PERFORMANCE APPRAISAL SYSTEM OF EASTERN BANK LIMITED

REVIEW OF PERFORMANCE APPRAISAL SYSTEM OF EASTERN BANK LIMITED  Preface In the beginning, “Performance Appraisal” systems began as simple methods of income justification. That is, appraisal was used only to decide whether or not the salary or wage of an individual employee was justified. Thus if an employee's performance was found to be less than ideal, there was a decrease in salary. On the other hand, if their performance was better than the supervisor expectation, 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. But early motivational researchers were not aware of one thing. That is, pay rates were important, but they were not the only element that had an impact on employees’ performance. It was found that other issues, such as morale and self-esteem or power to provide authority could also have a major influence. As a result, the traditional emphasis on reward outcomes was progressively rejected. Recently, 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.  Table of Contents Executive Summary --- --- --- --- --- --- --- --- --- --- --- --- --- 04 Chapter-1: Introduction --- --- --- --- --- --- --- --- --- --- --- --- --- 05 Introduction --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- 06 Purpose of the Study --- --- --- --- --- --- --- --- --- --- --- 07 Scope of the Study --- --- --- --- --- --- --- --- --- --- --- --- --- --- 07 Methodology of the Assignment --- --- --- --- --- --- --- --- --- 08 Limitation of the Assignment --- --- --- --- --- --- --- --- --- 08 Chapter-2: Company Profile --- --- --- --- --- --- --- --- --- --- --- 09 Formation --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- 10 Mission --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- 10 Vision --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- 10 Area, Size & Activities --- --- --- --- --- --- --- --- --- --- --- 10 Financial Position --- --- --- --- --- --- --- --- --- --- --- --- --- 11 Organizational Structure --- --- --- --- --- --- --- --- --- --- --- 11 Chapter-3: Existence practice of Performance Appraisal System 13 Application in the work place of performance appraisal --- 14 Objective of Performance Appraisal --- --- --- --- --- --- 15 Performance Appraisal Basics --- --- --- --- --- --- --- --- --- 16 Sources of Performance Appraisal --- --- --- --- --- --- --- 18 The Reward System --- --- --- --- --- --- --- --- --- --- --- 19 Performance Appraisal Techniques --- --- --- --- --- --- --- 22 Chapter-4: Evaluation of existing practice --- --- --- --- --- --- --- 23 Chapter-5: Recommendation & Conclusion --- --- --- --- --- --- --- 25 Recommendation --- --- --- --- --- --- --- --- --- --- --- --- --- --- 26 Conclusion --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- 26 References & Acknowledgement --- --- --- --- --- --- --- --- --- 27 Interview Questions --- --- --- --- --- --- --- --- --- --- --- --- --- --- 28 Executive Summary Performance Appraisal is the procedure that involves in setting work standards, assessing the employee’s actual performance relative to those standards and providing feedback to the employee with the aim of motivating him or her to eliminate performance deficiencies or to continue to perform above par. In today’s competitive business world only hard work cannot provide maximum productivity, it needs employees’ capability to work smarter which guarantees that the organization will achieve its potentiality. We have selected the company ‘Eastern BANK LTD.’, in an intention to study on Human Resource Management regarding review of performance appraisal system. With a vision to become the bank of choice and to be the most valuable financial brand in Bangladesh, Eastern Bank Ltd. (EBL) began its journey in 1992. Over the years EBL has established itself as a leading private commercial bank in the country. The management of Eastern Bank Ltd. is very serious about the current performance of the employees and provides all necessary supports to them. The managers tend to overlook the employees traits and personal weaknesses on most occasion. The Eastern Bank Limited presently follows the rating system. They try to reward the employees to the basis of their performance. On the half year and the year end they are being reviewed by their reporting line managers. There is no scope for the subordinates to appraise performance of their superiors. Eastern Bank Ltd. even does not allow any kind of self-appraisal by the employee himself. Another deviation from theory is in their performance appraisal technique. Though there are both individual and comparative evaluation systems, Eastern Bank Ltd. use only the individual rating system. Among the different individual rating system, they use mainly the graphic-rating scales only. Despite of some limitation, Eastern Bank Ltd. has an effective appraisal system by which they are monitoring the contribution of the employees and taking necessary remedial action to achieve the desired result.  