1.

1INTRODUCTION
Performance appraisal is the process of assessing performance and progress of
employee or of a group of employee on a given job and his potential for future development.
It is a type of structured interaction between a subordinate and supervisor that usually takes
the form of a periodic interview, in which the work performance of the subordinate is
examined and discussed, with a view to identifying weakness and strengths as well as
opportunities for improvements and skills development.
Appraisal of one individual by another individual is a continuous process and it is
Natural phenomenon in human beings. This is constantly done, consciously or unconsciously
in our day-to-day interaction either in family life or in a social setting or in an organization
for that matter. While the individual or a group uses appraisal in its own fashion depending
upon the need of the situation, in an organization it becomes necessary to adopt a formal
methodology of appraisal system because of the requirement of measuring the performance
for considering suitable reward or punishment or for assessing the potential of a person to
increase the responsibilities. In short, there is a great requirement for assessing the efficiency
to gear up the productivity of the work force.
The process of HRD helps the employees to achieve and develop technical,
managerial, behavioral knowledge, skills, abilities and moulds the values beliefs, attitudes to
perform present roles. The process of performance appraisal helps the employee and
management to know the level of employees performance compared to the standard/predetermined level.
Performance Appraisal is essential to understand and improve the employees
performance through HRD. In fact, performance appraisal is the basis of HRD. It was
viewed that performance appraisal was useful to decide upon employee promotion/transfer
salary determination and the like. But the recent developments in Human Resources
1

Management indicate that performance appraisal is the basis for employee development.
Performance Appraisal indicates that the level of desired performance level, level of actual
performance and the gap between these two. This gap should be bridges through the Human
Resource development techniques like training, executive development.

1.2 NEED FOR THE STUDY

An organization needs to have an appraisal system that is free from bias. Being fair
and objectives are of utmost importance for the integrity of the performance review process.
Unfortunately, personal biases, prejudices and idiosyncrasies, occurring at the subconscious
level can have a negative effect on an employees evaluation. It has observed that if an
employee gets severely negative feedback he can have a deflated picture of his performance
and development needs and might feel angry, alienated, de-motivated and demoralized
ending up suffering from a loss of confidence. On the other hand, when an employee receives
positive feedback, there might be wrong perception from other employees who perceive that
one employee enjoys preferred status.
In view of the above situations one need to have meaningful insights on the
performance appraisal system to understand, judge, frame and abide it. Hence it reviews and
analyses performance appraisal from the conceptual and theoretical framework, which are
advocated by the pioneers in human resource development area. In order to know
performance appraisal role in the organization this study need to be carried and the impact of
performance appraisal on the organization development and employees performance should
be considered. To know the organizations benefits through performance appraisal system
and the different methods adopted in the performance appraisal and the advantages and
disadvantages in adopting them by the organization. The study is needed in order to

Provide information about the performance ranks basing on which decisions regarding
salary fixation, confirmation promotion, transfers, and demotions are taken.

Provide feedback information about the level achievement and behavior of subordinates. This information helps to review the performance of rectifying
performance deficiencies and to set new standards of work, if necessary.

Provide information which helps to counsel the sub-ordinates.

3

Provide information to diagnose deficiency in employees.

Provide information for correcting placement.

To prevent grievances and in disciplinary activities.

1.3 OBJECTIVES OF THE STUDY

The study of Performance Appraisal System in Nagarjuna Agrichem Limited will be
carried out with the following objectives:

To study about the performance appraisal system followed in

Nagarjuna

Agrichem Limited.

To apply and understand the theoretical concepts on performance appraisal in the

organizational environment.

To evaluate performance appraisal impact on the employee growth and

development.

To examine whether the performance appraisal system fulfills the requirement and
purpose of the organization.

To suggest recommendations in the light of the study for the improvement of

performance appraisal system at Nagarjuna Agrichem Limited.

1.4 METHODOLOGY
Methodology is scientific and systematic search for pertinent information on specific
topic. The reliability of management decisions depends upon the quality of data. Basically
we have two types of data:

Primary data.

Secondary data.

PRIMARY DATA
Primary data can be collected either through experience or through survey. Those
which are collected a fresh and for the first time thus happen to be original in character that is
called primary data.
We collect primary data during the course of doing experiments in an experimental
research but in case we do research of the descriptive type and perform surveys, and whether
sample surveys or census surveys, then we can obtain primary data either through observation
or through direct communication with respondents in one form or another of through personal
interviews, This, in other words, means that there are several methods of collecting primary
data, particularly in surveys and descriptive researches important ones such as observation
method, interview method, through questionnaires, through schedules etc.
Primary data can be collected in the following ways:

By observation

Through telephone interviews

By mailing of questionnaires

Through schedules

SECONDARY DATA
Secondary data means data that are already available that is they refer to the data
which have already been collected and analyzed by some one else and which have already
been passed through the statistical process is called secondary data. Secondary data may
either be published data or unpublished data that data are available.
Usually published data are available in various publications of the central, state are
local governments; various publications of foreign governments or of international bodies
and their subsidiary organizations technical and trade journals; books magazines and news
papers etc. are sources of secondary data.

Researcher must be very careful in using

secondary data.

1.5 LIMITATIONS OF THE STUDY

In the present study of Performance appraisal in the Nagarjuna Agrichem Limited plant the
following limitations are there:

The Project duration was only 45days. Therefore time was insufficient time for
in-depth study.

Accuracy of the study is based on the information given by the respondents.

Therefore it may have bias.

Some of the employees would not reveal much of the information for the fear of
the superiors.

Confidentiality of information is also limiting factor for analysis of data.

Some of the trainees could not reveal much of the information for the fear of the
management.

The study is restricted to Nagarjuna Agrichem Limited, Srikakulam unit only.

2.1 INDUSTRY PROFILE

Pesticides are an essential input on increasing agricultural production by preventing
crop losses before and after harvesting. So, providing total agric-based solutions try the
Indian farmers has becomes an important motto of the company. Indians agrarian economy
coupled with its booming population impulse the countries pressing need to provide higher
output in terms of food grains with lower inputs in terms of natural resources to food its
ever increasing millions.
To sustain the increase in policy in crop yields required to feed future population
sustainable form of agro-chemicals need to be developed. The challenges are to find right
solution and implement ideas that work in the field. Pesticides include insecticides
fungicides, and herbicides, rodenticides, nematocides etc are derived from chemicals they are
first manufactured as technical grade product having chemical purity. Consumable pesticides
are then produced bun conversion of those products into approved formulation which is tailor
made for application on diverse insect pest spectra, plant disease, weeds etc. The pesticides
industry in India comprises of basis manufactures. Formulation, importers distributors and
dealers in public or private or corporate sector

there is large, medicine and small-scale

industry.
PESTICIDES PRODUCTION
Importing DDT for malaria made use of pesticides in India for the first time a small
scale and BHC for locust control in 1948. Pesticides use in agricultural began for the first
time in India in 1949. Ingenious production of pesticides began with the establishment of
DDT and BHC plant in 1945. By 1958, India was manufacturing five basis pesticides for a
total production forever 5,000 tm. There after the industry has study progress reaching a
production volume of about 60,000 tm. per annum in mid eighties. Till lately bulk of the
production has been of insecticides but now fungicides and herbicides are also catching up
9

today, India is the largest manufactures of basic pesticides chemicals between the south Asian
and African countries next to Japan. In all 143 pesticides have been registered in the country
66 are technical grade pesticides manufactured in country.
The pesticides industry in India grew during the period from 1966 to 1947. The total
installed capacity increased from 1000 tm in 1947-78 i.e. about 10 told increase registering an
average annual compound growth rate of about 10 percent. Today the installed capacity
stands a 1, 16,000 tones.

At present the formulation capacity installed in the organized

sector is about 70,000 tm in terms of technical grade material, similar formulation produced
in the company include dusts, wetted powers, emulsion concentrates, granules and
encapsulation.
GLOBAL LEVEL
Worldwide pesticide use increased steadily during the 1970s and 1980s at around 5
percent per year. Presently however, the industry is experiencing a maturing market, with
accompanying lower growth levels, concentration and slower innovation rates (Boardman,
1986). World use of pesticides in 1992 declined to an estimated US $25.2 billion at the user
level, a decrease from $26.8 billion in 1991. This decrease was brought about mainly due to
cereal hectare reductions in the EU as a result of Common Agricultural Policy reforms. The
U.S., Canada, Western Europe and the Far East remain the leading geographical markets
respectively, with the U.S. and Canada accounting for almost one third of the world market.
Canadian sales represent 3percentage of the total global crop protection market. Western
Europe and the Far East each account for one quarter of the world market. Estimates for
world pesticides sales by 1997 will reach U.S. $26.7 billion annually, representing a real
growth rate of 1.1 percentage per year in 1992 dollars (CEH 1994).
Below table provides a listing of the top ten agrochemical manufacturers worldwide.
All ten companies showed an increase in sales when 1996 sales figures were compared to

10

those for 1995. Monsanto had the largest increase, partially as a result of their development
efforts in herbicide tolerant crops. The majority of these firms are also involved in industrial
chemicals, animal health, pharmaceuticals, and life sciences. The number of firms has
decreased in recent years due to consolidation driven by the high costs associated with basic
research and development of new active ingredients. International mergers and acquisitions
amongst the manufacturers have been occurring, such as that between Ciba-Geigy and
Sandoz to form Novartis Crop Protection. (Strategic database, SIC-E3729 Industry
Structure, Other Agricultural Chemicals).
In general, the balance sheet for a large manufacturer would have assets in excess of
$10 billion (some are over $US 20 billion) and liabilities of approximately half the asset base.
For example, in 1996 Monsanto had assets of $US 11.2 billion and liabilities of $US 7.5
billion. Sales volumes vary greatly between manufacturers but the normal sale to asset ratio is
$1 in sales for $1.2 in assets. Many of the manufacturers are quite profitable and have a
historical track record of achieving a 12 percentage or better return on investment.
AGROCHEMICAL SALES OF TOP TEN COMPANIES
s.no

company

sales (us$ mil)

1
2

Novartis
Monsanto

4,527
2,997

percentage change vs.

