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RESEARCH REPORT

ON

STUDY OF PERFORMANCE MANAGEMENTSYSTEM IN B.H.E.L AT VARANASI

A report prepared and submitted for the partial requirement andfulfillment of the MBA Program at IMS SHEPA, Varanasi

SUBMITTED TO: SUBMITTED BY:

Mr B.B. Singh Ankit Singh

MBA 4 th Semester

DECLARATION

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I hereby declare that the project report titled STUDY OF PERFORMANCEMANAGEMENT SYSTEM is a genuine research work undertaken by me under theguidance of Mr. Manvendra Gupta ( HR BHEL). This information has been collectedfrom genuine authentic sources.

The report is being submitted in partial fulfillment of the requirement of MASTERS OFBUSINESS ADMINISTRATION from IMS Shepa, Varanasi.

Ankit Singh

MBA (HR)

ACKNOWLEDGEMENT

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I take this responsibility to express my profound and sincere gratitude to IMS Shepa,vns. for providing me with the opportunity to explore the corridors of the corporate worldand gather invaluable knowledge and practical experience via the Research Report.

I take the privilege of offering a deep sense of gratitude and indebtedness to Mr.Manvendra Gupta (HR BHEL), Varanasi, for providing me their able guidance andinspiration to complete the Research Report.

Above all no words can express my gratitude to my parents and friends who supportedme through thick and thin difficulties faced by me during the preparation of the project. Ialso owe a sense of gratitude to my faculty members, respected, Mr. B.B. Singh whoguided me throughout my research report and provided structured guidelines to work and

progress.

Last but not the least; I would like to thank all the employees of BHEL for their valuablesuggestions and constant encouragement.

The expertise in this study belongs to those listed above. Any errors are mine.

Ankit Singh

TABLE OF CONTENTS

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ON.................................................................................................................................................. 1

EXECUTIVE SUMMARY.............................................................................................................5

OBJECTIVE OF THE PROJECT...................................................................................................6

PROFILE OF BHARAT HEAVY ELECTRICALS LTD..............................................................8

PERFORMANCE MANAGEMENT SYSTEM IN BHEL...........................................................21

MAP PERFORMANCE CYCLE................................................................................................. 27

BALANCED SCORECARD (BSC).............................................................................................28

BEHAVIOURAL COMPETENCIES OF MAP................................................................... ........34

Part B- SKILL/ COMPETENCY ASSESSMENT........................................................................37

RESEARCH METHODOLOGY..................................................................................................44

DATA ANALYSIS.......................................................................................................................45

RESEARCH FINDINGS.............................................................................................................. 56

CONCLUSION.............................................................................................................................57

SUGGESTIONS...........................................................................................................................58

LIMITATIONS.............................................................................................................................59

QUESTIONNAIRE...................................................................................................................... 60

BIBLIOGRAPHY.........................................................................................................................62

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EXECUTIVE SUMMARY

The Performance Management System is a process of setting objectives, making plans to

achieve those objectives and accomplishing the desired results. Rewards and recognitionare the end stage of this process. Organizations use this system to assess the performanceof an individual, a team, a function and then the organization as a total. In this project, thewhole performance management system is described for the company BHEL.

This cycle starts when BHEL signs a Memorandum of Understanding (MoU) with theGovernment of India. In this memorandum the vision, mission and values, targets andaction plans are mentioned. In BHEL, system have been devised to cascadeOrganizational Goals into individual goals by framing out objectives of the companyfrom the MoU at corporate level and there by preparing a Balance Score Card both at

corporate and unit level. The summarized feature of this process is sequentially breakingdown the organizational goals into an individuals e-MAP.

This project describes about the E- Map system i.e. the Performance Management Systemwhich is followed in BHEL. This project also describes the problems faced by theappraisees and the appraisers in this system. It also elaborates about the steps taken by theappraisers to improve the performances of the appraisees so that their efficiency can beincreased and later the rewards and recognitions are given in the form of promotions,incentives and empowerment.

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OBJECTIVE OF THE PROJECT

To study the process and to understand the importance of Performance Management

System in BHEL that synchronizes the performance of the employees so as to make thework effective.

To analyze the Performance Management System (e-Map) of BHEL in detail andits effectiveness.

To analyze the problems faced by the appraisee and the appraiser in this system.

To analyze the steps taken by the appraisers for the improvement of the

performances of the appraisees.

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COMPANYPROFILE

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PROFILE OF BHARAT HEAVY ELECTRICALS LTD.

Foundation:

BHEL is the largest engineering and manufacturing enterprise in India in the energyrelated /infrastructure sector .BHEL is one of the nine large public sector undertakingsknown as Navratnas or Nine jewels. BHEL offers over 180 products and providessystems and services to meet the needs of the core sector like: power, transmission,industry, transportation, oil & gas, non-conventional energy source andtelecommunications.

BHEL was found in 1950s. The operation are organized in three business sectors; Power,Industry- including Transmission, Transportation, Telecommunication & RenewableEnergy and overseas business. Today BHEL has a wide-spread network comprising 14manufacturing units, 8 service centers, 4 power sector regional centers, 18 regionaloffices, and a large no. of project sites spreads all over India and abroad. BHEL is one of the largest exporters of engineering products and services from India. BHEL hasestablished its references in around 60 countries of the world, ranging from United Statesin the west to New Zealand in the Far East. Its export range include: individual productsto complete power station, turnkey contracts for power plants, EPC contracts, HV/EHVSub-Stations, O&M services for familiar technologies, specialized after-market serviceslike Residual Life Assessment(RLA) studies and retrofitting, refurbishing & overhaulingand supplies to manufacturers & EPC contractors.

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THE VISION, MISSION & VALUES OF BHEL:

BHEL developed its Vision, Mission and Values in 1996, which were reviewed andrevised in 2002 and further revisited in 2006.

A). THE COMPANYS VISION AND MISSION:

Vision - A World Class Engineering Enterprise Committed to enhancing stakeholdersValues.

Mission - To be an Indian Multinational Engineering Enterprise providing total businesssolutions through quality products, system and services in the field of Energy, Industry,Transportation, Infrastructure and other potential areas.