CHAPTER – 1 Introduction  In today’s competitive business world only hard work cannot provide maximum productivity, it needs employees’ capability to work smarter which guarantees that the organization will achieve its potentiality. While it is true that a sound education and appropriate skill training are needed if one is to work smarter, the process does not end there. Today’s employees need instructive and supportive appraising followed by feedback and desired reward if they are to translate their knowledge into improved productivity and superior quality. Productivity is a function of the ways in which monetary, technical and human resource are managed. While monetary and technical resources can be managed by specialties in finance, accounting and engineering, the management of human resource is responsible for all those who supervise others. In order to develop human resource with an eye towards maximizing productivity, it is essential that supervisors periodically assess the performance of each subordinate because performance appraisals are done with the goal of maintaining or improving performance. Performance appraisals provide subordinate with useful feedback about how they are doing in their jobs. Virtually all employees want to know how their superiors view their performance. Superiors can encourage employees towards better performance by providing them proper feedback and effective incentive system. “Performance appraisal is the process by which a manager evaluates an employee’s work behaviors by measurement and comparison with established standards, records the results, and communicates them to the employee”. -(Griffin, 1992) From going through above definition now the performance appraisal can be defined as a kind of control system that can be used with management by objectives. Also performance appraisal serves in developmental purpose for members of an organization. When managers regularly evaluate their subordinates’ performance, they can provide subordinates with valuable information about their strengths and weaknesses and areas in which they need to concentrate. Purpose of the Study During the 4 months long semester of MBA program of East West University, we are required to do a Group Assignment in the course Human Resource Management (HRM-501). This course is designed to give the business students an understanding of principles of Human Resource Management concept of an organizational set up. We have chosen a company ‘Eastern BANK LTD.” for our assignment. By the selection of the company ‘Eastern BANK LTD.’, we have the intention to study on Human Resource Management regarding performance appraisal. Scope of the Study Performance appraisals are systematic ways of measuring, reviewing and analyzing employee performance over a given period of time and using the information gathered to plan for the employee's future with the organization. This periodical, impartial feedback is used to judge employee effectiveness as well as provide necessary development and training to improve the employee's contributions to the organization's goals. Employees are the most significant resource of any business, and performance appraisals reflect the organization's commitment in developing this important resource of human capital. Performance appraisals grant upper management an opportunity to reward excellent performance or reprimand unsatisfactory performance. This powerful managerial tool should directly reflect the overall organization's goals and objectives; the employee assessment should provide useful feedback about the employee's contributions or lack of contributions toward these goals. Methodology of the Assignment While preparing this report, we were very much strict on correct information, data collection of managerial style practice and performance analysis. Using all these, we tried our best to accomplish objectives. The report is originated from both primary and secondary data source. Primary data: Face to face conversation with employees. By arranging appointment with top officials of the company. Secondary data: Company’s brochure. Company’s website. Limitation of the Assignment The scope is limited to the strategy formulation, evaluation and implementation. There was a great difficulty of finding appointment of the top officials of EBL. Although talking to the officials interviewing few personnel of different level of HR Department and top level management and talking to personal references was helpful, still we could not cover in depth analysis on the above-mentioned topic. Getting relevant papers, documents and information were strictly prohibited. To protect the organizational loss in regard of confidentiality some areas of the report are not in depth. Restriction on time and resources of data.  