A

SUMMER TRAINING REPORT

ON
“STUDY OF PERFORMANCE APPRAISAL AT IDBI
Bank Sitapur ”
Submitted In Partial Fulfillment for the Award of the Degree of

“Master of Business Administration”

2012

SUBMITTED TO

UNDER GUIDANCE OF SUBMITTED BY

Mr. Manish Kr. Srivastava Krati Mishra
( Branch Head) B.B.A.I, Sitapur.
Roll No:-090561

Women’s Institute of Engineering &

Technology
(AFFILIATED TO GBTU, Lucknow)

1
 D E C LA R AT I O N
I, Shadma Khatoon, Student of M.B.A, Final Year, W.I.E.T, Resoura,
Sitapur, declare that the project on “STUDY OF Performance Appraisal at
IDBI BANK, SITAPUR , ” is the result of my own efforts and it is based on
data collected and guidance given to me.

I have prepared it as a part of my course curriculum. This report is

correct to best of my knowledge and so far has not been published anywhere
else.

M.B.A, W.I.E.T, Sitapur

2
 ACKNOWLEDGEMENT

I feel great pleasure in presenting this research report in the hands of my

mentor. It is really a great opportunity given by him to me. This research work

is combined effort of many hearts, hands and brains.

First of all I would like to thank God who showered his blessing in every

step of this profile and has given me this opportunity to conduct this industrial

profiling.

I am immensely grateful to my Guide Mr. Manish Kr.Srivastava, Branch

Head, IDBI Bank, Sitapur and my college guide Ms. Anchal Agarwal Asst. Prof.

MBA Deptt, IET, Sitapur, for providing me this opportunity for bringing out my

talent.

I also want to thank all my teachers, Staff Member and Library members

for their valuable advice and guidance who helped me to complete this project

successfully.

Shadma Khatoon

M.B.A, W.I.E.T, Sitapur

3
 Table of Content

1. Executive Summary 5-6

2. Introduction 7-9

3. Objective of Study 10-11

4. Scope of the Study 12-13

5. Literature Review 14-17

6. About performance appraisal 18-41

7. Research Methodology 42-45

8. Company Profiles 46-67

9. Data Analysis 68-84

10. Findings 85-87

11. Conclusion 88-90

12. Recommendations 91-92

13. Limitation 93-94

14. Bibliography 95-96

15. Annexure 97-100

4
Executive Summary

5
 Executive Summary
For this research I have gone for exploratory research using the secondary data study. And

To collect primary data I have conducted a research in IDBI Bank through survey and

interviewing the personnel department to gain data about the performance appraisal process.

The present appraisal system was introduced in IDBI Bank in 1986. The system has

continued since then with minor modifications.

The research methodology which follows is the backbone of any study. It is a path

towards the accomplishment of the objectives of the study and it is important to carry out the

research work in a certain frame work.

IDBI Bank existing performance management system raised many points during

discussions at plant/unit visits. So all these review have indicated that there is a need for

designing a new system to be implemented. They have initiated the process of designing a

new performance management system for IDBI Bank. And these problems I will discuss in

the thesis later and then give recommendations according to it.

6
INTRODUCTION

7
 INTRODUCTION
There is great unhappiness all around with performance appraisals. Rarely does one come

across managers who are happy with the systems in their organizations. When such

unhappiness exists, why should we continue to have them? But managers find it difficult to

do without them as in the absence of any system, howsoever weak it may be, it is difficult to

get work done from their employees. It is a good mechanism to control them. Employees

want promotions, salary jumps, good working conditions, would placing in high positions,

and transfers to places of their choices and jobs giving maximum satisfaction, and so on.

Therefore, if people get what they want, they should also give what their bosses expect. And

appraisal of performance is one of the systems to make sure that people at every level do

things the way their bosses want them to do. Thus, the bosses at every level strive for better

ratings of their own performance by assessing the performance of their subordinates and

controlling their behavior.

The Private sector in India – as elsewhere world wide – has been passing through a

turbulent phase. The public sector has now arrived at the cross- roads. While it is

restructuring itself and gearing up to meet the challenges of the coming decades, the public

sector continues to be under attack. The prevailing mindsets overlook the content of goals,

constraints or paradigm changes of the new economic times and the convergence of the

components of a new vision which the public sector – like the private sector – has acquired in

the recent years.

For this research I have gone for exploratory research using the secondary data study. And

To collect primary data I have conducted a research in IDBI Bank through survey and

interviewing the personnel department to gain data about the performance appraisal process.

The present appraisal system was introduced in IDBI Bank in 1986. The system has

continued since then with minor modifications.

8
 The research methodology which follows is the backbone of any study. It is a path

towards the accomplishment of the objectives of the study and it is important to carry out the

research work in a certain frame work.

IDBI Bank existing performance management system raised many points during

discussions at plant/unit visits. So all these review have indicated that there is a need for

designing a new system to be implemented. They have initiated the process of designing a

new performance management system for IDBI Bank. And these problems I will discuss in

the thesis later and then give recommendations according to it.

9
Objectives of the study:

10
 Objectives of the study:

 To analyze and apply performance appraisal strategies to improve the performance of

the individual employees.

 To know about the requirements of the employees.

 To know the best performance appraisal strategy of the company.

 Improve the performance of the employees and there by improving the overall

performance of the company, by providing suggestions if any.

 To verify the standard of IDBI BANK, SITAPUR when compared to other Bank

industries present in the market.

11
Scope of the study:

12
 Scope of the study:

The study concentrates on the HR affairs of the company. It involves the study of

performance standards of the employees of “IDBI BANK, SITAPUR” .

This study has been carried out in order to learn the Performance Appraisal System of

IDBI BANK; to know what strategies are being implied and how far they are effective.

Performance Appraisal is the important aspect in the organization to evaluate the employees
performance. It helps in understanding the employees work culture, involvement, and
satisfaction. It helps the organization in deciding employees promotion, transfer, incentives,
pay increase.

13
Review of literature

14
 REGIONAL CHIEF

Review of literature

 Fletcher C, Performance appraisal and management, November 4, 2001:

Performance appraisal has widened as a concept and as a set of practices and in the form of

performance management has become part of a more strategic approach to integrating HR

activities and business policies. As a result of this, the research on the subject has moved

beyond the limited confines of measurement issues and accuracy of performance ratings and

has begun to focus more of social and motivational aspects of appraisal. This article identifies

and discusses a number of themes and trends that together make up the developing research

agenda for this field. It breaks these down in terms of the nature of appraisal and the context

in which it operates. The former is considered in terms of contemporary thinking on the

content of appraisal (contextual performance, goal orientation and self awareness) and the

process of appraisal (appraiser–appraise interaction, and multi-source feedback). The

discussion of the context of appraisal concentrates on cultural differences and the impact of

new technology.

 Gregory H. Dobbins, Performance Appraisal as Effective Management or Deadly

Management Disease, 1990: Understanding person and system sources of work variation is

fundamental to performance appraisal. Two divergent perspectives on this issue, the

traditional human resource management view and the statistical process control view

(Deming, 1986), are contrasted. Two studies are reported that investigate two specific

questions that arise from a broader view of the appraisal process. Results indicate that

managers and subordinates believe that typical poor performance has different causes and that

actual productivity levels far outweigh person or system sources of performance variance in

appraisal judgments.

