Training and Development

Training Vs Development
• Training-Process of providing employees with
necessary skills or helping them correct deficiencies in
their performance. This helps in performing the
current job in a better way

• Development- To prepare employees for future jobs

by providing necessary abilities.
 Induction Vs Orientation
BASIS FOR COMPARISON INDUCTION ORIENTATION

Induction is a process A process which involves assimilation of

takes place to welcome new joinee into the organization to
Meaning newcomer to the rehabilitate him at the new workplace and
organization, to make provided with basic information about the
them ready for their job. company.

Introduction of the
Integration of the employee in the
Involves employee with the
organization.
organization.
Time horizon Short term Long term
Sequence First Second
Detailed presentation or
brochure of the
Form company's rules, Practical overview of the organization.
policies and employee
benefits is provided.
Orienting Employees
• Employee orientation
• A procedure for providing new employees with basic
background information about the firm.
• Orientation content
• Information on employee benefits
• Personnel policies
• The daily routine
• Company organization and operations
• Safety measures and regulations
• Facilities tour
Orienting Employees (cont’d)
• A successful orientation should accomplish four things for new
employees:
• Make them feel welcome and at ease.
• Help them understand the organization in a broad sense.
• Make clear to them what is expected in terms of work and behavior.
• Help them begin the process of becoming socialized into the firm’s ways of
acting and doing things.
The ADDIE Five-Step Training Process
• Analyze
• Design
• Develop
• Implement
• Evaluate
 The Training and Development Process

• Needs analysis
• Identify job performance skills needed, assess prospective trainees skills, and develop
objectives.
• Instructional design
• Produce the training program content, including workbooks, exercises, and activities.
• Validation
• Presenting (trying out) the training to a small representative audience.
• Implement the program
• Actually training the targeted employee group.
• Evaluation
• Assesses the program’s successes or failures.
Conducting the Training Needs Analysis
• Strategic Training Needs Analysis
(Organizational Level)
• Current Training Needs Analysis
• Task/ operational/Job Level Analysis
(JDs)
• Performance Analysis(Individual
Analysis)
 Task
Analysis
Record
Form
Designing the Training Program
• Scan all the information collected from TNA.
• Think of ideas
• Prepare a storyboard or mind-map for conducting training
• Arrange the sequence
• Decide on the delivery methods
Developing the Training Program
• At the start of training, provide a bird’s-eye view of the material to be presented
to facilitate learning.
• Use a variety of familiar examples.
• Organize the information so you can present it logically, and in meaningful units.
• Use terms and concepts that are already familiar to trainees.
• Use as many visual aids as possible.
Developing the Program
• Assemble training content and materials
• Training Methods
‒ iPads
‒ Workbooks
‒ Lectures
‒ PowerPoint slides
‒ Web- and computer-based activities course activities
‒ Trainer resources and manuals
‒ Support materials
Developing the Program
• Goal setting
• Modeling
• Meaningfulness
• Individual Differences- KVA
• Whole-versus-part learning
• Mass-versus-distributed learning
• Active practice
• Feedback
 Make Skills Transfer Easy

• Maximize the similarity between the training situation and the work situation.
• Provide adequate practice.
• Label or identify each feature of the machine and/or step in the process.
• Direct the trainees’ attention to important aspects of the job.
• Provide “heads-up” preparatory information that lets trainees know they might
happen back on the job.
Evaluating the Training Effort
• Designing the study
• Time series design
• Controlled experimentation
• Training effects to measure (Kirkpatrick’s Model)
• Reaction of trainees to the program
• Learning that actually took place
• Behavior that changed on the job
• Results that were achieved as a result of the training
Time Series Training Evaluation Design

Figure 8–5
A Sample
Training
Evaluation
Form
Reinforce The Learning
• Reinforce correct responses
‒ Schedule
‒ Follow-up assignments
‒ Incentives
• Ensure Transfer of Learning on
the job
• Other issues
Methods of training
• On-the Job
• Off-the Job
Training Methods
• On-the-job training (OJT)
• Having a person learn a job by actually doing the job.
• OJT methods
• Coaching or understudy
• Job rotation
• Special assignments
• Advantages
• Inexpensive
• Immediate feedback
Training Methods (cont’d)
• Apprenticeship training
• A structured process by which people become skilled
workers through a combination of classroom instruction
and on-the-job training.
• Informal learning
• The majority of what employees learn on the job they learn
through informal means of performing their jobs on a daily
basis.
• Job instruction training (JIT)
• Listing each job’s basic tasks, along with key points, in order
to provide step-by-step training for employees.
 The 25 Most Popular Apprenticeships
According to the U.S. Department of Labor apprenticeship database, the occupations listed below had
the highest numbers of apprentices in 2001. These findings are approximate because the database
includes only about 70% of registered apprenticeship programs—and none of the unregistered ones.

• Boilermaker • Machinist
• Bricklayer (construction) • Maintenance mechanic (any industry)
• Carpenter • Millwright
• Construction craft laborer • Operating engineer
• Cook (any industry) • Painter (construction)
• Cook (hotel and restaurant) • Pipefitter (construction)
• Correction officer • Plumber
• Electrician • Power plant operator
• Electrician (aircraft) • Roofer
• Electrician (maintenance) • Sheet-metal worker
• Electronics mechanic • Structural-steel worker
• Firefighter • Telecommunications technician
• Tool and die maker

