CASE STUDY ON PERFORMANCE APPRAISAL
BY:- HIMANI BHAN
ORGANIZATION- Indian Oil Corporation Ltd
Indian Oil Corporation (IndianOil) is India’s Largest Commercial Enterprise, with a net profit of ₹103.99 billion (US$1.5 billion) for the financial year 2015-16. Standing true to its corporate vision of being ‘The Energy of India’, IndianOil has been successfully meeting the energy demands of India for more than five decades. Being India’s flagship national oil company, IndianOil with a work-force of 33,000 efficient minds is living their vision of becoming ‘a globally admired company’. It is the leading Indian Corporate in Fortune’s prestigious ‘Global 500’ listing of world’s largest corporates at 161st position for the year 2016. IndianOil's business interests overlap the entire hydrocarbon value-chain—from refining, pipeline transportation and marketing of petroleum products to exploration & production of crude oil. And from marketing of natural gas to petrochemicals. Also, IndianOil has ventured into alternative energy and globalisation of downstream operations It has also formed about 20 joint ventures with reputed business partners from India and abroad to pursue diverse business interests. As of 31 March 2013, the company had 34,084 employees, out of which 2643 were women (7.8%). Its workforce includes 14,981 officers. The attrition rate in IndianOil is around 1.5%. The company incurred INR 78 billion on employee benefits during the FY 2012-13.
Organizational Culture is a system of shared assumptions, values, and beliefs which governs how people behave in an organization. It emphasis on people, outcome, aggressiveness, stability for the effectiveness of an organization. Performance Appraisal is a method of evaluating the behavior of employees in the work place, normally including both the quantitative and qualitative aspects of job performance. It is the process of deciding how employees do their jobs. Performance here refers to the degree of accomplishment of the tasks that make up an individual’s job. Performance Appraisal is a part of Organizational Culture leads to Organization Development.
INTRODUCTION
Recently I met Mr. XYZ who is a talented and well experienced human resource manager of one of the well-known public sector Navratna Company Indian Oil Corporation Ltd in Noida. He undertakes his role of HR manager by being an administrative expert and a change agent. The appraisal model which is followed on annual basis starting from the month of April till March has been extremely effective for the employees of IOCL.
Performance Appraisal is defined as the process of assessing the performance and progress of an employee or a group of employees on a given job and the potential for future development. It is systematic, periodic and an important rating of an employee’s excellence in matters pertaining to his/ her present job and the potential for a better job.
PERFORMANCE APPRAISAL: A CHALLENGE TO AN ORGANIZATION
Mr XYZ has always been an inspiration to his subordinates and his employees whose performance is measured and appraised by him. It is because of Mr XYZ’s 16 years of experience of working in HR departments helped him to get acquainted with various Performance Appraisal methods for evaluating the performance of his employees in a better way every time.
He had always been implementing only those methods which he found result-oriented in terms of enabling the employees to know about their performance in the organization, to help them in providing adequate training, if required, to increase their potential, to provide concrete feedback and evaluate their current job performance to determine transfer, retention and promotion of employees. He has been working in IOCL Noida Office for last 4 years and has gained good amount of respect and faith from his employees due to his appropriate and fair performance appraisal techniques that facilitated the uses of performance appraisal. The mostly used techniques in IOCL are checklist methods, field review and 360 degree feedback and assessment.
There is a drawback in the performance appraisal of employees because Mr XYZ has some good and close relations with his subordinates Mr P and Mr Q , he has developed a new tendency to appraise the performance of those employees known to Mr P and Mr Q with leniency and because he finds them similar to him. As a result of this unfair and inappropriate appraisal of Mr XYZ, he also evaluates the performance of the employees taking into account their recent performances only. This results in the downfall of the productivity of employees and is inefficient. This biased way of apprising employees has developed a negative feedback of employees towards the organization and has demotivated an employee towards his/her workmanship. When I visited this company I had an interaction with one of its employee who was totally demotivated by the company’s appraisal process. The above information of Mr XYZ and his close relations with Mr P and Mr Q was given by this employee of the company. So by going through the above information it is clearly understood that the appraisal method creates a huge impact on an organization with its employees performance and outcome.