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PERFORMANCE MANAGEMENT

Impact of performance appraisal system on productivity of Employees of ONGC Ltd.

INDEX
ACHNOWLEDGEMENT EXECUTIVE SUMMARY INTRODUCTION TO THE INDUSTRY. OBJECTIVE. MAJOR PLAYER OF PETROLIUM INDUSTRY. GLOBAL RANKING. PERFORMANCE APPRAISAL.METHODS. PERFORMANCE APPRAISAL SYSTEM ON ONGC. RESEARCH METHODOLOGY. SIGNIFICANCE OF STUDY. DATA ANALYSI. LIMITATION. INTERPERTATION. FINDINGS RECOMMENDATION. QUESTIONNAIRE. BIBLIOGRAPHY

EXECUTIVE SUMMARY Oil and Natural Gas Corporation Limited(ONGC) is engaged in the business of exploration anddrilling of crude oil and natural gas and is the worlds second biggest exploration and productioncompany ONGC owns and operates more than 11000 kilometers of pipelines in India, including nearly 3200 kilometers of sub-sea pipelines. The company contributes more than 78% of Indiasoil and gas production.Today, ONGC is the flagship company of India; and making this possible is a dedicated team of nearly 40,000 professionals who toil round the clock. It is this toil which amply reflects in the performance figures and aspirations of ONGC. The company has adapted progressive policies inscientific planning, acquisition, utilization, training and motivation of the team. At ONGC everybody matters, every soul counts. ONGC has a unique distinction of being a company with in-house service capabilities in all the activity areas of exploration and production of oil & gas and related oil field services. Needless to emphasize, this was made possible by the men & women behind the machine. Over 18,000 experienced and technically competent executives mostly scientists and engineers from distinguished Universities / Institutions of India and abroad form the core of our manpower.They include geologists, geophysicists, geochemists, drilling engineers, reservoir engineers, petroleum engineers, production engineers, engineering & technical service providers, financial and human resource experts, IT professionals and so on.This report concentrates on the study of the performance appraisal system being practiced in ONGC and to check its effectiveness and further to suggest and recommend any possible ways to improve and strengthen its PMS.

INTRODUCTION TO THE INDUSTRY The India Petroleum Industry is a case in point for exhibiting the giant leaps India has takenafter its independence towards its march to attain a self-reliant economy. During the Independence era of 1947, the India Petroleum Industry was controlled by foreign companies and Indias own expertise in this sector was limited. Now, after 60 years, the India Petroleum Industry has become an important public sector undertaking with numerous skilled personnel and updated technology that is comparable to the best in the world. The vim and the achievement during these years is the growth of productivity in petroleum and petroleumbased products. Even the consumption has multiplied itself nearly 30 times in the postindependence era. An important advancement in the petroleum industry came with the Industrial Policy Resolution,1956 which signified the promotion of growth of industries. The ONGC originally set up as a Directorate in 1955, was transformed into a Commission in 1956. In 1958, the Indian Refineries Ltd., a government undertaking, came into existence. The Indian Oil Company (IOC), also a government undertaking, was set up in 1959 with the purpose of marketing petroleum-related products. Indian Oil Corporation Ltd. was formed in 1964 with the merger of the Indian Refineries Ltd. and the Indian Oil Company Ltd. Presently, 17 refineries operate under the India Petroleum Industry.

OBJECTIVE To know the various types of performance appraisal methods being used at ONGC Ltd. To know which appraisal system is being mostly used in ONGC Ltd. To know whether the performance appraisal system of ONGC Ltd. Increase the productivity of employees or not

MAJOR PLAYERS IN PETROLEUM Indian Oil corporation ONGC Reliance Industries NTPC Hindustan Petroleum Bharat Petroleum TCS Infosys Technologies Wipro SAIL

OVERVIEW OF ONGC LTD. Born as a modest corporate entity within serene Himalayan settings on 14 Th August 1956 as Commission, Oil and Natural Gas Corporation Limited (ONGC), has grown into a full fledge dorizontally integrated upstream petroleum company. Today, ONGC is a flagship public sector enterprise and Indias highest profit making corporate, which has achieved the landmark since inception, ONGC has produced more than 600 million metric tones of crude oil and supplied more than 200 billion cubic meters of gas, thus fuelling Indias economy. GLOBAL RANKING ONGC ranks as the Numero Uno Oil & Gas Exploration & Production (E&P) Companyin Asia, as per Platts 250 Global Energy Companies List for the year 2007. ONGC ranks 23rd Leading Global Energy Major amongst the Top 250 Energy Majorsof the World in the Platts List based on outstanding performance in respect of Assets,Revenues, Profits and Return on Invested Capital (RIOC) for the year 2007. ONGC is the only Company from India in the Fortune Magazines list of the WorldsMost Admired Companies 2007. ONGC is 9th position in the Industry of Mining, crudeoil production.

