Dr. J. Vincent Xavier Asst. Professor, School of Management Studies, St. Joseph s College (Autonomous) Tiruchirappalli, Tamil Nadu, India

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1 International Journal of Research in Management & Business Studies (IJRMBS 15) Vol. Issue 1 Jan. - Mar. 15 ISSN : (Online) A Study on the Effectiveness of Performance Appraisal System and its Influence with the Socio-Demographic Factors of the Employees of a Manufacturing Industry in Tamil Nadu Dr. J. Vincent Xavier Asst. Professor, School of Management Studies, St. Joseph s College (Autonomous) Tiruchirappalli, Tamil Nadu, India Abstract The present competitive environment, organizations have to ensure peak performance of their employees continuously in order to compete the market place, effectively and traditionally, this objective was attempted to achieve though employee performance appraisal which was more concerned with telling employees where they lacked in their performance. Once the employee has been selected trained and motivated, he is then appraised for his performance. Performance appraisal is the step where the management finds out how effective it has been at hiring and placing employees. If any problems are identified, steps are taken with the employed and to remedy them. The performance of an employee is influenced with various factors. The socio demographic factored has influenced in many ways.here the researcher tries to find out the effectiveness of the performance in Tamil Nadu based manufacturing industry, India. It is a descriptive type of research, simple random sampling was adopted, and self-prepared, structured questionnaire with the five point scale was used to collect the primary data. The finding is the socio demographic factors and the overall performance of the employee has the influence. Key words Performance Appraisal, Performance management, Employee appraisal, Human Resource. I. Introduction Performance Appraisal is a process of evaluating an employee performance of job in terms of its requirements. Heyel observes, it is the process of evaluating the performance and qualifications of the employees in terms of the requirement of the job for which he is employed, for purposes of administration including placement, selection for promotions, providing financial rewards and other action which require differential treatment among the members of a group as distinguished from actions affecting all members equally others regard, it as a process of estimating or judging the value excellence, qualities or status of some object, person or thing. collectively, it is a part of all the other staffing processes, recruitment, selection, placement and indoctrination. It is found systematic assessment of how well employees are performing their jobs in relation to established standards and the communication of that assessment to employees. (Wendell French:199) Employee appraisal techniques was used for the first time during the First World War, when, Walter dill Scott, the US army adopted the man to man rating system for evaluating military personnel. During the 19-3 periods, rational wage structures for hourly paid workers were adopted in industrial units. Prof. Beach has charted out, showing the changes in the terminology of employee appraisal that have taken place since 19. The major aim of performance appraisal is to enable an organization to maintain an inventory of the number and quality of all managers and to identify and meet their training needs and aspirations. In addition, increments rewards, maintain individual and group development and improving the employee s performance. To measure the performance appraisal there are several methods and techniques. The method and scales differ for obvious reasons. These are based on the sources of traits or qualities, different kinds of workers, and degree of precision of the employees. The types of performance appraisal are involved both in traditional and modern methods. Perhaps we have various types of appraisal methods they have certain limitations. Mamoria C.B, () pointed out that, if the factors included in the assessment are irrelevant, the result of merit rating will not be accurate. Some of the factors are highly subjective thereby making the rating on scientific lines highly difficult. Supervisors are guided by their personal emotions, likes and dislikes. This makes their ratings highly biased. But at present every organisation has their own method to appraise the employees. The s are based on their immediate internal and external environment. Even though there are some tested tool to measure the employee performance it is difficult to follow because, the organisation s climate may differ from industry to industry. Many organisations they have formulated their own system which are prepared based