Performance Appraisal in Vadilal

INDEX
Part-1
Overview Of Organization
Company Profile
Vision/Mission
History
Divisions
Group companies & Directors
Organization Hierarchy
Department of Vadilal
HR Department at Vadilal
Part-2
Performance Appraisal
Definition & Concepts

Modern Appraisal
Objective of Appraisal
Feedback of Appraisal
Performance Review
Active Conversation
Employee &Organization
viewpoint
Reward Issue
Bias Effects
Part-3
Introduction
Traditional Methods
Modern Methods
Objective
About my work
Performance Appraisal Form
Conclusion
Recommendations
Bibliography
Overview
Of
Organization
Company Profile
Name: Vadilal Industries Limited.
Corporate Office: VADILAL HOUSE

Nr. Navrangpura Railway Crossing
Navrangpura, Ahmedabad-380006
Size of Unit: Large-scale Unit
Establishment Year: 1926
Factory Locations: Dudheswar,Ahmedabad, Dharampur,Valsad
Annual Turnover: Rs.250 crores.
Divisions: Ice-cream
Processed Food
Real Estate
Chemicals
Forex
Market share in India: 25%
Market share in Gujarat: 60%
Number of Products: More than 200 Products
Total Production: 10,000 Liter/Day
Punch Lines:
Ice-Cream:
The Ice-cream Experts
The Cream of India
Processed Food:
Pure Vegetarian
Vision / Mission
To become an Indian MNC in frozen foods.
To provide products and services at an affordable price without

compromising the quality, says Shri Ramchandrabhai Gandhi
History
Today, the name Vadilal conjures images of lip-smacking ice cream in

a whole gamut of flavors. Vadilal spells quality, availability, variety and
state-of-the-art machinery and equipment. It has, however, been a long
journey for the group, which traces its origins way back to 1907, when a
certain unassuming gentleman, by the name of Vadilal Gandhi, the great-
grand father of Virendra R Gandhi, Rajesh R Gandhi and Devanshu L
Gandhi, started a soda fountain. He passed on the business to his son,
Ranchod Lal, who ran a one-man show, and, with a hand cranked
machine, started a small retail outlet in 1926.
Eventually, Ranchod Lal's sons, Ramchandra and Lakshman, inherited the

business and they were instrumental in giving a new direction to the
company. The duo imparted a new vision to the venture and infused a
spirit of calculated risk-taking into the company. As a result, by the
1970s, the Vadilal Company had already evolved into a modern corporate
entity.
In 1972-73, the company had 8-10 outlets in Ahmedabad. Gradually, we

moved from the city to other parts of Gujarat. By 1985, the company
moved towards neighboring states like Rajasthan and Madhya Pradesh.
But the expansion was undertaken very methodically and we spent five to
six years in spreading our business and then consolidating it" says Shri
Ramchandrabhai Gandhi (Chairman).
In 1997 Vadilal was converted from Private Limited to Public Limited

company. It is listed on Mumbai & Ahmedabad Stock Exchange.
Vadilal Group has Head Quarter in Gujarat (Ahmedabad), the most

industrialized State in India. The Group has a turnover exceeding Rs.250
crores. Major Companies of the Group are listed in several Stock
Exchanges of India like Mumbai & Ahmedabad. The Group has a large
investor base and its brand name "Vadilal" commands an excellent
equity.
P
The "Vadilal" philosophy of providing its customers with quality Products

and services at affordable prices has resulted in the brand being a
household name in India.
Today it is a diversified Business Group with major interests in Ice-

creams, Food Processing, Forex, Real Estate Development.
Vadilal Enterprise Ltd. Is the marketing arm of Vadilal Industries Ltd.

They have the dynamic sales force over 150 sales & marketing
professionals. The company has effected changes in its organizational
structure & training inputs from time to time, in order to influence a
competitive spirit amongst sales amongst peers and build a consolidate
force of live-wire professionals.
Vadilal has stood the challenge of time & held its own in India even in
the presence of global giants.
Ice-cream Division
Vadilal has a wide range of products in both Ice Cream and Processed
Foods.
Company has varieties in Bulks, Party Packs, Family Packs, Cones,

Premium Cups, and Candies etc.
Happinezz parlous serve the customers with most of the items mentioned
above and also make innovative changes in the presentation of the
various flavors.
Also do special caterings orders for parties, marriages, any function etc.
> One of the largest Ice-cream manufacturers of India

> Production Capacity 1,40,000 Liters/Day
> Product Matrix of over 200 SKUs
> A fleet of 115 refrigerated vehicles
> Exclusive Ice Cream boutiques known as Happinezz
> Largest cold chain in India
> 25 stock points all across the country
Processed Food Division

Varieties in Frozen Paratha, Samosa and other Asian Snacks, Frozen
Ready to Eat Indian Curries and Ready Meals, Frozen Condiments e.g.
Ginger, Garlic, Mint, Coriander etc
Canned Foods Canned Tropical fruit pulps and slices, Canned Tropical
vegetables, Canned Tropical fruit juices, Canned Ready to Eat Indian
Curries etc.
Cones & Biscuits we have gone for backward integration and we have a
division, which caters to only our internal requirements of wafer
biscuits, cones for ice cream, partial packing material etc.
> Entered Horticultural Processing Industry in May 1991
> Commissioned an ultra modern facility at Gujarat, India
> Processes and markets a wide variety of fruits, vegetables and Ready-
To-Serve (RTS) Indian Curries, Snacks & deserts
> Manufacturing capacity of 5,400 Tons per annum for canned products
and 12,000 Tons per annum for frozen products.
> About 80% of produced is exported to Europe, USA, Canada, Middle

East & Asia Pacific. Present in more than 45 countries worldwide
Forex Division
Forex is a dynamic division of Vadilal Group since 1996.
Caters complete Forex advisory services to Groups, in areas of RBI

directives, FEMA Regulations etc.
BULLION Informative service of Gold, Silver, and Precious metals on

International trading, quotes, rates, forwards, futures, etc.
LME-METAL Informative service of most base metal quotes at LME,

COMEX, NYMEX, Shanghai, markets, and complete guide and informative
service on forward, futures and relative data. Highly professional &
experienced personals keep an constant watch on the market trend &
update www.vadilalmarkets.com.
Real Estate
> Vadilal Group ventured into real estate & constructions in 1994.
> Focused on timely completion of projects undertaken.
> Assuring sound construction using best raw materials.
> Has developed unique corporate complexes, comfort & convenience as

major facility in strategic locations.
> Developing residential bungalows schemes amidst of nature offering a

life style of dreams & amenity.
Chemicals
Vadilal Chemicals is a multi location & multi product company of Vadilal

Group.
Manufacturing Industrial & specialty gases, petroleum products since

1970.
Caters to over 2500 industrial customers in India.
Assuring consistent purity, quality & stability through extensive cylinder

preparation /preconditioning, dedication by gas service and statistical
quality control.
Specialty in tailor made mixtures to meet the essential requirement of

Industrial customers.
Group Companies & Directors
GROUP COMPANIES
Vadilal Group has many companies under its banner, the

following list includes the major companies and is not the
full consolidated list:
1 Vadilal Industries Ltd.
2 Vadilal Enterprises Ltd.
3 Vadilal International Pvt. Ltd.
4 Kalpit Realities and Services Ltd.
Vadilal Industries Ltd. (VIL)
This is the Manufacturing Company of the group. It has FOUR

manufacturing facilities all over India.
Vadilal Enterprises Ltd. (VEL)
This is the Marketing Company of the group.
Vadilal International Pvt. Ltd. (VIPL)
This company owns the Trade Mark and other Brands for the
Group, irrespective of Ice Cream or Processed Foods Business.
Kalpit Realities and Services Ltd. (KRSL)
This is the company which is into Real Estate and Transportation

business.
Directors of only VIL
Mr. Ramchandra Gandhi- Chairman
Mr. Rajesh Gandhi Managing Director

Mr. Devanshu Gandhi Managing Director
Organization Hierarchy
The Organization structure in the group is comparatively flat. There
are not more than three levels of reporting for the junior most
employees in the staff cadre. The employees are bifurcated into
various categories (grades) based on their qualification, experience,
nature of association with the organization etc.
The employees are divided as follows: Senior Management, Middle

Management, Junior Management and Workers
Category Names and Corresponding Titles
MD: Managing Director
UC: President/ Vice President/ General Manager
M1: Dy. General Manager/ Sr. Manager
M2: Manager/ Regional Sales Manager
M3: Dy. Manager / Dy. Regional Sales Manager
M4: Asst. Manager/ Area Sales Manager
M5: Executives/ Sr. Executive
M6: Jr. Officer/Officer/Sr. Officer/Supervisor/Sr. Supervisor/Junior

