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Documenti di Professioni
Documenti di Cultura
RESEARCH REPORT
ON
“PERFORMANCE APPRAISAL” IN BANKING
SECTOR
Submitted for the fulfillment for the award of
MASTER OF BUSINESS ADMINISTRATION
(Sikkim Manipal University)
(SESSION: 2009-2010)
Submitted By:
Ekta Bhatia
MBA IV Semester
Roll No. 510919106
1
DECLARATION
College, Meerut
Administration (M.B.A.).
2
List of contents
Preface
Acknowledgement
Research Methodology
Introduction To Banking
Sector
HRM Approach
“Performance Appraisal”
– A Systematic Approach
3
“Performance Appraisal”
And Performance Management
In ICICI Bank
Conclusion
Suggestion And
Recommendation
Bibliography
4
Preface
5
Acknowledgement
I would like to thank Mr.Pankaj Upadhyay for his guidance & support
with his valuable inputs & knowledge.
Once again thanks to all for providing me your direct and indirect
support for my research work and help in writing the report
EKTA BHATIA
6
To understand the concept of HR in special reference of
“Performance Appraisal”
7
About the study
8
The study, ““Performance Appraisal” in Banking Sector”, highlights the
importance of “Performance Appraisal” in special reference of banking
industry. As we know the banking sector is one of the fastest growing
sectors of our country, the study highlights the perspective of HR in
banking sector.
Further we highlighted the role of HR, its need and importance and
“Performance Appraisal” as its one of the major tools. It signifies the
role of HR in organizational perspective and highlight the rationale of
active HR polices in an organization , this reports takes the HR as
9
managerial function rather than the staff activities . In this report we
try to make the role and concept of HRM understood for our readers.
In special cases like the practical example of ICICI bank ,the study
highlights:
a) techniques ,
b) approach,
c) forms,
d) managerial approach,
e) employees feedback,
f) process and other real aspect of the “Performance Appraisal”
that provides the realistic view of the “Performance Appraisal” process
that is carried out by the bank in actual work environment .
10
other issues related to the banking industry . This study refers to the
role of “Performance Appraisal” in a wide and in a systematic manner
that takes place in a sequential way and covers almost all the aspect
of the appraisal from employees to organization under the universal
approach called “Performance Management”
11
Following aspects are covered under this study:
12
Research Methodology
13
The study seems to be the observation and a description of the
project where we try to find out the hidden aspect or bring out the
concept for further explanation, but some scientific method and
techniques classified it as the research, that’s why the following
research methods, techniques and components are used to facilitate
the study
14
limitations are understood, they can still be a useful tool in many areas
of scientific and normal study research such as this project.
Secondary data was used for this study as the research design is
descriptive in nature so we tried to collect the data available through
other sources on the subject. Some times, primary data is also
collected through observation method to facilitate the research work
Sources of data
The following sources are used for collecting the data for this study:
Books
internet
Journals
News papers
Personal sources
15
Judgment sampling is a common no probability method. This
sampling is selected on the judgment. This is usually and extension of
convenience sampling. We have decided to draw the entire sample
from one "representative" bank even though the population includes
all banks. When using this method, we try to ensure that the chosen
sample is truly representative of the entire population.
16
Banking can be defined in various ways as the definition of the bank
varies from country to country and keeps on changing on the basis of
the activities carried out by the banks. In present dynamic business
scenario, banking can be defined as the activities carried out with the
bank on individual or corporate level. We can understand the concept
of the banking by looking into the activities of the bank.
• Transactional services,
• Services related to monetary transaction through current and
saving account,
• Investment services,
• Fixed deposit ,
• Letter of credit ,
• Treasury services ,
• Bill of exchange ,
• Foreign exchange ,
• Assisting in trade through Letter of credit,
• Letter of guarantee,
• Performance bond ,
• Project financing ,
• Personal loan ,
• Credit card ,
17
• Home loan etc.
18
Banking in India originated in the last decades of the 18th century.
