International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528

http://www.researchersworld.com/ijms/

DOI : 10.18843/ijms/v5i3(4)/05
DOIURL :http://dx.doi.org/10.18843/ijms/v5i3(4)/05

Performance Appraisal Practice and its Effect on Employees’

Motivation: A Study of an Agro- Based Organization

Dr. Sweta Banerjee,

Professor,
Balaji Institute of Telecom and Management,
Sri Balaji Society, Pune, India.

ABSTRACT

Human Resource Management (HRM) is concerned with the people and management. Since every
organization comprises people, acquiring their services, developing their skills, motivating them to
higher levels of performance and ensuring that they continue at the same level of commitment to
the organization are essential to achieving organizational goal. Organizations realize their motto
through effective and efficient utilization and management of employees. If PA is conducted
appropriately and its result is communicated to the employees it will improve the overall
performance of the organization. This study was designed to assess the performance appraisal
practice and its impact on employee’s motivation. Moreover, PA was not strictly meeting its
intended purposes, due to this employee become de-motivated and working with low moral. In
addition to this, there is high rate of employee turnover and weak human power, poor customer
service delivery was revealed on the findings.

Keywords: Performance Appraisal, Performance Appraisal System, Motivation.

INTRODUCTION:
Human Resource Management (HRM) is concerned with the people dimension of management, since every
organization comprises of people, acquiring their services, developing their skills, motivating them to higher
levels of performance and ensuring that they continue at the same level of commitment to the organization and
are essential to achieving organizational goals according to Decenzo and Robbins (1989), This is true,
regardless the type of organization: viz. government, business, education, health, recreation, or social action.
Human resource management is one of an evolving science concerned with the management of people and
people constitute the principal asset of any organization.
Different organizations will have different goals and objectives to be achieved. Some of the major goals or
objectives are to produce quality product or rendering quality service, which enables them to satisfy their customers
need. As a result, they can achieve their organizational goals too. Organizations realize their motto through effective
and efficient utilization and management of employees. Employees are said to be the lifeblood of organizations,
because, through people that organizations can achieve their missions and visions. Therefore, its employees
determine the destiny of a given organization and it can be agreed, an organization is as good as its people.
As human resource (HR) is one of the most important resources in the organization, so it should be managed
well. One way of managing the HR is conducting performance measure and analyzing the role of performance
measure upon services to the employees. If Performance Appraisal (PA) is conducted appropriately and its
result is communicated to the employees it will improve the overall performance of the organization. The skill
to conduct performance appraisal relies on the ability to assess an employee‟s performance in a fair and accurate
manner. To do so, organizations must design a performance appraisal system (PAS) that can accurately measure
the overall performance of the employees.

Vol.–V, Issue –3(4), July 2018 [43]

International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

Performance Appraisal (PA) is the most important requirements for successful business and human resource
policy. The ability to conduct PA relies on the ability to assess an employee‟s performance in a fair and
accurate manner. To do so, an organization must design a Performance Appraisal System (PAS) that can
accurately measure the performance of its employees. PAS provides valuable performance information to a
number of critical human resource activities, such as allocation of rewards, e.g. merit pay, promotion, feedback
on development and assessment of training needs, and others. 1
Since performance appraisal is one of the most significant requirements for success of business and human
resource, organizations must design proper PAS in order to achieve the goals and objectives of the organization.
The key component of the Performance Appraisal Process (PAP) is the creation of specific performance criteria
or competencies. These performance standards (PS) must developed, defined and communicated to the
incumbent with performance monitored against those standards throughout the year. Without equitable and
objective standards, questions will continue to arise about how performance is measured and how compensation
decisions are made.
One of the most important concerns of a manager is to motivate employees to make their optimum contribution
to the achievement of organizational goals. Therefore, it becomes important for him/her to understand what
motivates employees to be had as they do. Since the needs of employees and the organization are not always the
same, the managers can better integrate these two sets of needs by gaining an insight in to the needs of his
employees and then persuade them in to the direction of organizational goals, because motivation is what drives
a person into doing something. (Cole 1997).
For PA to meet its desired objective appropriate techniques must be in place. Hence, there is a need to match
appraisal techniques to different PA situation in the organization.

THE PROBLEM STATEMENT:

The success of every institution depends on the quality and commitment of its human resources. In order to
ensure continued efficiency and effectiveness of members of staff each organization has to carry out employee
performance appraisal from time to time to keep them in check and replace, motivate, retrain or take any other
appropriate action. Proper undertaking of PA will have positive impact for both the organization and its
employees.2

Performance Measurement and Performance Management:

Pradeep, (2005) explained significant ideas related to performance appraisal, as a tool for achieving desired
organizational effectiveness. These are performance measurement and performance management.

Performance Measurement:
It is based on the belief that performance can be measured by objective indices. Stress is not so much on
behavior and activities as ends, of behavior and activities. Behavior or activities are seen rather as mean to the
important results. Performance measurement is necessary to enforce accountability to results.

Performance Management:
It is a result-oriented exercise. It brings into focus all organizational and sectional results, links them, into
perspective, relates them in terms of the larger picture, measures them, set up monitoring and feedback
mechanisms, and finally, institutes development plans to improve upon results procured thus.

