Guidelines for New Performance Management System 1. Introduction to New Performance Management System Objectives To realign the Organizational/Departmental objectives with individual objectives Thrust on Performance Driven Culture To evaluate potential of the appraises\e to assure higher responsibilities, ex-cadre posts To identify the high performance for rewards Compliance of DPE instructions (OM dated 26.11.08 and 28.05.09) o Developing robust and transparent KPA based Performance Management System with Bell-Curve approach o Performance Appraisals to be consultative & transparent. The appraisal to be shared with the appraisee [28.05.2009] Applicability KPA based Performance Appraisal System is applicable to all executives of AAI (E1- E7) Executives who join AAI on deputation or those retaining lien while in service of AAI are also covered by this scheme Executives who join in the middle of the Key Performance Area based Performance Management System cycle (see next section), but have served for a minimum period of three months 2. KPA based Performance Appraisal System Cycle 2.1 Performance Assessment year Performance assessment year has been set up for the grades E1 to E7 as follows:- The performance assessment year commence from 1 st April of each year and continues until 31 st March for the following year. 2.1.1 KPA based Performance Appraisal System Calendar (2010 2011) No Activity/Steps Timeline Key Responsibility 1 Issue of KPA based Performance Appraisal Up to 30th July - HR Department System form 2010 2 Performance Planning 1 st Aug 31 th Aug - Executive 2010 - Reporting Officer 3 Submission of KPA based Performance 10 th Sep 2010 - Reporting Officer Appraisal System form after Performance Planning to HR 4 Issue of PMS form for Mid Year Review 20 th Nov 30 th - HR Department Nov 2010 5 Mid Year Performance Review 1 st Dec 15 th Dec - Executive 6 Submission of KPA based Performance Appraisal System Form after Mid-year Review to HR 7 Issue of KPA based Performance Appraisal System form for Annual Assessment 2010 - Reporting Officer 21 st Dec 2010 - Reporting Officer 15 th May 31 st May 2011 - HR Department Guidelines Page 1 of 17
8 Annual Assessment 1 st June 25 th June 2011 9 Submission of completed KPA based Performance Appraisal System form to HR Annexure-I - Executive - Reporting Officer - Reviewing Officer 30 th June 2011 - Reviewing Officer 10 Normalization of KPA based Performance Appraisal System 11 Performance Communication and Feedback to Executive 1 st July 25 th July 2011 - Performance Management Committee - HR to coordinate 31 st July 2011 - Reporting Officer (Administrative support from HR department) 2.2 KPA based Performance Appraisal System Process The KPA based Performance Appraisal System process is broadly divided into the following stages:- Performance Planning Mid Year Review Annual Assessment Normalization Feedback, Coaching and Counseling 2.2.1 Performance Planning Performance Planning is the process of: Defining expectations i.e. the work to be done, the results/targets to be achieved and skills/competencies needed to achieve these objectives Setting Measures and Targets, determining priorities and weightages of results to be achieved Identifying and allocating appropriate resources (such as manpower, tools, training, budget etc.) to enable the executive to achieve the targets While defining work objectives and measures, it is necessary to ensure that: Goals/Targets/Objectives are SMART (Specific, Measurable, Agreed, Realistic and Time bound) Results are substantially within the executive s control Measures relate to results Data is available for measurement Agreement on mutually agreeable and achievable performance targets is arrived at after sufficient discussion between reporting officer and executive has taken place. 2.2.2 Mid Year Review Performance management is not an event but an ongoing process. Mid year reviews help in the following ways: Reinforcing good performance in time Updating the status of targets i.e. progress review Identifying areas for mid-course correction Guidelines Page 2 of 17
Revisiting KPAs and goals, if necessary Assessing resource and skill requirements affecting the individual s performance. Discussion and feedback on functional competencies, managerial competencies, potential competencies and core values actualization Providing early warnings of non-performance, i.e. avoiding year end surprises 2.2.3 Annual Assessment The objectives of Annual Assessment are to: Discuss and arrive at an assessment of performance with respect to agreed targets Assess the competencies, potential and core values actualization by the individual Agree upon improvement plans and development needs for the individual. 2.2.4 Normalization The objectives of the Normalization System in Key Performance Area based Performance Appraisal System are to: Ensure parity and integrity by minimizing variation in rating by different reporting officers across various departments and locations. Enhance objectivity and transparency in the appraisal system To view individual performance from the perspective of organizational achievement. 2.2.5 Feedback and Counseling In order to make Key Performance Area based Performance Appraisal System an open system and to enhance development orientation across the organization; feedback and counseling are essential components. Communicating the final performance results of the executive and providing developmental feedback are critical to this process. 2.2.5.1 Feedback Providing feedback on performance presents the following benefits: Creates transparency making Key Performance Area based Performance Appraisal System more acceptable to individuals Reinforces good performance on time Enables development of coaching and mentoring relationship between reporting officer and executive Ensure that organizational objectives are achieved to an acceptable standard and in an acceptable form Providing performance feedback is a delicate matter and the reporting officer should create suitable conditions for providing performance feedback in the most effective manner (Refer to appendix for tips to reporting officers on conducting effective appraisal meetings.) In general: Feedback should be focused on the specific performance actions and not on the personality of the executive Feedback should be generated after reviewing all achievements and issues throughout the assessment period and not focused on isolated incidents. Feedback calls for maintaining a log of critical incidents occurring during the assessment period for recording both achievements and failures with details, as an aid to memory during performance discussions with the executive. Feedback to be given as regularly as possible so that enough opportunities are created for executive to bridge performance gaps through self-development. Guidelines Page 3 of 17