Sales Exe.
M7: Assistant/ Jr. Supervisor / Sales Representatives
M8: Clerks/ Parlous Boy
Operators
Different Department
There are various departments in the organization, which
perform different functions. There are departments like
Production, Engineering, Quality Assurance, Marketing etc.
The list mentioned below only comprises of the departments
where as an employee you will have some interaction:
1. P & A Department: This is among the first point of contact for any
employee in the organization. The employee can contact this
department for any query related to his attendance, salary, leaves,
confirmation, appraisal, exit procedures, local traveling etc. The P & A
dept. will be the coordinator between the employee and all other
departments.
2. HR Department: This department can be approached if your

queries are not solved by the P & A dept. but the queries need to be
genuine.
3. Accounts Department: This department gives the employees the

cash or cheque for the various vouchers which the employee keeps for
claiming the money which he spends for Companys work.
4. Insurance Department: In case of any accident or illness the

employee will be helped by this department.
5. Taxation Department: For all his Income Tax related queries for
himself the employee should contact this department in consultation
with the P & A dept.
6. Library Department: This is the department where you can

approach for taking a book or any learning material.
7. Purchase Department: Usually the employee will be provided with
regular stationary in his own department itself but if he needs
anything else then he can fill the requisition slip in the inventory
management system or ask someone from his department to do the
same and take the HODs approval and get the stationary from the
purchase department.
8. MIS Department: For every expense the employee makes for the
company there has to be sufficient budget so that the employee can
claim the expense later on. The employee should first see in his own
Vadilal ERP and if some changes need to be done then he can
approach the MIS department through his HOD.
9. System Department: This department will give every employee

with an individual login id for Vadilal ERP.
10. Catering Department: If any employee is approached by his

friend / relative for purchasing Ice-Cream, Processed Foods or any
other services which we offer then the employee should contact the
Catering department or the relevant business division. All employees
should never miss a business lead opportunity.
Human Resources
We believe that investment in human capital is of utmost importance
in order to achieve and sustain growth.
The HR team at Vadilal Group believes that there is immense potential

in every individual and that every individual would always want to
achieve the best for himself and his family. The HR team also believes
that success can never be achieved by being self centric but can only
be achieved by aligning ones personal goals with the Organizations
Goals.
For aligning ones personal goals with the Organizations goals the
individual may do the following:
1. Always keep the Organizations Goal and Values in mind.
2 Always have a goal for yourself and see that your goal is helping the
organization also in moving ahead
3. Perform ones individual task to ones fullest ability
4. Give ones full contribution to the team task
The HR team along with other related departments tries to give Va

Delights the conducive environment to work in, challenging
Assignments to prove oneself, differential remuneration to achieve end
results and training and development to perform better.
HR Philosophy
Vadilal Group has a progressive and a dynamic Human Resource (HR)

philosophy. We understand that Human Resource Management is
concerned with integrating people into a work environment, motivating
them to work together effectively and providing them social,
psychological and financial satisfaction this is what we exactly try to
do.
We believe in transforming our human capital into a key source of

competitive advantage because we understand its value when tough
competition is ruling the market scenario. Our strong value system is
driven by result orientation, adaptability to change, humility and
respect for subordinates and peers.
Employee Oriented HR Practices
HR practices in Vadilal are aimed at bringing out the best in the

employees. There is a well defined Induction Programme at Vadilal
which is aimed at orienting the new employee to the group.
Performance Management System at Vadilal is of great importance
because it enables us to identify the performers, give them feedback
on their performance and plan for the future role of the employee. T&
D enables the employees to hone their skills, think out of box, develop
the initiatives, adopt a pro-active approach, become more
productive and have a well-defined career path which is in line with
the overall organizational objectives. Feed back from Exit Interviews is
used for constant improvements.
Culture
Organizational Culture is the easiest thing to comprehend and at the

same time the most difficult thing to define. This is because of the
aura of mystique that surrounds Organizational Culture.
Development
Skilled Human Capital is critical for the growth of any organization. We
believe in adding value to s human capital through various HR
practices that co-exist in unison with each other. Performance reviews,
training workshops are some of the tools that aid in nurturing the
human capital.
Quality
Quality is an integral part of the companys well-defined and dynamic
HR policies and practices. The entire processes, development,
achievement, performance evaluation and appraisals are driven by
quality of output and result orientation.
Work-Life
We believe in work life balance and hence we have flexible working
hours at Corporate Office. This keeps our employees happy and we are
able to achieve greater efficiency and effectiveness.
Open Door
we have an open door management policy so that our employees are
always free to discuss the problems they face and the management
can always extend a helping hand to sort out
HR Department of Vadilal:
Groups Vision, Mission, Values
VISION
This would be achieved by satisfying the all the stakeholders like many
employees, vendors, shareholders etc. This would be achieved by
having World Class quality standards, manufacturing practices,
information systems and competent employees.
MISSION
To provide quality products and services at an affordable

price.
VALUES
1 Customer Focused: The group is focused in satisfying the customer

needs and is always working towards delighting and giving the
customer new value added services.
2 Performance Driven: The group gives opportunities to learn and

grow with the group. Team performance and individual performance
both are given equal importance.
3 Business Ethics: Highest standards of Business ethics should be

maintained in order to achieve our vision.
4 Team Work: Here team work means coming out of individual

functionalities, co-operating with all, bringing in zeal to perform well in
all related to us and opposing any wrong doing or underperformance.
5 Mutual Respect: The group believes in the concept of mutual respect

which is to be considered for all levels of employees, customers,
shareholders etc.
Recruitment
Recruitment is the process of seeking & attracting the right kind
of people to apply for a job in the organization.
Generally advertisement given into various newspapers for

employment .When job applicant come he/she would fill up
companys own Employment Form to synchronize & arrange the
data into one fixed format. There will be panel of three
interviewerss who examined the ability & various aspects of his
personality according to the job profile.
There is an Interview Evaluation Form given to main member of

panel to evaluate & rank the applicant according to various
parameters. If applicant is selected salary & other formalities like
joining date & other are noted down on this form.
Joining Formalities
Whenever the new employee joins the organization, he has to bring
along all the required documents; a list for this is already given to him
along with offer letter. He should get in touch with the P & A dept. and
submit completed forms or self attested photocopies of the selected
documents.
List of forms or documents to be brought at time of joining:
1. Relieving letter from your last employer.

2. Salary certificate from your last employer.
3. Experience certificate from last employer and all past employers.
4. Medical fitness certificate and blood group from a MBBS Doctor.
5. Copies of all education testimonials (Starting form 10th
standard)
6. School leaving certificate
7. Three Passport size Photographs
8. Completely filled PF nomination or PF transfer form.
9. Completely filled ESIC nomination form.(if your gross is less than
Rs. 10000 pm then you have to fill this form).
10. Bank account opening form
List of activities after Joining
List of activities to be done by the employee after joining:
Get a unique User Id for Vadilal System (our internal ERP). This will be
provided to the employee on the recommendation of the HOD.
Unique User id for Vadilal System, the password for this should not
be shared to anyone. This is for your own safety.
Get an official Email ID, if your HOD feels the need for it.
Fill an Employment details form for the companys records.
Confirmation
The initial confirmation meeting should be within 15 days of
completion of three months from the date of joining. In this meeting
the performance feedback should be given to the employee and after
six months he should be confirmed. You are not confirmed until you
are informed in writing about this.
Remuneration
Work Schedule
We are present a various locations and the work schedule is different
for different locations. The work schedule is based on the needs of the
location and the rules governing that particular location.
The work schedule at the corporate office is from 9.15 am to 6.30 pm

and the lunch break is from 1.00 to 1.30 pm. The Corporate Office has
holidays on 2nd and 4th Saturdays of the month.
The work schedule at the Manufacturing Facilities is based on shifts

and its details are available with Local P & A depts.
Employee Number
Every employee shall be given a Employee Number. The employee

should remember this and should always mention this in any
communication with P & A and HR dept.
Attendance
Every employee is informed how his attendance is to be maintained in

the company.
Every Employee is given a punching card. The employee should punch

this card whenever he enters or leaves the premises of his work place.
If the employee has Vadilal User ID then he can see his attendance
and submit the relevant reports to the P & A dept.
Gate Pass
If during duty hours, you are going outside for official/personal work,
you are required to obtain Gate Pass from your HOD which is to be
handed over at the main gate before leaving the premises.
Paid Holidays
The list of paid holidays is circulated to all in the month of December

every year. Notices specifying the days observed by the companies as
Holidays and Pay days are posted on the notice boards.
Leave & Absence