Process of Performance Appraisal:

Performance appraisal comprises the following steps:
1. Select performance factors (based on job description) to be evaluated and set the standards to be achieved,
2. Set the performance review period,
3. Measure actual performance,
4. Compare performance with set standards and rate it with a suitable scale
5. Communicate the rating to the appraisee,
6. Use the performance appraisal for the desired purpose.( Pattanayak, 2009)

1
http://forebpx/vt/edu/usesrs/soc/ retrieved on 2nd October, 2017
2
www.aibama.org retrieved on 23rd Nov., 2017

Vol.–V, Issue –3(4), July 2018 [44]

International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

Benefits of Performance Appraisal:

Appraisal is believed to enhance managerial and organizational performance as well as positively contributing
to employee motivation Randell (as cited by Colling,2010). Conducted effectively, they credited with a number
of positive benefits:
1. Performance planning and goal setting
2. Providing feedback and coaching
3. Employee development
4. Linking employee performance to compensation and promotion decision
In addition to these, Pattanayak, (2009), stated the benefits of PA. PA is a formal exercise carried out for all
executives and workers with respect to their contributions made towards the growth of the organization. The
aim is to measure the overall performance of an employee over a period, usually one year by his/her immediate
supervisor to provide a feedback to the employees and aid the management. The benefits of successful appraisal
system can be summed up as follows:
For appraise:
i. Better understanding of the role in organization what is expected and what needs to be done to meet those
expectations
ii. Clear understanding of his/her strengths and weaknesses so as to develop himself/herself into a better
performer in future
iii. Increased motivation, job satisfaction, and self esteem
iv. Opportunity to discuss aspirations and any guidance, support or training needs to fulfill these aspirations
v. Improved working relationships with the superiors
For the Management:
i. Identification of performers and non-performers and their development towards better performance
ii. Opportunity to prepare employees for assuming higher responsibilities
iii. Opportunity to improve communication between the employees and the management
iv. Identification of training and development needs
v. Generation of ideas for improvements
vi. Better identification of potential and formulation of career plans
For the organization:
i. Improved performance throughout the organization
ii. Creation of a culture of continuous improvement and success
iii. Conveyance of message that people are valued
The above benefits will be realized only if performance appraisal is considered as a process of management.

Relationship between Performance Appraisal and Motivation:

In the growing age of business and markets, human resource is the big asset of the organization; if the
organization is not keeping well with its labor work force then it might get into trouble. Employees are the main
features of the progress of the organization. In order to have productivity, employee should be motivated and
should be satisfied with their job and have loyalty with the organization. HR professionals are making it
possible to motivate the employees with the performance appraisal systems by giving them fair appraisals, as
per their performance over a period of time. It has been noticed that there is a strong relationship between
performance appraisal and motivation, job satisfaction and loyalty. Keeping aside the main objectives of
performance appraisal, it can be use as a mechanism to create a completion between employees to get the job
done with all the linked targets and benchmarks (Robert, 1984).

Relationship between Performance Appraisal and Motivation:

In the growing age of business and markets, human resource is the big asset of the organization; if the
organization is not keeping well with its labor work force then it might get into trouble. Employees are the main
features of the progress of the organization. In order to have productivity, employee should be motivated and
should be satisfied with their job and have loyalty with the organization. HR professionals are making it
possible to motivate the employees with the performance appraisal systems by giving them fair appraisals, as
per their performance over a period of time. It has been noticed that there is a strong relationship between
performance appraisal and motivation, job satisfaction and loyalty. Keeping aside the main objectives of
performance appraisal, it can be use as a mechanism to create a completion between employees to get the job
done with all the linked targets and benchmarks (Robert, 1984).
Vol.–V, Issue –3(4), July 2018 [45]
International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

METHODS OF PERFORMANCE APPRAISAL:

There are different systems and methods for measuring performance and appraising the employees. These
methods and systems are categorized as the traditional methods and the modern methods. According to George
(2004, pp.361-362), the choice of method should be based largely on the purpose of the appraisal.

TRADITIONAL METHODS:
Trait Method. It is inexpensive to develop and use. The disadvantage of this method is that it has high potential
for rating error and it is not useful for employee counseling.

Behavioral Method. It uses specific performance, acceptable to employee and supervisor; useful for providing
feedback; are fair for reward and promotion decision. The disadvantage is that it is time consuming and can be
costly to develop.

Result Method. It has less subjectivity. It is acceptable to employees and supervisor; links individual
performance to organizational performance, encourage mutual goal setting; are good for reward and promotion
decisions. The disadvantage of this method is time consuming to develop or to use; may encourage short-term
perspective; may use contaminated criteria; may use deficient criteria.

Forced distribution:
One such change has been the use of systems of forced distribution. Forced distribution forces the appraiser to
rate a certain proportion of employees in different categories.
Performance appraisal methods can be broadly classified as measuring trait, behaviors, or results. Trait
approaches continue to be the more popular system despite their inherent subjectivity. Behavioral approaches
provide more action oriented information to employee and therefore may be best for development. The results
oriented approach is gaining popularity because if focuses on the measurable contributions that employees
make to the organization.
The simplest and least expensive techniques often yield the least accurate information. However, research has not
always supported a clear choice among appraisal method. While researchers and human resource managers generally
believe that the more sophisticated and more time-consuming methods offer information that is more useful, this may
not always be the case. Managers must make cost benefit decisions about which method to be use. (Ibid).

Modern Methods:
There are different methods of performance measurement in the modern times, 360 Feedback System and
Management By Objectives (MBO), Balanced Score Card (BSC).

