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MODULE-4

ORGANISATIONAL CULTURE
INTRODUCTION
Culture deals with past and current assumptions, experiences, values, attitudes,
beliefs, expectations, customs etc. Culture relates to the informal aspects of organisations rather
than their official elements. They focus on the values, beliefs and norms of individuals in the
organization Culture is manifested by symbols and rituals rather than through the formal
structure of the organization.

The values and behaviour that contribute to the unique social and psychological environment of
an organization is called organizational culture. It refers to the system of shared meaning held
by the members that distinguishes one organization from other organization.
Features of Organisational Culture:
Shared meaning
Values and Norms
Behavioural Consistency
Descriptive
Organisational Philosophy
Clear Guidelines
Sense of Belongingness

Factors determining org. culture

Org. Founder:
Whatever impression founders create about the organization, it continues and develops for a long
period of time.
Corporate success & shared Experiences:
Corporate success for a long period develops a strong culture. If the members share common
experience, it remains in their mind forever.
Innovation & risk taking:
Innovative and risk taking employees develop a strong culture.
Outcome rather than technique: Organisations whose managers focus on outcome rather
than technique, they develop strong culture.

Competitiveness:
Organisations whose employees are competitive are actually stronger than non-competitive.
Shared interpretation:
Organisations whose members have common perception and thinking about organizational
values, norms, they can develop a strong culture.
Functions of Organisational Culture
 It distinguishes one organization from another organization. That means it creates
brand name for the organization.
 It develops a sense of identity amongst its members.
 It promotes commitment amongst employees to achieve oganisational goal.
 It develops appropriate standard for employees & holds them together to achieve
those standard.

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 It provides a control mechanism for shaping the attitude & behaviour of

employees.
Transmission of organizational Culture/How is culture learnt:

 Stories:
The stories be these true or false, told to the organizational members can have a
profound impact on organizational culture.
 Symbols:
Examples of symbols include the size of offices, the elegance of office furnishing etc for
certain employees. The value of these symbols is that they communicate important
cultural values.
 Language:
Organisations use a language in terms of specific slogan, metaphor to convey special
meaning to employees. It symbolizes what the company stands for to both employees
and society.
 Rituals:
Rituals such as annual function, award ceremonies etc reinforce the key values of the
organization, which goal is imp, which people is important. The annual function
organized by the VSSUT is an example of ritual performed in an educational institution.

ORGANISATIONAL CHANGE

Change is necessary for survival and growth. Changes are constantly taking place in
our environment. Changes occur outside organization that requires internal adaptation. The
manager has to ensure that individual and groups in organizations, and structures, process and
behaviors of sub-systems must adapt to the changing external and internal environments. In
effect, the manager is a change agent who facilities changes to occur in the various subsystems
of the organization needed.
Any alteration which occurs in the overall work environment of an organization is called
organizational change.

FACTORS AFFECTING CHANGE:

There are both external and internal forces that result in pressure for change,
External Factors:
The external forces that create the need for change come from various sources. Some of them are
as follows:
Competitive Market Force:
Competition is changing. The global economy means that competitors are as likely to come from
across the ocean as from across town. Heightened competition also means the established
organizations need to defend themselves against both traditional competitors that develop new
products and services and small, entrepreneurial firms with innovative offers. Successful
organizations will be the ones that can change in response to the competitor.
Government laws and regulations:
These are frequent impetus for change. Creation of special economic zones and foreign direct
investment in India sparked off major changes in the IT Industries, Insurance, and Car

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manufacturing industries. More foreign automobile industries are setting up manufacturing

plants and generating more employment opportunities in India.
Technology:
It creates the need for change. For example, technological developments in sophisticated and
extremely expensive diagnostic equipment have created significant economy of scale for
hospitals and medical centers. Assembly-line technology is undergoing dramatic change as
organizations replace human labor with robots. Even in the greetings card industry, electronic
mail and internet have influenced the way people send greetings.
Labor Markets:
The fluctuation in labor markets forces managers to change. For instance, the demand for
webpage designers and website managers made it necessary for organizations that need those
kinds of employees to change their human resources management activities to attract and retain
skilled employees in the areas of greatest need.
Economic Changes:
Economic changes affect almost all organization. The appreciation of rupee value against the US
dollar affects the export prospects of knitwear products from India to America as those products
cost more to Americans. But even in strong economy, uncertainties about interest rates,
government budgets deficits and current exchange rates create conditions that may force
organizations to change.
Internal Factors:
Internal forces can also stimulate the need for change. These internal forces tend to originate
primarily from the internal operations of the organizations or from the impact of external
changes.
Structural factors:
A structural force would be the inability to transmit important information from the top of
the organization to the lower level cadre. Because of numerous layers in the hierarchy,
information moves slowly from one level to the next. This could be viewed as a process or a
behavioral problem involving a failure to communicate effectively.
Strategy:
A redefinition or modification of an organization’s strategy often introduces a host of change.
The strategic move of Reliance Industries in getting into retail business in urban and rural
markets made them to introduce a change in the managerial approach as well as the human
relations approach to gain acceptance from the different cross section of the customers.
Organizations Workforce:
In recent times, the work force composition is varied and is not very static. Its composition
changes in terms of age, education, sex and so forth. In a stable organization with a large pool of
seasoned executives, there might be a need to restructure jobs in order to retain younger
managers who occupy lower ranks. The compensation and benefit system might also need to be
adapted to reflect the needs of an older work force.
Technology:
The introduction of new equipment represents another internal force for change. Employees may
have their jobs redesigned, they need to undergo training on how to operate the new equipment
or they may be required to establish new interactions patterns with their work group.
Employee Attitudes:
Employee attitudes such as increased job satisfaction may lead to increased absenteeism, more
voluntary resignations, and even labor strikes. Such events will often lead to changes in
management policies and practices.

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RESISTANCE TO CHANGE

In planning for change, the team leaders must take into consideration the various factors on
which the members exhibit their resistance to implement the change process. For example, the
company wanted to install a new software program in cash counter computer terminals to
facilitate the fast movement. But some employees may not respond favorably and display their
refusal to cooperate by increasing absenteeism, sub-standard work, joining of union increased
labor turn over etc. Resistance to change can also be a source of functional conflict. For example,
resistance to a reorganization plan or a change in a product line can stimulate a healthy debate
over the merits of the idea and result in a better decision.

Resistance can be overt, implicit, immediate or deferred. It is the easiest for management to deal
with resistance when it is overt and immediate such as employees strike, work slowdown etc.
The greater challenge is managing resistance that is implicit or deferred. Such as loss of loyalty
to the organization, loss of motivation to work, increased errors or mistakes increased
absenteeism etc. .

Individual Resistance2
Individual sources of resistance to change lie in basic human characteristics such as perceptions,
personalities and needs.

Habit: The team members are habituated or conditioned to do their job or activity in a
particular way. When they are asked to do differently, they tend to respond to resist change.
When employees are asked to move to new office building across the town, they are likely to
change their routine habits like waking up ten minutes earlier, finding new parking place,
adjusting to new office layout, developing new lunch time routine etc.

Security: The team members with a high need for security are likely to resist change because
it threatens their feelings of safety. When Indian Railway introduced new online booking for
their reservations, employees may have similar fears.

Economic Factors: If the members feel that the new changes result in lower pay, they may
likely to resist change process. Changes in jobs or established work routine can also arouse
economic fears if people are concerned that they won’t be able to perform the new tasks or
routines to their previous standards, especially when the pay is closely tied to productivity.

Fear of the Unknown: The cashiers or secretaries might fear the new activities due to lack
of knowledge in operating the new software program. They might develop a negative attitude
towards working with new programs or behave dysfunctionally if required to use them.
Employees in organizations hold the same dislike for uncertainty. For example, if an
organization introduced TQM, the production employees will have to learn statistical process
control techniques. Therefore, they may develop a negative attitude towards TQM or behavior
dysfunctionally if required, to use statistical techniques.

Selective Information Processing: Once the team members shape their world through their
own way, they prefer to do their work based on their perceptions. If the change process demands
to follow the new method, the members tend to resist. So individuals are guilty of selectively

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processing information in order to keep their perception intact. They hear what they want to hear.
They ignore information that challenges the world they have created.

Organizational Resistance

Some organizations prefer to follow their routine and reluctant to venture new things or
follow any new methods of doing. Government agencies want to continue doing what they have
been doing for years, whether the need for their service changes or remains the same. Six major
sources of organizational resistance have been identified. They are as follows:

Structural Inertia: Organizations have built in mechanisms to produce stability. For

instance, the training and orientation programs reinforce specific role requirements and skills.
Formalization provides job descriptions, rules and procedures for employees to follow. Once the
routine has been established, organization is very reluctant to adapt to new changes. When an
organization is confronted with the change process, the team members tend to resist.

Limited Focus of Change: The change process is interlinked. One activity cannot be
changed without affecting the others. If change is introduced in technology without considering
the structural changes, the change in technology is not likely to be accepted. Organizations are
made up of number of interdependent subsystems.

Group Inertia: Some times the group norm or standards could act as a constraint. For
example, the union norms may dictate resistance to change process.