The oldest bank in existence in India is the ‘State Bank of India’, a
government-owned bank that traces its origins back to June 1806 and
that is the largest commercial bank in the country. Central banking is
the responsibility of the Reserve Bank of India, which in 1935 formally
took over these responsibilities from the then Imperial Bank of India,
relegating it to commercial banking functions. After India's
independence in 1947, the Reserve Bank was nationalized and given
broader powers. In 1969 the government nationalized the 14 largest
commercial banks; the government nationalized the six next largest in
1980.
Currently, India has 88 scheduled commercial banks (SCBs) - 27
public sector banks (that is with the Government of India holding a
stake), 31 private banks (these do not have government stake; they
may be publicly listed and traded on stock exchanges) and 38 foreign
banks. They have a combined network of over 53,000 branches and
17,000 ATMs. According to a report by ICRA Limited, a rating agency,
the public sector banks hold over 75 percent of total assets of the
banking industry, with the private and foreign banks holding 18.2%
and 6.5% respectively.
19
stimulus packages.
The strong economic growth in the past, low defaulter ratio, absence
of complex financial products, regular intervention by central bank,
proactive adjustment of monetary policy and so called close banking
culture has favored the banking industry in India in recent global
financial turmoil.
20
The Economic Liberalization process has increasingly exposed the
Banking Sector to international competition. The role of Banking in the
process of financial intermediation has been undergoing a profound
transformation, owing to changes in the global financial system.
Consequently, the revolution in information technology has brought
about sea changes in the way banking transaction are carried out
The RBI has given licenses to new private sector banks as part of the
liberalization process. The RBI has also been granting licensees to
industrial houses. Many banks are successfully running in the retail
and consumer segments but are yet to deliver services to industrial
finance, retail trade, small business and agricultural finance.
The PSBs will play an important role in the industry due to its number
of branches and foreign banks facing the constraint of limited number
of branches. Hence, in order to achieve an efficient banking system,
the onus is on the Government to encourage the PSBs to be run on
professional lines.
To promote banking sector in India, Govt. has taken many steps and
formed several committee to review the banking needs and the
prospect the current scenario along with the safeguarding the interest
of the customers
21
Reserve bank of India
The central bank of the country is the Reserve Bank of India (RBI). It
was established in April 1935 with a share capital of Rs. 5 crores on
the basis of the recommendations of the Hilton Young Commission.
The share capital was divided into shares of Rs. 100 each fully paid
which was entirely owned by private shareholders in the beginning.
The Government held shares of nominal value of Rs. 2, 20,000.
Reserve Bank of India was nationalized in the year 1949. The general
superintendence and direction of the Bank is entrusted to Central
22
Board of Directors of 20 members, the Governor and four Deputy
Governors, one Government official from the Ministry of Finance, ten
nominated Directors by the Government to give representation to
important elements in the economic life of the country, and four
nominated Directors by the Central Government to represent the four
local Boards with the headquarters at Mumbai, Kolkata, Chennai and
New Delhi. Local Boards consist of five members each Central
Government appointed for a term of four years to represent territorial
and economic interests and the interests of co-operative and
indigenous banks.
