CHAPTER I

INTRODUCTION
To the study “Role of performance appraisal
in employee motivation”

1
 INTRODUCTION

There are number of forces that make HR the greatest support system in the
Organization. Employees play a great role in the success of any organization. It is necessary
to find out whether the employees are satisfied with the performance appraisal of the
organization

This Project Report has been completed in partial fulfillment of management

program, Master of Business Administration (MBA) in the company ―Zen Aspirations Pvt
Ltd”. The topic of my project was “Role of performance appraisal system in employee
motivation”.

Zen Aspirations are a technology services and solutions company (ISO 9001:2008 certified)
providing high quality end-to-end IT Solutions and Services to clients globally. The company
specialize in creating bespoke software solutions, web applications, mobile applications and
more to bring clients‘ ideas to reality and have experience in delivering high quality total
solutions for different domains including Healthcare, Banking & Financial Services, Retail &
Shopping, Logistics & Transportation, Media & Entertainment, Automobile and Fashion and
more.

With the broadest range of capabilities, from consulting and systems integration to
outsourcing, Zen Aspirations offer you the best total solutions you need to grow and be
successful in your industry.

The performance appraisal system emphasizes on the value adding services

rather on daily routine activities. Giving slow performers necessary training and high
performer‘s growth opportunity has been a continuous procedure all these years. It is also
very much essential to find out whether the employees are satisfied with the current
performance appraisal that are done within the organization
Performance Appraisal is the process of assessing the performance
and progress of an employee or of a group of employees on a given job and his potential for
the future development. According to ―EDWIN B FLIPO‖ Performance appraisal is the
systematic, periodic and impartial rating of an employee‘s excellence in the matters

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pertaining to his present job and his potential for a better job‖. Performance appraisal focus
on the performance and future potential of the employee. Its aim is not simply to decide
salary increment but to develop a rational basis for personal decisions. Merit rating measures,
what the person is (traits) whereas performance appraisal measures what the person does
(performance).

Employee motivation is the "psychological forces that determine the direction of a person's
behavior in an organization, a person's level of effort and a person's level of persistence".

Motivational techniques

Job design

The design of an employee‘s job can have a significant impact on their job motivation. Job
design includes designing jobs that create both a challenging and interesting task for the
employee and is effective and efficient for getting the job done. Four approaches to job
design are:

1. Job Simplification: The goal of this job design approach is to standardize and
specialize tasks. Unfortunately this approach does not always lead to increased
motivation as the jobs can become mundane.
2. Job Enlargement: The goal of this job design approach is to combine tasks to
give the employee a greater variety of work.
3. Job Rotation: The goal of this job design approach is to move workers to
different tasks periodically.
4. Job Enrichment: The key to job design employee motivation, this approach
aims to enhance the actual job by building up the employee through
motivational factors.

Rewards

Using rewards as motivators divides employee motivation into two categories: intrinsic and
extrinsic motivation. Intrinsic rewards are internal, psychological rewards such as a sense of
accomplishment or doing something because it makes one feel good. Extrinsic rewards are
rewards that other people give to you such as a money, compliments, bonuses, or trophies.

Employee participation

1. Increase employee participation by implementing quality control circles. Quality control

circles involve a group of five to ten problem solving employees that come together to solve

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work-related problems such as reducing costs, solving quality problems, and improving
production methods. Other benefits from quality control circles include an improved
employee-management relationship, increased individual commitment, and more
opportunities for employee expression and self-development.

Quality-of-work-life programs
Work-life balance is an employee‘s perception of how a proper balance between
personal time, family care, and work are maintained with minimal conflict. Employers can
use work-life balance as a motivational technique by implementing quality-of-work-life
programs. Examples of such programs include flextime, work place and family support.
Flexible work schedules can allow an employee to work whenever they can as long as a
certain amount of hours are worked each week and some employers allow their employees to
work from home.
In the growing age of business and markets, human resource is the big asset of
the organization; if the organization is not keeping well with its labour work force then it
might get into trouble. As the employees are the main features of the progress of the
organization. In order to have productivity, employee should be motivated and should be
satisfied with their job and have loyalty with the organization (EPstein,1992). HR
professionals are making it possible to motivate the employees with the performance
appraisal systems by giving them fair appraisals as per their performance over a period of
time. It has been noticed that there is a strong relationship between performance appraisal and
motivation, job satisfaction and loyalty (bonnie, 2002). Keeping aside the main objectives of
performance appraisal, it can be used as a mechanism to create a completion between
employees to get the job done with all the linked targets and benchmarks

1.1 Statement of the problem

Effectiveness of the performance appraisal of the employees of Zen Aspirations Pvt Ltd and
how much it influences in employee motivation.
1.2 Significance of the study
Once an employee is selected in an organization he is trained and motivated to
perform job. Then performance of the employee is assessed and evaluated through the system
called ―performance appraisal‖. Performance appraisal is the most significant and
indispensable tool in the organization, the significance of the study is whether the employees
are motivated by the current performance appraisal prevailed in the organization. In this view

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the study was undertaken on the proposed topic ―Role of Performance appraisal system in
employee motivation on Zen Aspirations Pvt ltd‖

1.3 Objectives of the study

 To find out the main variables of performance appraisal and employee

motivation
 To find out whether there is any interlink between performance appraisal and
employee motivation
 To find out the role of performance appraisal in employee motivation using
the variables

1.4 Scope of Study

Performance appraisal is known to have a dual capacity of motivating and de-motivating

employees based on how they are designed and implemented. The findings of the study
would be useful to the organizations where appraisals form part of organizational life. This
was because the findings could help them how much performance appraisal helps in
employee motivation.

1.5 Limitations of the Study

 Due to hectic schedule of the employees it was not possible to collect more
information
 Sample size is small compared with the population
 The time constraint in the collection of data
 The employees withheld the information due to their changing perceptions and
attitudes
 The whole study was based on the information given by the respondents

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1.6 Chapterisation

 The first chapter gives a general introduction about the study, statement of the
problem, scope of the study, objectives of the study and limitations of the study.
 The second chapter gives a clear picture about company profile of Zen Aspirations
PVT Ltd, industry profile, organization structure, products profile
 The third chapter deals with the theoretical frame work of the study and review of
literature
 The Fourth chapter deals with the Research methodology
 The fifth chapter deals with data analysis and interpretation which includes tables,
graphs etc.
 The sixth chapter carries summary of findings, suggestion and conclusion.

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 CHAPTER- II
Company & Industry Profile

PROFILE OF
“Zen Aspirations Pvt ltd”

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2.1 Company Profile
2.1.1 Introduction

Zen Aspirations

Zen are a technology services and solutions company (ISO 9001:2008 certified) providing
high quality end-to-end IT Solutions and Services to clients globally. The company specialize
in creating bespoke software solutions, web applications, mobile applications and more to
bring our clients‘ ideas to reality and have experience in delivering high quality total
solutions for different domains including Healthcare, Banking & Financial Services, Retail &
Shopping, Logistics & Transportation, Media & Entertainment, Automobile and Fashion and
more.

With the broadest range of capabilities, from consulting and systems integration to
outsourcing, Zen Aspirations offer you the best total solutions you need to grow and be
successful in your industry.

The company combines proven software development methodologies, experience with latest
technologies and a deep understanding of industry verticals to provide high quality services
that range from business analysis, commercial-grade product architecture, design, custom
application development, QA and testing services. Staining success of the solutions they
deliver is ensured by providing carefully crafted after-sales and maintenance support.

Company provides global delivery model combines on-site and offshore team members in a
collaborative environment to provide the client with unparalleled expertise and solutions.

Zen was led by senior and seasoned professionals from business and technology who have
held key executive leadership positions in major technology product companies. Zen focuses
on only one mission that is accelerating success to clients and employees. With significant
market presence, Zen has been consistently providing a host of value additions to the
businesses. In partnership with some of the leading companies across the globe, the company
provides one stop services and solutions on multiple verticals for Government, Corporate
bodies and other public sector undertakings

The company‘s ideal strategies and personal approach make us unique in delivering
customized business solutions focusing on customer satisfaction and quality. The company
has talented and experienced team of dedicated professional‘s helps businesses translate ideas

8
and vision to technology solutions. Zen help us to manage and profit from every major wave
of change in information technology (IT).

2.1.2 Infrastructure

Zen Aspirations maintain a state-of-the-art network infrastructure at its development center.

High-speed data communication links provide connectivity to clients worldwide. While being
fully secure & well equipped, this round-the-clock Technology Center ensures each and
every software engineer/consultant, up and running workstation connected to servers and
printers. Zen Aspirations maintain robust network infrastructure utilizing equipment from
industry leading vendors.

Network Equipment

Zen Aspirations have designed our overall network solution for flexible expansion to support
new types of connectivity, new applications, and new standards. The company use industry-
standard cables, switches, firewalls, routers and servers in well-designed configurations. Zen
Aspirations development center has a 40 active node internal LAN. The structured cabling
system is highly flexible and divisible into discrete modular subsystems.

Firewalls

Zen Aspirations have a customized Linux firewall, which acts as a VPN gateway, supporting
either site-to-site and remote access VPN applications with DES (Data Encryption
Standard).The gateway include network-based intrusion detection system. A redundant
standby unit, provided for high availability, maintains concurrent connections through
automatic state full synchronization.

Contingency and Disaster Recovery

The physical infrastructure at all our development facilities has been planned in such a
manner that practically nothing has been left to chance. All foreseeable contingencies have
been taken into consideration and consequently have been planned for. Power supply at the
development center has inbuilt redundancies so that work is not at all affected due to
disruption of power.

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Communications Infrastructure

24 x 7 Voice over IP calling facility is available for cost effective calling to our clients
globally for long discussions on projects. From the front desk to the managing director most
of our office team members are available on instant messengers making our team more
accessible to our clients.

Accessibility and Security

Depending upon the criticality of the area and the services within, different types of physical
and access restrictions have been imposed within the development centers so that our clients
can be absolutely certain that their data, systems and processes and other confidential
information, including IPRs (Intellectual Property Rights) do not get circulated, inadvertently
or on purpose.

Zen Aspirations have deployed electronic card based access control systems.

2.1.3 The Technology Advantage

We are specialists

Zen Aspirations maintain a team of carefully recruited highly skilled and experienced
professionals who are really passionate about IT. These specialists are further molded with
our proven in-house training program to cater to various business needs. With a team of
specialist around, ideas will be better understood and translated into realities. This process
ensures the quality of service from Zen Aspirations.

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“Zen Aspirations” The Technology Advantage

2.1.4 Software Engineering and Product development

Zen Aspirations possess a comprehensive set of skills includes mobile technologies, middle
tier software integration, customization, service oriented distributed software design and
deployment capabilities, internationally accredited user interface design which are all needed
for product realization. This, coupled with

Their hardware engineering capabilities enables them to work as a ―one-stop shop‖ for their
customers and address all of their software product development needs. Zen Aspirations help
their customers‘ offshore product development initiatives by taking a business-backward
approach to build differentiators within their products and stay ahead of the competition.

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Software Engineering Services

For the past years, Zen Aspirations have been envisioning, designing and delivering custom
software for our clients‘ toughest challenges. When innovation is critical, and failure is not an
option, The Company reflects our capabilities to excel and focus on customer success.

