between different companies.


1. Can result in transfer of learning difficulties when a trainee

2. changes from training equipment to production equipment.

3. No training can be entirely off-job as some aspects of the task can only be learned by do-
ing them in the normal production setting, with its own customs and network of personal

3.Can be more expensive.

4.Carrying out the training

Type of Off-the –job training:

1.• Vestibule

2.• Lecture

3.• Special study

4.• Films

5.• Television

6.• Conference or discussion

7.• Case study

                                                                               Himanshu Ahire

8.• Role playing

9.• Simulation

10.• Programmed instruction

11.• Laboratory training

Vestibule Training: This training method attempt to duplicate on-the-job- situation in a
company classroom. It is a classroom training that is often imported with the help of the
equipment and machines, which are identical with those in use in the place of work. This
technique enables the trainees to concentrate on learning new skill rather than on perform-
ing on actual

job. This type of training is efficient to train semi-skilled personnel, particularly when
many employees have to be trained for the same kind of work at the same time. Often
used to train – bank tellers, inspectors, machine operators, typists etc. In this, training is
generally given in the form of lectures, conferences, case studies, role-play etc.

Lectures: Lecture is a verbal presentation of information by an instructor to a large audi-
ence. The lecture is presumed to possess a considerable depth of knowledge of the subject
at hand. A virtue of this method is that is can be used for very large groups, and hence the
cost per trainee is low.

This method is mainly used in colleges and universities, though its application is restricted
in training factory employees. Limitations of the lecture method account for its low popu-
larity. The method violates the principle of learning by practice. It constitutes a one-way
communication. There is no feedback from the audience. Continued lecturing method can
be made effective it if is combined with other methods of training.

Audio-visuals: Audio-visuals include television slides, overheads, video- types and films.
These can be used to provide a wide range of realistic examples of job conditions and
situations in the condensed period of time. Further, the quality of the presentation can be
controlled and will remain equal for all training groups. But, audio-visuals constitute a
one-way system of communication with no scope for the audience to raise doubts for
clarification. Further, there is no flexibility of presentation from audience to audience.

                                                                               Himanshu Ahire

5. Programmed Instruction (PI): This is method where training is offer without the inter-
vention of a trainer. Information is provided to the trainee in blocks, either in a book form
of through a teaching machine.

PI involves:

1. Presenting questions, facts, or problems to the learner

2. Allowing the person to respond

3. Providing feedback on the accuracy of his or her answers

4. If the answers are correct, the learner proceeds to the next block. If not, he or she repeats
the same.

6. Computer-Assisted Instruction (CAI): this is an extension of the PI method. CAI pro-
vides for accountability as tests are taken on the computer so that the management can
monitor each trainee’s progress and needs. CAI training program can also be modified
easily to reflect technological innovations in the equipment for which the employee is be-
ing trained. This training also tends to be more flexible in that trainees can usually use the
computer almost any time they want, thus get training when they prefer.

7. Apprenticeship: This method of training is usually done in crafts, trades and in techni-
cal areas. It is the oldest and most commonly used method, if the training is relatively for
a longer period. Here a major part of training is spent on the job productive work. Each
apprentice is given a programme of assignments according to a pre-determined schedule,
which provide for efficient training in trade skills.

8. Simulation: A simulator is any kind of equipment or technique that duplicates as nearly
as possible the actual conditions encountered on the job. Simulation then, is an attempt to
create a realistic decision-making environment for the trainee. Simulations present likely
problem situations and decision alternatives to the trainee. The more widely held simula-
tion exercises are case study, role-playing and vestibule training.

9. Conference: In this method, the participating individuals confer to discuss points of
   common interest to each other. It is a basic to most participative group centered meth-
   ods of developments. This emphasis on small group discussion, on organized subject
   matter and on the active participation of the members involved.
                                                                            Himanshu Ahire

There are three types of conferences,

* Direct discussion: - Here trainer guides the discussion in such a way

that the facts, principles or concepts are explained.

* Training Conference: - The instructor gets the group to pool its

knowledge and past experience and brings different points of view to bear

on the problem.

* Seminar Conference: - In this method instructor defines the problem,

encourages and ensures the full participation in the discussion.

