CHAPATER – I
STUDY ON PERFORMANCE APPRAISAL
With reference to Visakhapatnam Steel Plant
Table of Content
Chapter – I Introduction
Chapter – II Company Profile
Chapter – III Theoretical Framework
Chapter – IV Analysis
Chapter – V Suggestions, Summary and Conclusions
Bibliography
Annexure
Data provided here is not absolute …its only for reference
CHAPTER-I
RASHTRIYA ISPAT NIGAM LIMITED
VISAKHAPATNAM STEEL PLANT
INTRODUCTION
Appraising the performance of individuals, groups, and organizations is a common practice of all societies. Appraisal of one individual by another individual is a continuous process and it is Natural phenomenon in human beings. This is constantly done, consciously or unconsciously in our day-to-day interaction either in family life or in a social setting or in an organization for that matter. While the individual or a group uses appraisal in its own fashion depending upon the need of the situation, in an organization it becomes necessary to adopt a formal methodology of appraisal system because of the requirement of measuring the performance for considering suitable reward or punishment or for assessing the potential of a person to increase the responsibilities. In short, there is a great requirement for assessing the efficiency to gear up the productivity of the work force.
NEED FOR THE STUDY:
• Provide information about the performance ranks basing on which decisions regarding salary fixation, confirmation promotion, transfers, and demotions are taken.
• Provide feedback information about the level achievement and behavior of sub-ordinates. This information helps to review the performance of rectifying performance deficiencies and to set new standards of work, if necessary.
• Provide information which helps to counsel the sub-ordinates.
• Provide information to diagnose deficiency in employees.
• Provide information for correcting placement.
• To prevent grievances and in disciplinary activities.
OBJECTIVES:
The following are the specific objectives of the present study. To study the performance appraisal system history and their activities in VSP.
• To study and assess the executive performance system and its effectiveness.
• To analyze the drive towards quality that is integrated into executive performance appraisal.
• To assess the training and development needs of employees.
• To identify and suggest measures to improve effectiveness specifically from quality perspective.
• To effect promotion based on competence and performance.
METHODOLOGY:
To get information about satisfaction level of employees from performance appraisal system and its effectiveness a stratified sample survey was conducted. The information required for making comprehensive study on the performance appraisal system for their growth in the job career. To evaluate the performance of employees is followed by two ways of sources. This is primary and secondary sources.
The Primary data, information about VSP and its HRD activities is gathered from direct contacts and personal discussions with all the departmental employees in the organization. Duties and responsibilities of HR personnel of the organization.
The secondary data can be through overall annual reports of performance of employee in the early years. The performance of the employee can be determined through some techniques are used by the organization. The records maintained by HR department served as valuable source of secondary information required. Journals and magazines formed the basis for the information on annual turnover of the steel. It includes data from the in-house journals and journals related to steel industry, magazines and annual reports of the VSP formed the basis for secondary data.
LIMITATIONS
• The time is a major limitation. The whole study was conducted with in a period of 2 months.
• The study does not cover non-executives some executive cadre and chairman and managing director. The study restricted itself only to Junior Officers to General Manger’s level.
• Study is quality perspective has only been qualitative the information gathered in this regard is mostly through personal discussions.
• Only the existing system is studies and no attempt has been made to identify and complete new and dynamic performance system due to this constraints.
BRIEF DESCRIPTION OF THE STUDY:
• Performance appraisal is the systematic description of an employee’s job relevant strengths and weakness.
• The basic purpose is to find out how well the employee is performing the job and establish a plant of improvement.
• Appraisals are arranged periodically according to a definite plan.
• Performance appraisal is not job evaluation. Performance appraisal refers to how well someone is doing the assigned job. Job evaluation determines how much a job is worth to the organization and, therefore, what range of pay should be assigned to the job.
• Performance appraisal is a continuous process in every large scale organization.
PURPOSE OF THE STUDY:
• To create and maintain a satisfactory level of performance.
• To contribute to the employee growth and development through training, self and management development programs.
• To help the superiors to have a proper understanding about their subordinates.
• To guide the job changes with the help of continuous ranking.
• To facilitate fair and equitable compensation based on performance.
• To facilitate for testing and validating selection tests, interview techniques through comparing their scores with performance appraisal ranks.
• To provide information for making decisions regarding lay off, retrenchment etc.
• To ensure organizational effectiveness, through correcting employee for standard and improved performance and suggesting the change in employee behavior.
CONTENT OF PERFORMANCE APPRISAL:
Every organization has to decide upon the contents to be appraised before the program is approved. Generally, content to be appraised may be in the form of contribution to organizational objectives (Measures) like production, cost saving, return on capital etc., other measures are based on:
i. Behavior which measure observable physical actions, movements.
ii. Objectives which measure job related results like amount of deposits mobilized and,
iii. Traits which are measured in terms of personal characteristics observable in employee’s job activities. Content to the apprised may vary with the purpose of appraisal and type and level of employees.
Contents to be appraised for an officer’s job:
1. Regularity of Attendance.
2. Self Expression: written and Oral
3. Ability to Work with others
4. Leader ship Styles and Abilities
5. Initiative
6. Technical Skill
7. Technical Ability/Knowledge
8. Ability to Grasp new things
9. Ability to Reason
10. Originality and Resourcefulness
11. Creative Skills
12. Area of interest
13. Area of Suitability
14. Judgement Skills
15. Integrity
16. Capability for Assuming Responsibility
17. Level of Acceptance by Subordinates
18. Honesty and Sincerity
19. Thoroughness in job and organizational knowledge
20. Knowledge of Systems and Procedure
INTRODUCTION TO STEEL INDUSTRY IN INDIA
STEEL INDUSTRY:
Steel Industry is the back bone of all industrial commercial activities. Realizing these countries planners have been formulating and updating annual plans for production of iron and steel. In this context a number of steel plants were setup. The steel industry plays a vital role in the growth of nation’s economy.
Steel is such a versatile commodity that every object we see in our day to day life has used steel either directly or indirectly in its product. To mention a few it is used for such small items as nails, pins, needles etc ., agriculture implements boilers, ship fabrication, railway minerals, automobile parts, etc., to have machine structure.
The great investment that has gone into the fundamental research in iron and steel technology has helped both directly and indirectly in many modern fields of today’s civilization if steel has not been there .steel is versatile and indispensable item. The versatility steel can be traced mainly of three reasons.
It is only metallic item, which can be continentally and economically produced, in large quantities.
It has got very good strength coupled with density and malleability.
Its properties can be changed over a wide range .It alloys easily with many of the common element.
INDIA’S STEEL SCENARIO
Indian steel industry has always remained isolated and protected by government, where the steel industry was never expected to generate profit from business, but was expected to provide employment to the unemployed .presently India is operating with open –hearth furnaces. The existing equipment, energy and labour in Indian steel industry are much low than developed countries.
Indian steel industry generates a significant amount of waste materials, which can cause environmental problems. These four aspects of “WASTE MANAGMENT” namely –residue reprocess, recycle and recovery do not hold much ground in the Indian steel industry. The Indian companies cannot spend more for pollution control. The energy consumption per tone is 50-100%higher than that of the international norms.
The Indian steel industries have developed a bit in recent years. The production is growing on properly. Many techniques are being implemented in the steel industries. The country’s aim is to sell quality steel. The government is also helping the steel industries in their basis .The apparent consumption of steel is shown below.
The development of steel industry in India should be viewed in conjunction with the type and system of government that had been ruling the country. The production of steel in significant quality started after 1990. The growth of steel industry can be conveniently started by dividing the period into pre and post independent era. In the period of pre independence steel production was 1.5 million tones per year, which was raised to 9.0 million tones of target by the seventies. This is the present of the bold steps taken by the government to develop this sector.
WORLD’S DEMAND FOR STEEL:
The total demand for steel in world is expected to grow at an annual rate of 1.6% between 1935 and 200 A.D. as per the study concerned by China economists. According to their estimation total demand in advanced industrial countries on the whole is expected to grow at 0.6% annual rate following a 2.2% rate between 1974 to 1984. Steel demand is less in developed countries on a whole is expected go grow at a 5.5% annual rate up to 2000 following a 3.1 annual growth rate between 1984-1994. Within the controlling plant economy the Eastern Europe erstwhile USSR region may have 0.3% annual steel demand growth. Steel demand in China, North Korea region would grow at 4.0 annual rates up to the end of this century at a 7.5% per annual growth during 1974-1980.
HIGHLIGHTS OF PRESENT STEEL SCENARIO:
• The world steel shows a low growth demand.
• There is a threat to steel industry from competitive products like plastics, aluminum etc.
• Developed countries slowly reduced the production of steel.
• Developing countries like China are planning to produce steel as much large quantity then of present output of 80 Mtpa.
• India consciously and strategically decides to invest into steel production.
• Preference is given to superior quality products and high value items production.
• Customer oriented approach in view of product oriented approach.
• Emergence of new technology like scraps preheating.
GROWTH OF STEEL INDUSTRY:
The growth in a chronological order is depicted below:
|S.No. |Year |Growth |
|1. |1830 |Osier Marshall heather constructed the first manufacturing plant at port motor in Madras presidency. |
|2. |1874 |James erskin founded the Bengal frame works. |
|3. |1899 |Jamshediji TATA initiated the scheme for an integrated steel plant. |
|4. |1906 |Formation of TISCO |
|5. |1911 |TISCO started production. |
|6. |1918 |TISCO was founded. |
|7. |1940 |Formation of Mysore Iron and Steel initiated at Bhadravati in Karnataka. |
|8. |1951 |First Five Year Plan – The Hindustan Steel Limited (HSL) was born in. |
|9. |1956 |The year 1954 with decision of setting up three steel plants each with 1 million tones in got steel per|
| | |year at Rourkela, Bhilai, and Durgapur. TISCO started its expansion programme. |
|S.No. |Year |Growth |
|10. |1961-66 |Third Five Year Plan – During the plan the three steel plants under HSL, TISCO and TISCO were expanded.|
|11. |1964 |Bokaro Steel Plant came into existence. |
|12. |1966-69 |Recession period. Till the expansion programmes were actively existed during this period. |
|13. |1969-74 |Fourth Five Year Plan – The Salem steel plant started. Licenses were given for setting up of many mini|
| | |steel plans and re-rolling mills government of India. Plants in south are each in Visakhapatnam and |
| | |Karnataka. SAIL was formed during this period on 24th January, 1973. |
|14 |1974-79 |Fifth Year Plan – The idea of setting up fifth integrated steel plant, the first sea-based plant at |
| | |Visakhapatnam took a definite shape. At the end of the Fifth Five Year Plan the total installed |
| | |capacity from six integrated steel plants was up to 10.6 million tons. |
|15. |1979-80 |Annual Plan. The erstwhile Soviet Union agreed to help in setting up the Visakhapatnam Steel Plant. |
|16. |1980-85 |Sixth Five Year Plan – Work on Visakhapatnam Steel Plant started with a big bang and top priority was |
| | |accorded to start the plant. Schemes for modernization of Bhilai Stee lPlant, Rourkela Steel Plant, |
| | |Durgapur Steel Plant and TISCO were initiated. Capacity at the end of sixth five year plan from six |
| | |integrated plants stood 11.50 million tones. |
|17. |1985-91 |Seventh Five Year Plan - Expansion works at Bhilai and Bokaro Steel Plants completed. Progress of |
| | |Visakhapatnam Steel Plant picked up and the nationalized concept has been introduced to commission the |
| | |plant with 3.0 mt liquid steel capacity by 1990. |
|18. |1992-1997 |Eight Five Year Plan – The Visakhaptnam Steel Plant was commissioned in 1992. The cost of plant has |
| | |become around 8755 cores. Visakhapatnam Steel Plant started the production and modernization of other |
| | |steel plants is also duly engaged. |
|19. |1997-2002 |Ninth Five Year Plan – Restructuring of Visakhapatnam Steel Plant and other public sector undertakings.|
STEEL PLANTS WITH FOREIGN COLLOBORATIONS:
|Sl.NO. |Plant |Collaboration Capacity of |Annual Production |
| | |Finished Steel Products | |
|1. |Rourkela Steel Plant |West Germany |7,20,000 tones |
|2. |Bhilai Steel Plant |Erstwhile USSR |7,70,000 tones |
|3. |Durgapur Steel Plant |Britain |8,00,000 tones |
PROBLEMS OF STEEL INDUSTRY:
LACK OF RAW MATERIALS
Non-availability of good quality raw material is another problem faced by iron and steel industry. The modern giant blast furnace needs high grade iron ore and good metallurgical coal.