Figure 8–2
Steps in OJT

Prepare the learner

Present the Operation

Do a try out

Follow Up
On-the-job training
Advantages-
• Task relevant
• Cost-effective
Disadvantages-
• Customer frustration
• Errors and damage to equipments
• Trainers may not be able to transfer their knowledge
to others.
• Quality and content varies substantially
Three Drawbacks of OJT
• (1) the lack of a well-structured training environment,
• (2) poor training skills on the part of managers, and
• (3) the absence of well-defined job performance criteria.
How to make OJT Effective
• 1.Develop realistic goals and/or measures for each OJT area;
• 2. Plan a specific training schedule for each trainee, including set
periods for evaluation
• and feedback;
• 3. Help managers establish a nonthreatening atmosphere conducive
to learning;
• 4. Conduct periodic evaluations after training is completed to ensure
employees have
• not forgotten what they have learned.
Off-the Job Training
Presentation Options
-Lectures
-Programmed Learning
-Slides & Videotapes
-Tele-training
-Computer Based Training
-Simulations
-Virtual Reality
-Role plays
-Case Studies
-Metaverse
-In-Basket Exercises
Training Methods (cont’d)
Effective lectures
• Use signals to help listeners follow your ideas.
• Don’t start out on the wrong foot.
• Keep your conclusions short.
• Be alert to your audience.
• Maintain eye contact with the trainees.
• Make sure everyone in the room can hear.
• Control your hands.
• Talk from notes rather than from a script.
• Break a long talk into a series of five-minute talks.
Programmed Learning
• Programmed instruction (PI)
• A systematic method for teaching job skills
involving:
• Presenting questions or facts
• Allowing the person to respond
• Giving the learner immediate feedback on the
accuracy of his or her answers
• Advantages
• Reduced training time
• Self-paced learning
• Immediate feedback
• Reduced risk of error for learner
Training Methods (cont’d)
• Literacy training techniques
• Responses to functional illiteracy
• Testing job candidates’ basic skills.
• Setting up basic skills and literacy programs.
• Audiovisual-based training
• To illustrate following a sequence over time.
• To expose trainees to events not easily demonstrable in live lectures.
• To meet the need for organizationwide training and it is too costly to move
the trainers from place to place.
Training Methods (cont’d)
• Simulated training (occasionally called vestibule training)
• Training employees on special off-the-job equipment so training costs and
hazards can be reduced.
• Computer-based training (CBT)
• Electronic performance support systems (EPSS)
• Learning portals
Computer-based Training (CBT)
• Advantages
• Reduced learning time
• Cost-effectiveness
• Instructional consistency
• Types of CBT
• Intelligent Tutoring systems
• Interactive multimedia training
• Virtual reality training
Distance and Internet-Based Training
• Teletraining
• A trainer in a central location teaches groups of employees at remote
locations via TV hookups.
• Videoconferencing
• Interactively training employees who are geographically separated from each
other—or from the trainer—via a combination of audio and visual equipment.
• Training via the Internet
• Using the Internet or proprietary internal intranets to facilitate computer-
based training.
Training and Development for
Managerial Positions
 Assessment and Development Centres

• An Assessment Centre is actually a process applicants take part in and

is not specific to any one location. Its popularity is also evident in staff
growth plans where it is usually known as a Development Centre.
These procedures are designed to ensure employee investment is
maximised for both the organisation and the individual. Whilst the
general process is very similar to Assessment Centres the subtle
difference is that at a Development Centre you will be given feedback
immediately and work with the assessor to agree a future plan.
Exercises conducted at Assessment Centres

•Leadership skills

•Working under pressure

•Teamwork & motivation

•Analytical skills

•Co-operating with other people

•Verbal and written skills

•Numeric ability

•Complete communication skills

Assessment Centres
• Assessors are usually the managers from the company,
who are trained in assessment. This is usually a mixture of managers
from Human Resources function as well as some line managers for
whom the eventual graduate recruits will work.
Management Development Programmes
These programmes are organized to train managers
in :
1)Leadership
2)Supervisory techniques
3)Communication
4)General business
5) Organizational specific
6) Technology
What Is Management Development?

• Management development
• Any attempt to improve current or future management performance by
imparting knowledge, changing attitudes, or increasing skills.
• Succession planning
• A process through which senior-level openings are planned for and eventually
filled.
• Anticipate management needs
• Review firm’s management skills inventory
• Create replacement charts
• Begin management development
Managerial on-the-Job Training
• Job rotation
• Moving a trainee from department to department to broaden his or her
experience and identify strong and weak points.
• Coaching/Understudy approach
• The trainee works directly with a senior manager or with the person he or she
is to replace; the latter is responsible for the trainee’s coaching.
• Action learning
• Management trainees are allowed to work full-time analyzing and solving
problems in other departments.
Off-the-Job Management Training and Development Techniques

• Case study method

• Managers are presented with a description of an
organizational problem to diagnose and solve.
• Management game
• Teams of managers compete by making computerized
decisions regarding realistic but simulated situations.
• Outside seminars
• Many companies and universities offer Web-based and
traditional management development seminars and
conferences.
 Off-the-Job Management Training and
Development Techniques (cont’d)

• Role playing
• Creating a realistic situation in which trainees assume the
roles of persons in that situation.
• Behavior modeling
• Modeling: showing trainees the right (or “model”) way of
doing something.
• Role playing: having trainees practice that way
• Social reinforcement: giving feedback on the trainees’
performance.
• Transfer of learning: Encouraging trainees apply their
skills on the job.
Off-the-Job Management Training and
Development Techniques (cont’d)

• Corporate universities
• Provides a means for conveniently coordinating all the
company’s training efforts and delivering Web-based
modules that cover topics from strategic management
to mentoring.
• In-house development centers
• A company-based method for exposing prospective
managers to realistic exercises to develop improved
management skills.
Off-the-Job Management Training and
Development Techniques (cont’d)
• Executive coaches
• An outside consultant who questions the executive’s
boss, peers, subordinates, and (sometimes) family in
order to identify the executive’s strengths and
weaknesses.
• Counsels the executive so he or she can capitalize on
those strengths and overcome the weaknesses.
 An Example
a comprehensive training program module
on "Effective Project Management" using
ADDIE model
1. Analysis

• Organizational Level Needs Assessment:

• Identify the organizational goals related to project management, such as improving
project completion rates, reducing delays, or enhancing collaboration.
• Assess how effective project management aligns with the overall strategic objectives
of the organization.
• Job or Operational Level Needs Assessment:
• Analyze the specific job roles related to project management within the organization.
• Identify the key skills and competencies required for successful project management
in various operational areas.
• Individual Level Needs Assessment:
• Conduct individual assessments or surveys to identify the current skill levels,
knowledge, and areas of improvement among employees regarding project
management.
2.Design
• Employee Readiness Assessment:
• Develop a pre-training survey or assessment to gauge employees' readiness and existing knowledge related to project management.
• Utilize the assessment results to customize the training content, ensuring that it addresses the specific needs identified at the organizational,
job, and individual levels.
• Content Structure:
• Introduction to project management principles.
• Key project management tools and techniques.
• Hands-on exercises and case studies.
• Group collaboration and communication strategies.
• Methods of Delivery:
• Instructor-led presentations.
• Group discussions.
• Hands-on workshops with project management tools.
• Simulation exercises.
• Materials:
• PowerPoint presentation.
• Project management templates.
• Case studies and scenarios for discussion.
• Handouts on project management best practices.
3. Development

• Create Content:
• Develop engaging slides with relevant content on project management principles and
tools.
• Design hands-on exercises that simulate real-world project scenarios.
• Create case studies that reflect the specific challenges faced by the organization.
• Interactive Activities:
• Role-playing exercises for practicing communication and collaboration in project
teams.
• Group discussions on real-world project management challenges.
• Multimedia Elements:
• Integrate multimedia elements like video tutorials on project management software
and interviews with experienced project managers.
Implementation:

• Employee Readiness Assessment (During Implementation):

• Administer the readiness assessment to participants before the training
session.
• Use the results to tailor discussions and activities during the training,
addressing specific project management areas identified by participants.
• Training Sessions:
• Schedule training sessions, ensuring convenient timing for participants.
• Deliver the module using a mix of presentation, discussions, and hands-on
activities.
Schedule of 2 day-Training program
• Day 1: Introduction to Project Management Principles
• 9:00 AM - 9:30 AM: Registration and Welcome
• Sign-in, distribution of materials, and introduction to the training program.
• 9:30 AM - 10:30 AM: Overview of Project Management
• Understanding the importance of project management.
• Key principles and benefits.
• 10:30 AM - 10:45 AM: Morning Break
• 10:45 AM - 12:00 PM: Organizational Level - Aligning Projects with Goals
• Analyzing organizational goals and how project management supports them.
• Case studies on successful project implementations.
• 12:00 PM - 1:00 PM: Lunch Break
• 1:00 PM - 2:30 PM: Operational Level - Key Project Management Skills
• Identifying specific skills required for effective project management in various job roles.
• Hands-on exercises and group discussions.
• 2:30 PM - 2:45 PM: Afternoon Break
• 2:45 PM - 4:30 PM: Individual Level - Assessing Personal Project Management Skills
• Conducting individual self-assessments.
• Tailoring the training content based on individual needs.
Schedule of 2 day-Training program
• Day 2: Practical Application and Evaluation
• 9:00 AM - 10:30 AM: Tools and Techniques in Project Management
• Introduction to project management tools and software.
• Practical demonstrations and hands-on workshops.
• 10:30 AM - 10:45 AM: Morning Break
• 10:45 AM - 12:00 PM: Collaboration and Communication in Project Teams
• Strategies for effective communication within project teams.
• Role-playing exercises.
• 12:00 PM - 1:00 PM: Lunch Break
• 1:00 PM - 2:30 PM: Employee Readiness Assessment Review
• Discussing the results of the readiness assessment.
• Customizing discussions and activities based on assessment findings.
• 2:30 PM - 2:45 PM: Afternoon Break
• 2:45 PM - 4:30 PM: Application and Evaluation
• Group project simulations.
• Reviewing Philip's Model of Training Evaluation.
• 4:30 PM - 5:00 PM: Q&A, Feedback, and Closing
• Addressing participant questions.
• Collecting feedback using evaluation forms.
5. Evaluation (Philip's Model):
• Level 1: Reaction - Participant Feedback
• Method: Post-training survey and feedback forms.
• Questions:
• How satisfied were participants with the overall training program?
• Did participants find the content relevant and engaging?
• Were the training materials helpful and well-presented?
• Level 2: Learning - Knowledge and Skill Acquisition
• Method: Pre and post-training knowledge assessments, self-assessments.
• Indicators:
• Improvement in participants' scores on project management knowledge assessments.
• Self-assessment of acquired skills and confidence in applying project management principles.
• Level 3: Behavior - Transfer of Training to the Job
• Method: Follow-up assessments, supervisor feedback.
• Indicators:
• Observations of participants applying project management skills in their roles.
• Feedback from supervisors and team members on changes in behavior and project outcomes.
5.Evaluation (Philip's Model) contn:
• Level 4: Results - Organizational Impact
• Method: Post-training analysis of project outcomes, team performance
metrics.
• Indicators:
• Measurable improvements in project completion rates.
• Enhanced collaboration and communication within project teams.
• Reduction in project delays or cost overruns.
• Level 5: Return on Investment (ROI) - Cost-Benefit Analysis
• Method: Cost analysis and comparison with benefits.
• Indicators:
• Calculate the costs associated with the training program.
• Measure the tangible benefits, such as increased productivity, improved project
success rates, and time/cost savings.
PERFORMANCE APPRAISAL
PERFORMANCE APPRAISAL
It means evaluating an employee’s
current &/or past performance relative
to his/her performance standards.

https://www.youtube.com/watch?v=peq0z49Nw4I
Performance Appraisal Vs Performance
Management
Performance Appraisal is year end activity. Performance Management
is a process that starts the year with performance planning.
Basic features of PM are:
1) Articulation of organizational goals
2) Goal Alignment
3) On going Performance monitoring
4) On going feedback
5) Coaching & developmental support
6) Rewards & recognition
Performance Management versus
Performance Appraisal
Performance
Performance Appraisal
Management

Processes used to The process of evaluating

identify, encourage, how well employees
measure, evaluate, perform their jobs and
improve, and reward then communicating that
employee performance information to the
employees

59
Types of Performance Information

Subjective Objective

60
Uses Of Performance Appraisal

61
Process of Performance Appraisal
1) Identifying Performance Dimensions
a) Quality
b) Quantity
c) Behaviour
2) Create a Competency Model
3) Measuring Performance
APPRAISAL METHODS