ONGC VISION To be a world class Oil and Gas Company integrated in energy business with dominant Indian leadership and Global presence. ONGC MISSION Dedicated to excellence by leveraging competitive advantages in R&D and technologywith involved people. Imbibe high standards of business ethics and organizational values. Abiding commitment to safety, health and environment to enrich quality of communitylife. Foster a culture of Trust, openness and mutual concern to make a stimulating andchallenging experience for our people. Strive for customer delight through quality products and services

HR VISION "To attain organizational excellence by developing and inspiring the true potential of companyshuman capital and providing opportunities for growth, well being and enrichment". HR MISSION "To create a value and knowledge based organization by inculcating a culture of learning,innovation & team working and aligning business priorities with aspiration of employees leadingto development of an empowered, responsive and competent human capital". HR OBJECTIVES To develop and sustain core values To develop business leaders for tomorrow To provide job contentment through empowerment, accountability and responsibility To build and upgrade competencies through virtual learning, opportunities for growthand providing challenges in the job To foster a climate of creativity, innovation and enthusiasm To enhance the quality of life of employees and their family To inculcate high understanding of 'Service' to a greater cause

PERFORMANCE APPRAISAL Performance appraisal can be defined as the process of evaluating the performance of anemployee & communicating the result of the evaluation to him for the purpose of rewarding &developing the employee. According to Michael Armstrong Performance appraisal is a formalassessment & rating of individual by their managers at usually at annual review meeting.Performance can be defined as the degree of accomplishment of tasks by an employee in his job.In some organizations it is measure of the result achieved & target accomplished whereas inothers, it is a measure of employee efforts & behavior. However most organizations use acombination of both efforts & results. Performance appraisal is also termed as performancereview, annual review & annual appraisal. THE APPRAISAL PROCESS 1.The first step in the appraisal performance process is the determination of standard of performance based on the organizational objectives & job descriptions. 2.The next step of performance appraisal is performanceagainst the pre-determined goal & standards. the measurement of employees

3.The next step is the actual process of measurement. Performance appraisal has to be acontinuous process & feedback should be given to the employee at regular intervals. 4.The next step is the very critical step & involves communicating the result of the appraisal to the employee concerned. 5.Once appraisal is finalized after discussing it with the employees, it have to be puteffective use. THE APPRAISER The appraiser is that person who access the performance of a person or an employee. In morerecent concept like 360 degree feedback, the peer/colleagues of the employee, his supplier, hiscustomer, & even his subordinate play a role in assessing his performance. SELF-APPRAISAL As has been discussed earlier self appraisal is the common practice today, with the employee being given a role in evaluating their own performance. The employee himself is best equippedto evaluate his performance because he understands his strengths & weaknesses the best.

SUPERVISOR It is the responsibility of the supervisor to ensure that his subordinate perform their jobs well.Hence the authority to evaluate the employees performance has traditionally been with thesupervisor .PEERS Peer evaluation is very sensitive area as it may lead to false & unhealthy appraisal because of competition among peers. The organization has to reach an advanced stage of development before it can handle peer appraisal.CUSTOMERSThe performance of an employee has a direct & immediate impact on his customer either internal or external. In service organization like banks & hotels customer feedback has becomethe most important tool in evaluating the employees performance . SUBORDINATES The concept of subordinate evaluating the performance of his supervisor yet to gain acceptancein most Indian companies. The Indian culture does not encourage the idea of subordinateappraisal. PERFORMANCE APPRAISAL METHODS 1.Management by objective or goal setting. 2.Graphic rating scale. 3.Work standard approach. 4.Essay appraisal. 5.Critical incidence method. 6.Forced choice rating method. 7.Point allocation method. 8.Ranking method. 9.Check list. 10.Behavioral anchored rating scale.(BARS) 11.360 degree performance appraisal. 12.Team appraisal. 13.Balanced scorecard method.MANAGEMENT BY OBJECTIVE (MBO)The main aspect of MBO is clear & well defined goals, a definite time span to achieve the goals,action plan &

finally, timely & constructive feedback. It is also called a goal setting approach;MBO is more commonly used for managers & professionals.GRAPHIC RATING SCALEThis method of appraisal requires the rater to rate the employee on factors like quantity &quality of work, job knowledge, dependability, punctuality, attendance etc. This method is alsoused for performance appraisal of employees. They check their employees daily by using thismethod.