The Company mix cutting edge thinking, practices and technologies with tried and tested
approaches to give our clients an edge: exciting new customer experiences, powered by the
latest technologies, created in the simplest way possible.

2.1.5 Key Focus Areas

● Customized Applications for Managing in house CRM, ERP, Healthcare,

Business Management, Invoicing, Ticketing, Stock etc.
● Web Enabled Applications which includes Web Presence, Content management,
ecommerce etc.

Enterprise Mobility Services

Overview

Billions of Smartphone users, Billions of Apps downloads. Almost 90 billion Smartphone

and tablet apps will be downloaded this year as per survey by a leading media group. As
mobile adoption grows, businesses are imperative to move towards mobile enabled business.
These are good indicators for increasing market reach and innovative use of mobile
technology from a customer-facing perspective.

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2.1.6 Why Zen Aspirations

Zen Aspirations mobility team was the key enablers for the client enterprises to have mobility
enabled for their business. From initial service deployment, improvising, managing version to
re-provisioning and improvement, Zen Aspirations provides a lifecycle approach to the fast-
changing mobility services landscape.

Zen Aspirations relies on our focused Mobile Factory Core Process to help you manage your
entire mobility portfolio. Our approach focuses on profound UI/UX experience to application
quality and productivity while guarding against potential duplication or gaps.

Enabling Your Business Mobility Ready

Zen Aspirations core Mobility factory can be seamlessly integrated with your internal
systems including Sales force, Microsoft Dynamics, SAP, Siebel or any other CRM systems
and project management tools. This enables up-to-date information readily available for all
enterprise users who are on the move. The data can be visually represented through graphs

13
and charts to your Smartphone through WebAPI‘s wrapper which integrates with in-house
business management and reporting tool.

Mobility factory can also be seamlessly integrated with SQL Server 2012 Analysis Service
Cubes or Dashboard reports from SharePoint 2013 to capture dashboard information thus
enabling your Enterprise back office mobility ready

Mobile Websites

Zen Aspirations highly creative and experienced mobile website designers and developers
help create feature rich mobile websites utilizing the HTML 5 technology and responsive
tools like twitter bootstrap. Using industry accepted technology solutions built on a cost
effectiveness platform provides multiple benefits to your business ideas leaving space to
incorporate future enhancements. This helps businesses build web and mobile presence in a
relatively short span of time.

Hybrid, Cross Platform Mobile Applications

Zen Aspirations skilled hybrid cross platform development team focuses on creating effective
web applications, hosted inside a native-to-the-device application container model. This
enables a native application user experience. It‘s installed, launched and used like any native
app, and can access device APIs (with some exceptions/hurdles) while being built on HTML
5, JavaScript and CSS.

Android based Mobile Applications

Zen Aspirations team of creative, passionate and specialist android app developers believe in
delivering unmatched performance services to you.

They specialize in Original Equipment Manufacturers (OEM‘s) Application development as

well as custom application development for enterprise businesses. Our expert UI designing
team and highly skilled Android development team, has several years of core application
development experience for clients globally, creating exciting and innovative solutions for
enhanced user experience. The teams are well-versed with mobile application development
tools including

● Android Software Development kit (SDK)

● Android Media API‘s
● Location- based Service API‘s

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 ● Wi-Fi API‘s
● Android Security Architecture

iPhone, iOS, iPad Targeted Applications

Zen Aspirations is an expert factory for iOS and MAC development with profound focus on
iOS, iPhone, and iPad application development for several years now. The iOS Mobile and
Mac Factory team are experts in ObjectiveC and have won internal excellence award for
consistently meeting Apple Guidelines.

Zen Aspirations engage with small, medium and large enterprises requiring mobility
solutions. The list of clients includes innovative startups looking to establish their presence in
the mobile market to large corporates looking for cost effective solutions.

Process Consulting

Zen Aspirations consulting services help align organizational goals, people, tools and
technology with best-practices in software processes to deliver measurable outcomes and
benefits. Zen Aspirations Professional Services provides packaged services with predefined
deliverables for a fixed price and delivers within a fixed time-period – all of which is defined
upfront in the proposal.

Scoping is done by initial discussion with the IT managers, process and project team leads to
understand the existing process landscape of the organization. Starting with the understanding
of your broader goals and constraints, our teams of consultants require one or two sessions to
understand your process maturity and related issues in your organization with the goal of
capturing detailed process requirements in light of business needs.

2.1.7 Remote Infrastructure Support and Consulting

Increasing globalization, rapidly evolving technology, New virtualized ways of working and
a millennial generation of workers and customers–together, these megatrends are changing
the IT landscape and comprising the future of work. For companies to become ―next
generation businesses‖, IT leaders must be seen as integral players who deliver on four
values: efficiency, effectiveness, virtualization and innovation.

15
Solutions We Offer

Consulting and Professional Services

Zen Aspirations consulting practice helps you evaluate and plan infrastructure technology.
You gain tested methodologies and frameworks for assessing, designing and building a
modern, more dynamic infrastructure that aligns with industry best practices. Benefit from
our unique combination of onsite expertise and project management, offshore cost advantage,
and high-quality virtual delivery.

Managed Services

The company has flexibility, operations maturity and modular solutions can reduce
administrative overhead, free your talent to focus on strategic opportunities, and deliver
consistent and measurable infrastructure improvements.

Integrated Solutions

The Integrated Solutions group solves business challenges with end-to-end managed
solutions that encompass entire IT infrastructure from, hardware and software, to operating
systems and applications, to processes and people. By gaining full visibility into every aspect
of your applications, network architecture and security, you can address problem and incident
management.

Offshoring

The company focuses on highly qualitative, timely delivered and cost-effective offshore
software development. We capitalize on our rich experience in providing offshore software
development and project management capabilities. The quality standards, delivery process
and Global outsourcing strategy ensure we develop solutions that are cost effective, timely
and competitive.

Resourcing Models

Dedicated Development Centre

A Dedicated development center is a software engineering center model designed for clients
looking for cost effective offshore resource solutions and while having a need to have full
control over the software development team. Under this model, Zen Aspirations will reserve
infrastructure and resources exclusively for the client‘s team for a predetermined time frame.

16
The client will have complete access, control and transparency over the team and can utilize
the team to suffice to their needs.

If you want to setup a product development team in India as part of your business expansion
or need an extra hand on rare, costly or popular technologies for your in-house development
projects, Zen Aspirations can help you to cut your operation cost with our ‗dedicated
development center‘ service. You can pick and choose highly skilled developers from our
talented pool of professionals and build your own team with desired experience and expertise.
This team will work exclusively for you to meet your requirements.

Key Advantages of off shore temporary and dedicated staffing

● Add technical edge to the business concepts, allowing you to focus on key
business
● Significant cost savings over in-house development
● No need to invest in office infrastructure
● Strong and experienced management team to manage the software professionals
● Minimization of risk, no need for full-time staff or contractors
● Avoid bonuses, holiday pays, visa expenses and other pays you normally have to
promise
● Complete Intellectual property protection
● Secure development environment with firewall
● Complete freedom to involve and control the team
● Skilled developers that ensure professional service
● Flexible monthly contracts to yearly contracts are also available

Fixed Cost Projects

Zen Aspirations offers fixed cost project model where the requirements are estimated during
the beginning of the project and a fixed charge is derived based on hourly rates. Once the
project is approved by the client, activities are tracked from the initial stages of the project.
Any changes to the requirements will be tracked through a formal change management
process.

Dedicated Resourcing

Zen Aspirations offers dedicated resourcing model to help clients to interview and recruit
from the existing talent pool. These resources work as an extended team to the onsite

17
customer team for handling specific tasks assigned by this onsite team. In this model, task
allocation and management is of the resource is completely the clients responsibility and on
demand Zen Aspirations can provide project management service.

2.1.8 Software Support and Annual Maintenance Contract

Service Summary

Almost every website needs maintenance to keep up with the pace of the industry. Annual
website maintenance contracts are a cost-effective way to keep your website up-to-date, fresh
and effective.

The company has all types of AMC packages starting from Basic package for Small
businesses & organizations, which need less monthly time but needs consistent care &
Platinum package for large organizations requiring more time as a total of 100 hrs. per
month.

Scope of work

Website maintenance contracts only cover minor alterations, updates and repairs.
Maintenance requests requiring extensive alterations or updates are beyond the scope of the
website maintenance contract and will be quoted separately.

Contract Incentives

Monthly Health Check: Includes internal and external links, on-line forms, search facilities,
site maps and any dynamic functionality.

Quarterly Statement: Details hours used, hours available and a breakdown of the work
completed.

Turn-around Time in Website Maintenance

Website maintenance requests are submitted and responded via an online ticketing system.
Depending on the complexity of the request, the job will be completed in minimum time.
Customer will get alerts and can view the up to date progress via the ticketing system and
also specify priority

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Services covered in AMC Package

Basic Package

● Additions or deletions of Text / Links

● Addition, deletion of images / Videos
● Text changes in already designed Flash
● Changes in Forms (Add/Remove form fields)
● Addition, Deletion in the site Navigation
● Additions or deletions on Web pages (using existing page designs)
● Basic SEO on new pages
Platinum Package

● Server uptime Monitoring, Log Management

● Backup of website related data
● OS & Application Patch Management
● AV & threat Management
Services NOT covered in AMC Packages

● Major graphic updates or New Designs

● Creating new Advertising material
● Major functionality & design change
● Altering the usability of website
● Complete site Search Engine Optimization
● Hardware maintenance
● Change in Business Plan
● Implementing New Technologies
● Hosting provider related issues
● Backup Space & Software Licenses

Our Delighted Customers

● Grand Cinemas – UAE

● United Arab Bank – UAE
● Harley – UAE
● Ducati – UAE

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 ● Pulse Leads – USA
● ALMA Interiors
● SECUR-I-T
● KASE

2.1.9 Software Testing Service and QA Consulting

Summary

Focusing on providing the best possible solutions for clients across all domains, Zen
Aspirations provides independent testing services and QA consulting through dedicated
offshore teams and on-site experts. The proficiency we have gained in software product
testing and QA services over the years help in building strong practices and improve the
delivery process to the advantage of clients.

Zen Aspirations endeavors to provide the best possible and highest quality of QA consulting
and independent software testing services at cost-effective price.

Zen Aspirations has the caliber and ample capability to develop test modules for diverse
software products according to the clients‘ requirements and offer complete QA services and
software testing solutions. Zen Aspirations offer high-end software testing programs and test
solutions to independent software vendors (ISVs), software product companies, and SMEs.

Scope of work

● Independent testing services for all sectors, including retail, e-commerce, e-

learning, gaming, health-care, mobile, IT, social media, finance
● End-to-end web application testing services, including component and unit
testing, core testing services, database and platform testing, functional testing,
performance testing, localization testing, network security testing, SOA and web
services testing, system testing, and usability and content testing.
● Development of complete test automation framework, including Selenium
automation testing, identification of the best and the most-cost-effective tools,
functional test automation, and performance test automation.