TRAIT APPRAISAL METHODS

CHECKLISTS
SIMPLE
WEIGHTED
RANKING COMPARISONS
ALTERNATION
PAIRED COMPARISONS
RATING SCALES
GRAPHIC RATING SCALES
BEHAVIORAL METHODS
CRITICAL INCIDENTS
BEHAVIORALLY ANCHORED RATING SCALES (BARS)
OBJECTIVE MEASURES
NATURAL COUNTS (Quantity produced, etc)
GOALSETTING STANDARDS (MBO, etc)
Essay Evaluation

• The rater is asked to express the strong as well as weak points of

employee’s behavior
• The rater considers the employee’s
• Job knowledge and potential
• Understanding of company’s programs, policies, objectives etc.
• Relation with co-workers and supervisors
• Planning, organizing and controlling ability
• Attitude and perception
Checklist
• A checklist is a set of objectives or descriptive statements about the
employee and his behaviour
• Under weighted checklist, value of each question may be weighted.
• Is the employee really interested in the task assigned? Yes/No
• Is he respected by his colleagues? Yes/No
Simple Checklist Method
• Simple checklist method

• Weighted checklist method

• Forced Choice method

Simple checklist method
• Is employee regular Y/N

• Is employee respected by subordinate Y/N

• Is employee helpful Y/N

• Does he follow instruction Y/N

• Does he keep the equipment in order Y/N

Weighted Checklist Method
Weights Performance Rating

Regularity 0.5

Loyalty 1.5

Willing to help 1.5

Quality of work 1.5

Relationship 2.0
Forced Choice Method
• This method uses several sets of paired phrases, two of which may be
positive and two negative
• The rater is asked to indicate which of the four phrases is the most a
and least descriptive of a particular worker
• Favourable qualities earn plus credit and unfavourable ones earn the
reverse.
Forced Choice Method
Criteria Rating
Regularity on the Job Most Least
Always regular
Inform in advance for delay
Never Regular
Remain Absent
Neither regular nor irregular
Ranking Method
• The evaluator rates the employee from highest to
lowest on some overall criteria
Employee Rank
A 2

B 1

C 3

D 5

E 4
Alternation Ranking Scale
Paired Comparison Method
• Each worker is compared with all other employees in a group
• For several traits paired comparisons are made tabulated and then
rank is assigned to each worker
• This method is not applicable when the group is large
 Ranking Employees by the
Paired Comparison Method

Note: + means “better than.” − means “worse than.” For each chart, add up the number of
1’s in each column to get the highest-ranked employee.
Forced Distribution Methods
• The Rater is asked to appraise the employee according to
predetermined distribution scale
• Two criteria used for rating are: job performance and promotability
• A five point performance scale is used
• The worker is placed between two extremes of “good” and “bad”
Forced Distribution on a Bell-Shaped Curve
Field Review Method
The appraiser goes to the field and obtains the information about
work performance of the employee by way of questioning the said
individual, his peer group and his superiors.
Graphic Rating Scale
• A form is used to evaluate the performance of the employees
• A variety of traits may be used in this device, the most common being
quality and quantity of work
• Easy to understand and use
• Permits statistical tabulation of scores
Graphic Rating Scale
Continuous Rating Scale
 Discontinuous Rating Scale

Attitude
• No Interest Interested Very Enthusiastic

Indifferent Enthusiastic
Critical Incidents

• Manager prepares lists of statements of very effective and ineffective

behavior of an employee
• These critical incidents represent the outstanding or poor behavior of
the e employees
• The manager periodically records critical incidents of employee’s
behaviour
 A fire, sudden breakdown, accident
Critical Incident Method

Workers Reaction Scale

A Informed the supervisor 5

immediately

B Become anxious on loss of 4

output

C Tried to repair the machine 3

D Complained for poor 2

maintenance

E Was happy to forced test 1

BARS(Behaviourally Anchored Rating Scale)

Develop Final
Instruments
Assign scales
to Incidents
Retranslate
the Incidents
Select
Performance
Identify Dimension
Critical
Incidents
MBO Process
• Set Organizational goals

• Defining performance target

• Performance review

• Feedback
MBO
• MBO emphasizes collectively set goals that are tangible, verifiable,
and measurable
• Focuses attention on goals rather than on methods
• Concentrates on Key Result Areas (KRA)
• Systematic and rational technique that allows management to attain
maximum results from available resources by focusing on achievable
goals
Key Elements of MBO
• Arranging organizational goals in a means-ends chain
• Engaging in joint goal setting
• This process has the following steps:
• Identify KRAs
• Define expected results
• Assign specific responsibilities to employees
• Define authority and responsibility relationship
•Conducting periodic progress review
•Conducting annual performance review
The MBO Process
1. Job review and
agreement

2. Development of
performance
standards

3. Setting of
objectives

4. Continuing
performance
discussions 91
Who Should Do the Appraising?
1. Peer Appraisals
2. Rating Committees
3. Self Ratings
4. Appraisal by Subordinates
5. 360-Degree Feedback
360 Appraisal System
• It is systematic collection and feedback of performance
data on an individual or group, derived from a number
of stakeholders
• Data is gathered and fed back to the individual
participant in a clear way designed to promote
understanding, acceptance and ultimately behaviour
360 Appraisal System
Appraisal taken from
• Boss

• Subordinates

• Peers

• Immediate supervisor
7200 Feedback
APPRAISAL ERRORS
RATER ERRORS AND BIAS
PERSONAL BIAS
HALO & HORN ERRORS
DISTRIBUTION (RANGE) ERRORS
Leniency, Strictness, or Central Tendency

RECENCY EFFECT

ORGANISATIONAL POLITICS

INDIVIDUAL OR GROUP FOCUS

Common Rater Errors

97
Personal Bias (Stereotyping)
• Managers allow individual differences such as gender,
race or age to affect ratings they give

• Effects of cultural bias, or stereotyping, can influence

appraisals
Halo/Horn Error
• Halo error - Occurs when manager generalizes one
positive performance feature or incident to all aspects of
employee performance resulting in higher rating