15
 Gregory H. Dobbins, A Contingency Approach to Appraisal Satisfaction, 1990: The

present study explored the moderating effects of organizational variables on the appraisal

characteristic-appraisal satisfaction relationship. Analyses indicated that the appraisal

characteristics of action plans, frequency, and rater training were more positively related to

appraisal satisfaction when subordinates experienced role conflict, were not closely

monitored, and supervisors had a large span of control. The results provide substantial support

for conceptualizing appraisal satisfaction as a contingent function of both appraisal

characteristics and organizational variables. Implications of the findings for the design of

appraisal systems, appraisal effectiveness, and future research are discussed.


Taylor Cox, Differential Performance Appraisal Criteria, 1986 : Performance

appraisal ratings of 125 first-level managers were analyzed to investigate the degree to which

the criteria used to evaluate the overall job performance of black managers differs from that

used to evaluate white managers. The performance appraisal form included items that

measured both the social behavior dimension and task/goal accomplishment dimension of job

performance. The appraisal ratings of both groups on each dimension were correlated with

measures of overall job performance and prompt ability. Results indicated that social behavior

factors are more highly correlated with the overall job performance of black rates than for

white rates. Implications of these results for both black managers and organizations are

discussed.


David A. Waldman, Predictors of Employee Preferences for Multirater and

Group-Based Performance Appraisal, 1997: This study conceptualizes and measures user

preferences for 360-degree appraisals and group-level performance management (PM). Users

are defined as either recipients of PM processes or those whose job it is to administer the

process. Aspects of individual users, their work design, and current appraisal context were

16
used to predict preferences. Two studies were conducted involving data collection in a large

Canadian telecommunications conglomerate and a department of the Canadian government,

respectively. Predictors explained significant amounts of variance in user preferences,

especially those pertaining to group-level PM. Practical implications are suggested with

regard to collecting and using user preferences. In addition, suggestions for future research are

offered concerning the need to examine a broad range of users in different organizational

settings and to measure actual system design features and their effectiveness.


Dennis W. Organ, A Restatement of the Satisfaction-Performance Hypothesis,

1988: This article reviews recent evidence in support of Organ’s (1977) argument that

satisfaction more generally correlates with organizational prosocial or citizenship-type

behaviors than with traditional productivity or in-role performance. An attempt is then made

to interpret just what it is in satisfaction measures that provide this correlation, leading to the

suggestion that fairness cognitions comprise the major factor. Implications of this

interpretation for theory, research, and management practice are offered.

17
 ABOUT

PERFORMANCE

APPRAISAL

18
 INTRODUCTION TO HUMAN RESOURCE

MANAGEMENT

Human Resource (or personnel) management, in the sense of getting things done through

people, is an essential part of every manager’s responsibility, but many organizations find it

advantageous to establish a specialist division to provide an expert service dedicated to

ensuring that the human resource function is performed efficiently.

“People are our most valuable asset” is a cliché, which no member of any senior management

team would disagree with. Yet, the reality for many organizations are that their people remain

under valued, under trained and under utilized.

The market place for talented, skilled people is competitive and expensive. Taking on new

staff can be disruptive to existing employees. Also, it takes time to develop ‘cultural

awareness’, product / process / organization knowledge and experience for new staff

members.

FUNCTIONS OF HUMAN RESOURCE MANAGEMENT

Following are the various functions of Human Resource Management that are essential

for the effective functioning of the organization:

1. Recruitment

2. Selection

3. Induction

4. Performance Appraisal

5. Training & Development

19
RECRUITMENT

The process of recruitment begins after manpower requirements are determined in terms

of quality through job analysis and quantity through forecasting and planning.

SELECTION

The selection is the process of ascertaining whether or not candidates possess the

requisite qualifications, training and experience required.

INDUCTION

a) Induction is the technique by which a new employee is rehabilitated into the changed

surroundings and introduced to the practices, policies and purposes of the

organization.

20
 Appraisal
Performance appraisal is a method of evaluating the behavior of employees in the work spot,

normally including both the qualitative & quantitative aspect of job performance.

Performance Measurement Stages of IDBI Bank

INTRODUCTION TO PERFORMANCE APPRAISAL SYSTEM

Performance Appraisal has been around of hundreds of years, as it is only human nature to

evaluate fellow colleagues. Effective appraisal system should address clarity, openness,

fairness; recognize productivity through reward; & be cognizant to appraisal leadership

qualities.

“Performance Appraisal is the process of evaluating the performance & qualification of the

employees in terms of the requirements of the job for which he is employed, for the purpose

of administration including placement, selections for promotions, providing financial rewards

& other action which required differential treatment among the group as distinguished from

actions affecting all member equally.”

BY HEYEL

21
“Performance Appraisal determines who shall receive merit increase, counsel’s employees

their improvement; determines training needs; determines promo ability; identifies those who

should be transferred more over, it improves employee job performance; encourage

employees to express their views or to seek clarification on duties; broadens thei9r capacity

& potential; promotes a more effective utilization of manpower and improves placement ;

facilitates selection, reward & increase the analytical abilities of supervisors.”

BY RONALD BENJAMIN

22
 NEED FOR PERFORMANCE APPRAISAL:

 To effect promotion based on competence and performance.

 To assess the training &development needs of the employees.

 To bridge the gap between the existing performance & desired performance.

 To help each employee to understand his own strengths &weakness.

 They can be mechanism of increasing communication between the employee &his.

 Supervising officer so that each employee gets to know the difficulties of his

subordinates and attempt to solve them.

 It provides legally defensible reasons for making promotion, transfer, and reward and

discharge decisions.

 They can be instruments to provide an opportunity for employees for self reflection

And goal setting so that individually planned and monitored development takes place.

 They can assist in a variety of personnel decisions by generating data about each

employee periodically.

 Develop inter personal relationship.

 To help in salary increment.

 To prevent grievance & in-disciplinary activities.

 Provide information about the performance ranks.

23
 ACHIEVING ORGANIZATION GOALS

The achievement of an organization’s goals rests with its people. The more talented the

people and the better they are managed and coordinated toward those goals the greater the

chance of success. Performance appraisal is all about providing a way to do this.

The appraisal process starts with a manager and employee setting goals for the year together.

The most effective goals are measurable and have easy to understand performance standards.

24
 CHARACTERISTICS OF GOOD APPRAISAL SYSTEM:

 Increase motivation to perform effectively.

 Increase staff self-esteem.

 Gain new insights into staff and supervisor.

 Better clarity &define job function &responsibility.

 Develop valuable communication among appraisal participants.

 Encourage increase self –understanding among staff as well as insight into the kind of

development activities that are of value.

 Distribute rewards on a fair & credible basis.

 Clarify organizational goals so they can be more readily accepted.

 Improve institutional/departmental manpower planning, test validation,&

development of training programs.

25
 Performance Management

Managing Employees Performance

• Performance management: the process through which managers ensure that

employees’ activities and outputs contribute to the organization’s goals.