2.2.5.2 Counseling Counseling in the KPA based Performance Appraisal System context essentially is a process by which executives can receive assistance in sorting out issues related to current and future responsibilities and aspirations. Therefore, reporting officers are required to encourage individuals to plan for their own self development. The process of counseling is through: Recognition and understanding of existing strengths Empowering i.e. enabling the individual to recognize their own problems and expressing the same. Facilitating action through guidance and expertise, i.e. facilitating the process whereby the individual evaluates alternatives and formulates action plans to achieve the most suitable course of action. Helping individuals to take ownership of the outcomes of their chosen action. Coaching and counseling together act as a feedback mechanism for the individual on his/her performance. It is often used by reviewer/reporting officer to communicate the areas for development and improvement to the executive. 3. KPA based Performance Appraisal System Linkage with Other HR systems Performance Management has much wider implications than purely improving individual performance in the given year. KPA based Performance Appraisal System provides the basis for achieving a number of fundamental aims of HR Strategy for the organization as mentioned below:- 3.1 Linkage with Training and Development system KPA based Performance Appraisal System lays strong emphasis on continuous learning and development. The two-way communication between reporting officer and executive creates an environment of trust and self learning KPA based Performance Appraisal System is the basis for the organization to maintain data on an individual s skill gaps, take necessary action to meet the training needs, use it for foreign training/assignments and company sponsorship of long-term educational programs etc. KPA based Performance Appraisal System would also provide the means to determine the collective level of competencies and strengths available within the organization as well as gaps for planning for organizational development initiatives. Learning and development initiatives fundamentally rest with the individual with the organization facilitating the same through creating a learning environment and providing suitable opportunities etc. The executive would be responsible for making use of the same to the maximum extent possible. 4. The KPA based Performance Appraisal System Form The KPA based Performance Appraisal System form is divided into seven parts 1. Performance Planning and Assessment - Part I 2. Mid Year Review - Part - II 3. Performance Planning and Assessment - Part - III 4. Managerial Competencies Assessment - Part - IV 5. Core Values - Part - V 6. Potential Appraisal - Part VI 7. Special Achievement - Part - VII 8. Individual Training and Development Plan - Part VIII 9. Total Marks - Part IX 10. Alteration of KPAs during Mid-Year Review - Part - X Guidelines Page 4 of 17
4.1 Performance Planning (Refer to Parts I and II of KPA based Performance Appraisal System form) Performance Planning is to be done through a process of discussion between the executive and the reporting officer to arrive at the performance targets for the Key Performance Areas. (i) In the beginning of the assessment year, the concerned HR department shall circulate the relevant KPA based Performance Appraisal System forms to the reporting officers for Performance Planning with the respective executives. (ii) The reporting officer will then send the KPA based Performance Appraisal System form to each executive reporting to him with a covering letter inviting him to participate in the performance planning process indicating time and venue and requesting the executive to complete the relevant sections of the form prior to the meeting. See annexure for format of invitation letter. 4.1.1 Identifying KPAs 1. The table entitled Key Performance Areas (KPA): Planning (Part I) is a summary of the detailed KPAs to be filled up by the executive after discussion with reporting officer in the subsequent pages of the KPA based Performance Appraisal System form. 2. At the beginning of the year, relevant KPAs are identified using the KPA Directory (which has to be prepared by individual departments), as a reference tool. KPAs may be enhanced or modified depending upon the individual after discussions with the reporting officer. 3. The KPAs should be cascaded in an open and transparent manner with each reporting officer sharing his/her KPAs and targets with all the executives reporting to him/her. 4. The KPAs thus identified are written down in the column provided for KPA Planning in the table in Part I. 5. Total marks to be allocated to each item in the KPA index is agreed between the reporting officer and the executive and assigned accordingly. 6. The marks provided in the KPA Directory are indicative only and may be modified in consultation with the reporting officer. 7. The column for Marks Obtained is filled up only at the end of the assessment year. 4.1.2 Identifying KPA constituents and measures 1. Once the KPAs are identified, their constituents, measures and targets are also identified from the KPA Directory. These are agreed upon between the reporting officer and the executive at the beginning of the assessment year. 2. The details of KPA should be provided as an attachment in a separate sheet for detailing the constituents of the KPA Planning agreed upon. 3. Total Marks to be allocated to each of the KPA constituents are agreed between the reporting officer and the executive. These are filled against the relevant KPA constituent. The sum of the marks provided to the KPA constituents should be equal to the total marks allocated to the KPA Index. 4. The constituents, measures and marks provided in the KPA Directory are guidelines and may be modified by the reporting officer in consultation with the executive (the changes may be aligned as per business/functional plans, focus areas, priorities of the management, unit/department level goals etc.). 5. At the beginning of the year, the reporting officer and the executive sign off the agreed KPA targets in the space provided in Part I of the KPA based Performance Appraisal System form. 6. After the targets are agreed, the relevant column in the table is filled. Guidelines Page 5 of 17