1995
4.5
22.8

3
4
5
6
7
8

Zeneca
Agrevo
Du Pont
Bayer
Rhone-Poulenc
DowElanco

2,630
2,493
2,472
2,360
2,210
2,000

11.3
6.4
6.5
1.2
5.7
1.9

Cyanamid

1,989

4.1

10

BASF

1,541

8.4

11

SWOT ANALYSIS OF PESTICIDE INDUSTRY

STRENGTHS

Pesticide industry helps for more crop productivity

Organic fertilizers have been known to improve the biodiversity and long-term
productivity of soil, and may prove a large depository for excess carbon dioxide.

Organic nutrients increase the abundance of soil organisms by providing organic

matter and micronutrients for organisms such as fungal mycorrhiza, (which aid
plants in absorbing nutrients), and can drastically reduce external inputs of
pesticides, energy and fertilizer, at the cost of decreased yield.

WEAKNESSESS

More expensive to produce

No awareness regarding the chemical fertilizers to the farmers

OPPORTUNITIES

Product differentiation with other competitive company products

Creating awareness to the new branded products

Increases the market share value with their quality products

Low time to market

THREATS

It causes many diseases to the mankind

Organic fertilizers may contain pathogens and other disease causing organisms if
not properly composted

Nutrient contents are very variable and their release to available forms that the
plant can use may not occur at the right plant growth stage

Organic fertilizers are comparatively voluminous and can be too bulky to deploy
the right amount of nutrients that will be beneficial to plants
12

THE NAGARJUNA GROUP

Nagarjuna Agrichem Limited Fertilizers, seeds, Agri output and agricultural R&D

Nagarjuna Fertilizers and Chemicals Limited (Manufacturing Industry)

Vijayalakshmi Insecticides& Pesticides Limited pesticides formulations

Nagarjuna Palma India Limited water management systems.

Nagarjuna Steels Limited cold rolled steel strips and formed sections

Nagarjuna power corporation Limited power generation

Nagarjuna International Limited sugar

Nagarjuna finance Limited integrated financial services

Bhagiradha chemical and industries Limited

NAGARJUNA CULTURE
We live every moment of life in harmony with nature to create value
For our shareholders and the society and over selves. As individuals, we shall always

Be humane

Be cordial and Pleasant.

Be honest and equitable.

Be giving and forgiving.

Be positive and at work, we shall always.

Create and environment, where work becomes an enjoyable experience.

Align individual goals with organizational goals.

Share knowledge and information

Be proactive and responsible

Pursue excellence

Be committed

13

2.2 COMPANY PROFILE

NAGARJUNA GROUP HISTORY
The Nagarjuna group has chosen the name of renowned mathematician and spiritual
leader Acharaya Nagarjuna of 1st century ad who propagated the teacher of Buddha.
In choosing the name of this outstanding individual, the group as a learning
organization reflects its commitment to put into practices the ideals and ideology that
acharaya Nagarjuna stood for.
The Nagarjuna group has founded in 1973 by Shri. K.V.K.Raju with a modest investment
of us $ 23 million, the Nagarjuna Group today is a prominent industrial us $ 2.5 billion
1973

Birth of a business group that pioneered several core sector enterprises in

the coming decades, starting with manufacturing steel, Nagarjuna steel limited was
launched.

1985

With focus on Agricultural input business started plant nutrition business with
Nagarjuna fertilizers and chemicals ltd.

1992

Forayed into the crop protection business with investments in Pesticides

formulations manufacturing in the year 1994.

1994

Micro irrigation business started to address the irrigation problems of farmers

living in water and energy scarce regions.

1995 Ventured into energy sector, entered into power generation by setting up
Nagarjuna Power Corporation limited.
1997

Entered into petrol by setting up Nagarjuna Oil Corporation Limited.

Consolidating its core activities, to day the groups major operations cover Agri and

energy sectors. The corporate logo of the Nagarjuna Group symbolize a dynamic and value
based organization, seeking to actualize the concept of trusteeship.

14

NAGARJUNA AGRICHEM LIMITED

Sri Kanumuru Venkata Krishna Raju was freedom fighter. He came from a family of
Agriculturists. He secured graduate qualification from Berbers University and further
specialized in automobile Engineering from the Madras Institute of Technology. There after
he went USA to secure MS in Industrial Engineering form the Michigan state University and
later he won mechanical Engineering Minneapolis.
Kanumuru was a dreamer and visionary with dream to promote an industrial project
to serve society through industry. In 1974 he established M/S Nagarjuna steel limited and
later applied for license to produce urea with the Government of A.P. which was lying idle
and materialized.
It was not easy task for Venkata Krishnam Raju to have the project of Nagarjuna
Agrichem limited K.V.K. with his sincere efforts convinced the Government of A.P. the
professional approach of Nagarjuna Group and wages given the responsibility in the face of
considerable competition from large group. He justified the confidence reposed in the group
successfully commissioning the Nagarjuna Agrichem Limited plant and securing smoothly.
In the recognition of his contribution to industry and eminence in business, the
Jawaharlal Nehru Technological University had conferred on him Nayudamma Menoria Gold
medal, Udyog Ratna award and the Dr. K.L. Rao award for excellence.
The group has merged Sri Ganesh and Petro Chemical Limited with the company.
The company has got the scheme approved by the Honorable High Court of A.P. in
December 1994 for the merger of Sri Ganesh and Petro Chemical Limited with Nagarjuna
Agri Chem Limited. Thus the mission of the company Serving Society through Industry
and its visions to be leader in crores industries and its Goal to evolve into.
Nagarjuna Agri Chem is part of the U$$ 4500 million Nagarjuna group, one of the
leading industrial houses in India having diverse interests in Agrochemical, Fertilizers, Seeds

15

water management system, power, steel, financial service, Securities and international
trading. The group is poised to reach US$ 4.5bilion in the next few years. Nagarjuna
Agrichem echos the same values, ethos and commitment of its parent group. It has adopted
in letter and spirit the core values of the Nagarjuna Group Concern, commitment, quality and
integrity. Nagarjuna Agrichem Limited is a leading manufacturer and suppliers of high
quality agrochemical in Indian and aboard.
The company operates one of the most modern and comprehensive facilities neat TPA
for the manufacture of Acephate, Monocrotophos, DDVP, Atrazin, Profenofos, Technical and
Monocrown, PaceAT250percentage WP, Prefix50percentage EC,Profex 25percentage EC
formations which will increase to 3600 TPA by 2001. The company has firm plans to
manufacture a wide range of other insecticide and Pesticide Technical. The R&D team at
Nagarjuna Agrichem is constantly focused to develop safer Technologies and better products
for serving the growing crop protection needs of the agro-sector.
Nagarjuna Agrichem Limited foundation laid by the Late Sri K.V.K.Raju Chairman
Nagarjuna Group, in 1992. It started production in 1994. Head office is situated at Auto
Plaza, 1st Floor road No.3, Banjara Hills, and Hyderabad. Factory is located at Arinama
Akkivalasa, 15Kms from Srikakulam Town.
Mr.P.M.K.Raju manager (personnel) is the Head of the personnel Department. Total
site is 70acres, 20acres has been occupied by Factory, remaining 50 acres is occupied by
Green Belt with mango and other Trees. Now 301 permanent employees are working in this
plant.
MILE STONES
Bhoomi puja

4th may, 1993.

Startup of Plant

2nd June, 1994.

Commercial Production

1st July, 1994.

16

Highest Yearly Production

(Monocrotophos)

1,440 tones (97 Years).

Highest Purity

80.72 (16-3-95).

(Monocrotophos)

156.91 tones (April 97).

Highest Number of batches

150 (March 98).

Highest Monthly Production

CORE VALUES OF NAGARJUNA AGRICHEM LIMITED

Commitment

We are committed to provide maximum

Satisfactions form all our shareholders.

Concern

We care for the concerned for other everything

What we do.

Integrity

We will make continuous affords to Improve

our depth of character and integrity in our
personnel and professional relationship.

Quality

We are continuously seeking the ways of

doing things.

Mission

Serving the society through the industry

17

NAGARJUNA AGRI CHEM LIMITEDS VISION STATEMENT

SERVING SOCIETY THROUGH INDUSTRY
For close to two decades, we at Nagarjuna Agrichem Limited have predominantly
been in the business of manufacturing and marketing Urea, a segment of the plant Nutrition
business space. Given our cumulated experience and strengths in understanding the farmer,
the agriculture, various initiatives taken in the past, the exposure of Indian agriculture to
global economy and therefore the need to provide innovative and Comprehensive Plant
Nutrition Solutions.
The leadership we refer to in our Vision Statement is in terms of providing innovative
and creative solutions.
NAGARJUNA AGRI CHEM LIMITEDS MISSION STATEMENT
We shall

Pioneer transformation in the approach to plant nutrition

Deliver holistic plant nutrition solutions to the farmers

Be the most preferred organization to be associated with

Pioneer transformation in the approach to plant nutrition we shall develop crop, site
and stage specific wholesome plant nutrition solutions. Nagarjuna Agrichem Limited shall
focus on all necessary initiatives towards this be it manufacturing technology, regulatory,
logistics and using a mix of several sciences and skills. The most preferred organization to be
associated with in the process of providing these solutions, Nagarjuna Agri Chem
Limited shall delight all the stakeholders employees, investors, suppliers.
FUNCTIONAL DEPARTMENTS OF NAGARJUNA AGRI CHEM LIMITED
Nagarjuna Agrichem ltd. is one of the leading pesticide industry in India. Today,
Nagarjuna involved in the manufacture of a wide range of plant nutrients, micro irrigation
and fustigation systems, production of high yielding seeds and highly effective plant

18

protection products. Focusing on extensive research and development programme and

transfer of knowledge of scientific farming techniques from the field to farms, on addition to
exploring and devising new ways of marketing agricultural products.
Nagarjuna Agrichem Limited Head office is situated at Auto Plaza, 1st Floor road
No.3, Banjara Hills, and Hyderabad. Factory is located at Arinama Akkivalasa, 15Kms from
Srikakulam Town.
The Nagarjuna Agrichem Srikakulam is divided into 9 divisions for their
administrative convenience. Director is the chief of the unit, under him president. Who is
looking after the day to date operations of the organizations. The above personal
Administration, Purchases, Store, Account maintenance, Technical, Production, Projects, and
Fire and Safety.
Since the organization is comprises different pesticides, maintenance is a big problem
to the management. Hence the maintenance department further divided into 3 divisions. They
are mechanical, Electrical, Instrumentation and Civil for their administrative Convenience.
There are mainly four functional departments in the company

PRODUCTION DEPARTMENT

MARKETING DEPARTMENT

FINANCIAL DEPARTMENT

PERSONNEL DEPARTMENT

PRODUCTION DEPARTMENT
NAGARJUNA AGRICHEM LIMITED manufactures the technical grade of the
following products at Srikakulam, Andhra Pradesh. The details of products specification,
purifies and applications are indicated below.