• This process requires:

– Knowing what activities and outputs are desired

– Observing whether they occur

– Providing feedback to help employees meet expectations

Stages of the Performance Management Process

26
Purposes of Performance Management

• Strategic Purpose – means effective performance management helps the organization

achieve its business objectives.

• Administrative Purpose – refers to the ways in which organizations use the system to

provide information for day-to-day decisions about salary, benefits, and recognition

programs.

• Developmental Purpose – means that it serves as a basis for developing employees’

knowledge and skills.

Employees Want More Feedback

27
Criteria for Effective Performance Management

28
 Contamination and Deficiency of a Job Performance Measure

Methods for Measuring Performance

29
Basic Approaches to Performance Measurement

Measuring Performance: Making Comparisons

30
Measuring Performance: Rating Individuals - Attributes

Graphic Rating Scale Mixed-Standard Scale

Lists traits and provides a Uses several statements
rating scale for each describing each trait to
trait. produce a final score for
The employer uses the that trait.
scale to indicate the
extent to which an
employee displays each
trait.

Example of a Graphic Rating Scale

31
 Example of a Mixed-Standard Scale

Measuring Performance: Rating Individuals - Behaviors

32
 Behaviorally Anchored Rating
Critical-Incident Method Scale (BARS)
Based on managers’ records
Rates behavior in terms of a
of specific examples of
the employee acting in
scale showing specific
ways that are either statements of behavior
effective or ineffective. that describe different
Employees receive feedback levels of performance.
about what they do well
and what they do poorly
and how they are helping
the organization achieve
its goals.

33
Example of Task- BARS Rating Dimension for a Patrol Officer

34
 Measuring Performance: Measuring Quality

• The principles of total quality management (TQM), provide methods for performance

measurement and management.

• With TQM, performance measurement combines measurements of attributes and

results.

– Subjective feedback

– Statistical quality control

• Coaches provide feedback to their team just as managers provide feedback to their

employees.

• Feedback is important so that individuals know what they are doing well and what

areas they may need to work on.

35
 Sources of Performance Information

• 360-Degree Performance Appraisal: performance measurement that combines

information from the employees’:

– Managers

– Peers

– Subordinates

– Self

– Customers

Performance management is critical for executing a talent management system and involves

one-on-one contact with managers to ensure that proper training and development are taking

place.

36
 Types of Performance Measurement

Rating Errors

• Contrast errors: the rater compares an individual, not against an objective standard,

but against other employees.

• Distributional errors: the rater tends to use only one part of a rating scale.

– Leniency: the reviewer rates everyone near the top

– Strictness: the rater favors lower rankings

– Central tendency: the rater puts everyone near the middle of the scale

• Rater bias: raters often let their opinion of one quality color their opinion of others.

– Halo error: when the bias is in a favorable direction. This can mistakenly tell

employees they don’t need to improve in any area.

– Horns error: when the bias involves negative ratings. This can cause

employees to feel frustrated and defensive.

37
Political Behavior in Performance Appraisals

• Distorting a performance evaluation to advance one’s personal goals

• A technique to minimize appraisal politics is a calibration meeting:

– Meeting at which managers discuss employee performance ratings and

provide evidence supporting their ratings with the goal of eliminating the

influence of rating errors

Giving Performance Feedback

• Scheduling Performance Feedback

– Performance feedback should be a regular, expected management activity.

– Annual feedback is not enough.

– Employees should receive feedback so often that they know what the manager

will say during their annual performance review.

• Preparing for a Feedback Session

– Managers should be prepared for each formal feedback session.

• When giving performance feedback, do it in an appropriate meeting place.

• Meet in a setting that is neutral and free of distractions.

• What other factors are important for a feedback session?

38
• Conducting the Feedback Session

– During the feedback session, managers can take any of three approaches:

– “Tell-and-Sell” – managers tell employees their ratings and then justify those

ratings.

– “Tell-and-Listen” – managers tell employees their ratings and then let the

employees explain their side of the story.

– “Problem-Solving” – managers and employees work together to solve

performance problems.

39
Improving Performance

40
 Legal and Ethical Issues in Performance Management

• Legal

– Performance management processes are often scrutinized in cases of

discrimination or dismissal.

• Ethical

– Employee monitoring via electronic devices and computers may raise

concerns over employee privacy.

Legal Requirements for Performance Management

• Lawsuits related to performance management usually involve charges of:

– Discrimination

– Unjust dismissal

• To protect against both kinds of lawsuits, it is important to have a legally defensible

performance management system.

• A legally defensible performance management system includes:

– Based on valid job analyses, with requirements for job success clearly

communicated to employees.

– Performance measurement should evaluate behaviors or results, rather than

traits.

– Multiple raters (including self-appraisals) should be used.

– All performance ratings should be reviewed by upper-level managers.

There should be an appeals mechanism for employees

41
 RESEARCH

METHODOLOGY .

42
 RESEARCH METHODOLOGY.

Research is a systematic method of finding solutions to problems. It is essentially an

investigation, a recording and an analysis of evidence for the purpose of gaining knowledge.

Sample

A finite subset of population, selected from it with the objective of investigating its properties

called a sample. A sample is a representative part of the population. A sample of 50 BANK

EMPLOYEES in total has been randomly selected. The response to various elements under

each questions were totaled for the purpose of various statistical testing.

Sampling Design.

A sample design is a finite plan for obtaining a sample from a given population. Simple

random sampling is used for this study. The procedure adopted in the present study is

probability sampling, which is also known as chance sampling. Under this sampling design,

every item of the frame has an equal chance of inclusion in the sample

Universe.

The universe chooses for the research study is the employees of IDBI BANK, Sitapur.

Sample Size.

Number of the sampling units selected from the population is called the size of the sample.

Sample of 50 BANK EMPLOYEES were obtained from the population.

. Nature of Research.

43
Descriptive research, also known as statistical research, describes data and characteristics

about the population or phenomenon being studied. Descriptive research answers the

questions who, what, where, when and how.

Although the data description is factual, accurate and systematic, the research cannot describe

what caused a situation. Thus, descriptive research cannot be used to create a causal

relationship, where one variable affects another. In other words, descriptive research can be

said to have a low requirement for internal validity.

Methods of Data Collection.

The data’s were collected through Primary and secondary sources.

Primary Sources.

Primary data are in the form of “raw material” to which statistical methods are applied for the

purpose of analysis and interpretations.

The primary sources are discussion with employees, data’s collected through questionnaire.

Questionnaire.

A well defined questionnaire that is used effectively can gather information on both overall

performance of the test system as well as information on specific components of the system.

A defeated questionnaire was carefully prepared and specially numbered. The questions were

arranged in proper order, in accordance with the relevance.

Nature of Questions Asked.

The questionnaire consists of open ended, dichotomous, rating and ranking questions.

Pre-testing

44
A pre-testing of questionnaire was conducted with 10 questionnaires, which were distributed

and all of them were collected back as completed questionnaire. On the basis of doubts raised

by the BANK EMPLOYEES the questionnaire was redialed to its present form.

Secondary Sources.

Secondary data’s are in the form of finished products as they have already been treated

statistically in some form or other.

The secondary data mainly consists of data and information collected from records, company

websites and also discussion with the management of the organization. Secondary data was

also collected from journals, magazines and books.