7. At this time, the reporting officer and the executive discuss in detail the identification and allocation of the various resources required by the executive (manpower, budget, tools, training etc.) to achieve the targets. 8. The column for Marks Obtained are filled at the end of Assessment Year. 4.1.3 Identifying Managerial Competencies (Part IV of form) 1. Managerial Competencies are those that are essential for the business to achieve its strategy and typically involve behavioral descriptors. 2. A set of managerial competencies is provided in Part IV of the KPA based Performance Appraisal System form. 3. Descriptions of each competency as applicable to a particular level are available in the annexure to this policy document. 4. Seven competencies are to be assessed of which four have been identified as mandatory for that level. 5. The reporting officer and the executive need to identify three additional managerial competencies, which are department specific (to be provided by individual department). These competencies are to be chosen based on the responsibilities and demands of the executive current job. 6. The optional competencies should be directly and significantly related to the executive s areas of responsibilities. 7. The total managerial competencies on which the executive will be assessed would thus be seven. 8. The reporting officer and executive sign off on the managerial competencies in the space provided in Part IV of the KPA based Performance Appraisal System form at the beginning of the year. 4.2 Mid Year Review (Refer to Part II of the KPA based Performance Appraisal System Form) 1. The concerned HR department shall resubmit the KPA based Performance Appraisal System forms to the reporting officers for Mid-Year Review with the respective executives. 2. The reporting officer will send the KPA based Performance Appraisal System form to each executive reporting to him with a covering letter inviting him to participate in the Mid Year review indicating time and venue and requesting the executive to complete the relevant sections of the form prior to the meeting. 3. The reporting officer and executive jointly review the performance in the mid Year Review as per the schedule mentioned in the KPA based Performance Appraisal System Calendar. 4.2.1 Mid Year Assessment 1. The executive completes the self evaluation section where he/she highlights achievements to date. Further, he/she indicates roadblocks and issues faced as well as efforts made by him/her to overcome them including help/assistance obtained from the reporting officer. 2. The reporting officer records progress and performance in the space provided for Comments of Reporting Officer. The comments should include feedback on KPA Progress, functional competencies, managerial competencies, potential competencies and core values actualization. 3. Both the reporting officer and executive set aside some time to discuss the achievements and issues highlighted by the executive. The Mid-year Review is an important opportunity for the reporting officer to provide feedback on the performance to date. Guidelines Page 6 of 17
4. The reporting officer and executive sign off Part II of the KPA based Performance Appraisal System Form as an agreement to the amendments and comments in the Mid Year Review. 4.2.2 Alternation of KPAs during Mid-Year Review 1. Part X of the KPA based Performance Appraisal System form is to be used only if changes need to be made to the KPAs, measures, weightages, marks or targets. In such a case, all the KPAs need to be refilled. 2. The reasons for change need to be cited at the end of the section. 3. The KPAs may be changed under the following circumstances: a) There is a significant change in the roles and responsibilities of the executive b) There are changes in the strategic business objectives of AAI that directly impact the KPA or the specific KPA loses relevance, as in the following cases:- Un-anticipated projects Abandonment of projects as per corporate directives Situations completely out of the control of the executive such as accidents, terrorism and other emergency situations. 4. It is strongly advised not to be lenient in changing KPA targets, marks or weightages and to strictly follow the guidelines before making such changes during the Mid-year Review 5. After consultation with the Reviewing Officer regarding the need and rationale for midyear alteration, the changes to the KPAs would be signed off by the reporting officer and the executive in the space provided in the KPA based Performance Appraisal System form. 4.2.3 Submission of KPA based Performance Appraisal System forms after Mid- Year Review 1. After completion of Mid-year Review, the completed KPA based Performance Appraisal System forms shall be submitted to the concerned HR by the reporting officer within the deadlines set in the calendar. 4.3 Annual Assessment 4.3.1 Re-submission of KPA based Performance Appraisal System forms for Annual Assessment 1. The concerned HR shall trigger the process of completion of annual assessment through resubmission of KPA based Performance Appraisal System forms to all reporting officers. 2. The reporting officer will send the KPA based Performance Appraisal System form to each executive reporting to him with a covering letter inviting him to participate in the Annual Assessment indicating time and venue and requesting the executive to complete the relevant sections of the form prior to the meeting. See Annexure for format of invitation letter. 4.3.2 Guidelines for annual Assessment of KPAs 1. The annual assessment starts with the KPA Planning table in Part I. If the KPA targets have been revised during the mid-year-review, then the final review for KPA starts with Details of KPA table in Part X. 2. The Actual Target achieved by the executive against the KPA constituent is written by the executive in the column Actual Target Achieved. Guidelines Page 7 of 17
3. The marks obtained under each KPA constituent add up to the total score for a KPA Index. These scores are written down in the summary table under the head Key Performance Areas (KPA) Annual Assessment by the reporting officer. 4. The total marks for this section are calculated as per the formula provided in the KPA based Performance Appraisal System form. 4.3.3 Guidelines for Assessment of Managerial Competencies (Refer to Part IV of KPA based Performance Appraisal System form) I. The reporting officer shall discuss each of the mandatory and the optional (as selected at the beginning of the year) managerial competencies with the executive and assign the rating on the form. II. The competencies are to be evaluated on a ten-point scale as indicated in the KPA based Performance Appraisal System form by referring to the detailed behavioral descriptors for each managerial competency. III. The aggregate marks are arrived at by adding all marks scored for the seven managerial competencies. IV. The reporting officer and executive sign off Part IV of the KPA based Performance Appraisal System Form as an agreement on the assessment (rating) of the Managerial Competencies for the executive. 4.3.4 Guidelines for Assessment of Core Values (Refer to Part V of KPA based Performance Appraisal System form) Adoption of the company s Core Values in business dealings is an essential duty of executives at all levels. 