CHAPTER – 2 Company Profile  Formation of Eastern Bank Ltd. With a vision to become the bank of choice and to be the most valuable financial brand in Bangladesh, Eastern Bank Ltd. (EBL) began its journey in 1992. Over the years EBL has established itself as a leading private commercial bank in the country with undisputed leadership in Corporate Banking and a strong Consumer and SME growth engines. EBL’s ambition is to be the number one financial services provider, creating lasting value for its clientele, shareholder, employees and above all for the community it operates in. Mission of Eastern Bank Ltd. Deliver service excellence to all the customers, both internal and external. Ensure to maximize shareholders' value. Constantly challenging systems, procedures and training to maintain a cohesive and professional team in order to achieve service excellence. Create an enabling environment and embrace a team based culture where people will excel and also ensure to maximize shareholder's value. Vision of Eastern Bank Ltd. To become the bank of choice by transforming the way they do business and developing a truly unique financial institution that delivers superior growth and financial performance, and are the most recognizable brand in the financial services in Bangladesh. Area, Size and Activities of Eastern Bank Ltd. Bangladesh Banking Sector has grown from strength to strength over the past one decade and is fiercely competitive, especially in the Consumer Banking segment. EBL offers a wide range of depository, loan and card products to cater virtually for every customer segment. From Student Banking to Priority Banking to Platinum card EBL has almost all banking products in its repertoire. The product basket is rich in content featuring different types of Savings & Current Accounts, Personal Loans, Debit Cards, Credit Cards, Pre-paid Cards, Internet Banking, Corporate Banking, SME Banking, Investment Banking, Treasury & Syndication services. The customers are served through a network of 39 Branches, 62 ATMs and 5 Kiosks countrywide. EBL has its presence in 11 major cities/towns in the country including Dhaka, Chittagong, Sylhet, Khulna, Rajshahi & Cox’s Bazar. Financial Position of Eastern Bank Ltd. EBL believes in relationship building and focuses on sustainable and long term growth – both for the bank, its clients and the community it operates in. Despite the constant threat of the global economic recession and its subsequent effect on the Bangladesh market in 2009, EBL's Profit after tax grew by 84% last year. The Non Performing Loan Ratio dropped to 2.46% from 3.30%. The same year, Earning per Share (EPS) had increased by around 70% and Cost to Income ratio remained 35.64% which is one of the lowest in the industry. And in 2010 the bank's Credit Rating increased to AA from AA-, which was A+ in the year before. Organizational Structure of Eastern Bank Ltd. The EBL Management Team or Management Committee (ManCom) comprises of a group of eleven people and each of them comes with an international working background and are committed in leveraging their experiences to take EBL to greater heights by ensuring top line revenues with dynamic capabilities. EBL ManCom is unique in being able to envision the need of the business by bringing in a mixture of advanced technology solutions know-how and revamping the organizational make- up for maximum profitability. Other than the MD & CEO, the remaining ManCom Members each head a function viz. Consumer & SME Banking Corporate Banking Credit Finance Human Resources Information Technology Operations This mix of people is persistent to provide unparallel service to its customers, come up with timely and innovative products and services and to enhance the capabilities of its people while emphasizing on the latest technology. This they believe will take the Bank to a leadership position in the country.  CHAPTER – 3 Existing Practices of Eastern Bank Ltd. with regard to Employee Performance Appraisal system  Application in the work place of performance appraisal The Appraisal Philosophy The modern appraisal philosophy states that the managerial emphasis should be on the performance of the employees and the future goals of the organization, rather than on the employee traits, deficiencies and abilities. Eastern Bank Ltd. (EBL) strictly believes in this philosophy. The management of Eastern Bank Ltd. is very serious about the current performance of the employees and provides all necessary supports to them. The managers tend to overlook the employees traits and personal weaknesses on most occasion. This appraisal philosophy is a relative phenomenon and therefore varies from organization to organization. Eastern Bank Ltd. follows the following four steps: 1. Performance orientation The managers of Eastern Bank Ltd. are performance oriented. They evaluate employees by the outcome (profit, reputation and service) that they generate. 2. Focus on goals and objectives The managers of Eastern Bank Ltd. facilitate a complete ‘learning-session’ to educate the employees on how to accomplish the task effectively and efficiently. Thus the employees get to know both the task and the possible ways to do that and can focus on the goals and objectives that they are supposed to achieve currently and in future. 3. Mutual goal setting Both the employees and managers of Eastern Bank Ltd. sit together and decide the future goals for the bank. This meeting holds on the branch-basis. Thus, each branch comes up with its own goals. Then the branch managers again sit together and do the necessary corrections. 