Threat to Expertise: The change process could threaten the expertise of team members of
the groups. Once the members feel that they are forced to learn something new, they tend to
resist. The introduction of decentralized personal computers, which allow managers to gain
access to information directly from a company’s mainframe, is an example of a change that was
strongly resisted by many information system departments in the 1980s. Because of
decentralized end-user computing was a threat to the specialized skills held by those in the
centralized information system departments.

Threat to Established Power Relationship: The change process can threaten long
established power relationships within the organization. Due to this reason, the members can
resist the change.

Threat to established resource allocation: The group, which enjoys sizable resources, may
not like to accept the change process that facilitates reduction in their budget.

OVERCOMING RESISTANCE TO CHANGE

John Kotter and Leonard Schlesinger offered six ways of overcoming resistance to change,
which are highly situation dependent. More than one of these techniques may be used in any
given situations.
Education and Communication: If the logic and advantages of the change are explained
early to the team members, resistance can be reduced. This can be achieved through one-to-one
discussions, memos, group presentations, or reports. This tactics assumes that the source of
resistance lies in misinformed or poor communication. If the team members received the full

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facts and have their misunderstanding cleared up, their resistance will subside. Once people have
bought into the idea, they will implement the change. The only problem is that this could be very
time consuming process, if too many people are to be communicated with.
Participation and Involvement: Resistance to change can be reduced or eliminated by
having those involved participate in the decision of the change through meetings and induction.
It is difficult for individuals to resist a change decision in which they participated. Once people
have had an opportunity to contribute ideas and become a part of the change process, they will be
less inclined to see it fail. However, working in committees or task forces is a time consuming
activity, and hence it will take a longer time to bring about changes.
Facilitation and Support: Easing the change process and providing support for those caught
up in it is another way managers can deal with resistance. Retraining programs, allowing time off
after a difficult period, and offering emotional support and understanding may help. This
emotional support can be given through empathic listening, offering training and other types of
help. Such facilitation and emotional support help individual to deal more effectively with their
adjustment problems. This process can be time consuming and there is no guarantee that it will
always work.
Negotiation and Agreement: It is sometimes necessary for a team leader to negotiate with
potential resistance or exchange something of value for a lessening the resistance. For instance, if
the resistance is from a few powerful individuals in the team, a specific reward package can be
negotiated that will meet their individual needs. Though in some instances this may be the
relatively easy way to gain acceptance, it is possible that this could be an expensive way of
effecting changes as well. Also, if the use of this strategy becomes public knowledge, others
might also want to try to negotiate before they accept the change.
Manipulation and Co-optation: The team leader seeks to ‘buy off’ the key members who
are resisting by giving them an important role in the change decision. The team leader’s advice is
sought, not to arrive at a better decision but to get their endorsement. Some of the co-opting
tactics include selectively sharing information and consciously structuring certain types of events
that would win support. This can be a quick and relatively easy and inexpensive strategy to gain
support. However, the purpose will be defeated if people feel they are being manipulated.
Explicit and Implicit Coercion: The team leaders can force the members to go along with
changes by threats involving loss or transfers of jobs, lack of promotion, etc. Such methods,
though not uncommon, i s more difficult to gain support for future change efforts. This strategy
can be particularly resorted to when changes have to be speedily enforced or when changes are
of a temporary nature. Though speedy and effective in the short run, it may make people angry
and resort to all kinds of mean behaviors in the long run.

LEWIN’S MODEL OF CHANGE/APPROACHES TO

MANAGING ORG. CHANGE/PLANNED CHANGE
Kurt Lewin argued that successful change in organizations should follow three steps
i) Unfreezing the status quo
ii) Movement to a new state
iii) Refreezing the new change to make it permanent.
Unfreezing:
It is actually the process of preparing the system for change through disconfirmation of the old
practices, attitudes, tendencies, or behaviors. This is the initial phase where those involved in the
change experience a need for something different and a sense of restlessness with the status quo.
In essence, the feeling that the system is hurting itself badly now and desperately requires a

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change to survive, is sensed by all. Initiative for changes efforts are taken to overcome the
pressures of both individual resistance and group conformity.
Movement to a new state:
Changing or moving is the phase where the changes that have been planned are actually initiated
and carried out. Changes could relate to the mission, strategy, objectives, people, tasks, work
roles, technology, structure, corporate culture, or any other aspects of the organization. Well
thought out changes have to be carefully implemented with participation of the members who
will be affected by the change. Changes incorporated too quickly without adequate preparation
will result in resistance to change.
Refreezing:
It is the last phase of the planned change process. Refreezing ensures that the planned changes
that have been introduced are working satisfactorily, that any modifications, extra considerations,
or support needed for making the changes operational are attended to, and that there is
reasonable guarantee that the changes will indeed fill the gap and bring the system to the new,
desired state of equilibrium. This necessarily implies that the results are monitored and
evaluated, and wherever necessary corrective measures are taken up to reach the new goal. If the
refreezing phase is neglected or temporarily attended to, the desired results will not ensure and
the change may even be total disaster.
Forced Field Analysis:
Kurt Lewin stated that there are two types of forces operating in the change process. I) Those
forces which prepare or make the system ready for changes to occur, are called as driving forces,
ii) Those forces which oppose or operate against changes taking place in the system, are called as
restraining forces. If the two sets of forces are equal in strength, then the systems is in a state of
equilibrium and changes will not occur. If the driving forces are stronger than the restraining
forces, then the system will be changing to find a new equilibrium as the gap to be filled gets
narrowed down. A more viable option is to reduce existing resistance by dealing with and
minimizing the forces that resist the change. In practice, a combination of both strategies –
reducing the restraining factors and increasing the driving forces often ensures best results.

INTRODUCTION TO HUMAN RESOURCE MANAGEMENT

INTRODUCTION
HRM is the study of activities regarding people working in an organization. It is a
managerial function that tries to match an organization’s needs to the skills and abilities of its
employees.
Human resources management (HRM) is a management function concerned with hiring,
motivating and maintaining people in an organization. It focuses on people in organizations.
Human resource management is designing management systems to ensure that human talent is
used effectively and efficiently to accomplish organizational goals.

According to D. A. Decenzo and P.Robbins, “Human resource management is a process

consisting of four function:- acquisition, development, motivation and maintenance of human
resources.

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Nature of HRM
HRM is a management function that helps manager’s to recruit, select, train and develop
members for an organization. HRM is concerned with people’s dimension in organizations.
The following constitute the core of HRM
1. HRM Involves the Application of Management Functions and Principles. The functions
and principles are applied to acquiring, developing, maintaining and providing remuneration to
employees in organization.
2. Decision Relating to Employees must be Integrated. Decisions on different aspects of
employees must be consistent with other human resource (HR) decisions.
3. Decisions Made Influence the Effectiveness of an Organization. Effectiveness of an
organization will result in betterment of services to customers in the form of high quality
products supplied at reasonable costs.
4. HRM Functions are not Confined to Business Establishments Only but applicable to non-
business organizations such as education, health care, recreation and like.
HRM refers to a set of programmes, functions and activities designed and carried out in order to
maximize both employee as well as organizational effectiveness.
Scope of HRM
The scope of HRM is indeed vast. All major activities in the working life of a worker – from the
time of his or her entry into an organization until he or she leaves the organizations comes under
the purview of HRM. The major HRM activities include HR planning, job analysis, job design,
employee hiring, employee and executive remuneration, employee motivation, employee
maintenance, industrial relations and prospects of HRM.
The scope of Human Resources Management extends to:
All the decisions, strategies, factors, principles, operations, practices, functions, activities and
methods related to the management of people as employees in any type of organization.
All the dimensions related to people in their employment relationships, and all the dynamics
that flow from it.

American Society for Training and Development (ASTD) conducted fairly an exhaustive study
in this field and identified nine broad areas of activities of HRM.
These are given below:
Human Resource Planning
Design of the Organization and Job
Selection and Staffing
Training and Development
Organizational Development
Compensation and Benefits
Employee Assistance
Union/Labour Relations
Personnel Research and Information System

Objectives of HRM
1) Societal Objectives: seek to ensure that the organization becomes socially responsible to the
needs and challenges of the society while minimizing the negative impact of such demands upon
the organization.
2) Organizational Objectives: it recognizes the role of HRM in bringing about organizational
effectiveness. It makes sure that HRM is not a standalone department, but rather a means to
assist the organization with its primary objectives.

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3) Functional Objectives: is to maintain the department’s contribution at a level appropriate to

the organization’s needs.
4) Personnel Objectives: it is to assist employees in achieving their personal goals, at least as
far as these goals enhance the individual’s contribution to the organization. Personal objectives
of employees must be met if they are to be maintained, retained and motivated. Otherwise
employee performance and satisfaction may decline giving rise to employee turnover.

Functions of Human Resource Management

Human resource management has two function. The first one is managerial function and the
second one is staffing function.
Managerial Function
a)Planning
b)Organising
c)Directing
d)coordinating
e)Controlling
Staffing/Operating Function
a)Acquisition & Absorption
b)Development & Utilisation
c)Maintenance & Retention
d)Motivation & Empowerment

SELECTION
INTRODUCTION
Human resource selection is the process of choosing qualified individuals who are
available to fill positions in an organization. In the ideal personnel situation, selection involves
choosing the best applicant to fill a position. Selection is the process of choosing people by
obtaining and assessing information about the applicants with a view to matching these with the
job requirements. It involves a careful screening and testing of candidates who have put in their
applications for any job in the enterprise. It is the process of choosing the most suitable persons
out of all the applicants. The purpose of selection is to pick up the right person for every job.
It can be conceptualised in terms of either choosing the fit candidates, or rejecting the unfit
candidates, or combination of both. Selection involves both because it picks up the fits and
rejects the unfits. In fact, in Indian context, there are more candidates who are rejected than those
who are selected in most of the selection processes. Therefore, sometimes, it is called a negative
process in contrast to positive programme of recruitment.