1. All executives have a major role in the actualization of Core Values by being Role Models in observing and practicing them and thereby leading by example. 2. Value actualization is assessed by observing the demonstrated behavior of the executive in day-to-day business dealings. 3. Core Values assessment is to be done at the end of the year on a ten-point scale as indicated in the KPA based Performance Appraisal System form. 4. At the year-end, the reporting officer shall discuss each of the value descriptions with the executive and indicate the rating on the KPA based Performance Appraisal System form. 5. The aggregate marks are arrived at by adding all marks scored for different core values. 6. The total marks obtained for the section is calculated by using the formula provided. 7. The reporting officer and executive sign off Part V of the KPA based Performance Appraisal System Form as an agreement on the assessment on Core Values of the executive. 4.3.5 Guidelines for Assessment of Potential (Refer to Part VI of KPA based Performance Appraisal System form) 1. Potential appraisal helps in understanding the extent to which the executive is demonstrating competencies of higher levels. 2. Evaluating these competencies will help in appreciating the preparedness/suitability of the executive for higher responsibilities along the hierarchy. 3. The prescribed potential competencies for a particular level are printed in the KPA based Performance Appraisal System form for the particular level. 4. The desired behavioral descriptors for each potential competency are provided in the annexure to this policy document. 5. The competencies are evaluated annually on a 3-point scale as indicated in the KPA based Performance Appraisal System form during the year-end assessment. 6. The reporting officer shall discuss each of the competencies with the executive and plot the rating on the form. 7. The aggregate marks are arrived at by adding all marks scored for different competencies. Guidelines Page 8 of 17
8. At the end of the assessment year, the reporting officer and executive sign off Part IV of the KPA based Performance Appraisal System Form as an agreement on the assessment on the potential appraisal of the executive. 4.3.6 Guidelines for Completing the Special Achievements Section 1. Special Achievements appraisal helps in understanding the extent to which the executive is contributing in terms of special accomplishments that adds value to the organization. 2. Evaluating these competencies will help in appreciating the executive s contribution for individual/group accomplishments. 3. There are no prescribed titles in the KPA based Performance Appraisal System form for Special Achievements Section. The executive can mention his/his team s area of achievement and describe in contribution in that achievement. 4.3.7 Summary of Scores (Refer to Part IX of KPA based Performance Appraisal System form) 1. At the end of the assessment year after completing each of the parts of the KPA based Performance Appraisal System form, the reporting officer summarizes the total of each part of KPA based Performance Appraisal System form in the column Marks Obtained in Part IX (Section A) of the form. 2. The Total Marks is the sum of marks obtained in each section of the KPA based Performance Appraisal System form. 3. The KPA based Performance Appraisal System form duly signed by the executive and the reporting officer is then submitted to the Reviewing Officer for discussion, comments and approval. 4. The Reviewing Officer shall go through the performance of the executive in totality as finally brought out by the Reporting Officer indicating details of marks obtained under each section: Performance, Competencies, Core Values and Potential, before offering comments, if any. 5. If Reviewing officer feels the necessity of reviewing the appraisal of the executive, then there should be a detailed discussion with the reporting officer on each of the components of the KPA based Performance Appraisal System form. 6. After arriving at a fair decision and accounting for the views of reporting officer, the Reviewing Officer may offer comments and rationale for changing the scores in the relevant column under Part IX (Section B) of the form. 7. After discussion and mutual consent, the reporting officer and Reviewing Officer will duly sign the KPA based Performance Appraisal System form. 8. The completed KPA based Performance Appraisal System form of the executive is sent to the HR department who will convene the Performance Management Committee for normalization. 4.3.8 Guidelines for Completing Individual Training and Development Plan (Refer to Part VIII of KPA based Performance Appraisal System form) KPA based Performance Appraisal System provides the opportunity to capture the developmental needs of the executive in the Individuals Development Plan. The ratings in the functional and managerial competencies provide the basis for identifying the training and development needs of the executive. 1. The development needs identified should be such that they facilitate the executive in immediate performance. 2. The reporting officer should identify specific competency gaps based on competency assessment and potential assessment (Parts IV and VI, respectively) and suggest developmental initiative/training and time frame for the same. Guidelines Page 9 of 17
3. At the end of the assessment year, the reporting officer and executive sign off Part VIII of the KPA based Performance Appraisal System Form as an agreement on the Individual Development Plans for the executive for the next period. 4. After receipt of completed KPA based Performance Appraisal System forms, the concerned HR would be instructed at the appropriate time to arrange all the Part VIII forms and send the Competent Authority/Institution(s) 5. The concerned HRD/EDC/PMI would use these forms as an input for them to develop the training calendars and design appropriate training Programmes for the following year. 5. Roles and Responsibilities 5.1 Role of Executive: The executive shall fill out appropriate portions of the form, attend the KPA based Performance Appraisal System meetings at all stages (performance planning, mid-year review and annual assessment) and be prepared to have an open and frank discussion about his/her performance. The KPA based Performance Appraisal System aims at creating amity and convergence of individual and organizational goals and it should be taken in that spirit. The executive is required to show the necessary flexibility and adaptability to the organizational needs and display system discipline through adherence to all KPA based Performance Appraisal System requirements. 