B). The Core Values:

. Zeal to excel and zest for changes

. Integrity and fairness in all matters

. Respect for dignity and potential of individuals

. Strict Adherence to commitments

. Ensure speed of response

. Faster learning, Creativity and team-work

. Loyalty and Pride in the company

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BHEL Organization:

BHEL Operations are organized around three business sectors: Power, Industry &overseas business. These are catered to by a country wide network of-

. 14 Manufacturing units

. 8 Service centre

. 4 Power sector regional centre

. 18 Regional Offices

Present Status:

# The turnover of BHEL was Rs.421.4 Billion in the year 2009-10.

# The Turnovers and order inflow have almost doubled in just three years, and the profit before.

# Tax and Net profit have doubled in two years.

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Central Foundry Forge Plant, Varanasi

The Central Foundry Forge Plant was set up at Varanasi with French collaboration. Theconstruction started in 1974 and production was commenced in 1976. This plant has anin-built high degree of sophistication normally associated with much larger plants & hassuccessfully developed various intricate castings and forgings, which were hithertoimported. CFFP has successfully manufactured various types of steels, e.g. creep resistantsteel, heat resistant steel, stainless steel, armour steel etc. as per Indian and InternationalStandards.

Castings (500 kg to 50T piece wt)

1. Plain carbon Steels

2. Alloy Steels3. Creep Resistant steels

4. Stainless steels

Forgings (Upto 55T/pc wt)

1. Rotors (Max dia 2000mm)2. Discs(Max dia 3500mm)

3. Tube Sheets

4. Blooms

5. ESR Components

Manpower

1. Well trained professionally qualified

2. 147 Engineers

3. 221 Supervisors

4. 870 workmen

Steel Melting

1. 3Arc Furnaces- 10T,30T &mp; 70T

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2. 70 T VAD/VOD Furnaces

3. ESR Furnace

Press

1. 2650T & 9000 T Pneumatic Forging press2. 18M HT Furnace,Circular Furnace,Mist Quenching Facilities etc.

Machining Facilities

1. 7.3 M V. borers, WD160/220 H.Borers, 18M Deep Hole Boring machines

2. 18 M/10M centre lathes etc.

Testing Facilities

1. Latest Spectrometer, Hydrogen , Carbon/Sulphur determinators

2. No of sophisticated US Flaw detectors, Boroscopes, Radiographic Chambers and creeptesting facilities.

Quality Certification

1. Well known Boiler board certification

2. Approved by LLoyd Register of Shipping

3. IS0-9000 Certification by BVQI

4. TUV certification

PROFILE OF HEAVY ELECTRICAL EQUIPMENT PLANT (HEEP):

It is one of the four major manufacturing units of BHEL. It was established in the year 1962 with the Russian collaboration. HEEP follows the corporate policies on HR,Materials Management, Finance Management and Work Management etc. and focus oncustomer needs captured through S-maps. To align objective of the units and its differentfunction with corporation, unit has developed its business Policy, CSFs and functionalPole Star Statements. HEEP is consistently earning profit since its breakeven in 1974-75.It achieved an all time high turnover of Rs.20.03 billion, PBT of Rs.4.41 billion, andEVA of Rs.2.14 billion in 2006-07. The 210, 250 and 500 MW thermal sets, made byHEEP, constitute of 65% of total thermal coal based power plants. These contribute to71% of total generation by coal based thermal sets in the country. In 2005-06 HEEP

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added 1250 MW to National grid and 312 MW added in Libya by export. And latestHEEP added 1500 MW NEW TURBINE Shop in Varanasi Grid.

The Important Milestones in the History of HEEP (up to March 2009)

Year Event

1962 Technical collaboration with Prommasho export, USSR, for setting up HEEP

1967 First product (Electric Motor) rolled out

1969 Manufacturing of first 100MW steam turbine

1971 Manufacturing of first 100MW Turbo Generator

1974

.Breakeven achieved

.Technical collaboration with KWU(Siemens), Germany for coal basedthermal sets

1976 First 200MW coal based Thermal Set commissioned

1983 First 500MW coal based Thermal Set commissioned

1989 Technical collaboration with KWU for gas turbine

1991 Collaboration with Oto-Melara, Italy, singed for Defense Project

1993 Accreditation of ISO-9001 Quality System

1995 TQM Movement launched in HEEP

2000 Accreditation of ISO-14001 Environment Management System

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2001Technical collaboration with KWU for coal based thermal setup up to

1000MW

extended for 10 years

2002 Accreditation of OHSAS-18001

2004 New Blade Shop Established2006

2008

2009

HEEP wins CII-EXIM Bank Prize for Business Excellence

HEEP employees won Prize for setting good quality product

Provided Biggest Dynamo to JAPAN.

Range of Products:

Main products of the unit are higher rating Thermal sets (210MW and above). Apart fromthese HEEP also manufactures Hydro sets, large size AC motors, naval Guns (SRGM).The percentage distribution of product profile is as follows-

SNo. Products Percentage of Turnovers1. . Steam Turbine & Generators : 210-800 MW

. Condensers, Heat Exchangers and Pressure

vessels

. Nuclear Turbines & Generators : 210-540MW

. Gas turbines & Generators : 156 MW (ISO)

91.5%

2. Hydro Turbines & Generators : 5-250 MW 4.5%

3 Defense Equipment : Super Rapid Gun

Mounting (SRGM)

2.5%

4.Large size AC Motors

1.5%

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MANUFACTURING:

. Marketing and Servicing:

. Manufacturing and other facilities

Manufacturing Plants:

HEEP has state-of-art manufacturing facilities to deliver 3500MW of power generatingequipments. HEEP has absorbed world class technology through collaboration with M/sSiemens, Germany and plan to modernize its manufacturing facilities to enhance the

manufacturing capacity to 5250MW and its capability to manufacture higher rating sets.Facilities added for manufacturing of Turbo Generators with total Impregnated Stator core enabling development of Turbo Generators with higher efficiency. New Blade Shopwith world-class machine tools has led to indigenous developments & manufacture of advanced blades with improved heat rate. HEEPs product profile necessitates tailor made designs with contemporary features. These products are realized through modernmachining processes, insulation systems, fabrication, assemblies and testing.Transportation of large and heavy consignments is done through prudent logisticmanagement.