23
Public sector banks
• Dena Bank
• IDBI Bank
• Indian Bank
• Indian Overseas Bank
• Oriental Bank of Commerce
• Punjab & Sind Bank
• Punjab National Bank
• Syndicate Bank
• UCO Bank
• Union Bank of India
• United Bank of India
• Vijaya Bank
24
Private sector banks
• Bank of Rajasthan
25
• Bharat Overseas Bank
• Catholic Syrian Bank
• Centurion Bank of Punjab (Merged with HDFC bank)
• City Union Bank
• Development Credit Bank
• Dhanalakshmi Bank
• Federal Bank
• HDFC Bank
• ICICI Bank
• IndusInd Bank
• ING Vysya Bank
• Jammu & Kashmir Bank
• Karnataka Bank
• Karur Vysya Bank
• Kotak Mahindra Bank
• Lakshmi Vilas Bank
• Lord Krishna Bank ( now Centurion Bank of Punjab)
• Nainital Bank
• Nedungadi Bank (now Punjab National Bank)
• Ratnakar Bank
• Rupee Bank
• Saraswat Bank
• SBI Commercial and International Bank
• South Indian Bank
• Tamil Nadu Mercantile Bank
• Thane Janata Sahakari Bank
• Bassein Catholic Bank
• United Western Bank ( now IDBI Bank)
• YES Bank
26
Foreign Banks
27
• Abu Dhabi Commercial Bank Ltd
• American Express Bank
• Antwerp Diamond Bank
• Arab Bangladesh Bank
• Bank International Indonesia
• Bank of America
• Bank of Bahrain & Kuwait
• Bank of Ceylon
• Bank of Nova Scotia
• Bank of Tokyo Mitsubishi UFJ
• Barclays Bank
• BNP Paribas
• Calyon Bank
• ChinaTrust Commercial Bank
• Citibank
• DBS Bank
• Deutsche Bank
• HSBC (Hongkong & Shanghai Banking Corporation)
• JPMorgan Chase Bank
• Krung Thai Bank
• Mashreq Bank
• Mizuho Corporate Bank
• Oman International Bank
• Shinhan Bank
• Société Générale
• Sonali Bank
• Standard Chartered Bank
• State Bank of Mauritius
28
Banks with Representative Offices in India:
American Banks
29
• Wachovia Bank
Australian Banks
• Commonwealth Bank
• National Bank Australia
• Westpac Banking Corporation
Austrian Banks
Belgian Banks
• Fortis Bank
• K.B.C. Bank N.V.
Canadian Banks
UAE Banks
French Banks
German Banks
30
• Dresdner Bank
• DZ Bank AG Deutsche Zentral – Genossenschafts Bank
• HSH Nordbank
• Landesbank Baden – Wurttemberg
Irish Banks
• DEPFA Bank
Italian Banks
Nepalese Banks
• Everest Bank
Portuguese Banks
Russian Banks
• Vnesheconombank
• VTB India
• Promsvyazbank
31
South African Banks
• Wori Bank
Spanish Banks
• Banco de Sabadell
• Banco Bilbao Vizcaya Argentaria
SriLankan Banks
Swiss Banks
• UBS
• Zurcher Kantonalbank
Rural Banks
32
• Aryavart Gramin Bank
• Balasore Gramya Bank
• Ballia Kshetriya Gramin Bank
• Banaskantha Mehsana Gramin Bank
• Bangiya Grameen Vikash Bank
• Bareilly Kshetriya Gramin Bank
• Baroda Uttar Pradesh Gramin Bank
• Bijapur Grameena Bank
• Bilaspur-Raipur Kshetriya Gramin Bank
• Bolangir Anchalik Gramya Bank
• Bundelkhand Kshetriya Gramin Bank
• Bundi Chittorgarh Kshetriya Gramin Bank
• Cauvery Grameena Bank
• Chaitanya Godavari Grameena Bank
• Chambal Kshetriya Gramin Bank
• Champaran Kshetriya Gramin Bank
• Chhatrasal Gramin Bank
• Chhindwara Seoni Kshetriya Gramin Bank
• Chitradurga Gramin Bank
• Cuttack Gramya Bank
• Damoh Panna Sagar Kshetriya Gramin Bank
• Devipatan Kshetriya Gramin Bank
• Dhenkanal Gramya Bank
• Dungarpur Banswara Kshetriya Gramin Bank
• Ellaquai Dehati Bank
• Farrukhabad Gramin Bank
• Gaur Gramin Bank
• Gurgaon Gramin Bank
• Hadoti Kshetriya Gramin Bank
33
• Himachal Gramin Bank
• Hissar-Sirsa Kshetriya Gramin Bank
• Indore Ujjain Kshetriya Gramin Bank
• Jaipur Nagaur Aanchalik Gramin Bank
• Jamnagar Rajkot Gramin Bank
• Jamuna Gramin Bank
• Jhabua-Dhar Kshetriya Gramin Bank
• Jharkhand Gramin Bank
• Kakathiya Grameena Bank
• Kalpatharu Grameena Bank
• Kamraz Rural Bank
• Kanpur Kshetriya Gramin Bank
• Kapurthala Ferozpur Kshetriya Gramin Bank
• Kashi Gomti Samyut Gramin Bank
• Kisan Gramin Bank,Budaun