Management by Objective (MBO):

This method is based on the principle of management by objective where the appraiser and the appraisee lay
down standards or target to be achieved. Appraises actual performance is measured against the standards or
target set at the end of a specific period. This system serves as motivation to influence appraisee to achieve the
target or standard set because it is noted to raise the morale of employees and for that matter the appraisee since
he is involved in the whole processes of appraisal.(Ibid)

Balanced scorecard:
The Balanced Scorecard is a strategic planning and management system used to align business activities to the
organization‟s vision and strategy, improve internal and external communications, as well as monitor
organizational performance against strategic goals.(Ibid)

360-degree feedback:
A 360-degree feedback is credited with providing a more holistic and effective source of feedback on individual
performance. Essentially, it involves getting feedback from multiple sources, including peers, supervisors,
colleagues and so on.
The 360 Feedback systems can be an ongoing process throughout the year to keep an eye on the performance
and other's perception about the employees and also it can be measured that how well employee is keeping with
its required tasks and responsibilities. (Ibid)

Vol.–V, Issue –3(4), July 2018 [46]

International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

There are four main parts of 360 feedback appraisal system:

a. Self-appraisal
b. Superior's appraisal
c. Subordinate's appraisal
d. Colleagues' appraisal
The success of organizations depends largely on the performance of its human resources. To determine the
contributions of each individual, it is necessary to have a formal appraisal program with clearly stated objectives.
Carefully defined performance standards that are reliable, strategically relevant, and free from either criterion
deficiency or contamination are essential foundations for evaluation. Appraisal system must also comply with
the law. Appraisal should be treated with the same concern for validity, as are selection tests.

International Perspective of Performance Appraisal:

Research reports indicate that there is widespread use of performance appraisal in work organizations all over
the world. This widespread use of performance appraisal system can be attributed to human resource specialists,
academics and consultants who proclaim that performance appraisal is a critically needed tool for effective
human resource management. Performance appraisal dates from the time of World War II. In a broader sense,
however, it is one of the oldest professions with origins in Frederick Winslow Taylor's 1911 Time and Motion
work, which used the scientific method to assess and improve worker productivity. 3

Result Oriented Performance Management Change Initiative:

Performance management is a systematic and strategic approach which works on continuous improvement of
teams and individuals performance so as to achieve organizational goals (Armstrong and Angela, 1998).

How often should Appraisal be Done:

Organizations use two basic timing periods for most employees. They are referred to as the anniversary date
(the date the person entered the current job or a common review date). Under a common review date system, all
employees are evaluated and compared so that such decisions as promotions, and merit pay increases have a
common period being covered for all employees.
Researchers have found that feedback on performance should be given frequently and the closer the feedback to
the action, the more effective it is. However, only few firms evaluate frequently. One way to reconcile the ideal
with the reality in this respect is for the manager to give frequent feedback to employees informally and then
formally summarize performance at evaluation time.
Another reason that some managers resist frequent subordinate evaluations is that they produce stress,
especially if a rater has to use a system in which he/she has little faith or confidence. There is also the stress
associated with having to inform another person that he/she is not performing at acceptable levels (Srinivas &
Motowidlo, 1987, as cited in Ivancevich & Glueck 1989, pp. 338-339). Researchers have found that raters
under stress tend to notice and recall negative information about those being evaluated.
Based on the employees‟ nature of work the researcher used stratified sampling technique to choose respondents.
Stratification factors such as position of respondents were used. It was categorized into two group Managerial
and Non Managerial.
The total number of population of the Office are (278) permanent employees. Since the population was
homogenous, the researcher specified the sample size to be 30% of the total population, which is 30% of 278 =
83 sample, was included.
Among 83 sample size 10.7 were managerial and 89.3 were none managerial employees. Due to their small
size, the proportion of the Managerial respondents is less than that of the Non Managerial employees.
And the employees who were included in the data collection are determined by the formula: 278/83 = 3.34 ≈ 3
therefore, by using the systematic random sampling methods, No. 2 is selected and every 3 rd employee were
selected from the list of total population up to the 83 sample size is satisfied.

CONCEPTUAL FRAMEWORK:
The employer chooses an appraisal approach or a mix of approaches to appraise the performance of employees.
The employee is either motivated or de-motivated to perform depending on how the appraisal was administered.
Whether employees are motivated or de-motivated, it affects their level of performance, which in turn affects

3
http://www.zenithresearch.org.in

Vol.–V, Issue –3(4), July 2018 [47]

International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

output (productivity). The employer receives this output as feedback on the effectiveness or otherwise of the
appraisal process. 4
Figure 1: Conceptual Framework

Unsatisfactory Work Performance Strategic Intervention

Performance Management Approaches

. Supervision, training, monitoring performance, and planning work and setting expectations

Hygienic Factors: Extrinsic Motivators

- Pay, Working conditions, Physical surroundings, Job

Intrinsic Motivators: Achievements, Recognition,

Good Work Performance: Satisfactory Work

Good Organization Performance

ANALYSIS OF DATA:
The data gathered through questionnaires were coded, entered into computer and analyzed and presented in the
form of charts, diagrams, and tables using SPSS. For analysis purpose the responses under Likert scale were
grouped in to three major categories: agree, neutral, and disagree.
Depending upon the nature of the basic questions and the data collected of this research, the researcher used
simple statistical tolls like percentage, table, charts, and figure.
The results of the interview questions were integrated to the responses of employees through questionnaires and
were analyzed accordingly.
As to the age composition of the respondents, the majority of the respondents 50.7% were between 25-34 years,
28% were between 35-44 years. About 12% of respondents were between age 45-54, 8% of respondents were
below 25 years old and the rest 1% respondent were above 55 years old. Regarding the sex of respondents, the
majority of the respondents 55% were males while 45% of them are females. The proportion of females is lesser
in all age groups.
Regarding educational qualification Table 2 reveals the majority of the respondents 49% are first-degree holders
and 23% of the respondents are diploma holder. Those who have masters‟ degree are 12% and 11% of the
respondents are technical and vocational school graduates, the rest of the respondents 5% are completed 12th grade.
Regarding specialization area, majority of the respondents 31% specialized in the field of management,
followed by 19% in the field of accounting and finance. From those who specialize in the field of management
19 % have BA, 7 % have college diploma, 5% have masters degree.
Regarding work experience, the above figure shows the largest groups of respondents 48% have a working
experience of 5-15 years on the current job followed by 23% have a work experience below 25 years, 21% of
respondents have a work experience in the range of 16-25 years, and 8% of the respondents have a work
experience of 26-35 years.
Based on the responses gathered from the employees of the Mayor‟s Office, I have tried to discuss the
employees‟ perception of the appraisal method, process, criteria and technique of the office of the Mayor‟s.
These questionnaires were designed using multiple-choice questions and under Likert scale were grouped in to
three major categories: agree, neutral, and disagree.