Major Manufacturing Units are:

. Block - 1 & 4 : Electrical Machine Shop

. Block - 2 : Fabrication Shop

. Block - 3 : Turbine Manufacturing

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MARKET AND COMPETITION:

Market-

HEEPs customer profile ranges from state electricity boards, Govt. Power utilities like NTPC, NPC and NHPC to IPPs like Reliance Energy. HEEP has also exported gas

turbines sets to Libya and Iraq. Power Sector Regions of BHEL are its key internalcustomers. Their key customer, NTPC has drawn up plan for capacity addition of 17,000MW by 2012. HEEP has planed for execution of 34,619 MW by 2012.

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Competition -:

Acquisition & mergers by Power Equipment Manufacturers have left BHEL, Siemens,GE and Alstom as major players in India. SEPCO (China), LMZ (Russia), Dang Fang(China) and Skoda (Czech Rep.) are emerging competitors. To meet the emergingchallenges, focus is given on increasing manufacturing capacity and introduction of newtechnologies. It helps HEEP to maintain it leading position in domestic market.

Challenges posed by china and other competitors has prompted HEEP to becomeaggressive in introducing 300/350 MW sets to be ready for 800MW sets. HEEPs positionhas further strengthened as global competitors could not fulfill expectations of Indiancustomers. BHEL was offered work of RAYALSEEMA PROJECT after failure of CMEC, China. Similarly, BHEL is part of consortium in restarting Dabhol project after failure of Enron.

Changing Business Environment -:

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Power sector has to grow over 10% annually commensurate with GDP growth of 7-8%.Thus, the demand for thermal sets will remain high. Central Electricity Authority (CEA)is the guiding authority for Power Sector strategies in our country. Representatives of BHEL and power utilities are members of various committees formed by CEA. HEEP

will strategically concentrate on higher rating coal based thermal sets to fulfill thecountrys vision of adding 107,000 MW capacity to achieve POWER ON DEMANDby 2012. Govt. of India has reposed its faith on BHELs capabilities and has asked it toget prepared for bulk ordering of 8 nos. 800MW sets in collaboration with Siemens.CEAs stress on R&M of ageing Power Plant is also providing business opportunity toHEEP.

Strategic Challenges -:

The fast changing power scenario emerging with rapid growth in national power capacityhas given unit a major challenge of establishing power infrastructure in close in co-ordination with its key customers. To cater the needs of higher rating sets of 800 MW,HEEP has collaboration with Siemens. To capture future customer needs andexpectations and emerging market scenario Strategic Map (S-Map) is prepared.

PRINCIPLE FACTORS OF SUCCESS:

Satisfied Customers:

Customer satisfaction and success is reflected in the theme:

Grahak Safal Hum Safal.

The business policy also focuses on customer focused business leadership. HEEPregularly conducts independent Customer Satisfaction Surveys that are used to identify

priorities of customers and draw out strategy accordingly. Focused efforts of HEEP hasresulted in improvement of customer satisfaction index from 55.39 in 2004 to 70.14 by2005 having most of the parameters better than its competitors and sister units. In 2006

perception of customers was collected internally.

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Excellence Initiative for performance Improvement:

Excellence initiative is their Balance Score Card (BSC), Overall Equipment Effectiveness(OEE), Award Scheme (IMPRESS Copyright of HEEP) and performance appraisal

through e map. To measure and increase the effectiveness of these initiatives HEEPuses internal audits (Financial, ISO 9000, HSE audits, OEE audits). Engineers arefrequently deputed to collaborators works to enhance technical knowledge. KnowledgeManagement & intellectual Property Right Management has been identified as CSFsince 2004.

Partnership with Suppliers:

To remain competitive it is vital for HEEP to reduce the cost and procurement time cycleof raw materials, components and assemblies. Strategic Outsourcing of processes,components & assemblies is considered the most important CSF to meet unitschallenges of cost & cycle time reduction. To this end, HEEP has focused on increasingsupplier base & win partnerships through one to one discussions and MOUs. A B2B

portal has been installed for communication and transparency in dealing. HEEPs sister unit CFFP, Collaborator Siemens, SAIL and IOC are the key suppliers and unit hasmaintained the partnership with them for more than 15 years. Ancillaries developed byHEEP are vital to its success and are supported with technical guidance and training,material, special tools, calibration and testing facilities.

WORK CULTURE:

Vision, Mission and Values drive the organization behavior and work culture towardsexcellence. One of the major strength of HEEP, Varanasi is its free, open participation of the employees in improvement projects, Suggestion, quality circle and other newinitiatives. HEEP has been Pioneer among the other BHEL units to adopt manyexcellence initiatives. Special thrust on IT has led to development of many engineeringand business application by in-house development team. To promote excellence, in-housecompetitions are organized through out the year. Unit has given award to the winners inSpecial Award Distribution Function. HEEP has been awarded National Award for 14consecutive years by INSSAN and National Award for Excellence in EnergyConservation as Energy Efficient Unit by CII.

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Competent and Educated Employees:

The capable and skilled HR asset of HEEP has placed it among top engineeringorganizations in India. This is aptly demonstrated in the records number of prestigious

National Award like Vishwakarma and Prime Ministers awards won by employees.

Employee Strength:

Employee Profile ( As on 30 May 2010)

Category Number Executive 952+124 (ET)Supervisors 938+111 (ST)Workmen 5883Total 8008

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PERFORMANCEMANAGEMENT

SYSTEM IN BHEL

PERFORMANCE MANAGEMENT SYSTEM IN BHEL

E-MAP (Moving Ahead through Performance) is the Performance Management Systemwhich is followed in BHEL. This system was introduced in the year 2002-03.

E-MAP aims at creating alignment of your goals with those of the company and enablesyou to effectively manage performance- for yourself and your team.