on their own circumstance. Here the researcher tries to say the influence of the socio demographic factors on performance in a manufacturing industry situated at Tiruchirappalli, Tamil Nadu, India. II. Statement of The Problem The problem of this research is to identify the relationship between socio demographic factors and the performance, further how it influenced on promotion, enhancing the job skills and qualities, fixing of salary, and increment. III. Objectives of The Study The major objective of this study is to find out the effectiveness of the performance with the relevance of the socio demographic factors of the employees. IV. Hypothesis There is an association between socio demographic factors and the overall performance. V. Scope of The Study This study has scope as it covers a wide range of the effectiveness of the performance. This study would not only provide a vital input in the reformulation of a new PA system but also identify the influence of PA system with the socio-demographic factors. Further this study would make the employees understand about the ways and means to develop a sound financial viability and growth. More than it enhances the performance of the whole 15, IJRMBS All Rights Reserved 6

2 ISSN : (Online) Vol. Issue 1 Jan. - Mar. 15 International Journal of Research in Management & Business Studies (IJRMBS 15) organization considerably. VI. Review of Related Studies For the present study reviews were collected from the previous studies, books, journals and other related articles. Hassan Danial Aslam (1) had studied the Improving Performance Management Practices in IT Firms of Pakistan. Results indicated that by implementing steps of performance management processes i.e. setting objectives, training, performance agreement, and performance review and reward. Ellen V. Rubin (11) conducted the Appraising Performance Appraisal Systems in the Federal Government: A Literature Review, The result suggests analyzing performance structures, beyond employee survey data; it provides to the scholars with rich research opportunities. Singh Sanjeet (11) conducted A Study of Effect of Performance Appraisal on the Organization and the Employee. The findings of the research showed that there is a noticeable effect of the performance appraisal on the organization as well as on the Individual. Miah Khasro M., (1) studied the Performance Management System in UK Retail Industry: it is a case Study. Findings showed that, the organization is very powerful in employee performance management, as they are concerned for both poor and high performer with corrective action and reward respectively. Devina Upadhyay & Anu Guptha (1) have conducted Efficacy of Performance Management System: An Empirical Study at ICICI Bank. This research has attempted to minimize the research gap existing in the field of efficacy of performance management system. Zvavahera P (13) had conducted An evaluation of the effectiveness of performance management systems on service delivery in the Zimbabwean civil service. It was concluded that the current performance management system was not enhancing the provision of quality service in the civil service because employees did not see any merit in its application. Roger sumlin (1) studied Performance management Impacts and Trends The result of the study was every organisation has find out their own PA system. Khushbu S. Dave (1) had conducted a research Paper on Performance Appraisal of Nurses in Hospitals. This analysis clearly states that there is a need to go for the improvement in the performance Appraisal system of nurses to get better outcome. Involvement of nurses for their appraisal will make the s more effective, easily and meaning because, it will help the hospitals to get the expected results in minimum time. VII. Methodology of This Study The period of the study was between May to November 1. It is purely an empirical and the descriptive form of study. The pilot study was conducted in a cement manufacturing industry situated at Tiruchirappalli District of Tamil Nadu state in India. The researcher has formulated the questionnaire based on the objective of this study. The questionnaire was properly tested its reliability and validity with the level of.861, the Split half Guttmann method was used. Ten questionnaires were given to the respondents for the pre-testing. The population was employees 5 per cent simple random sampling was taken for the study. The primary data were collected through the questionnaire. The secondary data were collected through various books, journals and some web journals. The data were analysed with the proper statistical application. This study has certain limitations. The study was conducted only at a single cement manufacturing industry. Therefore the findings are not generalized with other