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 ● Complete test management, including test case management, test strategy
formulation, test design and approach, crafting of test models and planning, test
cases development, test execution, QA coordination and testing estimation.
Testing Domains

● Finance
● Mobile
● ecommerce
● Health care
● Retail
● Social Media
● Enterprise Application Integration
● Mobile Devices for various platforms
Core Testing Services

● Performance Testing Service

● Functional Testing Service
● Consulting Service
● Selenium Automation service
● Mobile Apps Testing
● Usability and Content Testing
● Security Testing
● Quality Assurance post release
Key Success

● Scalable Infrastructure
● Inspired testing resource
● Flexible business model
Key Tools

● Functional: QTP, Winrunner, Selenium

● Performance: Open STA, Load Runner, JMeter
● Bug Tracking: Bugzilla, Quality Centre, Team Track
● Test Management: Quality Centre, Testopia

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2.2 Profile of Indian IT Industry

2.2.1 Introduction
Information technology in India is an industry consisting of two major components: IT
Services and business process outsourcing (BPO). The sector has increased its contribution to
India's GDP from 1.2% in 1998 to 7.5% in 2012. According to NASSCOM, the sector
aggregated revenues of US$100 billion in 2012, where export and domestic revenue stood at
US$69.1 billion and US$31.7 billion respectively, growing by over 9%. Information
technology is playing an important role in India today & has transformed India's image from
a slow moving bureaucratic economy to a land of innovative entrepreneurs.

The IT sector in India is generating 2.5 million direct employments. India is now one of the
biggest IT capitals of the modern world and all the major players in the world IT sector are
present in the country. Last Updated: April, 2014

India is a preferred global destination for information technology (IT) and information
technology enabled services (ITeS). The Indian IT-business process management (BPM)
sector is estimated to expand at a compound annual growth rate (CAGR) of 9.5 per cent to
reach US$ 300 billion by 2020. The sector increased at a CAGR of 25 per cent over 2000–13,
3–4 times higher than global IT-BPM spends.

Export of IT services accounted for 57.9 per cent of total IT exports in FY 13. Banking,
financial services and insurance (BFSI) generated export revenue of around US$ 31 billion
during FY 13, accounting for 41 per cent of total IT-BPM exports from India.

Demand from emerging countries is expected to show strong growth going forward. Tax
holidays are also extended to the IT sector for software technology parks of India (STPI) and
special economic zones (SEZs). Further, the country is providing procedural ease and single
window clearance for setting up facilities. The country‘s cost competitiveness in providing IT
services, which is approximately 3–4 times cheaper than the US, continues to be its USP in
the global sourcing market.

Disruptive technologies present an entire new gamut of opportunities for IT firms in India.
India‘s IT sector is gradually moving from linear models (rising headcount to increase

22
revenue) to non-linear ones. In line with this, IT companies in India are focusing on new
models such as platform-based BPM services and creation of intellectual property.

The major cities that account for about nearly 90% of the sector's exports are Bangalore,
Chennai, Kolkata, Hyderabad, Trivandrum, Noida, Mumbai and Pune. Bangalore is
considered to be the Silicon Valley of India because it is the leading IT exporter.[3][4] Exports
dominate the industry and constitute about 77% of the total industry revenue. However, the
domestic market is also significant with a robust revenue growth.[1] The industry‘s share of
total Indian exports (merchandise plus services) increased from less than 4% in FY1998 to
about 25% in FY2012. According to Gartner, the "Top Five Indian IT Services Providers" are
Tata Consultancy Services, Infosys, Cognizant, Wipro and HCL Technologies.[5]

Regulated VSAT links became visible in 1994.[6] Desai (2006) describes the steps taken to
relax regulations on linking in 1991:

In 1991 the Department of Electronics broke this impasse, creating a corporation called
Software Technology Parks of India (STPI) that, being owned by the government, could
provide VSAT communications without breaching its monopoly. STPI set up software
technology parks in different cities, each of which provided satellite links to be used by firms;
the local link was a wireless radio link. In 1993 the government began to allow individual
companies their own dedicated links, which allowed work done in India to be transmitted
abroad directly. Indian firms soon convinced their American customers that a satellite link
was as reliable as a team of programmers working in the clients‘ office.

Videsh Sanchar Nigam Limited (VSNL) introduced Gateway Electronic Mail Service in
1991, the 64 kbit/s leased line service in 1992, and commercial Internet access on a visible
scale in 1992. Election results were displayed via National Informatics Centre's NICNET.

The Indian economy underwent economic reforms in 1991, leading to a new era of
globalization and international economic integration. Economic growth of over 6% annually
was seen during 1993-2002. The economic reforms were driven in part by significant the
internet usage in the country. The new administration under AtalBihari Vajpayee 1999 govt
pm—which placed the development of Information Technology among its top five
priorities— formed the Indian National Task Force on Information Technology and Software
Development.

23
Wolcott & Goodman (2003) report on the role of the Indian National Task Force on
Information Technology and Software Development:

Within 90 days of its establishment, the Task Force produced an extensive background report
on the state of technology in India and an IT Action Plan with 108 recommendations. The
Task Force could act quickly because it built upon the experience and frustrations of state
governments, central government agencies, universities, and the software industry. Much of
what it proposed was also consistent with the thinking and recommendations of international
bodies like the World Trade Organization (WTO), International Telecommunications Union
(ITU), and World Bank. In addition, the Task Force incorporated the experiences of
Singapore and other nations, which implemented similar programs. It was less a task of
invention than of sparking action on a consensus that had already evolved within the
networking community and government.

"The New Telecommunications Policy, 1999" (NTP 1999) helped further liberalize India's
telecommunications sector. The Information Technology Act 2000 created legal procedures
for electronic transactions and e-commerce.

Throughout the 1990s, another wave of Indian professionals entered the United States. The
number of Indian Americans reached 1.7 million by 2000. This immigration consisted largely
of highly educated technologically proficient workers. Within the United States, Indians fared
well in science, engineering, and management. Graduates from the Indian Institutes of
Technology (IIT) became known for their technical skills. The success of Information
Technology in India not only had economic repercussions but also had far-reaching political
consequences. India's reputation both as a source and a destination for skilled workforce
helped it improve its relations with a number of world economies. The relationship between
economy and technology—valued in the western world—facilitated the growth of an
entrepreneurial class of immigrant Indians, which further helped aid in promoting
technology-driven growth.

24
2.2.2 Major IT Hubs

Rank Description
Popularly known as the Silicon Valley of India and leading
1 Bangalore software exporter from India. Bangalore is considered to be a
global information technology hub of India.
Chennai is the Second largest exporter of IT and ITES of India,
2 Chennai
and is the BPO hub of India
Hyderabad is a major IT hub in India. It has become the first
destination for the Microsoft development centre in India and
largest software development centre outside of their headquarters
3 Hyderabad in Redmond, Washington. It is also known as Cyberabad which
consists of many Multinational corporation companies such as
Google, Facebook, Microsoft, Amazon, Oracle and Electronic
Arts, AT&T, Deloitte etc. .[9]
The Financial capital of India, but recently many IT companies
4 Mumbai
have established offices.
The National Capital Region comprising Delhi, Gurgaon and
5 Delhi
Noida are clusters of software development.
Major Indian and International Firms present in Pune. Pune is
6 Pune
also C-DAC headquarters.
7 Kolkata The city is a major back-end operational hub for IBM, Deloitte.
The capital city of Odisha, an emerging IT and education hub, is
8 Bhubaneswar
one of India's fastest developing cities.
The capital of Kerala, now houses all major IT companies
9 Thiruvananthapuram including Oracle, TCS, Infosys, and contributes in IT export of
India.
The commercial capital of Kerala, now houses all major IT
10 Kochi companies including TCS, Cognizant, and contributes in IT
export of India.

25
2.2.3 EMPLOYMENT

This sector has also led to massive employment generation. The industry continues to be a net
employment generator - expected to add 230,000 jobs in FY2012, thus providing direct
employment to about 2.8 million, and indirectly employing 8.9 million people.[1] Generally
dominant player in the global outsourcing sector. However, the sector continues to face
challenges of competitiveness in the globalized and modern world, particularly from
countries like China and Philippines.

India's growing stature in the Information Age enabled it to form close ties with both the
United States of America and the European Union. However, the recent global financial
crises has deeply impacted the Indian IT companies as well as global companies. As a result
hiring has dropped sharply, and employees are looking at different sectors like the financial
service, telecommunications, and manufacturing industries, which have been growing
phenomenally over the last few years. India's IT Services industry was born in Mumbai in
1967 with the establishment of Tata Group in partnership with Burroughs.[11] The first
software export zone SEEPZ was set up here way back in 1973, the old avatar of the modern
day IT Park. More than 80 percent of the country's software exports happened out of SEEPZ,
Mumbai in 1980s.

2.2.4 FUTURE OUTLOOK:

The Indian IT market currently focuses on providing low cost solution in the services
business of global IT. Presence of Indian companies in the product development business of
global IT is very meagre, however, this number is slowly on the raise. US giants that
outsource work to India, do not allocate the high end SDLC (Software Development Life
Cycle) processes like requirement analysis, high level design and architectural design,
although some Indian IT players have enough competency to take up and successfully
complete these high level software jobs. The other prominent trend is, IT jobs, that were
earlier confined to Bangalore, are slowly starting to experience a geographical diffuse into
other cities like Chennai, Hyderabad and Pune. The growth is not fast paced, this, can be
largely attributed to the lethargic attitude of the government in providing proper
telecommunication infrastructure. The penetration levels are higher for mobile, but, the speed
at which the backbone infrastructure works (network speed) and the coverage it offers are far
below what other countries of the world have currently in offer.

26
The Indian Advantage

The above listed views might possibly work against India‘s‘ dream to become the biggest
contributor to world IT business, but, if there is one factor that is particular only to India, and,
the one that can nullify all negative factors lined up against it, would be, the volume of
young, English speaking talent pool that India has got to offer. This number far exceeds, any
other country can generate in the coming years. It cannot be denied that China is gearing up
to reduce the English fluency gap, but, at the same time, doing it with ease like India, is a
topic of discussion.

2.3 Products & Achievements

Healthcare

Zen Aspirations uses its strong technical knowledge and domain expertise to help clients in
the healthcare industry with application development, system integration and other custom
software needs. Our areas of medical software development expertise cover insurance claims
processing solutions, data collection and analysis tools, medical hardware integration, mobile
and web based applications and more.

Media & Entertainment

Market realities continue to reshape the media and entertainment industry: Technology
platforms are evolving rapidly, new business models are emerging, consumer viewing habits
are changing and new competition is arising from multiple sectors. Zen Aspirations helps
media and entertainment companies adapt to the realities of the digital age, breaking new
ground to simplify operations, better understand consumers, provide content effectively and
capitalize on new opportunities.

Banking & Finance

Banking and Finance, one of the industries requiring high intellect, is growing faster than
ever before. To cater to the demand of this challenging, interesting and vast sector, Zen
Aspirations has all the necessary infrastructure and expertise and proven expertise in banking
application customization sector.

27
Retail & Shopping

The success of retailing lies in providing the consumer with the right product – at the right
time and at the right place. Achieving Clear understanding of customer needs, Well-run store
operations, Seamless and efficient Supply Chain, Proper matching demand and supply to
enable the maintenance of stocks at each location.

Zen Aspirations has worked extensively on designing and developing retail and shopping
applications with state of the art technology which has provided a competitive advantage for
the customers.