Further the industry is unable to get good quality coke and manganese is which he principal raw material nest to iron ore are unfortunately most of our resources of manganese ore are of poor quality besides the non availability of good quality raw material, regular supplies of raw materials are very much handicapped due to the absence of good transport facilities. Another problem faced by the steel industry related to the difficulty in getting zinc supplies for the continuous galvanizing line.
TECHNICAL PROBLEMS
Bhilai had to execute orders for shipment of rails to Iran, South Korea and Malaysia. Because of technical limitations, Rourkela plant is unable substitute aluminum of Zinc for the production of galvanized sheet apart from source internal technical problems; our technology in the field of steel production is not a developed one when compared to other advanced countries. For instance, Japan is production quality steel in spite of importing raw material and additional material from other country.
GOVERNMENT CONTROL AND PRICING POLICY
Since 1941, Indian steel and iron industry was almost completely state regulated. Both prices and distribution of steel were under the control of Govt. The Govt. decided to remove statutory control over the price and distribution of all, but a few categories with effect from 1st March 1964 the Govt., supervise tin betel and iron inducted according to the recommendation of Raja committee. But Raj committee in fixing the steel price didn't regulate the price of the raw materials.
CHAPTER-II
RASHTRIYA ISPAT NIGAM LIMITED
VISAKHAPATNAM STEEL PLANT
INTRODUCTION:
Steel occupies the foremost place amongst the materials in use today and pervades all walks of life. All the key discoveries of the human genius, for instance, steam engine, railway, means of communication and connection, auto mobile, aero plane and computers, are in one way or other, fastened together with steel and with its sagacious and multifarious application. Steel is versatile material with multitude of useful properties, making it indispensable for furthering and achieving continual growth of the economy be it construction, manufacturing, infrastructure or consumables. The level of steel consumption has long been regarded as an index of industrialization and economic maturity attained by a country.
BACKGROUND:
To meet the growing domestic needs of steel, Government of India decided to set up an integrated steel plant at Visakhapatnam. An agreement was signed with erstwhile USSR in 1979 for cooperation in setting up 3.4. Mtpa integrated Steel Plant at Visakhapatnam. The foundation stone for the plant was laid by the then Prime Minister on 20th January 1971.
The project was estimated at cost of Rs.3897.28 corers based on prices as on 4th quarter of 1981. However, on completion of construction and commissioning of the whole plant in 1992, the cost escalated to around 8500 cr. Unlike other integrated Steel Plants in India, Visakhapatnam Steel Plant is one of the most modern steel plants in the country. The plant was dedicated to the nation on 1st August, 1992 by the Prime Minister, Sri P.V.Narasimharao.
New technology, large scale computerization and automation etc are incorporated in the plant. To operate the plant at international levels and attain such labour productivity, the organizational manpower has been rationalized. The plant has a capacity of 3.0 Mtpa of liquid steel and 2.656 Mtpa of saleable steel.
VSP TECHNOLOGY: STATE OF THE ART:
7 meter tall coke oven batteries with coke dry quenching.
• Biggest Blast Furnace in the country.
• Bell less top charging system in Blast Furnace
• 100% slag granulation at the Blast Furnace house.
• Suppressed combustion – LD gas recovery system.
• 100% continuous casting of liquid steel.
• Tempore and Stelmor cooling process in LMM and WRM
• Extensive waste heat recovery systems.
• Comprehensive pollution control measures.
MAJOR SOURCE OF RAW MATERIALS:
|Iron ore lumps and fines |Bailadilla, MP |
|BF Lime Stones |Jaggayyapeta, A.P. |
|SMS Lime Stone |Jaisalmer, Rajasthan |
|BF Dolomite |Dubai |
|SMS Dolomite |Madharam, A.P. |
|Manganese Ore |Chipuripalli, A.P. |
|Boiler Coal |Talcher, Orissa |
|Coking Coal |Australia |
|Water Supply |Yeluru Canal, A.P. |
|Power Supply |Captive Power Plant |
MAJOR UNITS AT VISAKHAPATNAM STEEL PLANT:
|DEPARTMENT |ANNUAL CAPACITY |UNITS (3.0 MT STAGE) |
|Coke Ovens |2,261 |3 batteries each of 67 ovens and 7 Meter height. |
|Sinter Plant |5,256 |2 Sinter machines of 312 Sqm grate area each. |
|Blast Furnace |3,400 |2 Furnaces of 3200 cu.m. Volume each. |
|Steel Melt Shop |3,000 |3 LD converters each of 150 cu.m. Volume and six 4 strand bloom |
| | |casters. |
|LMMM |710 |4 Stand finishing Mill |
|WRM |850 |2 x 10 stand finishing mill |
|MMSM |850 |6 stand finishing mill. |
MAIN PRODUCTS OF VISAKHAPATNAM STEEL PLANT
|STEEL PRODUCTS |BY PRODUCTS |
|Angles |Nut Coke |
|Billets |Coke dust |
|Channels |Coal tar |
|Beams |Anthracene Oil |
|Squares |HP Napthalene |
|Flats |Benezene |
|Rounds |Toluene |
|Rebars |Xylene |
|Wire rods |Wash oil |
VISION
To be continuously growing world –class company,We shall
• Harness our growth potential and sustain profitable growth.
• Deliver high quality and cost competitive products and be the first choice of customers.
• To create an inspiring work environment to unleash the creative energy of people.
• Achieve excellence in enterprise management.
• Be a respected corporate citizen, ensure clean and green environment and develop vibrant communities around.
MISSION
To attain 10 million tones liquid steel capacity through technological up gradation, operation efficient and expansion, to produce steel at international standards of cost quality, and to meet the aspirations of the stakeholders.
OBJECTIVES
• Towards growth –Expand the plant capacity to 7MT by 2011-2012 with the mission to attain 10.0 MT capacities in two subsequent phases.
• Towards profitable –achieve net profits from 2002-2003 with special emphasis on enhancement of production of value added steels and cost reduction.
• Towards employee –Make RINL the employer of choice .upgrade the skills and efficiencies of employees through training and development and maintain high levels of motivation high levels of motivation and satisfaction.
• Towards customers –promote branding of products for quality and customers preference through customers relation management.
• Towards suppliers –Develop a reliable and strong supplier’s base and ensure effective supply chain.
• Towards quality –promote quality movement in all functions of the company through quality management system.
• Towards knowledge management –Become a knowledge based and knowledge sharing company.
• Towards safety, environment and society –Continue efforts towards safety of employees, conservation of environment and be a good cooperate citizen.
CORE VALUES
• Commitment
• Customer satisfaction
• Continuous improvement
• Concern of environment
• Concern of innovation
QUALITY POLICY
We, at Visakhapatnam steel plant, are committed to meet the needs and expectations of our customers and others interested parties .To accomplish this, we will
• Supply quality goods and services to customers’ delight.
• Achieve quality of the products by following systematic approach through planning document Ed procedure and timely review of quality objectives.
• Continuously improve the quality of all materials, process and timely objectives.
• Maintain an enabling environment which encourages team work and active involvement of all employees with their involvement.
HR POLICY
We, at Visakhapatnam steel plant, believe that our employees are the most important resources. To realize the full potential of employees the company is committed to:
• Provide work environment that makes the employees committed are motivated for maximizing productivity.
• Establish systems for maintaining transparency, fairness and equality in dealing with employees.
• Empower employees for enhancing commitment, responsibility and accountability.
• Encourage team work, creativity, innovativeness and high achievement orientation.
• Provide growth and opportunities for developing skill and knowledge.
• Ensure functioning of effective communication channels with employees.
HRD POLICY
We, at Visakhapatnam Steel Plant, are committee to create an organizational culture which nurtures employee’s potential for the prosperity of the organization. To accomplish this, we will
• Identify development needs of the employees on regular basis, provide the necessary training and continually evaluate and monitor the effectiveness of training so that the quality of training also upgraded.
• Provide inputs to the employees for developing their attitude towards work and for matching their competencies with the organizational requirements.
• Create an environment of learning and knowledge sharing by providing the means and facilities and also access to the relevant information and literature.
• Facilitate the employees for continuous development of their knowledge base, skills, efficiency, innovativeness, self-expression and behavior so that they contribute positively with commitment for the growth and prosperity of the organization while maintaining a high level of motivation and satisfaction.
• Prepare employees through appropriate development programme for taking up higher responsibilities in the organization.
• Fulfill social obligation by providing training to the students of educational institutions and to the trainees of other organization.
MARKETING NETWORK OF VISAKHAPATNAM STEEL PLANT:
The products are being sold through 35 marketing centers all over the country with four stock yards at Mumbai, Kolkata, Chennai and Hyderabad. And in other places, consignment agencies have been contracted.
POLLUTION CONTROL AND ENVIRONMENTAL PROTECTION:
Elaborate measures have been adapted to combat air and water pollution in Visakhapatnam Steel Plant. In order to be eco friendly, Visakhapatnam Steel Plant has planted more than 3 million trees in are area of 35 square kilometers and incorporated various technologies at a cost of Rs.460 crores and control measures.