5.2 Role of Reporting Officer The reporting officer shall cascade the KPAs based on MOU targets to the executives reporting to him in a fair and achievable manner. The reporting officer should set up performance planning, mid-year review and annual assessment meetings with all the executives reporting to him within the specified periods as per the KPA based Performance Appraisal System calendar. The reporting officer shall maintain a brief log of all critical incidents occurring within his scope for work as an aid to memory while completing the mid year review, annual assessment and giving feedback to the executive. The reporting officer shall carry out the KPA based Performance Appraisal System scoring of all executives reporting to him in an objective manner and such that the scores are distributed in a manner requiring minimum adjustment and/or normalization by either the reviewing officer or the Performance Management Committee. In the event of change of KPAs, measures, targets etc., the reporting officer is required to obtain clearance from Reviewing Officer prior to making the change. 5.3 Role of Reviewing Officer The reviewing officer shall go through KPA based Performance Appraisal System forms for all executives under his purview and ensure that the reporting officer has been objective and unbiased in his scoring of various executives, particularly with respect to the sections relating to Competencies, Values and Potential Where required, the reviewing officer may recommend some changes to the scores after carrying out a detailed discussion with the respective reporting officer. The reviewing officer shall also carry out an integrity check to ensure that the scores awarded to all the executives under his/her purview are distributed in a manner requiring minimum normalization by the Performance Management Committee. Where an executive has a grievance against the reporting officer regarding the KPA based Performance Appraisal System process, the reviewing officer shall intervene and settle the grievance in a fair and objective manner. The Reviewing Officer shall cascade the KPAs in an open and transparent manner with each reporting officer by sharing his KPAs and targets. Guidelines Page 10 of 17
5.4 Role of Nodal Officer A Nodal Officer would be designated for each location (station/region/corporate) The Nodal Officer would be responsible for implementing KPA based Performance Appraisal System as well as for periodic administration, follow-up, tracking and analysis of KPA based Performance Appraisal System activities as per schedule in his/her respective location. To ensure collection, collation and forwarding the Individual Development Needs forms to the concerned EDC/Regional HRD/PMI 6 Normalization Process The Normalization Process would result in all executives placed within a cluster would be categorized as follows: Top - 15% of the cluster Middle - 75% of the cluster Bottom - 10% of the cluster Further details of the Normalization process would be communicated at the appropriate time. 7. Communication and Feedback of Scores 1. After the process of normalization of the scores is completed, the Performance Management Committee hands over all the KPA based Performance Appraisal System forms to the respective HR Department. 2. HR then consolidates final scores, relative rankings and the feedback from the Performance Management Committee for all executives. 3. HR prepares a summary sheet of scores, relative ranking and feedback from Performance Management Committee for the executives under each reporting officer along with the individual feedback forms, duly filled (see Annexure for format) and sends the same to the reporting Officers. 4. The concerned reporting officer signs off the individual feedback forms as per the summary sheet provided by HR and hands over the same to the executives in order to communicate the final scores relative ranking and the feedback. 8. Administration of KPA based Performance Appraisal System 1. Executive Directors / General Managers / Sectional Head will facilitate implementation of KPA based Performance Appraisal System by monitoring progress removing any difficulties or roadblocks and ensuring completion of assessment and submission to HR as per the dates provided in the KPA based Performance Appraisal System calendar for their respective Units/Departments/Regions. 2. The concerned business unit head/functional head should cascade his KPAs to the executives reporting to him based on MOU targets for that year with suitable targets to ensure organizational excellence. This process may be finalized in an SMC meeting. Departmental group heads meetings as the case may be, which is to be held in the second half of March of each assessment year. 3. The primary responsibility for filling up the KPA based Performance Appraisal System form and setting the process in motion rests jointly with the reporting officer and the executive as per the time frame provided. 4. Any difficulty or difference that may rise between the reporting officer and the executive in the process of implementation of the system would be sorted out the through the intervention of the Reviewing Officer. If the executive is still not satisfied with the decision of the reviewing officer, especially in the case of annual assessment and/or the final score awarded by the PMC, then the concerned executive may place his case before the next higher authority above the PMC. Guidelines Page 11 of 17
5. If any executive does not participate in the KPA based Performance Appraisal System process (setting up KPAs, attending mid-year review or annual assessment meetings, filling relevant sections of the form etc. on time) despite being given ample opportunity to do so, the reporting officer has the authority to complete the form in the absence of the executive and forward the same to the Reviewing Officer indicating the non-participation of the executive. The Reviewing Officer may offer an opportunity to the executive to be heard. Having verified that indeed the executive has voluntarily decided not to participate in the process despite being given sufficient opportunity, the Reviewing Officer forwards the form to HR, duly completed and with his approval of the process followed under the circumstances. 6. In the event of the creation of a new role or department, the concerned HR department will develop KPAs and functional Competencies for that particular role/department in consultation with the respective head of department. Also, if for an existing role, new competencies/kpas are required to be added, the concerned HR department would compile the same in consultation with the respective head of department. Such new roles or competencies defined should be validated with Corporate HRD. 7. The key role for HR department in the KPA based Performance Appraisal System administration is to : Issue KPA based Performance Appraisal System forms as per the KPA based Performance Appraisal System calendar Collect forms as per schedule Monitor adherence to dates Highlight non-compliance/exceptions to top management Send copy of individual training and development plan to concerned HRD/EDC/PMI Convene Performance Management Committee meetings Consolidate feedback, final scores and relative ranking of all executives Prepare Final Score Feedback Form for each executive and provide to respective reporting officers. 