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This system covers Frontline Executives and Middle level Executives of BHEL. FrontlineExecutives fall in the category from Engineer to Manager (E1-E4) and Middle levelExecutive starts from Senior Manager to Additional General Manager (E5-E7).

As a trial measure, in the year 2001-02 MAP was filled manually, i.e. it was not e-Enabled. From year 2002-03 it was switched over to e-Enabled. Upto year 2001,

performance appraisal of an individual was filled in the form of Annual ConfidentialReport (ACR).

The features of MAP have been designed to reduce subjectivity and individual biasnessthat may impact the effectiveness of a performance management system.

The system is divided into two parts:

Part A: Key Result Area (KRAs)

Part B: Skill/ Competency Assessment

THE MAP LOGO

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The Map logo represents:

Excellence

Focus on people at the center of the system

Sharp growth through performance

Alignment

Measurement

Definition of Performance

Definition of Performance in MAP is based upon Key Result Areas or KRAs and RoutineResponsibilities.

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~ KRAs are "critical outcomes towards which effort is directed to achieve desired business results."

~ Routine Responsibilities are significant on-going tasks or outcomes that areundertaken or delivered on a day-to-day basis.

Unique Role and Responsibility (URR) templates provide the KRAs, relative weight of KRAs and Routine Responsibilities, the Competencies and their required ProficiencyLevels for a role. The URR Template in MAP helps deliver consistency and clarity onexpected performance measures to Appraisees and Appraisers alike.

MAP allows the Appraisee to define the performance measures applicable to theAppraisee's situation using a combination of KRAs and Routine Responsibilities.

The achievement against targets set for each of these will together constitute theAppraisees Performance Plan in the Performance Cycle or Period.

Cascade of Performance Measures

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Cascade refers to the process of aligning organizational goals to individual goals in aseries of steps. This is done by translating the goals that are identified at theorganizational level into business sectors, units, functional and departmental levelscorecards; and Onwards in the form of KRAs to individuals who form a part of theseunits. Cascade of unit / department level goals to individual KRAs ensures alignment andthat the individual and group objectives and results contribute directly to achievement of organizational results.

Cascading of goals ensures that all efforts within the organization are focused towards acommon goal or purpose at the top. The process also ensures that interdependencies - the

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set of outputs and factors internal to BHEL that impact achievement of a KRA by a teamor individual- are taken care of in a holistic manner.

In MAP, the process of Cascade has been used to

Breakdown targets from the organizational level to business sector / unit to

department and individual level Identify the Key Result Areas or KRAs applicable to unique roles described in the

URR Templates

Ensure uniformity in Stretch so that the degree of difficulty in individual targetsfollows a cascade of at least the same degree as that of the business sector / unit /organization

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MAP PERFORMANCE CYCLE

Performance Cycle at a Glance

A Performance Cycle refers to the year for which your performance is being evaluated.

The Performance Cycle of MAP is one year coinciding with BHEL's financial year.

MAP follows an April to March cycle and consists of three key phases:

1. Performance and Development Planning

2. Mid Year Review

3. Final Review

The figure below provides an overview of the Performance Cycle with key dates for each phase.

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PERFORMANCE AND DEVELOPMENT PLANNING

Performance Planning Phase of MAP is initiated in the month of March upon thefinalization of the draft budget for BHEL. The targets finalized for the Unit, ProductGroup, Department and consequently the Section will serve as the starting point for anindividual to do his Performance Planning.

BALANCED SCORECARD (BSC)

The Balanced Score Card of the company is prepared at the company level at the beginning of the year based on the Strategic Plan as well as the MOU and Budget targetsdecided for the year.

Based on this, the Balanced Scorecards are also prepared for the following levels:

Unit Head Level Product Group / Function Head Level Department Head Level Section Head Level

The Strategic Objectives of the Company / Unit / Product Group (PG) / Deptt. / Sectionfor a given financial year is outlined in the Balanced Scorecard prepared for that Level.

Although the Balanced Scorecard is prepared outside MAP, it is critical for the success of the system. The individual Performance Plans are derived from the Section Level BSCwhich will derive its strategic objectives and targets from the Department/ NC/ Unit andCompany level BSCs through a process of cascading, thus ensuring proper alignment

between the objectives /targets flowing from top to bottom.

Workflow of Performance Planning Phase:

Discussion with Appraisee

28

AcceptsAccepts

Mapping of Appraisee by

Appraiser or UnitHR

Planning byAppraisee

Appraiser Reviewer

Plan

Approve

Edits after Discussion withAppraisee

Edits after Discussion with AppraiseeReviewee

Appraisee

Submits

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Creating the Performance & Development Plan (P&DP)

The Performance Plan of an individual essentially consists of one section KRAs. Thisis the essential component of any Performance Plan and the individual is expected to fillin this section adhering to all guidelines in order to be able to submit his plan to his

Appraiser.

1. Selecting the KRAsThe Appraisee will select relevant KRAs from the KRA Master of his function (i.e. thefunction to which he has been mapped). A minimum of six and a maximum of fifteenKRAs can be selected. (max. 15 from own KRA Master; 5 optional which can be takenfrom KRA Masters of other functions so as to ensure that the total no. of KRAs per plandoes not exceed 15).

2. Target Setting and Action Plans for KRAs

For each KRA, 5 levels of performance must be defined by the Appraisee that quantifythe extent of achievement in a given timeframe (L5 being the best and L1 being thelowest level of performance)Along with these, the Appraisee will develop an Action Plan consisting of specific stepsrequired to achieve the target for each KRA.

3. Assigning WeightageThe Appraisee will propose weightages between 5% and 25% for each KRA. The totalweightage for KRA (C) should be equal to or more than the Minimum Weightage for KRA(C) prescribed for the relevant URR to which the individual has been mapped. The

total of all KRA weightages should add up to 100%. Maximum limit of weightageshave been suggested for all KRAs across all functions for all the categories of URRs.Executives while assigning weightages to the KRAs selected by them in their plancannot exceed the maximum permissible weightages specified against each KRA. Thisis ensured through inbuilt system checks.

The P&DP is now ready for submission.