Variables of the Study.

The direct variable of the study is the employee performance appraisal system

Indirect variables are the incentives, interpersonal relations, career development

opportunities and performance appraisal system.

Presentation of Data.

The data are presented through charts and tables.

45
Company Profile

46
 COMPANY PROFILE: IDBI Bank

Type PubIDBI BANK (BSE: 500116)

Industry Banking, Financial services

Founded July 1964

Headquarters Mumbai, India

Key people R M Malla (CMD)

Products Credit cards, consumer banking,corporate

banking, finance and
insurance, investment banking,mortgage
loans, private banking,private
equity, wealth management

Revenue 20,858 crore (US$4.16 billion)(2011)[1]

Net income 1,563 crore (US$311.82 million)(2011)

Total assets 253,116 crore (US$50.5 billion)(2011)

Employees 14,000 (2011)

Website www.idbi.com

IDBI Bank Limited is an Indian financial service company headquartered Mumbai, India.

RBI categorised IDBI as an "other pubIDBI BANK sector bank". It was established in 1964

by an Act of Parliament to provide credit and other facilities for the development of the

fledgling Indian industry. It is currently 10th largest development bank in the world in terms

of reach with 1514 ATMs, 923 branches including one overseas branch at DIFC, Dubai and

621 centers including two overseas centers at Singapore & Beijing. Some of the institutions

47
built by IDBI are the Securities and Exchange Board of India (SEBI), National Stock

Exchange of India (NSE), the National Securities Depository Limited (NSDL), the Stock

Holding Corporation of India Limited (SHCIL), the Credit Analysis & Research Ltd, theExim

Bank (India)(Exit Bank), the Small Industries Development Bank of India(SIDBI),

the Entrepreneurship Development Institute of India, and IDBI BANK, which is owned by

the Indian Government.IDBI Bank is on a par with nationalized banks and the SBI Group as

far as government ownership is concerned. It is one among the 26 commercial banks owned

by the Government of India. The Bank has an aggregate balance sheet size of Rs. 2,53,378

crore as on March 31, 2011. IDBI Bank's operations during the financial year ended March

31,

48
Recent developments

To meet emerging challenges and to keep up with reforms in financial sector, IDBI has taken

steps to reshape its role from a development finance institution to a commercial institution.

With the Industrial Development Bank (Transfer of Undertaking and Repeal) Act, 2003, IDBI

attained the status of a limited company viz. "Industrial Development Bank of India

Limited" (IDBIL). Subsequently, the Reserve Bank of India (RBI) issued the requisite

notification on 30 September 2004 incorporating IDBI as a 'scheduled bank' under the RBI

Act, 1934. Consequently, IDBI, formally entered the portals of banking business as IDBIL

from 1 October 2004. The commercial banking arm, IDBI BANK, was merged into IDBI.

In March 2008, IDBI Bank entered into a joint venture with Federal Bank and Fortis

Insurance International to form IDBI Fortis Life Insurance, of which IDBI Bank owns 48

percent. The company ended the year with over 300 Cr in premiums as on 31 March

2009.The name of IDBI Fortis Life Insurance is now changed to IDBI Federal Life

Insurance Co Ltd.

Government of India now owns 65.17% stake in IDBI Bank. Hence IDBI Bank is also

referred as 'The New Age Government owned Bank'

It has bought 10% stake in upcoming commodity bourse Universal Commo-dity Exchange

(UCX) for Rs 10 crore, the bank's top official said. The deal was completed recently. RM

Malla, chairman and MD of IDBI Bank, confirmed that the bank had picked up 10% in what

will become the country's sixth commodity futures exchange. "The idea behind acquiring

equity is to push agriculture loans through this venture," said Malla. "The other advantage is

IDBI will be the only bank among the promoters and therefore all transactions of the

exchange will be routed through IDBI."

49
A breakthrough initiative in customer service was taken by IDBI Bank (branded as 'Customer

Delight Campaign [1]' when it removed many of the charges from its retail banking services.

This step has created a wave in banking industry and put the bank on a developmental

pedestal never seen before. Some of the charges waived are- ATM-cum-Debit card annual

charges, Transaction charges on other banks' ATMs, Demand Draft/Pay Order charges,

RTGS/NEFT charges, Cheque book issuance and utilization charges and many more other

charges.

It was the winner in two categories in Dun & Bradstreet's Polaris Software Banking Awards

2011.

It has now a network of 933 branches, 621 centres and 1514 ATMs as on October 13, 2011.

50
Overview of development banking in India

The concept of development banking rose only after Second World War, after

the Great Depression in 1930s. The demand for reconstruction funds for the affected nations

compelled in setting up a worldwide institution for reconstruction. As a result the IBRD was

set up in 1945 as a worldwide institution for development and reconstruction. This concept

has been widened all over the world and resulted in setting up of large number of banks

around the world which coordinating the developmental activities of different nations with

different objectives among the world. The Narashimam committee had recommended to give

up its direct financing functions and to perform only the promotional and refinancing role.

However, the S.H.Khan committee, appointed by the RBI, recommended its transformation

into a universal bank.

The course of development of financial institutions and markets during the post-

Independence period was largely guided by the process of planned development pursued in

India with emphasis on mobilisation of savings and channeling investment to meet Plan

priorities. At the time of Independence in 1947, India had a fairly well developed banking

system. The adoption of bank dominated financial development strategy was aimed at

meeting the sectoral credit needs, particularly of agriculture and industry. Towards this end,

the Reserve Bankconcentrated on regulating and developing mechanisms for institution

building. The commercial banking network was expanded to cater to the requirements of

general banking and for meeting the short-term working capital requirements of industry and

agriculture. Specialised development financial institutions (DFIs) such as the IDBI,

NABARD, NHB and SIDBI, etc., with majority ownership of the Reserve Bank were set up

to meet the long-term financing requirements of industry and agriculture. To facilitate the

growth of these institutions, a mechanism to provide concessional finance to these institutions

was also put in place by the Reserve Bank.

51
 The first development bank In India incorporated immediately after independence in

1948 under the Industrial Finance Corporation Act as a statutory corporation to pioneer

institutional credit to medium and large-scale. Then after in regular intervals the government

started new and different development financial institutions to attain the different objectives

and helpful to five-year plans.

The early history of Indian banking and finance was marked by strong governmental

regulation and control. The roots of the national system were in the State Bank of India Act of

1955, which nationalized the former Imperial Bank of India and its seven associate banks. In

the early days, this national system operated alongside of a large private banking system.

Banks were limited in their operational flexibility by the government’s desire to maintain

employment in the banking system and were often drawn into troublesome loans in order to

further the government’s social goals.

The financial institutions in India were set up under the strong control of both central and

state Governments, and the Government utilized these institutions for the achievements in

planning and development of the nation as a whole. Thus India financial institutions can be

classified under five heads according to their economic importance:

 All-India Development Banks

 Specialized Financial Institutions

 Investment Institutions

Industrial Development Bank of India (IDBI)

The Industrial Development Bank of India (IDBI) was established on 1 July 1964

under an Act of Parliament as a wholly owned subsidiary of the Reserve Bank of India. In 16

February 1976, the ownership of IDBI was transferred to the Government of India and it was

52
made the principal financial institution for coordinating the activities of institutions engaged

in financing, promoting and developing industry in the country. Although Government

shareholding in the Bank came down below 100% following IDBI’s pubIDBI BANK issue in

July 1995, the former continues to be the major shareholder (current shareholding: 65.14%).