19

MONOCROTOPHOS
Monocrotophos is an Organo phosphorus insecticide having contact and systematic
action. It is also an acaroids. Being broad spectrum in action. Monocrotophos is used
against a wide range of sucking and chewing pests attracting paddy, sugarcane, cotton,
vegetables, pulses, coffee and cardamom.
MONOCROWN
Monocrown 36 is well accepted by the farmers and pest control agencies for
controlling pests, because of its salient features.

Monocrown made of Monocrophos technical.

Monocrown has quick knock down action

Monocrown is effective for a long time

Monocrown is safe for human being

Monocrown is easily available in the following packs 100ml, 250ml, 500ml,

20lts.

ACEPHATE
Acephate is an oregano phosphorous systematic insecticide of moderate persistence
with residual activity lazing c, 10-15d. Effective against a wide range of aphidian,
lepidopterist larvae hymenoptera and thysonoptera.
PROFENOFPS TECHNICAL
The company has developed manufacturing process in its R&D and the project
implementation work is in progress. The company proposes manufacture it from December
1999.
Manufacturing

Technical Grade and Formulation in Bulk

Size of packages

100ml, 200ml, 500ml, 1lt, 5lt.

Application

Paddy, cotton, vegetables, crops etc.

20

PRODUCTION FOR THE YEAR 2005-2008

PRODUCT

DAILY

YEARLY

5 tones

1680 tones

3.5 tones

1188 tones

Atrazin

3 tones

840 tones

DDVP

1.3 tones

430 tones

Profenofos

3.1 tones

980 tones

MCP(Monocrotophos)
Acephate

FACILITIES FOR PRODUCTION

LAND

Total area :

90 Hectares

Built up

20 Hectares

Green Belt :

70 Hectares

INSTALLED CAPACITY

Monocrotophos Technical / Acephate Technical-1500 TPA

Proposed Capacity - 2700 TPA

MARKETING DEPARTMENT
The company has a network of over 2800 dealers spread all over the county. The total
sales are 10085 lacks. The sales increased during 2007-08. Gorses sales in the last year 2008
- 2009 is 605.36 Cores has been increased to the 412.10 Cores due to the innovation and
introduction new pesticides products in the market and also Nagarjuna Agrichem Limited
encouraged their dealers and sub dealers to their marketing on the wide range of their
products Nagarjuna Agrichem Limited launched new product TRICYCLAZOLE have good
demand in Japan and china and expecting good export business in the present year.

21

Nagarjuna Agrichem Limited got more revenue in export of ace hate technical gained
almost all three cores business in the abroad. Pesticides industry plays critical role in Indian
industry. Heavy completion for the pesticides products in India is having major role of the
large-scale industries. Traditionally small-scale industries got good place and served farmers
covering of all areas in India. due to the heavy competition of small-scale industries and with
standing with the large-scale industries, more number of small sectors is undergone with
heavy losses and closed most of industries in the present market scenario. R&D will help to
the pesticide industries to innovation of new technologies and products to encourage their
business in the large Valium.
Marketing departments plays an important role in an organization and their vision to
increase sales and export the sales in a wider view and also Nagarjuna Agrichem Limited
marketing department making sales their network for making up job works and supply the
bulk to the larger industries.
MARKETING DETAILS
PRICE
Nagarjuna Agrichem Limited is fixing the price-based factors
Competitors pricing strategy
Cost of production
PLACE
Nagarjuna Agrichem Limited concentrates more on the north and south markets. It
sells 80percentage of the production in the above markets and Addition to West market. The
Three zones cover the following states
North

: Punjab, Haryana, Rajasthan and UP

South

: AP, Tamil Nadu and Karnataka

West

: Maharashtra, Gujarat, and part of Madhya Pradesh.

22

DISTRIBUTION CHANNEL OF NAGARJUNA AGRI CHEM LIMITED

Manufacturer ---- Dealer --- Consumer.
PROMOTION
The major promotional tools used by Nagarjuna Agrichem Limited are as follows in
order of their importance.

Field activity

Publicity

Advertisement in trade journals, magazines, Television and other media

MARKETING SERVICES
Marketing Research is the gift of the modern concept i.e. Consumer oriented.
Marketing Research is based on the later concept of marketing decisions.
The use of scientific methods in the solutions of marketing and distribution of costs
and marketing and maximizing the points. Marketing research is a part of social research and
has acquired academic status during modern time. It is the collection and interpretation of
facts that helps marketing managements to get products more efficiently into the hands of the
consumers.
MARKETING SERVICES & AIMS OF NAGARJUNA AGRICHEM LIMITED

To define the probable market for specialized products and report on general
market conditions and tendencies, buying habits etc.

To assess competitive strength and policies.

To estimate potential buying power in various areas.

To indicate the distribution methods best suited to the products and the Market.
To identified marketing opportunities of problems.

MARKETING SERVICES ADOPTED BY THE COMPANY

23

Planning and implementation.

Marketing research

Sourcing of bio fertilizers

Handling of products complaints.

All requirements with respect to lead districts

All matter relating to sample drawn by the government authorities

Organizing marketing conferences

Library maintainers

Training programs.

OURSTAKE HOLDERS
Employees, customers, investors, strategic partners environment and community ecofriendliness and eco-investment-a way of life. Emphasis on safe manufacturing processes
and practice is a critical governing factor. Elaborate effluent treatment systems and effective
mentoring stations ensuring the best environment protection standards. Eco investments
through extensive investments in green belts have been an essential part of our corporate part
of our corporate ethos.
COMMUNITY WELFARE
It is our commitment.

Emphasis on community development is done through

education health-care, environment restoration and income generation to community through

assets creation.
India is lane of agriculture where 70 percent of population depends upon it. This is to
sustain increasing on crop-yields. It is essential to develop agricultural needs. The challenge
is to find right solutions and implement. The ideas that work in the field. This has been the
priority of the Nagarjuna. Creating a new perspective which helped view agriculture as
consisting of three types of systems, economic, ecological and social.
24

Nagarjuna today involved in the manufacture of a wide range of plant nutrients, micro
irrigation and fustigation systems, production of high yielding seeds and highly effective
plant protection products. Focusing on extensive research and development programme and
transfer of knowledge of scientific farming techniques from the field to farms, on addition to
exploring and devising new ways of marketing agricultural products.
PERSONNEL DEPARTMNT
Human resources management is the systematic planning and control of a network of
fundamental organizational processes affecting and involving all organization members.
These processes include human resources planning job and work design, jobs analysis,
staffing, training and development, performance appraisal and review, compensation and
reward, employee protection and representation and organization improvement.
Human resource department has a major role in especially human resources planning.
Both directors of the company, human resources managers play critical roles in the
development of training programs. They assume leadership in developing such programs.
Managers and supervisors throughout the organization plays major role in providing
information for the human resources departments to use in developing and evaluating training
programs. They can also participate directly in the training program as trainers. In fact, some
managers feel that training to sub ordinate performance capabilities is one of their most
productive tasks.
The use of highly respected managers and professionals also provides instant
credibility to a well-planned training program. The Nagarjuna Agric hem limited,
Srikakulam is divided into 9 divisions for their administrative convenience. Director is the
chief of the unit. Under him the president is the chief to look after the day-to-day operations
of the organizations.

25

Nagarjuna Agrichem Limited has personnel and administration department which

involves in the following activities:

Human Resource Development

Recruitment, Selection, Induction Training

Wages and Salary Administration

Industrial Relations &Welfare activities

Time office Management

Security & Green belt management

public relations

TOTAL MANPOWER IN NAGARJUNA AGRI CHEM LIMITED

There are about 526 employees working both technical and non-technical staff
Management staff

197

Technical & Non Technical staff

329

QUALIFICATIONS
Management: Post graduate/ Engineer, Assistants graduates.
Helpers

10th (or) Below

Trainee

fresher

Officer

Graduate and above.

Operators

B.Sc / M.Sc

Fitters

ITI

ACTIVITIES OF HR FUNCTIONS IN NAGARJUNA AGRICHEM LIMITED

Employment practices and conditions of employment-minimum hiring qualifications,
preferred services for recurring personnel, selection tests, methods of wage payments and pay
periods the basis of promotion and promotion channels guaranteed employment after

26

attaining a certain length of services and when an employee is considered as a regular

employees.

Grievance redressed procedure. Employee financial aids-savings loans mutual

benefits associations bonus plan incentives plans.

Health and hospitalization medical health and safety services and

programmers.

Sickness death and maternity benefits or allowances

Public relations

Prohibited activities smoking, gambling, imbibing liquor and soliciting on

company premises and during working hours.

ETHICS
We shall strive for wholesome business relationships by adhering to the principles of
trusteeship, fair play and transparency driven and conductive to in providing discipline,
accountability and depth of character, team spirit and honesty in to our personal and
professional

relationships.