8. The responsibility across various levels and locations for KPA based Performance Appraisal System administration lies with the KPA based Performance Appraisal System Officers, so designated at each Station, Region and Corporate. 9. Convening responsibility of the Performance Management Committees would be provided at the appropriate time. 8.1 Transfers 8.1.1 Executive and/or reporting officer transferred during assessment Year: a. If the executive or the reporting officer has spent less than 3 months of the assessment year prior to transfer from the department, then no assessment needs to be carried out for the executive for that period by that reporting officer. Fresh KPAs will have to be issued by the new reporting officer in the new department/location and these will form the basis of the executive s annual assessment for that year, which will be done solely by the new reporting officer. The total score for normalization will be provided by the new KPA based Performance Appraisal System form only and the normalization cluster would be based on the executive s new position. b. If the executive or the reporting officer has spent more than 3 months of the assessment year prior to transfer from the department, then an assessment must be carried out for the executive duly signed off by the reporting or the relevant period followed by a review of the same by the Reviewing Officer. Guidelines Page 12 of 17
Fresh KPAs will have to be issued by the new reporting officer and the executive s annual assessment for that year will comprise both the old as well as the new KPA based Performance Appraisal System forms, duly signed off by the respective reporting officers. The total score for normalization will be provided by both the KPA based Performance Appraisal System forms proportionate to the amount of time spent in each department. The normalization cluster would be based on the executive s new position. 8.1.2 Executive promoted during the year : a. Executives promoted during the assessment year would be issued new KPA based Performance Appraisal System forms, if promotion is accompanied by change in role-band or change of job responsibility or transfer. b. If an executive is promoted within the same role band and continues to remain in the same department under the same reporting officer with substantially the same responsibilities and KPAs, then the existing KPA based Performance Appraisal System format will continue to be used. At the end of the year, he is assessed on the same KPAs and the total score for normalization purpose is also derived from it. The executive will be normalized in the cluster applicable after promotion. If some responsibilities are added as a result of promotion, the same can be incorporated in the KPA based Performance Appraisal System format during the Mid-Year Review. c. If an executive promoted along with a change in role band, then a fresh KPA based Performance Appraisal System form will have to be filled appropriate to the role band and fresh KPAs will need to be agreed upon. Furthermore, the executive will be normalized in a cluster as per his new grade and function The total score for the year would be calculated using the same 3 months minimum service principle as in point 8.1.1 above. The respective HR department have to ensure that KPA based Performance Appraisal System forms are filled and signed off if an executive has served for a minimum period of 3 months either in the location or under a particular reporting officer or within a role band. The release order for the executive/reporting officer will be issued subject to the fulfillment of this. Thereafter, HR needs to coordinate with the other HR department where the executive has been transferred to communicate the proportionate weightage of total score to be used for calculating the final score. 9. Audit of KPA based Performance Appraisal System To achieve the objectives of the KPA based Performance Appraisal System, an audit procedure has been put in place to ensure that all users follow KPA based Performance Appraisal System guidelines consistently. Further information on the KPA based Performance Appraisal System audit process would be made available at the appropriate time. 10. General The powers to modify, cancel, add or amend any of the provisions of the KPA based Performance Appraisal System policy at any time rests with the Chairman of AAI. Guidelines Page 13 of 17
11. APPENDICES 11.1 Useful Guidelines for carrying out KPA based Performance Appraisal System The following checklist must be used to ensure completion of all KPA based Performance Appraisal System activities: Performance Planning Mid-Year Review Annual Assessment KPAs and constituents Performance progress to to be identified and be discussed (KPAs, written in the KPA based Competencies, Potential Performance Appraisal and Core values) System form Self evaluation to be Source: KPA Directory Three levels of Targets to be set Functional/Technical discussed and competencies to be identified and written Source: Directory Optional Competency Managerial Competencies to be identified and ticked in the KPA based Performance Appraisal System form Sign off by the executive and reporting officer documented Document changes in KPAs if necessary Comments of reporting Officer to be documented Sign off by the executive and reporting officer Marks to be given for target achieved against KPAs. Summary of KPA marks to be filled in dashboard. Competencies to be rated. Core values to be rated Potential to be rated Summary of scores Discuss and fill training and development plan Sign of by the executive and reporting officer 11.2 Tips for Reporting Officer to conduct Assessment Meeting There are eight simple steps that a reporting officer must follow in order to conduct an effective assessment meeting. 1. Control the atmosphere: Be prepared, create trust and understanding by putting the executive at ease. Avoid interruptions while the executive is communicating. 2. State the purpose of the discussion: Discuss the advantages of the discussion including: a. Assessment of progress towards goals b. Identification of ways to improve performance c. Identification of current or potential problems d. Improvement in communication 3. Ask for the executive s opinion: Ask executive to discuss what/he/she has written in self-appraisal. Ask clarifying questions, if needed. Listen carefully and attentively. Keep an open mind. Control your emotions or defensive reactions. 4. Present your assessment: Speak in detail, giving factual information. Be open, candid and specific, giving both good news and bad news. 5. Build on executive s strengths: This will lay the groundwork for a positive approach for future performance. Specifically: a) Ask the executive to name his/her strengths b) Share your opinion of the executive s strengths c) Recap the strengths you have discussed and relate them to specific future goals. d) Focus on performance and not the person. e) Be aware of not focusing too much on recent events; take the entire year s performance into consideration. Guidelines Page 14 of 17
