B. Tech.

(SEM IV) EVEN SEMESTER THEORY EXAMINATION,

2009-2010

INDUSTRIAL PSYCHOLOGY

Time : 2 Hours Total Marks : 50

Note : Attempt all Questions

1. Attempt any four parts of the following : (14)Q. (a) Describe the role and scope of Industrial Psychology in engineering and technology.

Ans. Scope is the domain within which some action takes place. Another way of defining scope of industrial psychology would be to catalogue what psychologists do in industry. Industrial psychologists activities could be grouped into the following categories :

1. Personnel Psychology. It applies the methods and principles of psychology in analyzing the jobs, selecting and evaluating workers. In this area psychologists study about :

(i) Job Analysis. A job analysis involves the systematic collection of information about a job. Job-analytic methods are often described as belonging to one of two approaches. One approach, the task-oriented job analysis, involves an examination of the duties, tasks, and/or competencies required by a job. The second approach, a worker-oriented job analysis, involves an examination of the knowledge, skills, abilities, and other characteristics (KSAOs) required to successfully conduct the work.

(ii) Personnel selection or Selection of workers. Personnel selection is the systematic process of hiring and promoting personnel. Personnel selection systems employ evidence-based practices to determine the most qualified candidates. Personnel selection involves both new hires and individuals who can be promoted from within the organization. Common selection tools include ability tests (e.g., cognitive, physical, or psychomotor), knowledge tests, personality tests, structured interviews, the systematic collection of biographical data, and work samples. I-O psychologists must evaluate evidence regarding the extent to which selection tools predict job performance, evidence that bears on the validity of selection tools.

(iii) Training Employees. Psychologists in this area examine various methods that can be used to train and develop employees. People within this subfield work in a training department of an organization and are involved in following activities such as identifying the organization's training needs, developing and evaluating training success.

2. Organizational Psychology. It examines the effects of work environments and management styles on worker motivation, job satisfaction and productivity. Psychologists involved in organizational psychology are concerned with:

(i) Job Satisfaction. It is an attitude of workers toward his job. If the worker is satisfied then he has positive feelings toward his job and tends to be committed to an organization. Job satisfaction also depends on the relationship with workers, supervisors and colleagues.

(ii)Motivation. Motivation is a drive, which incites an organism to perform a work. Some persons are motivated to do a job and some are not motivated to do a job. Industrial Psychologists study, what are the factors which are responsible for motivation?

(iii) Relations between the worker and management. The owner and those persons who are appointed to supervise the worker’s performance come under the management. If the management is not well regulated in its work and overlooks the fulfilling of its obligations to the workers then workers discontinue to takes interest in their work. Industrial psychologists suggest measure for maintaining cordial relations among all the workers (feeling of love, sympathy, spirit of co-operation).

(iv) Leadership. Leadership emerges as a set of interactions. between a leader’s traits and skills, between a situation’s demands and characteristics and between follower’s needs and characteristics. Leader performance affects organizational performance. When employees trust their leaders, the employees perform better, are more satisfied with their jobs, are more committed to the organizations. Leadership is of utmost importance in industry because whether it is leadership at the highest level (boss) or middle level (manager, executive) or at bottom level (foreman, supervisor), it always has tremendous impact on the working of an organization. But leadership is often a liability and can affect production adversely, increase cost of production, may lead to increased absenteeism, accidents, strikes. In fact, it can be called a key factor in the working of an organization. Industrial psychologist are well-versed in the various styles and aspects of leadership.

(v)Organizational Communication. To be an effective employee it is essential to communicate effectively with others. If the person can’t communicate the concepts to others, then his knowledge or opinion is useless, or there is no use of knowledge without the communication process.

3. Human Factors. Psychologists in the area of human factors concentrate on:

(i) Work-design. The design of work should be in such a way that it considers the human factors, which increases work efficiency and improved the quality of work life.

(ii) Working Conditions. Working conditions should be in ideal manner, which covers two general categories. The first is on the physical environment with reference to illumination, noise and atmospheric conditions. The second is on various aspects of time, such as work hours, work schedules and rest pauses. Unfavorable working conditions contribute to a showdown of the employee’s activities and production. It creates high absenteeism and contributes to inefficiency. Favorable working condition such as adequate illumination, atmospheric conditions and control of noise in industry result in increased production. Work schedules have various aspects, including the total number of hours worked per week, the distribution of hours throughout the work week, shift work, and provision for rest periods. Hours of work are suitable, i.e., about forty hours per week and regular rest periods result in high production.