WORK STANDARD APPROACH This method of appraisal is more suitable in a manufacturing scenario, where the goals are predetermined work standard. These work standards can be set based on the average output of atypical employee in the organization or by bench marking against the work standard of acompetitor in a similar business. ESSAY APPRAISAL In the essay appraisal method, the appraiser prepares a document describing the performance of the employees. Questions or guidelines are provider to the appraiser based on which analyses &describes the employees performance. CRITICAL INCIDENT METHOD In this method of performance appraisal, the appraiser makes a note of all the critical incident that reflect the performance & behavior of the employee during the appraisal period. These arerecoded as & when they occur & can demonstrate either positive or negative traits or pero rmance.

FORCED CHOICE RATING METHOD In this method the appraiser is required to assign ranks to different attributes are all seemingly positive, but have different weights which are unknown to the appraiser. Once the employeesattributes are ranked the human resource department applies the weights & arrives at a scorewhich is the final appraisal score. POINT ALLOCATION MATHOD In this method of appraisal, the appraiser has to allocate points to different members in his team.He has at disposal , a specific number of points which he has to distribute among his teammembers, based on their performance during the appraisal period. RANKINNG METHOD There are three commonly used methods of ranking namely alternation, paired comparison &forced distribution. The first two methods are used when there are only a few employees to beranked, whereas forced distribution method is used in large companies which have thousands of employees

.CHECKLIST In this method the rater has to respond yes or no to a set of questions which assess theemployees performance & behavior. Normally weights are attached to each of these questions based on which the final appraisal score of the employee is calculated. BEHAVIOR ANCHORED RATING SYSTEM (BARS)BARS concentrates on the behavioral traits demonstrated by the employees instead of his actual performance. Some of the other methods like graphic rating scale & checklist also measure the behavior based on the assumption that desirable behavior result in effective performance. 360 DEGREE PERFORMANCE APPRAISALSA 360 degree appraisal system aims at a comprehensive & objective appraisal of employee performance. In a 360 degree appraisal system the employees performances evaluated by supervisor, his peers, his internal external customers, his internal external suppliers & hissubo rdinates. This system reduces the subjectivity of a traditional supervisor appraisal. TEAM APPRAISAL In the new economy era, where team work is essential for any venture to succeed, team appraisalhas emerged as one of the best tool for the performance management. In the team appraisalmethod the individual team member evaluate their colleagues in the team & provide feedback. BALANCED SCORECARD The balanced scorecard as a method of measuring performance channelizes the efforts of peopleto achieve organizational goals. The implementation of balanced scorecard involve formulating a strategy & deciding what each employee needs to do to achieve the objectives based onstrategy.

CHALLENGES IN DIFFERENT METHODOILOGY OF PERFORMANCE APPRAISAL Designing an appraisal program poses several questions, which need answers. They are: Whose performance is to be assessed? Who are the appraisers? What should be evaluated? When to appraise? What problems are encountered?