4. Extensive feedback system The feedback is provided usually after the end of a task in Eastern Bank Ltd. Moreover, an annual feedback also is provided, which has the criteria such as outcome, time management, group relationships and crisis management. The Appraisal Interview The management of Eastern Bank Ltd. provides the feedback in a formal session with each individual employee. This session works as the appraisal interview. This appraisal interview holds in two steps: An employee faces it after the end on a significant task and again at the end of the year. In both cases, the managers provide an extensive feedback, which includes evaluation of past performance, problem solving etc. The manager also asks for input and opinion on new projects of Eastern Bank Ltd. Performance Appraisal System Performance appraisal system (PAS) comprises the organizational processes and activities involved in performance appraisals, including organizational policies, procedures and resources that support the activity. Eastern Bank Ltd. has a definite performance appraisal system of its own. Objective of Performance Appraisal Performance appraisal may serve as many as twenty different purposes, but the most basic is to provide information about work behaviors. Eastern Bank Ltd. has done a wonderful job in fulfilling the purpose of performance appraisal by providing information about their employee behaviors and connecting those to their employees regularly. Other purposes of performance appraisal of Eastern Bank Ltd. are to label as Judgmental and Developmental orientation. Judgmental orientation focuses on past performance and is concerned mainly with the measurement of performance and also with the uses of information generated. They use this part to control behavior, rewarding desired behaviors with wage raises, promotions, and entrance into high-potential employee development programs and warn undesired behaviors and sometimes take actions like transfers and layoffs or denial in wage increases. On the other hand, when Eastern Bank Ltd. uses performance appraisal for developmental purpose, they focus on future performance and use the information resulting from evaluations for performance improvement. If improved future performance is the intent of the appraisal process, the manager then can focus on goals or targets for the employee, elimination of obstacles or problems that hinder performance, and future training needs. Performance Appraisal Basics There is no one way to perfect a performance appraisal system, but Eastern Bank Ltd. believes that there are three factors which are crucial to the success of their performance appraisal: Commitment to objectives, job analysis, and measurement. Commitment to Objectives A successful performance appraisal system is based on strong commitment from the entire organization, especially top management. This commitment is made manifest in the objectives of the performance appraisal system. Eastern Bank Ltd. management is very conscious about this and they communicate their objectives to those responsible for developing and managing the system, as well as to all employees covered by system. Clear objectives and strong organizational commitment give everyone in the organization confidence that the time and effort they devote to performance evaluation is worthwhile and give employees more interest in using the evaluations to change behaviors and improve performance. Job Analysis The second element of Eastern Bank Ltd. performance appraisal system is a sound job analysis system that provides comprehensive and accurate descriptions of all jobs in the organization. They define their job precisely and clearly so that an employee’s job performance can be evaluated fairly. Because the job analysis method used is a major determinant of the structure of the pay system that results, management is very careful in selecting the proper job analysis techniques that suits the situation most. Measurement of Performance The management of Eastern Bank Ltd. believes that the foundation of a good performance measurement system is the method by which performance is measured. It helps managers with information necessary for making decisions such as salary adjustment, promotion, transfer and training. They believe that the measurement systems used in performance appraisals must be valid, reliable, and free of bias and must not produce ratings that are constantly too lenient or too severe that bunch up in the middle. They must also be free of halo and timing errors. These factors for the success of Eastern Bank Ltd. measurement program are discussed briefly below: Validity According to Fred Kerlinger, when we question the validity of a measure, we are asking whether it measures what we think it measures. Validity is the extent to which a method of measurement accurately reflects the object or characteristic being measured. Reliability To make sure that the results of their measurement system are consistent, Eastern Bank Ltd. tries to make it reliable. If the same performance is measured several times in the