Leave eligibility would be governed the rules and regulations governing
the different companies. An informative table below mentions the
different eligibility for the leaves.
In case of emergency or if you are sick and unable to come to work,

then please make sure that you inform your HOD about it. In normal
circumstances the leaves should be preplanned. All your leave
applications in the prescribed form should be submitted to P & A dept.
in time. Prescribed forms are available with P & A Office. It is the
employees responsibility to clear his attendance regularly and not wait
till the final day of salary calculation.
Payment of Salaries
The bank opening form given to you at the time of joining

Should be properly filled and returned to the P & A dept.
Once the P & A dept. receive this form the further procedure is done.
When your account opens please give the P & A dept. your account
number. Your salary will be directly deposited in your bank account.
Please collect the Pay slips from the P&A dept. Only for the first month
of joining as your account is not open in the bank you will get salary
through cheque. Employees should not disclose personal remuneration
details to anybody.
Reimbursements
The reimbursements are given through separate modes of payment.
Medical Reimbursement
For claiming this medical reimbursement under tax rebate clause you
will have to produce medical bills. These medical bills can be of any
expense incurred for medical treatment and is to be submitted with a
forwarding application.
Leave Travel Assistance (LTA)/Leave Travel Concession (LTC)

LTA/LTC is part of the salary package. The difference between LTA/LTC
is that LTC can be used for claiming benefits under Income Tax act.
LTA/LTC is not given to employees whose salary is below Rs.100000

per annum. LTA/ LTC is given as per the grade of the employee & also
his salary level.
LTA/LTC can only be claimed after completion of one year of
service. If an employee leaves the organization within one of
year then the LTA/LTC amount will not be given to him/her.
For employees in grade M6 and below the LTA will be given in the
salary directly. For employees in grade M5 and above can claim it by
filling a form in the month of December. For claiming LTC it is
compulsory to have 4 days of PL as leave.
Employees can claim advance of LTA/LTC in the month of July every

year. Form for this can be taken from P & A dept.
WELFARE & OTHER ACTIVITIES
TOUR AND TRAVEL/LOCAL CONVEYANCE

The P & A dept. of the respective locations have the travel
policy and you can take guidance from them if you have to
go on a official tour. The travel policy will guide you on the
mode of transport, category of cities and other relevant
details required for traveling.
Employee who goes on official tour should submit a tour

form to the P & A dept. and also keep in mind that all his
attendance and leaves are properly in place so P & A can
make the salary without any confusion. The employee on returning
back can fill the Tour & Travel Expense form and claim the expenses.
Local Conveyance
If employee for official work has to move in and around the
City then he can claim the conveyance rates as mentioned
below.
Two Wheeler rate: Rs. 2.15 per km
Insurance
As a Company all care is being taken to INSURE the

employees and cover their risks of getting injured while on
duties. Even the casualties have also been taken care. The
coverage has been taken by doing the Risk Management.
Induction
NEEP (NEW EMPLOYEE EFFECTIVENESS PROGRAMME)
Every new entrant to Vadilal Group is taken through a Planned

Induction Programme. This gives a jump-start to the employees
association with the company. This induction programme is named
NEEP.
The programme is divided into two parts
1) Individual Orientation Part
2) Group Orientation part
1. Individual Orientation Part:

On Joining the employee is introduced to other employees of Relate
depts. A sheet is prepared by the P & A or HR dept. & the employee is
send to related depts. for the orientation.
The employee is also given this Employee Hand Book for

Reference.
2. Group Orientation Part:

The new employees are called for a Group Orientation part
every month. This programme gives a broader view to the new
employees about the group and the future plans of the group.
Exit Procedures
If someone decides to leave the organization then you have to
compulsory fill an exit interview form. This is to get employees
feedback and improving the systems.
Once employees resignation is accepted the clearance sheet is

circulated to all relevant depts. Once it is done the Full and Final
Calculation is done and cheque is send to that person.
About
Performanc
e
Appraisal
Definition & Concepts
The history of performance appraisal is quite brief. Its roots in the

early 20th century can be traced to Taylor's pioneering Time and
Motion studies. But this is not very helpful, for the same may be said
about almost everything in the field of modern human resources
management.
As a distinct and formal management procedure used in the evaluation

of work performance, appraisal really dates from the time of the
Second World War - not more than 60 years ago.
Performance appraisal systems began as simple methods of income
justification. That is, appraisal was used to decide whether or not the
salary or wage of an individual employee was justified.
The process was firmly linked to material outcomes. If an employee's

performance was found to be less than ideal, a cut in pay would follow.
On the other hand, if their performance was better than the supervisor
expected, a pay rise was in order.
Sometimes this basic system succeeded in getting the results that

were intended; but more often than not, it failed.
For example, early motivational researchers were aware that different

people with roughly equal work abilities could be paid the same
amount of money and yet have quite different levels of motivation and
performance.
These observations were confirmed in empirical studies. Pay rates

were important, yes; but they were not the only element that had an
impact on employee performance. It was found that other issues, such
as morale and self-esteem, could also have a major influence.
As a result, the traditional emphasis on reward outcomes was

progressively rejected. In the 1950s in the United States, the potential
usefulness of appraisal as tool for motivation and development was
gradually recognized. The general model of performance appraisal, as
it is known today, began from that time.
Modern Appraisal
Performance appraisal may be defined as a structured formal

interaction between a subordinate and supervisor, that usually takes
the form of a periodic interview (annual or semi-annual), in which the
work performance of the subordinate is examined and discussed, with
a view to identifying weaknesses and strengths as well as
opportunities for improvement and skills development.
In many organizations - but not all - appraisal results are used, either
directly or indirectly, to help determine reward outcomes. That is, the
appraisal results are used to identify the better performing employees
who should get the majority of available merit pay increases, bonuses,
and promotions.
By the same token, appraisal results are used to identify the poorer
performers who may require some form of counseling, or in extreme
cases, demotion, dismissal or decreases in pay. (Organizations need to
be aware of laws in their country that might restrict their capacity to
dismiss employees or decrease pay.)
Whether this is an appropriate use of performance appraisal - the

assignment and justification of rewards and penalties - is a very
uncertain and contentious matter.
Performance appraisal is the process of obtaining, analyzing and

recording information about the relative worth of an employee. The
focus of the performance appraisal is measuring and improving the
actual performance of the employee and also the future potential of
the employee. Its aim is to measure what an employee does.
It is a powerful tool to calibrate, refine and reward the performance of

the employee. It helps to analyze his achievements and evaluate his
contribution towards the achievements of the overall organizational
goals.
By focusing the attention on performance, performance appraisal goes
to the heart of personnel management and reflects the managements
interest in the progress of the employees.
Objective of Performance appraisal:
To review the performance of the employees over a given period

of time.
To judge the gap between the actual and the desired

performance.
To help the management in exercising organizational control.
Helps to strengthen the relationship and communication between

superior subordinates and management employees.
To diagnose the strengths and weaknesses of the individuals so

as to identify the training and development needs of the future.
To provide feedback to the employees regarding their past

performance.
Provide information to assist in the other personal decisions in

the organization.
Provide clarity of the expectations and responsibilities of the

functions to be performed by the employees.
To judge the effectiveness of the other human resource functions

of the organization such as recruitment, selection, training and
development.
To reduce the grievances of the employees.
How to Measure Employee Performance

The most difficult part of the performance appraisal process is to
accurately and objectively measure the employee performance.
Measuring the performance covers the evaluation of the main tasks
completed and the accomplishments of the employee in a given time
period in comparison with the goals set at the beginning of the period.
Measuring also encompasses the quality of the accomplishments, the
compliance with the desired standards, the costs involved and the time
taken in achieving the results.
Measuring employee performance is the basis of the Performance

appraisal processes and performance management.
Accurate and efficient performance measurement not only forms the
basis of an accurate performance review but also gives way to judging
and measuring employee potential.
For the purpose of measuring employee performance, different input

forms can be used for taking the feedback from the various sources
like the superior, peers, customers, vendors and the employee himself.
All the perspectives thus received should be combined in the
appropriate manner and to get an overall, complete view of the
employees performance. Observation can also be exercised by the
superior to obtain information. Some suggestions and tips for
measuring employee performance are:
Clearly define and develop the employee plans of action