How to solve the problems? What methods of appraisal are to be used? Whose performance should be assessed? The answer is obvious employees. When we say employees, it is individual or teams? Specifically, the appraisee may be defined as the individual, work group, division ororganization.Who are the appraisers? Appraisers can be immediate superiors, specialists from the human resource department,subordinates, peers, committees, clients, self-appraisals or a combination thereof.What should be evaluated? One of the steps in designing an appraisal program is to determine the evaluation criteria. It isobvious that the criteria should be related to the job. The criteria for assessing performancecan be:Quality & QuantityTimelinessCost EffectivenessNeed for supervisionInterpersonal impactInnovation & CreativityProblem AnalysisCustomer orientationMarket OrientationEntrepreneurial DriveNegotiation skills etc.This is not an exhaustive list, but several other parameters too can be added depending on jobrequirements and organizational needs.When to appraise/rate? The most frequent rating schedules are semi-annual and annual. New employees are ratedmore frequently than older ones. Some practices call for ratings:Annually as per company practiceAfter first 6 months of employment Sizeable increase in production and productivity: - when motivated properly, people try to putefforts produce more, thus increasing their efficiency and as a result of this general productionand productivity of the organization increases. They (motivated employees) use the methods,system and technology effectively in the best interest of the organization.Basis of Cooperation: - In a zeal to produce more the member's work 'an s a team to pull theweight effectively, to get their loyalty to the group and the organization, to carry out properly theactivities allocated and generally to play an efficient part in achieving the purpose which theorganization has undertaken'. Thus, motivation is a basis of cooperation to get, the best result outof the efforts of the human beings on the job.Improvement upon skill and knowledge:- all the members will try to be efficient as possible andwill try it improve upon the skill and knowledge to the progress of the organization which, inturn will provide the promised and more, ultimately enabling them to satisfy their needs -personal and social both.Acceptance of organizational change: - change is the law of nature. Due to several changes in thesociety, changes in technology, value system, etc. organization has to incorporate these changesto cope with the requirement of the time. If people are effectively motivated, they gladly accept,introduce and implement these changes without reserving any resistance to change and negativeattitude, thus keeping the organization on the right track of progress.Better Image: - a firm that provides opportunities for the advancement of its people

has a betterimage in the minds of the public as a good employer. This, image helps in attracting qualifiedpersonnel and thus simplifies the staffing function. This will also improve employee satisfactionand reduce industrial stifle.In a nutshell, to achieve the organizational and individual goals in an economical and efficientmanner, motivation is an important tool in the hands of management to direct the behavior of subordinates in the desired and appropriate direction and thus minimize the wastage of humanand other resourcesMotivation is a very important for an organization because of the following benefits it provides:-Puts human resources into actionEvery concern requires physical, financial and human resources to accomplish the goals. It isthrough motivation that the human resources can be utilized by making full use of it. This can bedone by building willingness in employees to work. This will help the enterprise in securing bestpossible utilization of resources.Improves level of efficiency of employees The level of a subordinate or a employee does not only depend upon his qualifications andabilities. For getting best of his work performance, the gap between ability and willingness has tobe filled which helps in improving the level of performance of subordinates. This will result into-Increase in productivity,Reducing cost of operations, andImproving overall efficiency.Leads to achievement of organizational goalsThe goals of an enterprise can be achieved only when the following factors take place :-There is best possible utilization of resources,There is a co-operative work environment,The employees are goaldirected and they act in a purposive manner,Goals can be achieved if co-ordination and cooperation takes place simultaneously which can beeffectively done through motivation.Builds friendly relationshipMotivation is an important factor which brings employees satisfaction. This can be done bykeeping into mind and framing an incentive plan for the benefit of the employees. This couldinitiate the following things:Monetary and non-monetary incentives,Promotion opportunities for employees,Disincentives for inefficient employees.In order to build a cordial, friendly atmosphere in a concern, the above steps should be taken by amanager. This would help in:Effective co-operation which brings stability,Industrial dispute and unrest in employees will reduce,The employees will be adaptable to the changes and there will be no resistance to the change,This will help in providing a smooth and sound concern in which individual interests willcoincide with the organizational interests,This will result in profit maximization through increased productivity.Leads to stability of work forceStability of workforce is very important from the point of view of reputation and goodwill of aconcern. The employees can remain loyal to the enterprise only when they have a feeling of participation in the management. The skills and efficiency of employees will always be of advantage to employees as well as employees. This will lead to a good public image in themarket which will attract competent and qualified people into a concern. As it is said, Old isgold which suffices with the role of motivation here, the older the people, more the experience and their adjustment into a concern which can be of benefit to the enterprise.From the above discussion, we can say that motivation is an internal feeling which can beunderstood only by manager since he is in close contact with the employees. Needs, wants anddesires are interrelated and they are the driving force to act. These needs can be understood bythe manager