According to Dale Yoder, “Selection is the process in which candidates for employment are
divided into two classes-those who are to be offered employment and those who are not”.
According to Keith Davis, “Selection is the process by which an organisation chooses from a
list of screened applicants, the person or persons who best meet the selection criteria for the
position available.”

Thus, the selection process is a tool in the hands of management to differentiate between the
qualified and unqualified applicants by applying various techniques such as interviews, tests etc.

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Difference between Recruitment and Selection: Difference between recruitment and selection
has been described by Flippo as, “Recruitment is a process of searching for prospective
employees and stimulating and encouraging them to apply for jobs in an organisation. It is often
termed positive as is stimulates people to apply for jobs, selection on the other hand tends to be
negative because it rejects a good number of those who apply, leaving only the best to be hired.”
Recruitment and selection differs in following manner:
1. Difference in Objective: The basic objective of recruitment is to attract maximum number of
candidates so that more options are available. The basic objective of selection is to choose best
out of the available candidates.
2. Difference is Process: Recruitment adopts the process of creating application pool as large as
possible and therefore. It is known as positive process. Selection adopts the process through
which more and more candidates are rejected and fewer candidates are selected or sometimes
even not a single candidate is selected. Therefore, it is known as negative process or rejection
process.
3. Technical Differences: Recruitment techniques are not very intensive, and not require high
skills. As against this, in selection process, highly specialized techniques are required. Therefore,
in the selection process, only personnel with specific skills like expertise in using selection tests,
conducting interviews, etc., are involved.
4. Difference in Outcomes: The outcome of recruitment is application pool which becomes
input for selection process. The outcome of selection process is in the form of finalising
candidates who will be offered jobs.
Selection Procedure
The selection procedure consists of a series of steps. Each step must be successfully cleared
before the applicant proceeds to the next. The selection process is a series of successive hurdles
or barriers which an applicant must cross. These hurdles are designed to eliminate an unqualified
candidate at any point in the selection process. Thus, this technique is called “Successive Hurdles
Technique”. In practice, the process differs among organisations and between two different jobs
within the same organisation. Selection procedure for the senior managers will be long drawn
and rigorous, but it is simple and short while hiring lower level employees.

Steps in Selection Process

1. Application Pool: Application pool built-up through recruitment process is the base for
selection process. The basic objective at the recruitment level is to attract as much worthwhile
applications as possible so that there are more options available at the selection stage.
2. Preliminary Screening and Interview: It is highly noneconomic to administer and handle all
the applicants. It is advantageous to sort out unsuitable applicants before using the further
selection steps. For this purpose, usually, preliminary interviews, application blank lists and short
test can be used. All applications received are scrutinized by the personnel department in order to
eliminate those applicants who do not fulfill required qualifications or work experience or
technical skill, his application will not be entertained. Such candidate will be informed of his
rejection.
Preliminary interview is a sorting process in which the prospective candidates are given the
necessary information about the nature of the job and the organisation. Necessary information is
obtained from the candidates about their education, skills, experience, expected salary etc. If the
candidate is found suitable, he is elected for further screening. This courtesy interview; as it is
often called helps the department screen out obvious misfits. Preliminary interview saves time
and efforts of both the company and the candidate. It avoids unnecessary waiting for the rejected

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candidates and waste of money on further processing of an unsuitable candidate. Since rejection
rate is high at preliminary interview, the interviewer should be kind, courteous, receptive and
informal.
3. Application Blank or Application Form: An application blank is a traditional widely
accepted device for getting information from a prospective applicant which will enable the
management to make a proper selection. The blank provides preliminary information as well as
aid in the interview by indicating areas of interest and discussion. It is a good means of quickly
collecting verifiable (and therefore fairly accurate) basic historical data from the candidate. It
also serves as a convenient device for circulating information about the applicant to appropriate
members of management and as a useful device for storing information for, later reference.
Many types of application forms, sometimes very long and comprehensive and sometimes brief,
are used. Information is generally taken on the following items:

(a) Biographical Data (b) Educational Attainment (c) Work Experience

(d) Salary and Benefits (e) Other Items

Its main usefulness is to provide information for reference checking, good interviewing, and
correlation with testing data.
It helps to weed out candidates who are lacking in education, experience or some other
eligibility traits.
It helps in formulating questions to be asked in the interview.
Data contained in application form can be stored for future reference.
It also tests the candidate’s ability to write, to organize his thoughts, and to present facts clearly
and succinctly.
It indicates further whether the applicant has consistently progressed to better jobs. It provides
factual information.
4. Selection Tests: Many organisations hold different kinds of selection tests to know more
about the candidates or to reject the candidates who cannot be called for interview etc. Selection
tests normally supplement the information provided in the application forms. Such forms may
contain factual information about candidates. Selection tests may give information about their
aptitude, interest, personality, which cannot be known by application forms. Types of tests are
given below:
A. Aptitude Tests B. Personality Tests C. Interest Tests D. Performance Tests:
E. Intelligence Tests F. Knowledge Tests G. Achievement Tests

5. Interview: An interview is a procedure designed to get information from a person and to

assess his potential for the job he is being considered on the basis of oral responses by the
applicant to oral inquiries by the interviewer. Interviewer does a formal in-depth conversation
with the applicant, to evaluate his suitability. It is one of the most important tools in the selection
process. This tool is used when interviewing skilled, technical, professional and even managerial
employees. It involves two-way exchange of information.
The interviewer learns about the applicant and the candidate learns about the employer.
Objectives of Interviews: Interview helps:
To obtain additional information from the candidate.
Facilitates giving to the candidate information about the job, company, its policies, products
etc.
To assess the basic suitability of the candidate.

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The selection interview can be:

One to one between the candidate and the interviewer:
Two or more interviewers by employers representatives-sequential;
By a panel of selections, i.e., by more than representative of the employer.
The sequential interview involves a series of interviews; each interviewer meeting the candidate
separately.
The panel interview consists of two or more interviews meeting the candidate together.
6. Background Investigation:
The background investigation has major implications. Every personnel administrator has the
responsibility to investigate each potential applicant. In some organization, failure to do so could
result in the loss of his or her job. But many managers consider the background investigation
data highly biased. Who would actually list a reference that would not give anything but the best
possible recommendation? The seasoned personnel administrator expects this and delves deeper
into the candidate’s background, but that, too, may not prove to be beneficial. Many past
employers are reluctant to give any information to another company other than factual
information (e.g., date of employment). Even though there is some reluctance to give this
information, there are ways in which personnel administrators can obtain it. Sometimes, for
instance information can be obtained from references once removed. For example, the personnel
administrator can ask a reference whose name has been provided on the application form to give
another reference, someone who has knowledge of the candidate’s work experience. By doing
this, the administrator can eliminate the possibility of accepting an individual based on the
employee’s current employer’s glowing recommendation when the motivation for such a
positive recommendation was to get rid of the employee.
7. Physical Examination: After the selection decision and before the job offer is made, the
candidate is required to undergo physical fitness test. Candidates are sent for physical
examination either to the company’s physician or to a medical officer approved for the purpose.
Such physical examination provides the following information.
Whether the candidate’s physical measurements are in accordance with job requirements or
not?
Whether the candidate suffers from bad health which should be corrected?
Whether the candidate has health problems or psychological attitudes likely to interfere with
work
efficiency or future attendance?
Whether the candidate is physically fit for the specific job or not?
8. Approval by Appropriate Authority: On the basis of the above steps, suitable candidates are
recommended for selection by the selection committee or personnel department. Though such a
committee or personnel department may have authority to select the candidates finally, often it
has staff authority to recommend the candidates for selection to the appropriate authority.
Organisations may designate the various authorities for approval of final selection of candidates
for different categories of candidates. Thus, for top level managers, board of directors may be
approving authority; for lower levels, even functional heads concerned may be approving
authority.
9. Final Employment Decision: After a candidate is finally selected, the human resource
department recommends his name for employment. The management or board of the company
offers employment in the form of an appointment letter mentioning the post, the rank, the salary
grade, the date by which the candidate should join and other terms and conditions of
employment. Some firms make a contract of service on judicial paper. Usually an appointment is
made on probation in the beginning. The probation period may range from three months to two

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years. When the work and conduct of the employee is found satisfactory, he may be confirmed.
The personnel department prepare a waiting list and informs the candidates. In case a person
does not join after being selected, the company calls next person on the waiting list.
10. Evaluation: The selection process, if properly performed, will ensure availability of
competent and committed personnel. A period audit, conducted by people who work
independently of the human resource department, will evaluate the effectiveness of the selection
process. The auditors will do a thorough and the intensive analysis and evaluate the employment
programme.