Obtain Appraisers and Reviewers Sign-off

After creating his P&DP, the Appraisee will submit his plan to his Appraiser. If theAppraiser wishes to modify the plan, he will discuss the same with the Appraisee andmake the necessary modifications. Thereafter, the Appraiser will forward thePerformance Plan to the Reviewer for final sign-off. In case the Reviewer wishes tomodify the plan, he can make the required modifications in the Plan after discussingwith the Appraisee and Reviewee and then grant final approval.

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MID YEAR REVIEW

Mid Year Review is an interactive feedback session between the Appraisee andAppraiser, conducted during the month of October for the half-year ended September 30.It is a mid-cycle process for reviewing and tracking achievements thus reducing the scopefor year-end surprises.

The Mid Year Review does not result in a performance score and will be treated as a'course correction mechanism" wherein the Appraiser guides the Appraisee on whether the Appraisee is on track to achieve the Performance and Development Plan finalised inApril. The Appraisee is able to incorporate these inputs to ensure achievement.

Mid Year Review begins with the Appraisees Self-Appraisal. In his self-appraisal, theAppraisee will comment on his/ her current level of achievement on KRAs, which willthen be discussed with the Appraiser for his feedback and inputs. During this phase, theAppraisee also identifies both behavioral and functional competencies for his

Development.

Mid Year Review Process

Submits

Creating the Development Plan using Competencies and Development PlanSection

Development Planning in MAP focuses on building Individual Capability usingCompetencies.From the list of Functional & Behavioral Competencies identified for the function, theAppraisee will identify a minimum of one and maximum of three competencies during

this Phase. These will be taken as training requirement which will be met in thefollowing year. The urgent functional competencies will be arranged internally by thedepartment.Documentation of the Performance Discussion & completing the Competency Sectionconcludes the Mid-Year Review Phase of MAP.

FINAL REVIEW

30

Appraise does self

review of KRAs &identifies Competencies for

Development

Appraiser gives hiscomments & feedback

Mid Year Review

Completed

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The Final Review Phase will begin with the Appraisees self-appraisal wherein he/shegives the assessment of Target Achievement on each KRA defined in the PerformancePlan (Part-A).The Appraiser will review the outcomes of self-appraisal and give his own assessmentof the achievement of the targets in the performance plan for each KRA. In addition, hewill also give his assessment on the Skills/ Competencies defined in Part B.

Final Review Process

Submits

OR

Rejects After

Discussion

After appraisal by Appraiser, the plan will come back to the Appraisee for hisacceptance of the assessment done for KRAs (the assessment of Part B will not bevisible to the Appraisee). If the Appraisee feels that his Appraisers' Assessment is

31

OR

Rejects after discussion

AcceptsSends back Appraisee

does Self

Assessment

of KRAs

Appraiser

gives his

assessment of KRAs &Part B

Appraisee gets tosee Appraisers

Assessment of KRAs

Reviewe

Gives Fin

AssessmenKRAs & P

B

Part B

Accepting Authority(PG/Function Head or Unit Head, as the case

may be) does FinalAssessment of Part B

Final Composite Scoregets calculated in thesystem after allotting

weightages to Part-A andPart B, also taking intoaccount Deduction of

Marks for LateSubmission of Part-A, if

any

Final Score of MAP Part-A iscommunicated to Appraisee

along with skill/competenciesfor development.

R equests Discussion

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correct, he can Accept and forward it to his Reviewer. However, in case of any issuesregarding the assessment, the Appraisee can request for a "Discussion" with hisAppraiser. After the discussion, the Appraiser will finalize his assessment and send it

back to the Appraisee. The Appraisee at this stage can either Accept the assessment or Reject it. In either case the plan will go to the Reviewer with the appropriate messagefor his final assessment.

The Reviewer will then give his assessment on the KRAs which will form the basis for calculation of the Consolidated Score of MAP for the individual. He will also give hisassessment on the Skills/Competencies specified in Part B.Thereafter, Part-B alone will travel forward to the Accepting Authority for his finalassessment. Once this stage is complete, the Composite Score will get calculated in thesystem.The Final Performance Score of MAP (Part-A) will be visible to the Appraisee on hisdashboard under the link Final Review. Also visible will be those Competencies of Part B in which he has been given a final score of 2 or less on a five point scale.The feedback during Mid Year Review will be taken into account to significantly addvalue to the Final Review. The Appraisees self-appraisal will not directly contribute tothe Performance Score but will be viewed as the Appraisees opportunity to sharehis/her perspective on his performance.Feedback and Coaching by Appraiser will be a key component of the Final Review asthis serves as an important input into the next cycles Plan.

TOOLS OF MAP

The following tools are used in the MAP:

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1. Rating Scales.

2. Competencies and development plan.

1. RATING SCALES

Performance defined in MAP will be evaluated using 5-point Rating Scales. These RatingScales will be used to assess the extent of accomplishment on KRA Targets, RoutineResponsibilities and Competencies.

One common scale will be used for assessing accomplishment on KRAs and RoutineResponsibilities, while another scale will be used for assessing accomplishment onCompetencies.

Rating KRAs and Routine Responsibilities

KRAs and Routine Responsibilities have a 5-point scale where each rating has beenarticulated and explained.

Rating Competencies

The 5-point Rating Scale for Competencies is different from the one used for KRAs andRoutine Responsibilities.

The Appraisee will be evaluated on all Competencies in the URR using the CompetencyScale.

Each Rating on the scale has been articulated to describe the extent to which anAppraisee has displayed the behaviors described in the required Proficiency Level of theCompetency.

Based upon the behaviors observed, the Rating that best describes the set of displayed behaviors is chosen as the Rating on that Competency.

2. COMPETENCIES AND DEVELOPMENT PLAN

Competencies

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Competencies are skills and abilities described in terms of behaviors that are coachable,observable, measurable and critical to individual performance skills.Competencies form the foundation of what capabilities are required for the successfulexecution of roles and responsibilities, thereby driving functional, unit and organization

performance.