4
www.thesis.eur

Vol.–V, Issue –3(4), July 2018 [48]

International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

Performance Appraisal method:

Table 1: Response Regarding Performance Appraisal Method

Which one of the following PA methods is Position of respondents
Total
currently applied in your organization? Managerial Non Managerial
Count 0 18 18
BSC
(% ) (.0%) (24.0%) (24.0%)
Count 0 1 1
Ranking
(% ) (.0%) (1%) (1%)
There is no clearly defined Count 5 48 53
appraisal method (%) (11%) (64%) (75%)
Count 8 67 75
Total
(%) (11%) (89%) (100%)

As we can seen from Table 4, the largest no of the respondents 71% replied there is no clearly defined appraisal
method. Among these respondents 64% were from none managerial position and 7% respondents were from
managerial position. Those who answered BSC were 24%. Thus, it can be concluded that there is no clearly
defined appraisal method in the Office of Mayor. This may have negative impact on employees motivation.
Even though 24% answered BSC, the large number of respondents reveals that there is no clearly defined
method of PA in the office. As the majority response, currently there is no a practice of measuring employees
performance.
Interview was conducted with the Human Resource Department Head (HRDH), in order to gather additional
information on: method used to measure performance of employee; contribution by HRMD to establish a
system of appraisal; efforts made to improve practice of PA.
According to HRDH, there is no clearly defined method to conduct appraisal of employees in the office. For the
last ten years CGAA is trying to implement the BSC strategies but, due to many reasons this strategies are not
implemented, for this reason appraising of employee performance is pending. As a matter of fact, HRMD is
responsible for the start and achievement of such major personnel issues as human resources planning,
recruitment and selection, placement, training & development, determination of employee compensation
schemes, performance appraisal, promotion, demotion, transfer and layoff, of course with continuous assistance
and feedback from top management wherever necessary. Therefore efforts have been to enhance the over all
activities of HRM functions.

Performance Criterion and Process:

The first step in the performance evaluation process is the specification of the standards against which the
performance of employees will be judged. According to Mondy (1999), the criteria used for appraising
employee performance must be job related. More specifically, job information should be determined through
job analysis.
Table 2: Summary of Respondents Attitude towards the Criteria of PA
Which steps are included in the process of appraisal in your Position
organization? Non Managerial
Count 7 7
Establishing Standards
% 10% 10%
Count 4 4
Communicating standards with employees
% 6% 6%
Count 7 7
Measuring actual performance and comparing it
% 11% 11%
Count 4 4
Discussing appraisal with employees
% 6% 6%
Count 45 45
Appraisal steps or process are not clearly stated
% 67% 67%
Count 67 67
Total
% 100% 100.0%

Vol.–V, Issue –3(4), July 2018 [49]

International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

As we have seen Table 5, this question was presented only for non-managerial employees to check whether
there is appraisal criteria/process or not in their office. As indicated above the majority 67% respondents replied
appraisal steps or process are not clearly stated. 11% respondents answered that their office established
standards, and those who answered measuring actual performance and comparing it were 10%.
The rest of the respondents answered communicating standards with employees and discussing appraisal with
employees are 6% respectively. Hence, on the basis of the response of majority respondents it is likely inferred
there is no clearly defined criteria for appraisal.
In the absence of such clearly laid down goals, personal goals may control over organizational goals, in which
case organizational productivity would be negatively affected.

Job Description:
Job is a collection of task, duties, responsibilities, which as a whole from the establishment to an individual
employee at a specific position. And job description is a formal, written explanation of a specific job, usually
including the job title, task, relationship with other jobs, physical and mental skills required, duties
responsibilities and working conditions; a part of the job evaluation process wherein a review of the nature of
work occurs in relation to other jobs, working conditions, the degree of responsibility required. In addition, the
appraisal should measure how well the various parts of the job are being performed. It should identify the
employee‟s strengths, as well as the aspect of the job where improve, performance is needed. When this has
been identified and agreed on between managers and employees, a performance improvement plan should be
developed and implemented.

Table 3: Summary of Respondents about Job Description

Do you provide those employees working under your supervision
Managerial Total
with job description and clear performance expectations?
Count 2 2
Yes
(% ) (25%) (25%)
Count 6 6
No
% of Total 75% 75%
Count 8 8
Total
(%) (100%) (100%)

As we can see majority of the managerial employee 75% said no, the rest 25% employees said yes. As we can
observe from the respondents, response there is no practice of providing employees with job description.