We

shall

build

learning

organization

where creativity, innovation, entrepreneurship and knowledge sharing are encouraged and
fostered actively.
CONCERN
We consciously recognize that the development of associates is inextricably linked to
the sustainable growth and profitability of the organization. Therefore, mutual care and
concern between the associates and the organization shall be our abiding value.
EXPORTS
During the year under the review exports made by the company have grown to 114.73
lacks has compared to 110.32 lacks during the previous year the represents the growth of 85

27

percentage. Building and substantial and growing export business will be a key area of focus
for the company.
OVERSEAS SUBSIDARY
Nagarjuna Agrichem, Australia Pvt. Limited is wholly owned subsidiary of the
company incorporated in Australia. During the year there was no business activity at the
subsidiary. The audited financial statements of the subsidiary and particulars pursuant to the
requirements of section 212 of the companies act 1956.
ENVIRONMENTAL PROTECTION
The company is committed to improve the environment around its area of operation at
Srikakulam. it continuous the nature and expand the waste green belt around the factory. It
has also participated in various community welfare activities in the neighbouring areas.
MANPOWER PARTICULARS
Total Manpower of Nagarjuna Agrichem Limited is 526 Manpower are giving below
table:
TABLE:
S.NO
1

CATEGORY

PARTICULARS/LEVELS

Managers

Top
Middle

Supervisors

Senior
Junior
Admin.Staff

Workers

Skilled
Semi Skilled
Unskilled

28

TIME OFFICE MANAGEMENT

Total time office maintain with manual work. They maintain all the register, and they
follow all the rules. In the time off headed by seniors timekeepers under control of
DY.MANAGER (Personnel). Under him 3 timekeepers are working for the maintain of time
office.
The shift system of the company is as follows:
TABLE:
S.No

Name of the Shift

Working Hours

6 A.M. TO 2 P.M

2 P.M. TO 10 P.M.

10 P.M. TO 6 A.M.

General

8.30 A.M. TO 5 PM

LEAVE AND HOLI DAY ADMINISTRATION

Nagarjuna Agrichem. Limited has a procedure for a granting of leave, if want leave
has an application from (it is printed from supplied by the company) to fill up the application
and mentioned the cause of the leave. This application submits to time office, they
recommended and they put forward to personal officer. He was final authority to grant a
leave.
TABLE:
LEAVES
Casual Leave
Sick Leave
Earned Leaves

TRAINEE

PERMANENT

6
-

9
12

15 days per annum

29

1 day for every 20 physical

working days.

Overall days of work 304/305 days 15 Annual leaves.

From the leaves the companies facilitate encashment system. This is separated to the
staff and workmen, for the staff it is every 10-payment day he gets one encashment of earned
leave and 3 casual leave. For the workman it is employee apply for leave he get
100percentage of encashment. Every workman applies for earned leave for before the one
week, any casual leave not exceed 3 days at a time. Sick leave is exceeds 3 days Doctor to
be certified the sick leave. Holydays are 8 and government holidays are 4. This is
administration of leave and holiday administration. Bonus earned leave facility is also there
for better attendance as an incentive (is called incentive year) additional leaves maximum
limit 21.
FINANCE DEPARTMENT
The company started production of mono crotophos technical, an organophorus
compound in July 1994 in its states of art production facility set up with an investment of
24 cores. Subsequently production facilities for producing of acephate technical, they
added at an additional of 8 cores and Nagarjuna Agrichem Limited is taken up their
expansions on very subsequent year and introduced new products like DDVP, Atazin and
Tricylazole which are highly marketable products in India. Nagarjuna Agrichem Limited
achievement by the production of the Tricylazone product is only the first manufacture in
India.
Nagarjuna Agrichem Limited has established modern effluent treatment and
implemented environment protection measure by investing lot of money. The company set
up in the backward district Srikakulam in the state of Andhra Pradesh, manufactures
technical used in the pesticides industry. It has adopted the low temperature route, which
has helped deliver to the Indian agri sector, product with typical purity of 75 percent

30

against the BIS standard of 68 percent with the production parameters matching the
strength international specification.
FINANCIAL STATUS OF THE COMPANY
Year

Turnover ( c.r)

Gross profit ( c.r)

Net profit ( c.r)

2008 -09

288.59

39.73

24.52

2009-10

351.52

41.83

28.00

2010-11

343.90

32.72

21.23

2011-12

412.10

39.76

25.75

2012-13

605.36

80.40

49.26

2013-14

650.31

91.27

59.76

ORGANIZATION STRUCTURE
The Nagarjuna group is a leading business house in India. It is a dream willed into
reality by its visionary founder Shri.K.V.K.Raju.

Today the group is a 20,000million

conglomerate well entrenched in the areas of agribusiness petroleum, power, life sciences and
new initiatives.
Shri Kanumuru Venkata Krishnam Raju was a freedom fighter, who came from a
family of agriculturist he secured graduate qualification from Benaras University and further
specialized in automobile engineering from the madras institute of technology he secured ms
in industrial engineering Minneapolis. He was a visionary with dream to promote on
industrial project.
The company operates as one of the most modern and comprehensive agrochemical
manufacturing facilities near Srikakulam district on the eastern coast of India. The company
is geographically in close proximity to the ports in India at Visakhapatnam and Chennai
enabling easy Transportation of its products for export.
31

ORGANIZATIONAL STRUCTURE

32

3. THEORITICAL FRAMEWORK
3.1 INTRODUCTION
Appraisal of performance is wide used in the society. Parents their children, teacher
evaluate their student and employers evaluate their employee. However, formal evaluation of
employees is believed to have been adopted for the first time during First World War. At the
inlands of Walter Dill Scott the US army man to man rating system for evaluating military
personal. Once the employee has been selected, trained the motivated, he is then apprised for
his performance. Performance appraisal is the step where the management finds out how
effective it has been at hiring and placing employees if any problems are identified, steps are
taken too communicated to employee and to remedy them.
A performance appraisal is a process of evaluating the performance appraisal is a
process of evaluating the performance and qualification of employee according to job and its
requirement. It is also known as the process of estimating and judging the value, excellence.
Qualities of status of some object person or things. Individually and collectively, it is the part
of all other staffing process, like recruitment, selection, placement, etc.
Performance Appraisal has be seen as an objective method of judging the objectively
performance appraisal can help identify a better worker from a poor one. Performance
Appraisal has direct linkage with personnel system as selection, training, mobility etc. it also
emphasizes on individual development.

33

TRENDS IN PERFORMANCE APPRAISAL

Item

Former Emphasis

Present Focus

Terminology

Merit-rating

Performance appraisal

Purpose

Determine wage increase,

Promotion, transfer, lay off.

Development
of
individual, improved
performance.

For rank and file workers

For managerial and technical

personnel.

Personal traits

Performance,
result
accomplishments.

Application

Factors rated

Techniques

the
job

or

Rating scales with emphasis upon Mutual goal-setting, critical

scores
incidents, group appraisal.

CONCEPT OF PERFORMANCE APPRAISAL

Performance evaluation or performance appraisal is the process of assessing
performance and progress of employee or of a group of employee on a given job and his
potential for future development. In concept of all formal procedure used working
organization to evaluate personality, contribution and potential of employees.
DEFINITION
Performance evaluation or 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 future development.
FORMAL DEFINITION
It is the systematic evaluation of the individual with respect to his/her performance
on the job and his/her potential for development.

34

ACCORDING TO FLIPPO
Performance Appraisal is the systematic, periodic and an impartial rating of an
employees excellence in matters pertaining to his present job and his potential for a better
job.
THE MAIN CHARACTERISTICS OF PERFORMANCE APPRAISAL IS AS
FOLLOWS

It is process of consisting of series of steps

It is the systematic examination of an employees strengths and weaknesses in

terms of his job.

It is a scientific and objective study. Formal procedures are used in this study.

It is an ongoing or continuous process there in the evaluations is arranged

periodically according to a definite plan.

The main purpose of performance appraisal is to secure information necessary for

making objective and correct decisions on employees.

3.2 OBJECTIVES
Performance Appraisal plans are designed to meet the needs of the organization and
individual. It is increasingly viewed as central to good human resources management.
Performance Appraisal could be taken either for evaluating the performance of employees for
developing them.
The objective of the Performance Appraisal can be categorized as either
developmental or evaluative. The evaluative purpose have a historical dimensions and
concerned primarily with looking back at how employees have actually performed over the
given period of time period compared with required standard of performance.
The developmental, a future oriented performance appraisal is concerned for ex: with
the identification of employees training and development and the setting of new targets. The
35

overall objective of Performance Appraisal is to improve the efficiency of enterprise by

attempting to mobilize the best possible efforts from individuals employed in tit. Such a
appraisal achieve 4 objectives including:

Salary review.

The development and training of individuals.

Planning job rotation.

Promotion and transfer decision.

Except the above the Performance Appraisal is also aims at reducing grievances and
improving the job performance by providing feedbacks. It also helps to have comparative
worth of employees.
Appraising the employee performance is thus useful for compensation, placement and
training and development purposes. The existence of a regular appraisal system tends to make
the supervisors more observant of their subordinates because they know that they will be
expected periodically to fill out ratings forms and would be called upon to justify their
estimates.
An appraisal of the employee is undoubtedly necessary at the time of his
employment. However, an appraisal on a continuing basis during the working life of such an
employee is also very desirable. The performance appraisal is also use full to organization as
it can be used for some administrative, employee development and also to assess some
programmed.
Performance Appraisal commonly serves as an administrative by providing employer
with a rationale for making many personnel decision such as decisions relating to pay
increases, promotion, demotion, termination and transfer. For the purpose of employee
development Performance Appraisal provides feedback on an employees performance. The
data provided by the Performance Appraisal is also useful for the training identification of
36

individuals. The Performance Appraisal records can show how effective the recruitment,
selection and placement have been in supplying a qualified workforce. The main purposes of
performance appraisal are as follows

To provide feedback to employees so that they come to know where they stand
and can improve their job performance.

To provide a valid data base for personnel decision concerning placements, pay,
promotions, transfers, punishments, etc.

To diagnose the strengths and weakness of individuals so as to identify further

training needs.

To provide coaching, counseling, career planning and motivation to subordinates.

To develop positive superior subordinates relations and thereby reduce

grievances.

To facilitate research in personnel management.

To test the effectiveness of the recruitment, selection, placement and induction

program

Thus, performance appraisal aims at both judgmental and developmental efforts.

3.3 ADVANTAGES

It provides valuable information for personnel decisions such as pay increases,

promotions, etc.

It helps to judge the effectiveness of recruitment, selection, and placement and

orientation system of the organization.

It is useful in analyzing training and development needs.

It can be used to improve performance thought appropriate feedback, working and

counseling to employees.

It facilitates Human Resource Planning, career planning and succession planning.