same way and the results are very similar, the measurement can be called reliable. Generally, the reliability is high for the Eastern Bank Ltd., showing consistent result from the very beginning of its journey. Freedom from bias Bias is a personal preference or indication that hinders impartial judgment, as in a prejudice for or against some person or group of people based on race, age, sex, seniority, or the like. However, the performance measurement system used by Eastern Bank Ltd. seems to be free from biasness. They generally use more than one evaluator so there is a less possibility of biasness. Restriction of range Leniency, severity, and central-tendency problems in performance evaluation are special cases of the tendency of some raters to restrict the range of ratings they use. In each of these situations, the rater is unable to distinguish between different performance levels. In their performance appraisal system, Eastern Bank Ltd. tries to minimize the problems occurred by the restriction of range by giving proper briefing to the rater or the evaluator. Halo error As other organizations performance appraisal techniques, Eastern Bank Ltd. performance appraisal technique is not also free of halo error. It occurs when a rater consistently assigns the same rating to all aspects of a person’s performance, regardless of the actual performance level, because the raters’ impression of the person. Several factors, such as personal feelings and prior expectations, can result in halo errors of ratings. Halo error distorts performance appraisal system information and, like other problems of measurement, may compromise the objectives of the performance appraisal system. Timing errors Timing has a major impact on Eastern Bank Ltd. performance appraisal technique. In general, evaluations made immediately following the performance are more accurate. But as the bank mainly formally performs performance evaluation once a year, this delay between performance and rating can sometimes result in significant rating errors. A related timing problem, regency error also occurs in such situations when the rater remembers only the most recent behaviors of in evaluating an employee. Sources of Performance Appraisal There are a number of perspectives from which to access one’s performance. The immediate supervisor, the individual himself, by peers or coworkers, by subordinate or by some other sources of appraisal, can appraise performance. However, Eastern Bank Ltd. has the following of them: Division and Branch Manager In Eastern Bank Ltd., the division and the branch managers are the major sources of performance appraisal. They are given the responsibility to look over the employees performance and are responsible for the annul evaluation of the employees of the bank. They present the Annual Confidential Report (ACR) at the end of the year that is the measurement of performance of the employees. The Immediate Supervisor Generally, in every organization, it is the immediate supervisor who is in the best position to observe each individual. In Eastern Bank Ltd., the immediate boss is also believed to be a good source of performance appraisal. Furthermore, it is the immediate supervisor’s responsibility to direct the behavior of subordinates. However, sometimes it has been found that the supervisors are often not in the best position to observe subordinates; they may actually spend most of their time on other activities. Peer and Coworker Peers are frequently able to observe a given subordinate for a given period of time and a wider variety of situations than is an immediate supervisor. As one result of this greater contact, peers are likely to generate more accurate assessments and predictions of each other’s performance. However, Eastern Bank Ltd. rarely uses this source of performance appraisal. Other Sources In addition to the managers and supervisors, people outside the immediate work unit are sometimes asked to assist in performance appraisal. Though it could include customer, clients, external consultant or group of consultants, in Eastern Bank Ltd.’s case, it is seen to be the consultant only. Because of the inherent cost, this practice is usually limited to the evaluation of higher-level managers in Eastern Bank Ltd. The Reward System of Eastern Bank Limited The Eastern Bank Limited presently follows the rating system as we know from the above discussion. They try to reward the employees to the basis of their performance. On the half year and the year end they are being reviewed by their reporting line managers. At the starting of the year the employees are being asked to setup their performance objectives, the mangers reviews that and brings some changes is required or else approves the performance objectives. At the end of the year the managers reviews the performance objectives and tries to see how far the employee had been able to achieve the objectives setup for him. The mangers have a face to face interview with the employee and tell his drawbacks and on the other hand motivate him also on that meeting. The employee is then being rated on a scale