Table 4: Summary of Respondents Attitude towards Job Description

For Non Managerial
Performance goals are clearly communicated to you
Frequency Percent
by your supervisors via job descriptions or other
statements of performance expectations
Disagree 39 58%
Neutral 15 22%
Agree 13 11%
Total 67 100%

As we can see from Table 7, the majority of the employees 58% of the respondents disagreed and were not
provided with job descriptions and hence were not well aware of the performance level that was expected of
them. 22% of the respondents are neutral.
From both managerial and non managerial response it can be concluded that there is no the practice of
providing job description to employees in the office.
In the absence of job descriptions, defining standards or criteria of performance appraisal would be difficult,
employees may loose sight of the most important and challenging job activities while concentrating on the less
important ones that contribute little to the effective performance of the individual or his/her work unit. However,
well designed job descriptions, are the instruments that form the standards (criteria) against which employees‟
performance would be measured.
Vol.–V, Issue –3(4), July 2018 [50]
International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

Working Environment:
The working environment includes: work process management styles (the way managers act while they are
leading others); teamwork (to generate positive synergy through coordinated effort); culture (that binds
members of an organization together through shared values); affect the implementation of PA either positively
or negatively depending on the prevailing conditions i.e., whether or not the work environment allows to
implement the system without breakdowns in the process of undertaking objectives in the organizations.

Table 5: Summary of Respondents Attitude towards Working Environment

For Non Managerial
Are you are satisfied with working environment in Frequency Percent
your organization
Disagree 57 (85%)
Neutral 4 (6%)
Agree 6 (9%)
Total 67 (100%)

As indicates on Table 8, majority respondents (85%) were not satisfied with the working environment. 9% were
satisfied and 6% are neutral.
Thus, it can be concluded that, on the bases of the response of the majority of the respondents, the working
environment in the Office of Mayor was not good for them. Their level of satisfaction will not lead them to
work hard and put their full efforts at work. If the employees are not, satisfied with their working environment
they become de-motivated and they have to force to looking for another job. In addition to this, some
employees explained that their office does not consider administration work rather it focuses only on the
political issue.

Employees Attitude towards Performance Appraisal:

It has long been recognized that performance appraisal plays an important role in organizations. It serves a
variety of purposes such as providing the basis for making selection decisions, determining salary increases, and
provides a vehicle for feedback between the supervisor and employees and can be used as a powerful tool for
managerial control.

Table 6: Summary of Respondents attitude towards the purpose of Performance Appraisal

My Office is open, transparent, I have got the opportunity to
Degree of
and communicates well participate in the design of PA form
Agreement
Count (%) Count %
Disagree 44 (66%) 49 (73%)
Neutral 5 (8%) 2 (3%)
Agree 18 (27%) 16 (24%)
Total 67 (100%) 67 (100%)

As Table 9 indicates 66% of respondents disagree with the statement my Office is open, transparent, and
communicate well and 27% agreed with it. The rest 8% were neutral. Even if there is different perception
among respondents in this regard, as the majority respondents response, can be conclude the level of openness
and communication process was poor.
As cited by McCourt and Eldridge (2003) asserted that the success of PA depends on participation of
employees. Nevertheless, transparency and continuous follow up is also weak. If employees are not allowed to
participate and communicate openly with their appraiser, they do not have the chance to know about their
strength and weaknesses.
From the above table, the majority (73%) of respondents did not get the opportunity to participate in the design
of PA and 24% of respondents got the opportunity. The rest 3% were neutral. According to the finding of
majority respondents have no access to participate in the preparation of PA. This implies that the design of the
evaluation form and its content is left to the managers of the Office and it does not encourage participation of
the employees in the design of the form
As one major purpose of PA, is creating open relationship among evaluatees and evaluators to increase the
Vol.–V, Issue –3(4), July 2018 [51]
International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

motivation and commitment of employees and feel fairly treated, to develop their abilities of planning, and
provide the opportunities for individuals to express their aspiration about their work should be highly
encouraged.
Table 7: Summary of Respondents towards Feedback
I am satisfied with the way my The feedback I receive on how I
Degree of
organization provides me with feedback. perform my job is highly relevant.
Agreement
Count (%) Count (%)
Disagree 57 (85%) 41 (61%)
Neutral 3 (5%) 4 (6%)
Agree 7 (10%) 22 (33%)
Total 67 (100%) 67 (100%)

As indicated Table 9.1 the respondents were not satisfied with the way their organization provides them
feedback, majority of the respondents 85% said disagree, followed by 10% respondents agreed with the way
that their office provides feedback on performance. Those who said neutral were 5%.
As it is revealed, there is big difference between agreed and disagreed. Hence, from the bases of the response of
majority respondent, it can be concluded that there is no feedback on the performance of employees since there
is no properly established system of PA.
People want to know how they are doing on the job, and it is the responsibility of the managers to tell them.
This requires the managers to evaluate their performance and communicate the appraisal to them. This process
of appraisal and communication should be regular and on going.
As it is noticed in Table 7 the statement “The feedback I receive on how I do my job is highly relevant” was
posed to the respondents so that they could forward their level of agreement. Thus, the majority 61% of the
respondents disagreed, and 33% respondents agreed. The rest 6% respondents replied neutral. As we can
observe from the attitude of the majority respondents indicate they are not happy with the feedback. So it can be
concluded that there is no a practice of giving feedback in the office.