(performance) with their role, duties and responsibilities.
Organizational outcomes or the achievement of organizational

goals should also be kept in mind.
Focus on accomplishments and results rather than on activities.
Also take note of the skills, knowledge and competencies and

behaviors of the employees that help the organization to achieve
its goals.
If possible, collect the feedback about the performance of the

employees through multi-point feedback and self-assessments.
Financial measures like the return on investment, the market

share, the profit generated by the performance of the team
should also be considered.
For an organization to be an effective organization and to achieve its
goals, it is very important to monitor or measure its and its employee
performance on a regular basis. Effective monitoring and measuring
also includes providing timely feedback and reviews to employees for
their work and performance according to the pre-determined goals and
standards and solving the problems faced. Timely recognition of the
accomplishments also motivates the employees and help to improve
theperformance.
Measuring the performance of the employees based only on one or

some factors can provide with inaccurate results and leave a bad
impression on the employees as well as the organization. For example:
By measuring only the activities in employees performance, an
organization might rate most of its employees as outstanding, even
when the organization as a whole might have failed to meet its goals
and objectives. Therefore, a balanced set of measures (commonly
known as balanced scorecard) should be used for measuring the
performance of the employee.
Performance Appraisal Feedback
Performance appraisal process is incomplete without the feedback

given to the employee about his appraisal and his performance. But
the way of giving as well as receiving the feedback differs from person
to person and their way of handling and their outlook towards the
issue. According to a popular saying:
A SUCCESSFUL MAN IS ONE WHO CAN LAY A FIRM FOUNDATION

WITH THE BRICKS OTHERS HAVE THROWN AT HIM.
Therefore, On the part of the person receiving the feedback, the

following points are important to be taken care of:
o The employee should have a positive attitude towards the

feedback process
o He should listen to the suggestions of the appraiser calmly and

try to incorporate them in his plans.
o He should not hesitate to ask for the help of his superiors.
o Should have a co-operative attitude during the feedback

meeting.
o Dont judge the appraiser as a person.
o Should take the feedback objectively.
o Should not judge the appraiser as a person on the basis of the

feedback.
On the part of the appraiser or the manager / person giving the

feedback, the following points are to be taken care of:
o The appraiser should make the receiver feel comfortable during

the feedback meeting.
o The appraiser should make it a two way conversation i.e. let

the employee speak.
o Listen to the employee and note his points, suggestions,

problems etc.
o The appraiser should not adopt a confrontational approach

towards the meeting. The goal is not to criticize the employee.
o Provide a constructive feedback to the employee i.e. in a way

which will motivate him to perform better.
o Have a positive attitude towards the process
o Try to understand the reasons of his failure.
o Be fair and objective
o Prepare yourself for what to say and how to say.
Make the appraisal feedback meeting useful and productive for the
organization and the employee.
Preparation for Performance Review
The performance review meeting should not be strictly formal nor

should it be completely informal in nature. Ideally, the review meeting
should be structured, semi formal meeting which needs prior
preparation by the appraiser as well as the employee for it to be
effective.
Following are some points that need to be prepared before the review
meeting of Performance appraisal:
Inform the concerned employees the date, time and place for
the review meeting well in advance.
Review and be prepared with each and every employees
o Job description
o Performance standards
o Planned performance goals
o Performance measures collected throughout the time

period
o The critical incidents details
o Past appraisals of the employees.

Be ready with all the important dates
Give the employee a copy of the appraisal form
The appraiser needs to completely understand the standards for

the employees at same level to maintain the consistency in the
process.
Prepare what to say and how to say it calmly.

The feedback should be prepared in quantifiable measures where
ever possible.
The appraiser should be familiar with the performance review

form and the details
The employee and the appraiser both should be prepared to

discuss and figure out the future goals and training needs
They should be mentally prepared for constructive feedback
Collect as many evidences to support your point as possible like

the monthly, quarterly progress reports.
Active Performance Appraisal Conversation

Active conversation plays an important part in the performance review
meeting. The appraiser should ensure that the meeting has a two way
conversation and that the employee should get a fair chance to speak.
Some important points that should be taken care of in the appraisal
conversation are:
1. Make it a two-way conversation. An effective Performance

appraisal review requires an interactive discussion with an open
agenda. Try to formulate questions that seek the employees
ideas and input. This will help the employee feel you value his or
her opinions.
2. Be a good listener. Remember to be an active listener and to

pick up on your employees verbal and nonverbal cues. Listen to
his ideas and problems.
3. Address whats important to the employee. Since job

satisfaction is the most important factor affecting an employees
attitude (and therefore his or her level of performance and value
to your company), an effective review should delve into areas
that include issues most important to that employee.
4. Lead with the positive. Its important to reaffirm the

employees strengths at the beginning of the review. Since job
security is the number one concern of most people.
5. Dont be confrontational. Its important not to criticize the
employee in general terms. The goal is to evaluate job
performance and not the person.
6. Positive reinforcement emphasizing what has been done

well so that it will be done even better in the future and making
only constructive criticisms (i.e. those that point the way to
improvement).
7. Exchange of views - Ensuring that the discussion involves a

full, free and frank exchange of views about what has been
achieved, what needs to be done to achieve more and what the
appraiser think about their work the way they are managed and
their aspirations.
8. Agreement - jointly coming to an understanding about what

has to be done by both parties to improve performance,
knowledge and skills and overcome any work problems raised
during the discussion.
Employee Viewpoint
From the employee viewpoint, the purpose of performance appraisal is
four-fold:
(1) Tell me what you want me to do
(2) Tell me how well I have done it
(3) Help me improve my performance
(4) Reward me for doing well.
Organizational viewpoint
From the organization's viewpoint, one of the most important reasons
for having a system of performance appraisal is to establish and
uphold the principle of accountability.
For decades it has been known to researchers that one of the chief
causes of organizational failure is "non-alignment of responsibility and
accountability." Non-alignment occurs where employees are given
responsibilities and duties, but are not held accountable for the way in
which those responsibilities and duties are performed. What typically
happens is that several individuals or work units appear to have
overlapping roles.
Reward Issues
Some interesting insights into what can go seriously wrong in a system

of reward-linked performance appraisal is found in the work of Deets &
Tyler (1986).
The Xerox Experience

The Reprographic Business Group of the Xerox Corporation operated a
very traditional system of performance appraisal based on rating scale
methods. The rating outcomes were linked to pay outcomes. In fact,
the results had direct effects on merit pay rises - everyone at Xerox
knew that and expected it.
The Xerox system included all the common features of rating scale
systems. The appraisal interviews were held annually and conducted
by the employee's immediate supervisor.
Accomplishments of the preceding year were recorded and

performance levels were judged according to various predefined
criteria. The system included some elements of essay appraisal, since
appraisers were required to write brief supporting statements for each
rated criterion.
The Xerox system also called for a summary rating; an ultimate digit,
from a low of 1 (for unsatisfactory) to a high of 5 (exceptional). The
summary rating attempted to encapsulate the whole year's
performance in a single number.
The significance of that final number was immense. It literally

determined the size of the employee's annual pay rise. The higher the
rating, the bigger the rise. For Xerox employees, the thing that really
mattered about appraisal was getting the biggest possible final
number.Analysis of ratings over time showed that more than 95
percent of employees were 3s, 4s or 5s; that is, the spread of ratings
heavily favored the higher end of the scale. Almost every employee,
according to the appraisal system, was performing at or above the
average.
The lower ends of the scale, the ratings of below average and
unsatisfactory were very rarely used. The effect of this distortion was
that any employee who scored less than a 4 ("exceeds expected
performance level") began to feel like a failure!
The appraisal process became a sort of ratings lottery; the aim of the
game was to get the highest possible score and win the jackpot. The
process became fixated on that all-important final digit.
This situation placed tremendous pressure on appraisees and

appraisers alike. The appraisers had the unenviable task of deciding
the winners from the losers. No wonder most of them preferred to
hand out an abundance of overly-generous ratings!
Xerox eventually replaced this system with an MBO/essay form of

appraisal. They abandoned rating scale methods completely.
That may have been an over-reaction, since the fault did not lie with
the method itself so much as with its intimate - and ultimately
inflexible linkage - to the annual pay rise. When reward outcomes are
so closely linked to the size of a rating on a five point scale, the
difference of one point either way can become very important and
provocative.The Xerox rating system might have worked if the direct
causal relationship between the summary rating and merit pay
outcomes had been eliminated or at least softened.
Appraisal Pressure
This kind of appraisal pressure results in a win/lose mentality of the
sort that developed at Xerox. Rather than the appraisee being willing
to openly discuss their performance, they become anxious and
defensive. Naturally, the typical appraisee is not eager to admit to
anything that might impair their chances of a pay rise or other reward.
There is a deep irony in the fact that many organizations, while having
excellent systems of appraisal, allow their merit pay and promotion
decisions to be made by inferior means. Often the matter is left to the
discretion of one or two supervisors or managers, with a cursory
review being made by the HR department.
As well, there is evidence that incongruity between appraisal results
and later pay and promotion outcomes is a source of employee
discontent and de-motivation.
Pay increases and promotions send powerful messages to employees.