ACHIEVEMNETS AND AWARDS OF VISAKHAPATNAM STEEL PLANT:
The efforts of VSP have been recognized in various forms. Some of the major awards received by VSP are in the area of energy conservation, environment protection, safety, Quality, Quality Circles, Rajbhasha, MOU, Sports and related awards and a number of awards at the in individual level.
Some of the important awards received by VSP are indicted below:
• ISO 9002 for SMS and all the down stream units – a unique distinction in the Indian Steel Industry.
• Indira Priya Darshini Vriskha Mitra Award 1992-93.
• Nehru Memorial National Award for Pollution Control. 1992-93 and 1993-94.
• EEPC Export Excellence Award; 1994-95.
• CII (Southern Region) Energy Conservation Award 1995-96.
• Golden Peacock (1st Prize) “National Quality Award-96” HM in the National Quality Competition 1996.
• Steel Ministers Trophy for “Best Safety Performance – 1996”.
• Selected for “World Quality Commitment Award 1997” of J*BAN, Spain.
• Gold star award for excellent performance in productivity.
• Udyog excellence gold medal award for excellence in Steel Industry.
• Excellence award for outstanding performance in Productivity Management, Quality and Innovation.
• Ispat Suraksha Puraskar (First Prize) for longest Accident Free Period – 1991-94.
• Best Labour Management Award from Government of Andhra Pradesh.
• SCOPE Award for best turn around for 2001.
• Environment Excellence Award from Greentech Foundation for energy conservation in 2002.
• Best enterprise award from SCOPE, WIPS for 2001-02, besides,
• Best Enterprise Award from SCOPE for surpassing MOU targets – 2003-04.
• ISTD Award for “Best HR Practices” – 2002.
• Prime Ministers Trophy for “Best Integrated Steel Plant” 2002-03.
• “World Quality Commitment International Star Award” in the Gold category conferred by Business Initiative Directions, Paris”.
• “Organizational Excellence Award” for 2003-04 by INSSAN.
RINL has been bestowed with several national accolades in the year 2005-09 significant among them being:
• National Energy Conservation Award for the 6th time in succession.
• National Award for Excellence in Water Management.
• ICWAI Award for excellence in Cost Management.
• Viswakharma Rashtriya Puraskar Award (6 out of 32 at the national level)
• FAPCCI best Industrial Productivity Award.
• INSAAN National Award for Organizational Excellence.
• Best CEO Award.
• Best Company to Work Award 2009 Awarded by “The Economic Times and Great Place to Work Institute”.
The above awards at local regional and national level competitions in the area of quality circles and suggestion schemes etc.
Total Quality, latest technology, sophisticated equipment, up to date knowledge, high skills, cost consciousness, production with less cost and customer satisfaction have become the hallmark of VSP.
STATISTICAL INFORMATION
PRODUCTION PERFORMANCE ( TONNES)
|Sl. |Year |Hot |Liquid |Saleable |Labour productivity |
|No. | |Metal |Steel |Steel |(tones/year) |
|1. |2000-2001 |3165 |2909 |2507 |211 |
|2. |2001-2002 |3485 |3083 |2757 |228 |
|3. |2002-2003 |3941 |3356 |3056 |253 |
|4. |2003-2004 |4055 |3508 |3169 |262 |
|5. |2004-2005 |3920 |3560 |3173 |265 |
|6. |2005-2006 |4153 |3603 |3237 |282 |
|7. |2006-2007 |4046 |3606 |3290 |413 |
|8. |2007-2008 |3913 |3322 |3074 |389 |
|9. |2008-2009 |3546 |3145 |2701 |359 |
COMMERCIAL PERFORMANCE (RUPEES IN CRORES)
|Sl.NO. |Year |Sales Turn over |Domestic Sales |Exports |
|1. |1999-2000 |3037 |2677 |360 |
|2. |2000-2001 |3436 |3122 |314 |
|3. |2001-2002 |4081 |3710 |371 |
|4. |2002-2003 |5059 |4433 |626 |
|5. |2003-2004 |6174 |5406 |768 |
|6. |2004-2005 |8181 |7933 |248 |
|7. |2005-2006 |8469 |8026 |443 |
|8. |2006-2007 |9131 |8487 |424 |
|9. |2007-2008 |10433 |9878 |555 |
|10. |2008-2009 |10441 |10330 |78 |
FINANCIAL PERFORMANCE (RUPEES IN CRORES)
|S.No. |Year |Gross Margin |Cash Profit |Net Profit |
|1. |1998-1999 |15 |-346 |- |
|2. |1999-2000 |252 |-130 |-562 |
|3. |2000-2001 |504 |153 |-291 |
|4 |2001-2002 |690 |400 |-75 |
|5. |2002-2003 |1049 |915 |521 |
|6. |2003-2004 |2073 |2024 |1547 |
|7. |2004-2005 |3271 |3260 |2008 |
|8. |2005-2006 |2383 |2355 |1251 |
|9. |2006-2007 |2633 |2584 |1363 |
|10. |2007-2008 |3515 |3483 |1943 |
|11. |2008-2009 |2355 |2267 |1336 |
EXPANSION PLAN:
|Product |Capacity (MT) |Additional Facilities envisaged |
| |Present |Future | |
|Hot Metal |4.00 |6.50 |New BF with 3800 cum capacity |
|Charge Sinter |5.26 |8.50 |New Sinter Plant of 400 Sq.M area |
|Liquid Steel |3.70 |6.30 |SMS-2 with Two 50 Cu.m. Converters, Two 6 Std.Billet Casters and |
| | | |One 6 Std.Round Caster. |
|Saleable Steel |3.3.4 |5.72 |- |
|Wire Rod |1.05 |1.65 |New WRM of 600,000 T/annum |
|Bars and Structural |1.95 |3.40 |New SBM of 750,000 T/annum |
| | | |New SM of 700,000 T/annum |
|Seamless pipes |- |0.30 |Seamless Tube Plant of 300,000 T/annum. |
HUMAN RESOURCE DEVELOPMENT:
It is well recognized every where that human competency development is essential prerequisite for any growth or development of the organization. Human resource development is a newly emerging field of study. Although development of human beings has been in existence in some or other since the beginning of civilization, a planned and systematic approach to HRD in the corporate sector emerged in the later half of the 20th century. Many organizations have set up “HRD Departments” which symbolized the recognition of importance of employee’s competency development.
CONCEPT OF HRD:
HRD in the process of helping people to acquire competencies. It is an organized learning experience aimed at matching the organizational need for human resource with the individual need for career growth and development. In an organizational context HRD is a process by which the employees of an organization are helped in a continuous and planned way to
• Acquire or sharpen capabilities required to perform various functions associated with their present or expected future roles.
• Develop their general capabilities so that they may be able to discover their own inner potentialities and exploit them to fulfill their own and organizational development.
• To develop an organizational culture where superior-subordinate relationship, team work and collaboration among different sub-units are strong and contribute organizational wealth or professional well being and; motivation and pride of the employees.
FEATURES OF HRD:
• Human Resources Development is planned any systematic approach to the development of the people.
• Human Resource Development is a continuous process of developing of the competencies, motivation, dynamism and effectiveness of employees.
• Human Resource Development is an inter-disciplinary concept.
• Human Resource Development is a Process not merely a set of mechanisms and techniques. The techniques like performance appraisal, counseling, training, and organization development are used to initiate, facilitate and promote this process.
OBEJCTIVES OF HRD:
• To provide a comprehensive frame work and method for the development of human resources in an organization.
• To generate systematic information about human resource for purpose of man power planning, succession planning and the like.
• To increase the capabilities of an organization to recruit, retain and motivate talented employees.
• To create a climate that enables every employee to discover, develop and use his/her capabilities to a fuller extent, in order to further both individual and organizational goals.
• The capabilities of each individual in relation to his/her present and expected future roles.
• The dyadic relationship between each employee and his/her supervisors.
NEED FOR HRD:
Competent and motivated employees are essential for organizational survival growth and excellence. Over a period of time, an organization may achieve a saturation point in term of its growth. Even to maintain such a saturation level of growth employee competencies need to be sharpened or developed. Thus HRD is need by every organization that is interested in the following activities.
• Stability itself.
• Growing
• Diversifying
• Renewing itself to become more effective
• Improving its system and services
• Change and becoming more dynamic
• Playing leadership roles.
FUNCTIONS OF HRD DEPARTMENT:
• Develop a HR philosophy for the entire organization.
• Keep inspiring the line managers to have a consistent desire to learn and develop.
• Constantly plan and design new method and systems of developing and strengthening the HRD climate.
• Be aware of the business/other goals of the organization and direct all their HRD effort to achieve these goals.
• Monitor effectively the implementation of various HRD subsystems/mechanisms.
• Work with unions and associations and inspire them.
• Conduct human process research, organizational health surveys and renewal exercises regularly.
• Influence personnel policies by providing necessary inputs to the personnel department/top management.
HRD MECHANISMS:
The following are the mechanisms of HRD
• Performance appraisal system.
• Potential appraisal and development
• Feedback and performance coaching.
• Career planning.
• Training.
• Organizational development.
• Rewards.
• Employee welfare and quality of work life.
• Human resources information system.
PERFORMANCE APPRIALS SYSTEM:
Performance appraisal system is one of the most important mechanisms in most organizations all over the world.
As HRD oriented performance appraisal is used as a mechanism by supervisions to
• Understand the difficulties of their subordinates and try to remover their difficulties.
• Understand the strengths and weakness of their subordinates and help the subordinates to realize these.
• Help the subordinates to become aware of their positive contributions.
• Encourage subordinates to accept more responsibilities and challenges.
• Help subordinates to acquire new capabilities.
• Plan for effective utilization of talents of subordinates.
FEEDBACK AND PERFORMACNE COUNSELLING:
Knowledge of ones strength helps one to become more effective, to choose situations in which ones strengths are required and to avoid situations I which ones weaknesses could create problems. These also increase the satisfactions of individual. Often, people do not recognize their strength. Supervisions in an HRD system have the responsibility for ongoing observations and feedback to subordinates about their strengths and their weaknesses, as well as for guidance in improving performance capabilities.
CAREER PLANNING:
The HRD philosophy is that people perform better when they feel and see meaning in what they are doing. In the HRD system, corporate growth plans are not kept secret doing range plans for the organizations are made known to the employees. Employees are helped to prepare for change when ever such change is planned, in fact the employee’s help to facilitate the change.
TRAINING:
Training is linked with performance appraisal and career development. Employees generally are trained on the job or through special in house training programmes. For some employees (including executives) outside training may be utilized to enhance, update to develop specific skills. This is especially valuable if the external training can provide expertise, equipments, or sharing of experience that is not available within the organization.