• Horn error - Evaluation error occurs when manager

generalizes one negative performance feature or incident
to all aspects of employee performance resulting in lower
rating
Leniency/Strictness
• Leniency - Giving undeserved high ratings
• Strictness - Being unduly critical of employee’s work performance
• Worst situation is when firm has both lenient and strict managers and
does nothing to level inequities
Central Tendency
• Error occurs when employees are incorrectly rated near average or
middle of scale
• May be encouraged by some rating scale systems requiring evaluator
to justify in writing extremely high or extremely low ratings
Recent Behavior Bias
• Employee’s behavior often improves and productivity tends to rise
several days or weeks before scheduled evaluation
• Only natural for rater to remember recent behavior more clearly than
actions from more distant past
• Maintaining records of performance
Manipulating the Evaluation
• Sometimes, managers control virtually every aspect of appraisal
process and are in position to manipulate system
• Example: Want to give pay raise to certain employee. Supervisor may
give employee a undeserved high performance evaluation
Employee Anxiety
• Evaluation process may create anxiety for appraised employee

• Opportunities for promotion, better work assignments, and increased

compensation may hinge on results
The Need for Fairness
Checklist of Best Practices for Administering Fair
Performance Appraisals
• Base the performance review on duties and standards from a
job analysis.
• Try to base the performance review on observable job
behaviors or objective performance data.
• Make it clear ahead of time what your performance
expectations are.
• Use a standardized performance review procedure for all
employees.
 The Need for Fairness

• Make sure whoever conducts the reviews has frequent opportunities

to observe the employee’s job performance.
• Either use multiple raters or have the rater’s supervisor evaluate the
appraisal results.
• Include an appeals mechanism.
• Document the appraisal review process and results.
 The Need for Fairness

• Discuss the appraisal results with the employee.

• Let the employees know ahead of time how you’re going to conduct
the reviews.
• Let the employee provide input regarding your assessment of him or
her.
• Indicate what the employee needs to do to improve.
 The Need for Fairness
• Train the supervisors who will be doing the appraisals. Make sure they
understand the procedure to use, how problems (like leniency and
strictness) arise, and how to deal with them.
The Need for Fairness
Appraiser should NOT
• Surprise the Employee
• Make It a One-Way Conversation
• Be Vague or
• Use Comparisons
• Overemphasize Negative Feedback:
• Rush the Process
• Make Promises You Can't Keep:
• Be Biased or Discriminatory9.
• Lose Sight of Development Neglect Follow-Up
Managing the Appraisal Interview
• Appraisal Interview – an interview in which the
supervisor and subordinate review the appraisal and
make plans to remedy deficiencies and reinforce
strengths.
Job Evaluation Process
 Factors Influencing Remuneration

Business Strategy Market Position Remuneration Strategy Blend of

Remuneration
Invest to grow Merging or grow Encourage innovation High cash and
rapidly and entrepreneurship incentives for
performance.
Modest benefits
Manage earning Normal growth to Reward management Average incentives
Protect Markets maturity skills with average cash on
unit and individual
performance.
Standard benefits

Harvest earnings Maturity or Focus on cost control Below average cash

invest somewhere decline with few incentives
else that too tied with
cost control efforts.
Standard benefits
 Kinds of
Incentive Plans

Organization
Group Incentive
Individual Wide Incentive
Plans
Plans

Based on Gain Sharing Profit Sharing

Based on Time ESOPs
Productivity Plans Plans

Stock
Halsey Plan Taylor Plan Scanlon Plan
Awards/RSU

Rowan Plan Merrick Plan Rucker Plan Stock Options

Emerson Plan Gantt Plan Improshare Plan

Bedeaux Plan
 Sales
Personnel

Salary Commission Combination

Compensation Plans
• Compensation plans for sales personnel may consist of a straight salary plan,
a straight commission plan, or a combination salary and commission plan.
The straight salary plan allows salespeople to be paid for performing duties
not reflected immediately in their sales volume. It enables them to devote
time to providing services and building customer goodwill without
jeopardizing their income. A limitation of this plan is that employees may not
be motivated to maximize their sales volume.

• The straight commission plan bases compensation on a percentage of sales.

This plan provides maximum incentive and is relatively easy to compute and
understand. However, disadvantages of this type of plan include an emphasis
on sales volume instead of profits. In addition, customer service after the
sale is likely to be a lower priority.

• When a combination salary and commission plan is used, the percentage of

cash compensation paid out in commissions is called leverage. Leverage is a
ratio of base salary to commission. The amount of leverage is determined
after considering the constraining factors affecting performance. The
combination plan has the advantages of both the straight salary and the
straight commission plans, with few disadvantages.
Fringe Benefits
• Fringe benefits are generally classified under four heads –
• For Employment Security –This head includes the benefits like
- Leave Travel Pay
- Overtime Pay
- Leave for Maternity
- Holidays
- Cost of living bonus
• For Health Protection – This Includes For Health Protection
• – Accident Insurance
• - Disability Insurance
• - Health Insurance
• - Life Insurance
• - Medical Care
• - Sick Leave
Fringe Benefits
For Old Age & Retirement –
- Pension
• - Gratuity
• - Provident Fund
• - Medical Benefits for retired person
• - Travelling concession to retired employees
• - Jobs to sons/daughters
For Personnel Identification, Participation & Stimulation
• Anniversary Awards
• - Attendance Bonus
• - Canteen
• - Educational Services
• - Housing
• - Income Tax Aid
• - Stress Counseling
• - Safety Measures
Perquisites (Perks)
Google Zappos