37

A competitive spirit is created and employees are motivated to improve their

performance It translates corporate goals into individual, team, department and
divisional goals and so as helps an employee to clearly see his goals.

It helps to clarify the corporate goals.

It is a continuous and evolutionary process in which performance improves over

time.

It relies on consensus and cooperation rather than control or correction.

It encourages self management of individual performance.

It encourages two way communication between superior and subordinates.

It provides continuous feedback to employee, about their performance and

suggests improvements.

It differentiates a high performer from a lower performer.

3.4 PROCESS OF PERFORMANCE APPRAISAL

ESTABLISHING PERFORMANCE STANDARDS: The appraisal process

begins with the setting up of criteria to be used for appraising the performance of
employees. The criteria are specified with the help of job analysis, which reveals
the contents of job. This criteria should be clear, objective and in writing.

COMMUNICATING THE STANDARDS: The standards are conveyed to the

employees and the evaluators. A feedback regarding the standards should be
obtained from the evaluators and the employees for revision or modification.

MEASURING PERFORMANCE: This requires choosing the right technique of

measurement, identifying the internal and external factors influencing
performance and collecting information on results achieved.

38

COMPARING

THE

ACTUAL

WITH

THE

STANDARDS:

Actual

performance is compared with the predetermined performance standards. Such

comparison will reveal the deviation, which may be positive or negative.

DISCUSSING THE APPRAISAL: The results of the appraisal are

communicated to and discussed with the employees. Along with the deviations,
the reason behind them are also analyzed and discussed. Such discussion will
enable the employee to know his weaknesses and strengths.

TAKING CORRECTIVE ACTIONS: Through mutual discussions with

employees, the step required to improve performance are identified and initiated.
Training, coaching, counseling, etc., are examples of corrective actions that help
to improve performance.

3.5 METHODS OF PERFORMANCE APPRAISAL

Several methods and techniques are used for evaluating employee performance. These
may be classified in to Traditional and Modern methods.
TRADITIONAL METHODS

RANKING METHOD- is technique; evaluator assigns relative ranks to all

employees in the same work unit doing the same job. Employees are ranked from
the best to the poorest on the basis of overall performance. The relative passion of
an employee is reflected in the numerical rank. It is one of the simplest methods.
It is time saving and comparative evaluation technique of appraisal.

MAN-TO-MAN COMPARISON METHOD- In this method, certain factors are

selected for the purpose of analysis and the rater for each factor designs a scale. A
scale of man is also created for each selected for each factor. Then each man to be
rated is compared with the man in the scale, and certain scores are awarded to
him. In other words, a whole man is compared to a key man in respect of one
39

factor at a time. This method is used in job evaluation and is known as the factor
comparison method.

PAIRED COMPARISON METHOD - This is a modified form of man to man

ranking. Herein, each employee is compared with all others in pairs on at a time.
The number of times an employee is judged better then other determines his rank.
Comparison is made on the basis of overall performance.

FORCED DISTRIBUTION METHOD - In these techniques the rater appraises

an employee according to a pre-determined distribution scale. It is assumed that it
is desirable to rate only two factors by this method that is Job performance and
promo ability. For this purpose a five poking performance scale is used without
any descriptive statement& employees are placed between two extremes of good
and bad performance.

GRAPHIC RATING SCALES METHOD - It is a numerical scale indicating

different degrees of a particular train. The rater is given a printed form for each
employee to be rated. The form contains several characteristics relating to the
personality and performance of employee. Intelligence, attitude, quality of world,
leadership skills judgment, etc. are some use characteristics. This method is
widely used as it is easy to understand. It allows a statistical tabulation of scores
and, a ready comparison of scores among the employees is possible.

The

approach is multi-dimensional as several significant dimensions of the job can be

considered in evaluation.

CRITICAL INCIDENT METHOD - In this method the superior keeps a written

record or critical (either good or bad) events and how different employees
behaved during such events. The rating of the employee depends on the positive
or the negative behaviors during these events.
40

These critical incidents are

identified after through study of the job and discussions with the staff. This
method helps to avoid vague impressions and general remarks as the rating is
based on actual records of behavior.

GROUP APPRAISAL METHOD - Under this method, a group of evaluators

assess employees.

This group consists of the immediate supervisors of the

employee, other supervisors having close contact with the employers work, head
of the department and a personnel expert. The group determines the standards of
performance for the job, measures actual performance of an employee, analysis
the causes of poor performance and offers suggestions for improvements in future.

GRADING METHOD - under this method, the rater considers certain factors,
and marks them accordingly to a scale. The selected factor may be analytical
ability, co-operation, dependability self-expression, job knowledge. They may be
grades as A outstanding, B- very good, C-good/average, D-fair, E- poor.
The actual performance of an employee is then compared with these grade
definitions and he is allotted the grade which best described his performance.

CHECKLIST METHOD - In this method, series of questions are presented

concerning an employees behavior.

Here rater does not evaluate employee

performance; he supplies reports about it and the personnel department does the
final rating.

ESSAY METHOD - In this method, the supervisor makes a free form, openended appraisal of an employee in his own words and puts down his impression
about the employee. The description is always as factual and concrete as possible.

FIELD REVIEW METHOD - In this method, a trainer employee from the

personnel department interviews line supervisors to evaluate respective

41

subordinates. The supervisor is required to give his opinion about the progress of
his subordinates and his plan of action in cases requiring for consideration.
The traditional methods given above focus on the traits of an employee than an his
job performance , In the absence of predefined performance criteria or standards , the
personal bias or subjectivity of the evaluator affects the ratings . This approach caused the
following responses:

The very nature of the appraisal system led to criticism.

Criticism exercised a negative impact on goal attainment.

Criticism increased antagonism and defensiveness among employees resulting in

inferior performance.

Managers generally are not qualified to assess personality traits.

Some managers discourage good performances by over emphasizing shortcomings and

almost neglecting good work.
In order to overcome these weaknesses some new techniques of performances
appraisal have been developed.
MODERN METHODS

ASSESSMENT CENTER METHOD - An assessments center is a group

employee drawn from different work units. These employees work together on
assignments similar to the one they would be handlings when promoted. The most
important feature of the assessments center is job-related simulations. Evaluators
observe and rank the performances of all participants. This group evaluates all
employees are both individually and collectively by using simulations techniques
like role- playing, business games and in-basket exercises? Employees are
evaluated on the basis of job related characteristics considered important for job
success. The evaluators prepare a summary report and feedback is administered on
42

a face-to-face basis to the employees who ask for it. An assessment center
generally measures interpersonal skills, communicating ability to plan and
organize, etc. Assessments centers are not only methods of appraisal but help to
determine training and development needs of employees and provide data for
human resource planning.

HUMAN RESOURCE ACCOUNTING METHOD - Human resource are a

valuable asset for any organization. This asset can be valued in terms of money.
When competent and well-trained employees leave an organization the human
asset ids decreased and vice versa. Under this method performance is judged in
terms of costs and contributions of employees. Costs of human resources consist
of expenditure on human resource planning, recruitment, selection, induction,
training, compensation, etc. Contribution of human resources is the money value
of labor productivity or value added by human resources. Difference between
cost and contribution will reflect the performance of employees. This method is
still in the transitory stage and is, therefore, not popular at present.

BEHAVIORAL ANCHORED RATING SCALES (BARS) - This method

combines graphic rating with critical incidents method. BARS are descriptions of
various degrees of behavior relating to specific performance dimensions. Critical
areas of job performance and the most effective behavior for getting results are
determined in advance. The rater records the observable job behavior of an
employee and compares these observations with BARS. In this way an
employees actual behavior is judged against the desired behavior. This steps
involved are

43

IDENTIFY CRITICAL INCIDENTS - Persons with knowledge of the identify

job to be appraised describe specific examples of both effective and ineffective
job behaviors.

SELECT PERFORMANCE DIMENSIONS - The persons then cluster the

behavioral incidents into a smaller set (usually 5-10) of performance dimensions.

RETRANSLATE THE INCIDENTS - Another group of knowledgeable persons

assign each incident to the dimension that it best describes. Incidents for which
there is less than 75% agreement with the first group are not retranslated.

ASSIGN SCALES TO INCIDENTS - The second group rates each incident on a

7 or 9 point scale. Rating is done on the basis of how well the behavior described
in the incident represents the performance on the appropriate dimensions. Means
(average) and standards deviations are then calculated for the scale values
assigned to each incident.

DEVELOP FINAL INSTRUMENT - A subset of the incidents that meets both

the retranslation and standard deviation criteria is used as a behavioral anchor for
the final performance dimensions. A final BARS instrument typically comprises a
series of vertical scales that are endorsed by the include incidents. Each incident
is positioned on the scale according to its mean value.

360 DEGREES PERFORMANCE APPRAISAL

This is a new concept in performance appraisal, where the feedback is collected from
all around the employee, the superior, the subordinates, the peer group, and the customers.
The evaluation is very comprehensive in terms of the employees skills, abilities, styles, and
job-related competencies. This system has the following advantages are

Higher validity and reliability of the evaluation.

Self evaluation by the employees gets compared with the perception of others.
44

Helps in maximizing employee potential in the face of challenges.

ADVANTAGES

Ratings are likely to be accurate because these are done by experts.

The method is more reliable and valid as it is job specific and identified
observable and measurable behavior.

Ratings are likely to be more acceptable due to employee participation

The use of critical incidents is useful in providing feedback to the employee being
rated.

LIMITATIONS

It is very time consuming and expensive to develop BARS for every job.

Behaviors used are more activity oriented than results oriented.

APPRAISAL BY RESULTS OR MBO (MANAGEMENT BY OBJECTIVES)

The concept of management by objectives was developed by Peter Drucker in 1954.
Since then MBO has become an effective and operational technique of performance appraisal
and a powerful philosophy of managing.
MBO has been defined as a process whereby the superior and

subordinate

managers of an organization jointly identify its common goal, define each individuals major
areas of responsibility in terms of results expected of him and use these measures as guides
for operating the unit and assessing the contributions of each its members. In other words,
MBO involves appraisal of performance against clear, time bound and mutually agreed job
goals.
PROCESS OF MBO

SET ORGANIZATION GOALS - Goals of the organization in key areas of

performance are laid down. These goals are defined in clear, precise and

45

measurable terms. A thorough analysis of internal and external environment of

the organization is made to set these goals.