In house training programmes are developed by in house trainers or consultants hired for the task and periodic assessments are made of the training needs within needs, managers and employees who attend in house or outside training events are also expected to submit proposals concerning any changes they would like to suggest on the basis of their new knowledge. The training received by employees is thus utilized by the organization.
ORGANISATION DEVELOPMENT:
The function includes research to ascertain the psychological health of the organization. This is generally accomplished by means of periodic employee surveys. Efforts are made to improve organizational health through various means in order to maintain a psychological climate that is conductive to productivity. The organizational development or systems experts also help any department or unit in the company that has problems such as absenteeism, low resistance to change.
REWARDS:
Rewarding employee’s performance and behaviors is important part of HRD. Appropriate rewards not only recognize and motivate employees, but also communicate the organization value to the employees. In HRD systems, innovations and use of capabilities are rewarded in order to encourage the acquisition and application, newsletter announcements, increase in salary bonuses, special privileges and desired training rewards may be given to individual as well as to teams, departments, main and other units within the organization.
EMPLOYEE WELFARE AND QUALITY OF WORK LIFE:
Employees at lower in the organization usually perform relatively monotonous task and have fewer opportunities for promotion or change. This is particularly true in developing countries. In order to maintain their work commitment and motivations the organization must provide some welfare benefits such as medical insurance, disability insurance, holidays and vacation.
Quality of work life programmes generally focus on the environment within the organization includes basic physical amenities such as food and beverage facilities. Recreation and aesthetic and psychological and motivations, factors such as flexible work hours, freedom to suggest change or improvements, challenging work and varying degree of autonomy.
HRD IN VISAKHAPATNAM STEEL PLANT:
The VSP has a nice HRD department with talented and experienced staff. It is following more or less all the above mentioned HRD mechanisms. The HRD staff is very friendly and cooperative.
PHILOSOPHY OF HRD:
• Employees of the company are its greatest and most valuable resources.
• While on the hand HRD should appropriately harness employees potential for the attainment of company as its corporate responsibility should create an enabling the best opportunity for self expression all round development and fulfillment.
• People are more than mere resources and therefore, it will be a person with all the respect and sensitivity that are all the respect and sensitivity that is warranted when employees are seen as more than mere instrumentality.
• HRD as a management function will be given a place of strategic priority along with function like production, maintenance, materials or finance in the overall scheme of management action in the company.
• HRD does not refer to training alone or it is just a new name for training. In RINL/VSP, HRD several management functions, for the development and growth of employees.
• HRD should eventually be a core philosophy of all management action and should not remain merely a report mental/sectional activity.
• All functional and divisional heads responsible for various activities of the company will the HRD spirit and suitably integrate HRD into their plans, decisions and actions.
HRD OBJECTIVES:
• To provide initially a suitable match between employee competence levels and company’s work requirements.
• To foster an appropriate climate and culture which nature. Employee competence and crease adequate motivational levels for the application of their abilities to assigned job/roles with required commitment.
• To enable employees seek great identification with the company by infusing most management decisions and actions with the requisite care, concern and development approach.
• To work towards enabling the employees and other stakeholders ask self fulfillment even work for the growth and prosperity of the company.
• To utilization enable to employees and the organization to achieve its mission and objectives and business goals through HRD.
HRD GROUP KEY ACTIVITY:
• TQM and in house programmes.
• Nomination to external programmes.
• Organization research and organization development.
• Membership with professional bodies.
• Performance appraisal for executives.
• Human resource information.
• In plant training for management studies.
• Lectures by eminent personalities.
• Corporate presentations.
• Interactions with professional academicians and consultants.
CHAPTER-III
PERFORMANCE APPRAISAL SYSTEM
INTRODUCTION:
Performance appraisal is widely used in the society. The parent evaluates the behaviour of their children, teacher evaluates their student and employers evaluate their employees. However, formal evaluation of employees is believed to have been adopted for the first time during First World War. The systematic performance appraisal was quite prominent in the recent years. Credit goes to Walter Dill Scott for “systematic performance appraisal technique” of man-man rating system (or merit rating). It was used for evaluating military officers. Once the employee has been selected, trained the motivated, he is then appraised for his performance. Performance appraisal is the step where the management finds out how effective it has been at hiring and placing employees if any problems are identified, steps are taken to communicate the employee and to remedy them. A performance appraisal is a process of evaluating the performance and qualification of employee according to job and its requirement. It is also known as the process of estimating and judging the value, excellence. Qualities of status of some object person or things. Individually and collectively, it is the part of all other staffing process, like recruitment, selection, placement etc.
TRENDS IN PERFORMANCE APPRAISAL:
|Item |Former Emphasis |Present Focus |
|Terminology |Merit-rating |Performance appraisal |
|Purpose |Determining qualification of wage increase, promotion, transfer,|Development of the individual, improved. |
| |lay off. | |
|Application |For rank and file workers |For managerial and technical personnel. |
|Factors rates |Personal traits |Performance results or accomplishments. |
|Techniques |Rating scales with emphasis upon scores |Mutual goal-setting, critical incidents, |
| | |group, appraisal. |
CONCEPT OF PERFORMANCE APPRAISAL:
Performance evaluation or performance appraisal is the process of assessing performance and progress of employee or of a group of employee on a given job and his potential for future development. In concept of all formal procedure used working organization to evaluate personality, contribution and potential of employees.
The main characteristic of performance appraisal is a follows:
1. Performance appraisal is the process consisting of series of steps.
2. It is the systematic examination of employee’s strength and weakness in terms of jobs.
3. Performance appraisal is the scientific or objective study. Formal procedure is used in the study the same approach is adopted for all job holders for that result is comparable.
4. It is an organizing or continuous process where in the valuation is arranged periodically according to a definite plan.
5. The main process performance appraisal is to secure information necessary for making objective and correct decision on employees.
OBJECTIVES OF PERFORMANCE APPRAISAL:
The main purposes of performance appraisal are as follows:
1. To provide a valid data base for personnel decision concerning placements, pay, promotion, transfer, punishment etc.
2. To diagnosis the strength and weakness of individuals so as to identify further training needs.
3. To provide coaching, counselling, career planning and motivation to subordinates.
4. To develop positive, superior-subordinate relations and there by reduce grievances.
5. To facilitate research in personnel management.
6. To test the effectiveness of the recruitment, selection, placement and induction programme.
Thus performance appraisal aims at both judgmental and developmental efforts.
DEFINITION:
Performance evaluation or performance appraisal is the process of assessing the performance and progress of an employee or of a group of employees on a given job and his potential for future development.
FORMAL DEFINITION.
“It is the systematic evaluation of the individual with respect to his/her performance on the job and his/her potential for development”.
According to Flippo
“Performance Appraisal is the systematic, periodic and an impartial rating of an employee’s excellence in matters pertaining to his present job and his potential for a better job”.
Uses:
1. It provides valuable information for personnel decisions such as pay increase, promotions etc.
2. It helps to judge the effectiveness of recruitment, selection, placement and orientation system of the organization.
3. It is useful in analyzing training and development needs.
4. It can be used to improve performance though appropriate feedback, working and counselling to employees.
5. It facilitates Human Resource Planning and succession planning.
A competitive sprit is created and employees are motivated to improve their performance.
Process of Performance Appraisal:
• Establishing Performance standards – the appraisal process begins with the setting up of a criteria to be used for appraising the performance of employees. The criteria are specified with the help of job analysis, which reveals the contents of job. This criteria should be clear, objective and in writing.
• Communicating the standards – the standards are conveyed to the employees and the evaluators. A feedback regarding the standards should be obtained from the evaluators and the employees for revision or medication.
• Measuring performance - this requires choosing the right techniques of measurement, identifying the internal and external factors influencing performance and collecting information on results achieved.
• Comparing the actual with the standards – actual performance is compared with the predetermined performance standards. Such comparison will reveal the deviation, which may be positive or negative.
• Discussing the appraisal - The results of the appraisal are communicated to and discussed with the employees. Along with the deviation, the reason behind them are also analysed and discussed. Such discussion will enable the employee to know his weaknesses and strengths.
• Taking corrective actions – through mutual discussions with employees, the steps required to improve performance are identified and initiated. Training, caching, counselling etc, are examples of corrective actions that help to improve performance.
METHODS OF PERFORMANCE APPRAISAL:
Several methods and techniques are used for evaluating employee performance. These may be classified into Traditional and Modern Methods.
Traditional Methods
• Ranking Methods: In this technique, evaluator assigns relative ranks to all employees in the same work unit doing the same job. Employees are ranked from the best to the poorest on the basis of overall performance. The relative passion of an employee is reflected in the numerical rank. It is one of the simplest methods. It is time saving and comparative evaluation technique of appraisal.
• Man-to-Man comparison method: In this method, certain factors are selected for the purpose of analysis and the rater for each factor designs a scale. A scale of man is also created for each selected for each factor. Then each man to be rated is compared with the man in the scale, and certain scores are awarded to him. In other words, a whole man is compared to a “key man” in respect of one factor at a time. This method is used in job evaluation and is known as the factor comparison method.
• Paired comparison method – This is a modified form of man to man ranking. Herein, each employee is compared with all others in pairs on at a time. The number of times an employee is judged better than other determines his rank. Comparison is made on the basis of overall performance.
• Forced distribution method – In these techniques the rater appraise an employee according to a predetermined distribution scale. It is assumed that it is desirable to rate only two factors by this method that is job performance and promotability. For this purpose a five poking performance scale is used without any descriptive statement and employees are placed between two extremes of good and bad performance.
• Graphic rating scales method – It is a numerical scale indicating different degrees of a particular train. The rater is given a printed form for each employee to be rated. The form contains several characteristics relating to the personality and performance of employee. Intelligence, attitude, quality of world, leadership skills judgement etc., are some use characteristics. This method is widely used as it is easy to understand. It allows a statistical tabulation of scores and a ready comparison of scores among the employees is possible. The approach is multi-dimensional as several significant dimensions of the job can be considered in evaluation.
• Critical incident method – In this method the superior keeps a written record or critical (either good or bad) events and how different employees behaved during such events. The rating of the employee depends on the positive or the negative behaviours during these events. These critical incidents are identified after through study of the job and discussions with the staff. This method helps to avoid vague impressions and General remarks as the rating are based on actual records of behaviour.
• Group appraisal method – Under this method, a group of evaluators assess employees. This group consists of the immediate supervisors of the employees, other supervisors having close contact with the employer’s work, head of the department and a personnel expert. The group determines the standards of performance for the job, measures actual performance of an employee’s analysis the causes of poor performance and offers suggestions for improvement in future.
