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“A Study on employee perception towards performance

appraisal system in information technology industry.”
Abstract:-
In this study of employee perception towards performance appraisal system in information technology
industry, we have study the employee’s perception and their opinion about their current appraisal system
of their organization, GS Lab Pvt Ltd, Pune.

The employees in the organization are directly interviewed and related data’s where collected through the
questionnaire. The data’s are analyzed through the percentage analysis and chi-square method. From
these inference were drawn, based on the inference it is found that most of the respondents fells that the
performance appraisal system done by the organization is comfortable and satisfactory. From the study it
is found that they are enriching their knowledge with appraisal system and necessary findings are made
and suggestions were given.

And after all the data and interpretation it has been found that maximum employees are satisfied
with the current appraisal system of their organization and have no other drawbacks. Is suggested
that the company should introduce new methods to provide good services promptly and efficiently at the
time of employees’ measures. Thus the study is mainly focus on performance of the employee among
executives, and their opinion efficiently and effectively.

Efforts by-
Afrin Naikwadi
Shahdab Sagari

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INDEX

CHAPTER
TOPICS PAGE NO.
No.

INTRODUCTION OF THE STUDY

 Introduction to topic
 Meaning & Definition
(I)  Significance of appraisal 3-5
 Introduction to Company
 Introduction to Industry

(II)  Literature Review 6-7

RESEARCH METHODOLOGY
 Objective of Study
 Limitation of Study
(III)  Scope of Study 7-8
 Tools and Techniques/ Hypothesis
 Research Design

DATA ANALYSIS AND INTERPRETATION

(IV)  Data and Tabulation 9-14
 Hypothesis Testing(Chi Square test)

(V) FINDINGS AND OBSERVATION 15-16

(VI) CONCLUSION 16-17

BIBLIOGRAPHY 17-18

ANNEXURE 18-19

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1. Introduction-
1.1 Introduction to topic
Performance appraisal iscomposed of two words: Performance & Appraisal. Performance indicates how
the management of an enterprise has been accomplishing the goals, which they had been set for the
enterprise. Performance is a measure of the degree to which organization fulfill its purpose. And the
purpose is to achieve its objectives.

Sometime despite repetitive & complex training and educational programmers been carried out frequently
for the employees the required performance is not achieved as most of the development take place on job
itself & therefore the performance of work force has to properly supervised and monitored. This is where
performance appraisal plays crucial role of comparing the standard performance with actual performance.
Thus it help supervisor identify area of short fall in performance of the work force & suggest way to
improve performance.

Performance appraisal is a means of evaluating the organization human resources qualitatively and
quantitatively in regard to aspect of job performance. It does not include effort but it always measure in
term of result. Albeit organization carried out various formal and informal method of appraising its
employees, its contribution to the organization overall performance decided how effective the
performance system works.

Most managers feel that the traditional appraisals don’t really improve the performance of employees; it
neither motivates nor guides their development. But usually it causes conflicts between superior and
subordinates and leads to dissatisfaction on the job and towards the organization. The outcome of the
entire exercise and questioned when the trait measure is of personal nature like – honesty, integrity, co-
operation etc. Furthermore some argue about dumping the entire appraisal on the grounds that, if a
company is a system of integrated parts, then an employee’s performance is more a function of factors
like training, communication tools& supervision than his or her motivation. Bear in mind all these
criticisms, managers still need some way to review subordinates work related behavior.

Performance appraisal system should be designed such that it should help employees to conspicuously
understand their role and functions. It should help identify employee’s strength & weaknesses and
recognize his/her developmental needs. It ought to be instrumental in increasing communication and trust
between superior and subordinates to get know the expectations and trust between superior and
subordinates to get to know the expectation and difficulties arising therefore so that a joint effort to
accomplish task will be formulated. A positive and healthy climate in the organization also drives people
to put in their best efforts. The opportunity for every employee should be worked out by generating data
about each employee periodically this will help identify the employee whose performance is outstanding
& further motivating them to perform better by way of rewards. The employees can also be prepared for
higher level jobs & the values, norms and culture of organization and further motivating them to perform
better by way of rewards. The employees can be prepared for higher level jobs and values, norms and
culture of the organization can be included to enforce work behavior and commitment to the organization.
The study tries to highlights some of the key aspects, which should be taken into consideration for
conducting purposeful performance appraisal.