(iii) Ergonomics. It is also known as human engineering and human factors in engineering. Human engineering is the study of people at work and of work methods; it includes a study of equipment design, placing of work, hours of work and environmental conditions of work; its purpose is to improve productivity and job satisfaction. It is related to equipment and product design.

4. Consumer Psychology. The term consumer psychology refers to the study of how people relate to the goods and services they use in their daily lives. Also known as the study of consumer behavior, consumer psychology provides opportunities to examine issues such as what factors are most important when people decide to purchase a particular item, how customers determine the value of a service, and whether or not television and magazine advertisements can convince a reluctant consumer to try a new product for the first time. Consumer psychology seeks to describe and explain consumer behavior, although some consumer psychologists will attempt to predict or influence a customer’s decisions.

5. Managerial Psychology. Managerial psychology is about applying understanding of people to creating best practices in the management and

development of people. Managerial Psychology is mainly concerned to problems of management of industry. It is designed to be relevant to a variety of people from upper management to middle and lower management. It involves the activities of administrative skills.

Q.(b)What are the major influence on Industrial Psychology? Elaborate.

Ans. Scientific Management Approach: Time and motion study is the base of Industrial Psychology.Taylor, An American Engineer and father of scientific management, observed that lot of fatigue was produced because workers were not working properly. Taylor scientifically rearranged the work and found four times rise in production. It became a kind of scientific movement and was known as ‘Taylorism’ or ‘Scientific Management'.

Taylor has emphasized the following basic ideas or principles of scientific management.

(i) Scientific Working Method.(ii)Selection Criteria of Workers. (iii) Relationship between the Manager and Worker.(iv) Unbiased Distribution of Work.(v)Mental Revolution.

Human Relation Approach: As humanities developed the idea came into existence that human factors are important in industrial psychology. Thus, some personal factors are also important in industrial production and these days the relations between the employer (or the industrialists) and workers (or laborers) appear to be cordial.

The Human Relations Approach aims at producing maximum employee satisfaction in order to increase efficiency and productivity. Elton Mayo regarded as father of human relation approach. The following factors are responsible for attention on human relations in industry:

-Taylor ignored the human elements in organization and concentrated on technical aspect.

-In classical theory, manager considered workers as a factor of production.-Classical theory ignored the demands and aspirations of the workers.-Informal relations at workplace were not liked by the managers.

Above mentioned factors motivate Mayo to proposed human relations approach. The approach is based on a series of studies by industrial psychologists beginning with the Hawthorne experiment in the U.S.A. in early 1930s.

According to this approach the people working in an organization are valuable resources whose talents have to be developed and utilized for the achievement of organizational objectives and effectiveness. It recognizes that without proper utilization of human resources, no organization can prosper regardless of how much material resources the organization happens to possess.Q.(c) Discuss the principles of scientific management.

Ans. Taylor has emphasized the following basic ideas or principles of scientific management.

(i) Scientific Working Method. With the development of various types of new machines to be used in industry, a working method adopted by workers should be scientific (according to new styles of tools) and systematic. The old methods should be replaced by new methods. Develop the systematic method for performing job.

(ii)Selection Criteria of Workers. It should be based on aptitude of workers. In this aptitudes of candidates should be ascertained and persons having the required aptitude should be selected for a particular job. Manager should select right person for the right job or select workers with appropriate abilities for job.

(iii) Relationship between the Manager and Worker. Taylor believed in cooperation between management and workers. Both workers and managers should have feeling of love, sympathy and concern for each other. For example, while assigning work to workers if management asks them about their interest and then work is assigned according to their interest, definitely the workers will perform it more efficiently.

(iv) Unbiased Distribution of Work. There should be no partiality in the distribution of work. Division of work between managers and workers should be equal, so that the managers apply scientific management principles to planning the work and workers actually perform the tasks. Each worker is supposed to do work in his own domain. If a worker having more efficiency than others may be more responsibility.