• Free food for breakfast, lunch, and dinner. • Above-average medical, dental, and vision
• On-site haircuts. insurance coverage.
• On-site wellness service.
• A fully equipped gym and swim-in-place pool.
• Pet insurance.
• Game rooms with video games and tables for
ping pong, billiards, and foosball. • Pre-paid legal.
• Laundry facility and dry cleaning services. • 40% employee discount for those who love
shoes and accessories.
• On-site medical staff.
• Free food for breakfast, lunch, snacks, and
breaks.
• Monthly team outings.
• Nap rooms so you can rest and rejuvenate for
the remainder of the workday.
 Revised Salary Structure effective April 2008
Salary Structure
Annual Gross (For Illustration) 500000 Remarks
Components Per Month Per Annum
Basic
20833 250000 Basic Salary is is a Taxable Component it will be 50% of the Gross Salary .
(Payable monthly)
House Rent Allowance (HRA) will be 50% of monthly Basic Salary. This could be a Tax Free
HRA (50% of Basic)
10417 125000 component in the hands of the employees provided they comply with the conditions laid down under the
(Payable Monthly)
Income Tax Act.
Conveyance Allowance Conveyance Allowance is a Tax Free component in monthly salary as the same is paid to cover the
800 9600
(Payable Monthly) actual expenses incurred by the employees for attending their office.
Education Allowance
200 2400 Education Allowance is a Tax free component in monthly salary
(Payable Monthly)
Mobile Allowance is payable to Deputy Consultant to Sr. Consultant level employees. This amount will
be taxed. Employees, desirous of getting this amount exempted from their taxable income, will be required
Mobile Allowance *
1000 12000 to produce original supporting bills( Maximum up to Rs. 12000/- per annum) in the month of January
(Payable Monthly)
every year. The Income Tax relief will be worked out only for such employees and the necessary relief in
their Income Tax deduction can be provided in last two months of the financial year.
Medical Allowance is a taxable component paid every month. Employees, desirous of getting this amount
exempted from their taxable income, will be required to produce original supporting medical bills(
Medical Allowance (Payable
1250 15000 Maximum up to Rs. 15000/-) in the month of January every year. The Income Tax relief will be worked
Monthly)
out only for such employees and the necessary relief in their Income Tax deduction can be provided in last
two months of the financial year
Personal Allowance
Personal Allowance is a Taxable Component, used as an adjustment factor for grossing up the salary and
(Adjustment Factor - Payable 2931 35175
hence may vary from person to person.
Momthly)
Leave Travel Assistance (LTA) is to be claimed by the employees only once a year. This amount gets
carries forward to next year if not claimed. Employees desirous of getting this amount Tax Free will have to
LTA (8.33% of Basic)
1735 20825 claim this amount once in a TWO years and will be required to comply with the conditions laid down by the
(Payable Once in a Year)
Income Tax Act failing which the amount will be incorporated in Taxable income for the year in which it is
claimed.
PF (12% of Basic) Provident Fund is a Statutory Compliance, this amount is Employer's matching contribution and is a part
2500 30000
(Employer's Monthly Contribution) of Tax free component deposited with the PF Commissioner.
Total Gross Salary 41667 500000
* Deputy Manager and above level employees have been provided Blackberry sets.The actual monthly bill subject to Rs. 2000/- will be reimbursed to them and in
view of this arrangement, they will not be paid separate mobile allowance in monthly salary. Similarly, the arrangement of providing Ticket Restaurant Coupons is
being discontinued w.e.f. April 08. The above amounts are adjusted in other components of the salary structure.
Flexible Benefit Plan
Benefits of FBP or Cafeteria Plans
• Central to the concept of flexible benefits plans is the realization that most
organizations' employees represent a diverse cross-section of individuals.
• Rather than trying to fit an "average" benefits plan to a varied workforce, a
cafeteria plan allows employees to select individual benefits they desire
highly and avoid those benefits they do not need or want. (For example,
married couples who would have duplicate medical coverage would be
able to delete one policy and use those benefits dollars in a more desired
benefit category.)
• Moreover, cafeteria plans allow employees to tailor their benefits to their
individual requirements or lifestyles. Younger employees can select a more
comprehensive family health plan or dental insurance, while older
employees can spend their benefits dollars on improved retirement or
disability coverage. In short, a cafeteria plan allows benefits dollars to be
spent in a more satisfying and cost-effective manner.
Broad- banding
• Broadbanding is defined as a strategy for salary structures that
consolidate a large number of pay grades into a few "broad bands."

In a broadband pay structure, the numbers of salary grades are

consolidated into fewer, but broader, pay ranges. In broadbanding,
the spread of the pay ranges is wider and there is less overlap with
other pay ranges.
Broad- banding
Competency-Base Pay
1. Defines Skills
2. Choose Method
3. Training system
4. Formal Testing
5. Design Work
Difference Competency Based Pay and Job
Based Pay
• The employee receives the pay attached to the job regardless of whether
the employee has the necessary competence for performing the job. With
CBP, the supervisor certifies employee competence prior to any pay
increases.
• With JBP, pay changes when one switches jobs. With CBP, one must
demonstrate proficiency prior to getting a raise. Also, one could do a
lower-paying job but still receive a higher pay based on skill. JBP systems
may tie pay to grade or seniority.
• CBP pays for competencies, not seniority. There is more advancement
possible with CBP plans than with JBP. CBP enhances organizational
flexibility because workers' skills are applicable to more jobs, and therefore
more portable.
 Theories of Remuneration
Feedback to employee

Employee set Performance is Employee consider

expectations and rewarded equity of reward and
goals performance

Employee sets new goals and expectations

based on experience
 Theories of Remuneration

Reinforcement Theory

Behavior rewarded Positive Experience Behavior is repeated

 Theories of Remuneration

Equity Theory
• Adam’s equity theory emphasizes to have equity in pay structure of
employee

• If employee feel that their efforts are well rewarded they will put more
efforts and will be satisfied with their job

• In case of inequity feeling they will be de moralized and dissatisfied

resulting into low productivity

Individual Motivation
equity

Internal Perception of Commitment

equity fairness

External
Performance
equity
 Theories of Remuneration

Agency Theory

• In the organizations employer and employees are two main stakeholders

• Employer act as principals and employees assume the role of agent

• The remuneration of employee is agency cost

• Principal tries to agency cost and agent expect to have more agency cost

• The principal (Employer) should try to choose remunerating schemes that

align its own interest with expectation of agents (employees)

• Behavior oriented (merit based pay)

• Outcome oriented (profit sharing, commission)