10. Case Studies: This method is developed in 1800S At the Harvard Law School. The
case study is based upon the belief that managerial competence can best be attained
through the study, contemplation and discussion of concrete cases. When the trainees are
given cases to analyse, they are asked to identify the problem and recommend tentative
solution for it. The case study is primarily useful as a training technique for supervisors
and is specially valuable as a technique of developing

discussion-making skills, and for broadening the prospective of the trainee. In case study
method the trainee is expected to master the facts, should acquainted with the content of
the case, define the objective sought in dealing with the issues in the case, identify the
problem, develop alternative courses of action, define the controls needed to make the ac-
tion effective and role play the action to test its effectiveness and find conditions that may
limit it.

11. Role Playing :In role-playing trainees act out the given role as they would be in stage
play. Two or more trainees are assigned parts to play before the nest of the class. Here
role players are informed of a situation and of the respective roles they have to pay. Some-
times after the preliminary

planning, the situation is acted out by the role players. This method primarily involves
employee-employer relationship – Hiring, firing, discussing a grievance procedure, con-
ducting a post appraisal interview etc.

                                                                          Himanshu Ahire

12. Programmed Instructions: This method involves a sequence of steps that are often set
up through the central panel of an electronic computer as guides in the performance of de-
sired operation or series of operations. This method involves breaking information down
into meaningful units

and then arranging these in a proper way to form a logical and sequential learning. The
programme involves – presenting questions, facts or problems to trainees to utilize the in-
formation given and the trainee instantly receive feedback on the basis of the accuracy of
his answers.

To be really effective, the training methods must fit in training programme needs to find
out how effective the methods are in accomplishing their goals of modifying skills, atti-
tudes and ultimate behaviour.

12. Implementation of training program

Once the training program has been designed, its needs to be implemented.

The program implementation requires action on the

following lines

1. Deciding location & organizing training & other


2. Scheduling the training program

3. Conducting training program

4. Monitoring the progress of trainees.

13.Evaluation of the program

The last step in the training & development process is the evaluation of results.

Following are benefits of Evaluation
                                                                          Himanshu Ahire

1.To monitor the quality of training.

2.Provide feedback.

3.To appraise the overall effectiveness of the investment in training

4.To assist the development of new methods of training

5.To aid the individual evaluate his or her own learning experience.

Methods of Evaluation

Various methods can be used to collect data on the outcomes of training. Some of these

Questionnaires: Comprehensive questionnaires could be used to obtain opinion reactions,
views of trainees.

Tests: Standard tests could be used to find out whether trainees have learnt anything dur-
ing and after the training.

 Interviews: Interviews could be conducted to find the usefulness of training offered to

Studies: Comprehensive studies could be carried out eliciting the opinions and judgments
of trainers, superiors and peer groups about the training.

Human resource factors: Training can also be evaluated on the basis of employee satisfac-
tion, which in turn can be examined on the basis of decrease in employee turnover, absen-
teeism, accidents, grievances, discharges, dismissals, etc.

Cost benefit analysis: The costs of training (cost of hiring trainers, tools to learn training
centre, wastage, production stoppage, opportunity cost of trainers and trainees) could be
compared with its value (in terms of reduced learning time improved learning, superior
performance) in order to evaluate a training programme.

Feedback: After the evaluation, the situation should be examined to identify the probable
causes for gaps in performance. The training evaluation information. (about costs, time
spent, outcomes, etc.) should be provided to the instructors’ trainees and other parties
concerned for control, correction and improvement of trainees' activities. The training
evaluator should follow it up sincerely so as to ensure effective implementation of the
feedback report at every stage.

                                                                          Himanshu Ahire

Question 3: What is performance Appraisal? Discuss various methods of per-
formance appraisal.


Today’s working culture demands a great deal of commitment and effort from the em-
ployees, who in turn naturally expect a great deal more from their employers. The devel-
opment of much more participative style of management in many organizations is a posi-
tive step towards meeting such heightened expectations. This participative style can be
expressed in a variety of practical ways. For eg: work teams, quality circles, and of course
regular performance appraisals.

Appraising the performance of individuals and groups and organizations has been a
common practice in all societies. While in some instances, these appraisal processes are
structured and formally sanctioned, in other instances they are informal and integral part
of daily activities. Performance appraisal is the method of evaluating the behavior of an
employee at the work place, normally including both quantitative and qualitative aspects
of job performance. Performance here refers to the level of accomplishments. In the sense
that there are expectations from every person in an organization, a certain level of output
or performance is expected from all. How an employee actually performs in the light of
the expectations determines whether his performance is exceptional, good, average or be-
low that. It is always measured in term of results. This process has very a high implication
on various other HR functions, like recruitment, training, manpower planning etc.