industries. The reliability of the research report is purely based on the consistency of the responses given by the respondents. VIII. Data Analysis and Interpretation The data were analysed in two ways, a simple percentage and statistical analysis were carried out. Analysis based on Socio-demographic factories Table 1 : Source Primary data S.No Details A B C D E 1 Age Below 5 (%) 6-35(%) 36-5(16%) 6 and (18%) Gender 9 % (Male) 8 % (Female) 3 Edu Diploma (17%) UG (51%) PG( %) Qualification Designation Supervisors (8 %) Engineers (1 %) Managers (31%) 5 Experience Below 5 years (5 %) 6-1 (1%) 11-15(6%) Above 16 yrs ( 3%) 6 Monthly income Below 1-(%) 11- (1%) 1-3 (38%) 7 Marital Status 5%(Married) 8% (Unmarried) 31-- (6%) 1 and (8%) From the table No.1 it is revealed that the socio demographic factors of the employees. From this per cent of the respondents are below the age 5 years. Regarding gender wise distribution, 9 per cent of the respondents are male and 8 per cent of the respondents are female. Therefore, it is manufacturing industry perhaps most of the respondents are male. In this half of the respondents are qualified at undergraduate level. Maximum numbers of respondents are from engineers. While 5 per cent of the respondents have received monthly salary between Rs.1-3, and 5 per cent of the respondents are married level. All Rights Reserved, IJRMBS 15 7

3 International Journal of Research in Management & Business Studies (IJRMBS 15) Vol. Issue 1 Jan. - Mar. 15 ISSN : (Online) Age wise distribution Marital status IX. Analysis on Performance Appraisal system Regarding the opinion of the respondents on the performance in the industry, there are fifteen selected statements analysed. First, the opinion on the level of PA system, majority of the respondents (6 per cent) has agreed that the existing PA system is good. Whereas the PA system helps to the employees to identify the areas that need to improve and asses the training needs of the employees, majority of the respondents (8 per cent) have agreed; only minimum number of the respondents (8 per cent) have disagreed. The statement regarding exposure about why performance appraisal is conducted, for this statement half of the respondents have agreed (57 per cent) that to know the employees actual performance. Only minimum number of the respondents have disagreed (37 per cent). Regarding PA by the subordinates, majority of the respondents (6 per cent) have agreed and only few members (6 per cent) have disagreed. It is seen that the industrial democracy is practised well in the organisation. Diagram no- 3 Diagram no- Training needs and PA Opportunity to express views on PA The statement regarding the opportunity to express their views on PA system, majority of the respondents (66 per cent) have agreed the statement. Minimum numbers of the respondents have disagreed. The statement regarding PA helps the employee to understand their ability and inability about performance majority of the respondents have agreed and only minimum numbers of the respondents have disagreed. Next the statements regarding periodically conducting of PA system, majority of the respondents (6per cent) have agreed and welcomed the periodical assessment.. Only minimum numbers of the respondents have disagreed, whereas the results of PA is properly communicated to the employees nearly half of the respondents only agreed that statement. The remaining is disagreed. It is found that the results are not properly communicated. 7 per cent of the respondents have agreed the statement regarding the PA system increased my skills and quality, Only 6 per cent of the respondent s have disagreed. It is shown the PA system not only the technical part but also it covers the employees qualities like behaviour, interrelationship. While, the confidentiality of the PA system, majority of the respondents (68 per cent) have agreed that it is confidential. Minimum number of the respondents (6 per cent) have disagreed the statement. It is found the result of the PA system is not shown to other employees, because it may create quarrels between the employees. 15, IJRMBS All Rights Reserved 8