Table 8: Summary of Respondents Towards their attitude on purpose of PA

Do you think that the performance appraisal is meeting Position
its intended purposes of determining employees' Managerial Non Managerial
compensations, promotion, demotion, transfer and
Total Total
identification of employees' training needs?
Count 2 2 52 52
Yes
(%) (25%) (25%) (22%) (22%)
Count 6 6 15 15
No
(%) (75%) (75%) (78%) (78.6%)
Count 8 8 67 75
Total
(%) (100%) (100%) (100%) (100%)

From the above table we can observe the majority 75% of managerial and 78.6% of non-managerial respondent
replied No, where as 25% of managerial and 22% of non-managerial respondents said Yes.
The respondents did not believe that the performance appraisal system of the Office is meeting its intended
purposes. The performance appraisal has no significance in determining employees‟ future in the Office, the
responses from the respondents indicated that one or a combination of the following might have accounted for
their perception of the system:
 Lack of clearly defined criteria for conducting PA. For effective implementation of PA the first process is
setting criteria of appraising the performance of employees.
 Lack of clear connection between performance and reward. So long as employees could not observe their
efforts being accompanied by positive performance that eventually leads to rewards (which may be in the
form of promotion, salary increase, or training & development) in a reasonably short period, they wouldn‟t
be motivated and consequently their attitude towards the system‟s effectiveness would be distorted.
 Absence of clear and transparent communications between the Human Resources Department and the
different work units on how employees‟ performance would be valued and what administrative decisions
would be taken on that basis might have a negative implication on employees perception.
Vol.–V, Issue –3(4), July 2018 [52]
International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

From this it can be conclude the PA did not achieve its intended purpose in order to determine employees‟
compensations, promotion, demotion, transfer and identification of employees; training nee. Therefore, it is
highly advisable the office must revise its HRM manual.

Table 9: Summary of Respondents Attitude towards Training

In your office there is on job training program Frequency Percent
Disagree 52 (78.6%)
Neutral 1 (2%)
Agree 14 (21%)
Total 67 (100%)

The distribution of percent in Table 9.3 reveals the majority 78%, and 21% of employees were report that
disagree and agree respectively. 2% employees were neutral. According to the majority response this
distribution, there is no on job training program to enhance employees ability. Some respondents explained that
training has given for some employees is unfair but that training was not job related and that does not build their
capacity for a better product or better quality service.
Skill can be acquired through training and practice on an intervention. Its aim is to enable such employees to
perform their current and future role effectively. No matter how well the person matches the job, some training
is always necessary. Training includes the teaching of knowledge, skills, and attitudes.

Benefits of PA:
Appraisal is believed to enhance managerial and organizational performance as well as positively contributing
to employee motivation. Conducted effectively, they credited with a number of positive benefits: performance
planning and goal setting; providing feedback and coaching; employee development; linking employee
performance to compensation and promotion decision.
the majority of respondents 75% agreed and 25% respondents disagree with the statement performance
appraisal is valuable to me as well as to my organization. From this we can infer that PA is very crucial for the
employees. If the appraisal conducted in effective manner, it benefits the employee, the manager and the
organization as a whole. Hence, on the bases of the response of the majority of the respondents it is highly
advisable to the Office to conduct PA to get the benefit from this. Conducting performance evaluation helps
organizations to reward and promote effective performers and identify ineffective performers to developmental
programs or other personnel actions that are essential to the effectiveness of HRM.
indicates the majority of respondents 84% disagree and 17% respondents agree the statement, there is a strong
link between performance and reward in your office.

Employees Attitude towards the Linkage between PA and Employee Motivation:

Motivated employees are needed for an organization‟s survival in a highly competitive world. Motivated
employees are more productive hence; managers need to understand what motivates employees. One of the
managerial functions is employee motivation. However, this function is rather complex since what motivates an
employee today may not necessarily motivate them tomorrow.
Therefore, well-motivated employees are those who work along clearly defined goals and who take action,
which will result in these goals being met. Employees who manage to motivate themselves seek, find and carry
out work that satisfies their needs. However, majority of employees need to be motivated by the management
through pay, praise, promotion, transfer, training and development in order to improve their performance.
the majority of the respondents 65% disagreed, followed by 20.% were replied agree. 4% of the respondents
were neutral. It could then be concluded that, the respondent disagree on the claim that performance appraisal
does not determine pay and promotion decisions. A good promotion system is useful to employees individually
as well as to the administration as a whole. From the majority respondents response the office must establish a
system how motivate employees.

Impact of PA on Employee Motivation:

For getting maximum effort and performance from employees is to reward for performance, not on the basis of years
of services, favoritism, or any thing else. Reward can be monetary, such as wage incentives, merit salary increases,
bonuses, profit sharing, and prizes. Alternatively, they can be non-monetary, such as praise, special job assignment,

Vol.–V, Issue –3(4), July 2018 [53]

International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

more responsibility delegated task, asking for ideas better working condition status symbol and authority.
The respondents were asked to respond whether it is essential to conduct performance appraisal in your Office?”
The majority of the respondents about 95% from managerial and none managerial answered „yes‟. Findings of
the responses showed that PA is conducted for a number reasons including:
 To measure the actual performance of employees‟ against tasks assigned to them;
 To enable employees to know their strengths and weaknesses with the view to motivate them to do better or
warn them on the consequence of their weaknesses;
 To follow up the subordinates as well as to praise workers who works hard as long as it is conducted in a
right judgment.
 To minimize employees‟ carelessness and negligence and to reward and punish them.
 To correct employee‟s behavior or to take corrective action whenever employees are in the wrong way or
truck and if their performance is extremely below the expected performance standard.
 Performance appraisal is essential to the organization, as the employee performed well should be rewarded
whereas the employee with poor performance should be known and to be informed to improve his/her
performance.
 To identify training needs, staff development and to properly and fairly undertake staff promotion.