ORIENTATION
INTRODUCTION
After an employee has been recruited he is provided with basic background information
about the employer, working conditions and the information necessary to perform his job
satisfactorily. The new employee’s initial orientation helps him perform better by providing him
information of the company rules, and practices.
Orientation is a systematic and planned introduction of employees to their jobs, their co-
workers and the organization. It is otherwise known as induction.
In the words of John M. Ivancevich, “Orientation orients, directs, and guides employees to
understand the work, firm, colleagues, and mission. It introduces new employees to the
organisation, and to his new tasks, managers, and work groups.”
According to John Bernardin, “Orientation is a term used for the organizationally sponsored,
formalized activities associated with an employee’s socialization into the organisation.”

Thus, orientation is a process through which a new employee is introduced to the organisation. It
is the process wherein an employee is made to feel comfortable and at home in the organisation.
The new employee is handed over a rulebook, company booklets, policy manuals, progress
reports and documents containing company information which are informational in nature. It is
responsibility of the human resource department to execute the orientation programme.
Purpose of Orientation
a)To feel like home atmosphere
b)To reduce the anxiety level of new employee
c)For familiarization
For providing the information about working condition,rules,regulation etc.
Types of Orientation Programme
Formal Informal
Individual Collective
Serial Disjunctive
Investiture Divestiture
Requisites of an Effective Programme
a)Prepare for new employees
b)Determine information new employees want to know
c)Determine how to present the information
d)Completion of paper work

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TRAINING AND DEVELOPMENT

INTRODUCTION
Training is a process that tries to improve skills or add to the existing level of knowledge so
that the employee is better equipped to do his present job or to mould him to be fit for a higher
job involving higher responsibilities. It bridges the gap between what the employee has & what
the job demands. Training refers to a planned effort by a company to facilitate employees’
learning of job related competencies. These competencies include knowledge, skills, or
behaviors that are critical for successful job performance. The goal of training is for employees
to master the knowledge, skill, and behaviors emphasized in training programs and to apply them
to their day to day activities.

Training refers to the process of imparting specific skill whereas Development refers to the
learning opportunities designed to help employees grow

The term training refers to the acquisition of knowledge, skills, and competencies as a result of
the teaching of vocational or practical skills and knowledge that relate to specific useful
competencies. It forms the core of apprenticeships and provides the backbone of content at
institutes of technology (also known as technical colleges or polytechnics).
Training usually refers to some kind of organized (and finite it time) event — a seminar,
workshop that has a specific beginning data and end date. It’s often a group activity, but the
word training is also used to refer to specific instruction done one on one.
Employee development, however, is a much bigger, inclusive “thing”. For example, if a manager
pairs up a relatively new employee with a more experienced employee to help the new employee
learns about the job, that’s really employee development. If a manager coaches and employee in
an ongoing way, that’s employee development. Or, employees may rotate job responsibilities to
learn about the jobs of their colleagues and gain experience so they might eventually have more
promotion opportunities. That’s employee development.
In other words employee development is a broader term that includes training as one, and only
one of its methods for encouraging employee learning. The important point here is that different
activities are better for the achievement of different results. For example, if the desire is provide
an employee with a better understanding of how the department works, job rotation might work
very well. If the goal is to improve the employee’s ability to use a computer based accounting
package direct training would be more appropriate than, let’s say, job rotation.

TRAINING AND DEVELOPMENT OBJECTIVES

The principal objective of training and development division is to make sure the availability of a
skilled and willing workforce to an organization. In addition to that, there are four other
objectives: Individual, Organizational, Functional, and Societal. Training and development is a
subsystem of an organization. It ensures that randomness is reduced and learning or behavioural
change takes place in structured format.
Individual Objectives – help employees in achieving their personal goals, which in turn,
enhances the individual contribution to an organization.
Organizational Objectives – assist the organization with its primary objective by bringing
individual effectiveness.
Functional Objectives – maintain the department’s contribution at a level suitable to the
organization’s needs.

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Societal Objectives – ensure that an organization is ethically and socially responsible to the
needs and challenges of the society.
The quality of employees and their development through training and education are major factors
in determining long-term profitability of a small business. If you hire and keep good employees,
it is good policy to invest in the development of their skills, so they can increase their
productivity.
Training often is considered for new employees only. This is a mistake because ongoing training
for current employees helps them adjust to rapidly changing job requirements. Reasons for
emphasizing the growth and development of personnel include

Creating a pool of readily available and adequate replacements for personnel who may leave or
move up in the organization.
Enhancing the company’s ability to adopt and use advances in technology because of a
sufficiently knowledgeable staff.
Building a more efficient, effective and highly motivated team, which enhances the company’s
competitive position and improves employee morale.
Ensuring adequate human resources for expansion into new programs.
Research has shown specific benefits that a small business receives from training and developing
its workers, including:
Increased productivity.
Reduced employee turnover.
Increased efficiency resulting in financial gains.
Decreased need for supervision.
Employees frequently develop a greater sense of self-worth, dignity and well-being as they
become more valuable to the firm and to society. Generally they will receive a greater share of
the material gains that result from their increased productivity. These factors give them a sense
of satisfaction through the achievement of personal and company goals.

IMPORTANCE

Training is crucial for organizational development and success. It is fruitful to both employers
and employees of an organization. An employee will become more efficient and productive if he
is trained well. The benefits of training can be summed up as:
1. Improves Morale of Employees- Training helps the employee to get job security and job
satisfaction. The more satisfied the employee is and the greater is his morale, the more he will
contribute to organizational success and the lesser will be employee absenteeism and turnover.
2. Less Supervision- A well trained employee will be well acquainted with the job and will need
less of supervision. Thus, there will be less wastage of time and efforts.
3. Fewer Accidents- Errors are likely to occur if the employees lack knowledge and skills
required for doing a particular job. The more trained an employee is, the less are the chances of
committing accidents in job and the more proficient the employee becomes.
4. Chances of Promotion- Employees acquire skills and efficiency during training. They
become more eligible for promotion. They become an asset for the organization.
5. Increased Productivity- Training improves efficiency and productivity of employees. Well
trained employees show both quantity and quality performance. There is less wastage of time,
money and resources if employees are properly trained.

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Types of Employee Training

Some commentator use a similar term for workplace learning to improve performance: “training
and development”. One can generally categorize such training as on-the-job or off-the-job:
On-the-job training takes place in a normal working situation, using the actual tools,
equipment, documents or materials that trainees will use when fully trained. On-the-job training
has a general reputation as most effective for vocational work.
Off-the-job training takes place away from normal work situations — implying that the
employee does not count as a directly productive worker while such training takes place. Off-
the-job training has the advantage that it allows people to get away from work and concentrate
more thoroughly on the training itself. This type of training has proven more effective in
inculcating concepts and ideas.

The four techniques for on the job training are:

COACHING
MENTORING
JOB ROTATION
JOB INSTRUCTION TECHNIQUE (JIT)
1.) Coaching is one of the training methods, which is considered as a corrective method for
inadequate performance.
This method best suits for the people at the top because if we see on emotional front, when a
person reaches the top, he gets lonely and it becomes difficult to find someone to talk to. It helps
in finding out the executive’s specific developmental needs

Procedure of the Coaching

The procedure of the coaching is mutually determined by the executive and coach. The
procedure is followed by successive counseling and meetings at the executive’s convenience by
the coach.
1. Understand the participant’s job, the knowledge, skills, and attitudes, and resources required to
meet the desired expectation.
2. Meet the participant and mutually agree on the objective that has to be achieved.
3. Mutually arrive at a plan and schedule.
4. At the job, show the participant how to achieve the objectives, observe the performance and
then provide feedback.
5. Repeat step 4 until performance improves.

For the people at middle level management, coaching is more likely done by the supervisor;
however experts from outside the organization are at times used for up and coming managers.
Again, the personalized approach assists the manger focus on definite needs and improvement.

2.) Mentoring is an ongoing relationship that is developed between a senior and junior
employee. Mentoring provides guidance and clear understanding of how the organization goes to
achieve its vision and mission to the junior employee.
The meetings are not as structured and regular than in coaching. Executive mentoring is
generally done by someone inside the company. The executive can learn a lot from mentoring.
By dealing with diverse mentee’s, the executive is given the chance to grow professionally by
developing management skills and learning how to work with people with diverse background,
culture, and language and personality types. Executives also have mentors. In cases where the
executive is new to the organization, a senior executive could be assigned as a mentor to assist

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the new executive settled into his role. Mentoring is one of the important methods for preparing
them to be future executives. This method allows the mentor to determine what is required to
improve mentee’s performance. Once the mentor identifies the problem, weakness, and the area
that needs to be worked upon, the mentor can advise relevant training. The mentor can also
provide opportunities to work on special processes and projects that require use of proficiency.