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1.2 Meaning and definition:-

The performance appraisal is method of evaluating the behavior of employees at the work spot, normally
including both the quantitativeand qualitative aspect of the job performance. Performance here refers of
the degree of accomplishment of the task that makes up individual jobs. It indicates how well an
individual fulfilling the job demand often the term is confuse with efforts, but performance is always
measured in term of result and not effort. In order to find out whether an employee is worthy of continued
employment or not and if so whether he should receive bonus, a pay rise or promotion, his performance
needs to be evaluated from time to time.

1.3 Significance of Performance Appraisal:-

 It identifies the needs and areas for further training.
 It serves to guide employee development.
 It also serves to maintain fair relationship in group.
 It provides information in making about promotions, pay increases, transfer, termination etc.
 It infuses confidence among employees.
 It makes the compensation plans more scientific and rational.
 It puts psychological pressure on people to improve performance on the job.
 It provides useful information to superior/manager.

1.4 Introduction to Company:-

GS Lab works with customers building innovative products and services, helping them nurture their
ideas, staying with them during market validation and scaling them into viable businesses. Our deep and
varied technology expertise, complemented by a customer-centric engagement model helps our customers
craft solutions for critical business and technological challenges. We are a partner to our customers,
sharing their vision while mitigating their risks.

Our passion for solving complex problems through technology solutions makes us the preferred
technology partner of choice for achieving new thresholds of business performance.

GS Group is a South Korean conglomerate. GS comprises GS Holdings, subsidiaries & affiliates

including GS Caltex, GS Retail, GS Shop, GS EPS, GS Global, GS Sports and GS E&C among others.
The asset size is at 31.1 trillion KRW as the end of 2007 placing GS at the 6th largest in Korea excluding
the public business companies.

GS Holdings was incorporated in 2004[1] and officially split from LG Group in 2005, with the Koo family
gaining full control over LG Group and the Huh family creating GS Holdings.

In December 2005, the company acquired 70% of the shares of GS EPS Co., Ltd. (formerly LG Energy
Co., Ltd.) from GS E&C Corporation and LG International Corp.

The Koo family retained control of the LG Group while the Huh family formed GS Holdings.
Convenience stores and other retail companies which formerly operated under the LG logo were
rebranded as "GS", which, like "LG", comes from the old name, Lucky-Gold star.

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Subsidiaries

 The subsidiaries of GS Holdings are as follows:-

 GS E&C
 GS Energy
 GS Caltex the second-largest Korean refiner is owned equally by GS Holdings Corp. and
Chevron Corporation, the second-largest U.S. oil company.
 Haeyang City Gas - distributor of natural gas
 GS Mbiz
 AMCO
 GS Park24
 GS EcoMeta
 GS Power
 GS Entec
 Seorabol City Gas
 GS Platech
 GS Nanotech
 GS FuelCell
 GS Sports
o FC Seoul
o GS Caltex Seoul KIXX
 SamilPolymer
 PCT
 DeajungEM
 Sal de Vida Korea

1.5 Introduction to Industry:-

Over the past decade, the Information Technology (IT) industry has become one of the fastest growing
industries in India because of which it has caught world attention. Indian IT-ITES industry grew at a rate
of 33 % in FY2008. India is now being identified as powerhouse for incremental development of
computer software. It has grown from USD 4 billion industry to USD 58.8 billion industry in FY2008-09
employing over 2 million people. IT-BPO Industry has become growth engine for the economy
contributing substantially to increases in GDP, urban employment and exports to achieve vision of ‘young
and resilient India’.

Although domestic market is growing in India but still the major propellers of growth are exports. The
key segments that have contributed significantly to industry’s exports include-Software and services (IT
services) and IT enabled services. In the face of current recession though the mood is that of cautious
optimism but Industry is expected to witness sustainable growth over period of two years. But at the same
time while industry has significant headroom for growth ,as the competition is increasing with China
emerging as major threat ,all the stakeholders of Indian IT industry must give concentrated efforts to
ensure that India realizes its potential and maintains its leadership position in future also.