IDBI provides financial assistance, both in rupee and foreign currencies, for green-field

projects as also for expansion, modernization and diversification purposes. In the wake of

financial sector reforms unveiled by the government since 1992, IDBI also provides indirect

financial assistance by way of refinancing of loans extended by State-level financial

institutions and banks and by way of rediscounting of bills of exchange arising out of sale of

indigenous machinery on deferred payment terms.

IDBI has played a pioneering role, particularly in the pre-reform era (1964–91),in

catalyzing broad based industrial development in the country in keeping with its

Government-ordained ‘development banking’ charter.[citation needed]

Narasimam committee recommends that IDBI should give up its direct financing

functions and concentrate only in promotional and refinancing role. But this recommendation

was rejected by the government. Later RBI constituted a committee under the chairmanship

of S.H.Khan to examine the concept of development financing in the changed global

challenges. This committee is the first to recommend the concept of universal banking. The

committee wanted the development financial institution to diversify its activity. It

recommended to harmonies the role of development financing and banking activities by

getting away from the conventional distinction between commercial banking and

developmental banking.

In September 2003, IDBI diversified its business domain further by acquiring the

entire shareholding of Tata Finance Limited in Tata Home finance Ltd., signaling IDBI’s

foray into the retail finance sector. The fully owned housing finance subsidiary has since been

53
renamed ‘IDBI Home finance Limited’. In view of the signal changes in the operating

environment, following initiation of reforms since the early 1990s, Government of India has

decided to transform IDBI into a commercial bank without eschewing its secular

development finance obligations. The migration to the new business model of commercial

banking, with its gateway to low-cost current, savings bank deposits, would help overcome

most of the limitations of the current business model of development finance while

simultaneously enabling it to diversify its client/ asset base. Towards this end, the IDB

(Transfer of Undertaking and Repeal) Act 2003 was passed by Parliament in December 2003.

The Act provides for repeal of IDBI Act, corporatisation of IDBI (with majority Government

holding; current share: 58.47%) and transformation into a commercial bank. The provisions

of the Act have come into force from 2 July 2004 in terms of a Government Notification to

this effect. The Notification facilitated formation, incorporation and registration of Industrial

Development Bank of India Ltd. as a company under the Companies Act, 1956 and a deemed

Banking Company under the Banking Regulation Act 1949 and helped in obtaining requisite

regulatory and statutory clearances, including those from RBI. IDBI would commence

banking business in accordance with the provisions of the new Act in addition to the business

being transacted under IDBI Act, 1964 from 1 October 2004, the ‘Appointed Date’ notified by

the Central Government.

IDBI Bank, with which the parent IDBI was merged, was a new generation Bank. The

Pvt Bank was the fastest growing banking company in India. The bank was pioneer in

adapting to poIDBI BANKy of first mover in tier 2 cities. The Bank has one of the highest

productivity per employee in Indian banking industry.

On 29 July 2004, the Board of Directors of IDBI and IDBI Bank accorded in principle

approval to the merger of IDBI Bank with the Industrial Development Bank of India Ltd. to

be formed incorporated under the Companies Act, 1956 pursuant to the IDB (Transfer of

54
Undertaking and Repeal) Act, 2003 (53 of 2003), subject to the approval of shareholders and

other regulatory and statutory approvals. A mutually gainful proposition with positive

impIDBI BANKations for all stakeholders and clients, the merger process is expected to be

completed during the current financial year ending 31 March 2005.

The immediate fall out of the merger of IDBI and IDBI Bank was the exit of

employees of IDBI bank. The cultures in the two organizations have taken its toll. The IDBI

Bank now is in a growing fold. With its retail banking arm expanding further after the merger

of United western Bank.

IDBI would continue to provide the extant products and services as part of its

development finance role even after its conversion into a banking company. In addition, the

new entity would also provide an array of wholesale and retail banking products, designed to

suit the specific needs cash flow requirements of corporates and individuals. In particular,

IDBI would leverage the strong corporate relationships built up over the years to offer

customised and total financial solutions for all corporate business needs, single-window

appraisal for term loans and working capital finance, strategic advisory and “hand-holding”

support at the implementation phase of projects, among others.[

IDBI’s transformation into a commercial bank would provide a gateway to low-cost deposits

like Current and Savings Bank Deposits. This would have a positive impact on the Bank’s

overall cost of funds and facilitate lending at more competitive rates to its clients. The new

entity would offer various retail products, leveraging upon its existing relationship with retail

investors under its existing Suvidha Flexi-bond schemes.

The responsibility for maintaining standards of corporate governance lies with its Board of

Directors. Two Committees of the Board viz. the Executive Committee and the Audit

Committee are adequately empowered to monitor implementation of good corporate

55
governance practices and making necessary disclosures within the framework of legal

provisions and banking conventions.

Industrial Investment Bank of India Ltd.

The Industrial Investment Bank of India is one of oldest banks in India. The Industrial

Reconstruction Corporation of India Ltd., set up in 1971 for rehabilitation of sick industrial

companies, was reconstituted as Industrial Reconstruction Bank of India in 1985 under

the IRBI Act, 1984. With a view to converting the institution into a full-fledged development

financial institution, IRBI was incorporated under the Companies Act, 1956, as Industrial

Investment Bank of India Ltd. (IIBI) in March 1997. IIBI offers a wide range of products and

services, including term loan assistance for project finance, short duration non-project asset-

backed financing, working capital/ other short-term loans to companies, equity subscription,

asset credit, equipment finance as also investments in capital market and money market

instruments.

In view of certain structural and financial problems adversely impacting its long-term

viability, IIBI submitted a financial restructuring proposal to the Government of India on 25

July 2003. IIBI has since received certain directives from the Government of India, which,

inter alias, include restricting fresh lending to existing clients approved cases rated

corporates, restrictions on fresh borrowings, an action plan to reduce the overhead

expenditure, disposal of fixed assets and a time-bound plan for asset recovery/reconstruction.

The Government of India had also given its approval for the merger of IIBI with IDBI and

the latter had already started the due diligence process.

56
Acquisition of United Western Bank

In 2006, IDBI Bank acquired United Western Bank in a rescue. [11] Annasaheb Chirmule, who

worked for the cause of Swadeshi movement, founded Satara Swadeshi Commercial Bank in

1907, and some three decades later founded United Western Bank. The bank was

incorporated in 1936, and commenced operations the next year, with its head office in Satara,

inMaharashtra State. It became a Scheduled Bank in 1951. In 1956 it merged with Union

Bank of Kolhapur, and in 1961 with Satara Swadeshi Commercial Bank. At the time of the

merger with IDBI, United Western had some 230 branches spread over 47 districts in 9 states,

controlled by five Zonal Offices at Mumbai, Pune, Kolhapur, Jalgaon and Nagpur.

