Performance Management System: A Study On

A STUDY ON PERFORMANCE MANAGEMENT SYSTEM WITH REFERENCE TO HINDUSTAN AERONAUTICS LIMITED BALANAGAR, HYDERABAD
Submitted for the partial fulfillment of MASTER IN BUSINESS ADMINSTRATION

Submitted by
D. NARASIMHA RAO Roll No: 08032E0023

Under the Esteemed Guidance of
Mr. T. PRABU KUMAR Associate Professor, SMS, JNTUH
SCHOOL OF MANAGEMENT STUDIES JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERISTY HYDERABAD KUKATPALLY, HYDERABAD-500 085.
DECLARATION
I, D. NARASIMHA RAO, pursuing M.B.A (PTPG) VI Semester at School of Management Studies, Jawaharlal Nehru Technological University Hyderabad, Kukatpally, Hyderabad hereby declare that the project report titled A STUDY ON PERFORMANCE MANAGEMENT SYSTEM WITH REFERENCE TO
HINDUSTAN AERONAUTICS LIMITED submitted by me in partial fulfillment for award of Master of Business Administration is an original work.
Place: Hyderabad Date: ..
D. NARASIMHA RAO Roll No: 08032E0023 JNTUH School of Management Studies Kukatpally, Hyderabad
SCHOOL OF MANAGEMENT STUDIES JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD
CERTIFICATE
This is to certify that D. NARASIMHA RAO, Roll No. 08032E0023 is a student of SMS, JNTUH and the report titled A STUDY ON PERFORMANCE MANAGEMENT SYSTEM WITH REFERENCE TO HINDUSTAN
AERONAUTICS LIMITED done by him is an original work and is not submitted to any other university other than JNTUH.
Place: Hyderabad Date:..
CERTIFICATE
This is to certify that this is the bonafide project work entitled A STUDY ON PERFORMANCE MANAGEMENT SYSTEM WITH REFERENCE TO
HINDUSTAN AERONAUTICS LIMITED carried out by Mr. D. NARASIMHA RAO, Roll No.08032E0023 for the academic year 2008-2011 as a partial fulfillment of M.B.A. degree submitted to School of Management Studies, Jawaharlal Nehru Technological university,
Place: Hyderabad DR. A. R. ARYASRI Date: Director, SMS JNTUH
CERTIFICATE
This is to certify that Mr. D. NARASIMHA RAO, Roll No.08032E0023 is a part-time student of S M S, JNTUH and the report submitted by him entitled A STUDY ON PERFORMANCE MANAGEMENT SYSTEM AT HINDUSTAN
AERONAUTICS LTD. is his original work and is not submitted to any other university other than J N T U. This project has been carried out under my guidance.
Place: Hyderabad Date:
Mr. T. PRABU KUMAR Associate Professor- JNTUH School of Management Studies Kukatpally, Hyderabad
ACKNOWLEDGEMENT I owe a great many thanks to a great many people who helped and supported me during the Project. My deepest thanks to Mr. T. PRABU KUMAR, the Guide of the Project for guiding and correcting various documents of mine with attention and care. She has taken her valuable time to go through the project and made necessary corrections as and when needed. I express my sincere thanks to Mr. N.N. SANJAY Sr. Manager (HR) HAL for their excellent guidance in this Project. I express my thanks to Dr. ARYASRI the Director of JNTUH- School of Management Studies, for extending their support. My deep sense of gratitude to my Friends for their support and guidance. Thanks and appreciation to the helpful people who involved directly and indirectly and provided their support. And I would also thank my Institution and my faculty members without whom this project would have been a distant reality. I also extend my heartfelt thanks to my family and well wishers.