It is important that the employees are aware of their goals, how to achieve them, how they
are matching up to them, what should be done if they are not. There is not one right way
of doing the performance appraisals. The most appropriate route to be taken will depend
upon the current style and status of the organization. People do have a negative attitude
about the performance appraisals. Many have the complaints such as, “It’s just yearly rol-
licking”, or “It is like school report time” or “Nothing comes out of it anyway.” A signifi-
cant consideration in choosing how to go about introducing or revising a performance ap-
praisal scheme will be an understanding of how such attitudes have been perpetuated and
how they might be overcome. People carry bad experiences with them for a long time, in
this case, perhaps from job to job. Much has to be done at the time of introducing or revis-
ing a performance appraisal scheme to reassure those who will be involved that the inten-
tions behind conducting the performance appraisal are sincere and positive.

                                                                         Himanshu Ahire

Performance appraisal must be seen as an intrinsic part of a manger’s responsibilities, not
an unwelcome an time consuming addition to them. It is about improving performance
and ultimately the effectiveness all apart of the manager’s remit.


In simple terms performance appraisal may be understood as the assessment of an indi-
vidual’s performance in a systematic way, the performance being measured against such
factors as job knowledge, quality, quantity of output, initiative, leadership abilities, super-
vision, dependability, co-operation, judgement, verstality, health, and the like. Assessment
should not be confined to past performance alone. Potentials of the employee for future
performance must also be assessed.

A formal definition of performance appraisal is:

         “It is the systematic evaluation of the individual with respect to his or her perform-
ance on the job and his of her potential for development.”


There are various methods available for measuring quantity & quality of employees job

performance. Broadly these methods can be classified into two groups

1. Past oriented methods

2. Future oriented methods


• Rating scales:

This is the simplest and most popular technique for appraising employee performance.
The typical rating-scale system consists of several numerical scales, each representing a job
– related performance criteria such as dependability, initiative, output, attendance, atti-
tude, co-operation, etc.

                                                                            Himanshu Ahire

                          Excellent       Good             Ac ceptabl e     Fai r         Poor
                                 5               4                 3                2            1
Dependability                    -               -                 -                -            -
Initiative                       -                -                -                -            -
Over all output                  -                -                -                -            -
Attendance                       -                -                -                -            -
Attitude                         -                -                -                -            -
Co-operation                     -                -                -                -            -
                                 -                -                -                -            -
                                 -                -                -                -            -
Quality of work                  -                -                -                -            -
Total                            -                -                -                -            -
Total s core                     -                -                -                -            -

Each scale ranges from excel linked to salary increase, whereby so many points equal a rise
often to poor. The appraiser checks the appropriate performance level on each criterion,
and then computes the employee’s total numerical score. The number of points scored
may be linked to salary increase, whereby so many points equal a rise of percentage.

Instruction : F or the foll owing performances fa ct ors please indicate on the rating
                 Scale your evaluation of the em pl oyee named below.

Employee’s Name:                        Departm ent :

Rater ’s Name:                          Date:

Rating scales offer the advantages of adaptability, relatively easy use and low cost. Nearly
every type of job can be evaluated with the rating scale, the only requirement being that
the job – performance criteria should be changed. This way, a large number of employees
can be evaluated in a short time, and the rater does not need any training to use the scale.
The disadvantages of this method are several. The rater’s biases are likely to influence
evaluation and the baises are pronounced in subjective criteria such as co-operation, atti-
tude and initiative. Moreover, numerical scoring gives an illusion of precision that is really


In this method, a checklist of statements on the traits of the employee and his or her job is
prepared in two columns viz. a ‘Yes’ column and a ‘No’ column. All that the rater (imme-

                                                                                   Himanshu Ahire

diate superior) should do is tick the ‘Yes’ if the answer to the statement is positive and in
the column ‘No’ if the answer is negative. After ticking off against each item, the rater
forwards the list to the HR department where the actual assessment of the employee takes
place and the actual evaluation is done by the HR department. The HR department as-
signs certain points to each ‘Yes’ ticked. Depending on the number of ‘Yes’ the total score
is arrived at. When points are allotted to the checklist it becomes weighted checklist. The
advantages of this method are economy, ease of administration, limited training of rater,
and the standardization. The disadvantages include, susceptibility to rater’s baises, use of
personality criteria instead of performance criteria, misinterpretation of checklist items,
and the use of improper weights by the HR department, it also does not allow the rater to
give up relative ratings.