• Kolar Gramin Bank
• Krishna Grameena Bank
• Kshetriya Gramin Bank,Hoshangabad
• Kutch Grameen Bank
• Malaprabha Grameena Bank
• Mandla Balaghat Kshetriya Gramin Bank
• Manjira Grameena Bank
• Marwar Ganganagar Bikaner Gramin Bank (Previously : Marwar
Gramin Bank)
• Mewar Aanchalik Gramin Bank
• Nagarjuna Grameena Bank
• Netravati Grameena Bank
• Nimar Kshetriya Gramin Bank
• North Malabar Gramin Bank
34
• Panchmahal Vadodara Gramin Bank
• Pandyan Grama Bank
• Pinakini Grameena Bank (merged to form Andhra Pragathi
Grameena Bank)
• Pragjyotish Gaonlia Bank
• Prathama Bank
• Raigarh Kshetriya Gramin Bank
• Rani Lakshmi Bai Kshetriya Gramin Bank
• Ratlam Mandsaur Kshetriya Gramin Bank
• Rayalaseema Grameena Bank (merged to form Andhra Pragathi
Grameena Bank)
• Rewa-Sidhi Gramin Bank
• Sahyadri Gramin Bank
• Samyut Kshetriya Gramin Bank
• Sangameshwara Grameena Bank
• Shahjahanpur Kshetriya Gramin Bank
• Shreyas Gramin Bank (Aligarh,Etah,Agra,Mathura,Firozabad)
• Shivpuri Guna Kshetriya Gramin Bank
• South Malabar Gramin Bank
• Sree Anantha Grameena Bank (merged to form Andhra Pragathi
Grameena Bank)
• Sri Saraswati Grameena Bank
• Sri Visakha Grameena Bank
• Surat Bharuch Gramin Bank
• Thar Aanchalik Gramin Bank
• Tripura Gramin Bank
• Tungabhadra Gramin Bank
• Vidur Gramin Bank
• MCB
35
• Madhya Bharat Gramin Bank
36
“Human resource management's objective is to maximize the return
on investment from the organization's human capital and minimize
financial risk. It is the responsibility of human resource managers in a
corporate context to conduct these activities in an effective, legal, fair,
and consistent manner”
37
of proven techniques which result in the actual increases of profit
margins.
38
In addition, human resources departments take care of a variety of
concerns such as labor relations – the crucial and highly sensitive
negotiations between employees and management – the production of
job descriptions, the monitoring of interplay between workers in order
to design a more efficient employee management system, the
compilation of benefits packages as well as a variety of other vital
functions that relate directly to the employee workforce
39
link between the organization and the employees. A company should
first become aware of the needs of its employees, and at a later stage,
understand and evaluate these needs in order to make its employees
perceive their job as a part of their personal life, and not as a routine
obligation. To that end, HRM is very crucial for the whole function of
an organization because it assists the organization to create loyal
employees, who are ready to offer their best.
40
• To attract new employees
• To contribute to employee development
On the other hand, challenges do not cease for the HRM. Modern
organizations can survive in the dynamic, competitive environment of
today only if they capitalize on the full potential of each employee.
Unfortunately, many companies have not understood the importance
of the human capital in successful operations. The recruitment and
selection of the best employees is a very difficult obligation. Even
companies that are voted in the top-ten places to work at, often
endure long periods of hard work to realize that human element is all
an organization should care about.
New challenges arise even now for the organization, and it is certain
that new challenges will never cease to emerge. Therefore, the use of
proper Human Resources techniques is a really powerful way for
organizations to overcome these challenges, and to improve not only
their quantitative goals but also their organizational culture, and their
qualitative, cognitive aspects.