• Grading method – under this method, the rater considers certain factors, and marks them accordingly to a scale. The selected factor may be analytical ability, co-operation, dependability self-expression, job knowledge. They may be graded as “A”- outstanding, “B” – very good, “C” – good/average, “D” – fair, “E”-poor. The actual performance of an employee is then compared with these grade definitions and he is allotted the grade which best described his performance.
• Forced choice Distribution method – In this method, the rating elements are several sets of pair’s phrases or adjectives relating to job proficiency or personal qualification. The rater is asked to indicate which of the phrases is most and least descriptive of the employee.
• Checklist method – In this method, series of questions are presented concerning an employee’s behaviour. Here rater does not evaluate employee performance, he supplies reports about it and the personnel department does the final rating.
• Free Essay Method – In this method, the supervisor makes a free form, open ended appraisal of an employee in his own words and puts down his impression about the employee. The description is always as factual and concrete as possible.
• Field review method - In this method, a trainer employee from the personnel department interviews line supervisors to evaluate respective subordinates. The supervisor is required to give his opinion about the progress of his subordinates and his plan of action in cases requiring for consideration.
The traditional methods have given above focus on the traits of an employee than his job performance. In the absence of predefined performance criteria or standards, the personal bias or subjectivity of the evaluator affects the ratings. This approach caused the following responses:
• The very nature of the appraisal system led to criticism.
• Criticism exercised a negative impact on goal attainment.
• Criticism increased antagonism and defensiveness among employees resulting in inferior performance.
• Managers generally are not qualified to assess personality traits.
• Some managers discourage good performances by over emphasizing shortcomings and almost neglecting good work.
In order to overcome these weaknesses some new techniques of performances appraisal have been developed.
Modern methods
• Assessments centre method – An assessments centre is a group of employee drawn from different work units. These employees work together on assignments similar to the one they would be handlings when promoted. The most important feature of the assessments centre is job related simulations. Evaluators observe and rank the performances of all participants. This group evaluates all employees are both individually and collectively by using simulations techniques like role playing, business games and in basket exercises? Employees are Evaluated on the basis of job related characteristics considered important for job success. The evaluators prepare a summary report and feedback is administered on a face to face basis to the employees who ask for it. An assessment centre generally measures interpersonal skills, communicating ability to plan and organise etc. Assessments centres are not only methods of appraisal but help to determine training and development needs of employees and provide data for human resource planning.
• Human resource accounting method – Human resource are a valuable asset for any organization. This asset can be valued in terms of money. When competent and well trained employees leave an organization the human asset is decreased and vice versa. Under this method performance is judged in terms of costs and contributions of employees. A cost of human resources consists of expenditure on human resource planning, recruitment, selection, induction, training, compensation etc. Contribution of human resources is the money value of labour productivity or value added by human resources. Difference between cost and contribution will reflect the performance of employees. This method is still in the transitory stage and is therefore, not popular at present.
• Behavioural Anchored Rating Scales (BARS) – This method combines graphic rating with critical incidents method. BARS are description of various degrees of behaviour relating to specific performance dimensions. Critical areas of job performance and the most effective behaviour for getting results are determined in advance. The rater records the observable job behaviour of an employee and compares these observations with BARS. In this way an employee’s actual behaviour is judged against the desired behaviour. This steps involved are
• Collect critical incidents - Persons with knowledge of the identify job to be appraised describe specific examples of both effective and ineffective job behaviours.
• Identify performance dimensions – The persons then clusters the behavioural incidents into a smaller set (usually 5-10) of performance dimensions.
• Retranslate the incident – Another group of knowledgeable persons assign each incident to the dimension that it best describes. Incidents for which there is less than 75% agreement with the first group are not retranslated.
• Assign scales to incidents – The second group rates each incident on a 7 or 9 point scale. Rating is done on the basis of how well the behaviour described in the incident represents the performance on the appropriate dimensions. Means (average) and standards deviations are then calculated for the scale values assigned to each incident.
• Develop final instrument – A subset of the incident that meets both the retranslation and standard deviation criteria is used as a behavioural anchor for the final performance dimensions. A final BARS instrument typically comprises a series of vertical scales that the endorsed by the include incidents. Each incident is positioned on the scale according to its mean value.
• 360 degree performance appraisal – This is a new concept in performance appraisal, where the feedback is collected from all around – the employee, the superior, the subordinates, the peer group, and the customers. The evaluation is very comprehensive in terms of the employee’s skills, ability, styles, and job related competencies. This system has the following advantages:
a) Higher validity and reliability of the evaluation.
b) Self evaluation by the employees gets compared with the perception of others.
c) Helps in maximizing employee potential in the face of challenges.
ADVANTAGES OF BARS:
• Ratings are likely to be accurate because these are done by experts.
• The method is more reliable and valid as it is job specific and identified observable and measurable behaviour.
• Ratings are likely to be more acceptable due to employee participation.
• The use of critical incidents is useful in providing feed back to the employee being rated.
Limitations of the bars:
• It is very time consuming and expensive to develop BARS for every job.
• Behaviours used are more activity oriented than result oriented.
Appraisal by results or MBO (Management by Objectives) – The concept of management by objectives was developed by Peter Drucker in 1954. Since, then MBO has become an effective and operational technique of performance appraisal and a powerful philosophy of managing.
MBO has been defined as “a process whereby the superior and subordinate managers of an organization jointly identify its common goal, define each individual’s major areas of responsibility in terms of results expected of him and use these measures as guides for operating the unit and assessing the contributions of each its members”. In other words, MBO involves appraisal of performance against clear, time bound and mutually agreed job goals.
PROCESS OF MBO:
• Set organization goals – Goals of the organization in key areas of performance are laid down. These goals are defined in clear, precise and measurable terms. A through analysis of internal and external environment of the organization is made to set these goals.
• Defining performance targets – On the basis of organizational goals, performance standards for each employee are defined. Every subordinate writes down his own performance goals, which are work related, and career oriented. His manager also writes down the goals he thinks the subordinate should strive for. The two then discuss them, reach an agreement and put the agreed goals in writing. Thus, employees at all levels are involved in goal setting. The goals are periodically reviewed and revised to keep them flexible and upto date.
• Performance review – Frequent performance review, meetings between manager and subordinates are held. In these meetings progress is assessed, weaknesses and constraints are identified and steps to be taken to improve performance are decided. Subordinates actively participate in this process. This leads to self control by the employees.
• Feed back – After every performance review feedback on performance is communicated to the employee so that he can regulate and improve upon his own performance. On the basis of performance review rewards are decided. New goals and performance targets are determined for the next period.
ADVANTAGES:
➢ Ends – means chain
➢ Role clarify
➢ Objective appraisal
➢ Motivation and commitment
➢ Management development
➢ Co-ordination
LIMITATIONS:
➢ Difficulty in goal setting
➢ Problem of participation
➢ Lack of understanding
➢ Time consuming and expensive
➢ Inflexibility
SHORT COMINGS OF PERFORMANCE APPRAISAL:
The ideal approach to performance evaluation is that in which the evaluator is free from personal biases, prejudices, and idiosyncrasies. This is because when an evaluation is objective, it minimizes the dysfunctional behavioural of the evaluator, which may be detrimental to the achievement of organizational goals. The factors which impede objective evaluations are:
• The halo effect – The halo effect is a “tendency to let the assessment of an individual one trait influence the evaluation of that person on other specific traits”. There is this effect in appraisal when the appraiser assigns the same rating to all traits regardless of an employee’s actual performance on these traits.The halo effect refers to the tendency to rte an individual consistently high or low or average on the various traits, depending upon whether the rater’s overall impression of the individual is favourable or not. This means that the halo effect allows one characteristic, or occurrence (either good or bad) to Influence the rating of all performance factors. The halo effect problem can be alleviated by:
• Providing a training programmer to the evaluators.
• Restructuring the questions by requiring the evaluator to consider each question independently.
• Leniency or strictness tendency - Every evaluator has his own value system which acts as a standard against which he makes his appraisals. Relative to the true or actual performance an individual exhibits, some supervisors have a tendency to be liberal in their rating, that is they consistently assign ‘high values’ to their employees, while at other times they may have a tendency to assign consistently ‘low rating’. The former tendency is known as ‘positive leniency error’ while the latter as ‘negative leniency error’. Both these trends usually arise from varying standards of performance observed by supervisors and from different interpretations of what they evaluate in employee performance. The tendency can be avoided by holding meeting or training sessions for raters so that they may understand what is required of them in rating.
• The central tendency problem - It is the most commonly found error. It assigns “average ratings” to all the employees with a view to avoiding commitment or involvement; or when the rater is in doubt or has inadequate information or lack of knowledge about the behaviour of the employee, or when he does not have much time at his disposal. The ranking tools discussed earlier are aimed at avoiding this problem.
• Similarity error – This type of error occurs when the evaluator rates other people in the same way he perceives himself. This error also washes out if the same evaluator appraises all the people in the organization.
• Miscellaneous biases – Bias against employees on ground of sex, race, religion or position is also a common error in rating. For example, a higher rating may be given to a senior employee. The rater may also be influenced by organizational influence and give higher rating to those holding higher positions.
• Social differentiation – Rating is sometimes impeded by the evaluator’s style of behaviour. Pious has classified raters as high differentiations that is using most of the scale; or ‘low differentiators’ – that is, using a limited range of the scale. “Low differentiators tend to ignore or suppress differences, perceiving the universe as more uniform than it really is.
High differentiators, on the other hand, tend to utilise all available information to the utmost extent and thus are better able to perceptually deny anomalies and contradictions than low differentiators”. A social differentiation makes evaluation using ‘trait’ criteria unreliable.
• Spill Over Effect – This type of error occurs when past performance rating influences the current rating.
• STEPS FOR MAKING APPRAISAL SUCCESSFUL:
• Existence of an atmosphere of confidence and trust.
• The results of performance rather than personality traits should be given due weight.
• The supervisor should analyse the strengths and weaknesses of employee and advise him.
• The appraisal programmes should be less time consuming and less costly.
• The results of appraisal should be immediately communicated to the employee.
• A post appraisal interview should be arranged.
• Training can be used to improve the standards of performance appraisal.
• The right appraisal tools should be chosen to minimize arising problem.
PERFORMANCE APPRAISAL AT VISAKHAPATNAM STEEL PLANT
COMPONENTS:
When to appraise:
Performance appraisal across all levels at Visakhapatnam Steel Plant is conducted twice in a year. The Human Resource Department sends the appraisal forms to the concerned departments after duly filling the staff details.
Who should appraise:
The immediate superior of the employee not below the Assistant Manager cadre shall be the Reporting Officer. In case the employee is directly working under the supervision of any higher officer.
PROCEDURE:
The Human Resource Department prepares appraisal forms for each and every category of employee and at the start of the appraisal period; it sends these forms to the concerned departments after filling in the necessary details of the employee to be appraised which is called ‘background information’.