Table 10: Summary of Respondents Perception about PA Problem

Which of the following problems apply to the

Managerial Non Managerial
appraisal system of your organization?
Count
A. Lack of rater ability (training) to evaluate your 1 1 2
performance % 1% 1% 3%
B. Absence of employee participation in setting Count 2 15 17
performance evaluation criteria % 3% 20% 23%
Count 3 27 30
C. There is no clear criteria to measure
% 4% 40% 44%
D. No link between some evaluation criteria and Count 2 1 3
employee job % 3% 1% 4%
Count 0 23 23
E. B, C and D
% .0% 31% 31%
Count 8 67 75
Total
% 10.7% 89% 100.0%

As indicated in the above table the majority 44% of the respondents from managerial and non-managerial
replied that, there is no clear criteria to measure. 31% of respondents replied or chosen three of the above
choices B. Absence of employee participation in setting performance evaluation criteria, C. There is no clear
criteria to measure D. No link between some evaluation criteria and employee job and 23% of respondents from
managerial and non-managerial said employees participation in setting performance evaluation criteria and 4%,
3% replied the link between employee performance evaluation criteria and rater bias respectively.
Appraisal has to be against certain criteria. If a discrepancy between expected and actual performance is pointed
out, the question is whether the expected was fully defined and communicated to the employee. In the absence
of such an attempt, the appraisal reports can be questioned.

Table 11: Summary of Respondents Attitude towards Rater

In your opinion, who should evaluate an employee's Position of respondents
Total
performance? You may choose more than one. Managerial Non-managerial
Count 0 33 33
Immediate supervisor
% of .0% 44% 44%
Count 0 4 4
Colleagues
% .0% 5% 5%
Count 1 1 2
Subordinates
% 1% 1% 3%
The employee Count 0 9 9
Vol.–V, Issue –3(4), July 2018 [54]
International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

In your opinion, who should evaluate an employee's Position of respondents

Total
performance? You may choose more than one. Managerial Non-managerial
himself/herself % .0% 12% 12%
Count 1 1 2
Customer
% 1% 1% 3%
Customer and Immediate Count 6 19 25
supervisor % 8% 25% 33%
Count 8 67 75
Total
% 11% 89% 100.0%

The above question was raise to know their view on who should evaluate appraisal about appraiser, as revealed
in the above table 44 % of respondents answered immediate supervisor followed by 33% respondents answered
customer and immediate supervisor. Those who said employee him/herself are 12% and those who said
colleagues are 5% and 3% respondents said subordinates and customers respectively.
When we see the managerial respondents‟ majority of them replied both customer and immediate supervisor,
whereas the majority of non-managerial respondents replied immediate supervisor.
As the office is service render organization many customers have come to get services, therefore it is better that
both customer and immediate supervisor to be rate appraisal of employees.

PA and Motivation:
 Majority of respondents 65.4% indicated regarding promotion, as the finding revealed, there is no
promotion as a result of good work. Promotion was not facilitated for those who perform well. Motivated
employees are those who work along clearly defined goals. The reason for this might be failure in
conducting PA. As the finding revealed there is no motivational factor that motivate employees. And there
is no financial and non financial rewards based on job and there is a practice of recognition of good
performer. As a result the initiation of employees for work is weak and has a negative implication.
 The result of the findings indicates, the office has made efforts to conduct PA in a best possible way.
Majority respondents (94.7) indicated it.
 Regarding the problem, as indicated all problems are available except rater bias. In the finding the major
problem of PA is criteria for effective appraisal was not established as 44.3% indicated, in addition to this
30%of respondents reported both absence of employees participation in the preparation of setting goals and
objectives and criteria setting are another major problem.
 The finding revealed majority of the non-managerial respondents 44% favored that appraisal only by
immediate supervisor whereas majority of managerial respondents 33.1% favored both immediate
supervisor and customer.

CONCLUSION:
As it was explained in the introduction part of this study, in today‟s era of competition, organizations should
provide accessible and quality services, and meet customer needs in order to survive. To make certain the
survival of the organization requires providing quality services for customers and satisfying their needs. The
organizations must go through the process of change. In other words, the organizations should have committed,
motivated, self-confident, and high performance leaders and employees. Having these types of personnel, the
organizations amongst others, ought to have effective performance appraisal and motivational system. Based on
the above major findings the researcher concluded the study in the following way:
 The presence of unclear appraisal system in the organization did create common performance appraisal
problem.
 The appraisal standards lack relevance. There is no strong link between the standard and the individual job
description. As a result employees become dissatisfied and de-motivated.
 The appraisal system failed to distinguish the outstanding, good and average performers.
 Employees were not consistently participating in the design of standard performance appraisal systems and
motivational decision.
 This situation would result in employees de-motivation, dissatisfaction and lack of commitment. These
drawback would result negative impacts on the productivity and service delivery of the employees.

Vol.–V, Issue –3(4), July 2018 [55]