41
Current trends in HR
42
role of HR manager is shifting from that of a protector and screener to
the role of a planner and change agent. Personnel directors are the
new corporate heroes. The name of the game today in business is
personnel. Nowadays it is not possible to show a good financial or
operating report unless your personnel relations are in order.
Over the years, highly skilled and knowledge based jobs are increasing
while low skilled jobs are decreasing. This calls for future skill mapping
through proper HRM initiatives.
Functions of H. R
43
4. Promotions
5. Redundancy
6. Industrial and Employee Relations
7. Record keeping of all personal data.
8. Compensation, pensions, bonuses etc in liaison with Payroll
9. Confidential advice to internal 'customers' in relation to problems
at work
44
“Performance Appraisal”, also known as employee appraisal, is a
method by which the job performance of an employee is evaluated
(generally in terms of quality, quantity, cost and time).
45
be correlated with the organizational mission, philosophies and
value system;
cover assessment of performance as well as potential for
development;
take care of organizational as well as individual needs; and
help in creating a clean environment by
- Linking rewards with achievements,
- generating information for the growth of the employee as well as of
the organization,
- suggesting appropriate person-task matching and career plans.
46
(a) “Performance Appraisal” System: The Process
47
development strategies in a structured manner for each employee. In
doing so, they should keep the goals of the organization in mind and
aim at optimal utilization of all available resources, including financial.
“Performance Appraisal” is a multistage process in which
communication plays an important role.
48
The second step in the appraisal process is communicating to
employees the measures and standards which will be used in the
appraisal process. Such communication should clarify expectations and
create a feeling of involvement.
(iii) Planning
(v) Appraising
(vi) Feedback
49
After the formal appraisal stage, a feedback session is desirable. This
session should involve verbal communication, listening, problem
solving, negotiating, compromising, conflict resolution and reaching
consensus.
50
Documentation – means continuous noting and documenting the
performance. It also helps the evaluators to give a proof and the basis
of their ratings.
51
Correlated with the organization's philosophies and mission
Cover assessment of performance as well as potential for
development
Look after the needs of both the individual and the organization
Help create a clean environment
Rewards linked to achievements
Generate information for personnel development and career
planning
suggesting appropriate person-task matching
52
Give a better understanding of personal strengths and
weaknesses in relation to expected roles and functions
Identify development needs of an employee
Establish common ground between the employee and the
supervisor
Increase communication
Provide an employee with the opportunity for self-reflection and
individual goal setting
Help an employee internalize the culture, norms and values of
the organization. This helps develop an identity with and
commitment to the organization and prepares an employee for
higher-level positions in the hierarchy
Assist in a variety of personnel decisions
Intuitive
Self-appraisal
Group
53
Trait
Achievement of results
54
Field review method
Forced choice rating method
Critical incident appraisal method
Management by objectives
Work standard approach
Ranking methods
methods
Alteration ranking
- Paired comparison
- Person-to-person rating
- Checklist
- Behaviorally anchored rating scales
- Assessment centers
55
PROBLEMS
Measurement Judgement Policy Organization
Deciding what to Appraising Using the results Recognizing how
evaluate performance of the appraisal managers work
and the
organization
culture
SYMPTOMS
Ambiguity in Disagreement Top Appraisal forms
roles and on ratings management fails not completed
responsibilities of to reward
Official review Managers com
each job managers who
changes ratings plain about time
are excellent in
Job needed
staff assessment
Appeals,
performance is
and development
grievances, System seen
difficult to
accusations of as belonging to
quantify Marginal
bias, the designers, not
performers
No clear discrimination the users
receive
statement of
promotions or
Personnel/HR
overall objectives
salary increases
specialists take
of units or the
enforcer not
organization
adviser role
Appraisal
system revised
contains only
frequently
numerical indices
POTENTIAL CURES
Job analysis Observable, Top Implement
and credible job behaviorally management “Performance
description actually uses Appraisal” using
56
based criteria “Performance the Performance
Outcomes of
Appraisal” itself Management (PM)
each job Performance
identified documented over Polices for
time “Performance
Overall goals
Appraisal”
set for units and rater training
consistently
the organization and practice
applied
Train Effective
performance-
managers to communication
contingent
make of performance
reward system
documented expectations
operates
judgements
Overview
ICICI Bank is India's second-largest bank with total assets of Rs.