DEFINING PERFORMANCE TARGETS - On the basis of organizational

goals, performance standards for each employee are defined. Every subordinate
writes down his own performance goals, which are work related, and careeroriented. His manager also writes down the goals he thinks the subordinate
should strive for. The two then discuss them, reach an agreement and put the
agreed goals in writing. Thus, employees at all levels are involved in goal setting.
The goals are periodically reviewed and revised to keep them flexible and up-todate.

PERFORMANCE REVIEWS - Frequent performance reviews meetings

between manager and subordinate are held. In these meeting progress is assessed,
weaknesses and constrains are identified and steps to be taken to improve
performance are decided. Subordinates actively participate in this process. This
leads to self-control by the employee.

FEEDBACK - After every performance review feedback on performance is

communicated to the employee so that he can regulate and improve upon his own
performance. On the basis of performance review rewards are decided. New
goals and performance targets are determined for the next period.

ADVANTAGES

Ends means chain

Role clarity

Co-ordination

Objective appraisal

Motivation and commitment

46

Management development

LIMITATIONS

Difficulty in goal setting

Problem of participation

Lack of understanding

Time-consuming and expensive

Inflexibility

SHORT COMINGS OF PERFORMANCE APPRAISAL

The ideal approach to performance evaluation is that in which the evaluator is free
from personal biases, prejudices, and idiosyncrasies. This is because when an evaluation is
objective, it minimizes the dysfunctional behavioral of the evaluator, which may be
detrimental to the achievement of organizational goals. The factors which impede objective
evaluations are:
THE HALLOW EFFECT - The halo effect is a tendency to let the assessment of an
individual one trait influence the evaluation of that person on other specific traits. There is
this effect in appraisal when the appraiser assigns the same rating to all traits regardless of an
employees actual performance on these traits.
The halo effect refers to the tendency to rate an individual consistently high or low or average
on the various traits, depending upon whether the raters overall impression of the individual
is favorable or not. This means that the halo effect allows one characteristic, or occurrence
(either good or bad) to influence the rating of all performance factors.
The halo effect problem can be alleviated by

Providing a training programmer to the evaluators.

Restructuring the questions by requiring the evaluator to consider each question

independently.
47

LENIENCY OR STRICTNESS TENDENCY - Every evaluator has his own value system
which acts as a standard against which he makes his appraisals. Relative to the true or actual
performance an individual exhibits, some supervisors have a tendency to be liberal in their
rating, that is they consistently assign high values to their employees, while at other times
they may have a tendency to assign consistently low rating.
The former tendency is known as positive leniency error, while the latter
negative leniency error.

as

Both these trends usually arise from varying standards of

performance observed by supervisors and from different interpretations of what they evaluate
in employee performance. The tendency can be avoided by holding meeting or training
sessions for raters so that they may understand what is requ9red of them in rating.
THE CENTRAL TENDENCY PROBLEM - It is the most commonly found error. It
assigns average ratings to all the employees with a view to avoiding commitment or
involvement; or when the rater is in doubt or has inadequate information or lack of
knowledge about the behavior of the employee, or when he does not have much time at his
disposal. The ranking tools discussed earlier are aimed at avoiding this problem.
SIMILARITY ERROR - This type of error occurs when the evaluator rates other people in
the same way he perceives himself.

This error also washes out if the same evaluator

appraises all the people in the organization.

MISCELLANEOUS BIASES - Bias against employees on ground of sex, race religion or
position is also a common error in rating. For example, a higher rating may be given to a
senior employee. The rater may also be influenced by organizational influence and give
higher rating to those holding higher positions.
SOCIAL DIFFERENTIATION - Rating is sometimes impeded by the evaluators style of
behavior. Pious has classified raters as high differentiations- that is using most of the scale;
or low differentiators-that is, using a limited range of the scale. Low differentiators tend to

48

ignore or suppress differences, perceiving the universe as more uniform than it really is High
differentiators, on the other hand, tend to utilize all available information to the utmost extent
and thus are better able to perceptually deny anomalies and contradictions than low
differentiators. Social differentiation makes evaluations using trait criteria unreliable.
SPILL-OVER EFFECT - This type of error occurs when past performance rating influences
the current rating.
STEPS FOR MAKING APPRAISAL SUCCESSFUL

Existence of an atmosphere of confidence and trust.

The results of performance rather than personality traits should be given due
weight.

The supervisor should analyze the strengths and weaknesses of the employee and
advise him.

The appraisal programmed should be less time-consuming and less costly

The results of appraisal should be immediately communicated to the employee.

A post appraisal interview should be arranged.

Training can be used to improve the standards of performance appraisal.

The right appraisal tools should be chosen to minimize arising problem.

CHARACTERISTICS OF APPRAISAL SYSTEM

RELIABILITY AND VALIDITY
Appraisal system should provide consistent, reliable and valid information and data, which
can be used to defend the organization-even in legal challenges. If two appraisers are equally
qualified and competent to appraise an employee with the help of same appraisal technique,
their ratings should agree with each other. Then the technique satisfies the condition of
validity be measuring what they are supposed to measure. For example, if appraisal is made

49

for potential of an employee to take up higher responsibly and carry on activities at higher
level.
JOB RELATEDNESS
The appraisal technique should measure the performance and provide information in
job related activities or areas.
STANDARDIZATION
Appraisal forms, procedures, administration of techniques, ratings etc., should be
standardized as appraisal decision affect all employees of the group.
PRACTICAL VIABILITY
The techniques should be practically viable to administer, possible to implement and
economical regarding cost aspect.
TRAINING AND APPRAISERS
Because appraisal is important and sometimes difficult, it would be useful to provide
training to appraise viz., some insights and ideas on rating, documenting appraisals, and
conducting appraisal interviews. Familiarity with rating errors can improve rater performance
and this may inject the need confidence in appraisers to look into performance ratings more
objectively.
OPEN COMMUNICATION
Most employees want to know how well they are performing on the job. A good
appraisal system provides the needed feedback on continuing goals. The appraisal interviews
should permit both parties to learn about explain their performance expectations to their
subordinates in advance of the appraisal period. Once this is known if becomes easy for
employees to learn about the yardsticks and if possible try to improve their performance in
future.

50

EMPLOYEE ASSETS TO RESULTS

Employees should know the rules of the game. They should receive adequate
feedback on their performance, then withholding appraisal results would not serve any
purpose. Employees simply could not perform better without having access to this
information. Permitting employees to review the results of their allows them to detect any
errors that may have been made. If they degrees with the evaluation, they can even challenge
the same through formal channels.
POSSIBLE PITFALLS OF THE SYSTEM
The system may not be successful all time. Sometimes it may have the following pitfalls:

Halo effect- Any one quality of the appraise like personality/appearance affecting
the appraisal.

Central Tendency- giving a rating of average to all.

Strictness Error- Being unnaturally strict in ones evaluation.

Leniency Error- Tendency to be liberal to all.

Regency Effect- A recent most incident tremendously influencing an individual

rating.

Spill-over Effect- Past rating of an employee influencing his present appraisal.

Logical Rating Error- Higher score on one quality leads to a still higher score on
another.

Similarity Rating Error: Seeing whether a quality exists or not.

Giving the higher rating to those who make themselves visible.

Biases, stereotype and prejudice getting into appraisal. There is often a tendency
to rate not only the emp0loyee but also the job.

51

3.6 PERFORMANCE APPRAISAL SYSTEM IN NAGARJUNA AGRICHEM

LIMITED
INTRODUCTION
Organization are run and steered by people that goals are set and objectives realized.
The success of an organization is thus depends upon the sum total of performance of its
members. A well designed and a well implement performance appraisal system adds value to
the organization. The appraisal should be based on contribution made by an individual in the
accomplishment of organizational objectives. Performance can be measured by some
combination of quantity, quality, time and cost.
Performance appraisal refers to all those procedures that are used to evaluate the
personality, the performance and the potential of its group members. This process of HPD
helps the employees to acquire and/or develop technical, managerial and behavioral
knowledge, skills and abilities that are necessary to perform present and future roles.
Performance appraisal indicates the level of desired performance and the level of actual
performance and the gap between these two. This gap should be dredged through human
resource techniques like training, executive development etc.
PERFORMANCE APPRAISAL SYSTEM IN NAGARJUNA AGRICHEM LIMITED
The total employees of Nagarjuna Agrichem Limited is divided into two categories i.e.

Executive

Non-Executive (commercial/technical staff)

EXECUTIVE
For executive cadres appraisal system is performance management system.
This system is for executives only.
NON-EXECUTIVE

For non-executive performance appraisal system is Grading Method.

52

For permanent employees the appraisal was conducted in May and June of
every year by the immediate superior.

For probationary employees every 02 months they conduct or review the appraisal
by the immediate superiors.

For management trainers for every four months appraisal conducted by the group
of appraisers.

THE PURPOSE OF APPRAISAL IN NAGARJUNA AGRICHEM LIMITED

Identify the appraisers strengths and areas where he needs to improve and to
discuss these aspects in a post appraisal interview to help him improve his over all
performance in the present job.

Assist in identifying the training needs of the appraise for performance in the
present job and to prepare him for higher responsibilities.

Improve the channel of communication between the subordinates and superior.

Assist in deciding on career growth of appraisee.

GUIDE LINES FOR PERFORMANCE APPRAISAL

The assessment should be made by the immediate superior and reviewed by the
superiors basis.

The performance during the preceding 12th months or the period the appraisee was
under your supervision is required to be assessed against the factors listed.

Evaluate how well the appraisee had achieved the expected results for the period
under amendment.

Your assessment should be based on sufficient evidence reflected during the

review period. Try to make the appraisee as fair and accurate as possible.

Appraisee each factor independently not influenced by the rating of other factors.

53

They make sure that they evaluate the performance during the course of the entire
view period, and not make the out repeated error of being influence by the most
recent event.

THE SCALE ON WHICH THE PERFORMANCE IS TO BE APPRAISED IS

EXPLAINED BELOW
OUTSTANDING

Exceptional contribution well in excess of job

Requirements rarely achieved by others.

SUPERIOR

Exceeds normal job requirements definite growth

Potential.