3.) For the executive, job rotation takes on different perspectives. The executive is usually not
simply going to another department. In some vertically integrated organizations, for example,
where the supplier is actually part of same organization or subsidiary, job rotation might be to
the supplier to see how the business operates from the supplier point of view.
Learning how the organization is perceived from the outside broadens the executive’s outlook on
the process of the organization. Or the rotation might be to a foreign office to provide a global
perspective. For managers being developed for executive roles, rotation to different functions in
the company is regular carried out.
This approach allows the manger to operate in diverse roles and understand the different issues
that crop up. If someone is to be a corporate leader, they must have this type of training. A recent
study indicated that the single most significant factor that leads to leader’s achievement was the
variety of experiences in different departments, business units, cities, and countries.
An organized and helpful way to develop talent for the management or executive level of the
organization is job rotation. It is the process of preparing employees at a lower level to replace
someone at the next higher level. It is generally done for the designations that are crucial for the
effective and efficient functioning of the organization.
Some of the major benefits of job rotation are:
It provides the employees with opportunities to broaden the horizon of knowledge, skills, and
abilities by working in different departments, business units, functions, and countries
Identification of Knowledge, skills, and attitudes (KSAs) required
It determines the areas where improvement is required
Assessment of the employees who have the potential and caliber for filling the position
4.) Job Instruction Technique (JIT) uses a strategy with focus on knowledge (factual and
procedural), skills and attitudes development.
JIT Consists of Four Steps:
Plan – This step includes a written breakdown of the work to be done because the trainer and the
trainee must understand that documentation is must and important for the familiarity of work. A
trainer who is aware of the work well is likely to do many things and in the process might miss
few things. Therefore, a structured analysis and proper documentation ensures that all the points
are covered in the training program.
The second step is to find out what the trainee knows and what training should focus on. Then,
the next step is to create a comfortable atmosphere for the trainees’ i.e. proper orientation
program, availing the resources, familiarizing trainee with the training program, etc.
Present – In this step, trainer provides the synopsis of the job while presenting the participants
the different aspects of the work. When the trainer finished, the trainee demonstrates how to do
the job and why is that done in that specific manner. Trainee actually demonstrates the procedure
while emphasizing the key points and safety instructions.
Steps in JIT
Trial – This step actually a kind of rehearsal step, in which trainee tries to perform the work and
the trainer is able to provide instant feedback. In this step, the focus is on improving the method
of instruction because a trainer considers that any error if occurring may be a function of training

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not the trainee. This step allows the trainee to see the after effects of using an incorrect method.
The trainer then helps the trainee by questioning and guiding to identify the correct procedure.

Follow-up – In this step, the trainer checks the trainee’s job frequently after the training program
is over to prevent bad work habits from developing. There are various methods of training,
which can be divided in to cognitive and behavioral methods. Trainers need to understand the
pros and cons of each method, also its impact on trainees keeping their background and skills in
mind before giving training.
OFF THE JOB TRAINING –
There are many management development techniques that an employee can take in off the job.
The few popular methods are:
SENSITIVITY TRAINING
TRANSACTIONAL ANALYSIS
STRAIGHT LECTURES/ LECTURES
SIMULATION EXERCISES
1.) Sensitivity Training is about making people understand about themselves and others
reasonably, which is done by developing in them social sensitivity and behavioral flexibility.
Social sensitivity in one word is empathy. It is ability of an individual to sense what others feel
and think from their own point of view. Behavioral flexibility is ability to behave suitably in
light of understanding.
Sensitivity Training Program requires three steps:
Unfreezing the Old Values –
It requires that the trainees become aware of the inadequacy of the old values. This can be done
when the trainee faces dilemma in which his old values is not able to provide proper guidance.
Development of New Values – With the trainer’s support, trainees begin to examine their
interpersonal behavior and giving each other feedback. The reasoning of the feedbacks are
discussed which motivates trainees to experiment with range of new behaviors and values. This
process constitutes the second step in the change process of the development of these values.

Refreezing the new ones – This step depends upon how much opportunity the trainees get to
practice their new behaviors and values at their work place.
2.) Transactional Analysis provides trainees with a realistic and useful method for analyzing
and understanding the behavior of others. In every social interaction, there is a motivation
provided by one person and a reaction to that motivation given by another person. This
motivation reaction relationship between two persons is a transaction.
Transactional analysis can be done by the ego states of an individual. An ego state is a system
of feelings accompanied by a related set of behaviors. There are basically three ego states:
Child: It is a collection of recordings in the brain of an individual of behaviors, attitudes, and
impulses which come to her naturally from her own understanding as a child. The characteristics
of this ego are to be spontaneous, intense, unconfident, reliant, probing, anxious, etc. Verbal
clues that a person is operating from its child state are the use of words like “I guess”, “I
suppose”, etc. and nonverbal clues like, giggling, coyness, silent, attention seeking etc.
Parent: It is a collection of recordings in the brain of an individual of behaviors, attitudes, and
impulses imposed on her in her childhood from various sources such as, social, parents, friends,
etc. The characteristics of this ego are to be overprotective, isolated, rigid, bossy, etc. Verbal
clues that a person is operating from its parent states are the use of words like, always, should,
never, etc and non-verbal clues such as, raising eyebrows, pointing an accusing finger at
somebody, etc.

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Adult: It is a collection of reality testing, rational behavior, decision making, etc. A person in
this ego state verifies, updates the data which she has received from the other two states. It is a
shift from the taught and felt concepts to tested concepts. All of us evoke behavior from one ego
state which is responded to by the other person from any of these three states.
3.) Lecture is telling someone about something. Lecture is given to enhance the knowledge of
listener or to give him the theoretical aspect of a topic. Training is basically incomplete without
lecture. When the trainer begins the training session by telling the aim, goal, agenda, processes,
or methods that will be used in training that means the trainer is using the lecture method. It is
difficult to imagine training without lecture format. There are some variations in Lecture method.
The variation here means that some forms of lectures are interactive while some are not.
Straight Lecture: Straight lecture method consists of presenting information, which the trainee
attempts to absorb. In this method, the trainer speaks to a group about a topic. However, it does
not involve any kind of interaction between the trainer and the trainees. A lecture may also take
the form of printed text, such as books, notes, etc. The difference between the straight lecture and
the printed material is the trainer’s intonation, control of speed, body language, and visual image
of the trainer. The trainer in case of straight lecture can decide to vary from the training script,
based on the signals from the trainees, whereas same material in print is restricted to what is
printed. A good lecture consists of introduction of the topic, purpose of the lecture, and priorities
and preferences of the order in which the topic will be covered.
Some of the main features of lecture method are:
Inability to identify and correct misunderstandings
Less expensive
Can be reached large number of people at once
Knowledge building exercise
Less effective because lectures require long periods of trainee inactivity

4.) Games and Simulations are structured and sometimes unstructured, that are usually played
for enjoyment sometimes are used for training purposes as an educational tool. Training games
and simulations are different from work as they are designed to reproduce or simulate events,
circumstances, processes that take place in trainees’ job. A Training Game is defined as spirited
activity or exercise in which trainees compete with each other according to the defined set of
rules. Simulation is creating computer versions of real-life games. Simulation
is about imitating or making judgment or opining how events might occur in a real situation. It
can entail intricate numerical modeling, role playing without the support of technology, or
combinations. Training games and simulations are now seen as an effective tool for training
because its key components are:
Challenge
Rules
Interactivity
These three components are quite essential when it comes to learning. Some of the examples of
this technique are:
Trainees can therefore experience these events, processes, games in a controlled setting where
they can develop knowledge, skills, and attitudes or can find out concepts that will improve their
performance.
Objectives and Process of Employee Training
The training design process refers to a systematic approach for developing training programs. It
includes the seven steps in this process. Training is one of the most profitable investments an
organization can make. No matter what business or industry you are in the steps for an effective

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training process are the same and may be adapted anywhere. If you have ever thought about
developing a training program within your organization consider the following four basic
training steps. You will find that all four of these steps are mutually necessary for any training
program to be effective and efficient.
Step1 is to conduct a needs assessment, which is necessary to identify whether training is
needed. This step identifies activities to justify an investment for training. The techniques
necessary for the data collection are surveys, observations, interviews, and customer comment
cards. Several examples of an analysis outlining specific training needs are customer
dissatisfaction, low morale, low productivity, and high turnover.
The objective in establishing a needs analysis is to find out the answers to the following
questions:
“Why” is training needed?
“What” type of training is needed?
“When” is the training needed?
“Where” is the training needed?
“Who” needs the training? and “Who” will conduct the training?
“How” will the training be performed?
By determining training needs, an organization can decide what specific knowledge, skills, and
attitudes are needed to improve the employee’s performance in accordance with the company’s
standards.
The needs analysis is the starting point for all training. The primary objective of all training is to
improve individual and organizational performance. Establishing a needs analysis is, and should
always be the first step of the training process.
Step 2 is to ensure that employees have the motivation and basic skills necessary to master
training content. This step establishes the development of current job descriptions and standards
and procedures. Job descriptions should be clear and concise and may serve as a major training
tool for the identification of guidelines. Once the job description is completed, a complete list of
standards and procedures should be established from each responsibility outlined in the job
description. This will standardize the necessary guidelines for any future training.
Step 3 is to create a learning environment that has the features necessary for learning to occur.
This step is responsible for the instruction and delivery of the training program. Once you have
designated your trainers, the training technique must be decided. One-on-one training, on-the-job
training, group training, seminars, and workshops are the most popular methods.
Before presenting a training session, make sure you have a thorough understanding of the
following characteristics of an effective trainer. The trainer should have:

- A desire to teach the subject being taught.