Logistics & CRM

Transportation and Logistics Services covers a range of activities dealing with how resources
are acquired, and transported in addition to how they are managed while in transit along the
supply chain. Today‘s transport services represent global activities with complex partnering
and logistical relationships all operating within tight time constrains. It is a competitive
industry and customers typically expect competitive pricing offers in an effort to enhance
their own sales activities.

Social Media

Social Media is the best method for increasing on-line presence on social networks. Zen
Aspirations helps you in launching and managing the successful Social Media Campaign or
Social Media Marketing applications using various latest techniques.

User Experience

―User experience‖ encompasses all aspects of the end-user‘s interaction with the company, its
services, and its products. The first requirement for an exemplary user experience is to meet
the exact needs of the customer. Next comes simplicity and elegance that produce products
that are a joy to own, a joy to use. True user experience goes far beyond giving customers
what they say they want. In order to achieve high-quality user experience Zen Aspirations
provides seamless merging of the services of multiple disciplines, including engineering,
marketing, graphical and industrial design, and interface design.

28
Insights

Managed IT Services (MIS)

Managed End-user Services

Managed end-user services would address the end-to-end IT support requirement of the end-
users of the client organization, right from logging the support request to owning the service
resolution process and completing the service calls. Two important components in end-user
management are Managed Service Desk, and Managed Desktop Support.

Managed Network Services

Managed network services provides, comprehensive 24×7 monitoring, administration and

troubleshooting services for the enterprise network infrastructure of the client. Any devices
that are part of client network and supports SNMP could be managed under this scope. The
typical network elements covered include, Network links, Routers, Multiplexers, Switches, IP
Telephony, Content Distribution Devices, Video Conferencing Equipment, Wi-Fi Devices, IP
Surveillance, Bandwidth Management products, Link Load-balancers, etc.

Managed Security Services

Comprehensive managed information security services, right from monitoring the availability
of information security assets such as, Firewall, VPN, IDS, IPS, Anti-x, etc., to online
monitoring of authentication process, integrity of security policies, events, alerts, and
performance of these products

Managed Datacenter Services

Managed Datacenter Services, spans multiple technology domains including, Server

Management, Database Management, Storage / Back-up Management, Messaging /
Collaboration Management and Web Server Management, Antivirus Management. The
service covers, monitoring, administration and incident support services for the datacenter
components.

Managed Server Support

● Managed Database Support / Remote Database Management

● Messaging Support
● Storage & Back-up Support

29
 ● Managed Application Services
● Network Architecture Design and Implementation
● LAN/WAN Administration
● Network Security Management (Firewalls, VPN Policies)
Application Software and Middleware Support

Wide range of application support services through a defined methodology, based on multiple
cycles of operations. We provide IT service desk support along with monitoring, scheduling,
managing, and routine operations of the business applications.

Technology Solutions & Services (TSS)

Enterprise Architecture

● Solution architecture
● Business Applications
● Engineering & Manufacturing
● Finance / Controlling / Tax / Customs
● Supply Chain Management
● Human Resource
● Sales and Marketing
● Data and database Architecture
● Network Architecture
● Infrastructure Architecture
● Application Architecture
● Information Security Architecture
Infrastructure Services

● End-user computing devices desktop

● DNS, DHCP, Email, AD/LDAP
● PBX
● Call Manager
● Station Services
● IP Telephone and soft-phones
Data Center & Hosting

● Load-balancing

30
 ● High-availability, redundancy and replication
● Disaster Recovery Planning processes and procedures
● Backup/Restore/Archive
● Site management
● Power management
● Physical and access security
End User Computing

● Desktop applications
● Operating systems
● Configuration and systems administration
Application Development

● SDLC
● Functional Specification
● Technical Specification
● Programming
● Systems analysis
● System Design
● Database design
● Systems testing and UAT
Life Cycle Management

● Change management
● Release Management
● Configuration management
● License Management (renewal & maintenance)
● Hardware/Software Maintenance
● Asset management
● OLA and SLA
● Escalation and rapid response management
● Compatibility and compliance management
● Documentation Management

31
2.4 Performance Appraisal in Zen Aspirations Pvt Ltd

Some of the salient features of the performance appraisal system are as under:-
a. Quarterly task setting and evaluation on a quarterly basis.
b. Traits based on the responsibilities associated with each level.
c. Self- appraisal by the officers at all levels.
d. Qualitative assessment, management review categorisation & identification of training
and developmental needs.

Performance Appraisal Format

Table 2.1
Performance Appraisal Format
TO BE
PART CONTENTS
FILLED BY

COVER PAGE Bio-data of the Appraisee Appraisee

Quarterly Task Setting and Appraisee &

PART-A
Assessment HR
Self Appraisal

PART-B HR
Comments on Self Appraisal &
Integrity

PART-C Assessment of Traits HR

PART-D Training and Development Needs HR

PART-A : Quarterly Task Setting and Assessment

The revised Performance Appraisal System envisages setting up Quarterly
Tasks between the Appraisee and the HR manager. The set tasks would be recorded on the
Quarterly Task Setting and Assessment Sheets .At the time of setting the tasks, the HR
department analyses the accomplishment of tasks

32
 Table 2.2
Quarterly Task Setting Period

Quarter Period

I 1st April to 30th June

II 1st July to 30th September

III 1st October to 31st December

IV 1st January to 31st March

The Task Setting for each Quarter would be done, jointly by the Appraisee and
IA, by the 7th of the first month of each Quarter. The maximum marks of 100 would be
distributed among all the tasks, based on their relative weight age or importance. Separate
task setting and assessment sheets are to be used for each and the same would be signed both
by the Appraisee and the HR. The task setting sheets would be prepared in duplicate and one
copy will be with the Appraisee and the other with the HR. The tasks set should be as far as
possible are quantitative or measurable, either in terms of quantity or time limits. The HR
would evaluate the performance of the appraisee, by 7th of the 1st month of the subsequent
quarter, after joint discussion with the appraisee, against the set tasks and will award marks
for each task, keeping in view the maximum marks decided for each task at the beginning of
the quarter. Completed task setting and assessment sheet of each quarter would be retained by
the HR Department and the same would be attached by him with the Annual / probationary
Performance Appraisal Review at the end of the assessment year / period.
PART-B: Self-Appraisal
All employees should assess themselves in Part-B of the appraisal format. Self-Appraisal is
aimed at providing employees an opportunity to assess their performance against mutually
agreed tasks. Self-Appraisal should be brief and to the point. Comments on the Self-
Appraisal by the HR are to be made in the space provided. Self-Appraisal by officers should
also be taken into account by the HR department.

33
PART-C: Assessment of Traits
The skills required to be possessed by an employee vary as he moves from one
level to the next. Keeping this aspect in view, separate set of traits against which officers are
to be assessed have been devised. Assessments of the traits have to be made of the format,
indicating marks scored for each trait, out of maximum marks allotted for each trait, by the
HR department
For the first trait (performance), marks awarded by the HR will be the
equivalent % of the average marks for the year awarded by him in part-A. For example, if the
average marks awarded by the HR in part-A for a year is 70 out of 100, marks against
performance in part C.1 for an employee will be 56(i.e. 80 % of 70). For the remaining traits,
the HR has to award marks individually out of the maximum marks indicated against each
trait.
Scale of Gradation:
Table 2.3
Scale of Gradation
TOTAL MARKS 100-90 89-80 79-50 BELOW 50
Below
Performance Rating Exceptional Above Average Average
Average

PART-D: Training / Development Needs

The HR department should indicate specific areas to which the Appraisee
should be job rotated as well as training to be given to prepare him for future advancements.

Feedback System
All employees who have scored final marks of below 50 and rated as below
average would be given effective feedback about his/her performance .

34
 CHAPTER- III
THEORETICAL FRAMEWORK & REVIEW
OF LITERATURE

35
 THEORETICAL FRAMEWORK & LITERATURE REVIEW

Empirical studies
Sample design is a definite plan for obtaining sample from a given population.
It refers to the procedure, adopted by a researcher for selecting items for a sample. In this
project random sampling method is used. The respondents are the employees of Zen
Aspiration Pvt Ltd, Trivandrum. Sample population in the organization is 110. In this study
the sample size is 54 employees.
The research was conducted by using contact instruments like questionnaire, interview
and observation. Questions were prepared accordingly in line with the scaling method. Five
point scales used here are highly agree, agree, neutral, disagree, highly disagree, are used
here.

The data is analyzed through simple percentage method. It is a useful method of

expressing the relative frequency of survey responses and other data. The percentage
frequency distributions are displayed as tables and bar graphs. Another Tool used was SPSS
to find out the role of performance appraisal in employee motivation. Here SPSS software is
used to find out the Regression and correlation of how much percentage performance
appraisal contributes in employee motivation for that the variables considered is performance
appraisal and employee motivation. Here employee motivation as Dependent variable and
Performance appraisal as Independent variable.

The theoretical framework of the study is a structure that

supports a theory of a study work. It presents the theory which explains why the problem
under the study exists. Thus, the theoretical framework is a theory that serves as a basis for
conducting research. The main purpose is to help us to see clearly the variables that pertain to
the study. It can provide us with a general framework for data analysis and it is essential in
preparing a study using descriptive methods.

3.1 Performance Appraisal

A performance appraisal (PA), performance review, performance evaluation, or

employee appraisal is a method by which the job performance of an employee is evaluated.

36
Performance appraisals are a part of guiding and managing career development. It is the
process of obtaining, analyzing and recording information about the relative worth of an
employee to the organization. Performance appraisal is an analysis of an employee‘s recent
successes and failures, personal strengths and weaknesses, and suitability for promotion or
further training. It is also the judgment of an employee‘s performance in a job based on
considerations other than productivity alone.

3.1.1 Main Features

A performance appraisal is a systematic and periodic process that assesses an

individual employee‘s job performance and productivity in relation to certain pre-established
criteria and organizational objectives. Other aspects of individual employees are considered
as well, such as organizational citizenship behavior, accomplishments, potential for future
improvement, strengths and weaknesses, etc. To collect PA data, there are three main
methods: objective production, personnel, and judgmental evaluation. Judgmental evaluations
are the most commonly used with a large variety of evaluation methods. Historically, PA has
been conducted annually (long-cycle appraisals), however many companies are moving
towards shorter cycles (every six months, every quarter), and some have been moving into
short-cycle (weekly, bi-weekly) PA. The interview could function as ―providing feedback to
employees, counseling and developing employees, and conveying and discussing
compensation, job status, or disciplinary decisions‖. PA is often included in performance
management systems. Performance management systems are employed ―to manage and
align" all of an organization's resources in order to achieve highest possible
performance. How performance is managed in an organization determines to a large extent
the success or failure of the organization. Therefore, improving PA for everyone should be
among the highest priorities of contemporary organizations.

Some applications of PA are compensation, performance improvement,

promotions, termination, test validation, and more. While there are many potential benefits of
PA, there are also some potential drawbacks. For example, PA can help facilitate
management-employee communication; however, PA may result in legal issues if not
executed appropriately as many employees tend to be unsatisfied with the PA process.