and he can frame motivation plans accordingly. We can say that motivation therefore is a continuous process since motivation process is based on needs which are unlimited.The process has to be continued throughout.We can summarize by saying that motivation is important both to an individual and abusiness. Motivation is important to an individual as:Motivation will help him achieve his personal goals.If an individual is motivated, he will have job satisfaction.Motivation will help in selfdevelopment of individual.An individual would always gain by working with a dynamic team.Similarly,motivation is important to a business as:The more motivated the employees are, the more empowered the team is.The more is the team work and individual employee contribution, more profitable and successfulis the business.During period of amendments, there will be more adaptability and creativity.Motivation will lead to an optimistic and challenging attitude at work placeMOTIVATIONAL FACTORSThere are several factors that motivate a person to work. The motivational factors can bebroadly divided into two groups:I. MONETARY FACTORS: Salaries or wages: Salaries or wages is one of the most important motivationalfactors. Reasonable salaries must be paid on time. While fixingsalaries the organization must consider such as : Cost of living Company ability to pay Capability of company to pay etc, Bonus:It refers to extra payment to employee over and above salary given as an incentive. The employees must be given adequate rate of bonus. Incentives:The organization may also provide additional medicalallowance, educational allowance, hra ,allowance, etc. incentives such as

Special individual incentives:The company may provide special individual incentives. Such incentivesare to be given to deserving employees for giving valuable suggestions.II. NON MONETARY FACTORS: Status or job title: By providing a higher status or designations the employee must be motivated. Employees prefer and proud of higher designations. the people, and without the people, the organization has no one to do the work. So why has HRnot been able to capitalize on this strength? We were able to identify two reasons.First, HR has not historically had the statistics or data that can excite management and show howHRM influences agency success. Second, HR has focused on internal operations rather thanactivities that impact the entire agency. These facts are recognized by the Strategic HumanResources Roundtable, an OPM-sponsored working group of Government wide HR

Directors that meets periodically to discuss HRs role in GPRA. This group acknowledges that to address these shortcomings, HR needs to ask itself what are the HRM concerns that will gain managements attention, and does HR have the data that can help address those concerns? SSA has done this, as is demonstrated in the above inset. The HR Office and Line Management es, the recognition that its people are its most important asset has Now that we have explored the relationship between HR executives and top agency managers, we need to look at how the HR office interacts with its line managers and if there has been any movement toward a more cooperative, consultative relationship. HRs role is changing, but is HR changing with it? As discussed earlier, NPR advocated HR delegating,downsizing, and outsourcing so that it could start concentrating on broader organizational issues rather than transactional processes. As we have seen, this is beginning to occur at the corporate level, but what about the line level? The problem is that delegation to managers has not taken hold very quickly, but HR offices have already been downsized. Therefore, HR is still expected to do the transactional work it did before, while also focusing on broader organizational issues, and doing all of this with an average of 20 percent less staff. It is not hard to understand why agency HR offices are struggling to 5 redefine their role to strategic partner. Just how far have they gotten?HR as Consultant:Most agency managers we interviewed acknowledge that their HR office has become more consultative. Rather than telling a manager he/she can or cannot do something, HR professionals are more helpful in finding solutions to HR issues.HR as Contributor to Mission Accomplishment:These same managers also recognize the importance of the HR office to mission accomplishment. There is so much that HR does for managers in terms of recruitment and staffing, employee development, and employee relations that managers would have difficulty doing it on their own. However, HR does have its limitations, particularly the size of the staff in relation to the amount of work it has to do, its knowledge of the mission, and skill gaps resulting from downsizing.HR as Strategic Partner:Few, if any, agency managers feel that their HR office is a true strategic partner. Few HR officesare included in business planning from the beginning, generally being brought in to implement adecision that has already been made. For HR to become more involved in line-level decision-making, managers would like the office to: C have greater knowledge of the organizational mission, and C get more involved and innovative in broad, organizational HR issues thatimpactmost on the organization, such as recruitment and workforce and succession planning.HR has made some headway, as demonstrated in the following NASA example, but clearly hassome distance to go in being involved in line management decisionmaking. Now lets look at the other side of the coin -- how managers are involved in making decisions about HR programs.Most line HR offices involve managers at least at an informal level, generally through satisfaction surveys or informal discussions. A few have HR/management councils that get together periodically to discuss human resources issues. This is as close as agencies get to realintegration of managers into the HR program decisionmaking process. Generally, managers donot feel that they have a large impact on the direction of HR programs and therefore feel little ownership for them. Accountability With the