GOOD

A good normal job requirement has growth potential.

NORMAL

Effective discharge of all responsibilities to full

Satisfaction Of superior.

BELOW NORMAL

Does not meet minimum requirements of job, must

Improve substantially.

The superior conducts the appraisal basing on the following factors/attributes

Job knowledge/skill, understanding of all phases of his work and related matters.

Application close through and attention of his work.

Work output consistent volume of acceptable work produced with the time
schedules.

Quality of work thoroughness neatness, accuracy and general excellence of work.

Initiative ability to originate or develop ideas and to get things started.

Inter personal relationship ability to get along with colleagues i.e., sincerity,
conduct and courtesy,

Dependability reliability in following entrusted assignment and instructions.

54

Attendance and punctuality; productive utilization of working hours, nature of

absenteeism.

Appreciation conformity to company policies attitude and commitment toward

company policies and programmes.

In these above matters the superior has to frame his choice according to
performance during preceding 12 months. By the superior may disclose that
strengths and weakness of appraises.

FLOW CHART INDICATES THE PROCESS OF PERFORMANCE APPRAISAL

SYSTEM IN NAGRAJUNA AGRI CHEM LIMITED:

DEFINE OBJECTIVES AND NORMS OF PERFORMANCE APPRAISAL

The first basic step in effective and systematic appraisal system is to define the
objectives / purpose of the performance appraisal system.

55

Nagarjuna Agrichem Limited uses printed appraisal forms for the purpose of
performance appraisal system to evaluate the performance of an employee.

The form

contains objectives, standards/ norms and various attributes/ factors. The appraisal system in
Nagarjuna Agrichem Limited is very clear. The method used for appraisal is called Grading
Method.
The appraisal standards serve as bench marks against which performance is measured.
The main objectives of performance appraisal system is to identify the appraisee Strengths,
weakness, assessing training needs, improving superior

subordinate relations and

communications etc.
The appraisal form contains one scale and it may be definitional like outstanding,
superior, good, and normal, below normal. The actual performance of the employees is
measured against these grades.
SET APPRAISAL FACTORS/ATTRIBUTES
The assessment done one the basis of certain attributes/ factors which help in define
job requirements of a particular job. Such as job knowledge/ skill, attention of work, work
output, quality of work initiative e, inter personal relationship, dependability, attendance and
punctuality, appreciation/ conformity to company policies, house keeping and safety,
accepting responsibilities positive discipline etc.
The company considers 10 factors for permanent employees and 12 factors for
executive trainees and probationary employees, 9 factors for trainees. Job performance
included quality and quantity of work performance, responsibility assumed specific targets
achieved regularity of attendance etc.
FILLING NECESSARY DETAILS OF THE EMPLOYEE
The Human Potential Development (HPD) in Nagarjuna Agrichem limited fills the
necessary details of the each and every category employees in the appraisal forms at the start

56

of the appraisal period. This is called BACKGROUND information, and it contains name
of the employee, employee number, date of joining, department, designation, period of
appraisal, date of appraisal.
SENDING APPRAISAL FORMS
The Human Potential Development department sends those filled appraisal forms to
the concerned departments Head of departments, and then Head of the department gives
ample

of time to the superiors for appraisal. The period of appraisal is different for

commercial/technical staff, trainees, and probationary employees.

Annual appraisals are sent to all commercial/technical staff once in a year, for trainees
appraisals are once in three months. Once training gets over the individual enter the
probationary period which is for six months. During probationary period appraisal are sent
once in 2 months.
IMPLEMENTING APPRAISAL PROGRAMME
It is the most important step in appraisal programme. The appraisal programme
should be made by the immediate superior and reviewed by the superior boss. The superior
appraises the performance of the employee on the bases of certain norms and factors. After
rating the various attributes of appraise the appraisal will give remarks. The appraiser also
writes the strengths, weakness, and areas where the employee needs to improve. Finally the
superior give overall assessment.
APPRAISAL FEEDBACK
Perhaps appraisal feedback is the most crucial stage in appraisal programme. In this
step the appraiser discussed with the appraisee regarding his performance during the period
under review, highlighting his areas of major strengths, weakness so as to help him to make
improve. After the discussion with the employee the superior give suggestions for improving

57

of the employee performance. Finally the superior takes signature of the employee on the
form.
POST APPRAISAL ACTION
This is the last step in performance appraisal system in Nagarjuna Agrichem Limited.
Performance appraisal is not an end in itself but it is a means for long term performance of
personnel by taking appropriate actions based on the information as revealed by the appraisal.
The action may be in the form of giving suitable rewards for outstanding performance,
promotions, providing training for better performance etc. The appraisal for trainees is for
conformation only.

58

1. What do you feel about perf

performance
ormance appraisal system in the Nagarjuna
Agrichem limited is?
S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

EXCELLENT

14

14

GOOD

74

74

NORMAL

12

12

TOTAL

100

100

80

74

70
60
50
40
30
20

14

12

10
0
EXCELLENT

GOOD

NORMAL

Interpretation:
From the above data, it is observed that most of the respondents i.e.74 percentage
agreed that performance appraisal system in Nagarjuna Agrichem Limited is good and 14
percentage agreed that performance appraisal system is excellent. Only 12 percentage said
that the system is in normal position.

59

2. What is the periodicity of performance appraisal

appraisal?
S.NO

VARIABLES

NO.OF RESPONDENTS

PERCENTAGE

TWO MONTHS

QUARTERLY

72

72

HALF YEARLY

15

15

YEARLY

100

100

TOTAL

80

72
70
60
50
40
30
20

15

10

0
Two Months

Quarterly

Half Yearly

Yearly

Interpretation:
From the above data it can be interpreted that 72 percentage of respondents responded
that they are quarterly appraised.15 percentage as half yearly appraised.8 percentage as yearly
appraised.. In the Ngarjuna Agrichem limited based on the departments time to time they are
appraised.

60

3. By whom you are appraised in organization?

S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

SUPERIOR

88

88

PEER GROUP

SELF

GROUP OF APPRAISERS

12

12

100

100

TOTAL

100

88

90
80
70
60
50
40
30
20

10

PEER GROUP

SELF

0
SUPERIOR

GROUP OF APPRAISERS

Interpretation:
As per the above data interpreted shows that 88 percentage of employees
employee agreed that
they appraised by their superiors.12 percentage of employees appraised by group of
appraisers.

61

4. In your opinion what is the objective/purpose of Performance Appraisal?

S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

TRAINING

20

20

PROMOTIONS

60

60

TRANSFERS

INCREMENTS

10

10

ALL THE ABOVE

10

10

TOTAL

100

100

70

60
60
50
40
30

20
20

10

10

INCREMENTS

ALL THE ABOVE

10

0
0
TRAINING

PROMOTIONS

TRANSFERS

Interpretation:
It can be interpreted from the above data that the opinion of maximum number of
respondents i.e. 60 percentage feel tthat performance appraisal objective is promotions and 20
percentage is training.

62

5. The rate of implementation of Per

Performance
formance Appraisal System in
Nagarjuna agrichem limited
limited?
S. NO

VARIABLES

NO.OF RESPONDENTS

PERCENTAGE

EXCELLENT

GOOD

74

74

AVERAGE

20

20

TOTAL

100

100

80

74

70
60
50
40
30
20
20
10

0
EXCELLENT

GOOD

AVERAGE

Interpretation:
From the above data clearly reveals that 74 percentage of employees viewed that the
rate of

implementation of performance appraisal system is good and 20 percentage of

employees agreed
greed that performance appraisal system is average.

63

6. Are any Monetary & Non

Non-Monetary
Monetary benefits given for outstanding

performance?
S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

YES

25

25

NO

60

60

SOME TIMES

15

15

100

100

TOTAL

70

60
60
50
40
30

25

20

15

10
0
YES

NO

SOMETIMES

Interpretation:
From the above data it can be interpreted that about 60 percentage of employees
responded that, the organization does not give monetary and non
non-monetary
monetary benefits for
outstanding performance.

64

7. Do you
u feel the present performance appraisal system is more
transparent?
S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

AGREE

30

30

PARTIALLY AGREE

14

14

DISAGREE

56

56

100

100

TOTAL

60

56

50

40

30
30

20

14
10

0
AGREE

PARTIALLY AGREE

DISAGREE

Interpretation:
From the above data it can be interpreted that majority of respondents i.e. 56
percentage disagreed that the performance appraisal system is more transparent in Nagarjuna
Agrichem limited. 30 percentage of employees agreed the performance appraisal system is
more transparent.

65

8. Does your Organization give feedback to you about your performance at

the end of the year?

S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

YES

51

51

NO

26

26

SOME TIMES

23

23

TOTAL

100

100

60

51
50

40

30

26

23

20

10

0
YES

NO

SOMETIMES

Interpretation:
The opinions of maximum number of employees i.e.51 percentage of employees are said
that their superiors give feedback about their strengths, weaknesses and areas that they needs
to improve.

66

9. Do you agree that your superior appreciate and encourage your work?
S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

AGREE

10

10

PARTIALLY AGREE

56

56

DISAGREE

34

34

100

100

TOTAL

60

56

50

40

34
30

20

10
10

0
AGREE

PARTIALLY AGREE

DISAGREE

Interpretation:
From the above data it is clear that as much as 56 percentages of employees are
partially agreed that their superiors appreciated and encouraged their work. 34 percentages of
employees are disagreed.

67

10. Do you agree that the performance appraisal updates your training
needs from time to time?

S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

AGREE

18

18

PARTIALLY AGREE

72

72

DISAGREE

10

10

TOTAL

100

100

80

72
70
60
50
40
30
20

18
10

10
0
AGREE

PARTIALLY AGREE

DISAGREE

Interpretation:
The table shows that 72 percentage of employees are partially agreed that the
performance appraisal updates their training needs from time to time and 18 percentage of
employees totally agreed.

68

11. Do you agree that promotions are based on performance?

S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

AGREE

12

12

PARTIALY AGREE

80

80

DISAGREE

100

100

TOTAL

90

80
80
70
60
50
40
30
20

12

10
0
AGREE

PARTIALLY AGREE

DISAGREE

Interpretation:
Out of 100 percentage respondents, 80 percentage of employees are partially agreed
that their promotions are based on th
their performance.12 percentage of employees are agreed.