of 1 to 5. “1” means that the employee’s performance was superior to the performance of the other employees, which on the other hand also means that he is well far ahead on performance comparing with other employees. “2” means that the performance of the employee is a bit more satisfactory than the performance of the other employees on his area of work. “3” means that the performance of the employees of average and he is doing quiet so comparing with his colleagues. “4” interprets that the performance of the employee is lacking behind that the performance of the other colleagues in his area of work. “5” means that if he doesn’t improve his performance of work within a short time he will be “fired”, on the other hand he is not capable to work in this situation and in that area of work. The employees are than rewarded on the rewarded on the basis of their rating scale, and the managers try to bring out the best from the “2” and “1” rated employees by offering them the changes of training and the other social benefits. In a nut shell managers motivates them more and gives them the room to perform more and help the other under performer to perform good. There are two time in a year when the “Promotion” season comes, one is during the time of March and April; other one is at the time of August and September. During this time of the year the employees are promoted to the higher posts based on their performance. This basically happens after the performance appraisal of the Half-year and the Year end. The March and the April is the favorite month of the employees because within this time the employees are being rewarded monetarily from the profit that EBL has done through out the year. The rate “1” employees are given 6 times of their gross salary as a bonus, which on the other hand comes with a promotion also. The “2” rated are given around 4 times their gross salary as a performance bonus and it may also come with a promotions. The “3” rated are given around 2/3 times their gross salary. The “4” rated are given around 1/2 times their gross salary. The reward system of EBL is some kind like being described above, but at times it varies. The variation comes at the yearly performance bonus system, other than that the process is still now constant through out the bank and at every level of the bank. Performance Appraisal Techniques of Eastern Bank Ltd For evaluating performance of their employees, Eastern Bank Ltd. use different type of appraisal techniques that minimizes conflict with rates provides relevant feedback to rates and contributes to the organization goals. Mainly they evaluate employees individually once a year in the form of ACR (Annual Confidential Report) that is a combination of different individual performance evaluation techniques. They also use the multiple rater comparative evaluation method to prepare their ACR. Immediate Evaluation Individual performance appraisal techniques vary greatly among organizations. The techniques used by Eastern Bank Ltd. are the following: Graphic rating scale As the oldest and most widely used performance evaluation procedure, the scaling technique covers the most portion of the annual confidential report. In Eastern Bank Ltd., the branch manager and division managers choose some criteria that describe job performance qualities and characteristics those are to be rated. Each quality can be given the value from 1 to 5. The rating scale are distinguished by (1) how exactly the categories are defined, (2) the degree to which the person interpreting the ratings can tell which response was intended by the rater, and (3) how carefully the performance dimension is defined for the rater. This method of performance appraisal suffers from some of the measurement problems such as the central tendency problem or the halo error. Another weakness is that this graphic rating scale provides little information that can be used for employee development and performance improvement. Descriptive essay Eastern Bank Ltd. has recently introduced the descriptive essay method of performance evaluation. It requires the rater to describe or write essay describing employee behaviors, specially their strong and weak points. Last year each employee’s division manager described employees’ behavior that was a portion in ACR written. These essays is generally based on the rater’s memory or on a diary of critical incidents that the rater keeps during the period covered by the evaluation. One limitation of the descriptive essay evaluation is that it provides little opportunity to compare rates on specific performance dimensions. Management by objectives Management by objectives (MBO) is one of the main criteria of evaluating employees in Eastern Bank Ltd. It measures task outcomes rather than behaviors. Eastern Bank Ltd. has a dynamic MBO system of its own. Each employee of the company has given a specific goal or target deposit each year. Then the superiors are monitoring them. If they can fulfill that target, they are given proper feedback in the form of increment in salary. However, as performance goals differ for each employee, results cannot easily be compared. In addition, the mechanics of MBO system- the cycle of goal setting, discussion, reporting and review- demand a considerable amount of team and paperwork for the bank. Multiple-Rater Comparative Evaluation Multiple-rater comparative evaluation methods are combination of several evaluation methods. The annual confidential report that Eastern Bank Ltd. uses for performance appraisal is a multiple-rater comparative evaluation system. To avoid the problem of central tendency and halo error, they use more than one rater, generally the branch manager and the division managers. They also use a comparison to reflect performance difference among employees.  