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2. Literature Review:-
ALFORD AND BEATTY says, "It is the evaluation or appraisal of the relative worth to the company of
a man's service on the job". FLIPPER says, "Performance Appraisal is a systematic, periodic and so far
as humanly possible and impartial rating of employee's excellence of matters pertaining to his
potentialities for a better job". Performance appraisal has been defined in many ways.

The simplest way to understand the meaning of performance appraisal is as follows: “A regular and
continuous evaluation of the quality, quantity and style of the performance along with the assessment of
the factors influencing the performance and behavior of individuals called performance appraisal”.

Cleveland, Murphy, and Williams (1989) argued that there is a relationship between organizational
characteristics and the uses of a performance appraisal system. Stonich (1984) also argued that
performance measurement in an organization should be in tune with its structure and culture.

Since the nature of the enterprises in which each industry is engaged varies, its organizational type,
business policy, internal and external environment are also usually different. The purpose of this study is
to conduct a direct comparative analysis of performance appraisal system in the service and
manufacturing industries.

Apart from organizational control, Ilgen, Barnes-Farrell, and McKellin (1993) concluded, from their
extensive review of the literature since the 1980s about performance appraisal, that there are four aspects
that need to be considered. In practice performance appraisal systems cover a wide range of these aspects,
and seldom have exactly the same nature and functions.

In order to integrate findings in the area, Chu (2002) proposed a comprehensive framework including six
categories, namely, appraisal purposes, appraises personnel, appraisal criteria, appraisal methods,
appraisal timings, and appraisal feedback.

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3. Research Methodology
3.1 Scope of study:-
 The study will help the employees to have better insights into the performance appraisal of the
organization.
 It will help in better evaluation of the performance of employees and identifies their strengths and
weaknesses.

3.2 Objectives of Study:-

 To study the performance appraisal system at GS Lab PVT LTD Pune.
 To study the opinion of employees with regards to performance appraisal system.
 To study the satisfaction level of employees.
 To study whether the current appraisal system is conducted in fair manner.

3.3 Limitations of study

 The study is limited to 50 sample size
 The information gathered was based on the responses to the questionnaire.
 Time span for study was restricted.
 As a policy matter of the organization, they could not disclose the full information related to
company.

3.4 Hypothesis of Study:-

Ho: - Current appraisal and satisfaction level of employees are independent.

H1:- Current appraisal and satisfaction level of employees are dependent.

3.5 Research Design

 Type of Research-
In this study of employee perception toward performance appraisal process, we have used
experimental type of research.
 Type of Study-
Type of study used in the employee perception toward performance appraisal process is
survey method.
 Sample Size-
In this study of employee perception toward performance appraisal process we have
taken 30 respondents as sample.
 Selection of sample size-

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In this study we have selected stratify random sampling method, in which out of 30
respondents are of HR department of GS Lab.
 Tools and Techniques-
In this study of the employee perception toward performance appraisal process, we have
used T-test chi square test for the hypothesis.

 Type of Data-Data Collection: - There are two types of data.

I. Primary Data
II. Secondary Data

 Primary Data-
Primary data is first-hand information. Which can be collected through methods and
individuals survey for this project it is concerned the primary data is collected
through questionnaire and interview.

A. Questionnaire-
A questionnaire is a research instrument consisting of a series of question and others
promote for the purpose of gathering information from respondents. The
questionnaire is prepared by taking into consideration the objective of the study.
In questionnaire there are close ended questions. Close ended
questions include yes/no and multiple choice it includes the respondents has several
options from which to choose.
Questionnaire is been attached in annexure at last.

B. Interview- In interview method of data collection we have used personal interviews

and so on.

 Secondary Data-
Secondary data is already published and which is collected from different sources like
reference book, newspaper and with the help of internet etc. the secondary data is also
collected with the help of company’s website and magazines.