Competencies have been classified into two:a. Behavioral Are Competencies that define behaviors or attitudes required

for performing certain jobs. b. Functional / Technical Competencies which relate to knowledge and skill

required for performing the job are called technical /functionalcompetencies.

Accordingly, there are two sets of Competency Masters in MAP:a. Behavioral Competency Masterb. Functional Competency Master

The Behavioral Competency Master comprises a list of 18 competencies which arecommon for all Functions.

The Functional Competency Master comprises Function-wise list of Competencies pertaining to each function.

Development Plan

The Development Plan Module has been provided with the Mid Year Review Phasewhen the individuals will identify their development needs for the next year from thetwo sets of Competency Masters. The unit HRDC/HRDI will take inputs from thismodule to organize group training programmes in the subsequent year. Training needswhich need to be fulfilled immediately can be arranged for by the concerneddepartments.The Appraisee will be required to select a minimum of one Competencyfrom each of the two Masters, and a maximum of three Competencies from both Masters

put together. These would be competencies which the individual would like to develop/improve upon for better performance on the job.

BEHAVIOURAL COMPETENCIES OF MAP

1. Planning and Organizing2. Initiative

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3. Commitment to Quality4. Creativity and Innovation5. Interpersonal Relations6. Cost Consciousness7. Strategic Thinking8. Customer Focus9. Decision Making10. Risk Taking11. People Capability12. Analytical Ability13. Communication Skills14. Teamwork 15. Achievement Orientation16. Negotiation Skills17. Problem Solving18. Knowledge of Business Environment

FEEDBACK AND COACHING

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The process of continuous Feedback and Coaching is an inherent and critical part of MAP.

The Mid Year and Final Reviews are specifically focused on Feedback and Coaching andhence require the Appraisee and the Appraiser to have a formal feedback session.

For Feedback and Coaching to be truly effective, it should be provided and received onan on-going basis. When used effectively, Feedback & Coaching is a powerful means of

positively impacting performance.

Feedback and Coaching helps an Appraiser in both obtaining information and providinginputs on how an Appraisee is performing and whether or not he / she is headed in theright direction. It is also an opportunity for the Appraisee to solicit resources and helpthat may be required for enhancing his/ her own performance.

Most people are comfortable in providing positive feedback. However, they are hesitantto initiate a conversation that involves sharing of negative or unpleasant performance-

related information. Such hesitation needs to be overcome, considering the importance of feedback in correcting the performance level of the Appraisee, and the consequent benefitto the Appraisee's career.

Coaching Impacts Performance

Feedback is of various types: Positive feedback

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Corrective feedback Feedback focused on identifying obstacles to performance Feedback for the purpose of sharing information etc.

Part B- SKILL/ COMPETENCY ASSESSMENT

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The Objective of Part B is to assess the Skills/ Competencies possessed by individualsand factor in this assessment for the purpose of Promotion decisions.

There are two sets of Skills/ Competencies mapped to different levels of executives asfollows:

E1A to E5 Skill/ Competency Set-1

E6 & E7 Skill/ Competency Set- 2

The weighted average score of Part-A and Part-B will give the Composite Score of theindividual for that year which will be reckoned for promotion purposes only. Thefollowing weightages operate between Part-A (kRAs) and Part-B (Skills andCompetencies) while calculating the Composite Score:

EXECUTIVEBAND

WEIGHTAGE OFPART-A(KRAs of e-MAP)

WEIGHTAGE OFPART-B(Skills/ Competencies)

E1A to E3 80% 20%

E4 & E5 70% 30%

E6 & E7 50% 50%

The following formula is used to arrive at the Composite Score:

(Score of Part-A * Weightage of Part-A) + (Score of Part-B * Weightage of Part-B)

The Score of Part-A will constitute the Performance Score of the individual for theyear whereas the weighted average Score of Part-A and Part-B will constituteComposite Score of the individual for the year.

The Authorities for Assessment of Part-B for various levels of executives are:

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For E6 & E7

Appraiser Reviewer Unit Head

For E1A to E5

Appraiser Reviewer PG/Function Head

Unlike Part- A, there is NO Self Assessment of Part-B by the Appraisee and the scoreof Part-B as also the Composite Performance Score of Part-A and Part-B will not beshared with the Appraisee. The ratings will be given on a scale of 1-5. 5 being the bestand 1 being the worst. Any Competency getting a rating of 1 or 2 will be displayed to theAppraisee as an area for development.

LIST OF SKILLS/COMPETENCIES TO BE ASSESSED FOR EXECUTIVES

IN GRADES E1A TO E5

(On a scale of 1 to 5 5 being the best and 1 the lowest)

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SN SKILLS/ COMPETENCIES

1 Functional / Technical Knowledge : Possesses knowledge related to function, understands andappropriately applies technical ability related to functional / technical expertise.

2 Leadership : Motivates & develops individuals. Encourages team members in decision making.

3 Interpersonal Relations & Team playing: Sensitive to the needs and problems of others.Collaborates with colleagues to seek solutions that are beneficial to the team. Supports otherscontribution and helps in achievement of teams goals.

4 Analytical ability: Displays the ability to analyse information and draw logical conclusions.

5 Openness to continuous learning: Assesses and recognizes own strengths and weaknesses; pursuesself-development.

6 Communication : Displays skill to give and receive instructions accurately; has ability to presentissues lucidly and share information with all concerned.

7 Initiative & Resourcefulness: Able to act effectively / imaginatively to accomplish mission ; takesinitiative to solve problems/ improve processes.

8 Achievement / Result orientation: Displays zeal to achieve by aggressively and passionately pursuing targets which have a standard of excellence.

9 Sense of Responsibility / Tenacity: Meets targets; shoulders responsibility; minimal follow-uprequired.

10 Quality of work: Displays thoroughness, accuracy and general excellence of output ; produceswork free from errors; shows consistency of output under varying conditions.

11 Customer Focus & Service Orientation : Displays ability to strive for success of both internal &external customers through high responsiveness and delivering value.

12 Administrative / Executive ability: Displays a bility to objectively view administrative situationsand demonstrates courage in enforcing financial and personal discipline; has ability to appraisesubordinates objectively.