ESIC 1948
• ESIC includes the medical benefit both for the
employee and employer. It is calculated on the basis
of gross salary/wages/pay per month and the
maximum limit is up to ₹ 21,000/- per month (earlier
it was ₹ 15,000 per month).
• Minimum 20 eligible employees are required to get
registered under ESIC.
• ESIC contribution rates (Reduced w.e.f. 01/07/2019)
• Particulars Earlier Rate Reduced Rate
• Employer Share 4.75%3.25%
• Employee Share 1.75%0.75%
• Total 6.50%4.00%
• So if the gross salary of an employee is ₹ 8,000 p.m,
then
• Employee contribution would be 8000*0.75% = ₹ 60
• Employer 8000*3.25% = ₹ 260
• Therefore Net pay = Gross pay – Total deductions
• The contribution has to be paid within 21 days from
close of the month. If the contribution is not paid in
time, interest @ 12% is payable.
EPF
• Employee Provident Fund (EPF) is a scheme in which you, as an
employee at a government or private organisation, can create wealth
through your working years. This amount earns interest and you can
use it to finance a part of post-retirement life or other goals. In this
scheme, both you and your employer make contributions towards
your EPF. At the time of your retirement, or two months after
changing your job, you can claim the entire amount.
EPF
• The contribution of employees is calculated as: –
• For EPF – 12%(Basic +DA)
• For EPS – None
• For EDLI – None
• The contribution of Employer is calculated as: –
• For EPF – 3.67% (Basic +DA)
• For EPS –8.33% (Basic +DA) or Rs. 1,250/-(8.33% of
15000) whichever is less. If it exceeds the amount is
added to EPF
HRA is partially taxable
• The entire HRA received is not always fully exempt from tax.
The least of the following three will be taken to exempt from tax:
• HRA received from your employer
• Actual rent paid minus 10% of salary
• 50% of basic salary for those living in metro cities
• 40% of basic salary for those living in non-metro cities
HRA for Basic Salary – 23,000
• (Actual rent paid) – (10% of the basic salary) = Rs. 12,000 – (10% of Rs.
23,000) = Rs. 9,700; or
• Actual HRA offered by the employer = Rs. 15,000; or
• 50% of the basic salary = 50% of Rs. 23,000 = Rs. 11,500.
• The least of the above three is the actual amount paid as rent minus 10% of
the basic salary. Hence, Mr. A will get an HRA exemption of Rs 9,700 on his
total taxable income.
Gratuity Act, 1972
• The payment of Gratuity Act was passed in the year 1972 and covers employees engaged in mines,
factories, oil fields, plantations, companies, ports and other such establishments which have more
than ten employees. The gratuity amount unlike provident fund is totally paid by the employer
without any contribution from the employee.
• Gratuity Eligibility
• Following are the few instances when you will be eligible to receive gratuity.
• An employee should be eligible for superannuation
• An employee retires
• An employee resigns after working for 5 years with a single employer
• An employee passes away or suffers disability due to illness or accident

Gratuity Formula
• Listed below are the components that go into calculation of gratuity amount. The amount is also
dependent upon the number of years served in the company and the last drawn salary.
• Gratuity = N*B*15/26
• N = number of years of service in a company
• B = last drawn basic salary plus DA
• House Rent Allowance (HRA): House Rent Allowance is a type of allowance paid by a company to its employees for
accommodation expenses. Employees can avail the HRA exemption under section 10 (13A) of the Income Tax Act
(1961) in accordance with Rule 2A of Income Tax rules. Salaried individuals need to submit rent receipts as proof to
avail the HRA tax benefit. Self-employed individuals do not get HRA exemption but can claim tax benefits under
section 80GG. Salaried and self-employed individuals that live in their own house cannot avail the HRA tax
exemption.
• Leave Travel Allowance (LTA): Leave Travel Allowance is paid by an employer to the employee when the latter travels
with their family or alone within the country. An employee can avail the exemption only twice in four years. It is one
of the best tax-saving tools based on Section 10 (5) of the Income Tax Act, 1961 with Rule 2B. LTA does not include
food, shopping or other expenses incurred during the trip. It is not mandatory to submit documentary proof of travel
but the assessing officers can demand it during the assessment.
• Dearness Allowance (DA): Originally introduced after World War II, Dearness Allowance helps people deal with
inflation. DA is a fixed percentage of the basic salary of an employee where the percentage is dependent on the
location of the employee since the cost of living in India is different based on whether the employee lives in a city,
town, or village. DA is revised twice a year in January and July. Dearness Allowance is usually paid out to the public-
sector employees. It is fully taxable with salary and must be filed in the tax return by a salaried individual in every
financial year.
• Medical Allowance: This is a fixed allowance that is paid by a company to its employees every month. It is taxable
and the salaried individuals can claim tax benefit under medical reimbursement of up to Rs. 15,000 by submitting
the necessary bills and documents as proof. If they fail to submit proof of medical bills to support the
reimbursement, 30% of Rs. 15,000 becomes the taxable amount that can be reclaimed while filing tax returns.
Medical reimbursement comes under Section 80DD of the Income Tax Act (1961). The employer has to pay TDS
penalties if he does not deduct TDS on a medical allowance for which the reimbursement has not been claimed.
• Special Allowance: Special Allowance is an allowance that is paid to an employee to meet specific work-related
expenses and does not fall into any other allowance category. It is exempt from tax up to the extent of the actual
expenditure incurred for carrying out duties in an office. There is no upper limit defined for special allowance. These
allowances are taxable and paid on a monthly basis to the employees.
HR ANALYTICS
 Why Are WeHere?

There are two primary approaches to making decisions;

Opinion/
Evidenced-based
Perception-based VS
Decision Making
Decision Making
 So what is
Analytics?

Analytics is defined as the scientific process The goal of analytics is to gain insight
of transforming data into insight from data which can be used to make
for making better decisions improvements or changes to
businesses.
 ….But HR is not coming to the Party!

Analytics Capability

Finance Operations Sales Marketing HR Functions

Right now, 86% of companies report no analytics capability in the HR function,

compared to 81% of companies that utilize analytics in finance, 77% in
operations, 58% in sales, and 56% in marketing.
 Why HR Analytics?
Many organisations have high quality HR data but still struggle to use it
effectively to predict workforce trends, minimise risks and maximise returns.