37
3.1.2 Potential Benefits of Performance Appraisals

There are a number of potential benefits of organizational performance

management conducting formal performance appraisals (PAs). There has been a
general consensus in the belief that PAs lead to positive implications of
organizations. Furthermore, PAs can benefit an organization‘s effectiveness. One way is PAs
can often lead to giving individual workers feedback about their job performance. From this
may spawn several potential benefits such as the individual workers becoming more
productive.

Other potential benefits include:

 Facilitation of communication: communication in organizations is considered an

essential function of worker motivation. It has been proposed that feedback from PAs
aid in minimizing employees‘ perceptions of uncertainty. Fundamentally, feedback
and management-employee communication can serve as a guide in job performance.
 Enhancement of employee focus through promoting trust: behaviors, thoughts,
and/or issues may distract employees from their work, and trust issues may be among
these distracting factors. Such factors that consume psychological energy can lower
job performance and cause workers to lose sight of organizational goals. Properly
constructed and utilized PAs have the ability to lower distracting factors and
encourage trust within the organization.
 Goal setting and desired performance reinforcement: organizations find it efficient
to match individual worker‘s goals and performance with organizational goals. PAs
provide room for discussion in the collaboration of these individual and organizational
goals. Collaboration can also be advantageous by resulting in employee acceptance
and satisfaction of appraisal results.
 Performance improvement: well-constructed PAs can be valuable tools for
communication with employees as pertaining to how their job performance stands
with organizational expectations. ―At the organizational level, numerous studies have
reported positive relationships between human resource management (HRM)
practices" and performance improvement at both the individual and organizational
levels.

38
  Determination of training needs: ―Employee training and development are crucial
components in helping an organization achieve strategic initiatives‖. It has been
argued that for PAs to truly be effective, post-appraisal opportunities for training and
development in problem areas, as determined by the appraisal, must be offered. PAs
can especially be instrumental for identifying training needs of new employees.
Finally, PAs can help in the establishment and supervision of employees‘ career
goals.

3.1.3 Improving Performance Appraisals

Although performance appraisals can be so easily biased, there are certain steps
that can be taken to improve the evaluations and reduce the margin of errors through the
following:

 Training: Creating an awareness and acceptance in the people conducting the

appraisals that within a group of workers, they will find a wide range in difference of
skills and abilities.

 Providing Feedback to Raters: Trained raters provide managers who evaluated

their subordinates with feedback, including information on ratings from other
managers. This reduces leniency errors.

 Subordinate Participation: By allowing employee participation in the evaluation

process, there is employee-supervisor reciprocity in the discussion for any
discrepancies between self-ratings and supervisor ratings, thus, increasing job
satisfaction and motivation.

3.1.4 Objectives of Performance Appraisal

 To measure and improve the performance of employees and increase their future
potential and value to the company.
 To provide a feedback to employees regarding their performance and related status.
 Performance appraisal makes it easier for the organization to make good decisions
about making sure that the most important positions are filled by the most capable
individuals.
 Performance appraisal helps make sure that the most talented individuals are retained
and to identify poor performers who affects the productivity of the organization.

39
  A good performance appraisal points out areas where individuals need to improve
their performance.
 Performance appraisal helps motivate people to deliver superior performance in
several ways.
 The performance appraisal process is commonly used to make sure that every member
of the organization sets and achieves effective goals.
 Performance appraisal forces managers to confront those whose performance is not
meeting the company‘s expectations.
 Performance appraisal provides the mechanism to make sure that those who do better
work receive more pay.
 It identifies the areas where coaching is necessary and encourages managers to take an
active coaching role.
 It determines Individual Training and Development Needs.
 A performance appraisal procedure allows the organization to communicate
performance expectations to every member of the team and assess exactly how well
each person is doing.
 It serves 0as a basis for influencing working habits of the employees.

3.1.5 Techniques/Methods of Performance Appraisal

Numerous methods have been devised to measure the quantity and quality of performance
appraisals. Each of the methods is effective for some purposes for some organizations only.
None should be dismissed or accepted as appropriate except as they relate to the particular
needs of the organization or an employee.

Broadly all methods of appraisals can be divided into two different categories.

 Past Oriented Methods

 Future Oriented Methods

3.1.5.1 Past Oriented Methods

1. Rating Scales: Rating scales consists of several numerical scales representing job related
performance criterions such as dependability, initiative, output, attendance, attitude etc.
Each scales ranges from excellent to poor. The total numerical scores are computed and
final conclusions are derived. Advantages – Adaptability, easy to use, low cost, every

40
 type of job can be evaluated, large number of employees covered, no formal training
required. Disadvantages – Rater‘s biases

2. Checklist: Under this method, checklist of statements of traits of employee in the form
of Yes or No based questions is prepared. Here the rater only does the reporting or
checking and HR department does the actual evaluation. Advantages – economy, ease of
administration, limited training required, standardization. Disadvantages – Raters biases,
use of improper weighs by HR, does not allow rater to give relative ratings

3. Forced Choice Method: The series of statements arranged in the blocks of two or more
are given and the rater indicates which statement is true or false. The rater is forced to
make a choice. HR department does actual assessment. Advantages – Absence of
personal biases because of forced choice. Disadvantages – Statements may be wrongly
framed.

4. Forced Distribution Method: here employees are clustered around a high point on a
rating scale. Rater is compelled to distribute the employees on all points on the scale. It is
assumed that the performance is conformed to normal distribution. Advantages –
Eliminates Disadvantages – Assumption of normal distribution, unrealistic, errors of
central tendency.

5. Critical Incidents Method: The approach is focused on certain critical behaviors of

employee that makes all the difference in the performance. Supervisors as and when they
occur record such incidents. Advantages – Evaluations are based on actual job behaviors,
ratings are supported by descriptions, feedback is easy, reduces recency biases, chances
of subordinate improvement are high. Disadvantages – Negative incidents can be
prioritized, forgetting incidents, overly close supervision; feedback may be too much and
may appear to be punishment.

6. Behaviorally Anchored Rating Scales: statements of effective and ineffective

behaviors determine the points. They are said to be behaviorally anchored. The rater is
supposed to say, which behavior describes the employee performance. Advantages –
helps overcome rating errors. Disadvantages – Suffers from distortions inherent in most
rating techniques.

41
7. Field Review Method: This is an appraisal done by someone outside employees‘ own
department usually from corporate or HR department. Advantages – Useful for
managerial level promotions, when comparable information is needed, Disadvantages –
Outsider is generally not familiar with employees work environment, Observation of
actual behaviors not possible.

8. Performance Tests & Observations: This is based on the test of knowledge or skills.
The tests may be written or an actual presentation of skills. Tests must be reliable and
validated to be useful. Advantage – Tests may be apt to measure potential more than
actual performance. Disadvantages – Tests may suffer if costs of test development or
administration are high.

9. Confidential Records: Mostly used by government departments, however its application

in industry is not ruled out. Here the report is given in the form of Annual Confidentiality
Report (ACR) and may record ratings with respect to following items; attendance, self-
expression, team work, leadership, initiative, technical ability, reasoning ability,
originality and resourcefulness etc. The system is highly secretive and confidential.
Feedback to the assesse is given only in case of an adverse entry. Disadvantage is that it
is highly subjective and ratings can be manipulated because the evaluations are linked to
HR actions like promotions etc.

10. Essay Method: In this method the rater writes down the employee description in detail
within a number of broad categories like, overall impression of performance, promote
ability of employee, existing capabilities and qualifications of performing jobs, strengths
and weaknesses and training needs of the employee. Advantage – It is extremely useful
in filing information gaps about the employees that often occur in a better-structured
checklist. Disadvantages – It its highly dependent upon the writing skills of rater and
most of them are not good writers. They may get confused success depends on the
memory power of raters.

11. Cost Accounting Method: Here performance is evaluated from the monetary returns
yields to his or her organization. Cost to keep employee, and benefit the organization
derives is ascertained. Hence it is more dependent upon cost and benefit analysis.

42
12. Comparative Evaluation Method (Ranking & Paired Comparisons): These are
collection of different methods that compare performance with that of other co-workers.
The usual techniques used may be ranking methods and paired comparison method.

 Ranking Methods: Superior ranks his worker based on merit, from

best to worst. However how best and why best are not elaborated in
this method. It is easy to administer and explanation.
 Paired Comparison Methods: In this method each employee is rated
with another employee in the form of pairs. The number of
comparisons may be calculated with the help of a formula as under.
N x (N-1) / 2

3.1.5.2 Future Oriented Methods

1. Management by Objectives: It means management by objectives and the performance

is rated against the achievement of objectives stated by the management. MBO process
goes as under.
 Establish goals and desired outcomes for each subordinate
 Setting performance standards

 Comparison of actual goals with goals attained by the employee

 Establish new goals and new strategies for goals not achieved in previous year.
Advantage – It is more useful for managerial positions.

Disadvantages – Not applicable to all jobs, allocation of merit pay may result in setting
short-term goals rather than important and long-term goals etc.

2. Psychological Appraisals: These appraisals are more directed to assess employees‘

potential for future performance rather than the past one. It is done in the form of in-
depth interviews, psychological tests, and discussion with supervisors and review of
other evaluations. It is more focused on employees emotional, intellectual, and
motivational and other personal characteristics affecting his performance. This approach
is slow and costly and may be useful for bright young members who may have

43
 considerable potential. However quality of these appraisals largely depends upon the
skills of psychologists who perform the evaluation.

3. Assessment Centers: This technique was first developed in USA and UK in 1943. An
assessment center is a central location where managers may come together to have their
participation in job related exercises evaluated by trained observers. It is more focused
on observation of behaviors across a series of select exercises or work samples. Assesses
are requested to participate in in-basket exercises, work groups, computer simulations,
role playing and other similar activities which require same attributes for successful
performance in actual job. The characteristics assessed in assessment center can be
assertiveness, persuasive ability, communicating ability, planning and organizational
ability, self-confidence, resistance to stress, energy level, decision making, sensitivity to
feelings, administrative ability, creativity and mental alertness etc. Disadvantages –
Costs of employees traveling and lodging, psychologists, ratings strongly influenced by
assessee‘s inter-personal skills. Solid performers may feel suffocated in simulated
situations. Those who are not selected for this also may get affected.
Advantages – well-conducted assessment center can achieve better forecasts of future
performance and progress than other methods of appraisals. Also reliability, content
validity and predictive ability are said to be high in assessment centers. The tests also
make sure that the wrong people are not hired or promoted. Finally it clearly defines the
criteria for selection and promotion.

5. 360-Degree Feedback: It is a technique which is systematic collection of

performance data on an individual group, derived from a number of stakeholders like
immediate supervisors, team members, customers, peers and self. In fact anyone who
has useful information on how an employee does a job may be one of the appraisers.
This technique is highly useful in terms of broader perspective, greater self-
development and multi-source feedback is useful. 360-degree appraisals are useful to
measure inter-personal skills, customer satisfaction and team building skills. However
on the negative side, receiving feedback from multiple sources can be intimidating,
threatening etc. Multiple raters may be less adept at providing balanced and objective
feedback.

44
3.2 Employee Motivation

Employee motivation is the "psychological forces that determine the direction of a person's
behavior in an organization, a person's level of effort and a person's level of persistence".