International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

RECOMMENDATION:
 To establish performance appraisal system with clearly defined standards and criteria in relation to the objectives
of the organization. However, research has not always supported a clear choice among appraisal method.
 To provide job description for all employees in order to identify what employees are expected to do on the job and
indicate exactly what employees do, how they do it, and the conditions under which the duties are performed.
 To create conducive environment for work as it is one of the most essential tool which leads employees in
the right direction. A positive working environment increase motivation of employees and is used in
retaining experienced and talented employees for a longer period.
 A well-designed communication system can help achieve data that are potentially valuable for use in
numerous human resource functional areas: human resource development, career planning and development,
compensation program, internal employees‟ relations and assessment of employee‟s potential.
 To arrange substantial training and development programs for the employees and introducing best ways of
performance appraisal methods along with designing employee motivational schemes.
 The organization should encourage the participation of its employees while setting goals, objectives,
standards and process of designing the form and other materials required for Performance Appraisal Systems
in order to make them more responsible and to create the spirit of ownership.
 To be successful one significant criterion that has to be fulfilled and promoted in the organization is the
culture of openness and transparency. Continuous communication should take place in the organization in
order to be aware what is being planned, what is expected to happen, what has happened, and what
corrective actions are being taken. Therefore, the Office should establish open and transparent culture to
influence behavior, attitude and beliefs of the staff.
 Motivated employees are needed for an organization‟s survival in a highly competitive world. Motivated
employees are more productive hence; managers need to understand what motivates employees. Every
employee within a company is different and, therefore, is motivated to perform well for different reasons.
Due to the differences within an organization, it is important for a manager to get to know its employees and
understand what motivates their performance. If you are going to be successful in motivating people, you
have to begin by accepting and trying to understand individual differences.
 HRM is the utilization of the firm‟s human resources to achieve organizational goals. It is widely
acknowledged that employees are the most important and most valuable asset. Effective human resource
management is about enabling each member a key contribution towards organization survival and growth in
an increasingly competitive world. Therefore, it is highly recommended to the Office to revise its human
resource manual and give due consideration human power.
 The human resource managers, officials, managers and the administrative body in the organization are not
exerting their maximum effort to enhance the human capital management hence; care should be taken into
consideration regarding this. Turnover, absenteeism, tardiness and poor customer service delivery would be
the result of poor management of human power.
 To conclude, the organization should appreciate and value individual employees or team participation in its
entire move to introduce a new performance appraisal system since the employees are the subjects of
performance and any system cannot be expected to be effective without first involving all the parties that
have a stake in it.

REFERENCES:
Armstrong, M. (2001). A Hand book of Human Resource Management Practice, London: Kogen Page.
Bowerman, B. and Richard, C. (2003). Business Statistics in Practice. (3rded). New York: McGraw Hill Higher
Education Company.
Brown, K. (2004). Human Resource Management in the Public Sector. Public Management Review.
Chandan, J. (1995). Organizational Behavior. Delhi: Kay Kay Printers.
Cole, G. A (1997). Personnel Management, Theory and Practice (4th ed). London: Martins the Printers Ltd.
Colling, David G. and Wood Geoffrey (2010). Human Resource Management. A Critical Approach. London and
New York: Rutledge Taylor and Frances Group.
Creswell, J.W. (1994). Research Design: Qualitative and Quantitative Approaches, Sage Publications:
Thousand Oaks.
Daley, D. M.(1992). Pay for Performance, Performance Appraisal, and Total Quality Management, Public
Productivity & Management Review, 16(1).

Vol.–V, Issue –3(4), July 2018 [56]

International Journal of Management Studies ISSN(Print) 2249-0302 ISSN (Online)2231-2528
http://www.researchersworld.com/ijms/

Decenzo, David A. and Robbins Stephen P. (1989). Personnel/Human Resource Management, (3rd ed). New
Delhi: Prentice Hall.
Decenzo, David A. and Robbins Stephen P. (2003). Fundamentals of Human Resource Management (8 th Ed).
John Wille and Sons Inc.
Desseler, G. (1997). Human Resource Management. New Jersey: Prentice-Hall.
George, Bonlander Smell (2004). Managing Human Resources Behavior (13th Ed). Thomson, South-Western.
Hopkins, C. (1980). Understanding Educational Research. Columbus: Bell and Howell.
Ivancevich, J. M. & Glueck, W.F. (1989). Foundations of Personnel/ Human Resource management, IRWIN
Inc., Homewood/Boston.
King, Patricia (1984). Performance Planning and Appraisal. New York: McGraw Hill Book Company.
Kirkpatrick, L. Donald (2006). Improving Employee Performance: Though appraisal and Coach (2nd ed). New
York: AMACM.
Koul, L. (2006). Methodology of educational Research (3rd ed). Delhi: Vikas Publishing House.
Megginsons, Leonc (1981). Personnel Management a Humana Resource Approach (4th ed). Home Wood
Lilions Richard D. Irwin Inc.
Mondy, and Noe, (1990). Human Resource Management, (4thEd). New York: McGraw Hill.
Mondy, R. W., Noe, R. M. and Premeauk, S. R. (1999). Human Resource Management (7th ed). New Jersey:
Prentice Hall Inc.
Morrisey, George L. K, Nirruse (1983). Performance Appraisal in the Public Sector. California: Addison
Wesley Publishing Company.
Neal, James E (2001). The #1 Guide to Performance Appraisal (2nd ed). USA: Neal Publication Inc.
Pattanayak, Biswajeet (2009). Human Resource Management (3rd ed). New Delhi: PHL Private Limited
Phlip, Tom (1990). Appraising Performance for Result (2nd ed). UK: Mcgraw-Hill Book Co.
Pradeep, Sahni (2005). Social Science, Human Resource Management. New Delhi: Shagun Offsed Press.
Polidano, C. (1999). The New Public Management in Developing Countries, University of Manchester: Institute
for Development and Policy and Management.
Robbins, S. P. (1996). Organizational Behavior: Concepts-Controversies-Applications (7th ed). New Jersey:
Prentice Hall Inc.
Saiyadain, M. S. (1999). Human Resource Management, (10th ed). New Delhi: Tata McGraw-Hill Publishing
Co. Ltd.,
Werther, W.B. & Davis S, K. (1989). Human Resources and Personnel Management. (3rd ed). Singapore:
McGraw-Hill, Inc.

----

Vol.–V, Issue –3(4), July 2018 [57]