57
 INTRODUCTION TO

BANKING SECTOR IN INDIA

A bank is an institution that deals in money and its substitutes and provides other financial

services. Banks accept deposits and make loans or make an investment to derive a profit from

the difference in the interest rates paid and charged, respectively.

In India the banks are being segregated in different groups. Each group has their own benefits

and limitations in operating in India. Each has their own dedicated target market. Few of

them only work in rural sector while others in both rural as well as urban. Many even are

only catering in cities. Some are of Indian origin and some are foreign players.

India’s economy has been one of the stars of global economics in recent years. It has grown

by more than 9% for three years running. The economy of India is as diverse as it is large,

with a number of major sectors including manufacturing industries, agriculture, textiles and

handicrafts, and services. Agriculture is a major component of the Indian economy, as over

66% of the Indian population earns its livelihood from this area. Banking sector is considered

as a booming sector in Indian economy recently. Banking is a vital system for developing

economy for the nation.

58
 Hierarchy of Indian Banking System

Reserve Bank of India

Non-Schedule Banks
Schedule Banks
Central co-op
State co-op Commercial Banks and Commercial Banks
Banks Banks Primary Cr.
Societies
Indian Foreign

Public Sector
Banks Private Sector IDBI,
Banks ICICI etc.

State Bank of India Other Nationalized Regional Rural

and its Subsidiaries Banks Banks

59
 INDIAN BANKING SYSTEM

Without a sound and effective banking system in India it cannot have a healthy

economy. The banking system of India should not only be hassle free but it should be able to

meet new challenges posed by the technology and any other external and internal factors. For

the past three decades India's banking system has several outstanding achievements to its

credit. The most striking is its extensive reach. It is no longer confined to only metropolitans

or cosmopolitans in India. In fact, Indian banking system has reached even to the remote

corners of the country. This is one of the main reasons of India's growth process. The

government's regular poIDBI BANKy for Indian bank since 1969 has paid rich dividends

with the nationalization of 14 major private banks of India.

Not long ago, an account holder had to wait for hours at the bank counters for getting

a draft or for withdrawing his own money. Today, he has a choice. Gone are days when the

most efficient bank transferred money from one branch to other in two days. Now it is simple

as instant messaging or dial a pizza. Money has become the order of the day.

The first bank in India, though conservative, was established in 1786. From 1786 till

today, the journey of Indian Banking System can be segregated into three distinct phases.

They are as mentioned below:

 Early phase from 1786 to 1969 of Indian Banks

 Nationalization of Indian Banks and up to 1991 prior to Indian banking sector

Reforms.
 New phase of Indian Banking System with the advent of Indian Financial

& Banking Sector Reforms after 1991.

60
 After 1991, under the chairmanship of M Narasimham, a committee was set up by his

name which worked for the liberalization of banking practices. The country is flooded with

foreign banks and their ATM stations. Efforts are being put to give a satisfactory service to

customers. Phone banking and net banking is introduced. The entire system became more

convenient and swift. Time is given more importance than money. This resulted that Indian

banking is growing at an astonishing rate, with Assets expected to reach US$1 trillion by

2010.

“The banking industry should focus on having a small number of large players that

can compete globally and can achieve expected goals rather than having a large number of

fragmented players."

61
 KINDS OF BANKS
Financial requirements in a modern economy are of a diverse nature, distinctive

variety and large magnitude. Hence, different types of banks have been instituted to cater to

the varying needs of the community. Banks in the organized sector may, however, be

classified in to the following major forms:

o Commercial banks
o Co-operative banks
o Specialized banks
o Central bank

 COMMERCIAL BANKS

Commercial banks are joint stock companies dealing in money and credit. In India,

however there is a mixed banking system, prior to July 1969, all the commercial banks-73

scheduled and 26 non-scheduled banks, except the state bank of India and its subsidiaries-

were under the control of private sector. On July 19, 1969, however, 14 major commercial

banks with deposits of over 50 Corers were nationalized. In April 1980, another six

commercial banks of high standing were taken over by the government.

At present, there are 20 nationalized banks plus the state bank of India and its 7

subsidiaries constituting pubIDBI BANK sector banking which controls over 90 per cent of

the banking business in the country.

62
  CO-OPERATIVE BANKS

Co-operative banks are a group of financial institutions organized under the provisions of the

Co-operative societies Act of the states. The main objective of co-operative banks is to

provide cheap credits to their members. They are based on the principle of self-reliance and

mutual co-operation. Co-operative banking system in India has the shape of a pyramid a three

tier structure, constituted by:

 SPECIALIZED BANKS

There are specialized forms of banks catering to some special needs with this unique nature

of activities. There are thus,

o Foreign exchange banks,

o Industrial banks,
o Development banks,
o Land development banks,
o Exim bank.
 CENTRAL BANK

A central bank is the apex financial institution in the banking and financial system of a

country. It is regarded as the highest monetary authority in the country. It acts as the leader of

63
the money market. It supervises, control and regulates the activities of the commercial banks.

It is a service oriented financial institution.

India’s central bank is the Reserve Bank of India established in 1935. A central bank is

usually state owned but it may also be a private organization. For instance, the Reserve Bank

of India (RBI), was started as a shareholders’ organization in 1935, however, it was

nationalized after independence, in 1949. It is free from parliamentary control.

Major Players

FOREIGN BANKS IN INDIA

Major foreign banks in India are:

 ABN-AMRO Bank

 Abu Dhabi Commercial Bank Ltd.

64
  American Express Bank Ltd

 BNP Paribas

 Citibank

 DBS Bank Ltd

 Deutsche Bank

 HSBC Ltd

 Standard Chartered Bank

Nationalized Banks in India

List of PubIDBI BANK Sector Banks in India is as follows:

 Allahabad Bank

 Andhra Bank

 Bank of Baroda

 Bank of India

 Bank of Maharashtra

 Canara Bank

 Central Bank of India

 Corporation Bank

 Dena Bank

 Indian Bank

 Indian Overseas Bank

 Oriental Bank of Commerce

65
  Punjab and Sind Bank

 Punjab National Bank

 State Bank of Bikaner & Jaipur

 State Bank of Hyderabad

 State Bank of India (SBI)

 State Bank of Indore

 State Bank of Mysore

 State Bank of Patiala

 State Bank of Saurashtra

 State Bank of Travancore

 Syndicate Bank

 UCO Bank

 Union Bank of India

Private Banks in India

Major private banks in India are:

 AXIS BANK

 Bank of Rajasthan

 Bharat Overseas Bank

 CathoIDBI BANK Syrian Bank

 Centurion Bank of Punjab

 Dhanalakshmi Bank

66
  Federal Bank

 IDBI Bank

 ICICI Bank

 IDBI Bank

 IndusInd Bank

 ING Vysya Bank

 Jammu & Kashmir Bank

 Karnataka Bank

 Karur Vysya Bank

 Kotak Mahindra Bank

 SBI Commercial and International Bank

(Data Analysis & Interpretations)

67
68
 1. Duration for which the respondent has been working in IDBI BANK,

SITAPUR.

Table 1: Duration of work period in IDBI BANK, SITAPUR .

Particulars Percentage of respondents

0-1 yrs 3%
1-5 yrs 55%
5-10 yrs 25%
10+ yrs 17%
Total 100%
Chart 1: Duration of work in IDBI BANK, SITAPUR .