5. Ask for executive s reaction to your assessment: Be prepared for executive s disagreement on your assessment. He/she may also feel unhappy or emotionally upset. Stay open and do not react in a defensive manner. Resist the temptation to gloss over serious issues. 6. Discuss specific goals: Set specific future goals for performance as well as training and development needs. Discuss career progression at this stage and the steps to be taken to achieve the same. 7. Close the discussion: Plan for a good ending. Summarize the discussion and discuss the scheduled next steps. 11.3 Tips on providing feedback i. Provide feedback on actual events ii. Describe, Don t judge iii. Refer to specific behavior iv. Select issues and restrict to those v. Focus on aspect of performance that the individual can improve upon. vi. Provide positive feedback 11.4 Tips for implementing KPA based Performance Appraisal System The most objectively designed performance management system in the world can fail if it is not implemented with care and caution. By following the simple tips mentioned below KPA based Performance Appraisal System can be implemented successfully. What to do Steps Ensure frequent communication Ensure frequent two-way communication between reporting officers and executives Take active steps to remove obstacles limiting executive performance. Create an atmosphere where executives are encouraged to ask question and clarifications. Ensure that executive s perceptions of performance match the reporting officer s Mutually agreed upon goals Share and communicate goals received from top management for your unit/department Involve executives in goal-setting Document them so that there is a common understanding of what is expected Evaluate your own performance Take time to evaluate your own first performance first Get feedback from others (peers and superiors) to see how well you are creating an achieving atmosphere for your executives. Guidelines Page 15 of 17
Document performance between appraisal meetings Prepare yourself and the executive for the discussion Annexure-I Document examples of superior performance or attitude Document failures to achieve and poor behavior Avoid effect o the most recent event (halo effect or horn effect) Set a date, time and place after consulting with executive Ensure that executive is aware of the purpose of the meeting. Show the same professional courtesy that is awarded to any business associate Give the executive the opportunity to ask clarifying questions prior to and during the meeting. Conduct the meeting successfully Control the environment and do not allow interruptions Put the executive at ease Plan your opening remarks State the purpose of the discussion and the information being used (e.g. statement of goals, written documentation, peer feedback etc.) Ask for executive s opinion Ensure that executive does most of the talking Ask open ended questions that start with Tell me how, why do you think, and so on that provide an executive to open up and talk at greater length. Be open, candid and specific Present your assessment openly, clearly and rationally Be prepared to present the facts and rationale if challenged Give both good and bad news Discuss executive accomplishments Focus on performance, not personality Close the discussion in a professional manner Summarize the discussion Ask for executive s impression on how the meeting went Thank the executive Explain the follow-up steps Guidelines Page 16 of 17
12. ANNEXURES 12.1 Distribution of Marks S. KPA based Performance Appraisal System Parameter E-1 E-7 No. 1 KPA 60 2 Managerial Competency Assessment 15 3 Core Value Assessment 10 4 Potential Assessment 10 5 Special Achievement 5 TOTAL 100 12.2 Rating Scale for Assessment of competencies Level Competency Needs Development Meets Expectations Moderately expectations of above Significantly Exceeds Expectations Description for assessing Functional and Managerial Competencies Is able to demonstrate the competency on some occasions on the job. Displays some of the behaviors as indicated for the managerial competency. There are specific areas of development of which training interventions are required. Is able to demonstrate the competency effectively on almost all occasions on the job with minimum supervision and training intervention. Displays all behaviors as indicated for the managerial competency. Is prepared to develop higher levels of the competency. Is able to demonstrate the competency at a significantly higher level than tat required to carry out the assigned job on several occasions and though not an expert in the competency, has the potential to be one and can be developed with minimum. Besides demonstrating the competency effectively required for the specific level is viewed as an internal expert in this competency. Peers seek his opinion across the unit/company in his domain. Uses current expertise/behavioral capability to provide coaching, guidance and transferring knowledge to subordinates and peers by conducting training programs. Represents the organization s capability to external agencies. 12.3 Rating scale for Potential Assessment Distribution of Rating Scores 1 to 2 3 to 5 6 to 8 9 to 10 Level of Competency Description Distribution of Rating Scores Needs Coaching and Development Is a learner and has not yet demonstrated the 1 to 3 behavior/skill required for the competency as per description and requires a high degree of coaching and guidance to do so. Somewhat Demonstrates Competency Always Demonstrates Competency Demonstrates some of the behaviors of the relevant competency as per description with minimal coaching and guidance. Repeatedly and characteristically demonstrates all behaviors of relevant competency as per description without much coaching and guidance and is a role model for others. 4 to 7 8 to 10 Guidelines Page 17 of 17