                                                                   Yes        No
1. Is the employee real ly interested in the j ob?                  -          -
2. Does he/ she pos sess adequate knowledge about the job?          -          -
3. Is his/her attendance sa tisfactory?                             -          -
4. Does he/she maintain the equipment in a good condition?          -          -
5. Does he/she co-operate with co-workers?                          -          -
6. Does he/she obs erve sa fety precautions?                        -          -
7. Does he/she complete what he/she comm enc es?                    -          -
8. Does he/she evade the responsibility?                            -          -

• Forced Choice Method:

In this the rater is given a series of statements about an employee. These statements are
arranged in blocks of two or more, and the rater indicates which statement is most or least
descriptive of the employee. Typical statements are:

Learns fast………………..Works hard.

Work is reliable…………..Performance is a good example for.

Absents often……………..Others usually tardy.

The rater is simply expected to select statements, which are readymade. The advantage of
this method is the absence of personal bias in rating. The disadvantage is that the state-
ments may not be properly framed- they may not be precisely descriptive of the ratee’s

                                                                             Himanshu Ahire

• Forced Distribution Method
One of the errors in rating is leniency-clustering a large number of employees around a
high point on rating scale. The forced distribution method seeks to overcome the problem
by compelling the rater to distribute the ratees on all points on the rating scale. The
method operates under assumption that the employee’s performance level conforms to a
normal statistical distribution. Generally, it
is assumed that employee performance
level conforms to a bell shaped curve.

The major weakness of the forced distribu-
tion method lies in the assumption that
employee performance level always con-
form to a normal (or some other) distribu-
tion. In organizations that have done good
job of selecting and retaining only the
good performers, the use of forced distri-
bution approach would be unrealistic as well as possibly destructive to the employee mo-

• Critical Incidents Method:
The critical incidents method of employee assessment approach focuses on certain critical
behaviors of an employee that make all the difference between effective and non-effective
performance of a job. Such incidents are recorded by the superiors as and when they occur.

One of the advantages of the critical incidents method is that the evaluation is based on
actual job-behavior. Giving job-related feedback to the employee is also easy. However, the
following drawbacks are there:

Negative incidents are generally more noticeable than the positive ones.

The recording of incidents is a chore to the supervisor and may be put off and easily for-

Overly close supervision may result.

                                                                        Himanshu Ahire

• Behaviorally Anchored Scale

In this approach, broad categories of practice are identified, ideally through collaborations
between supervisors and staff. Specific job behaviors are then linked to the categories.
Measures of staff member behavior are rated on a scale in relation to specific behavior
items, such as “understands department functions”. Job dimensions usually yield similar
broad categories, such as planning, setting priorities, and responsiveness to supervision.
Categories such as these may be useful in framing evaluation criteria in this approach to

Another means of approaching behavior- based appraisal is the behavioral frequency
scale. Here, desired behaviors are described and the staff member is evaluated on how of-
ten those behaviors occur.

• Field Review Method
This is an appraisal by someone outside the assessee’s own department, usually by some-
one from the corporate office or the HR department. The outsider reviews employee re-
cords and holds interviews with the ratee and his/ her
superior. The method is used primarily for making
promotional decisions at the managerial level. Field re-
views are also useful when comparable information is
needed from employees in different units or locations.

The disadvantages of this method are:

An outsider is usually not familiar with the conditions
in an employee’s work environment that may affect the
employee’s ability or motivation to perform.

An ‘outsider’ review does not have the opportunity to observe employee behavior of per-
formance over a period of time and in a variety of situation but only in an artificially struc-
tured interview situation which extends over a very short period of time.

                                                                           Himanshu Ahire

• Performance Tests and Observations:
With a limited number of jobs, employee assessment may be based upon a test of knowl-
edge or skills. The test must be reliable and validated to be useful. Even then, performance
tests are apt to measure potential more than actual performance. In order to test to be job
related, observations should be made under circumstances likely to be encountered. Prac-
tically it may suffer from the costs of test development or cost of administration.

• Essay Method:
In the essay method, the rater must describe the employee
within a number of broad categories, such as:

The rater’s overall impression of the employee’s performance.

The promotability of the employee.

The jobs that employee is now able or qualified to perform.

The strengths and weakness of the employee.

The training and assistance required by the employee.

This method is useful in filing the information gaps about the employees that often occur
in the better-structured checklist method. However, the major drawback can be that many
raters do not have good writing skills. They become confused about what to say, how
much they should state and the depth of narration. Another problem with this method is
that the ratees may be rated on the quality of the appraisal that they give. The quality
standard for the appraisal may be influenced by appearance rather than content. Thus, a
‘high quality’ appraisal may provide little useful information about the performance of the

• Cost Accounting Method:
This method evaluates performance from the monetary returns the employee yields to
his/ her organization. A relationship is established between the cost included in keeping
the employee and the benefit the organization derives from him or her. Performance of the
employee is then evaluated based on the established relationship between the cost and the

                                                                           Himanshu Ahire

• Comparative Evaluation Approaches:
There are two methods that are used to compare one worker’s performance to that of his
or her co-worker.