4 ISSN : (Online) Vol. Issue 1 Jan. - Mar. 15 International Journal of Research in Management & Business Studies (IJRMBS 15) Diagram no- 5 Diagram no- 6 Confidentiality of PA Wage and increment with PA The statement regarding fixing of wage and increment and the result of PA, a vast majority of the respondents (7 per cent) have agreed that the wage and increment have been fixed based on the result of the PA. Only 1 per cent of the respondents have disagreed. It is observed that the performance gets its value. The results of the performance appraisal reflects actual performance, in this statement a vast majority of the respondents have agreed the statement. (7 per cent).it means the PA is properly conducted in this organisation. This outcome is correlated with the statement number 1 of this table. The statement regarding promotion it is based on the results of PA majority of the respondents (68per cent) have agreed. Only minimum numbers are disagreed. It shows that the importance of the PA system in an organisation. Whereas the statement regarding timely and effective feedback system followed in the organization a good number of the respondents (66 per cent) have agreed and only minimum numbers are disagreed (1 per cent). It is observed that the feedback system followed in the organisation is good. X. Findings, Suggestions Findings based on Socio demographic factors Majority of the respondents (%) are belonging to the age group below 5 years. It is found that this industry has more young Human resources. A vast majority of the respondents (9%) are male members though it is a manufacturing industry; the nature of the work is very hard perhaps most of the respondents are male. (5%) are unmarried. It reveals that there are more newly recruited employees. Half of the respondents (5%) receive salary between Rs Majority of the respondents (5%) have less than 5years of experience. It is seen that this industry is filling the vacancies immediately after the retirement of the employees. It is a good practice. Findings based on Performance Appraisal system The existing PA system is good. The PA system helps the employees to identify the areas of improvement. Employees have proper awareness on PA system. The PA system helps to assess the training needs of the employees. PA helps the employee to understand their ability and inability. The PA is periodically conducted in the organisation. Employees have the opportunity to express their views on PA system. The results of PA are properly communicated to the employees. The result of the performance appraisal reflects actual performance. The result of the PA helps to increase the job efficiency of the employees. Promotion is based on the results of PA in this organisation. It shows that the importance of the PA system in an organisation. The result of PA system plays a vital role in fixing of wage and increment. It is observed that the performance gets its value. The PA system conducted in the organisation is confidential, it is found the result of the PA system is not shown to others, because it is happened it may create quarrels between the employees. The subordinates are also involved in the PA system. It shows that the industrial democracy of the organisation. The PA system includes or covers of qualitative aspects, It is shown the PA system not only the technical part but also it covers the employees qualities like behaviour, interrelationship. There is a timely and effective feedback system followed in the organization. PA conducted in this organisation is without any partiality. XI. Hypothesis Based Findings A. Null Hypothesis There is no association between age of the respondents and their overall performance. 1 3 Age B e l o w 5yrs 6 t o 35yrs 3 6 t o 5yrs 6yrs & Performance appraisal system Low High (n=3) (n=16) (6.7%) 8 (3.5%) 7 (11.8%) (3.8%) 9 (56.3%) X = 38.3 Df = 3 P <.5 There is an association between age of the respondents and their is rejected and research hypothesis is accepted B. Null Hypothesis There is no association between gender of the respondents and their overall performance. All Rights Reserved, IJRMBS 15 9

5 International Journal of Research in Management & Business Studies (IJRMBS 15) Vol. Issue 1 Jan. - Mar. 15 ISSN : (Online) Performance appraisal system Gender Low High (n=3) (n=16) Male (1%) (75%) Female (5%) Inference X = 9.39 Df = 1 P <.5 There is an association between gender of the respondents and their is rejected and research hypothesis is accepted C. Null Hypothesis There is no association between experience of the respondents and their overall performance. Experience 1 Below 5yrs 6 to 1yrs 3 11 to 15yrs 16yrs & Performance Low (n=3) 6 (76.5%) 5 (1.7%) 3 (8.8%) High (n=16) 16 (1%) X = 5. Df = 3 P <.5 There is an association between experience of the respondents and their overall performance. Hence the null hypothesis is rejected and research hypothesis is accepted. Null Hypothesis There is no association between salary of the respondents and their overall performance. Salary 1 Below Rs.5 3 Rs.51 to Rs.1 Rs.11 to Rs.15 Rs.151& Performance Low High (n=3) (n=16) (5.9%) 7 (.6%) 5 (73.5%) 16 (1%) X = 5. Df = 3 P <.5 There is an association between salary of the respondents and their is rejected and research hypothesis is accepted. D. Null Hypothesis There is no association between gender of the respondents and their overall performance. T-test was used Overall Performance Mean S.D 1 Male (n=6) Female (n=) T = Df =8 P <.5 There is an association between gender