(v) Mental Revolution. To alter or change the mental attitudes of the workers and the management is known as mental revolution. There are three aspects of mental revolution: (a) All efforts for increases in production.(b) Spirit of mutual trust and confidence.

(c) Developing the scientific attitude towards problems.There should be proper division of work between the managers and the

workers. Manager should perform the planning function; there should be no partiality in the distribution of work. The workers should also change their attitude towards the management. Taylor creates a mental revolution on the part of management and workers. Taylor laid emphasis on these principles and the success of these principles depends on mental revolution of management and worker.Q.(d) What is the relevance of Relay room experiment in Hawthorne Experiments?

Ans. The second phase of Hawthorne Experiment was made in a study of relay assemblers at the Hawthorne plant. Purpose. To study the effect of fatigue on productivity.

Method. The Relay assembly room experiments were conducted by a team of Harvard Business School. These are considered to be the actual beginning of the Hawthorne Studies since the Illumination Studies failed to come out with any conclusion. A group of women were selected for study who had been assembling relays so long that their production was no longer improving with practice. Various changes like change in the number of hours in a work week, number of hours in a work day, number of breaks, free social interaction among group members or freedom to form informal groups, friendly and informal supervision.

Findings. The findings took the researchers by surprise, since irrespective of the changes made, there was an overall increase in productivity. This became known as the “Hawthorne Effect”. They realized that since the subjects’ were given a great deal of freedom, they had formed an informal group. The researchers thus discovered the concept of informal organization. They found that workplaces were social environments and that there were factors other than just economic self-interest. An important conclusion drawn was that every aspect of an industrial work environment had a social value.

The relevance of this experiment is that in this phase Hawthorne effect has been introduced.

II. Attempt any two parts of the following : (12)

Q. (a) Discuss various theories of motivation in brief.

Ans. Theories of motivation are helpful to understand the nature of motivation.

Maslow’s Hierarchy of Needs

Hierarchy of need theory was propounded by Abraham Maslow. Maslow identified five levels of need.

Self-Actualization

Self-Esteem

Belongingnces Needs

Safety Needs

Physiological Needs.

1. Physiological needs. The physiological needs, is the basic level in the hierarchy. It is also known as basic need. The need of hunger, thirst, sleep, and sex are some examples, According to the theory, once these basic needs are satisfied, they no longer motivate. For example, a starving person will strive to obtain a food that is within reach. However, after eating food, the person will not strive to obtain another one and will be motivated only by the next higher level of needs.

2. Safety needs. The second level of needs is safety need, which is equivalent to security need. Maslow stressed emotional as well as physical safety. The whole organism may become a safety-seeking mechanism.

3. Belongingness need. This level of need corresponds to the affection and affiliation needs. A more appropriate word describing this level would be “social”, which is important for motivators. These include need for love, for acceptance and for giving and receiving friendship.

4. Esteem need. The esteem level represents the higher needs of humans. The need for power, achievement, and status can be considered part of this level. Maslow carefully pointed out that the esteem level contains both self-esteem and esteem from others. It is a need for knowledge or cognitive need.

5. Self-actualization. This level represents the culmination of all the lower, intermediate, and higher needs of humans. People who have become self actualized are self-fulfilled and have realized all their potential. It is the need for realizing

one’s own potentialities and for continual self development. In effect, self-actualization is the person’s motivation to transform perception of self into reality.

II. HERZBERG’S TWO-FACTOR THEORY

Herzberg proposed two-factor, also known as dual factor theory or motivation—hygiene theory. First factor is motivator and second one is hygiene factor.

Motivators are job elements that do concern actual tasks and duties, e.g., responsibilities, work itself. Hygiene factors are those job related elements that result from job but do not involve the job itself. For example, pay and benefits are consequences of work, but do not involve the work itself. Examples of hygiene factors and motivators are given in the following table:

Hygiene factors Motivators

Pay Responsibility

Security Growth

Coworkers Challenge

Working condition Stimulation

Company Policy Independence

Work Schedule Achievement

Supervisors Work itself

The presence of both hygiene factors and motivators can bring job satisfaction and motivation.

III. ERG Theory

Alderfer offered ERG theory or identified three groups of core needs : existence, relatedness and growth. He termed his theory as existence, Relatedness, Growth theory.