I Period of Assessment Performance and Competence Assessment Form Level E 1 to E 7 Date From Date To Executive Name Employee Number Date of Birth Department Date of Joining current Department/location Designation Level Section Date of Existing Grade Qualification Ratings Held (For ATM & CNS) Reporting Officer Name Employee Number Location/Unit Designation Level Reviewing Officer Name Employee Number Location/Unit Designation Level Date and Signature of Reporting Officer & Executive Event Date (To be filled by Reporting Officer) Signature Of Executive Signature of Reporting Officer KPA Setting & Competency Identification Mid Year Review Annual Assessment Page 1 of 10 Developed by MIS
I Employee Number Part I: Performance Planning and Assessment Maximum Marks: 60 Key Performance Areas (KPA): Planning To be filled at the beginning of the year S.No. KPA Maximum Marks 1 2 3 4 5 6 Total Score 100 Signature of Executive Signature of Reporting Officer Signature of Reviewing Officer Constituent of KPA s should be given in separate sheet and should be attached to form Page 2 of 10 Developed by MIS
Part II: Mid Year Review Employee Number Annexure-II Mid Year Self Assessment by Executive S.No. KPA Achievement Road Block / Management Support Required Other Achievement Assessment by reporting Officer S.No. KPA Comments on Achievement Plan for removal of Road Block / Management Support Comments on Other Achievement Signature of Executive Signature of Reporting Officer Page 3 of 10 Developed by MIS
Employee Number Annexure-II Part III: Performance Planning and Assessment Maximum Marks: 60 Key Performance Areas (KPA) Annual Assessment To be filled at the end of the year S.No. KPA Maximum Marks Marks Obtained 1 2 3 4 5 6 Total Score 100 KPA Marks = Total Score x 60 100 = Signature of Executive Signature of Reporting Officer Page 4 of 10 Developed by MIS
Employee Number Annexure-II Part IV: Managerial Competencies Assessment Maximum Marks: 15 S.No. Managerial Competencies Ratings ( to be evaluated on the scale of 1 to 10) 1 Leadership: Demonstrates ability for guiding collective decision making for succession planning, crises management and ability to take risk. 2 Business Attitude: Commitment to bottom line results by addressing interest of customers and stakeholders. 3 Communication: Communicate ideas & information effectively and ability to convert ideas through action plan. 4 Cost Consciousness: Works on the principal of maximum output from minimum input with least amount of waste. 5 6 7 Total Score out of 70 Note: Three competencies are based on discipline of the executive and to be chosen from discipline based managerial competency bank. At the end of the year Marks = Total Score x 15 70 = Signature of Executive Signature of Reporting Officer Page 5 of 10 Developed by MIS
I Employee Number Part V: Core Values Maximum Marks: 10 To be filled at the end of the year S.No. Core Values Ratings ( to be evaluated on the scale of 1 to 10) 1 Business Ethics: Exhibits a high level of morality & fairness in all his actions; is transparent in his dealings; complies with guidelines. 2 Customer Focus: Has conviction that the customer is the centre of all the activity. 3 Organizational Pride & Professional Pride: Holds his company and profession in high esteem & takes pride in belonging to it. 4 Mutual Respect & Trust: Has high regard & faith in the fellow organizational members; believes in collaboration & openness & has good team spirit. 5 Innovation & Speed: Thinking new & ahead & being swift without compromising on quality; is creative & innovative & has the willingness to experiment. 6 Total Quality Management: Believes in pursuing excellence in all spheres of activity; make continuous efforts in improving standards of performance, systems and processes. 7 Candour: Frank & forthright; Give & receive constructive criticism/suggestion; appreciate good performance. Total Score out of 70 Marks = Total Score x 10 70 = Signature of Reporting Officer Page 6 of 10 Developed by MIS
I Employee Number Part VI: Potential Appraisal Maximum Marks: 10 To be filled at the end of the year S.No. Potential Competencies Ratings ( to be evaluated on the scale of 1 to 10) 1 Change Management: Understand where the organization is at the moment, Plan where the organization should be, Involve and agree support from the people within the system. 2 Networking & Relationship Management: Build a relationship among employees so that they feel close to each other, communicate with each other, feel sympathetic & responsive to each other and feel empathy with each other. 3 Coaching & Counselling: Helping subordinates to grow and develop in synergy with the organizational goals. 4 Vision & Strategic Thinking: Formulates the organisation s vision and shows commitment to it. Promotes the vision in an inspiring way, both internally and externally. Identifies strategic issues, opportunities and risks, and effectively integrates them into organisational objectives. Total Score out of 40 Marks = Total Score x 10 40 = Nothing Adverse Questionable Yes/No Yes/No (if yes give brief details in adjacent cell) Integrity Signature of Reporting Officer Page 7 of 10 Developed by MIS
Employee Number Annexure-II Part VII: Special Achievement To be filled at the end of the year Maximum Marks: 5 To be filled by executive in consultation with reporting officer Individual & Team Achievements & Contributions Area Of Achievement Description of Contribution Comments of reporting officer Ratings (to be evaluated on the scale of 1 to 10) Marks = Total Score x 5 10 = Signature of Executive Signature of Reporting Officer Page 8 of 10 Developed by MIS
Part VIII: Individual Training & Development Plan Annexure-II (To be separated & forwarded to Training Cell) Name Employee Number Department Designation Level Section (To be filled by Training Cell) Training Area Identified Last Year Training Given Last Year Reasons for not providing the training Current Training Needs Training Area Functional Or Technical Training Needs Managerial or Behavioural Any Other area Signature of Reporting Officer Page 9 of 10 Developed by MIS
Part IX: Total Marks Annexure-II Section A: To Be Filled by Reporting Officer at the end of the year Part Components Maximum Marks Marks Obtained Part III Key Performance Area 60 Part IV Managerial Competencies 15 Part V Core Values 10 Part VI Potential 10 Part VII Special Achievement 5 Name: Total Marks Signature of Reporting Officer: Designation: Section B: To be filled by Reviewing Officer after discussion with reporting officer Marks Awarded Part III Part IV Part V Part VI Part VII Total Rational For Change of marks (Mandatory) Signature of reporting officer: Name: Signature of Reviewing Officer: Designation: Section C: To be filled by Counter signing officer after discussion with reviewing officer Marks Awarded Part III Part IV Part V Part VI Part VII Total Rational For Change of marks (Mandatory) Signature of reviewing officer: Signature of Counter signing Officer: Name: Designation: Page 10 of 10 Developed by MIS