The staff should have worked at least for a period of 6 months to be appraised by an officer. In case the appraise reports to more than one Reporting officer in an appraisal year, on transfer, promotion etc., the personnel department would forward the appraisal forms to Reporting officer concerned for the period the appraise reports to them.
The assessment of an employee is primarily governed under a 2 tie system that is assessment by the Reporting Officer as well as by the Reviewing Officer, where the assessment is subject to concurrence of the Consenting Authority, which will be final.
The assessment has done on the basis of certain attributes/factors which help in defining the job requirements of a particular job. Usually a 4 point scale or a 10 point scale for each factor is used for rating. Once the reporting officer gives his rating and comments if any, the same shall be put to the reviewing officer who after careful scrutiny of the appraisal will pass his remarks.
After the Reviewing Officer’s comments are given and duly signed by him, he can advice the reporting officer to discuss the appraisal with the employer or, in certain cases may decide to discuss the appraisal with the employee himself but in the presence of the Reporting Officer.
The Reporting Officer after rating the employee on various attributes will give his remarks, which are communicated to the reviewing officer. Later these are discussed with the employee to know his reaction. After the discussion with the employee, the reporting officers give his final remarks and his suggestions for improvement of the employee performance. The reviewing officer for further comments later scrutinizes these.
The complete appraisal report is then sent back to the personnel department in a confidential cover. The personnel department will then check the appraisal report for irregularities and any adverse entries against any of the employee made by the reporting officer will be communicated to the employee in a covering letter asked him/her to improve and a copy of the same will be placed in his/her personal file.
OBJECTIVES OF PERFORMANCE APPRAISAL SYSTEM:
• To appraise the individual’s performance on the work assigned to him and qualities he is expected to show on the job in performing his tasks as expected by the organization through his supervising officers and to assess the potential for higher responsibilities.
• To generate inputs for promotions, confirmation, placements, training and personnel and developmental decisions in respect of the individual so appraised.
• To assess the professional, managerial, behaviour and other training and development needs and provide information to the personnel/HRD department for the development decisions.
GUIDELINES FOR APPRAISERS:
• The employee should be appraised for his/her present position.
• Judgement should be based on the entire review period and not on isolated incidents.
• Snap judgements should be avoided.
• Each factor under considerations should be appraised independently without being influenced by other factors.
• It is advisable that the individual being assessed should compare with others of the same rank employed on more or less similar type of work.
• Over – rating as well as under –rating diminishes the value of the assessment.
• Reason for giving rating of the attribute should be well substantiated.
• A copy of the adverse remarks communicated to the employee should be attached to the appraisal form.
ABOUT THE FORMS:
Content of the forms:
BACKGROUND INFORMATION of the employee to be filled in by the Personnel Department which contains:
1. Name
2. Designation
3. Date of Joining
4. Department
5. Employee Number
6. Special assignments
7. Qualifications
8. Commendations
9. Punishments and warnings awarded during the year (with reasons).
ATTRIBUTES FOR PERFORMANCE/POTENTIAL ASSESSMENT;
For Officers:
• Professional knowledge and application
• Capacity to achieve results
• Dependability
• Judgement and decision making
• Communication Skills (Written or oral)
• Leadership
• Planning and organizing ability
• Cooperation and team spirit
• Adaptability
• Personality
For Technical/Non-Technical Staff (Common Attributes):
• Job knowledge: Knowledge and understanding of job assigned.
• Quality of work: Thoroughness and accuracy of work done without mistakes, neatness and present ability should be considered.
• Conduct: Ability to get on with other fellow employees.
• Regularity: Punctuality and regularity of attendance.
• Leadership: Ability to get work done by subordinates giving them clear guidance.
• Cost consciousness: Ability to foresee the resource requirement for any task and complete assignments with minimum waste.
For Technical Staff only:
• Safety Consciousness: Habits and work practices in respect of personal safety and safety of fellow employees.
• Care of tool and equipment: Manner in which tool and equipment handling is done ensuring better tool life and less maintenance and damage.
For Non-technical Staff only:
Dealing with others: Ability to appreciate others point of view and approach in dealing with customers, supplies or any other outsiders in conformity with organizational requirements.
RATING OF ATTRIBUTES:
The common factors and the ratings under which the appraisals are made as follows:
QUANTITY OF OUTPUT: Extent of target fulfilment and completion of assigned tasks.
|RATING |REASON |
|15-13 |Output of work exceptionally high and above expectations/task assigned despite high degree of |
| |difficulty of tasks. |
|12-10 |Fulfilment of all tasks/targets despite constraints. |
|9-7 |Tasks assigned generally met with moderate effort. |
|6-4 |Output below target/expectation despite lack of constraints. Moderate effort. |
|3-1 |Output far below expectation. Target/Tasks not fulfilled. Low effort. |
QUALITY OF OUTPUT: General excellence of output, the extent of work free from efforts.
|RATING |REASONS |
|15-13 |Excellent quality of output accurate in work under all conditions. |
|12-10 |Does a thorough and accurate job. |
|9-7 |Generally produces work of acceptable quality. |
|6-4 |Work barely up to the mark. |
|3-1 |Works consistently below required standards. |
COST CONTORL: Awareness of cost aspects in the job. Optimum utilisation of available resources and reduction of wastes.
|RATING |REASONS |
|10-9 |Always makes optimum utilisation of resources. |
|8-7 |All assigned tasks completed within the specific cost parameters. |
|6-5 |Generally keeps within cost parameters and time schedules. |
|4-3 |Conscious of the need to affect economy and manage time. |
|2-1 |Wasteful in work. Lacks desire to complete assignments in time. |
JOB KNOWLEDGE AND SKILL: Knowledge pertaining to the area of work and related areas.
|RATING |REASONS |
|10-9 |Excellent ability to anticipate future work needs ahead of time. |
|8-7 |Good knowledge of his own job and related areas. |
|6-5 |Knowledge adequate in own area. |
|4-3 |Knowledge inadequate in own and related areas. |
|2-1 |Poor knowledge. No motivation to learn. |
DISCIPLINE: Adherence to company policies and rules.
|RATING |REASONS |
|10-9 |Exemplary behaviour and conduct. |
|8-7 |Good behaviour and conduct. |
|6-5 |Discipline is generally good. |
|4-3 |Conduct and discipline within manageable limit. |
|2-1 |Low in discipline. |
INTIATIVE: Ability to be self reliant and move forward on a task without outside direction.
|RATING |REASONS |
|10-9 |Totally self-reliant. A self starter |
|8-7 |Good initiative |
|6-5 |Generally shows good initiative |
|4-3 |Needs guidance, instructions and follow up. |
|2-1 |Always requires to be told. |
COMMUNICATION: Skills and desire to share available information with all concerned.
|RATING |REASONS |
|10-9 | Excellent clarity of thought and expression. |
|8-7 |Shares information with all concerned. |
|6-5 |Has moderate skill and desire to share information. |
|4-3 |Only believes in downward communication. |
|2-1 |Lacks both the skill and the will to communicate |
MANAGEMENT OF HUMAN RESOURCES: Effective control and utilisation of subordinates, ensuring discipline, integrating employees into teams and motivating them for higher levels of performance.
|RATING |REASONS |
|5 |Excellent control over and utilisation of people. |
|4 |Good utilisation of people |
|3 |Plays basically a controlling function |
|2 |Has little control |
|1 |Has to control over his/her people. |
CHAPTER-IV
DATA ANALYSIS AND INTERPRETATION:
A sample of 60 respondents was elected at random from different departments.
A survey was conducted by way of questionnaire to find out whether the employees are satisfied with the existing system and their opinions on rated areas.
The questionnaires consists of 19 questions to evaluate the performance of the employees in VSP and this questionnaire is submitted to all departmental executives in the organization and they take 20 minutes to fill the questionnaire.
After the filling of questionnaire, the analysis part of the study is started. The graphical representation is based on the response to the answers submitted by the employees and these are analysed in the percentage form.
By knowing the percentage, we can identify the performance of the employee and to identify the way of thinking of employees. By this analysis, we can determine the deficiencies in the organization.
The responses were given by respondents were tabulated and a score sheet is prepared and graphically represented in the following study.
Data collected from 60 different categories of respondents from different departments
TABLE NO.4.0
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Junior officer |18 |30 |
|2. |Junior manager |16 |26.66 |
|3. |Assistant manager |12 |20 |
|4. |Deputy manager |9 |15 |
|5. |Manager |5 |8.33 |
| |TOTAL |60 |100 |
The above table No.4.0 shows that most of the respondents are Junior Manger (30%), Junior Manager (26.66%) and Assistant Manager (20). They are all front line engineers some of them are directly recruited as a junior manager and some of them are internally promoted candidates.
BAR DIAGRAM 4.0
[pic]
HAPPY BEING ASSOCIATED WITH VSP:
TABLE NO.4.1
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |0 |0 |
|2. |Disagree |0 |0 |
|3. |Agree |32 |53.3 |
|4. |Strongly Agree |28 |46.7 |
| |TOTAL |60 |100 |
The above table No.4 1 shows that most of the respondents (46.7 %) are strongly agree. Because, the employees in VSP are satisfied to do work with pleasure. The organization provide favourable climate to employees in their work life. So, employees of VSP are happy to work with the organization. Some of them are Agree (53.3 %).
BAR DIAGRAM 4.1
[pic]
IS THERE PERFORMANCE APPRAISAL SYSTEM IN RINL/VSP:
TABLE NO.4.2
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. | Yes |60 |100 |
|2. | No. |0 |0 |
| |TOTAL |60 |100 |
The above Table No.4.2 shows total numbers of respondents (100%) are agree. Because the employees in VSP are satisfied to do work with pleasure. The organization provide favourable climate to employees in their work life. So, employees of VSP are happy to work with the organisation.
BAR DIAGRAM 4.2
[pic]
EMPLOYEES OPINION ON PRESENT PERFORMANCE APPRAISAL SYSTEM IN RINL/VSP.
TABLE NO. 4.3
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Excellent |06 |10 |
|2. |Good |27 |45.40 |
|3. |Moderate |22 |36.60 |
|4. |Bad |05 |7.8 |
| |TOTAL |60 |100 |
The above table No.4.3 explains about the present performance appraisal system, most of them agreed as good (45.40%). Some are Moderate (36.60%). Some employees says excellent who are benefited in their work life (10%) and very less persons say it is bad (7.8 %). By this we can evaluate the drawbacks of the present system in VSP.