Existence Needs. These needs are concerned with the physical existence of the organism. They include basics such as food, clothing and shelter and means provided by work organizations to attain these factors, For example, pay, safe working conditions and job security.

Relatedness Needs. These needs are those interpersonal needs that are satisfied through interactions with others both on and off the job.

Growth Needs. These are needs for personal development and improvement. They are not by developing whatever abilities and capabilities are important to the individual.

IV. Mc.Gregor’s X and Y theory

Mc.Gregor’s gave two factors-X and Y. Theory X is anxiety producing and theory Y is anxiety reducing. X has negative aspect and Y has positive aspect.

Theory X. Assumptions of theory X

(1) Average human being has an innate dislike for work and will avoid work.

(2) Because of the above mentioned characteristic most people direct their behavior towards their work due to punishment. This theory has negative approach of motivation and anxiety producing approach. The knowledge of punishment also works as a motivation.

Theory Y. Assumption of Theory Y.

(1) Average human being has an innate like to work.

(2) Here punishment has no works and no external stimulus is needed and is self-directed, self controlled behavior.

(3) Reward is given on achievement basis. Capacity to exercise leads to high production in industry.

(4) Under conditions of modern industrial life the intellectual potentiality of the average human being are only partially utilized.

V. Expectancy Theory

Vroom gave expectancy theory. According to this theory an individual should be rewarded with what he or she perceives as important rather than what the manager perceives.

Example—One individual may value a salary increase, whereas another may value promotion. This theory contributes an insight into the study of employee motivation by explaining how individual goals influence individual performance. Expectancy theory suggests that work motivation is strongly affected by three factors : Expectancy, instrumentality, and valence. It can be expressed as :

Motivation = Expectancy × Instrumentality × Valence

M = E × I × V

It can be expressed as:

The person will make their choice of action or inaction according to whether all three conditions are met or not. The high levels of expectancy, instrumentality, and valence leads to the high motivation. However, even if only one of these is zero then motivation will not ensue.

Expectancy. It is belief that extra effort will lead to improved performance. Performance of the worker is formed according to expectancy, if positive expectancy is there then his effort are more.

Instrumentality. It is belief that good performance will be noticed and rewarded. It refers to the outcome of the individual for the job performance. If performance is high then employees will receive bonus and if performance is low then employees will not receive bonus.

Valence. Value placed on rewards that are offered. It means the attraction and the outcome of the individual. If the worker received bonus then his attraction will be positive and if not then there will be negative attraction. The range of degree of attraction is from –1 to +1.

VI. Equity Theory

Adams introduced equity theory. According to this theory, a person is said to consciously compare his or her outcome/input ratio with that of other persons or other classes of persons whom he or she perceives as relevant to such comparative purposes. Equity is said to exist when an individual perceives his or her own outcome/input ratio to be equal to that of other persons; inequity exists if the person's ratio is not the same as that of other persons, all of these comparisons are subjective, not objective. The process of deciding equity involves social comparison by organizational members. Schematically, equity is represented as follow:

Equation of equityPerson’s input (effort)

Person’s outcomes (Salary)=

Other person’s input (effort)Other person’s outcomes (Salary)

Equation of inequityPerson’s input (effort)

Person’s outcomes (Salary)>

Other person’s input (effort)Other person’s outcomes (Salary)

Person’s input (effort)Person’s outcomes (Salary)

<Other person’s input (effort)

Other person’s outcomes (Salary)

III. Performance-Satisfaction Theory

Porter and Lawler extended and studied the relationship between performance and satisfaction. Porter and Lawler extended the model of Vroom. They studied the relationship between performance and satisfaction,

Valence of reward Abilities Intrinsic Reward

Satisfaction

Reward Probability

Role Perception

Extrinsic Reward

Effort Performance

(1)

(2)(3) (6)

(4)

(5)

(7)

(9)

(8)

Fig. : The Porter & Lawler motivation model.

Effort leads to performance and performance may lead to two kinds of reward, i.e. intrinsic reward, such as self satisfaction and extrinsic reward such as pay, bonus and status. Both type of reward is necessary for satisfaction. This leads to further effort for performance, i.e. satisfaction will affect the effort. The satisfaction leads to more efforts for performance.