developing relationship between HR and management, both at the top and line levels,along with NPR and GPRA mandates, accountability should become a shared responsibility.Managers are making more and more HRM decisions while the HR staff is becoming more involved in broader organizational issues. This means that both the HR staff and managers are ultimately accountable for effective, legally compliant HRM. Is this shared accountability occurring in Federal agencies? Approximately half of the responding agencies agree that HRM accountability is shared between the HR staff and managers. Managers are accountable for the business results achieved through good human resources management, the HR staff is accountable for HR compliance, and both are accountable for the over all effectiveness of the agency HRM program. However, the other half still feels that the ultimate accountability falls on the HR staff. They are the ones responsible if actions are found noncompliant, and little attention is given to whether managers HRM decisions are an effective use of resources. OPMs HRM Accountability System Development Guide goes into quite a bit of detail on shared accountability and can assist agencies in understanding the concept, determining who is accountable for what, and devising strategies for how to hold them accountable. Employee WelfareDefinitions of Employee Welfare Employee Welfare means anything done for the comfort and improvement, intellectual andsocial of employee or and above the wages paid which is not a necessary for the industry.Employee or labour welfare is a comprehensive term including various services, benefitsand facilities offered to employees by the employer. Through such generous fringe benefitsthe employer makes life worth living for employees. The welfare amenities are extended inaddition to normal wages and other economic rewards available to employees as per the legal provisions. According to Dr. Parandikar, Labour welfare work is work for improving the health, safety and general well being and the industrial efficiency of the workers beyond the minimum standard laid down by labour legislation Welfare measures may also be provided by the government, trade unions and non-government agencies in addition theemployer. The basic purpose of labour welfare is to enrich the life of employees and keepthem happy and contented. Welfare measures may be both statutory and voluntary. Labourlaws require the employer to extend certain benefits to employees in addition to wages. Voluntary benefits are the result of employers generosity, enlightenment and philanthropic feelings.

MEANING OF EMPLOYEE WELFARE

According to the Oxford dictionary employee welfare or labour welfare means the effortsto make life worth living for workmen. According to the Labour Investigation Committee (1946), employee welfare means anything done for intellection physical, moral and economic betterment of the workers, whether by employers, by Government or by other agencies, over and above what is laiddown by law, or what is normally expected on the part of the contracted benefits for which workers may have bargained.

FEATURES OF EMPLOYEE WELFARE => Employee welfare is a comprehensive term including various services, facilities andamenities provided to employees for their betterment. => Employee welfare is a dynamic concept varying from country to country and fromregion to region within the same country. It is a flexible and ever changing concept as newwelfare measures are added to the existing measures from time to time. => Welfare measures are in addition to regular wages and other economic benefitsavailable to employees under legal provisions and collective bargaining .=> Welfare measures may be provided not only by employers but by the government, tradeunions and other agencies too. => The basic purpose of employee welfare is to improve the working class a lot and therebymake the worker as a good employee and a happy citizen. => Employee welfare is an essential part of social welfare. It involves adjustment of an employees work life and family life to the community or social life. => Welfare measures may be both voluntary and statutory. Voluntary measures are theresult of paternalistic and philanthropic feelings of employer. These may also be provideddue to customs or traditions in the particular industry or region. Statutory measures areprescribed under labour laws. => Employee welfare measures are also known as fringe benefits and services.

PERFORMANCE APPRAISAL SYSTEM AT ONGC Performance appraisal report is an index of an employees work performance over a given period of time. It is crucial for his or her career growth as it indicates the strengths, weaknesses,training needs, nature of job being performed and problems faced in work situation.The objectives of the performance appraisal system at ONGC are: To set norms and targets of work performance, as well as, to monitor the work progressof employees. To facilitate placement of employees in accordance with their suitability for differenttypes of assignments. To provide an objective basis for determination of merit, efficiency and suitability for the purpose of promotion. To identify areas requiring exposure for training and development.The performance appraisal system seeks to evaluate: The work performance of an employee on the present job in relation to the expectedlevels of performance, both qualitative and quantitative. The extent of development achieved by the employee during the period under review. Evaluation of behavioural attributes, attitudes and abilities. Evaluation of potentials for assuming higher responsibility.The appraisal covers: Performance during the period from 1St April to 31St march of every year. All regular employees of the company. a) Non Executives. b) Executives The appraisal form PAR/ACR is filled in respect of all such employees who have served for a period of at least four months in the organization during the relevant year.