PIE DIAGRAM .4.3
[pic]
PERFORMANCE APPRAISAL SYSTEM HELPS IN ASSESSING COMPTENCY
TABLE NO.4.4
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |4 |6.66 |
|2. |Disagree |15 |25 |
|3. |Agree |36 |60 |
|4. |Strongly Agree |5 |8.34 |
| |TOTAL |60 |100 |
The above table no.4.4 explains the performance appraisal system helps in assessing competency of employees. Here, employees agree (60%). Most of the employees think that the performance appraisal system is used to measure the competencies of them.
PYRAMID DIAGRAM .4.4
[pic]
PERFORMANCE APPRAISAL SYSTEM CREATES AN EFFECTIVE WORK ENVIRONMENT AND POSITIVE RELATIONSHIPS.
TABLE NO.4.5
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |0 |0 |
|2. |Disagree |16 |26.6 |
|3. |Agree |37 |61.6 |
|4. |Strongly Agree |7 |11.8 |
| |TOTAL |60 |100 |
The above table 4.5 explains that the performance appraisal helps in creating a effective work environment the employee are agreed (61.6 %), employees are strongly agree (11.8 %). Employees are strongly disagreeing (26.6%) to the statement. By this we can understand the behavioural attitude of an employee towards performance appraisal system. Most of them are agreed and fewer members are disagreed.
LINE DIAGRAM NO.4.5
[pic]
PERFORMANCE APPRAISAL SYSTEM HELPS TO KNOW THE STRENGTHS AND WEAKNESS OF SUBORDINATES.
TABLE NO. 4.6
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |0 |0 |
|2. |Disagree |12 |20 |
|3. |Agree |40 |66.6 |
|4. |Strongly Agree |8 |13.4 |
| |TOTAL |60 |100 |
The above table no.4.5 explains about does the performance appraisal system helps in knowing the strengths and weakness of subordinates to this statement employees are agree (66.6% ) and employee are strongly agree ( 13.4 %). So, employees (66.6%) are agree to this system is useful to knowing the strengths and weakness of subordinates and it is an important activity to assess the performance of the employee.
DOUGHNUT DIAGRAM: 4.6
[pic]
LOW PERFORMANCE IS DUE TO LACK OF SKILL
TABLE NO. 4.7
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |6 |10 |
|2. |Disagree |36 |60 |
|3. |Agree |18 |30 |
|4. |Strongly Agree |0 |0 |
| |TOTAL |60 |100 |
The above table no.4.7 explains that employees disagree that low performance is due to lack of skills (60%), agree the statement (30%) strongly agree (0%) and employees a strongly disagree (10%) By the above analysis employees are not agree because less performance due to lack of guidance about the work not due to lack of skills.
BAR DIAGRAM: 4.7
[pic]
PERFORMANCE APPRAISAL HELP IN ASSESSING THE TRAINING NEEDS OF THE SUBORDINATES
TABLE 4.8
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Yes |21 |35 |
|2. |No |10 |16.6 |
|3. |Sometimes |29 |48.4 |
|4. | | | |
| |TOTAL |60 |100 |
The above table No.4.8 shows the employees think performance appraisal helps in assessing the training needs of the subordinates (35 %). Employees (16.6 %) are sometimes it is and employees (48.4 %) tick. No. By this analysis the responses most of the percentage said yes and sometimes, very low percentage say no. Due to this analysis we can assess that almost employees are aware of performance appraisal is necessary for training.
BAR DIAGRAM: 4.8
[pic]
PERFORMANCE APPRAISAL SYSTEM ENCOURAGES PEOPLE TO PLAN THEIR WORK WELL IN ADVANCE.
TABLE NO.4.9
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |0 |0 |
|2. |Disagree |16 |26.6 |
|3. |Agree |39 |65 |
|4. |Strongly Agree |5 |8.4 |
| |TOTAL |60 |100 |
The above table no.4.9 shows that respondents agree (65%). Disagree (26.6 %) Strongly disagree (0%) and remaining strongly agree (8.4 %). With the statement performance appraisal system encourages people to plan their work well in advance.
CONE DIAGRAM .4.9
[pic]
THE OBJECTIVES OF THE PERFORMANCE APPRAISAL SYSTEM ARE CLEARLY SPELT OUT
TABLE NO.4.10
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |0 |0 |
|2. |Disagree |11 |18.4 |
|3. |Agree |49 |81.6 |
|4. |Strongly Agree |0 |0 |
| |TOTAL |60 |100 |
The above table No.4.10 explains about the objectives of the performance appraisal system is clearly spelt out to the employees. As per my survey most of the employees are agree (81.6 %) and some employee are disagree (18.4 %). The organization creates awareness to employees about the objectives of the performance appraisal we can determine through response.
PIE DIAGRAM: 4.10
[pic]
BEST PERSON TO CONDUCT PERFORMANCE APPRAISAL SYSTEM
TABLE NO.4.11
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Superior |46 |76.8 |
|2. |Subordinates |4 |6.6 |
|3. |Peers |5 |8.3 |
|4. |HOD |5 |8.3 |
| |TOTAL |60 |100 |
The above table No. 4.11 explains regarding who is the best person to conduct performance appraisal system in the organisation. Half of the employees agreed that their superior (76.8 %) employees are agreed that their peers (8.3 %) employees are agreed that their HOD (8.3 %) and remaining employees are agreed that their sub-ordinates are the best person. This response is based on their way of thinking about the person above cadre to him/her. It can be determine through close relation with their superiors.
CYLENDER DIAGRAM: 4.11
[pic]
PERFORMANCE APPRAISAL SYSTEM IN VSP/RINL
TABLE NO. 4.12
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Performance and Potential appraisal |11 |18.3 |
|2. |Team appraisal |4 |6.8 |
|3. |Self appraisal |35 |58.3 |
|4. |360 degree appraisal |10 |16.6 |
| |TOTAL |60 |100 |
1 The above table No. 4.12 explains about the best performance appraisal in Visakhapatnam Steel Plant according to employees are agreed with self appraisal (58.3%) 360 degree appraisal (16.6%) Performance and potential appraisal (18.3 %) and team appraisal (6.8 %). As per my survey, I observe that the employees in VSP/RINL are genuine to assess their performance on their own.
PYRAMID DIAGRAM: 4.12
[pic]
MANAGERS CAN GET WORK OUT OF EMPLOYEES WITHOUT PERFORMANCE APPRAISAL SYSTEM:
TABLE NO.4.13
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |0 |0 |
|2. |Disagree |22 |36.6 |
|3. |Agree |33 |55 |
|4. |Strongly Agree |5 |8.4 |
| |TOTAL |60 |100 |
The above Table No.4.13 shows that the majority of respondents (55% %) express agree, and remaining respondents (36.6%) are disagree to the statement. By these methods, the managers can motivate the employees to work done. So most of the employees can accept this technique in their job career.
CYLENDER DIAGRAM: 4.13
[pic]
AWARENESS PROGRAMMES REGARDING PERFORMANCE APPRAISAL SYSTEM SHOULD BE CONDUCTED PERIODICALLY:
TABLE NO.4.14
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |0 |0 |
|2. |Disagree |5 |8.3 |
|3. |Agree |51 |85 |
|4. |Strongly Agree |4 |6.7 |
| |TOTAL |60 |100 |
The above table No.4.14 agree by (85%) respondents and (6.7%) employees are strongly agree the statement i.e. awareness programmes are conducted periodically. In VSP, awareness programmes regarding performance are take place twice in a year.
LINE DIAGRAM: 4.14
[pic]
PEOPLE HAVE AN OPPORTUNITY TO PARTICIPATE IN THEIR APPRAISAL IN THE ORGANISATION:
TABLE NO.4.15
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Yes |30 |50 |
|2. |No |6 |10 |
|3. |Partially |24 |40 |
|4. |TOTAL |60 |100 |
The above table No.4.15 shows that the majority of (50%) respondents say yes to the above statement. (40% ) say partially and (10%) expressed No to the given statement. So, most of the employees are participate in the appraisal system.
CONE DIAGRAM: 4.15
[pic]
SUPERIORS IN THIS ORGANISATION GIVE FEEDBACK TO THEIR SUBORDINATES WITH ADEQUATE CARE AND CONCERN.
TABLE NO.4.16
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |5 |8.3 |
|2. |Disagree |14 |23.3 |
|3. |Agree |38 |63.4 |
|4. |Strongly Agree |3 |5 |
| |TOTAL |60 |100 |
The above table No.4.15 shows that (63.4 %) respondents agree with the statement (5% ) strongly agree and remaining (23.3 %) respondents disagree to the statement superiors give feedback to their subordinates with adequate care and concern.
CYLENDER DIAGRAM: 4.16
[pic]
PERFORMANCE APPRAISAL SYSTEM FORMS PROPER BASIS FOR MAKING DECISIONS REGARDING PROMOTIONS AND REWARDS SYSTEM:
TABLE NO.4.17
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Strongly disagree |0 |0 |
|2. |Disagree |21 |35 |
|3. |Agree |39 |65 |
|4. |Strongly Agree |0 |0 |
| |TOTAL |60 |100 |
The above table No.4.17 fully explains about whether the performance appraisal system forms proper basis for making decisions regarding promotions and rewards system in among employees (65 %) agree.
DOUGHNUT DIAGRAM: 4.17
[pic]
VISAKHAPATNAM STEEL PLANT/RINL GO BY MERIT (OR) SENIORITY WITH RESPECT TO PROMOTIONS
TABLE NO.4.18
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |By Merit |0 |0 |
|2. |By Seniority |32 |53.4 |
|3. |By Both |28 |46.6 |
|4. |None |0 |0 |
| |TOTAL |60 |100 |
The table No.4.17 explains about whether Visakhapatnam Steel Plant gives promotions by Merit or Seniority. (53.4%) respondents say that by both Merit and Seniority (46.6%) respondents by Merit ( ) respondents by seniority. VSP gives promotion on the basis of merit and seniority.
BAR DIAGRAM: 4.18
[pic]
PERFORMANCE APPRAISAL SYSTEM EFFECTS ON THE ORGANSIATION DEVELOPMENT:
TABLE NO.4.19
|Sl.NO. |RATING |RESPONDENTS |PERCENTAGE |
|1. |Yes |28 |46.6 |
|2. |No |8 |13.4 |
|3. |Partially |24 |40 |
| |TOTAL |60 |100 |
This Table No.4.19 represents performance appraisal system effects on the organization development (46.6 %) of the employees say that Yes (13.4%) say No and (40%) say partially for this question. By this response we can assess that it effects the organizational development.
CONE DIAGRAM 4.19
[pic]
CHAPTER-V
SUGGESTIONS, SUMMARY AND CONCLUSIONS
SUGGESTIONS:
Samples of 60 responds, selected at random from JO to middle level management from different departments were sought for their opinions on the existing appraisal system.
A survey was conducted (by way of questionnaire and discussion) to find out whether the employees are satisfied with the existing system and their opinions on related areas.