Q. (c) Differentiate between ‘Formal’ and ‘Informal’ groups.

Ans. Differences between Informal and Formal Organization

Basis of Informal Formal

Comparison Organization Organization

General nature Unofficial Official

Major concepts Power and politics Authority and responsibility

Primary focus Person Position

Source of leaders powerGiven by group Delegatedby management

Guidelines for behavior Norms Rules and policies

Sources of control Sanctions Rewards and penalties

III. Attempt any two parts of the following : (12)Q. (a) “Selection is the process of rejection”. Justify this statement.

Ans. Selection is the process of picking individuals (out of the pool of job applicants) with requisite qualifications and competence to fill jobs in the organization.

According to Stone “Selection is the process of different- iating between applicants in order to identify (and hire ) those with a greater likelihood of success in job.”

Selection means choosing the right person to be hired from a group of applicants. In other words selection means collecting, measuring, and evaluating information about candidates qualification for specified positions. Companies use these practices to increase the likelihood of hiring individuals who have the right skills and abilities to be successful in the job.

Selection Procedure. The selection procedure or process involves various steps which are depicted in following figure:

Reception of Applicants

Behaviour based interview

Employment Tests

Employment

Investigation of Previous History

Waiting List of Desirable Applicants

Preliminary Selection in Employment Department

FinalApproval By Department Head or Supervisor

Physical Examination

Placement

Negative decision

Physically unfit

Rejection

Fig. : Selection process.

(i) Reception of applicants. The first step in most selection processes involves the collection of basic candidate information. Almost all organizations require job candidates to submit a resume and complete a standard application to summarize education and work history.

(ii) Behaviour based interview . The organizations used behavior-based interview to some extent as part of their selection process. In structured behavior-based interviews, candidate are asked to describe specific behavioral examples of their skills. A variety of research studies have been conducted comparing the validity of different interviewing techniques. Behavior-or experience-based interviews were found to predict subsequent job performance better than other interviewing techniques (e.g., situational interviews) Pulakos & Schmitt, 1995). More organizations are opting to perform such structured interviews as part of the selection process to increase the likelihood of hiring candidates who will be successful in the positions.

(iii) Employment tests. Types of tests were used by more than 50 percent of the respondents :

— Performance/Work sample tests (for example, writing a computer program under structured testing conditions) are used by 58 percent of organization.

— Knowledge tests (tests that measure job-specific knowledge) are used by 56 percent of organization.

— Ability tests (mental, clerical, mechanical, physical, or technical) are used by 52 percent of organizations.

(iv) Employment interview. Interview is a formal in depth conversation conducted to evaluate the applicant’s acceptability. It is considered to be an excellent selection device. Its popularity stems from its flexibility. Interview can be adapted to unskilled, skilled, managerial and professional employees. It allows a two-way exchange of information, the interviewers learn about the applicant, and the applicant learns about the employer.

(v) Investigation of previous history. Many Employers request names, addresses, and telephone numbers or references for the purposes of verifying information and, perhaps, gaining additional background information on an applicant.

Previous employers, known public figures, university professors, neighbours or friends can act as references. Previous employers are preferable because they are already aware of the applicant’s performance, but, the problem with this reference is the tendency on the part of the previous employers to over-rate the applicant’s performance just to get rid of the person.

(vi) Final approval. In most of the organizations, selection process is carried out by human resource department. The candidates short listed by the department are finally approved by the executives of the concerned departments.

(vii) Physical examination. The selected candidate is required to undergo a physical fitness test. The physician is given a copy of the job description and asked to determine if there are any medical conditions that will keep the employee from safely performing the job. It assists in determining whether an applicant is physically fit to perform the work.

(viii) Placement. After an employee has been hired and oriented, he or she must placed in his/her right job. Placement is understood as the allocation of people to job. It is the assignment or reassignment of an employee to a new or

different job. Placement includes initial assignment of new employees and the promotion, transfer, or demotion of present employees.

(ix) Rejections. Once a decision has been made regarding which applicants will be hired, those who will not be hired must be notified. Rejected applicants should be treated well because they potential customer and potential applicants for other positions that might become available in the organization (Koprowski, 2004; Waung and Brice, 2003).