3,744.10 billion (US$ 77 billion) at December 31, 2008 and profit after
tax Rs. 30.14 billion for the nine months ended December 31, 2008.
57
The Bank has a network of 1,438 branches and about 4,644 ATMs in
India and presence in 18 countries. ICICI Bank offers a wide range of
banking products and financial services to corporate and retail
customers through a variety of delivery channels and through its
specialized subsidiaries and affiliates in the areas of investment
banking, life and non-life insurance, venture capital and asset
management. The Bank currently has subsidiaries in the United
Kingdom, Russia and Canada, branches in United States, Singapore,
Bahrain, Hong Kong, Sri Lanka, Qatar and Dubai International Finance
Centre and representative offices in United Arab Emirates, China,
South Africa, Bangladesh, Thailand, Malaysia and Indonesia. Our UK
subsidiary has established branches in Belgium and Germany.
ICICI Bank's equity shares are listed in India on Bombay Stock
Exchange and the National Stock Exchange of India Limited and its
American Depositary Receipts (ADRs) are listed on the New York Stock
Exchange (NYSE).
History
ICICI Bank was originally promoted in 1994 by ICICI Limited, an
Indian financial institution, and was its wholly-owned subsidiary.
ICICI's shareholding in ICICI Bank was reduced to 46% through a
public offering of shares in India in fiscal 1998, an equity offering in
the form of ADRs listed on the NYSE in fiscal 2000, ICICI Bank's
58
acquisition of Bank of Madura Limited in an all-stock amalgamation in
fiscal 2001, and secondary market sales by ICICI to institutional
investors in fiscal 2001 and fiscal 2002. ICICI was formed in 1955 at
the initiative of the World Bank, the Government of India and
representatives of Indian industry. The principal objective was to
create a development financial institution for providing medium-term
and long-term project financing to Indian businesses. In the 1990s,
ICICI transformed its business from a development financial institution
offering only project finance to a diversified financial services group
offering a wide variety of products and services, both directly and
through a number of subsidiaries and affiliates like ICICI Bank. In
1999, ICICI become the first Indian company and the first bank or
financial institution from non-Japan Asia to be listed on the NYSE.
59
five decades, entry into new business segments, higher market share
in various business segments, particularly fee-based services, and
access to the vast talent pool of ICICI and its subsidiaries. In October
2001, the Boards of Directors of ICICI and ICICI Bank approved the
merger of ICICI and two of its wholly-owned retail finance subsidiaries,
ICICI Personal Financial Services Limited and ICICI Capital Services
Limited, with ICICI Bank. The merger was approved by shareholders of
ICICI and ICICI Bank in January 2002, by the High Court of Gujarat at
Ahmedabad in March 2002, and by the High Court of Judicature at
Mumbai and the Reserve Bank of India in April 2002. Consequent to
the merger, the ICICI group's financing and banking operations, both
wholesale and retail, have been integrated in a single entity.
Board Members
60
Mr. M.K. Sharma
Mr. P.M. Sinha
Prof. Marti G. Subrahmanyam
Mr. T.S. Vijayan
Mr. V. Prem Watsa
Ms. Chanda Kochhar, Managing Director & CEO
Mr. Sandeep Bakhshi, Executive Director
Mr. Sonjoy Chatterjee, Executive Director
Mr. K. Ramkumar, Executive Director
Mr. N. S. Kannan, Executive Director & CFO
Board Committees
Customer Service
Credit Committee
Committee
61
Fraud Monitoring
Risk Committee
Committee
62
Extra Mile for ICICI bank
ICICI Bank bags the “Best bank in SME financing (Private Sector)” at
the Dun & Bradstreet Banking awards 2009.