- A working knowledge of the subject being taught.
- An ability to motivate participants to “want” to learn.
- A good sense of humour.
- A dynamic appearance and good posture.
- A strong passion for their topic.
- A strong compassion towards their participants.
- Appropriate audio/visual equipment to enhance the training session.
For a training program to be successful, the trainer should be conscious of several essential
elements, including a controlled environment, good planning, the use of various training
methods, good communication skills and trainee participation.
Step 4 is to ensure that trainees apply the training content to their jobs.

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This step will determine how effective and profitable your training program has been. Methods
for evaluation are pre-and post- surveys of customer comments cards, the establishment of a
cost/benefit analysis outlining your expenses and returns, and an increase in customer
satisfaction and profits. The reason for an evaluation system is simple. The evaluations of
training programs are without a doubt the most important step in the training process. It is this
step that will indicate the effectiveness of both the training as well as the trainer.
There are several obvious benefits for evaluating a training program. First, evaluations will
provide feedback on the trainer’s performance, allowing them to improve themselves for future
programs. Second, evaluations
will indicate its cost-effectiveness. Third, evaluations are an efficient way to determine the
overall effectiveness of the training program for the employees as well as the organization.
The importance of the evaluation process after the training is critical. Without it, the trainer does
not have a true indication of the effectiveness of the training. Consider this information the next
time you need to evaluate your training program. You will be amazed with the results.
The need for training your employees has never been greater. As business and industry continues
to grow, more jobs will become created and available. Customer demands, employee morale,
employee productivity, and employee turnover as well as the current economic realities of a
highly competitive workforce are just some of the reasons for establishing and implementing
training in an organization. To be successful, all
training must receive support from the top management as well as from the middle and
supervisory levels of management. It is a team effort and must be implemented by all members
of the organization to be fully successful.

PERFORMANCE APPRAISAL
MEANING
Performance appraisal is the systematic assessment of an individual with respect to
his or her performance on the job and his or her potential for development in that job. Thus,
performance appraisal is a systematic and objective way of evaluating the relative worth or
ability of an employee in performing his job.
Performance appraisal is an objective assessment of an individual performance against well-
defined benchmark.
According to Flippo, a prominent personality in the field of Human resources, “performance
appraisal is the systematic, periodic and an impartial rating of an employee’s excellence in the
matters pertaining to his present job and his potential for a better job.”

NEED AND IMPORTANCE

Performance is always measured in terms of outcome and not efforts. Performance Appraisal is
needed in most of the organizations in order:
(1) To give information about the performance of employees on the job and give ranks on the
basis of which decisions regarding salary fixation, demotion, promotion, transfer and
confirmation are taken.
(2) To provide information about amount of achievement and behavior of subordinate in their
job.
This kind of information helps to evaluate the performance of the subordinate, by correcting
loopholes in performances and to set new standards of work, if required.
(3) To provide information about an employee’s job-relevant strengths and & weaknesses.

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(4) To provide information so as to identify shortage in employee regarding ability, awareness

and find out training and developmental needs.
(5) To avoid grievances and in disciplinary activities in the organization.
(6) It is an ongoing process in every large scale organization.
Performance appraisals in an organization provide employees and managers with an
opportunity to converse in the areas in which employees do extremely well and those in which
employees need improvement. Performance appraisals should be conducted on a frequent basis,
and they need not be directly attached to promotion opportunities only. It is important because of
several reason s such as:
1. Personal Attention: Performance appraisal evaluation, gives employee to draw personal
concern from supervisor and talk about their own strengths and weaknesses.
2. Feedback: Employees on a regular basis get feedback of their performances and issues in
which they lack, which needs to be resolved on a regular basis.
3. Career Path: It allows employees and supervisors to converse goals that must be met to grow
within the company. This may encompass recognizing skills that must be acquired, areas in
which improvement is required, and additional qualification that must be acquired.
4. Employee Accountability: Employees are acquainted that their evaluation will take place on
a regular basis and therefore they are accountable for their job performance.
5. Communicate Divisional and Company Goals: It not only communicates employees’
individual goals but provides an opportunity for managers to explain organizational goals and in
the manner in which employees can contribute in the achievement of those goals.

PAST ORIENTED METHODS:

Performance appraisal methods are categorized in two ways past oriented and future oriented
methods.
1. Ranking Method: It is the oldest and simplest method of performance appraisal in which
employees’ are ranked on certain criteria such as trait or characteristic. The employee is ranked
from highest to lowest or from worst to best in an organization. Thus if there are seven
employees to be ranked then there will be seven ranks from 1 to 7.
Rating scales offer the advantages of flexibility comparatively easy use and low cost. Nearly
every type of job can be evaluated with the rating scale, the only condition being that the Job-
performance criteria should he changed’ .In such a way, a large number of employees can be
evaluated in a shorter time period.
Thus, the greatest limitation of this method is that differences in ranks do not indicate how much
an employee of rank 1 is better than the employee whose rank is last.
2. Paired Comparison: In method is comparatively simpler as compared to ranking method. In
this method, the evaluator ranks employees by comparing one employee with all other
employees in the group. The rater is given slips where, each slip has a pair of names, the rater
puts a tick mark next those employee whom he considers to be the better of the two. This
employee is compared number of times so as to determine the final ranking.
This method provides comparison of persons in a better way. However, this increases the work
as the large number of comparisons has to be made. For example, to rank 50 persons through
paired comparison, there will be 1,225 comparisons. Paired comparison method could be
employed easily where the numbers of employees to be compared are less.
This may be calculated by a formula N (N — 1)12 where N is the total number of persons to be
compared.
Where N is the total number of persons to be evaluated.

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3. Grading Method: In this method, certain categories are defined well in advance and
employees are put in particular category depending on their traits and characteristics. Such
categories may be defined as outstanding, good, average, poor, very poor, or may be in terms of
alphabet like A, B, C, D, etc. where A may indicate the best and D indicating the worst. This
type of grading method is applied during Semester pattern of examinations. One of the major
limitations of this method is that the rater may rate many employees on the better side of their
performance.
4. Forced Distribution Method: This method was evolved to abolish the trend of rating most of
the employees at a higher end of the scale. The fundamental assumption in this method is that
employees’ performance level conforms to a normal statistical distribution. For example, 10 per
cent employees may be rated as excellent, 40 per cent as above average, 20 per cent as average,
10 per cent below average, and 20 per cent as poor. It eliminates or minimizes the favoritism of
rating many employees on a higher side. It is simple and easy method to appraise employees. It
becomes difficult when the rater has to explain why an employee is placed in a particular
grouping as compared to others.
5. Forced-choice Method: The forced-choice rating method contains a sequence of question in a
statement form with which the rater checks how effectively the statement describes each
individual being evaluated in the organization. There may be some variations in the methods and
statements used, but the most common method of forced choice contains two statements both of
which may be positive or negative. It may be both the statement describes the characteristics of
an employee, but the rater is forced to tick only one i.e the most appropriate statement which
may be more descriptive of the employee.

6. Check-list Method: The main reason for using this method is to reduce the burden of
evaluator. In this method of evaluation the evaluator is provided with the appraisal report which
consist of series of questions which is related to the appraise. Such questions are prepared in a
manner that reflects the behavior of the concerned appraise. Every question has two alternatives,
yes or no, as given below:
1. Is he/she respected by his/her subordinates? Yes/No
2. Is he/she ready to help other employees? Yes/No
3. Does her behavior remain same for everyone in the organization? Yes/No
The concerned rater/evaluator has to tick appropriate answers relevant to the appraises.
When the check-list is finished, it is sent to the personnel department to prepare the final scores
for all appraises based on all questions based on yes or no. While preparing question effort is
made to establish the level of consistency of the rater by asking the same question twice but in a
different manner. This method is considered to be easy if questions are framed properly for
different categories of employees.
However, one of the disadvantages of the check-list method is that it is very difficult to
accumulate, analyze and evaluate a number of statements about employee characteristics and
contributions. It is even costly method with lot of time and efforts required by the organization.
7. Critical Incidents Method: This method is very useful for finding out those employees who
have the highest potential to work in a critical situation. Such an incidence is very important for
organization as they get a sense, how a supervisor has handled a situation in the case of sudden
trouble in an organization, which gives an idea about his leadership qualities and handling
of situation. It is also said to be a continuous appraisal method where employees are appraised
continuously by keeping in mind the critical situation. In this method, only the case of sudden
trouble and behavior associated with these incidents or trouble are taken for evaluation.