69

12. What is the level of satisfaction with existing Performance Appraisal

System?

S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

SATISFIED

30

30

PARTIALLY
SATISFIED

62

62

NOT SATISFIED

100

100

TOTAL

70

62
60
50
40

30
30
20

10
0
SATISIFIED

PARTIALLY SATISIFIED

NOT SATISIFIED

Interpretation:
The above table shows that majority of respondents i.e.62 percentage are partially
satisfied with existing performance appraisal system and 30 percentage of employees
satisfied.

70

13. Is there any scope for grievance redressal, if performance appraisal is

not done in fair?
S.NO

VARIABLES

NO.OF RESPONDENTS

PERCENTAGE

YES

56

NO

25

25

SOMETIMES

19

19

TOTAL

100

100

70

62
60
50
40

30
30
20

10
0
SATISIFIED

PARTIALLY SATISIFIED

NOT SATISIFIED

Interpretation:
Out of 100 percentage respondents, the majority of employees i.e.56 percentage is
thinking that there is a scope for grievance redressal if performance appraisal is not done in
fair.25 percentage of employees
yees are not agreed that
that.

71

14. Are you motivated by the present Performance Appraisal System?

S.NO

NO.OF

VARIABLES

RESPONDENTS

PERCENTAGE

YES

48

48

NO

19

19

SOME TIMES

33

33

TOTAL

100

100

60

50

48

40

33
30

19

20

10

0
YES

NO

SOMETIMES

Interpretation:
The above table depicted that majority of employees i.e.48 percentage are motivated
by the present performance appraisal system and 33 percentage of employees agreed that
sometimes their motivated by the present performance appraisal system.

72

15. Do you get congenial work environment for achieving the highest
Performance?

VARIABLES

S.NO

NO.OF
RESPONDENTS

PERCENTAGE

AGREE

40

40

PARTIALLY AGREE

56

56

DISAGREE

100

100

TOTAL

60

56

50

40
40

30

20

10

4
0
AGREE

PARTIALLY AGREE

DISAGREE

Interpretation:
The above table shows that 56 percentage of employees
oyees partially agreed that
Nagarjuna Agrichem limited provides congenial work environment for achieving the highest
performance.40 percentage of employees agreed to this.

73

16. Do you agree that p

present
resent Performance Appraisal System helps in
achieving organization goals?

S.NO

VARIABLES

NO.OF
RESPONDENTS

PERCENTAGE

AGREE

37

37

PARTIALLY AGREE

59

59

DISAGREE

100

100

TOTAL

70

59

60
50
40

37

30
20
10

0
AGREE

PARTIALLY AGREE

DISAGREE

Interpretation:
The table shows that 59 percentage of employees are partially agree that present
performance appraisal system helps in achieving organization goals. 37 percentage of
employees agreed to this.

74

17. Will the performance appraisal system encourage people to plan their
work well in advance?

S.NO

VARIABLES

NO.OF
NRESPONDENTS

PERCENTAGE

AGREE

38

38

PARTIALLY AGREE

56

56

DISAGREE

100

100

TOTAL

60

56

50

40

38

30

20

10

0
AGREE

PARTIALLY AGREE

DISAGREE

Interpretation:
56 percentage of employ
employees
ees partially agreed that performance appraisal

system

encourage people to plan their work well in advance and 38 percentage of employees agreed
to this.

75

18. Opinion of Respondents on 360 degree appraisal method which is to be

implemented in their organization?
nization?

VARIABLES

S.NO

NO.OF
RESPONDENTS

PERCENTAGE

AGREE

60

60

PARTIALLY AGREE

30

30

DISAGREE

10

10

TOTAL

100

100

70

60
60
50
40

30
30
20

10
10
0
AGREE

PARTIALLY AGREE

DISAGREE

Interpretation:
From the above data 60 percentage of respondents opinion that 360 degree appr
appraisal
method is followed in their organization effectively and 30 percentage of employees partially
agreed and 10 percentage of employees are disagreed
disagreed.

76

5.1 SUMMARY
The project entitled Performance appraisal system in Nagarjuna Agrichem limited,
Srikakulam which was carried out by me consists of five chapters i.e. introduction,
organizational overview, topic specification i.e. performance appraisal system in Nagarjuna
Agrichem limited and summary and suggestions.
Performance appraisal is the process of assessing performance and progress of
employee or of a group of employee on a given job and his potential for future development.
It is a type of structured interaction between a subordinate and supervisor that usually takes
the form of a periodic interview, in which the work performance of the subordinate is
examined and discussed, with a view to identifying weakness and strengths as well as
opportunities for improvements and skills development.
The first chapter deals with Introduction of the topic need for the study, objectives,
methodologies scope and limitations. The study was based on both primary and secondary
data. Primary data was collected through observation method. Secondary data was collected
from annual reports, policy guidelines, and books. However time factor, employee bias are
the main limitations of the study.
In the second chapter consists of organizational overview- its profile, organization
structure genesis and its functional departments details. The Nagarjuna group has found in
1973 by Sri K.V.K.Raju with investment of US$23 million. In 1985 group with focus on
agricultural input business and 1992 forayed into the crop protection business with
investment in pesticides formulating manufacturing in the NACL there are 800 employees.
500 employees are permanent and 300 contract employees are worked. Overview of
Nagarjuna Agrichem Limited, organization structure and various functional departments. The
organization structure includes various functional departments headed by Managing Director

77

and functional departments are, Accounts Departments, Production Department and

Personnel Department headed by Managers.
The chapter three deals with theoretical background of Performance Appraisal
system which includes introduction, definitions, needs Performance Appraisal system,
objectives of Performance Appraisal system, methods Performance Appraisal system, process
of Performance Appraisal system, problems of Performance Appraisal system.
The Performance Appraisal system process is a complex mixture of activities intended
to improve the performance of individuals and groups within the organization. Human
resources departments are performing activates central to the ongoing health and vitality of
organizations. The organization structure includes various functional department headed by
managing director and functional department are, accounts department, sales department,
production department, transport department and personnel department headed by managers.
The fourth chapter contains the Data Analysis and Interpretation are as follows of the
company. The following suggestions were given in the fifth chapter based on that findings
and conclusions.
The fifth chapter contains summary, findings, suggestions, and conclusion.
Appraisal is the evolution of worth, quality or merit. In the organization context,
performance appraisal is a systematic evaluation of personnel by superiors or others familiar
with their performance. Performance appraisal is also described as merit rating in which one
individual is ranked as better or worse in comparison to others. The basic purpose in this
merit ranking is to ascertain an employee's eligibility for promotion.
As per the observations in the organization and interaction with various working
employee and the management personnel, it is concluded in this way. Employee
performance appraisal should follow in Nagarjuna Agrichem Limited as it was prevailing

78

earlier i.e. systematic assessment of how well the employee is performing their jobs in
relation to established standards and the communication of that assessment to employee.
From research done on performance appraisal system of the organization it has been
found out that the system is successfully helping the organization to improve the
performance of employee as well as it is helping in the development of future career goals.
Majority of them agreed that appraisal system is helping them to develop their career goals.

79

5.2 FINDINGS

Maximum number of Employees agreed that performance appraisal system in

Nagarjuna Agrichem Limited is good.

More percentage of employees responded that they are quarterly appraised. There
is a department wise performance appraisal system.

Higher rate of respondents viewed that the superiors as their appraiser.

More than half of employees feel that performance appraisal purpose/objective is

for promotions.

Mostly three fourth of employees viewed that the rate of implementation of

performance appraisal system is good.

More than half of percentage of employees responded that organization does not
give monetary and non-monetary benefits for outstanding performance.

Mostly more than half of percentage of employees not agreed that the
performance appraisal is more transparent.

More than half of the employees are said that their superiors give feedback about
their strengths, weakness and areas that they needs to improve.

So many Employees partially agreed that their superiors appreciated and

encourage their work.

Three fourth of employees agreed that the performance appraisal updates their
training needs from time to time.

More than sixty percentage of employees satisfied with existing performance

appraisal system.

Fifty six percentage of employees are thinking that there is a scope for grievance
redressal if performance appraisal is not done in fair.

80

Half of the percentage of employees are motivated by the present performance

appraisal system. Performance appraisal is directly linked with career growth
opportunity.

More than half of employees agreed that Nagarjuna Agri Chem Limited provides
congenial work environment for achieving the highest performance.

More than half percentage of the respondents opined that 3600 degree appraisal
system must be implemented to have effective performance appraisal system in
the organization.

5.3 SUGGESTIONS
A Sample of 100 respondents were selected at random from different departments of
the employees from the staff to middle level management were sort for their opinions on the
existing appraisal system.
A survey was conducted by me (by way of questionnaire and interview) to find out
whether the employees are satisfied with the existing system and their opinions on rated
areas.

Time schedule for formation and evaluation of performance appraisal should be

maintained strictly.

Employees should be made aware of the performance appraisal in Nagarjuna Agri

chem Limited.

Appreciation for good performance and proper guidance for improvement is a

must.

The performance appraisal system must be more transparent to the employees.

As the appraisal is directly linked to promotions or career progressions of an

employee there should be transparency in discussing the appraisal report.
81

Objective and fair assessment can induce seriousness towards appraisal and help
increase motivation among employees.

82

BIBLIOGRAPHY
BOOKS :

ARUN MONAPPA PERSONNEL MANAGEMENT, Tata Mc Graw-Hill.

V S P RAO and P.S NARAYANA

MANAGEMENT, Premier Book

Company, New Delhi.

HUMAN

ASWATHAPPAs

RESOURCE

AND

PERSONNEL

MANAGEMENT , Tata Mc Graw-Hill.

P.SUBBA RAOs HUMAN RESOURCE MANAGEMENT AND INDUSTRIAL

RELATIONS, Himalaya Publishing House.

-----

C.B.MAMORIA
ANNUAL REPORTS

-----

Personnel Management
Nagarjuna Agrichem Limited

Information collected from the records of HR department of Nagarjuna Agrichem

Limited.
WEB SITES:

www.performance management.com

www.nagajunagroup.com

www.nacl.co.in

83