3.2.1 Motivational techniques

3.2.1.1 Job design

The design of an employee‘s job can have a significant impact on their job motivation. Job
design includes designing jobs that create both a challenging and interesting task for the
employee and is effective and efficient for getting the job done. Four approaches to job
design are:

1. Job Simplification: The goal of this job design approach is to standardize and
specialize tasks. Unfortunately this approach does not always lead to increased
motivation as the jobs can become mundane.
2. Job Enlargement: The goal of this job design approach is to combine tasks to
give the employee a greater variety of work.
3. Job Rotation: The goal of this job design approach is to move workers to
different tasks periodically.
4. Job Enrichment: The key to job design employee motivation, this approach
aims to enhance the actual job by building up the employee through
motivational factors.

Several studies validate the effectiveness of using job design techniques as an employee
motivation technique. A study conducted by Campion and Thayer used a job design
questionnaire to determine how job designs fostering motivation affected employees.
Campion and Thayer found that jobs with more motivational features have lower effort
requirements, a better well-being, and fewer health complaints. The study also found that jobs
scoring high on the motivational subscale of the questionnaire contained employees who
were more satisfied and motivated, had a higher rating pertaining to job performance, and had
fewer absences. Hackman conducted a study pertaining to work redesign and how
redesigning work could improve productivity and motivation through job enlargement or
enrichment. The study‘s results found that redesigning a job can improve the quality of the
product or service that is provided, increase the quantity of work, and can increase work
satisfaction and motivation. The last study on job design was conducted by Dunham who

45
wanted to determine if there was a relationship between job design characteristics and job
ability and compensation requirements. Dunham believed organizations were overlooking job
ability requirements and compensation when they enlarged or enriched employee‘s jobs. The
study found that organizations were not taking into account the increased job ability
requirements that job enrichments or enlargements entail nor were the organizations
increasing compensation for employees who were given extra tasks and/or more complex
tasks

3.2.1.2 Rewards

Using rewards as motivators divides employee motivation into two categories: intrinsic and
extrinsic motivation. Intrinsic rewards are internal, psychological rewards such as a sense of
accomplishment or doing something because it makes one feel good. Extrinsic rewards are
rewards that other people give to you such as a money, compliments, bonuses, or trophies.

Many studies have been conducted concerning how motivation is affected by rewards
resulting in conflicting and inconsistent outcomes. Pierce, Cameron, Banko, and So
conducted a study to examine how extrinsic rewards affect people‘s intrinsic motivation
when the rewards are based on increasingly higher performance criteria. Pierce et. al. found
that rewarding people for meeting a graded level of performance, which got increasingly
more difficult, spent more time on the study‘s activities and experienced an increase in
intrinsic motivation. Participants who were not rewarded at all or only rewarded for
maintaining a constant level of performance experienced less intrinsic motivation. Another
study that examined the effects of extrinsic rewards on intrinsic motivation was conducted by
Wiersma. Wiersma conducted a meta-analysis to summarize the inconsistent results of past
studies. The meta-analysis by Wiersma concluded that when extrinsic rewards are given by
chance, they reduce intrinsic motivation. This result is supported when task behavior is
measured during a free-time period. However, it is not supported when task performance is
measured when the extrinsic reward is in effect. Wiersma also found that these results cannot
be generalized to all situations. A study conducted by Earn also examined the effects of
extrinsic rewards on intrinsic motivation. Earn wanted to know if extrinsic rewards had an
impact on a person‘s intrinsic motivation based on the subject‘s locus of control. Earn found
that pay increases decreased intrinsic motivation for subjects with an external locus of control
whereas pay increases increased intrinsic motivation for subjects with an internal locus of
control. The study also found that when the controlling aspect of the extrinsic reward was

46
made pertinent by making pay dependent on a certain amount of performance, higher pay
undermined the intrinsic motivation of subjects and their locus of control was not relevant

3.2.1.3 Intrinsic rewards: Job Characteristics Model

The Job Characteristics Model (JCM), as designed by Hackman and Oldham attempts to use
job design to improve employee intrinsic motivation. They show that any job can be
described in terms of five key job characteristics:

1. Skill Variety - the degree to which the job requires the use of different skills
and talents
2. Task Identity - the degree to which the job has contributed to a clearly
identifiable larger project
3. Task Significance - the degree to which the job has an impact on the lives or
work of other people
4. Autonomy - the degree to which the employee has independence, freedom and
discretion in carrying out the job
5. Task Feedback - the degree to which the employee is provided with clear,
specific, detailed, actionable information about the effectiveness of his or her
job performance

The JCM links the core job dimensions listed above to critical psychological states which
results in increased employee intrinsic motivation. This forms the basis of this 'employee
growth-need strength." The core dimensions listed above can be combined into a single
predictive index, called the Motivating Potential Score.

3.2.1.4 Employee participation

1. Increase employee participation by implementing quality control circles. Quality control

circles involve a group of five to ten problem solving employees that come together to solve
work-related problems such as reducing costs, solving quality problems, and improving
production methods. Other benefits from quality control circles include an improved
employee-management relationship, increased individual commitment, and more
opportunities for employee expression and self-development.

A study by Marks et al.focused on assessing the impact quality circles had on participating
employees and found that the attitudes of employees who participated in quality circles were
influenced in the areas concerning participation, decision making, and group communication.
Although group communication was influenced, communication through the organization as

47
a whole was not and neither was employee‘s personal responsibility for their work. The
results of this study suggest that quality circles can provide employees with informational and
social support that can help increase their motivation.

2. Increase motivation through employee participation by using open book management.

Open-book management is when a company shares important financial data with employees.
Sharing the information empowers employees by putting trust into them. Employees become
personally and meaningfully involved with the organization beyond just doing their assigned
tasks, which increases their motivation and production Open book management is a four step
process. The first step involves employers sharing financial data with their employees.
Employees need to know how the company, as a whole, is doing financially. Next, employers
must teach their employees how to read and interpret the financial data Employees can look
at all the data a company gives them. However, to understand the data, they must know how
to interpret the numbers. Third, employees have to be empowered to make necessary changes
and decisions for the success of the organization. Employers should treat their employees like
partners. The last step involves employers paying their employees a fair share of profits
through bonuses and incentives. Bonus numbers must be attached to numbers that employees
see regularly and can have an impact on in the financial data. With these steps in mind, the
friction between employees and between employee/management can be drastically reduced.

Four factors must exist for any employee participation program to be successful:

1) Have a profit-sharing or gain-sharing plan where both the employer and employee benefit

2) Implement a long-term employment relationship to install job security

3) Make a concerted effort to build and maintain group cohesiveness

4) Provide protection of the individual employee‘s rights

3.2.1.5 Quality-of-work-life programs

Work-life balance is an employee‘s perception of how a proper balance between personal

time, family care, and work are maintained with minimal conflict. Employers can use work-
life balance as a motivational technique by implementing quality-of-work-life programs.
Examples of such programs include flextime, work place and family support. Flexible work
schedules can allow an employee to work whenever they can as long as a certain amount of
hours are worked each week and some employers allow their employees to work from home.
Sometimes employers utilize flextime schedules that allow employees to arrive to work when

48
they choose within specified limits. A wellness program can involve having an exercise
facility, offering counseling, or even having programs set up to help employees lose weight
or stop smoking cigarettes. Family support programs involve help with parenting, childcare,
and some programs allow employees to leave for family purposes.

One study found that men often identify themselves with their career and work roles while
women often identified themselves with the roles of mother, wife, friend, and daughter. The
Sloan Foundation found that even though women enjoy working as much as men, women
prefer to work nights and weekends if time need to be made up instead of cutting their hours.
A study conducted by the Alliance for Work-Life Progress surveyed employees to find out
the type of workplace flexibility employees say they would like to use in the following year.
Burrus et. al. found that 71 percent of people want an occasional opportunity to adjust their
schedule, 57 percent want to work from a location other than their office, 73 percent want to
make their work-life flexibility arrangement official, and 12 percent want to work less hours.

3.2.2Motivational theories

3.2.2.1 Maslow's hierarchy of needs

Abraham Maslow viewed motivation as being based off a hierarchy of needs, of which a
person cannot move to the next level of needs without satisfying the previous level. Maslow‘s
hierarchy starts at the lowest level of needs, basic physiological needs. Basic physiological
needs include air, water, and food. Employers who pay at least a minimal living wage will
meet these basic employee needs the next level of needs is referred to as safety and security
needs. This level includes needs such as having a place to live and knowing one is safe.
Employers can meet these needs by ensuring employees are safe from physical, verbal or
emotional hazards and have a sense of job security. The third level of needs is social
affiliation and belonging. This is the need to be social, have friends, and feel like one belongs
and is loved. Implementing employee participation programs can help fulfil the need to
belong. Rewards such as acknowledging an employee‘s contributions can also satisfy these
social and love needs. The fourth level on the hierarchy is esteem needs. This level is
described as feeling good about one‘s self and knowing that their life is meaningful, valuable,
and has a purpose. Employers should use the job design technique to create jobs that are
important to and cherished by the employee. The last level Maslow described is called self-
actualization. This level refers to people reaching their potential states of well-being. An

49
employer who ensures that an employee is in the right job and has all other needs met will
help the employee realize this highest need

3.2.2.2 Herzberg's two-factor theory

Frederick Herzberg developed the two-factor theory of motivation based on satisfiers and
dissatisfiers. Satisfiers are motivators associated with job satisfaction while dissatisfiers are
motivators associated with hygiene or maintenance. Satisfiers include achievement,
responsibility, advancement, and recognition. Satisfiers are all intrinsic motivators that are
directly related to rewards attainable from work performance and even the nature of the work
itself. Dissatisfiers are extrinsic motivators based on the work environment, and include a
company‘s policies and administration such as supervision, peers, working conditions, and
salary. Herzberg believed providing for hygiene and maintenance needs could prevent
dissatisfaction but not contribute to satisfaction. Herzberg also believed that satisfiers hold
the greatest potential for increased work performance. Work-life programs are a form of
satisfier that recognizes the employee‘s life outside of work which, in turn, helps motivate the
employee.

3.2.2.3 Vroom's expectancy theory

The expectancy theory of motivation was established by Victor Vroom with the belief that
motivation is based on the expectation of desired outcomes. The theory is based on three
concepts: valence, expectancy, and force. Valence is the attractiveness of potential rewards,
outcomes, or incentives. Expectancy is a person‘s belief that they will or will not be able to
reach the desired outcome. Force is a person‘s motivation to perform. ―In general, people will
work hard when they think that it is likely to lead to desired organizational rewards‖.

3.2.2.4 Locke's goal theory

Edwin A. Locke‘s goal theory describes setting more specific goals to elicit higher
performance and setting more difficult goals to increase effort. He also believed that, through
employee participation in goal setting the employees would be more likely to accept the goals
and have a greater job satisfaction. The goal theory‘s underlying assumption is that
employees who participate in goal setting will set more difficult goals for themselves and
yield superior performance. The theory is logical because employees are going to set more
difficult goals but the goals will be attainable with increased effort. Sometimes organizations
set goals that their employees will rarely, if ever, be able to meet. If the goals are always
unattainable, there is no motivation to try accomplishing them.