Procedure PAR/ACR in respect of an employee is required to be assessed by levels indicated below: By the reporting officer under whom employee is working. By the reviewing officer.

The reporting officer for writing PAR of an employee of class III/IV and E-0 level category will be the executive under whose control the employee is working. The reviewing officer will be of one grade above the grade of reviewing officer. The PARsin respect of class III/IV employees duly reviewed is maintained atRegion/Institute/He adquarters group wise in the concerned establishment section/PAR sections. The PAR in respect of E-0 to E-6 level executives is being maintained in PAR departments at headquarters of R&P division. As regards E7 and above all such reports which are received fromRegions/Institutes/Headq uarters are maintained at Chairman-cum-managing Directorsoffice. The reviewing officer will be the officer to whom the executive reports for his day to day work. Review of the PAR will be done by the executives to whom the reporting officer is responsible for his functions. Accepting authority will be the executive higher than the reviewing officer at different levels depending upon the nature of the grades as per delegation of powers in PAR rules. The performance appraisal reports of executives of E-6 level i.e. Deputy generalmanager and above will be submitted to concern functional Director for final reviewand acceptance. The performance appraisal reports of executives of E-5 level i.e. chief manager and equivalent will be reviewed by the RD/ED/Nominee of the Director concerned. The performance appraisal of the executive upto E-4 level i.e. manager and equivalent would be reviewed by the functional head/GM/CGM not less than E-7.

RESEARCH METHODOLOGY
The approach used for the study was Survey Method. For this Literature and Diagnostic Surveywere carried out: LITERATURE SURVEY Secondary sources were referred to get the basic culture and working pattern of ONGC. All therequired information was collected from the in-house journals, magazines, reference books,manuals and the other related sources. DIAGNOSTIC SURVEY It was done with the help of a questionnaire to check the efficiency and effectiveness of the system.

SIGNIFICANCE OF STUDY Human Resource Development is the basis of success of any organization. HRD helps toenhance employees effectiveness and helps to achieve organizational goals. Now with theemergence of so-calledNEW ECONOMY the increasing role of knowledge in industry is becoming obvious. In the emerging knowledge age, incessant learning by employees througheffective Training and Development is going to be a key to survival and growth for or ganizations. Without effective Training and Development no enterprise can claim to be givingdue importance to HRD. Performance appraisal in the real sense can be carried out only whenthe employees are provided with the required amount of training. In the unfolding economicscenario it is increasingly being realized that employees are the most precious assets of any company. Any investment in introducing performance appraisal techniques is worth only whenthe above mentioned criterion is fulfilled. Every organization nowadays is using various methods for appraising the performance of the employees so that the real potential of the humanasset can be known and utilized in the proper way. Performance appraisal not only evaluates thework done by the employees but also tries to boost the morale and motivate them to do their best. The methods used by the organization should be communicated to all the employees whocome under its purview. They should be satisfied with the procedure and if they are not then itshould be looked upon that what are the reasons behind it and what changes are to be broughtabout. Performance appraisal has a very important aspect to it and that is development of theemployees.

METHOD OF DATA COLLECTIONPRIMARY DATA


The primary data to be selected was based upon the response of the respondents to thequestio nnaire designed. The questionnaire consists of closed ended questions.A part of Questionnaire was targeted to know the personal details of the respondents. Second part consists of closed ended questions on the scale of 1 to 5. Third part comprised of questionsto be answered in Yes or No. SECONDARY DATA The secondary data was collected by referring through manuals, journals and intra net, web sites,and the final data was analyzed systematically to achieve the desired result. Tools of Data Analysis The collected data has been analyzed keeping in view the objectives of the study. The statisticaltool used is Chi-square test in this study. LIMITATIONS Due to time constraint and hectic schedule of ONGC employees some time I founddifficulty in interaction with employees. Organization being very large an effort was made to do the tasks effectively andefficiently but more detailed study could have done by having large sample size. Employees delayed in submitting the feedback form so it effected the time in compilingand analyzing data for findings and suggestions. Many questions were responded as Cannot Say due to the subjectivity of the topic andsome information was not revealed due to certain reasons like being confidential innature.