of the respondents and their is rejected and research hypothesis is accepted. E. Null Hypothesis There is no association between marital status of the respondents and their overall performance. T-test was used in the hypothesis. Overall Performance Mean S.D 1 Unmarried (n=) Married (n=6) T = -6.7 Df =8 P <.5 There is an association between marital status of the respondents and their overall performance. Hence the null hypothesis is rejected and research hypothesis is accepted. XII. Suggestions There are some deviants or they have difference of opinion on the PA system or they may not interested in the PA system. The organisation has to identify them and give proper training to them to make involve in the organisation activities regularly. Further the HR professionals have to make the more pragmatic way. XIII. Conclusion Employee s performance appraisal is necessary to the industry to achieve the goals of the industry. It is the duty of every organisation to give proper training and improve the efficiency of the employees in a better way. Employees are considered as the valuable assets of all organisations. The progress of the employees is closely linked with the performance. If the performance is improved obviously the quality of the organisation is improved. In way the performance is an important factor to improve the quality of the employee as well as the industry. Here the study result clearly shown that the performance of the particular industry is good and effective and have a high influence in the socio demographic factors. Reference [1]. Aswathappa, K. (1997). Human Resources and Personal Management, New Delhi, Tata McGraw Hill publishing company. []. Biswajeet Pattanayak (), Human Resource Management, Prentice Hall of India Private Limited, 15, IJRMBS All Rights Reserved 3

6 ISSN : (Online) Vol. Issue 1 Jan. - Mar. 15 International Journal of Research in Management & Business Studies (IJRMBS 15) [3]. []. [5]. [6]. [7]. [8]. New Delhi. Devina Upadhyay& Anu Gupta (1) Efficacy of Performance Management System : An Empirical Study at ICICI Bank international Journal of Advanced Research in Management and Social Sciences ISSN: Vol. 1 No. 3 September 1 IJARMSS 16 Edward E. Lawler (1) Performance Management and Reward Systems Center for Effective Organizations, University of Southern California Ellen V. Rubin, (11). Appraising Performance Appraisal Systems in the Federal Government: A Literature Review, Preliminary Findings, and Prospects for Future Research The Public Management Research Conference Syracuse University Flippo, Edward. (1976). The Principales of Personal Management. Tokyo, McGraw Hillpublication Kogukush Limited. Gupta, C. B. (3), Human Resource Management, Himalaya Publication, New Delhi. Johannes Berge (1). Institute for the Study of Labor Performance Appraisals and the Impact of Forced Distribution: An Experimental Investigation IZA DP No. 5 schungs institute [9]. Kothari. C. R. (), Research Methodology, Wiswa Prakasan, Mumbai. [1]. Krishna Swami. D. R. (1993) Methodology of Research in Social Science, Himalaya Publishing House, Mumbai. [11]. Lawrence Kleiman. S. (3), Human Resource Management New Delhi, Bizantra. [1]. Miah Khasro, (1). Performance Management System in UK Retail Industry: A Case Study Far East Journal of Psychology and Business, Vol. 7 No. 3 [13]. Mamoria C. B. (3). Personnel Management, Himalaya Publication, New Delhi. [1]. Roger sumlin, (1). Performance management- Impacts & Trends White Paper, Development Dimensions international [15]. [16]. [17]. APPENDIX S. No. Particulars SDA DA N A SA Mean 1 Q1 % 11% 9% 8% 1% 3.93 Q % 6% 1% % 78%.18 3 Q3 17% 15% 11% 9% 8%. Q 8% % 5% 53% 1%.18 5 Q5 1% 19% 9% 5% 8%.3 6 Q6 % 1% % 56% 1%.7 7 Q7 15% 16% % 3% 8%. 8 Q8 % % 18% 58% 16%.1 9 Q9 % 8% 1% 7% %.9 1 Q1 8% 1% 1% 5% 18% Q11 % 1% 1% 5% %. 1 Q1 % % 6% 56% 1% Q13 6% % 1% 6% %.9 1 Q1 % % % 6% 1%.5 15 Q15 % 1% 16% 6% 6%. Author Profile Dr. J. Vincent Xavier is presently working at St. Joseph s College (Autonomous), Tiruchchirappalli, Tamil Nadu, India. This college is an A Grade (NAAC) CPE (UGC), and 17 years old institution. He workedon the capacity of Assistant Professor in the School of management studies. He also served as a guest faculty in Visual communication department in Periyar E.V.R. College, Tiruchirappalli. He has specialization in Human Resource management. Further hisdoctorate in Management and hasfocused upon Organisational Development practices with special reference to paper manufacturing industries. He has total experience of eighteen years to hiscredit which includes fouryears experience in developmental field andadministration management remaining fourteen years in academic field. He has published more than fifteen research articles in international and national level journals. All Rights Reserved, IJRMBS 15 31