50
3.3 Performance Appraisal &Employee Motivation

In the growing age of business and markets, human resource is the big asset of the
organization; if the organization is not keeping well with its labor work force then it might
get into trouble. As the employees are the main features of the progress of the organization.
In order to have productivity, employee should be motivated and should be satisfied with
their job and have loyalty with the organization (EPstein,1992). HR professionals are making
it possible to motivate the employees with the performance appraisal systems by giving them
fair appraisals as per their performance over a period of time. It has been noticed that there is
a strong relationship between performance appraisal and motivation, job satisfaction and
loyalty (bonnie, 2002). Keeping aside the main objectives of performance appraisal, it can be
used as a mechanism to create a completion between employees to get the job done with all
the linked targets and benchmarks (Robert, 1984).

It is also mandatory that employees gets the accurate performance appraisal results to get
motivate, if the feedback of appraisal is according to their performance over the period of
time that will be a great source of motivation to them. Inaccurate performance can create
dissatisfaction from job and ultimately can affect the loyalty with organization. One
employee always expects that evaluator recognize his efforts and achievement in the
professional life and also support him to overcome on his failure and allows the opportunity
to make improvements in his performance in future (bonnie, 2002).

If the performance appraisal has some shortcoming in it and is actually creating some
discrepancy in the process, then it will affect the motivational level of the employees and
ultimately it will affect their efforts and the risk taking ideas for the betterment of the
organization. Also they will lose interest in the affairs of the organization (Robert & Kim,
2007). Plus this de-motivation leads the employees to the lack of loyalty and they will look
other options of good job and hikes in the rewards (bonnie, 2002).

Accurate performance appraisal is always preferable but if there is any inaccuracy then
employees always prefers to have accurate performance appraisal with no hikes in rewards
but not an inaccurate system that never encourages or recognizes their efforts. Employees
who tend to receive accurate performance appraisal over the period of time and also have all
the rewards associated with that appraisal is most motivated employee among all of them and
similarly he tends to be more satisfied with job and more loyal to the organization.

51
 CHAPTER-IV
RESEARCH METHODOLOGY

52
4.1 Research Design Used for the Study

Descriptive research design: It deals with describing the characteristics of a particular

individual, or a group. The design focuses on the following:

a) Formulating the objective of the study

b) Designing the methods of data collection
c) Selecting the sample
d) Collecting the data
e) Processing and analyzing the data
f) Reporting the findings

4.2 Sources of Data Collection

Collection of data is the most important stage in the research process. If any
mistake occurs in the collection of data, it will affect the entire study. Hence care was
exercised in the process of collection of data. The study is descriptive, empirical and
analytical in nature. It is descriptive with regard to the theoretical concepts and regarding the
analysis and interpretation of data collected. Data will be collected both from primary and
secondary.
Two types of data were collected.
1) Primary Data
Primary data are collected with the help of structured and unstructured interview
conducted with the managerial executives and employees of Zen Aspirations Pvt
Ltd with the help of questionnaire.

2) Secondary Data
These are the sources containing data collected and compiled for another
purpose. The secondary data consists of readily available data and statistical
statements and reports that the researcher may use for further studies and
reference. The secondary data was collected from the published sources like data
published in the internet, company records, books and company‘s website.

53
4.3 Sampling Design

Sample design is a definite plan for obtaining sample from a given population.
It refers to the procedure, adopted by a researcher for selecting items for a sample. In this
project random sampling method is used. The respondents are the employees of Zen
Aspirations Pvt Ltd, Trivandrum.

4.3.1 Sample Population

Sample population in the organization is 110.

4.3.2 Sample Size

In this study the sample size is 54 employees.

4.4 Tools Used for Analysis

The research was conducted by using contact instruments like questionnaire, interview
and observation. Questions were prepared accordingly in line with the scaling method. Five
point scales used here are highly agree, agree, neutral, disagree, highly disagree, are used
here.

The data is analyzed through simple percentage method. It is a useful method of

expressing the relative frequency of survey responses and other data. The percentage
frequency distributions are displayed as tables and bar graphs. Another Tool used was SPSS
to find out the role of performance appraisal in employee motivation

4.5 Reference Period

The reference period is the time for which the data is to be collected and
analyzed. The period of the study was 8 weeks..

4.6 Variables
Performance Appraisal as Independent variable
Employee Motivation as Dependent variable

54
 CHAPTER – V
ANALYSIS & INTERPRETATION OF DATA

55
 ANALYSIS & INTERPRETATION OF DATA

Introduction
As the main objective of the project is to find out how much an employee is
getting motivated by the performance appraisal

A Sample size of 54 was selected for analysis and interpretation. The data‘s
from employees were collected through questionnaire. Here Questionnaire is prepared by
finding out the variables of both performance appraisal and employee motivation and
prepared a set of questions under each variable

Demographic details: As the organisation is an IT firm most of the employees are aged
between 25-30 and 80% of the employees are from Trivandrum

Variable analysis: Here the two variables used are Performance appraisal and employee
motivation. Here performance appraisal is the Independent variable and employee motivation
is the dependant variable

Test tools used: Here Questionnaire is prepared by finding out the variables of both
performance appraisal and employee motivation and prepared a set of questions under each
variable. Two types of testing is conducted one is percentage analysis of each variable and
other is regression analysis through SPSS software to analyse how much performance
appraisal contribute to employee motivation

56
Opinion of the respondents about Communication
Table 5.1
Survey Responds Percentage
Highly Agree 43 20.28
Agree 134 63.21
Neutral 30 14.15
Disagree 5 2.36
Highly Disagree 0 0
Grand Total 212 100

Communication
70

60

50

40

30 Communication
20

10

0
Highly Agree Neutral Disagree Highly
Agree Disagree

Interpretation
Mainly four questions are asked 63.21% of the respondents are happy and they strongly
believe that the organization communicates well within the organization and the performance
appraisal techniques and methods are transparent and communicate well within the
organization.
While 2.36% of the respondents disagree or the notable remark of the respondents is that
performance appraisal feedback does not always improves the performance.

57
Opinion of the respondents about Current performance appraisal system
Table5.2
survey Responds percentage
highly agree 41 19.07
agree 128 59.53
neutral 41 19.07
disagree 2 0.93
highly disagree 3 1.4
grand total 215 100

Current perfomance appraisal system

70

60

50

40

30 Current perfomance
appraisal system
20

10

0
highly agree neutral disagree highly
agree disagree

Interpretation
Mainly four questions are asked
On that about 80% of the respondents are happy with the current performance appraisal
system.
But some of the respondents disagree to the point that management did not review the
respondents response and don‘t take actions on the feedback given by the employees.

58
Opinion of the respondents about Organization’s culture

Table 5.3
survey Responds percentage
highly agree 29 18.13
agree 91 56.88
neutral 34 21.25
disagree 5 3.13
highly disagree 1 0.63
grand total 160 100.02

Organisations culture
60

50

40

30
Organisations culture
20

10

0
highly agree neutral disagree highly
agree disagree

Interpretation
Three questions are mainly asked
About 75% of the respondents are happy with the organization‘s culture
But some of the respondents disagree to the question that the organization is not sensitive to
the individual needs arising out of performance appraisal

59
Opinion of the respondents about Team work
Table 5.4
survey Responds percentage
highly agree 9 8.33
agree 53 49.07
neutral 22 20.37
disagree 15 13.89
highly disagree 9 8.33
grand total 108 99.99

Team work
60

50

40

30
Team work
20

10

0
highly agree agree neutral disagree highly
disagree

Interpretation
Mainly two questions are asked
On which they agree to the question that the current performance appraisal system helps to
identify the training needs and they disagree to the question that there is no such external
group or board to review the performance appraisal of employees

60
Opinion of the respondents about Payment
Table 5.5
survey Responds percentage
highly agree 5 4.63
agree 39 36.11
neutral 54 50
disagree 8 7.41
highly disagree 2 1.85
grand total 108 100

Payment
60

50

40

30
Payment
20

10

0
highly agree agree neutral disagree highly
disagree

Interpretation
Mainly two questions are asked to check the influence of payment in employee motivation
39% of the employees agree that they are satisfied with the current pay level and pay level
compared to other companies but many of the employees are in the neutral stand regarding
the current pay level and the pay level comparison

61
Opinion of the respondents about Recognition
Table5.6

survey Responds percentage

highly agree 27 16.67
agree 91 56.17
Neutral 37 22.84
disagree 5 3.09
highly disagree 2 1.23
grand total 162 100

Recognition
60

50

40

30
Recognition
20

10

0
highly agree agree Neutral disagree highly
disagree

Interpretation
3 questions are asked regarding the influence of recognition in employee motivation on
which about 71% of the employees agree that recognition is a key to get motivate them but
some employees disagree that they did not get recognition according to their hard work

62
Opinion of the respondents about Fundamental needs
Table 5.7
survey Responds percentage
highly agree 30 18.99
agree 85 53.8
neutral 41 25.95
disagree 2 1.27
highly disagree 0 0
grand total 158 100.01

Fundamental Needs
60

50

40

30
Fundamental Needs
20

10

0
highly agree neutral disagree highly
agree disagree

Interpretation
Mainly 3 questions are asked and almost 72% of the employees agree that there fundamental
needs are considered well and another 26 % of the employees take the neutral stand and some
of the employees feel that the benefits offered in organization is not satisfactory.

63
Opinion of the respondents about Personal growth
Table5.8

survey Responds percentage

highly agree 37 11.6
agree 184 57.68
neutral 78 24.45
disagree 16 5.02
highly disagree 4 1.25
grand total 319 100

Personal Growth
70
60
50
40
30 Personal Growth
20
10
0
highly agree neutral disagree highly
agree disagree

Interpretation
6 questions are asked to check the influence of personal growth in the employee motivation
About 69% of employees agree that the organization help to grow and there promotions are
based on performance and also the performance appraisal helps to identify the strengths and
weakness of the employees but another 6% of the employees disagree to the point that the
performance appraisal did not have any impact on personal and professional mile stones

64
Opinion of the respondents about Career development
Table 5.9
survey Responds percentage
highly agree 24 14.81
agree 104 64.2
neutral 32 19.75
disagree 2 1.23
highly disagree 0 0
grand total 162 99.99

Career Development
70
60
50
40
30 Career Development
20
10
0
highly agree neutral disagree highly
agree disagree

Interpretation
As various questions asked to find out whether performance appraisal has any role in
employee motivation we can find career development as one variable and after asking various
questions regarding the career development about 78% of the employees tell that through
good performance appraisal it helps them to develop their career and thus they are motivated.
They also tells that their current job helps to do the best of their abilities and they can able to
perform well and so that they can grew their career and also career development opportunities
are available in the organization.

65
Opinion of the respondents about Training & Development
Table 5.10
survey Responds percentage
highly agree 15 9.32
agree 81 50.31
neutral 61 37.89
disagree 4 2.48
highly disagree 0 0
grand total 161 100

Training & Development

60

50

40

30
Training & Development
20

10

0
highly agree neutral disagree highly
agree disagree

Interpretation
As various questions asked to find out whether performance appraisal has any role in
employee motivation we can find Training & Development as a variable and here majority of
the employees agree that the training need analysis system is satisfactory and many
employees took a neutral stand for the question Is training a priority for promotion.so it is
better to give training for their promotion so that the employee can perform better within the
job and also better training motivates the employee too.