SUGGESTIONS FOR A BETTER PERFORMANCE APPRAISAL SYSTEM:
• For improvement of the performer the appraisal can be conducted quarterly so that better results can be achieved
• For better results, Appraisal system should be connected to incentive scheme.
• As the appraisal is directly linked to promotion or career progression of an employee, there should be transparency in discussing the appraisal report.
• Objective and fair assessment can induce seriousness towards appraisal and help increase motivation among employees.
• It should be ensured that employees take appraisal system seriously. To achieve this, they should be given proper awareness on appraisal system. (Especially for new comers and internally promoted employees).
• If areas of improvement are linked with present year tasks, then we may get better results.
o For example, tasks in blast furnace department can be segregated into three categories, like
▪ productive tasks,
▪ safety tasks &
▪ Job related tasks.
o Under each category again 5 points should be there. Each employee is required to fulfill at least 3 points in each category.
• Discussion between the appraiser and appraise regarding the appraisal should be transparent and open.
• Appraisal system should be made online so that it will be transparent and punctual.
REASONS WHY PERFORMANCE APPRAISAL DOES NOT FORM A PROPER BASIS FOR DECISIONS REGARDING PROMOTIONS:
• Biased evaluation is not a proper indication of an employee’s performance standards.
• Lack of awareness of appraises, regarding the appraisal techniques and in dealing with post appraisal tools like counseling.
• Reliance on seniority rather than on performance.
• Manipulations, impression, ideas and deludes can damage the credibility of the appraisal.
SELF APPRAISAL AS THE BEST FORM OF EVALUATION OF ONE’S PERFORMANCE:
This refers to the evaluation that the employee makes of himself, generally. The employee and the supervisor discuss their perceived differences here. The aim is not only to assess the appraise, but also to encourage his development, to build teamwork and to link his job performance with organisation’s goals.
Self-appraisal can be very effective, as it provides the employee with an opportunity to participate in the appraisal process and set performance targets for himself. Numbers of organisations encourage discussions regarding differences in subjective rating between the employee and the supervisor so as to ensure active involvement from both sides.
SUMMARY:
The “Quality” revolution has changed the way in which many organisations operate. With global competition, the drive to provide better quality and to satisfy external and internal customers has been activated. In Visakhapatnam Steel Plant, an attempt was made to integrate this though Performance Appraisal System.
Visakhapatnam Steel Plant executive Performance Appraisal System mainly aims at “Result Oriented Executives”. To bring this about, many activities are to be initiated, like Performance based recognition, competencies to handle future/current jobs, career growth etc and PAS designed to provide the key inputs that all the above need to be achieved.
Their system of appraisal in the first instance looked “fool-proof” and well designed to suit the quality generation, for it has integrated in itself some wonderful concepts. But, when this study is completed the result/conclusions showed that the employees, who actually are participants in the system, do feel that this system is not very effective. Surprised by this result, an attempt was made to analyse the REASONS FOR DISSATISFACTION of executives with their performance appraisal system. They are:
1. Mostly this system is not helping the person to assess his capabilities the assessment is mostly dependent upon the obedience with his boss.
2. Self-assessment does not carry enough weight age. So, the drive to sincerely appraise ones own self is lacking.
3. Potential review is integrated in the PAS. But, potential being the capability to take up the future job cannot be judged by the performance on the present job.
4. Training needs identified either through self assessment or team assessment are consolidated and only a few of them are finalised after several rounds of filtering. This indirectly results in deputing for training programmes which are not relevant to the appraise and only an eye wash technique.
5. The employees are assessed by a team of appraisers, who are their superiors. The problem here is that, the team of appraisers who do not have regular interaction with the appraise, may give a rating which can be mostly subjective.
6. Tasks and targets do not reflect the efficiency of executing them.
7. Absence of a proper reward and punishment system.
8. Lack of time spent by the appraiser and apprise during the performance review.
9. A good number of employees are not satisfied with the ceiling prescribed for distribution in an appraisal group.
10. Employees feel that filling the appraisal form is a routine job, and the procedure and method should keep on changing from time to time.
11. While going through the analysis it seems that a good number of people are uncertain about each question asked to them which clearly shows that there might be some fault existing in the system which could be explored and overcome. However, none of the above reasons identified are so damaging that they cannot overcome. With slight changes in appraisal format and rating pattern the problems would be mostly solved and a better Performance Appraisal System can be evolved.
CONCLUSION
VIZAG STEEL - YESTERDAY, TODAY AND TOMMORROW
YESTERDAY
The momentous decision to establish a Steel Plant at Visakhapatnam was announced in the Parliament in 1970 by the then Prime Minister, Smt. Indira Gandhi. The foundation stone for this massive project was laid in 1971. The Detailed Project Report was prepared in 1977. However, it was only in 1979 with the Government of erstwhile Soviet Union offering techno-economic cooperation, the cabinet approved the proposal for setting up of an integrated Steel Plant at Visakhapatnam.
The 7 M tall Coke Ovens with Dry Quenching facility, the 3,200 cum Blast Furnaces and the 100% Bloom Casting technology and fully computerized Rolling Mills are only some of the unique features of VSP's most modern assembly of global technologies.
However, the journey of Vizag Steel has not been very smooth. 22 long years between conception and commissioning resulted in an increase of project cost to over Rs. 8,500 Crores. The implication of this was very high interest and depreciation charges, resulting in accumulated loss of Rs. 2,033 Crores even before start of the operations.
Distant raw material linkages coupled with lack of captive mines for major raw materials, have resulted in high raw material costs too.
Also, by the time the plant started its full-fledged operation, it had to operate in the decontrolled regime of iron & steel. After a short period of operations, tumultuous times were experienced due to internal technological problems like the coke oven set back.
All these problems led VSP to its nadir point - it's reporting to BIFR. After that, the plant has exhibited dramatic turn around and has been making profits continuously for the past 4 years.
TODAY
RINL, in spite of operating at 120% of its rated capacity, registered 2% growth in saleable steel production and the total sales have been improved by 4%. The Organization has become net positive in 2008-09, having wiped out all accumulated losses and registered Rs.1251 Crores net profit after taxes. The efforts have been duly recognized both by the Government and the society and a number of accolades have been bestowed, significant among them being the National Energy Conservation Award for the 6th time in concession, the National Award for Excellence in "Water Management, the National Award for Excellence in Cost Management, the QCFI Award and the Viswakarma Puraskars.
TOMMORROW
In line with the vision in National Steel Policy envisaging 110 MT steel by 2019-20, Vizag Steel is also planning to expand its capacity. Considering the buoyancy in domestic steel market for long products, which is the product mix of VSP and the high acceptance of VSP's brand image in the market, an expansion plan has been proposed. The expansion plan of doubling the capacity of the plant has been cleared in a record time of 10 months and the entire Vizag Steel collective is totally geared up for completing the expansion in the stipulated 36 months. The consultant is in place and the funds are in hand. The expansion should give a strong footing for VSP's growth.
The expansion program is progressing well as per plans and the present focus is on creating an enabling infrastructure such as roads, water, power etc., for smooth execution. Also thrust is on finalization of the specifications and placement of orders. To leverage from our brand leadership in the long segment category, expansion has been cast to enhance volumes in the long product category. A seamless tube mill is also been envisaged to reduce the dependence on imports in view of the huge requirement by the oil and gas sector.
BIBLIOGRAPHY
K.K.Ahuja’s “HUMAN RESOURCE MANAGEMENT”, Kalyani Publishers.
ARUN MONAPPA and MIRZA’s “PERSONNEL MANAGEMENT’, Tata Mc Graw-Hill.
ASWATHAPPA’s “HUMAN RESOURCE AND PERSONNEL MANAGEMENT” Tata Mc Graw-Hill.
P.SUBBA RAO’s “HUMAN RESOURCE MANAGEMENT AND INDUSTRIAL RELATIONS”, Himalaya Publishing House.
V S P RAO and P.S.NARAYANA “MANAGEMENT”, Premier Book Company, New Delhi.
Locher, A.H.& Teel, K.S.(1977) Performance appraisal – a survey of current practices, Personnel Journal, Vol.56 No.5 p. 245-257.
Magazines and Periodicals
In House Magazines of Visakhapatnam Steel Plant.
Records & Statistics complied by Personnel/Central Employee Relations Section of Visakhapatnam Steel Plant.
ANNEXURE
Below statements have been framed basing on a rating scale, using the code given below each statement, please tick your choice (()
|1. |Happy being associated with VSP? |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|2. |Is there performance appraisal system in RINL/VSP? |
| | |
| |1) YES 2) NO |
|3. |Employee opinion on present performance appraisal system in VSP? |
| |1) Excellent 2) Good 3) Moderate 4) Bad |
|4. |Performance appraisal system helps in assessing competency. |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|5. |Performance appraisal creates an effective work environment and positive relationships. |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|6. |Performance Appraisal system helps to know the strength and weakness of the subordinates. |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|7. |Low performance is due to lack of skill. |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|8. |Performance Appraisal helps in assessing the training needs of the subordinate. |
| |1) Yes 2) No 3) Sometimes |
|9. |Performance Appraisal system encourage people to plan their work well in advance. |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|10. |The objectives of performance appraisal system are clearly spelt out. |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|11. |Best person to conduct performance appraisal system. |
| |1) Superiors 2)Sub-ordinates 3) Peers 4) HOD |
|12. |Best performance appraisal system in VSP. |
| |1) Performance and Potential Appraisal 2) Team Appraisal |
| |3) Self-appraisal 4) 360o Appraisal |
| | |
|13. |Managers can get work out of employees without performance appraisal system. |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|14. |Awareness Programmes regarding Performance Appraisal system should be conducted periodically. |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|15. |People have an opportunity to participate in their appraisal in the organization. |
| |1) Yes 2) No 3)Partially |
|16. |Superiors in this organization give feed back to their subordinates with adequate care and concern. |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|17. |Performance Appraisal System forms proper basis for making decisions regarding promotions and rewards system. |
| |1) Strongly disagree 2) disagree 3) agree 4) Strongly agree |
|18. |VSP/RINL goes by merit or by seniority with respect to promotions. |
| |1) By Merit 2) By Seniority 3) Both 4) None |
|19. |Performance Appraisal System effects on the organization’s development. |
| |1) Yes 2) No 3)Partially |
| | |
|20. |According to you are there any shortcomings in the present performance Appraisal System in Visakhapatnam Steel Plant? If, |
| |yes what are they? |
| | |
| |a) |
| | |
| |b) |
|21 |What suggestions do you make to improve the present performance appraisal system in Visakhapatnam Steel Plant? |
| | |
| |a) |
| | |
| |b) |
Signature:
Date:
|Name |Designation |Emp.No. |Department |
Data provided here is not absolute …its only for reference
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