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4. Data analysis and Interpretation

4.1 Graphical presentation of data.
1. Gender ratio of the respondents.

Particulars Respondents Percentage

Male 16 53
Female 14 47
Total 30 100

Percentage

100
90
80
70
Percentage
60
50
40
30
20
10
0
Male Female Total

Interpretation- The above graph shows the gender ratio of the respondents. Out of total 30 respondents 53
percent respondents are male and 47 percent respondents are female.

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2. Experience level of the respondents.

Particulars Respondents Percentage

Less than 2 years 8 27
2-5 years 10 33
5-10 years 6 20
Above 10 years 6 20
Total 30 100

Percentage
100
90
80
70
60 Percentage
50
40
30
20
10
0
Less than 2 2-5 yrs 5-10 yrs Above 10 Total
yrs yrs

Interpretation- The above graph shows the experience level of the respondents. Out of the total 30
respondents 33 percent respondents have 2-5 years of experience, 27 percent respondents have less than 2
years of experience, and 20 percent respondents have 5-10 years and above 10 years respectively.

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3. Was the current appraisal system conducted in fair manner?

Particulars Respondents Percentage

Yes 29 97
No 1 3
Total 30 100

Percentage

100
90
80
70
Percentage
60
50
40
30
20
10
0
Yes No Total

Interpretation- The above graph shows weather the current appraisal system was conducted in fair
manner. Out of total 30 respondents 97 percent of respondents feel that it was conducted in fair manner
and 3 percent feels it wasn’t.

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4. Are you involve in setting the target?

Particulars Respondents Percentage

Yes 25 83
No 5 17
Total 30 100

Percentage

100
90
80
70
Percentage
60
50
40
30
20
10
0
Yes No Total

Interpretation- The above graph shows weather the employees are involved in setting the target. Out of
the total 30 respondents 83 percent respondents says and 17 percent says no.

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4.2 Cross Tabulation:-

Variables Male Female Total

Yes No Yes No

1. Current appraisal 15 1 13 1 30
conducted in fair way.
Percentage 50% 3% 47% 3% 100%

2. Weather meeting 14 2 11 3 30
conducted at beginning.
Percentage 47% 6% 37% 10% 100%

3. Supposed to appraise 15 1 12 2 30
your performance.
Percentage 50% 3% 40% 7% 100%
4. Should involve in 13 3 12 2 30
finding target.
Percentage 43% 10% 40% 7% 100%
5. Are involved in setting 15 1 14 0 30
target.
Percentage 50% 3% 47% 0% 100%

6. Appraisal`s impact on 14 2 12 2 30
performance.
Percentage 46% 7% 40% 7% 100%

7. Proper appraisal 11 5 11 3 30
impact on sincerity.
Percentage 37% 16% 37% 10% 100%

8. Any loopholes in 1 15 2 12 30
performance appraisal.
Percentage 3% 50% 7% 40% 100%

Interpretation- Above table shows the cross tabulation of the data, which is based on the male and female
and their choices as per the questionnaire. It shows out of total 30 respondents how much male and
females has their choices in percentage also which makes easy to understand and evaluate.

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4.3 Hypothesis testing:-

In this study of employee perception toward performance appraisal in information technology industry,
we have used chi square test at 5% level of significance.

 Hypothesis-
Ho- Current appraisal and satisfaction level of employee are independent.
H1- Current appraisal and satisfaction level of employee are dependent.

 Observed frequency table-

Strongly Satisfied Dissatisfied Strongly Total
Satisfied Dissatisfied
HR Analyst 4 9 0 0 13

Learning & 2 5 0 0 7
Development
Talent 1 6 0 0 7
Management
Info Sec 0 3 0 0 3

Total 7 23 0 0 30

 Expected frequency table-

a b c D Total
A 3 10 0 0 13
B 2 5 0 0 7
C 2 5 0 0 7
D 1 2 0 0 3
Total 8 22 0 0 30

Note - Calculation of Chi square test at 5% level if significance at 9 degree of freedom.

Degree of freedom 9
Level of significance 5%
Table value of Chi square (X^2) 16.919
Calculated value of Chi square (X^2) 1.63
Comparison of Chi square value. Table(X^2) > Calculated(X^2)

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Conclusion – Hence the table value is much greater than the calculated value of chi square test, therefore
the hypothesis supports our study and H1 is accepted. i.e. – Current appraisal and satisfaction level of
employee are dependent.