If these messages don't match up with the appraisal results,
employees are quick to dismiss the whole process as a farce. Efforts
have been made to convince employees otherwise, but the "bottom
line" for many is who got the extra money or who got the new job.
A Management "Trick"?
The separation of appraisal results and reward outcomes is, at best, a
contrived situation. At worst, it may convey the impression that
appraisal is some sort of deception, a trick by management, designed
to give an appearance of openness and fairness while "real issues" like
pay and promotions are decided in secret.
Nor is the practice of putting a six-month buffer between appraisals

and pay reviews an effective method of avoiding the issue. Far better
to define and clarify the relationship between appraisal, performance
and reward outcomes.
The view of the separatists, which insists that appraisal results and
reward outcomes should be insulated from each other, may be an
over- reaction to the potential abuses.
There is evidence that appraises appreciate the existence of a link

between appraisal and reward results. To many, the existence of such
a link is intuitively sensible.
From the perspective of the organization, the inclusion of carefully

collected appraisal data in pay and promotion matters may contribute
to better quality decisions.
This is a shame, because the potential of performance appraisal

encompasses more than employee development. Admittedly there are
risks in linking reward outcomes; but there are also risks, and a
potential for harm, in contriving to deny that any linkage exists.
At the very least, an organization wishing to form the mildest of

reward links might consider a frank discussion of reward criteria during
the appraisal interview.
Those organizations that are determined to keep their appraisal and
reward issues separated might ask themselves whether performance
appraisal is really the tool they need. Perhaps what they actually
desire is some form of developmental appraisal.
Self-Auditing
According to Krein (1990), appraisers should not confront employees
directly with criticism. Rather, they should aim to let the evidence of
poor performance emerge "naturally" during the course of the
appraisal interview.
This is done by way of open-ended questioning techniques that

encourage the employee to identify their own performance problems.
Instead of blunt statements or accusations, the appraisers should

encourage an employee to talk freely about their own impressions of
their performance. For example, consider the case of employee who
has had too many absent days. The appraiser, in accusatory mode,
might say:
"Your attendance record is unacceptable. You'll have to improve it."
A better way to handle this might be to say:
"Your attendance record shows that you had 7 days off work in 6
months. What can you tell me about this?"
The technique is to calmly present the evidence (resisting the

temptation to label it as good or bad) and then invite the employee to
comment. In many cases, with just a gentle nudge from the appraiser
here and there, an employee with problems will admit that
weaknesses do exist.
This is much more likely when an employee does not feel accused of
anything, nor forced to make admissions that they do not wish to
make.
If an appraiser can get an employee to the stage of voluntary

admission, half the battle is won. The technique described by Krein is a
type of self-auditing, since it encourages the employee to confront
themselves with their own work and performance issues.
The technique is useful because it is more likely to promote discussion
and agreement on the need for change. Confrontation techniques that
rely on "charge and counter-charge" tend to promote adversarialism -
and that leads to denial and resentment.
Common Mistakes
Where performance appraisal fails to work as well as it should, lack of

support from the top levels of management is often cited as a major
contributing reason.
Opposition may be based on political motives, or more simply, on

ignorance or disbelief in the effectiveness of the appraisal process.
It is crucial that top management believe in the value of appraisal and

express their visible commitment to it. Top managers are powerful role
models for other managers and employees.
Those attempting to introduce performance appraisal, or even to

reform an existing system, must be acutely aware of the importance of
political issues and symbolism in the success of such projects.
Fear of Failure
There is a stubborn suspicion among many appraisers that a poor
appraisal result tends to reflect badly upon them also, since they are
usually the employee's supervisor. Many appraisers have a vested
interest in making their subordinates "look good" on paper.
When this problem exists (and it can be found in many organizations),

it may point to a problem in the organization culture. The cause may
be a culture that is intolerant of failure. In other words, appraisers
may fear the possibility of repercussions - both for themselves and the
appraisee.
No matter what safeguards are in place, "... when you turn managers
loose in the real world, they consciously fudge the numbers." What
Longenecker is saying is that appraisers will, for all sorts of reasons,
deliberately distort the evaluations that they give to employees.
Indeed, surveys have shown that not only do many managers admit to
a little fudging, they actually defend it as a tactic necessary for
effective management.
On the other hand, fudging motives can be a lot less admirable and
sometimes devious: the appraiser who fudges to avoid the possibility
of an unpleasant confrontation, the appraiser who fudges to hide
employee difficulties from senior managers, the appraiser who fudges
in order to punish or reward employees.
Feedback-Seeking
Larson (1989) has described a social game played by poor performers.
Many supervisors will recognize the game at once and may have been
its victims.
The game is called feedback-seeking. It occurs where a poor

performing employee regularly seeks informal praise from his or her
supervisor at inappropriate moments.
Often the feedback-seeker will get the praise they want, since they
choose the time and place to ask for it. In effect, they "ambush" the
supervisor by seeking feedback at moments when the supervisor is
unable or unprepared to give them a full and proper answer, or in
settings that are inappropriate for a frank assessment.
The supervisor may feel "put on the spot", but will often provide a few
encouraging words of support. The game seems innocent enough until
appraisal time comes around. Then the supervisor will find that the
employee recalls, with perfect clarity, every casual word of praise ever
spoken!
This places the supervisor in a difficult bind. Either the supervisor lied
when giving the praise, or least, misled the employee into thinking
that their performance was acceptable (in fact, this is the argument
that feedback-seekers will often make).
The aim of the game is that the feedback- seeker wants to deflect
responsibility for their own poor performance. They also seek to
bolster their appraisal rating by bringing in all the "evidence" of casual
praise. Very often the feedback seeker will succeed in making the
supervisor feel at least partly responsible. As a result, their appraisal
result may be upgraded.
Appraiser Preparation
The bane of any performance appraisal system is the appraiser who
wants to "play it by ear". Such attitudes should be actively
discouraged by stressing the importance and technical challenge of
good performance appraisal. Perhaps drawing their attention to the
contents of this web site, for example, may help them to see the
critical issues that must be considered.
Employee Participation
Employees should participate with their supervisors in the creation of
their own performance goals and development plans. Mutual
agreement is a key to success. A plan wherein the employee feels
some degree of ownership is more likely to be accepted than one that
is imposed. This does not mean that employees do not desire guidance
from their supervisor; indeed they very much do.
Performance Management
One of the most common mistakes in the practice of performance
appraisal is to perceive appraisal as an isolated event rather than an
ongoing process.
Employees generally require more feedback, and more frequently,

than can be provided in an annual appraisal. While it may not be
necessary to conduct full appraisal sessions more than once or twice a
year, performance management should be viewed as an ongoing
process.Frequent mini-appraisals and feedback sessions will help
ensure that employees receive the ongoing guidance, support and
encouragement they need.
Of course many supervisors complain they don't have the time to

provide this sort of ongoing feedback. This is hardly likely. What
supervisors really mean when they say this is that the supervision and
development of subordinates is not as high a priority as certain other
tasks.
If appraisal is viewed as an isolated event, it is only natural that

supervisors will come to view their responsibilities in the same way.
Just as worrying, employees may come to see their own effort and
commitment levels as something that needs a bit of a polish up in the
month or two preceding appraisals.
Bias Effects
Gabris & Mitchell have reported a disruptive bias in performance

appraisal known as the Matthew Effect.
It is named after the Matthew of biblical fame who wrote, "To him who
has shall be given, and he shall have abundance: but from him who
does not have, even that which he has shall be taken away."It was
found that when an in grouper did poorly on a task, supervisors
tended to overlook the failure or attribute to causes such as bad luck
or bad timing; when they did well, their success was attributed to
effort and ability.
But when a out grouper performed well, it was rarely attributed to

their effort or ability. And when an out grouper performed poorly,
there was little hesitation it citing the cause as laziness or
incompetence.
It is not clear how supervisors make the distinction between in

groupers and outgroupers. Whatever the criteria, it is clearly not
objective, equitable or reliable.This bias must inevitably lead to a
distortion of the appraisal process. It must also be a source of
frustration for those employees who are discriminated against.
Awareness Training
The first line of defense lies in raising awareness of the problem.
Supervisors need to be informed of the types of subtle bias that can
interfere with their performance as appraisers. They need to
understand that the ingroup/outgroup bias, for instance, reduces the
morale and motivation of their subordinates.
Developing Poor Performers