Interpretations

3 percent of the respondents are dealing with IDBI BANK, SITAPUR for less than a year. 55

percent of the respondents are dealing in IDBI BANK, SITAPUR from 1-5 yrs. 25 percent of

the respondents are dealing in IDBI BANK, SITAPUR from 5-10 yrs. 17 percent of the

respondents are dealing in IDBI BANK, SITAPUR for over 10 yrs.

2. Extent of satisfaction in setting goals/objectives in the beginning of the year.

Table 2: Extent of satisfaction

Particulars Percentage of

respondents

69
 Very satisfied 63%
Satisfied 30%
Dissatisfied 7%
Total 100%

Chart 2: Extent of satisfaction.

Interpretations

63 percent of the respondents are very satisfied in setting their goals and objectives in

the beginning of the year. 30 percent of the respondents are satisfied in setting their goals and

objectives in the beginning of the year. 7 percent of the respondents are dissatisfied in setting

their goals and objectives in the beginning of the year.

70
 3. Ratings of the PA strategies and programmes in the company.

This question was asked to the employees of IDBI BANK, SITAPUR to rate the standard of

various PA strategies and programmes that take place in the organization.

Table 3: Ratings of PA strategies.

Particulars Percentage of respondents

Good 70%
Average 30%
Bad 0%
Total 100%

Chart 3: Ratings of PA strategies.

Interpretations

70 percent of the respondents rate the Performance Appraisal strategies as good. 30 percent of

the respondents rate the Performance Appraisal strategies as average. None of the

respondents rates the Performance Appraisal strategies as bad.

4. Performance Appraisal strategies are fair and objective.

71
This question was asked to the employees to know if the performance appraisal strategies are

fair and objective to the employees.

Table 4: PA strategies are fair or not.

Particulars Percentage of respondents

Yes 84%
No 16%
Can’t say 0%
Total 100%

Chart 4: PA strategies are fair or not.

Interpretations

84 percent of the respondents say that the Performance Appraisal strategies are fair and

objective. 16 percent of the respondents say that the Performance Appraisal strategies are not

fair and objective. None of the respondents are there who can’t say anything.

5. It is necessary to appraise an employee.

This question was asked to the employees to know how important it is to appraise an

employee.

72
 Table 5: Necessity to appraise an employee.

Particulars Percentage of respondents

Yes 100%
No 0%
Total 100%

Chart5: Necessity to appraise an employee.

Interpretations

100 percent of the respondents say that it is necessary to appraise an employee. None of the

respondents says that it is necessary to appraise an employee.

73
 6. There is clarity in what is expected from the employee.

This question was asked to the employees to know if they are made clear on what is expected

of them so that they can work accordingly.

Table 6: Clarity in what is expected from the employee.

Particulars Percentage of respondents

Yes 100%
No 0%
Total 100%

Chart 6.: Clarity in what is expected from the employee.

Interpretations

100 percent of the respondents say that they are clear with what is expected of them. None of

the respondents say that they are not clear with what is expected of them.

7. Feedback is given to the Management Cadre Staff for the task

accomplished by them.

74
This question was asked to the employees to know if they are provided with proper feedback

for the task they accomplish, based upon which they can work better in future.

Table 7: Feedback is given to MCS.

Particulars Percentage of respondents

Yes 62%
No 38%
Total 100%

Chart 7: Feedback is given to MCS.

Interpretations

62 percent of the respondents say that the feedback is given to the MCS for the task

accomplished by them. 38 percent of the respondents say that the feedback is not given to the

MCS for the task accomplished by them.

8. Suggestions and innovations are rewarded.

Table 8: Suggestions and innovations are rewarded.

Particulars Percentage of respondents

Yes 35%
No 65%
Total 100%

75
 Chart 8: Suggestions and innovations are rewarded.

Interpretations

35 percent of the respondents say that their suggestions and innovations are rewarded. 65

percent of the respondents say that their suggestions and innovations are not rewarded.

9. Supervisors take interest in sharing an employee’s personal concern.

Table 9: Supervisors share an employee’s personal concern.

Particulars Percentage of respondents

Yes 72%
No 28%
Total 100%

76
 Chart 13: Supervisors share an employee’s personal concern.

Interpretations

72 percent of the respondents say that the supervisors take interest in sharing their personal

concern. 28 percent of the respondents say that the supervisors do not take interest in sharing

their personal concern.

10 Annual increments/promotions are based on performance.

This question was asked to the employees to know if the annual increments/promotions are

based on their performance or not.

Table 10: Increments & promotions based on performance.

Particulars Percentage of respondents

Yes 82%
No 15%
Can’t say 3%

77
 Total 100%

Chart 10: Increments & promotions based on performance.

Interpretations

82 percent of the respondents say that the annual increments/promotions are based on their

performance. 15 percent of the respondents say that the annual increments/promotions are not

based on their performance. 3 percent of the respondents can’t say or their answers are

inapplicable.

11. Extent of satisfaction in interdepartmental teamwork.

This question was asked to the employees to know the extent of satisfaction in

interdepartmental teamwork based on which their effectiveness in work can be known.

Table 11: Satisfaction in inter departmental team work.

Particulars Percentage of respondents

Very satisfied 28%

Satisfied 50%
Dissatisfied 22%
Total 100%

78
 Chart 11: Satisfaction in inter departmental team work.

Interpretations

28 percent of the respondents are very satisfied with interdepartmental teamwork. 50 percent

of the respondents are just satisfied with interdepartmental teamwork. 22 percent of the

respondents are dissatisfied with interdepartmental teamwork.

12. Extent of help of training and development programmes in improving

employees’ performance.

This question was asked to the employees to know how far the training and development

programme is helping the employees to learn and work better.

Table 12:

Particulars Percentage of respondents

To great extent 22%
To some extent 70%
To very little extent 8%
Total 100%

79
 Chart 12:

Interpretations
22 percent of the respondents say that the training and development programmes help to a
great extent to improve their performance. 70 percent of the respondents say that the training
and development programmes help to some extent to improve their performance. 8 percent of
the respondents say that the training and development programmes help to a very little extent
to improve their performance.

13. Performance Appraisal System is used in job rotation.

This question was asked to the employees to know the extent of use of performance appraisal

system in job rotation.

Table 13:

Particulars Percentage of respondents

Mostly 12%
Partially 88%
Nil 0%
Total 100%

80
 Chart 13:

Interpretations

12 percent of the respondents say that performance appraisal system is mostly used in job

rotation. 88 percent of the respondents say that performance appraisal system is partially used

in job rotation. None of the respondents say that performance appraisal system is not at all

used in job rotation.

14. Extent of the purpose of performance appraisal system being fulfilled.

Table 14:

Particulars Percentage of respondents

Completely 65%
Partially 35%
Total 100%

81
 Chart 14:

Interpretations

65 percent of the respondents say that the purpose of performance appraisal is completely

fulfilled. 35 percent of the respondents say that the purpose of performance appraisal is

partially fulfilled.

82
 15. IDBI BANK, SITAPUR always strives for continuous individual improvements.

This question was asked to the employees to know how far they agree with the fact that IDBI

BANK, SITAPUR always strives for continuous individual improvements.