Place: Hyderabad
INDEX
CHAPTER-I Introduction: Need for the study Objectives of the study Scope of the study Research Methodology Limitations of the study CHAPTER-II Review of literature CHAPTER-III Profile of Industry CHAPTER-IV Profile of the Organization CHAPTER-V Data analysis and interpretation CHAPTER-VI Findings Suggestions & Conclusion Bibliography Appendix - I
Page No
1 to 18
19 to 40
41 to 46
47 to 71
72 to 111
112 to 116
117 to 125
CHAPTER I INTRODUCTION
1.1 INTRODUCTION Human Resource Management Human resource (or personnel) management is defined as getting things done through people. It's an essential part of every manager's responsibilities, but many organizations find it advantageous to establish a specialist division to provide an expert service dedicated to ensuring that the human resource function is performed efficiently. "People are our most valuable asset" is a clich which no member of any senior management team would disagree with. Yet, the reality for many organizations is that their people remain

under valued under trained under utilized poorly motivated, and consequently perform well below their true capability The rate of change facing organizations has never been greater and
organizations must absorb and manage change at a much faster rate than in the past. In order to implement a successful business strategy to face this challenge, organizations, large or small, must ensure that they have the right people capable of delivering the strategy. The market place for talented, skilled people is competitive and expensive. Taking on new staff can be disruptive to existing employees. Also, it takes time to develop 'cultural awareness', product/ process/ organization knowledge and experience for new staff members. As organizations vary in size, aims, functions, complexity, construction, the physical nature of their product, and appeal as employers, so do the contributions of human resource management. But, in most the ultimate aim of the function is to: "ensure that at all times the business is correctly staffed by the right number of people with the skills relevant to the business needs", that is, neither overstaffed nor understaffed in total or in respect of any one discipline or work grade. 9
Performance Management System The PM approach is used most often in the workplace but applies wherever people interactschools, churches, community meetings, sports teams, health setting, governmental agencies, and even political settings. PM principles are needed wherever in the world people interact with their environments to produce desired effects. Cultures are different but the laws of behavior are the same worldwide. Armstrong and baron (1998) defined it as A strategic and integrated approach to increasing the effectiveness of organizations by improving the performance of the people who work in them and by developing the capabilities of teams and individual contributors It is possible to get all employees to reconcile personal goals with organizational goals. One can turn around any marginal business and increase productivity and profitability for any organization, with the transparent and hidden forces embedded in this process. It can be applied by organizations or a single department or section inside an organization; as well as an individual person. The process is a natural, self-inspired performance process and is appropriately named the self-propelled performance process (SPPP). It is claimed that the self-propelled performance management system is: 1. The fastest known method for career promotion; 2. The quickest way for career advancement; 3. The surest way for career progress; 4. The best ingredient in career path planning; 5. The only true and lasting virtue for career success; 6. The most neglected part in teachings about management and leadership principles; 7. The most complete and sophisticated application of performance management; 8. The best integration of human behaviour research findings, with the latest management, leadership and organizational development principles; 9. The best automated method for organizational change, development, growth, performance and profit;
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10. The surest and fastest way for increased motivation, productivity, growth, performance and profitability for both the individual and the organization; 11. The best career builder and career booster for any career; and 12. Inspirational, as it gets people moving, makes them self-starters in utilizing own talents and initiative, automatically like magic. Performance Appraisal System in HAL The Performance Appraisal System of Officers in Grade I to X has been categorized into 5 levels. They are: Level Level I Level II Level III Level IV Level V Grades I & II III & IV V & VI VII & VIII IX & X
Salient features of the Performance Appraisal system are: Two tier system (Initiating Authority & Reviewing Authority) Quarterly task setting and evaluation on a quarterly basis. Traits based on the responsibilities associated with each level. Self-Appraisal by officers at all levels. Qualitative Assessment, Management Review Categorization & identification of training & developmental needs both by IA & RA
The Performance Appraisal comprises of Nine major parts: PART COVER PAGE PART A PART B CONTENTS Bio data of the Appraisee Quarterly Task setting and Assessment Self Appraisal TO BE FILLED BY Appraisee Appraisee & IA Appraisee
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PART C PART D PART - E PART F PART G PART H PART I
Comments on Self Appraisal & Integrity Assessment of Traits Qualitative Assessment of the Appraisee (Pen Picture) General Assessment & Management Review Categorization Training And Developmental Needs Evaluation by Performance Review Board Remarks of Higher Authorities Illustration list of Areas for Training Check List
IA & RA IA & RA IA & RA IA & RA IA & RA PRB GM/MD/FD/CH HRD Cell
Quarters for the purpose of PARs: Quarter I II III IV SCALE OF GRADATION: TOTAL MARKS Performance Rating Period 1 April to 30th June 1st July to 30th September 1st October to 31st December 1st January to 31st March
st
100-90 Exceptional
89-80 Above Average
79-50 Average
BELOW 50 Below Average
ASSESSMENT METHOD Selection of officers would be based on Marks scored in the PARs for the previous 3 years and Interview. Marks would be awarded in the Assessment as follows: Criteria Written Test Average Performance Index (API) Interview Total Minimum Qualifying Marks in the Interview Normal Promotions IMS 60% (15 out of 25) 75% (18.75 out of 25) Maximum Marks 25 50 25 100
Overall minimum qualifying marks (API + WT + Interview) 12
Normal Promotions IMS
60 out of 100 85 out of 100
GENERAL: Officers who are left with less than 1 year of service before their superannuation as on 1st July of the year of selection will not be considered generally eligible for promotions. PROCESSING & EFFECTING PROMOTIONS Promotion to Grade Effected at II & III IV, V & VI VII & VIII Divisional Level Complex Level Corporate Level
While the promotions under IMS up to and including Gr-VI will processed at the Divisional/Complex Level, approval of Corporate Office will be obtained before effecting the promotions. 1.3 Objectives of the Study: The major objectives of this study are as follows: To study and analyze the Performance Management System followed by Hindustan Aeronautics Limited. To study various Performance Management Practices. To study the Satisfaction level of the Officers working in HAL towards the Performance Management System followed in HAL To study the various factors influencing Performance Appraisal Policy in Hindustan Aeronautics Limited. To study the Promotion Policy and its effect on the satisfaction level and performance of Officers in Hindustan Aeronautics Limited.