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This method is categorized in three steps. First, a list of notable (good or bad) on-the-job
behavior of specific incidents or sudden trouble is prepared. Second, selected experts would then
assign weightage or score to these incidents according to how serious a particular incident is and
their degree of willingness to perform a job. Third, finally a check-list indicating incidents that
illustrate workers as good or “bad” is formed. Then, the checklist is given to the rater for
evaluating the workers. The strong point of critical incident method is that it focuses on
behaviors and, thus, judge’s performance rather than personalities.
Its drawbacks are that too frequently they need to write down the critical incidents which is very
time consuming and burdensome for evaluators, i.e., managers. Generally, negative incidents are
more noticeable than positives.
8. Graphic Scale Method: It is one of the simplest and most popular techniques for appraising
performances of employee. It is also known as linear rating scale. In graphic rating scale the
printed appraisal form is used to appraise each employee.
Such forms contain a number of objectives, and trait qualities and characters to be rated like
quality of work and amount of work, job knowhow dependability, initiative, attitude, leadership
quality and emotional stability.
The rater gives an estimate the extent to which subordinates possess each quality. The extent to
which quality is possessed is measured on a scale which can vary from three points to several
points. In general practice five-point scales is used. Some organizations use numbers in order to
avoid the propensity of the rater to tick mark central points. It may be numbered or defined. Thus
numbers like 5, 4, 3, 2 and 1 may denote points for various degrees of excellent-poor, high-low,
or good-bad, and so on. Such numbers may be expressed in terms like excellent, very good,
average, poor and very poor; or very high, high, average, low and very low.
Graphic scale method is good for measuring various job behaviors of an employee. But, it is
bound to limitations of rater’s bias while rating employee’s behavior at job.
9. Essay Method: In this method, the rater writes a detailed description on an employee’s
characteristics and behavior, Knowledge about organizational policies, procedures and rules,
Knowledge about the job, Training and development needs of the employee, strengths,
weakness, past performance, potential and suggestions for improvement. It is said to be the
encouraging and simple method to use. It does not need difficult formats and specific training to
complete it.
10. Field Review Method: In this method of appraisal direct superior is not going to appraise an
employee but appraised by another person, usually, from personnel department .The rater, in
such a case, appraises the employee on the basis of his past records of productivity and other
information such as absenteeism,
late corning, etc. It is more suitable in a situation where an organization wants to provide
promotion to an employee. It also gives information for comparing employees from different
locations and units. It reduces partiality to some extent as personnel department person is
supposed to be trained in appraisal mechanism. This method suffers from two limitations:
1. As employees are not rated by immediate boss, the rater from other department may not be
familiar with the conditions in an employee’s work environment which may hamper his ability
and work motivation to perform.
2. The rater from other department do not get a chance to scrutinize the employee’s behavior or
performance with different time interval and in a variety of situations, but only in an unnaturally
structured interview situation which is for a very short period of time.

Behaviorally Anchored Rating Scales: This method is a combination of traditional rating

scales and critical incidents methods. It consists of preset critical areas of job performance or sets

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of behavioral statements which describes the important job performance qualities as good or bad
(for e.g. the qualities like inter personal relationships, flexibility and consistency, job knowledge
etc). These statements are developed from critical incidents.
These behavioral examples are then again translated into appropriate performance dimensions.
Those that are selected into the dimension are retained. The final groups of behavior incidents
are then scaled numerically to a level of performance that is perceived to represent. A rater must
indicate which behavior on each scale best describes an employee’s performance. The results of
the above processes are behavioral descriptions, such as anticipate, plan, executes, solves
immediate problems, carries out orders, and handles urgent situation situations. This method has
following advantages: a) It reduces rating errors) Behavior is assessed over traits. c) It gives an
idea about the behavior to the employee and the rater about which behaviors bring good
Performance and which bring bad performance.

FUTURE ORIENTED METHODS

1. Management by Objectives (MB0): The concept of ‘Management by Objectives’ (MBO)
was coined by Peter Drucker in 1954. It is a process where the employees and the superiors come
together to identify some goals which are common to them, the employees set their own goals to
be achieved, the benchmark is taken as the criteria for measuring their performances and their
involvement is there in deciding the course of action to be followed.
The basic nature of MBO is participative, setting their goals, selecting a course of actions to
achieve goals and then taking decision. The most important aspect of MBO is measuring the
actual performances of the employee with the standards set by them. It is also said to be a
process that integrates organizational objectives into individual objectives.
Entire program me of MBO is divided in four major steps i.e setting up of goal, action planning,
comparison and timely review.
Setting up of goal-In goal setting superior and subordinate together set certain goals, i.e the
expected outcome that each employee is supposed to achieve.
In action planning, the manner in which goals could be achieved is determined i.e. identifying
the activities which are necessary to perform; to achieve pr determined goals or standards. When
the employees start with their activities, they come to know what is to be done, what has been
done, and what remains to be done and it also gives an idea about the resources to be achieved.
In the third step, the goals set by the individual employee are compared with the actual goals
achieved. It gives an idea to the evaluator as why there is a variation in desired outcome and
actual outcome .Such a comparison helps create need for training so as to enhance employees’
performance. Finally, in the timely review step, corrective actions are taken so that actual
performances do not deviates from standards established in beginning.
The main reason for conducting reviews is not to humiliate the performer but to assist him in
better performances in future.
2. Assessment Centres: It is a method which was first implemented in German Army in 1930.
With the passage of time industrial houses and business started using this method. This is a
system of assessment where individual employee is assessed by many experts by using different
technique of performance appraisal. The techniques which may be used are role playing, case
studies, simulation exercises, transactional analysis etc.
In this method employees from different departments are brought together for an assignment
which they are supposed to perform in a group, as if they are working for a higher post or
promoted. Each employee is ranked by the observer on the basis of merit .The basic purpose
behind assessment is to recognize whether a particular employee can be promoted, or is there any
need for training or development. This method has certain advantages such as it helps the

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observer in making correct decision in terms of which employee has the capability of getting
promoted, but it has certain disadvantages also it is costly and time consuming, discourages the
poor performers etc.

The Performance Appraisal Process

The performance appraisal system of one organization may vary from other organizations,
though some of the specific steps that an organization may follow are as follows:
1. Establish Performance Standards: It begins by establishing performance standards i.e. what
they expect from their employee in terms of outputs, accomplishments and skills that they will
evaluate with the passage of time. The standards set should be clear and objective enough to be
understood and measured. The standards which are set are evolved out of job analysis and job
descriptions. Standards set should be clear and not the vague one. The expectation of the
manager from his employee should be clear so that it could be communicated to the subordinates
that they will be appraised against the standards set for them.
2. Communicating the Standards Set for an Employee: Once the standards for performance
are set it should be communicated to the concerned employee, about what it expected from them
in terms of performance. It should not be part of the employees’ job to estimate what they are
expected do. Communication is said to be two ways street, mere passing of information to
subordinate does not mean that the work is done. Communication only takes place when the
information given has taken place and has been received and understood by subordinate. . If
necessary, the standards may be tailored or revised in the light of feedback obtained from the
employees.
3. Measuring of the Actual Performances: It is one of the most crucial steps of performance
appraisal process. It is very important to know as how the performance will be measured and
what should be measured, thus four important sources frequently used by managers are personal
observation, statistical reports, oral reports, and written reports. However, combination of all

these resources gives more reliable information. What we measure is probably more critical to
the evaluation process than how we measure. The selection of the incorrect criteria can result in
serious consequences. What we measure gives an idea about what people in an organization will
attempt to achieve. The criteria which are considered must represent performance as stated in the
first two steps of the appraisal process.
4. Comparing Actual Performance with Standards Set in the Beginning: In this step of
performance appraisal the actual performance is compared with the expected or desired standard
set. A comparison between actual or desired standard may disclose the deviation between
standard performance and actual performance and will allow the evaluator to carry on with the
discussion of the appraisal with the concerned employees.
5. Discussion with the Concerned Employee: In this step performance of the employee is
communicated and discussed. It gives an idea to the employee regarding their strengths and
weaknesses. The impact of this discussion may be positive or negative. The impression that
subordinates receive from their assessment has a very strong impact on their self-esteem and, is
very important, for their future performances.
6. Initiate Corrective Action: Corrective action can be of two types; one is instant and deals
primarily with symptoms. The other is basic and deals with the causes. Instant corrective action
is often described as “putting out fires”, whereas basic corrective action gets to the source from
where deviation has taken place and seeks to adjust the differences permanently. Instant action

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corrects something right at a particular point and gets things back on track. Basic action asks
how and why performance deviated. In some instances, managers may feel that they do not have
the time to take basic corrective action and thus may go for “perpetually put out fires.
Thus the appraisal system of each organization may differ as per the requirement of that
Organization.
Problems of Performance Appraisal
Performance appraisal technique is very beneficial for an organization for taking decisions
regarding salary fixation, demotion, promotion, transfer and confirmation etc. But it is not freed
from problem In spite of recognition that a completely error-free performance appraisal can only
be idealized a number of errors that extensively hinder objective evaluation. Some of these
problems are as follows:
Biasness in rating employee: It is the problem with subjective measure i.e. the rating which will
not be verified by others. Biasness of rater may include:
(a) Halo Effect: It is the propensity of the raters to rate on the basis of one trait or behavioral
consideration in rating all other traits or behavioral considerations. One way of minimizing the
halo effect is appraising all the employees by one trait before going to rate on the basis of
another trait.
(b) The Central Tendency Error: It is the error when rater tries to rate each and every person on
the middle point of the rating scale and tries not to rate the people on both ends of the scale that
is rating too high or too low. They want to be on the safer side as they are answerable to the
management.
(c) The Leniency and Strictness Biases: The leniency biasness exists when some raters have a
tendency to be generous in their rating by assigning higher rates constantly. Such ratings do not
serve any purpose.
(d) Personal prejudice: If the raters do not like any employee or any group, in such circumstances
he may rate him on the lower side of the scale, the very purpose of rating is distorted which
might affect the career of employees also.
(e) The Recent Effect: The raters usually retain information about the recent actions of the
employee at the time of rating and rate on the basis of recent action taken place which may be
favorable or unfavorable at that point of time.