In 360ofeedback system the performance information is collected from multiple partiesinclud ing ones subordinates, peers, supervisors and customers or clients. As of now in ONGConly superior appraise the subordinate.Majority of the respondents want that the 360 degree appraisal system should be introduced. Intheir opinion this system will reveal the truth about the managers. However 27% respondentsdont want this system to be adopted. They think that this system will give rise to disagreementsand one may criticize the boss freely without any basis.

MAJOR FINDINGS
Performance Appraisal System in ONGC is not transparent. Appraisers are usually unbiased. Employees are not able to know their actual position after the appraisal. The management is serious about the appraisal process. The appraisal process provides them an opportunity for development and growth. Relations with the superior affect the evaluation. Greater weightage is given to the recent performances. There are fixed standards to evaluate the performance but those are not clear due to thesubjectivity of the topic. Raters know how to conduct the appraisal. Raters are not that much concerned about the varied needs of people at levels of experience and background. Superior-subordinate relations are good. Superior helps them set and achieve meaningfulgoals. This makes the environment amiable and congenial. Performance appraisal sheet is lucid and easy to understand and fill. The parameters used to appraise the potential are ample. The system being not so transparent, employees are unable to identify the performancegaps in order to prepare for the future. Individual feedback is not provided. The management helps provide an atmosphere where all are encouraged for comradeshipand teamwork. Appreciation is provided for the good job done. The appraisers are generally aware about their subordinates and their talents and potential. Most of the raters have the ability to give constructive criticism in a friendly, firm and positive manner. Employees dont have the opportunity to respond to the appraisal result. Employees are being rated on their knowledge and skills. Majority of people want that there should be some incentives based on performance.

Employees are not provided with the genuine feedback. Appraisal counseling is considered beneficial for future developments. Management doesnt bother much about the training requirements mentioned in theappraisal sheet. Most of the employees want that 360ofeedback system should be introduced.

RECOMMENDATIONS The performance appraisal system of ONGC is of good quality. With the introduction of new e-PAR system, the PMS system is refined further. On the basis of the analysis of responses andfindings I have reached to some conclusions. So taking them into consideration few steps may be considered to strengthen the performance appraisal system. The system should be made more transparent. This can be achieved by creatingawareness a mong the employees regarding each and every aspect of the appraisal process. They should b e made aware about the standards and the criterions for evaluation. Further they should be shown the appraisal result. The appraiser and appraisee should sit together and then the appraiser should rate theappraisee for his performance and should state the reason for the same. This will increasethe level of transparency and the employee will feel satisfied as he will have anopport unity to respond at that very moment itself. The genuine feedback should be provided to the employees. So that they may be in a position to know where they stand exactly. So that they can identify their performancegaps and prepare accordingly for the future. The general belief among employees is that the relations with the superior affect theevaluation process. This is not good as this creates a sense of favoritism in theorganization . No doubt one should be in pleasing terms with the superior but that shouldnot affect the evaluation at all. For this the raters should always consider the performanceas the only measure for the evaluation. The raters should take note of the critical performance incidents of an individual so thatat the end of the year it should not be that only the recent performances are given moreweightage. Raters should consider the specific requirements of the people to do the job. They shouldhelp them out by providing necessary skill set to do the job more efficiently. Theyshould set the goals as per the potential and caliber of the individual. Employees should have the opportunity to respond to the appraisal result. For thisindividua l feedback should be provided. Management should take serious note of the training requirements shown by theindividual in the appraisal sheet. Training plays a vital role in the development of anindividual and helps improve the performance. Some incentives should be introduced on the performances basis. This thing creates asense of healthy competition among employees which boost up the growth of theindividual as well as the organization.

CONCLUSION During the course of study I interacted with various levels of employees belonging to different department and performing various function. After forming the final questionnaire survey was conducted. As a result of thissurvey primary data was collected and the information so collected wascomplied to give data and make analysis to give suggestion for improvement. .After analysis can be said that employee percentage satisfies with the present performance appraisal system is more than that of dissatisfiedemployees. Those satisfies with the PAR forms said that ONGC normallytakes every step to make changes in the PAR form from time to time tocope up with the changed situation and HR policies of the company asand when it is felt necessary but the disagreeing group suggested thatthere should be transparency in the system.

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