Q.(b) What are the legal framework of accidents and safety under factories Act 1948 ?

Ans. The legal framework of safety and accident prevention for the factory workers is provided under Act, 1948. The safety provisions are contained in section 21 to section 41 of the Factories Act, 1948. The safety provisions as given under the Factories Act are described as under:Section 21 : Fencing of Machinery. In every factory, every dangerous part of any machinery must be securely fenced by safeguards of substantial construction.Section 22: Work on or near Machinery in motion. With a view to secure the safety of the workers, it is necessary to examine any part of the machinery, while it is in motion. The worker should wear tight –fitting clothes.Section 23: Employment of Young person on dangerous machine. No young person shall work at any machine unless he has been fully instructed as to be dangers arising in connection with machine.Section 24. Striking Gear and Devices for Cutting off Power. In every factory, suitable devices for cutting off power in emergencies from running machinery shall be provided and maintained in every work room.Section 25. Self acting machine. No traversing part of a self-acting machine in any factory.Section 26. Casing of new machinery. All machinery driven by power and installed in factory should be completely encased.Section 27. Prohibition of Employment of Women and Children near cotton openers. No women or child shall be employed in any part of a factory where pressing cotton opener is at work.Section 28. Hoists and Lifts. In every factory every hoist and lift shall be properly maintained.

Section 29. Lifting machines, chains and Ropes. In every factory every lifting machines should be properly checked and maintained.Section 30. Revolving Machine . In every room in a factory in which the process of grinding is carried on, there shall be permanently affixed to or placed near each machine in use a notice indicating the maximum safe working peripheral speed of every grindstone.Section 31. Pressure Plant. If in any factory, any part of the plant or machinery used in a manufacturing process is operated at a pressure above atmospheric pressure, effective measures shall be taken to ensure that safe working pressure of such part is not exceed.Section 32. Floors, Stairs and Means of Access. In every factory all floors, steps, stairs and gangways shall be sound constructed and properly maintained.Section 33. Pits, Sumps, Opening in floors. In every factory fixed vessel, sumo, tank, pit in the ground shall be either securely covered or securely fenced.Section 34. Excessive Weights. No person shall be employed in any factory to lift, carry or move any load so heavy as to be likely to cause him injury.Section 35. Protection of Eyes. The state government may be rules to protect eyes from exposure of excessive light by providing employees the effective screens or suitable goggles.Section 36. Precautions against Dangerous Fumes. In any factory no person shall enter or be permitted to enter any chamber, tank, pit, pipe or other confined space in which dangerous fumes are likely to be present. Section 36A. Precautions regarding the use of Portable light. In any factory no portable electric light or any other electric voltage exceeding twenty four volts shall be permitted for use inside any chamber, tank, pit or other confined space.Section 37. Explosive or Inflammable Dust, Gas etc.Section 38. Precautions in case of Fire. In every factory there shall be provided such means of escape in case of fire.Section 39. Power to require Specification to defective part.Section 40. Safety of buildings and Machinery. Safety officers shall be deputed for safety purpose.Section 41. Power to make rules. The state Government may make rules requiring the provision in any factory.

Q.(c) What is the role of job analysis in screening process of manpower acquisition?Ans. Job analysis is a process for determination of what workers do on a job or the study of particular aspects of a given job. The aspects may range from the tasks and duties of the position, to an examination of the desirable qualities of an employee, to the conditions of employment including pay, promotion opportunities, vacations, etc.

Determination of human resource or manpower requirements is one of the major problem in human resource or manpower planning. Manpower planning is concerned with the determination of requirements of manpower acquisition for the organization both in terms of quantity and quality. The quantitative aspect deals with determining the total amount of work to be done in a particular period of time and the total number of people required to do the work. But the type of people to be employed for doing the work comes under qualitative aspect of manpower requirements. The process by which qualitative requirements are determined is known as job analysis.

Job analysis is useful in process of manpower acquisition. For the employment of suitable manpower, it is necessary to have clear statements of jobs to be performed and of the skills and knowledge that must be possessed by the employees who will fill these jobs. The information regarding these two is procured from job descriptions and job specifications respectively. These help in matching as closely as possible the job requirements with the applicant’s aptitudes, abilities and interest to facilitate the acquisition of suitable employees. If the applicant’s knowledge, skills and aptitudes do not match with the job specifications, he will be screened out to avoid the consequences of wrong person for any job. A clear understanding of job requirements helps in matching these with the abilities, interests and aptitudes of people. Each job can be assigned to the person who is best suited for it.