13 Decision Making & Flexibility: Displays a bility to diagnose and analyse problems and generate

effective solutions by taking practical and calculated decisions; is open and flexible when required.

14 Planning & Organising : Displays ability to plan dynamically and implement the same for achieving desired goals.

15 Creativity & Innovation: Develops new insights into situations; encourage new ideas andinnovations; solves problems creatively.

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LIST OF SKILLS/COMPETENCIES TO BE ASSESSED FOR EXECUTIVES INGRADES E6 &E7

SN COMPETENCIES

1 Business Environment Knowledge: Knowledge and understanding of economic, legal, socio- political trends.

2 Profession Specific Knowledge: Knowledge related to profession as a whole. Knowledge whichis determined by authority & responsibility of other positions, knowledge of mission, values and

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standard operating procedures, policies.

3 Making Business Decisions: Use business related data to sport effective and timely businessdecisions by *Systematically gathering relevant business information *Identifying the strengthsand weaknesses of a particular business line *Recognizing opportunities or threats and acting onthem rapidly *Using business facts collected in daily decision making.

4 Vision: Develop a vision for the future of the organization by : *Grasping the meaning of trends &interrelationships between the organization and its environment at the local, national andinternational level *Identifying fundamental values and beliefs to guide the organization into thefuture.

5 Systematic Thinking: Identifying connections between situations that are not obviously related*using common sense, past experience and basic rules to identify key underlying issues*Generating and testing hunches which may explain complex situations or problems.

6 Networking: To cultivate an informal network which may help to get things done through

*Developing contacts with people outside of the immediate work Unit *Using networks as asource of information & support.

7 Organizing Resources: Ensure that all financial, personnel and/or other resources are in place tomeet needs by *Identifying and acquiring the resources. *Allocating and utilizing the resources ina timely and cost effective way *Monitoring and controlling all resources required to maintain theefficiency of operations.

8 Inspire People: To generate a sense of purpose for the work done by the organization instillingenthusiasm, loyalty and commitment among team members at all levels of the organization*Inspiring, motivating and guiding others towards organizational goals and objectives *Setting anexample for others by behaving in ways that are consistent with espoused beliefs and values andthe organizations vision and direction.

9 Team Player: To contribute to group objectives in a team environment through *Cooperating andinteracting well with others *Contributing actively and fully to team projects *Workingcollaboratively as opposed to competitively with others *Acknowledging diverse opinions,addressing relevant concerns and working towards consensual solutions that enhance the output of the team.

LIST OF VALUES TO BE ASSESSED FOR EXECUTIVES IN

GRADES E1 TO E7

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SN. VALUES

1 Fairness: Decisions are made objectively, free from patronage and reflect the just treatment of employees and applicants.

2 Transparency: There is open communication about every aspect of managerial decisions whichconcern people.

3 Trust: Trustworthiness leading to confidence *Allow staff the freedom to grow and develop*Relate to others on the basis of mutual respect * Courage to stand by ones convictions.

4 Candour: Frank and forthright *Give and receive constructive criticism/suggestions *openlydiscuss performance deficiencies and take corrective action *Appreciate good performance *Beconsistent in words and deeds *Face up to ones mistakes.

5 Collaboration: Working in tandem * Open in sharing information and in seeking suggestions /opinion * Sensitive to concerns of others * Honouring commitments *Encourage team work acrossdepartments / functions.

6 Involvement: Total commitment *Be dedicated and committed to work. *Build commitment byencouraging wide participation in decision making process to the maximum extent possible.

7 Flexibility: Ability to participate and adapt to changing circumstances using sound judgement*Open to accepting new ideas * Willing to learn from anyone and to do things differently*Prepared to operate and adapt to different environments.

8 Willingness to accept challenge: *Be willing to experiment*Allow for freedom to fail, but learnfrom it too.

9 Discipline: Adherence to accepted norms *Honour promises and adhere to agreed system*Respect for others time and space * Exercise self control.

10 Ethical Behaviour : Demonstrate honesty and sincerity in every action *Apply sound businessand professional ethics *Show consistency with principles, values and behaviors.

S.N GENERIC ATTRIBUTES

1 Leadership Abilities: Demonstrates ability *For guiding collective decision making *For succession planning *Crisis management and *Ability to take risks.

2 Team Building: Demonstrates effectiveness in re-organizing his/her own department *Managediverse and divergent views and group processes without losing sight of objectives.

3 Ability to build a strategic Vision: *Demonstrates ability to manage change *Focus on long termissues *strategic thinking *Translate vision into goals.

4 Business Sense: *Commitment to bottom line results by enhancing revenue generation byaddressing interest of customers and stakeholders *Balancing need for viable short and long term

performance *Optimizing unit/organizations contribution while supporting corporate objectives

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*Spotting and pursuing new business opportunities wherever possible.

5 Communication skills : Communicate ideas and information effectively and market key pointseffectively through public speaking and presentation * Ability to convert ideas through action

plans and ensure acceptability within the organization and performance at Board meetings

RESEARCH METHODOLOGY

The research design in my case was exploratory research design, which is also knownFormulative Research Design.

The main purpose of my study was getting the opinion of people regarding the performance appraisal system and what are the problems which are faced by theappraisees and the appraisers.

The research design in my study was flexible to provide opportunities for consideringdifferent aspects of the problem under study.

Types of Data collected:

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Primary: First hand information was received from the employees throughquestionnaires and personal interviews.

Secondary: The data from internet was collected to get a better insight and thecompanys manual.

SIMPLE RANDOM SAMPLING:

Simple random sampling refers to the sampling technique in which each and every itemof the population is given equal chance of being included in the sample.

Random sampling is sometimes referred to as REPRESENTATIVE SAMPLING. If thesample is chosen at random and if the sample is sufficiently large, it will represent allgroups in the population. A random sample is also known as PROBABILITY SAMPLE

because every item of the population has equal opportunity of being selected in thesample.

Sample size:

The sample size of my project is 100.

DATA ANALYSIS

1. Are you satisfied with the present performance appraisal system (E-map)?

(a) Yes [ ] (b) No [ ]

If No, then why ..