Incentives, financial or non-financial, may offered to encourage
supervisors to make special efforts to help poor performers improve.
Supervisory appraisals, for example, might stress the importance of
working with poor performers to upgrade their performance. The
possibilities are extensive.
Counseling, Transfer, Termination
There is always the possibility that an employee who receives poor
appraisal results is in fact a chronic poor performer. No employer is
obliged to tolerate poor performance forever. Consistently poor
appraisal results will indicate a need for counseling, transfer or
termination. The exact remedy will depend on the circumstances.
Techniques of Performance Appraisal
Traditional Method:
1. Essay Appraisal Method
This traditional form of appraisal, also known as Free Form
method involves a description of the performance of an employee
by his superior. The description is an evaluation of the performance
of any individual based on the facts and often includes examples
and evidences to support the information. A major drawback of the
method is the inseparability of the bias of the evaluator
2. Straight Ranking Method
This is one of the oldest and simplest techniques of performance

appraisal. In this method, the appraiser ranks the employees from
the best to the poorest on the basis of their overall performance. It
is quite useful for a comparative evaluation.
3. Paired Comparison Method
A better technique of comparison than the straight ranking method,

this method compares each employee with all others in the group,
one at a time. After all the comparisons on the basis of the overall
comparisons, the employees are given the final rankings.
4. Critical Incidents Method
In this method of Performance appraisal, the evaluator rates the

employee on the basis of critical events and how the employee
behaved during those incidents. It includes both negative and
positive points. The drawback of this method is that the supervisor
has to note down the critical incidents and the employee behavior
as and when they occur.
5. Field Review Method
In this method, a senior member of the HR department or a

training officer discusses and interviews the supervisors to evaluate
and rate their respective subordinates. A major drawback of this
method is that it is a very time consuming method. But this method
helps to reduce the superiors personal bias.
6. Checklist Method
The rater is given a checklist of the descriptions of the behaviors of
the employees on job. The checklist contains a list of statements on
the basis of which the rater describes the on the job performance of
the employees.
7. Graphics Rating Scale Method
In this method, an employees quality and quantity of work is

assessed in a graphic scale indicating different degrees of a
particular trait. The factors taken into consideration include both
the personal characteristics and characteristics related to the on-
the-job performance of the employees. For example a trait like Job
Knowledge may be judged on the range of average, above average,
outstanding or unsatisfactory.
8. Forced Distribution Method
To eliminate the element of bias from the raters ratings, the

evaluator is asked to distribute the employees in some fixed
categories of ratings like on a normal distribution curve. The rater
chooses the appropriate fit for the categories on his own discretion.
Modern Method:
1. Management by Objective Method
The concept of Management by Objectives (MBO) was first given by

Peter Drucker in 1954. It can be defined as a process whereby the
employees and the superiors come together to identify common goals,
the employees set their goals to be achieved, the standards to be
taken as the criteria for measurement of their performance and
contribution and deciding the course of action to be followed.
MBO is often achieved using set targets. MBO introduced the SMART
criteria: Objectives for MBO must be
SMART (Specific, Measurable, Achievable, Relevant, and Time-

Specific).
In some sectors (Healthcare, Finance etc.) many add ER to make
SMARTER, where the E=Extendable R=Recorded.
# The MBO Process
The principle behind Management by Objectives (MBO) is to create

empowered employees who have clarity of the roles and
responsibilities expected from them, understand their objectives to be
achieved and thus help in the achievement of organizational as well as
personal goals.
Some of the important features and advantages of MBO are:
Clarity of goals With MBO, came the concept of SMART goals

i.e. goals that are:
> Specific >Measurable >Achievable

> Realistic >Time bound
The goals thus set are clear, motivating and there is a linkage
between organizational goals and performance targets of the
employees.
Better communication and Coordination Frequent reviews and

interactions between superiors and subordinates helps to maintain
harmonious relationships within the enterprise and also solve many
problems faced during the period.
Limitations
There are several limitations to the assumptive base underlying the

impact of managing by objectives, including:
1. It over-emphasizes the setting of goals over the working of a plan

as a driver of outcomes.
2. It underemphasizes the importance of the environment or context

in which the goals are set. That context includes everything from the
availability and quality of resources, to relative buy-in by leadership
and stake-holders. As an example of the influence of management
buy-in as a contextual influencer, in a 1991 comprehensive review of
thirty years of research on the impact of Management by Objectives,
Robert Rodgers and John Hunter concluded that companies whose
CEOs demonstrated high commitment to MBO showed, on average, a
56% gain in productivity. Companies with CEOs who showed low
commitment only saw a 6% gain in productivity.
3. It did not address the importance of successfully responding to

obstacles and constraints as essential to reaching a goal. The model
didnt adequately cope with the obstacles of: - Defects in resources,
planning and methodology, - The increasing burden of managing the
information organization challenge, - The impact of a rapidly changing
environment, which could alter the landscape enough to make
yesterdays goals and action plans irrelevant to the present.
When this approach is not properly set, agreed and managed by

organizations, in self-centered thinking employees, it may trigger an
unethical behavior of distorting the system of results and financial
figures to falsely achieve targets that were set in a short-term,
narrow, bottom-line fasion.
The use of MBO needs to be carefully aligned with the culture of the
organization. While MBO is not as fashionable as it was pre the
'empowerment' fad, it still has its place in management today.
2. 360 Degree Appraisal Method
The US armed forces first used 360-degree feedback to support

development of staff in the 1940s.The system gained momentum
slowly, but by the 1990s most HR and OD professionals understood
the concept.
360 degree feedback, also known as 'multi-rater feedback', is the most

comprehensive appraisal where the feedback about the employees
performance comes from all the sources that come in contact with the
employee on his job.
360 degree respondents for an employee can be his/her peers,

managers (i.e. superior), subordinates, team members, customers,
suppliers/ vendors - anyone who comes into contact with the
employee and can provide valuable insights and information or
feedback regarding the on-the-job performance of the employee.
360 degree appraisal has four integral components:
1. Self appraisal 2. Superiors appraisal

3. Subordinates appraisal 4. Peer appraisal.
Self assessment is an indispensable part of 360 degree appraisals and

therefore 360 degree Performance appraisal have high employee
involvement and also have the strongest impact on behavior and
performance. It provides a "360-degree review" of the employees
performance and is considered to be one of the most credible
performance appraisal methods.
360 degree appraisal is also a powerful developmental tool because

when conducted at regular intervals (say yearly) it helps to keep a
track of the changes others perceptions about the employees. Some
of the organizations following it are Wipro, Infosys, and Reliance
Industries etc.
Why organizations may not adopt the 360 degree approach
1. Return on investment, for the time and energy required, is

perceived to be minimal.
2. Transparent feedback can be adversely affected by emotions and
ongoing peer conflicts.
3. Appraisees are not ready for honest and open feedback.
4. Some cultures rigidly avoid passing negative feedback, or
information, to superiors or elders.
3. Assessment Centers
An assessment centre typically involves the use of methods like social/informal events,
tests and exercises, assignments being given to a group of employees to assess their
competencies to take higher responsibilities in the future. Generally, employees are given
an assignment similar to the job they would be expected to perform if promoted. The
trained evaluators observe and evaluate employees as they perform the assigned jobs and
are evaluated on job related characteristics.
The major competencies that are judged in assessment centers are interpersonal skills,
planning and organizing capabilities, motivation, career orientation etc. assessment
centers are also an effective way to determine the T&D needs of the targeted employees.
4. Behaviorally Anchored Rating Scale
Behaviorally Anchored Rating Scales (BARS) is a relatively new

technique which combines the graphic rating scale and critical
incidents method. It consists of predetermined critical areas of job
performance or sets of behavioral statements describing important job
performance qualities as good or bad (for e.g. the qualities like inter-
personal relationships, adaptability and reliability, job knowledge etc).
These statements are developed from critical incidents.
In this method, an employees actual job behavior is judged against
the desired behavior by recording and comparing the behavior with
BARS.
5. Human Resource Accounting
Human resources are valuable assets for every organization. Human

resource accounting method tries to find the relative worth of these
assets in the terms of money. In this method the Performance
appraisal of the employees is judged in terms of cost and contribution
of the employees.
The cost of employees include all the expenses incurred on them like
their compensation, recruitment and selection costs, induction and
training costs etc whereas their contribution includes the total value
added (in monetary terms). The difference between the cost and the
contribution will be the performance of the employees. Ideally, the
contribution of the employees should be greater than the cost incurred
on them.
Project
Overview
Objective
To asses the training & development needs of employees

know where they stand insofar as their performance for the
purpose of their development.
To create a new performance appraisal form which is easier

& more under stable to fill up.
To improve communication, performance appraisal provides

a format for dialogue of the superior & subordinate, and
improves understanding of personnel goals & concerns. This
can also have the effect of increasing the trust between the
rater & rate.
To recognize the good performer & decided the pay raise or

any allowances given to him/her.
About my Work
Employee Personnel Files
Personnel files should be maintained in a manner that complies laws,

and a random check of these files is always helpful. Personnel files
should contain information such as: resume & applications, offer
letters etc. The entire legal documents about employees are
maintained in these files.
At VADILAL I have to manage these files into a proper manner.