CHAPTER – 4 Evaluation of existing practice  Difference between Theory and Real Scenario One major difference that can be seen in Eastern Bank Ltd. (EBL) is their use of the sources of performance appraisal. There is no scope for the subordinates to appraise performance of their superiors. Eastern Bank Ltd. even does not allow any kind of self-appraisal by the employee himself. Another deviation from theory is in their performance appraisal technique. Though there are both individual and comparative evaluation systems, Eastern Bank Ltd. use only the individual rating system. Among the different individual rating system, they use mainly the graphic-rating scales only. They do not use the BARS, weighted checklist or forced choice to evaluate performance.  CHAPTER – 5 Recommendation & Conclusion  Recommendation & Solution of Performance Appraisal of Eastern Bank Ltd Eastern Bank Ltd. should encourage its subordinates to appraise performance of their superiors so that the superiors are able to determine their best and worst activities and able to recover their problems. Among the different types of performance appraising rating systems Eastern Bank Ltd. use only the individual rating system. They should also use comparative rating system to make the performance appraising system more effective. Eastern Bank Ltd. uses mainly the graphic-rating scales for individual rating system. They should use the BARS, weighted checklist or forced choice to evaluate performance. Recently Eastern Bank Ltd. has introduced Descriptive Essay as its performance appraising system. We think that if any supervisor has any personal conflict with his / her subordinates and its peers, it creates Biases in performance appraisal system. Timing error in performance appraising evaluation process makes the performance appraising system less effective so that the subordinates are not able to get the immediate feedback from their subordinates to recover their inaccuracy. We think Eastern Bank Ltd. should concentrate in this factor because time generates money. Conclusion Finally, from the above analysis we can say, Eastern Bank Ltd. has an effective appraisal system by which they are monitoring the contribution of the employees and taking necessary remedial action to achieve the desired result. However, the Human Resource Department is not employing new employees, which we think is necessary to appraise the employees. Another critical point to be mentioned here, the appraisal is done annually, but for up to date appraisal of the personnel, the appraisal should be conducted semi annually. Apart from these reasons, Eastern Bank Ltd. has one of the most updated performance appraisal systems among the leading banks. References - Gary Dessier, Human Resource Management (11th edition - 2008), Prentice-Hill of India - Milkovich, G. T. & Boudreau, J. W. (1997). Human Resource Management. (8th ed.) Performance Appraisal (p.101) Chicago: Irwin. - Bateman, T. S. & Zeithaml, C. P. (1990). Management Function and Strategy. Performance Appraisal (p.451) Chicago: Irwin. - World Wide Web: http://passports.webster.edu/ http://www.ebl.com.bd Acknowledgement Md. Sirajul Islam Head of Human Resources Eastern Bank Ltd Mr. Kamrul Ahsan Senior Officer Eastern Bank Ltd Md. Alamgir Hossain HRM-501 Course Coordinator East West University Interview Questions Does your company use any performance appraisal system for company’s employees? Which types of application your company uses to evaluate your employee’s performance? Do you have any system to provide your company’s employees a useful feedback? What is the procedure to give the feedback to the employee’s to improve their performance? Did your performance appraisal system cover your company’s policy recourses and others company laws? Which sector of your employees are emphases on your performance appraisal? Do you have any reward or punishment system to increase or decrease one employee’s behavior towards his or her task? How do commitment, job analysis and measurement of performance influence of your company’s performance appraisal? Are your company’s measurement systems to the employees Valid, Reliable and free from bias? Did you ever use halo effect fro evaluating of your employees performance? Which types of sources you use for performance appraisal? What types of difference you find between The Theory and The Real Scenario? Review of Performance Appraisal System of EBL 41