• Ranking Method:
In this, the superior ranks his or her subordinates in the order of their merit, starting from
the best to the worst. All that the HR department knows is that A is better than B. The
‘how’ and ‘why’ are not questioned. No attempt is made to fractionalize what is being ap-
praised into component elements. To avoid the biases, two or more people can do rankings
and then average can be taken. Its advantages include ease of administration and explana-

• Paired-Comparison Method:
Under this method, the appraiser compares each employee with every other employee,
one at a time. For example, there are five employees named A,B,C,D and E. The perform-
ance of A is first compared to B and a decision is made about whose performance is better.
Then A is compared with C,D,E in that order. The same procedure is repeated for other
employees. The number of comparisons may be calculated with the help of a formula:
N(N-1)/2, where N stands for the number of employees to be compared. If there are 10
employees, the number of comparisons will be 10(10-1)/2=45. After the completion of the
comparison, results can be tabulated and rank is created from the number of times each
person is considered to be superior.

• Management By Objectives (MBO):
MBO emphasizes participation by all organization members.

The following core elements in MBO:

•Formation of trusting and open communication throughout the organization

•Mutual problem solving and negotiations in the establishment of objectives

•Creation of win-win relationships

•Organizational rewards and punishments based on job-related performance and

•Minimal uses of political games, forces and fear.

•Development of a positive, proactive, and challenging organizational climate.
                                                                           Himanshu Ahire

Following are the 6 steps in the MBO process:

1.Formulate long range goals and strategic plans

2.Develop overall organizational objectives

3.Established derivative objectives for major operating units

4.Set realistic and challenging objectives and standards of performance for members of the

5.Formulate action plans for achieving the stated objectives

6.Implement the action plans and take corrective action when required to ensure the at-
tainment of objectives.

MBO evaluation report for a call center person:

Objec tives se t                    Pe riod object ives Accompli shm en ts   variance
Number of calls                            100                    104          104
Number of new cus tom ers con-              20                     18           90
Number of deals cracked                     30                     30          100
Customer complaints                         34                     11          66.66
Number of reports in home of-               12                     10           80
Number of s ales correspondence              4                     2            50
cour ses succe ss fully completed
Deals failed                                 2                     0             0

• Psychological Appraisals:
Large organizations employ full-time industrial psychologist. When psychologists are
used for evaluations they assess an individual’s future potential and not past performance.
The appraisal normally consists of in-depth interviews, psychological tests, discussions
with supervisors and a review of other evaluations. The psychologist then writes an
evaluation of the employee’s intellectual, emotional, motivational and other related char-
acteristics that suggest individual potential and may predict future performance. From
these evaluations, placement and development decisions may be made to shape the per-
son’s career.
                                                                        Himanshu Ahire

• Assessment Centers:
An assessment center is a central location where managers may come together to have
their participation in job related exercises evaluated by trained observers. The principle
idea is to evaluate managers over a period of time, say by one to three days, by observing
and evaluating their behavior across a series of selected exercises or work samples. As-
sesses are requested to participate in work groups (without leader), role-playing and other
similar activities, which require the same attributes for successful performance, as in the
actual job. After recording their observation of ratee behaviors, the raters meet to discuss
these observations. The decision regarding the performance of each assessee is based upon
this discussion of observations.

•360 Degree Feedback:

Where multiple raters are involved in evaluating performance, the technique is called 360o
appraisal. The 360o technique is understood as systematic
collection of performance data on an individual or group,
derived from a number of stake holders- stakeholders be-
ing the immediate supervisors, team member, customers,
peers, and self. In fact, anyone who has useful informa-
tion on ‘how an employee does the job’ may be one of the
appraisers. It enables an employee to compare his or her
perceptions about self with the perceptions of others.
However, receiving feedback on performance from mul-
tiple sources can be intimidating. It may also take a long
time on selecting the rater, designing questionnaire, and analyzing the data.

• Performance Interview:
Performance interview is another step in the appraisal process. The raters should discuss
and review the performance with the ratees, so that they will receive the feedback about
where they stand in the eyes of superiors. Feedback is necessary to effect.

                                                                          Himanshu Ahire


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