INCENTIVES

INTRODUCTION
Incentives are monetary benefits paid to workmen in recognition of their outstanding
performance. It is otherwise known as payment by result Incentives vary from individual to
individual and from period to period for the same individual. They are universal and are paid in
every sector. It works as motivational force to work for their performance as incentive forms the
part total remuneration. Incentives when added to salary increase the earning thus increase the
standard of living. The advantage of incentive payment are reduced supervision, better utilization
of equipment, reduced scrap, reduced lost time, reduced absenteeism and turnover & increased
output.
According to Burack & Smith, “An incentive scheme is a plan or programme to motivate
individual or group on performance. An incentive programme is most frequently built on
monitory rewards ( incentive pay or monetary bonus ), but may also include a variety of non-
monetary rewards or prizes.”

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Kinds of Incentives
Incentives can be classified under the following categories:
1. Individual and Organizational Incentives
2. Financial and Non-Financial Incentives
3. Positive and Negative Incentives
1) Individual and Organizational Incentives- According to L.G. Magginson, “Individual
incentives are the extra compensation paid to an individual for all production over a specified
magnitude which stems from his exercise of more than normal skill, effort or concentration when
accomplished in a predetermined way involving standard tools, facilities and materials.”
Individual performance is measured to calculate incentive where as organizational or group
incentive involve cooperation among employees, management and union and purport to
accomplish broader objectives such as an organization-wide reduction in labour, material and
supply costs, strengthening of employee loyalty to company, harmonious management and
decreased turnover and absenteeism.
I) Individual Incentive System is of two types:
a) Time based System- It includes Halsey Plan, Rowan Plan, Emerson Plan and
Bedeaux Plan
b) Production based System- it includes Taylor’s Differential Piece Rate System, Gantt’s
Task and Bonus Plan
II) Group Incentive System is of following types
a) Scalon Plan
b) Priestman’s Plan
c) Co-Partnership Plan
d) Profit Sharing
Some important these plans of incentive wage payments are as follows:
Halsey Plan- Under this plan a standard time is fixed in advance for completing a work. Bonus
is rewarded to the worker who perform his work in less than the standard time and paid wages
according to the time wage system for the saved time.
The total earnings of the worker = wages for the actual time + bonus
Bonus = 33.5% of the time saved (standard time set on past experience)
Or
50% of the time saved (standard are scientifically set)
Example: Time required to complete job (S) = 20 hours
Actual Time taken (T) = 15 hours
Hourly Rate of Pay (R) = Rs 1.5
Calculate the wage of the worker.
Solution: T X R + (S-T ) X R
2
15 X 1.5 + (20-15 ) X 1.5 = 22.5 + 3.75 = 26.25 Rs
2
In this equation 3.75 Rs are the incentives for saving 5 hours.
Rowan Plan – Under this method minimum wages are guaranteed given to worker at the
ordinary rate for the time taken to complete the work. Bonus is that proportion of the wages of
the time taken which the time saved bears to the standard time allowed.
Incentive = Wages for actual time for completing the work + Bonus where,
Bonus = S-T X T X R
S

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Emerson Plan – Under this system, wages on the time basis are guaranteed even to those
workers whose output is below the standard. The workers who prove efficient are paid a bonus.
For the purpose of determining efficiency, either the standard output per unit of time is fixed, or
the standard time for a job is determined, and efficiency is determined on the basis of a
comparison of actual performance against the standard.
Bedeaux Plan – It provide comparable standards for all workers. The value of time saved is
divided both to the worker and his supervisor in the ratio of ¾ and ¼ respectively. A supervisor
also helps a worker in saving his time so he is also given some benefit in this method. The
standard time for each job is determined in terms of minutes which are called Bedeaux points or
B’s. each B represents one minute through time and motion study. A worker is paid time wages
upto standard B’s or 100% performance. Bonus is paid when actual performance exceeds
standard performance in terms of B’s.
Taylor’s Differential Piece Rate System - F.W. Taylor, founder of the scientific management
evolved this system of wage payment. Under this system, there is no guarantee of minimum
wages. Standard time and standard work is determined on the basis of time study. The main
characteristics of this system is that two rates of wage one lower and one higher are fixed. Those
who fail in attaining the standard, are paid at a lower rate and those exceeding the standard or
just attaining the standard get higher rate. Under this system, a serve penalty is imposed on the
inefficient workers because they get the wages at lower rates. The basic idea underlying in this
scheme is to induce the worker at least to attain the standard but at the same time if a worker is
relatively less efficient, he will lose much. For example, the standard is fixed at 40 units per day
and the piece rate are 40 P. and 50 P. per unit. If a worker produces 40 units or more in a day, he
will get the wages at the rate of 50 P per unit and if he produces 39 units will get the wages at 40
paise per unit for the total output.
Gantt’s Task and Bonus Plan - In this, a minimum wage is guaranteed. Minimum wage is
given to anybody, who completes the job in standard time. If the job is completed in less time,
then there is a hike in wage-rate. This hike varies between 25% to 50% of the standard rate.
Profit Sharing – It is a method of remuneration under which an employer pay his employees a
share in form of percentage from the net profits of an enterprise, in addition to regular wages at
fixed intervals of time.
2) Financial and Non-financial Incentives- Individual or group performance can be measured
in financial terms. It means that their performance is rewarded in money or cash as it has a great
impact on motivation as a symbol of accomplishment. These incentives form visible and tangible
rewards provided in recognition of accomplishment. Financial incentives include salary,
premium, reward, dividend, income
on investment etc. On the other hand, non-financial incentives are that social and psychological
attraction which encourages people to do the work efficiently and effectively. Non-financial
incentive can be delegation of responsibility, lack of fear, worker’s participation, title or
promotion, constructive attitude, security of service, good leadership etc..
3) Positive and Negative Incentives- Positive incentives are those agreeable factors related to
work situation which prompt an individual to attain or excel the standards or objectives set for
him, whereas negative incentives are those disagreeable factors in a work situation which an
individual wants to avoid and strives to accomplish the standards required on his or her part.
Positive incentive may include expected promotion, worker’s preference, competition with
fellow workers and own ‘s record etc. Negative incentives include fear of lay off, discharge,
reduction of salary, disapproval by employer etc.

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INTERNATIONAL ORGANISATIONAL BEHAVIOUR

INTRODUCTION

International Organizational Behavior uses a global perspective to focus on business and

management interactions among individuals, groups and teams, and organizations. An
international business organization is one which expands its business activities beyond the
national border.

There are similarities and dissimilarities in certain respects between national and
international organizations. As regards dissimilarities, it is mainly cultural variations across the
nations that distinguishes organizational behaviour in international organization from national
organization. Given the varying cultural background across the nations, human behaviour at
work in them is, therefore, inevitable to vary. The same underlines the need for understanding
organizational behaviour in an international context.

INDIVIDUAL BEHAVIOUR IN INTERNATIONAL ORGANISATION:

There are a lot of differences in individual behaviour among cultures. Because organizational
culture is different from nation to nation. Following are the important points by which the
differences in individual behaviour among cultures can be proved.
Individual Differences:
No two persons are alike. Individuals differ from each other owing to their varying
characteristics that ultimately form an individual’s individuality.
Individualism/Collectivism:
Individualism is a state of mind in which a person considers his/her interest first, on a priority
basis. For e.g. US culture, Great Britain, Australia culture. Whereas collectivism refers to the
situation in which group interest comes first. For e.g. Singapore, Japanese & Indian culture.
Power Distance:
This refers to the situation in which organizational members consider the existence of different
levels of power in operation. High power distance is otherwise known as autocratic culture
where top managers make decision and subordinates follow that one. For e.g. the culture of
Pakistan, Brazil and france. Whereas low power distance reflects the situation in which
employees follow the order only when they consider it is right. For e.g. US, Australia,
Germany’s culture.
Uncertainty Avoidance:
While some individuals ready to accpt uncertainty and, in turn, risk to thrive in the challenging
and exciting situations, there are others, who simply avoid uncertainty. Employees of US and
Australia represent the two cases respectively.
Masculinity/Femininity:
Work force structure dominated by either sex has its bearing on employee behaviour at work.
India is an example of highly masculine where as Sweden that of highly feminine.
Managerial behaviour. The managerial belief vary across culture. For e.g. Japanese managers
believe that very purpose of having an organization structure is to make every employee know
his or her boss is. Whereas Indian managers believe in value based management.
Motivation:
Variation in motivation across culture also affect employee behaviour at work. In Japan security
need is very important where as Sweden emphasizes more on social need.

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GROUP BEHAVIOUR IN INTERNATIONAL ORGANISATION:

There are four key areas in which group behaviour varies. Those are given below.
Group Dynamics:
Group formation based on members belonging to diverse cultural background may create several
situations like stereotyping, communication problem etc. Therefore managers need to help the
group become cohesive and cooperative in functioning.
Leadership:
Like leadership styles, leadership roles also vary from culture to culture, Leaders in India, for
example, function only within clear confines of their legitimate powers. Where as in Japan
leaders are expected to facilitate group performance than merely act as supervisory mechanism.
Power and Conflict:
Power and conflict are more pronounced in India and Great Britain. Whereas Japan promotes
more cohesiveness.
Communication:
Communication becomes an imp aspect of interpersonal process which leads to group behaviour
in the organization. variation in language and coordination issues across culture affect
communication in the international organization.

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