Because of this information you want about any employee about any
matter can get easily, it saves our time.
At first I arrange according to the different Departments. All the files

are checked by me & I arrange the documents of each employee
personnel files. Make different block of resigned files. I found that Exit
Interview Form is not filled up by past employees.
The manner I arrange the Documents is:
Covering Letter
Resume
Application for employment( Fill up by applicant)
Interview Evaluation Report after final Interview
Appointment Letter
Offer Letter
Joining Letter Format
Various Certificates required at time of Joining(Prescribed in HR

Department functions)
Any Leave or ML(Medical Leave)
Any Loan taken by employee(Approval of that loan)
Confirmation Letter(If You are at probationary period of 6

months )
Performance Appraisal Form
Promotion Letter
Transfer Letter
Relieving Letter
Resignation Letter
Full & Final Settlement
I think this was a right manner in which we arrange the documents

any suggestions are always ready to accept. It was a first practical
work I have done in HR so if there is any mistake made by me take
it as in positive manner.
Review of performance appraisal is Oct-07 to Sep-08.IN very next

month appraisal form collect by HR Department & evaluation starts.
Performance appraisal is quite good, but I just suggested little
change in that.
Performance appraisal Form is somewhat more focused on

explanatory part. I just make it so simple & objective type. Its
advantage is that in some cases where employee is not good in oral
or written expression he/she filled up their form by others, so if it
was in objective no need to do it be what you really are.
I also attached Instruction manual for appraise for his concern. It is
also useful for employee to understand the procedure of evaluation.
For general information about each criteria few explanations is

written in the form so it will clear appraisers confusion in some
cases.
I added Employee Feedback column to see reaction of them. I was

not created 360 degree Appraisal form because of its limitations but
I can merge some concept of modern methods of appraisal in this

form. so by asking appraise to his appraisal I get more information
about how fair the appraisal is done & are employee are satisfied by
it or not.
As in Assessment Center method I just check its performed

goals/objective to evaluate him & check his job related
characteristics like planning & organizing skills etc. to decide
whether he has to give higher responsibilities or not for this I also
made some discussion points which are discussed by his/her
immediate boss/HOD to decide his future needs to perform good.
I have attached a sample performance appraisal for along with this

project report. Its my humble request you to consider it, at last
your suggestions are promptly required & implemented.
WORK KNOWLEDGE
1. JOB KNOWLEDGE
A. Outstanding
Excellent understanding of job assignments and duties. Extremely
knowledgeable at all times.
B. Exceeds Expectations
Good knowledge of duties. Well informed. Actively pursues additional job
knowledge.
C. Meets Expectations
Has adequate knowledge of duties. Needs little instruction.
D. Approaches Expectations
Inadequate knowledge of duties. Understanding of job duties not sufficient.
Needs frequent instruction.
E. Unsatisfactory
Definite lack of knowledge. Very little understanding of job duties. Needs
extensive instruction.
Comments:
2. QUALITY OF WORK
A. Outstanding
Achieves exemplary quality at all times. Always completes projects in an
accurate and thorough manner.
Quality of work exceeds requirements. Projects and duties are well researched
and prepared. Work is executed accurately and completely.
Work is of an acceptable quality. Projects and assignments satisfactory
completed.
Work is sometimes of poor quality, although some work may be satisfactory.
Required rework on a regular basis.
E. Unsatisfactory
Work is of poor quality. Projects and assignments are incomplete and poorly
constructed and executed. Requires frequent rework.
Comments:
3. PROBLEM SOLVING / DECISION MAKING

A. Outstanding
Defines problems and makes proper analyses quickly and accurately. Uses all
information sources and job knowledge to fullest potential. Demonstrates
excellent insight in solving problems. Takes prompt and appropriate action
and follows through.
Possesses good decision-making skills. Uses job knowledge and information
sources to good advantage. Shows consistent insight in solving problems.
Understands situations in most cases. Analyzes problems to make sound
decisions. Demonstrates insight in solving problems.
Researches or understands in some cases. May be hesitant about making
decisions in general. May make wrong decisions due to lack of knowledge or
evaluation of the situation
E. Unsatisfactory
Doesnt research or evaluate situations properly. Makes decisions with little
information or research or refuses to make decisions or makes poor decisions.
Demonstrates little or no insight in solving problems
Comments:
WORK MEASURABILITY
4. DELEGATION OF RESPONSIBILITY
A. Outstanding
Highly skilled in delegating responsibility and encourages his/her staff to
grow in responsibility.
Consistently and effectively delegates appropriate responsibility to his/her
staff and requires accountability.
Delegates appropriate responsibility to his/her staff.
Is reluctant to delegate responsibility but does so on occasion.
E. Unsatisfactory
Does not delegate responsibility and performs even minor tasks himself.
Comments:
GOALS ACHIEVEMENT
5. PLANNING ABILITY
A. Outstanding
Demonstrates exemplary ability to do long range and short term planning
based on set goals and objectives.
Sets clear objectives. Uses available resources well. Consistently forecasts to
improve planning.
Is a careful, effective planner. Anticipates and takes action to solve problems.
Plans ahead occasionally. Identifies easy problems, just enough to get by in
the present job.
E. Unsatisfactory
Never seeks or finds problems or areas of responsibilities. Often performs
poorly by never seeing ahead.
Comments:
6. ORGANIZATIONAL ABILITY
A. Outstanding
Is a highly skilled organizer. Is able to obtain optimum effectiveness.
Consistently displays effective organization.
Displays efficiency of operation. Makes appropriate use of resources.
Inconsistent in meeting organizational efficiency. Frequently disorganized,
lacking controlling skills or not using them.
E. Unsatisfactory
Is a poor organizer. Does not make effective use of resources. Always
disorganized. Often inefficient.
Comments:
7. INITIATIVE
A. Outstanding
Always takes initiative within area of responsibility and beyond.
Consistently takes the initiative.
Is creative and initiates new procedures.
Has occasionally identified problems and developed solutions.
E. Unsatisfactory
Does develop new ideas. Often ignores problems.
Comments:
8. ORAL EXPRESSION
A. Outstanding
Outstanding ability to communicate ideas to others.
Consistently able to express ideas clearly and concisely.
Usually organized and expresses thoughts clearly and concisely.
Sometimes able to express thoughts clearly.
E. Unsatisfactory
Unable to express thoughts clearly. Lacks organization.
Comments:
9. WRITTEN EXPRESSION
A. Outstanding
Outstanding ability to communicate ides to others.
Consistently able to express ideas clearly and concisely.
Usually organizes and expresses thoughts clearly and concisely.
Sometimes able to express thoughts clearly.
E. Unsatisfactory
Unable to express thoughts clearly. Lacks organization.
Comments:
10. LEADERSHIP
A. Outstanding
Employees demonstrate exceptional motivation and teamwork. Training and
employee development procedures are always utilized. Corrective action is
fair and very effective. Outstanding level of communication with employees.
Supervised employees demonstrate consistent level of motivation and
teamwork. Training procedures and work standards are well developed and
communicated. Disciplinary measures are appropriate and effective.
Encourages open communication with employees.
Supervised employees demonstrate satisfactory motivation and teamwork.
Training is undertaken and completed on a regular basis. Work standards are
adequate. Communicates satisfactorily with employees.
Supervised employees demonstrate marginal motivation and initiative.
Training only undertaken in crisis situations. Performance objectives and
standards are seldom developed or communicated. Communicates poorly with
employees.
E. Unsatisfactory
Supervised employees lack motivation and initiative. Little training
undertaken. Performance objectives and standards are neither developed nor
communicated.
Comments:
11. OVERALL EVALUATION