IV. Attempt any two parts of the following : (12)

Q (a) What do you mean by Performance Appraisal ? What is its importance?

Ans. Performance appraisal is the systematic, periodic and an impartial rating of an employee’s excellence in matters pertaining to his present job and to his potentialities for a better job. When properly conducted, performance appraisal should not only let the employee know how well he is performing, but also influence the employee’s future level of effort, activities, results and direction. Performance appraisal involves establishment of a plan of improvement of employee’s performance.

Performance management is an ongoing dialogue between manager and employee that links expectations, ongoing feedback and coaching, performance evaluations, development planning, and follow-up. It is clear by the figure :

Self Expectations

Gather Data

Performance Evaluations

Feedback

Development Planning

Fig. : Process of performance appraisal.

Set Expectations. As a best practice, we encourage supervisors to define expectations for every position. These expectations and performance measurement standards should be communicated to new employees, and reviewed at least once a year with all employees. Expectations for each position can include: purpose of the position, key responsibilities - both tasks and duties, conduct expectations, and performance standards, as well as, measures such as quality, quantity, timeliness, initiative, and teamwork for each key responsibility.

Gather Data. Performance management should not be a one time event. Supervisors are encouraged to gather data regarding employee performance in a systematic manner throughout the year. The Performance Record and the Coaching Log are guides that can be used by supervisors, in addition to their own best practices, to gather data throughout the year and provide ongoing feedback to

employees regarding performance. This information will then be available to supervisors when drafting the Annual Performance Evaluation.

Performance Evaluations. As a supervisor, your role is to set expectations, gather data, and provide on going feedback to your employees to assist them in utilizing their skills, expertise and ideas to produce results. To provide this direction, you should communicate to employees what is expected of them, define satisfactory performance for those expectations, and then monitor and evaluate the performance on an on going basis.

The Annual Performance Evaluation should provide a comparison of actual on-the-job performance to established performance measurement standards. The Annual Performance Evaluation encourages periodic and structured communication between supervisors and employees about the job, and should take place continuously. While day-to-day evaluation is usually informal, Annual performance evaluations are the final phase of an effective performance management system. As a best practice, we recommend that the process start with performance planning between the supervisor and the employee in which they discuss expectations, performance standards, and objectives for the next year.

Feedback. Feedback is a process by which effective performance is reinforced and less-than-desirable performance is corrected. Feedback should be information that highlights the relationship between what is expected and what has been accomplished after the work is performed or the action is taken.

Feedback can take many forms; it can be informal or formal. It can be given as praise in the form of reward and recognition, or it can be corrective in the form of disciplinary or corrective action.

Development Planning. Development planning is the process of creating experiences for your employees that promote skills and knowledge related to the position, as well as to professional growth. Development plans draw from the Performance Evaluation :

— Performance goals or needs (deficiencies) to be addressed.

—The employee, with supervisor assistance, identifies ways to achieve those goals and/or address performance deficiencies in systematic ways.

— Commitment between employee and supervisor.

— Planned follow-up.

IMPORTANCE OF PERFORMANCE APPRAISAL

Performance appraisal offers competitive advantage to a firm by improving performance, helping make correct decisions, answering legal compliance, minimizing job dissatisfaction and ensuring consistency between organizational strategy and behavior.

Improving Performance

An effective appraisal system can contribute to competitive advantage by improving employ job performance in two ways by directing employee behavior towards organizational goals and by monitoring that behavior to ensure that the goals are met.

Making Correct Decisions

Appraisal is a critical input in making decisions on such issues as pay raise, promotion, transfer, training and completion of probationary period. Right decision on each of these can contribute to competitive strength of an organization.

Ensuring Legal Compliance

Organization can minimize costly performance related litigation by using appraisal systems that give fair and accurate ratings.

Minimizing job Dissatisfaction

Employees tend to become emotional and frustrated if they perceive that the ratings they get are unfair and inaccurate. Such employees find that the efforts they

had put in became futile and get de-motivated. Fair and accurate appraisal results in high motivation and increased job satisfaction. An organization having satisfied and motivated employees will have an edge over its competitors.