ICICI Bank's Rural Micro Banking and Agri-Business Group win WOW
Event & Experiential Marketing Award in two categories - “Rural
Marketing programme of the year” and “Small Budget On Ground
Promotion of the Year”. These awards were given for Cattle Loan
'Kamdhenu Campaign' and 'Talkies on the move campaign'
respectively.
63
Warrentest”. ICICI Bank is ranked 2nd amongst 57 savings products
across 19 banks
ICICI Bank Germany won the yearly banking test of the investor
magazine €uro in the “call money”category.
ICICI Bank has been awarded the following titles under The Asset
Triple A Country Awards for 2009:
• Best Transaction Bank in India
• Best Trade Finance Bank in India
• Best Cash Management Bank in India
• Best Domestic Custodian in India
ICICI Bank has bagged the Best Cash Management Bank in India
award for the second year in a row. The other awards have been
bagged for the third year in a row.
64
Needs and Importance For “Performance
Appraisal” in Banking
65
and help retain this talent is increasingly important. Testament to the
fact many banks in the region are now recognising the value of
developing their human resources, Abu Dhabi recently hosted the
Middle East Human Resource Summit - the annual conference and
exhibition for industry professionals. But can everyone be persuaded
to take real action in developing their HR departments
66
“Performance Appraisal” In Banking
Sector
67
(1) Plan for long-term staffing and worker development,
68
Although employees vary in their desire for improvement, generally
workers want to know how well they are performing. A successful
farmer recalled with sadness how as a youth he had worked very hard,
along with his immigrant family, for a farmer who never seemed to
notice the effort. Years later he met the former employer and asked
why he had never made any positive comments about their work. The
response from the former boss was, "I feared you would stop working
as hard."
69
that have taken. Some researchers feel feedback is particularly useful
when workers have an achievement objective
70
• To review the performance of the employees over a given
period of time.
71
Followings should kept in the mind for effective “Performance
Appraisal” in a bank
72
The “Performance Appraisal” is often the central pillar of performance
management in the bank to keep the motivation of the employees
high.
73
“Performance Appraisal” And
Performance Management In ICICI Bank
74
75
Reasons for “Performance Appraisal” in ICICI
76
Modern Trends In Banks for P.A
A growing number of front running banks like ICICI, and others have
adopted a “Performance Appraisal” model in which best-to-worst
ranking methods are used to identify poor performers. The identified
poor performers are then given a time period during which they have
to show an improvement in their performance.
Effective banks are not build merely on investment and returns but
more on the quality of the workforce, its commitment to the
organizational goals and investments made to attract train and retain
superior human capital. An integrated Performance Management
system is essential to get the best out of its people. Employee
performance is linked to the bank’s performance. This helps in
achieving the organizational goal and creates a performance culture in
77
the bank. Invention, creativity, diversity of perspectives is fostered.
Employees act as one bank one brand.
78
ICICI BANK PEFORMENCE APPRAISAL ENVIRONMENT
It is easy to implement because those who carry out the plan also
participates in setting it up. Each employee becomes aware of the task
he has to perform in the bank. This leads to better utilization of
capacity and talent. It promotes better communication and information
sharing. It provides guidelines for self evaluation as well as evaluation
by the superior against set tasks and goals. It facilitates guidance and
counseling.
79
The Effective Components of ICICI P .A System
80
Finally, talking about mutual goals, the emphasis is on growth and
development, harmony, effectiveness and profitability of the bank
81
ICICI HR Philosophy on P.A
82
the bank employees and manager participate in a formal “Performance
Appraisal” interview. The appraisal form, used in the first step,
consists of performance standards and criteria that are used to judge
evaluate your performance. The items comprising your job description
are usually the performance standards that are used in employees
annual appraisal .The performance standards are derived from a job
analysis, which is a detailed list of all of the skills involved in
performing a task. For example, what are the skills necessary to
perform a complete blood count? The criteria are used to determine
the level of performance, which can be excellent, average, or poor (or
alternatively meets, exceeds or does not meet standards). Once
appraisal is complete, score is averaged and merit raise (if applicable)
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Forms Used By The Bank For P.A
1. General “Performance Appraisal” Form I
Two-page form for peers, outside suppliers and customers to fill out.