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60%

40%YES

NO

Interpretation: More than half of the employees are satisfied with the present performance appraisal system. The employees who are not satisfied are mainly from E-1to E-3 level.

2. Do you think the present system is effective / better than the previous appraisal

system?

(a) Yes [ ] (b) No [ ]

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70%

30%

YES

NO

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Interpretation: 70% of employees think that the current system (e-Map) is better than

the previous system (ACR) because earlier their result was totally confidential and was

not known to them.

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3. Do you think the e-map system reduces biasness?

(a) Yes [ ] (b) No [ ]

60%

40%YES

NO

Interpretation: 60% of the employees think that this system reduces biasness because

the KRA evaluation is transparent to each appraisee.

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4. As an appraisee do you face any problem while selecting the KRAs?

(a) Yes [ ] (b) No [ ]

20%

80%

YES

NO

Interpretation: 80% executives have no problem in selecting the KRAs because

everything is completely elaborated and they are given choices to choose among

many of their caliber.

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5. Does your appraiser help you in selecting the KRAs?

(a) Yes [ ] (b) No [ ]

85%

15%

YES

NO

Interpretation: 85% executives are helped by their appraisers in selecting KRAs.

This shows the good inter personal relationship between the appraisee and the

appraiser.

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6. Do you think the present list of KRAs cover all aspect of your job?

(a) Yes [ ] (b) No [ ]

75%

25%

YES

NO

Interpretation: O nly 25% executives feel that the present list of KRAs doesnt cover all

aspects of their job. The Executives which are under grade E1- E3 are unsatisfied.

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7. Do you think the part B of e-map system should be transparent to an appraisee?

(a) Yes [ ] (b) No [ ]

Interpretation: More than 65% appraisers feel that part-b should not be transparent to an

appraisee as this is the only part through which they can control the performance of their

subordinates.

32%

68%

YES

NO

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8. Do you get any formal feedback regarding your performance?

(a) Yes [ ] (b) No [ ]

70%

30%

YES

NO

Interpretation: 70% executive says that they get the formal feedback regarding their

performance by their superiors regularly while carrying out their work.

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9. Are any steps taken to improve the performance if not up to the mark?

(a) Yes [ ] (b) No [ ]

If yes, then what .

Interpretation: 30% executives say that the proper training is given to them for

upgrading their job whenever required.

70%

30%

NO

YES

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10. Do you find these steps effective / useful in your job?

(a) Yes [ ] (b) No [ ]

65%

35%

YES

NO

Interpretation: 65% executive feels that these steps are useful as they develop their skills and competencies.

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RESEARCH FINDINGS

Most of the appraisees find problem in selecting their KRAs.

Some appraisers dont help their appraisees in selecting the KRAs as they think its nottheir work.

Formal feedback is given by the appraisers on day- to- day basis.

Job related training is given to the executives and they think it really helps them in their further growth.

Most of the executives are satisfied with the current scenario of performance appraisal ascompared to older one.

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CONCLUSION

From the research it has been concluded that most of the executives who are not satisfiedwith the present performance appraisal system are the executives from E1 to E3 level asthey think it is quiet complicated. They find problems in selecting their KRAs from theKRA master as there are so many KRAs and they have to select the KRAs which arerelated to their work. Appraises also want that the score of Part- B of E- Map should beknown to them and the basis on which their score is given. But appraisers feel that thescore of Part B should not be known to appraises as the think it is the only way by whichsome how they can control the behavior of the executive. Appraisers dont have any

problem with this system as they are quite experienced.

Appraisers give proper feedback to their appraises on day today basis and proper trainingor challenging tasks are given to improve their performance. mainly the formal training isgiven at the time of joining the organization but if the employees face any problem later at the time of their job, their superiors help them in resolving their problems at the sametime.

But some appraises feel that they are not given proper feedback and even they dont wantany feedback as they think that they know their work very well.

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SUGGESTIONS

1. Proper training program should be conducted about the E-Map system for the new trainees.

2. Whenever there are any changes in the KRAs the executives should beinformed about it in advance.

3. Executives should be know that on what basis they performance is beingmeasured in Part-B as this plays an important role at the time of their

promotion.

4. Some personality development trainings should also be provided apartfrom mere job oriented training.

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LIMITATIONS

Little co-operations of some person due to conservative mind.

Some people have no time to give answer.

Sometimes people do not tell truth and fill it just for fun sake.

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QUESTIONNAIRE

Effect of Performance management system on organization.

(A) Employees Thinking (b) Management Thinking (c) Productivity (b) Cost

1. Are you satisfied with the present performance appraisal system (E-map)?

(a) Yes [ ] (b) No [ ]

If No than why ..

2. Do you think the present system is effective / better than the previous appraisal

system?

(a) Yes [ ] (b) No [ ]

3. Do you think the e-map system reduces biasness?

(a) Yes [ ] (b) No [ ]

4. As an appraisee do you face any problem while selecting the KRAs?

(a) Yes [ ] (b) No [ ]

5. Does your appraiser helps you in selecting the KRAs?

(a) Yes [ ] (b) No [ ]

6. Do you think the present list of KRAs cover all aspect of your job?

(a) Yes [ ] (b) No [ ]

7. Do you think the part B of e-map system should be transparent to an appraisee?

(a) Yes [ ] (b) No [ ]

8. Do you get any formal feedback regarding your performance?

(a) Yes [ ] (b) No [ ]

9. Are any steps taken to improve the performance if not upto the mark?

(a) Yes [ ] (b) No [ ]

10. Do you find these steps effective / useful in your job?

(a) Yes [ ] (b) No [ ]

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11. As an appraiser what problem do you face ?

12. Suggestion as an appraisee

13. Suggestion as an appraiser

Name :

Designation :

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BIBLIOGRAPHY

RESEARCH METHODOLOGY C.R. KOTHARI.

COMPANYS MANUALS

www.google.com www.bhel.hwr.co.in E-MAP Manual
http://www.google.com/http://www.bhel.hwr.co.in/http://www.google.com/http://www.bhel.hwr.co.in/

Documents

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