HR Analytics will help organisations to:

Increase retention levels Adapt to changing external and
and attract excellent talent internal needs

Predict the impact of Determine key factors that

policies and administration drive employee productivity
on employee performance

Identify what talent factors are

Identify leadership or talent
needed to drive higher levels
gap
of customer satisfaction and
retention
 Why HR Analytics?
Oracle compared the performance of organisations that have implemented the HR
Analytics model to companies that have not and it was discovered that there was a:

58% higher sales per 24% higher net 8% higher sales growth
employee operating income

Source: Oracle – HR Analytics Impact on Organisations

 What is HR Analytics?

Human resources analytics is a process that It is the process of transforming Workforce and
provides organisations detailed insights into Human Resources Function data into insight for
HR programmes and workforce performance. making better people and business decision.
 What is HR Analytics?
Organisations have lots of data elements about their employees.

Performance data Job history Compensation Mobility

Demographic data Assessment Training

This data can be correlated and matched to many different types of business data to help
companies understand profiles and behaviours which create high performance.
 Three critical questions for HR:

What are the most What are the most

How should the success
important activities HR important results
Functions should Engage of HR functions be /outcomes that HR
in? measured ?
function should deliver?

HR Doables HR Measurables/Metrics HR Deliverables

We can’t answer these questions effectively without

Analytics.
 Success of your HR Analytics is determined by the quality of your Questions

Which segment of your Workforce is the Are employees in that segment highly
most critical to the success of your engaged or disengaged?
business?

Are your people better than those of Where do your best employees
your competitors in your critical come from? Which company?
roles/functions? Which University? WhatIndustry?

Are your people better than they were

last year? And the year before?
33
Analytics Maturity Model – Where are you in the Journey?

Predictive
Analytics
Analytics (Foresight)
(Insight ) Attrition rate will
Advance
5% of staff that increase by 10% over
Reporting resigned are in the next 2 years at
(Interpretation) critical roles current incentive rate
Basic Reporting Attrition rate
increased by 8%
(Data) over the last year
180 staff resigned
from the company
last month
34 Analytics Maturity Model – Where are you in the Journey?
In a recent survey done by “Bersin by Deloitte” on Organisations, it was discovered that:

4%
4% of the organisations were Advanced/PredictiveAnalytics
focused on Advanced/ Development of Predictive Models • Scenario Planning •
Predictive Analytics Risk Analysis & Mitigation • Integration with Strategic Planning

10%
10% of the organisations were Analytics
focused onAnalytics Statistical Modeling and Root Cause Analysis to Solve Business Problems•
Proactive in Identifying Issues & ActionableSolutions

30%
Advanced Reporting
Proactive, Operational Reporting for Benchmarking & Decision-Making •
86% of organisations Multidimensional Analysis & Dashboards
surveyed are focused
on reporting
56%
Basic Reporting
Reactive, Operational Reporting of Efficiency & Compliance Measures •
Focus on Data Accuracy, Consistency,Timeliness
Analytics
Framework – 4I
IMPACT INFORMATION
What is going on?
What difference can we
make?

ANALYTICS
MODEL
INTERVENTION INSIGHT
What does it mean?
What can we do with
it?
 Information – What is going on?

What are the leading What critical success From a combination of several
human capital practices factors/quality attributes landmark researches on the
that predicts the success of makes a great HR Function? studies of the impact of HRM
an organisation? practices on organisations, we
have identified 8 Human
Resource Conditions that are key
drivers of success for best-in-class
organisations.
Insight - What does it mean?
Hiring the Right
People

Leadership and A strong

Managerial Performance-
Capabilities oriented culture

Use of competencies
(non-negotiable criteria) Low turnover
in employee selection, 8 HR (particularly in superior
development & performers/ premium
performance CONDITIONS employee group)
management

Effective & Strategic

investment in
A cadre of qualified
employee
replacements
compensation and
development
High levelsof
Employee
Engagement
www.workforcegroup.com
 Intervention & Impact –
What Can we do with it & What Difference will it make?

High Performance Businesses, through analytics identify where they need to

excel, focus energy and resource on those areas, and measure achievement and
impact on business results.
The High Performance Business
Basic Progressive Pioneering

• Hiring right

• Strong Performance
Oriented Culture
• Low turnover in Premium
EmployeeGroup
• A cadre of qualified
replacements
• High Level of Employee
Engagement
• Strategic investment in
Development & Compensation
• Use of competencies

• Leadership
Analytics Success…. Always start with a GreatQuestion

Data-‐Driven Sourcing
• Sources engineering talent at Waterloo University (Toronto)
• Virtuous cycle of investment and payoff.
 7 Steps AnalyticsImplementation Framework

01 02 03 04 05 06 07
Start with a Develop your Collect Conduct Data Generate Key Create Monitor,
Business Analysis Plan Necessary Analysis – Insights and Initiatives & Measure &
Question & Build your Data & Ensure Ensure Rigor Tell a Story TakeActions Adjust
Team Completeness
 Common Analytics Techniques
Correlation Analysis Trend Analysis Sizing and Estimation
Finding the relationship Determining the pattern Giving informed
between two factors. that events and activities estimates of expected Most
seem to be heading values. Common
toward.

Profiling
Exploration of
information based
on known qualities.

Customer Life Cycle Segmentation Predictive Analysis and

Progression of steps Dividing factors into Time Series
a customer goes through when smaller groups with Using information of past
considering, purchasing, using, similar needs, interests events to guess future
and maintaining loyalty to a and priorities.
product or service.
 Analytics Skill Set

Soft Skills Technical Skills

Business Strategy Data Mining

Complete Industry Statistics

Knowledge
Negotiation Computer Programming (R,
Python)
Communication Database Management (SQL)

Project Management Data Representation

Human Resource Quantitative andQualitative

Management Research
Other Analytics Software

Microsoft Excel Microsoft dynamics innervation

Visier
SAP success factors
 In Conclusion…..

• From our perspective, HR Analytics is a required business process and an

indispensable part of being competitive within any industry.