A. Outstanding
Performance is outstanding, greatly exceeds normal expectations in all
important aspects.
Performance exceeds standards in all important aspects.
Performance meets standard needs in all important aspects.
Performance meets standards in some aspects but is below in others, which
need improvement.
E. Unsatisfactory
Overall performance is well below standards.
Prior Year Goal/Outcome
Goal/Objective Outcome/Measure Timeframe Status

Upcoming Year - Proposed Goals
Expected Outcome Issues or

Goal/Objective Timeframe
/Measurable Criteria Comments
Discussion Points:
Employees View Recommendations

What do you like & dislike about
your job?
What elements of your jobs do you
find
most difficult & most interested?
Training Requirement felt
RATING & REMARKS OF THE HOD (Rate as per grade

mentioned below)
DATE:
SIGN:
O-outstanding, E-exceeds expectations, M-meets expectations,
A- approaches expectations, U-unsatisfactory
Employees Comments/Reactions : (Optional)
I have read & discussed this evaluation with my supervisor/ HOD & I
understand its
Contents. My signature means that I have been advised of my
performance status &
Does not necessarily imply that I agree with appraisal or the contents.
DATE
SIGN
Instructions: For each competency, provide a mark ( ) in the rating column for each
behavior that demonstrates the competency. In the COMMENTS section, provide
specific examples and illustrations when selecting a rating of approaches expectations
or unsatisfactory.
O= Outstanding Objectives and standards are clearly and substantially

surpassed. Consistently and significantly exceeds all
performance expectations and standards. Highest
performance level. Demonstrates a personal commitment to
a high level of performance and results, even under
challenging work goals.
E= Exceeds Frequently exceeds job requirements. Makes contributions
Expectations well beyond job demands. Seizes initiative in development
and implementation of challenging work goals. Each
project or job is done thoroughly and on time. Thinks
beyond details of the job, working toward the overall goals
of the component.
M= Meets
Performance is what is expected of a fully qualified and
Expectations experienced person in this position. All objectives and
standards are met. Consistently meets all performance
expectations and standards. Job well done. Errors are
minimal and seldom repeated. Prioritizes problems and
projects well. Requires normal supervision and follow-up.
Almost always completes work or projects on schedule.
A= Approaches Objectives and standards are generally met but
Expectations full results are
not totally achieved. Occasionally falls short of
consistently
meeting performance expectations and standards.
Some
performance aspects were not met needs slight
improvement. Could result from being newly appointed to
the position continuing to learn all aspects of the position.
U= Unsatisfactory
Objectives and standards are consistently not met.
Consistently fails to meet performance expectations. Needs
significant improvement. Has been on the job long enough
to have shown better performance. Excessive attention by
supervisor is required. Does not grasp situation when
explained. Corrective action is required.
Comparison of Performance Appraisal

Forms
Current form is largely in descriptive manner. Somewhere the
employee is not enough capable of describing his/her abilities on
paper because of this the good performance is not evaluated
properly.
There are different dimensions set for appraise like

O - Outstanding
VG Very Good
G - Good
FG - Fairly Good
A - Average
BA - Below Average but there is no proper
criteria to judge all the parameters of the
employees.
Assignments/Goals for coming year & in the current year are

asked, but timeframe is not set for that.
Employee feedback is not asked in the form for further

improvement. For a good performance appraisal system
feedback of appraise is useful to evaluate satisfaction of
employee about the procedures.
There is no parameter for Oral & written expression of

employees.
Conclusions
Performance Appraisal System is an important system of any

organization. Because it is related with each employee of any
department.
VADILALs Personnel & Administration department performs the
whole procedure of performance appraisal very well. There are some
recommendations given by me to add up new parameters to make it
more efficient & time-saver system.
During the training period at VADILAL, I learnt how the modern

theories can be implemented, what are the procedures for handling
employee personal files etc. practical knowledge I get.
The P&A Department very hard to cope up with latest modern trends
in Human Resource. They are open for the change & good suggestions.
At last but not the least I can say that VADILAL is one of the fastest
emerging companies in India. It was a nice experience to work here &
I hope I get your marvelous support for future projects.
Recommendations
These are some suggestions I have find by studying Performance

Appraisal System at VADILAL.
A more objective type appraisal to appraise employees. This
will provide more thorough & accurate recordings of
information.
Induction programme of new employee also provide

information about how Performance Appraisal is done, what
are the factors which judge your performance & how it will be
fill up etc.
Provide employees with relevant feedback Vague,

generalized, subjective evaluations may lead to litigation.
Promptly evaluate non productive employees. When

managers tolerate an employee with a performance problem
for months & then suddenly give him or her negative
evaluation & terminate him or her, the employee may claim
that the action was arbitrary or discriminatory & may be able
to show that no opportunity for improvement was given.
Give the employee an opportunity for feedback or to

comment about their appraisal so when you want to take hard
steps it will support the fact that you provided the employee
with prior notice.
Establish a review audit system to prevent biasness or

emotions that might effect the appraisal.
Bibliography
Books
Human Resource & Personnel Management by
K.Aswathappa
Human Resource Management ( Sikkim Manipal

University)
Internet
www.vadilalgroup.com
www.google.com
www.citehr.com
www.performance-appraisal.com
www.hr-guide.com

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INDEX

Definition & Concepts

Name: Vadilal Industries Limited.

Corporate Office: VADILAL HOUSE

Size of Unit: Large-scale Unit

Establishment Year: 1926

Factory Locations: Dudheswar,Ahmedabad, Dharampur,Valsad

Annual Turnover: Rs.250 crores.

Market share in India: 25%

Market share in Gujarat: 60%

Number of Products: More than 200 Products

Total Production: 10,000 Liter/Day

The Ice-cream Experts

The Cream of India

To become an Indian MNC in frozen foods.

To provide products and services at an affordable price without

Today, the name Vadilal conjures images of lip-smacking ice cream in

Eventually, Ranchod Lal's sons, Ramchandra and Lakshman, inherited the

In 1972-73, the company had 8-10 outlets in Ahmedabad. Gradually, we

In 1997 Vadilal was converted from Private Limited to Public Limited

Vadilal Group has Head Quarter in Gujarat (Ahmedabad), the most

The "Vadilal" philosophy of providing its customers with quality Products

Today it is a diversified Business Group with major interests in Ice-

Vadilal Enterprise Ltd. Is the marketing arm of Vadilal Industries Ltd.

Company has varieties in Bulks, Party Packs, Family Packs, Cones,

> One of the largest Ice-cream manufacturers of India

> Product Matrix of over 200 SKUs

> A fleet of 115 refrigerated vehicles

> Exclusive Ice Cream boutiques known as Happinezz

> Largest cold chain in India

> 25 stock points all across the country

Processed Food Division

> Entered Horticultural Processing Industry in May 1991

> Commissioned an ultra modern facility at Gujarat, India

> About 80% of produced is exported to Europe, USA, Canada, Middle

Caters complete Forex advisory services to Groups, in areas of RBI

BULLION Informative service of Gold, Silver, and Precious metals on

LME-METAL Informative service of most base metal quotes at LME,

> Focused on timely completion of projects undertaken.

> Assuring sound construction using best raw materials.

> Has developed unique corporate complexes, comfort & convenience as

> Developing residential bungalows schemes amidst of nature offering a

Vadilal Chemicals is a multi location & multi product company of Vadilal

Manufacturing Industrial & specialty gases, petroleum products since

Caters to over 2500 industrial customers in India.

Assuring consistent purity, quality & stability through extensive cylinder

Specialty in tailor made mixtures to meet the essential requirement of

Vadilal Group has many companies under its banner, the

1 Vadilal Industries Ltd.

2 Vadilal Enterprises Ltd.

3 Vadilal International Pvt. Ltd.

4 Kalpit Realities and Services Ltd.

Vadilal Industries Ltd. (VIL)

This is the Manufacturing Company of the group. It has FOUR

Vadilal Enterprises Ltd. (VEL)

This is the Marketing Company of the group.

Vadilal International Pvt. Ltd. (VIPL)

Kalpit Realities and Services Ltd. (KRSL)

This is the company which is into Real Estate and Transportation

Directors of only VIL

Mr. Ramchandra Gandhi- Chairman

Mr. Rajesh Gandhi Managing Director

The employees are divided as follows: Senior Management, Middle