5. Findings & Discussion

5.1 Findings:-
1. It has been found that out of total 30 respondents, 53 percent respondents are male.
2. It has been found that out of total 30 respondents, 33 percent respondents have
experience of 2-5 years.
3. It has been found that out of total 30 respondents, 97 percent respondents say that current
appraisal system was conducted in fair manner.
4. It has been found that out of total 30 respondents, 84 percent respondents say that
meeting was conducted at the beginning of the appraisal period.
5. It has been found that out of total 30 respondents, 90 percent respondents say that they
are supposed to appraise their performance.
6. It has been found that out of total 30 respondents, 83 percent respondents say that they
should be involved in finding the target.
7. It has been found that out of total 30 respondents, 97 percent respondents were involved
in setting the target.
8. It has been found that out of total 30 respondents, 86 percent respondents say that
appraisal system have some impact on employee performance.
9. It has been found that out of total 30 respondents, 74 percent respondents say that proper
appraisal has an impact on employee’s sincerity.
10. It has been found that out of total 30 respondents, 90 percent respondents say that there
are not any loopholes in the performance appraisal system.
11. It has been found that out of total 30 respondents, 50 percent respondents say that
organize penalize them as no increment for their low performance.
12. It has been found that out of total 30 respondents, 77 percent respondents are satisfied
with the current appraisal system.

5.2 Observation:-
From the above all findings it has been observed that maximum respondents are
satisfied with the current appraisal system of their organization, and there are no loopholes in the current
appraisal system of their organization.

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6. Conclusion:-
“A study on employee perception towards the current appraisal system in
information and technology industry” It has been concluded that maximum
numbers of respondents are satisfied with their current appraisal system of their
organization and maximum respondents has good opinion and say that the current
appraisal system was conducted in fair manner. Which will not only help in
development of organization but also important for employee performance.

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Bibliography:-
Research Paper-
 IOSR Journal of Business and Management (IOSR-JBM)
e-ISSN: 2278-487X, p-ISSN: 2319-7668. Volume 9, Issue 3 (Mar. - Apr. 2013), PP 08-23
www.iosrjournals.org
www.iosrjournals.org 8 | Page
“A Study on Performance Appraisal System at Wipro Infrastructure Engineering Pvt Ltd”
Dr.S.Jansirani, Mr. R.Hatrikrishnan, Mrs.D.Jaya kani, Ms.A.Saisathya, Assistant Professor,
Department of Commerce, Vels College, Pallavaram, Chennai -117

Websites-
 https://www.gslab.com/about-us
 https://en.wikipedia.org/wiki/GS
 http://www.iosrjournals.org/iosr-jbm/papers/Vol9-issue3
 https://www.ukessays.com/essays/information-technology/introduction-of-it-industry-
information-technology-essay.php

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Annexure:-
Questionnaire
“A Study on Employee Perception towards Performance Appraisal System in
information technology industry.”
Name:-

Gender: - a) Male b) Female

Designation:-

Department:-

Experience: - a) Less than 2 years

b) 2-5 years

c) 5-10 years

d) Above 10 years

1. Is the current appraisal system were conducted fair manner?

a) Yes b) No

2. Do the manager conduct a meeting at the beginning of the appraisal period?

a) Yes b) No

3. Are you supposed to appraise your performance?

a) Yes b) No

4. Should employee be involved in finding the target?

a) Yes b) No

5. Are you involve in setting the target?

a) Yes b) No

6. Do you think appraisal system have some impact on employee’s performance?

a) Yes b) No

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7. Do you think proper appraisal has an impact on employee’s sincerity?

a) Yes b) No

8. Are there any loopholes in performance appraisal system?

a) Yes b) No

9. How the organization penalize for low performance?

a) No increment b) Demotion

c) Transfer d) Internal Transfer

e) Termination

10. Are you satisfied with the current appraisal system?

a) Strongly Satisfied b) Satisfied

c) Dissatisfied d) Strongly Dissatisfied

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