Table 15:

Particulars Percentage of respondents

Strongly agree 22%
Agree 58%
Disagree 15%
Strongly disagree 5%
Total 100%

Chart 15:

Interpretations
22 percent of the respondents strongly agree that IDBI BANK, SITAPUR always strives for
continuous individual improvements. 58 percent of the respondents agree that IDBI BANK,
SITAPUR always strives for continuous individual improvements. 15 percent of the
respondents disagree that IDBI BANK, SITAPUR always strives for continuous individual
improvements. 5 percent of the respondents strongly disagree that IDBI BANK, SITAPUR
always strives for continuous individual improvements.

83
Findings

84
 Findings

From the Analysis following findings were drawn

1. Mostly Employees are working in IDBI Bank from 1-5 yrs.

2. Mostly Employees are very satisfied in setting their goals and objectives in the

beginning of the year

3. Mostly Employees rate the Performance Appraisal strategies as good

4. Mostly Employees say that the Performance Appraisal strategies are fair and objective

5. Mostly Employees agree that it is necessary to appraise an employee

6. Mostly Employees agree that they are clear with what is expected of them. None of

the employees agree that they are not clear with what is expected of them.

7. Mostly Employees agree that the feedback is given to the MCS for the task

accomplished by them.

8. Mostly Employees agree that their suggestions and innovations are rewarded

9. Mostly Employees agree that the supervisors take interest in sharing their personal

concern

10. Mostly Employees agree that the annual increments/promotions are based on their

performance

11. Mostly Employees agree that they are very satisfied with interdepartmental

teamwork.

12. Mostly Employees agree that the training and development programmes help to a

great extent to improve their performance. 70 percent of the employees say that the

training and development programmes help to some extent to improve their

performance

85
13. Mostly Employees agree that performance appraisal system is partially used in job

rotation.

14. Mostly Employees agree that the purpose of performance appraisal is completely

fulfilled

15. Mostly Employees agree that IDBI BANK, SITAPUR always strives for continuous

individual improvements

86
Conclusion

87
 Conclusion

• Performance management is the process through which managers ensure that

employees’ activities and outputs contribute to the organization’s goals.

• Organizations establish performance management systems to meet three broad

purposes:

– Strategic purpose

– Administrative purpose

– Developmental purpose

• Performance measures should fit with the organization’s strategy by supporting its

goals and culture.

• Performance information may come from an employee’s self-appraisal and from

appraisals by the employee’s supervisor, employees, peers, and customers.

• Using only one source makes the appraisal more subjective.

• Organizations may combine many sources into a 360- degree performance appraisal.

• Organizations can minimize appraisal politics by establishing a fair appraisal system,

involving managers and employees in developing the system, allowing employees to

challenge evaluations, communicating expectations, and having open discussion.

• Performance feedback should be a regular, scheduled management activity, so that

employees can correct problems as soon as they occur.

• The performance feedback discussion should focus on behavior and results rather than

on personalities.

88
• Managers must make sure that performance management systems and decisions treat

employees equally, without regard to their race, sex, or other protected status.

• A system is more likely to be legally defensible if it is based on behaviors and results,

rather than on traits, and if multiple raters evaluate each person’s performance.

89
Suggestions

90
 Suggestions

There are differences among organizations, the performance appraisal is

the formal tool with which bosses and management assess employees. However, it’s also wise

to understand the informal process or how your organization’s political culture works. That

way, you’ll understand the entire picture. For example, when you grasp both processes, you’ll

know why some people get ahead faster than others—even if both individuals have excellent

performance appraisal interviews or reviews.

Tips on anticipating questions and how you’d respond: Once you’ve assessed your boss’

perspective, you’ll be able to anticipate the majority of questions that he’d ask and also

prepare the gist (main point) of your replies.

Identify areas for improvement: If you’ve anticipated your boss’ mindset, you’ll know the

areas in which you need to improve. That way, you’ll be ready—and willing—to discuss

these needs with your boss.

Develop next steps: While you’re preparing for your meeting, think about specific ways in

which you could enhance your performance.

Follow up with boss: Throughout the year, periodically follow up by email or in person with

your boss. Let him know how you’re progressing with your self-improvement plan. That way,

your next performance appraisal will be successful.

91
Limitations of the study

92
 Limitations of the study

 The study is focused on a very general level rather than a full scale detailed report.

 The study does not get information from an in depth prospective.

 The study is not necessarily the solution to the problem that exists.

 There were a lot of breaks and hindrances while the study took place.

 The feedback given by recipients is not necessarily right.

93
BIBLIOGRAPHY

94
 BIBLIOGRAPHY

Books:-

 Kothari C R. “Research Methodology-Methods & Techniques”-2nd revised edition

(2007) New Age International Publishers- New Delhi. (pg 199-213)

 Aswathappa K, “Human Resource and Personnel Management – Text and Cases”,

Tata McGraw Hill, 2007 (pg 151-189).

 VSP Rao, “Human Resources Management Text and Cases”, Excel Books, 2010(pg

160-199).

 Gary Dessler, “Human Resource Management”, Prentice Hall of India, New Delhi,

2009 (pg 252-471).

 Tripathi. A. N., “Human Values”, New Age International Pvt. Ltd., New Delhi, 2002

(pg 504-541).

Websites:-

 www.managementparadise.com

 www.humanresourcemanagement.com

 www.en.wikipedia.org

 www.mbastudymaterial.com

 www.IDBI.co.in

95
ANNEXURE

96
 ANNEXURE

Questionnaire on Performance Appraisal for

Appraises and appraisers

(Tick your choice)

Name of the respondent:

Address : Phone no. :

1) Since how long have you been working in IDBI BANK, SITAPUR ?

□ 0-1 yrs □ 1-5 yrs □5-10 yrs □10+ yrs

2) How satisfied are you in setting your goals and objectives in the beginning of the

year?

□ Very satisfied □ Satisfied □ Dissatisfied

3) How are the Performance Appraisal strategies and programmes in the company

□ Good □ Average □ Bad

4) Do you consider Performance Appraisal strategies fair and objective?

□ Yes □ No □ Can’t say

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5) Is it necessary to appraise an employee?

□ Yes □ No

6) Are you clear with what is expected of you?

□ Yes □ No

7) Are the Management Cadre Staff provided with regular performance feedback?

□ Yes □ No

8) Are your suggestions and innovations rewarded?

□ Yes □ No

9) Do your supervisors take interest in sharing your personal concern?

□ Yes □ No

10) Are your annual increments/promotions based on your performance?

□ Yes □ No □ Can’t say

11) How satisfied are you in interdepartmental teamwork?

□ Good □ Average □ Bad

12) To what extent do training and development programmes help in improving your

performance?

□ To great extent □ To some extent □ To very little extent

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13) How far is the Performance Appraisal system used for job rotation?

□ Mostly □ Partially □ Nil

14) To what extent is the purpose of Performance Appraisal fulfilled?

□ Completely □ Partially □ Nil

15) Does IDBI BANK, SITAPUR always strive for continuous individual improvement?

□ Strongly agree □ Agree □ Disagree

□ Strongly disagree

Date:

Place: Signature

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