66
Opinion of the respondents about Participation & Feedback
Table 5.11
survey Responds percentage
highly agree 64 13.22
agree 250 51.65
neutral 141 29.13
disagree 20 4.13
highly disagree 9 1.86
grand total 484 99.99

Participation & Feed Back

60

50

40

30
Participation & Feed Back
20

10

0
highly agree neutral disagree highly
agree disagree

Interpretation
As various questions asked to find out whether performance appraisal has any role in
employee motivation we can find that participation and feedback as another variable and after
asking various questions regarding participation and feedback
About 65% of the employees agree that employees participation are encouraged by the
organization and also the management take employees suggestions seriously and they will get
feedback regarding their performance and those feedback affects their performance
positively. And they strongly agree that performance appraisal plays an important role in the
organization.

67
The employees strongly disagree to the point that the performance appraisal system is not
connected to any incentive system and they disagree to the point that financial incentives
motivates them more than non-financial incentives they responds that they give importance to
both.

Correlation
Hypothesis

H0: There is no relation between performance appraisal and employee motivation

H1: There is a relation between performance appraisal and employee motivation

Descriptive Statistics
Mean Std. N
Deviation
Motivation 2.31 .412 53
Performance
2.18 .386 53
appraisal

The mean value of employee motivation is 2.31 with standard deviation of .412.The mean
value of performance appraisal is 2.18 with a standard deviation of .386

68
 Correlations
motivatio Performance
n appraisal
Pearson
1 .693**
Correlation
Motivation
Sig. (2-tailed) .000
N 53 53
Pearson
.693** 1
Performance Correlation
appraisal Sig. (2-tailed) .000
N 53 53
**. Correlation is significant at the 0.01 level (2-tailed).

When correlation is done the value got is .693, between

performance appraisal and employee motivation, where the ideal value of R should be
between 0 and 1 and the value we got is .693 we can say that performance appraisal is
positively correlated to employee motivation
Thus the hypothesis stands true and performance appraisal is also an element that contributes
employee motivation. And also the above table shows that 53 % of positive correlation with
employee motivation. So the alternate hypothesis is accepted

Regression

After the base percentage evaluation a SPSS evaluation is done to find out the Role of
performance appraisal in employee motivation or how much is performance appraisals role in
motivating an employee for that regression analysis is done

69
 Variables Entered/Removeda
Mode Variables Variables Method
l Entered Removed
2.153846153
1 . Enter
8461537b
a. Dependent Variable: 2.0833333333333335
b. All requested variables entered.

Model Summaryb
Model R R Adjusted Std. Change Statistics Durbin-
Square R Error of R F df1 df2 Sig. F Watson
Square the Square Change Change
Estimate Change

1 .693a .480 .470 .300 .480 47.143 1 51 .000 1.652

a. Predictors: (Constant), 2.1538461538461537
b. Dependent Variable: 2.0833333333333335

While doing regression analysis here the R square value must be between 0 and .5 and the
value that get is .480 so we can say that the variables are perfectly matching and the
performance appraisal has great connection with employee motivation or else performance
appraisal can be termed as one of the factor that contributes employee motivation

70
 CHAPTER-VI
FINDINGS, SUGGESTIONS AND
CONCLUSION

71
FINDINGS

1) Equipped with the latest facilities, the company is backed by high profile, highly
skilled manpower with an impressive track record
2) The variables that influence performance appraisal are communication, Current
Performance appraisal system, Organizations culture, Teamwork
3) The variables that influences employee motivation are Payment, Recognition,
Fundamental needs, Personal growth
4) The variables that interlink performance appraisal and employee motivation are
Career development, Training and development, Participation and feedback
5) The organization communicates well within the employees and the performance
appraisal techniques and methods are transparent and communicate well within the
organization.
6) Employees are happy with the current performance appraisal system.
7) The current performance appraisal system helps to identify the training needs.
8) There is no external group or board to review the performance appraisal of employees
9) The organization help to grow and there promotions are based on performance and
also the performance appraisal helps to identify the strengths and weakness of the
employees
10) The organization and also the management take employees suggestions seriously
11) While doing regression analysis here the R square value must be between 0 and .5 and
the value that get is .480 so we can say that the variables are perfectly matching and
the performance appraisal has great connection with employee motivation or else
performance appraisal can be termed as one of the factor that contributes employee
motivation
12) The Employee Relations scenario in the company has been peaceful, healthy and
cordial.
13) The Company has well developed internal control system.
14) Zen Aspirations have a formal Performance Appraisal System.
15) Employees are of the opinion that the basic objective of Performance Appraisal has a
role on employee motivation
16) Most of the employees are satisfied with the current Performance Appraisal system.
17) Self-appraisal system aids the employees to identify their areas of improvement.
18) Self-appraisal system enables the employees to assess their own job performance.

72
SUGGESTIONS

1) The organization should build up open communication through Performance Review

Discussion which can enhance organizational effectiveness.
2) Both Quantity and Quality of work should be given equal importance.
3) Employees should be involved in decision making process.
4) The organization must give more career development opportunities so that it will
motivates the employee more
5) The appraisal system should help the employees to identify the training needs.
6) Proper training program should be implemented based on the appraisal system.
7) It is important to find out the rest of the elements that influence employee motivation

73
CONCLUSION
The project was done with a certain objective in mind and the main aim of the
same was to gather information regarding the Role of performance appraisal in employee
motivation and in every organization performance appraisal play a good role in employees
gets motivated and it is a very important part as the success of any organization. Therefore, it
is concluded that in order to achieve higher targets and productivity a well-planned appraisal
system should be continuously prepared so that the employees working with the organization
could be updated from time to time.
While doing regression analysis here the R square value
must be between 0 and .5 and the value that get is .480 so we can say that the variables are
perfectly matching and the performance appraisal has great connection with employee
motivation or else performance appraisal can be termed as one of the factor that contributes
employee motivation

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BIBLIOGRAPHY
1. Kothari C.R, Research Methodology, 7th Reprint, 1994, Prentice Hall of India Private
Ltd., New Delhi.
2. C.R.Kothari, Research Methodology, 8th Edition, Wishva Prakashan, New Delhi,
2001.
3. C.B.Gupta Personal Management, III Edition, Sultan Chand & Sons Publications,
New Delhi, 2000.
4. Human Resource Management - William. P. Antony, Michele Kumar, Pamela.L,
Perreve, 4th Edition, 2002, Harcourt College Publishers.
5. Human Resource Management and Personal Management- Williams.BS, Keith Davis,
4th Edition 20044, McGraw Hill International.
6. Human Resource Management- Shashi K Gupta, Rosy Joshi, 3rd Edition 2009,
Kalyani Publishers.
7. Management and Organizational Behaviour- Laurie J. Mullins, 7th Edition 2005,
Pitman Publishing.
8. TI 2012-034/1
Tinbergen Institute Discussion Paper
The Role of Performance Appraisals in Motivating Employees
Jurjen J.A. Kamphorst
Otto H. Swank
Erasmus

9. International Journal of Business Trends and Technology- volume2Issue4- 2012

ISSN: 2249-0183 http://www.internationaljournalssrg.org Page 29

Impact of Employee Motivation on Performance (Productivity) In

Private Organization
1Nupur Chaudhary, 2Dr. Bharti Sharma,
1Research Scholar, Suresh Gyan Vihar University, Jaipur,
2Associate Professor, St. Wilfred. College, Jaipur,

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 10. International Journal of Academic Research in Business and Social Sciences
December 2012, Vol. 2, No. 12 ISSN: 2222-6990

The Effect of Employees‘ Performance Appraisal Procedure on their Intrinsic

Motivation
Shaemi Barzoki Ali
PhD of Business Administration and academic member at University of Esfahan, Iran
Abzari Mahdi
PhD of Business Administration and academic member at University of Esfahan, Iran
Javani Malihe
Master of Business Administration, University of Esfahan, Iran

11. The International Journal of Human Resource Management

Can performance appraisals motivate employees to improve performance? A

Mexican study
T. T. Selvarajan a & Peggy A. Cloninger a
a School of Business, University of Houston-Victoria, Sugar Land,
TX, USA

WEBLIOGRAPHY
www.zenaspirations.com
www.wikipedia.org

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APPENDIX
Sir/ Madam,
I, Jithin J Kumar fourth semester MBA student of FISAT Angamaly, under MG University,
as part of the requirement of MBA programme I have to take up a project study about the
topic ―Role Of Performance Appraisal In Employee Motivation‖. A free and fair expression
of your opinion is needed for my project work. I assure that most secrecy will be maintained
and the data collected will be used solely for my research work.
Questionnaire

1) Name:

2) Gender
a) Male b) Female

Questions
Set A regarding performance appraisal
Communication
1. I always receive adequate feedback about my performance?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
2. The methods used to measure my performance are transparent?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
3. Performance appraisal feedback improves the performance?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
4. The employer communicates well with all the employees in the organization?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
Current performance appraisal system
5. I am happy with the current performance appraisal method?

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 (a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree

6. Are the Performance appraisal done periodically?

(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
7. I think that the management reviews my response?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
8. Management takes any action on my feedback and responses?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree

Organization’s culture

9. I always believe that Performance appraisal plays an important role in an

organization's success?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
10. The company should highlight the personal and professional milestones. Does u agree?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
11. Is the organization sensitive to your individual needs arising out of Performance
appraisal?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
Team work
12. Are there any other boards or groups of people to review the Performance appraisal?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
13. The current appraisal system helps you to identify the training needs?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
Set B regarding motivation

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 Payment
14. I am satisfied with the current pay level compared to other companies in the industry?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
15. I believe that the company pays accordingly to the amount of work?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
Recognition
16. Performance appraisal has a relation with employee recognition?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
17. I am being treated appropriately for my performance?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
18. I agree that I will get recognition according to my hard work?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
Fundamental needs
19. I believe that performance appraisal have a connection with Motivation?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
20. I am agreeing that the benefit offered in our company is satisfactory?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
Personal growth
21. I always agree that performance appraisal a criterion to get promotions?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
22. I agree that Performance appraisal has a impact on personal and professional skills?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree

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23. Do you think that transfer depends on your Performance appraisal?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
24. I always agree that Performance appraisal identifies strengths and weaknesses of
employees?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
25. I always believe that employees can be motivated through fair Performance appraisal?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
Set C variables that interlink performance appraisal and employee motivation
Career Development
26. I believe that my job makes good use of your abilities?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
27. Did the organization help you to develop yourself and your career?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
28. I strongly believe that career development opportunities are available in the
organization?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
Training &Development
29. Is the training need analysis system satisfactory in your Organization?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
30. Is training a priority at your company for promotion?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
31. Is the training adequate for the self-development support?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
Participation & feed back
32. I always agree that the management take employees suggestions seriously?

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 (a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
33. Does the management seek the involvement of employees when making important
decisions?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
34. I strongly believe that performance appraisal system in the organization linked to
incentive or reward system?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
35. Do you think that Performance appraisal influences positively to an individual‘s
performance?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
36. Do you think that the salary increments given to employees who do their jobs very
well motivates them?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree
37. Financial incentives motivates me more than non-financial incentives. Do you agree?
(a) Highly agree (b) Agree (c) Neutral
(d) Disagree (e) highly disagree

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