Consistency between Organizational Strategy and Behavior

An organization needs a strategy consistent with the behavior of its employees if it were to realise its goals. Employee engaged themselves in behaviors that they perceive will be rewarded. For example, if the focus is on rewarding productivity, employees will strive for productivity. Thus, the performance appraisal system is an important organizational mechanism to elicit feedback on the consistency of the strategy behavior link.

Q.(b) Differentiate between ‘On the job’ and ‘Off the job’ Training.

Ans. The term training indicates a systematic procedure for transferring technical know-how to the employees so as to increase their knowledge and skills for doing particular jobs. Training may be classified as : On-the-job training and Off-the-job training. On-the-job training involves training whilst the job is being performed e.g. training of bar staff. Off-the-job training sees learning taking place at a college, training centre or conference facility. The difference between on-the-job and off-the-job methods are as follows:

On Job training - in work learning as it happens in real time, whereas, Off the job training is normally in a classroom/workshop covering theory and practical but can include, depending on the learning taking place actual experience of a situation

On-the-job training involves employees acquiring or developing skills without leaving their usual workplace, perhaps by being guided through an activity by a more experienced member of staff, whereas, Off-the-job training involves employees leaving their normal place of work in order to receive instruction, either within the firm or by using an external organisation such as a college or university.

On-the-job training method regarded as low cost and less time consuming method, while off-the-job method regarded as high cost and more time consuming method.

On-the-job training is a part of job activity and off-the-job training is not a part of job activity.

On-the-job training is informal training and is not systematically organized, whereas off-the-job training is formal training and organized systematically.

On-the-job training is practical in nature and considered to be the most effective method of training the operative personnel, whereas, off-the-job training is theoretical in nature.

The learner may be active in On-the-job training, but, the learner is passive in another type of training.

On-the-job training is associated more with skills, whereas, off-the-job training is associated more with knowledge rather than skills.

Q. (C) How performance appraisal and training is related ? Explain.

Ans. Performance Evaluation is a tool which can use to help enhance the efficiency of the work unit. This tool is a means to help ensure that employees are being utilized effectively. Employees can use it as a clear indication of what is expected of them before employer tell them how well they are doing, and then as feedback of how well they did. Performance appraisal offers an excellent opportunity - perhaps the best that will ever occur - for a supervisor and subordinate to recognize and agree upon individual training and development needs.

During the discussion of an employee's work performance, the presence or absence of work skills can become very obvious - even to those who habitually reject the idea of training for them!

Performance appraisal can make the need for training more pressing and relevant by linking it clearly to performance outcomes and future career aspirations.

From the point of view of the organization as a whole, consolidated appraisal data can form a picture of the overall demand for training. This data may be analyzed by variables such as sex, department, etc. In this respect, performance appraisal can provide a regular and efficient training needs audit for the entire organization.

The aim of a performance appraisal is to identify employee training needs. It can be identified by using bell curve system of appraisal. Bell curve system of appraisal is a forced ranking system imposed on the employees by the

management. Forced ranking has been defined as a workforce management tool based on the premise that in order to develop and thrive, a company must identify its best and worst performers, then nurture the former and rehabilitate and / or discard the latter. Bell curve system rates the entire workforce by comparing the performance of those engaged in similar activity and ranking them on the basis of their performance. The entire workforce is segregated as the top performers, medium performers and the poor performers. The percentile varies with the company policy; it could be the top 10%, middle 80% and the bottom 10%.

The employees belonging to the higher grade contribute significantly to the enterprise. They are showered with rewards like restricted stock options, bonuses, etc so as to motivate them to continue their excellent services to the business entity. The middle percentile employees are significant in number and their presence ensures uninterrupted work flow within the organization. They generally have some weakness which is negated by the training facilities offered by the company. Similarly training is also provided to enrich their key skills to utilize in a way profitable to the entity. The bottom ranking consists of those whose performance needs significant improvement and whose is unsatisfactory. The ranking acts as a warning system that tells the employee where he stands in relation to his peers. The employees belonging to the lower strata are at times given the opportunity to improve their efforts or are renounced from the system.