Also can be used for "upwards" feedback about managers.
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6. Manager “Performance Appraisal” Form
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Approaches And Techniques In “Performance Appraisal” Used
By The Bank
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Behavioral Method: This method focuses on observed behavior
and observable critical incidents.
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Appraisal techniques
There are several techniques of “Performance Appraisal”, each with
some strong points as well as limitations. Oberg (1972) has
summarized some of the commonly used “Performance Appraisal”
techniques.
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Since individual assessors differ in their standards, they inadvertently
introduce bias in their ratings. To overcome this assessor-related bias,
essay and graphic rating techniques can be combined in a systematic
review process. In the field review method, 'a member of the HRM
staff meets a small group of assessors from the supervisory units to
discuss each rating, systematically identifying areas of inter-assessor
disagreement.' It can then be a mechanism to help each assessor to
perceive the standards uniformly and thus match the other assessors.
Although field review assessment is considered valid and reliable, it is
very time consuming.
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behavior rather than on traits. While this technique is well suited for
performance review interviews, it has the drawback that the
supervisor has to note down the critical incidents as and when they
occur. That may be impractical, and may delay feedback to
employees. It makes little sense to wait six months or a year to
discuss a misdeed, a mistake or good display of initiative.
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(viii) Ranking Methods:
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(c) Person-to-Person Rating: In the person-to-person rating
scales, the names of the actual individuals known to all the assessors
are used as a series of standards. These standards may be defined as
lowest, low, middle, high and highest performers. Individual
employees in the group are then compared with the individuals used
as the standards, and rated for a standard where they match the best.
The advantage of this rating scale is that the standards are concrete
and are in terms of real individuals. The disadvantage is that the
standards set by different assessors may not be consistent. Each
assessor constructs their own person-to-person scale which makes
comparison of different ratings difficult.
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(f) Assessment centers: This technique is used to predict future
performance of employees were they to be promoted. The individual
whose potential is to be assessed has to work on individual as well as
group assignments similar to those they would be required to handle
were they promoted. The judgment of observers is pooled and paired
comparison or alteration ranking is sometimes used to arrive at a final
assessment. The final assessment helps in making an order-of-merit
ranking for each employee. It also involves subjective judgment by
observers.
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Banner Corporation Banks on Halogen for
Talent and Learning and performance
Management (For Practical
Understanding)
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The new Web-based system will enable Banner Corporation to
automate the employee appraisal process driving consistency across
the organization. Learning functions, such as compliance training, will
be tied into the appraisal process, and information from appraisals will
be used for succession planning purposes, thereby creating a complete
talent management strategy across all its locations in the Northwest.
Banner Corporation is starting with a deployment of Halogen
eAppraisal Financial Services and Multi-Rater for employee
performance management and plans to build on the implementation
with fully integrated Halogen eSuccession and eLMS modules.
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Halogen's offering makes HR best-practices accessible to companies of
all sizes and its healthcare, financial services and professional services
specific suites meet the unique needs of these industries. Halogen is
consistently recognized by the industry and its customers for its
exceptional implementation and support services, and has won
multiple awards for its corporate leadership and product innovation,
including HR Technology Product of the Year. For more information,
visit www.halogensoftware.com .
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Conclusion
This situation has put more focus on effectiveness, that systems and
processes in the organization be applied in the right way to the right
things: to achieve results. All of the results across the organization
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must continue to be aligned to achieve the overall results desired by
the organization for it to survive and thrive. Only then it be said that
the organization and its various parts are really performing.
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can recognize its true personnel inventory and formulate the
strategy for man power planning and career development.
“Performance Appraisal” directly affects the other sub system of
HRM such as manpower planning, selection, career development,
potential development, recruitment, compensation etc.
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Suggestion and recommendation
Though it is the basic rule of the report writing that suggestion and
recommendation should not be given until it’s asked for but to keeping
in the mind the academic nature of the report we would like to
recommend the followings
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Bibliography
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