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1.4 Methodology of the Study: Selection of the Study The topic of the study was decided in consultation with guide Smt. Bharati Arsid, Officer HR since the Performance Management is very much important in any organization. The main objective of the project is to find out the officers satisfaction towards Performance Management System followed in HAL. Hence the project is titled as Performance Management System of Officers. Source of Data: The task of data collection begins after a research problem has been defined. To start any research collection of data is required so that we get a clear picture about research, which will help to move further in the study. Method of Data Collection: There are two types of data namely Primary and Secondary Data. The Primary Data are those, which are collected afresh and for the first time and thus happen to be original in character. The secondary data are those which have already been collected by someone else and which have already been passed through the statistical process.
1.5 SCOPE OF STUDY The study is confined to Hyderabad Division for 2 months; It is confined to Officers from Grade I to Grade VI of Hindustan
Aeronautics Limited, Avionics Division. It is confined to the Officers, who appeared in the promotion written test which
was conducted in the month of May, 2011.
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1.6 Limitation of the Study: HAL is a big organization and spread over the country so I limited my study to the Avionics Division located at Balanagar, Hyderabad. Time was main constraint. Two months period will not be sufficient to conduct the study. Some of the Executives hesitated to participate as they were too busy with other important tasks. Questionnaire forms were not submitted by some of the Officers in the requested time period, this led to the slow analysis of the feedback. Only 101 respondents are covered in the study.
1.7 Presentation of the study: Present study is divided into 6 chapters. The First Chapter consists of Introduction of the study. The second chapter consists of Industry Profile and Company Profile. The Third Chapter Consists of Review of literature. The Fourth Chapter consists of the practical study - Data Analysis
and Interpretation of Recruitment and Selection activities. The Fifth Chapter consists of the relevant findings over the observations and
suggestions of the data and Conclusion. The Sixth Chapter consists of Bibliography and Annexure.
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CHAPTER II REVIEW OF LITERATURE
Performance management system: Definition: Performance management is the process of creating a work environment or setting in which people are enabled to perform to the best of their abilities. Performance management is a whole work system that begins when a job is defined as needed. It ends when an employee leaves your organization. A performance management system includes the following actions.
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Develop clear job descriptions. Select appropriate people with an appropriate selection process. Negotiate requirements and accomplishment-based performance standards, outcomes, and measures.
Provide effective orientation, education, and training. Provide on-going coaching and feedback. Conduct quarterly performance development discussions. Design effective compensation and recognition systems that reward people for their contributions.
Provide promotional/career development opportunities for staff. Assist with exit interviews to understand WHY valued employees leave the organization.
TERMINOLOGY Behavior - a manner of conducting oneself Checklist appraisals a performance appraisal formant that requires the rater to check items most representative of the employees characteristics and work contributions Comparative appraisal methods measurement of individuals against each other, resulting in a list of individuals ranked in order of performance Competency-based appraisal appraisal based on knowledge, skills, and abilities. Critical incidents reports made by knowledgeable observers of action taken by individuals who were especially effective or ineffective in accomplishing their jobs Essay appraisal a performance appraisal format that rates the employees job performance in a narrative discussion
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Graphic rating scale a format used to rate performance on a continuum of scale points Management by objectives a performance appraisal system that sets organizational goals and measures actual accomplishments against them Performance appraisal Formal, written assessment of employee work contributions and the communication that takes place with employees before, during, and after the assessment. Process by which an organization measures and evaluates an individuals behavior and accomplishments. Performance standards statement of what is considered acceptable and attainable on a particular job Traits personal characteristics or attributes of an individual that tend to be consistent PURPOSE OF PERFORMANCE APPRAISALS Major use is for pay decisions Identify candidates for promotion and reassignment Determine needs for training and development Give feedback for improvement Administer rewards and discipline Motivation tool for improved productivity Goal setting for future accomplishments and measure attainment
PERFORMANCE APPRAISAL CRITERIA Traits Traits such as leadership, judgment, initiative and dependability are positively correlated with job performance but may be difficult to measure Behaviors This criteria focuses on tasks to be performed but performance of expected criteria do not necessarily lead to success on the job if other criteria is not met Outcomes Focuses on measurable results
IMPLEMENTING PERFORMANCE APPRAISAL SYSTEMS 19
Establishing policies and procedures for consistency in rating Training raters to o Understand the key accountabilities of their jobs o Establish reasonable goals and measures of performance o Coach subordinates o Adjust expectations o Overcome common rating errors o Keep consistent performance records o Accurately and consistently appraise performance o Listen effectively o Give timely feedback o Focus on observable behaviors o Gain employees agreement in meeting acceptable standards of performance
WHY PERFORMANCE APPRAISALS FAIL Lack of objectivity Lack of job knowledge Evaluating non-job related criteria Unfocused criticism comments too general Lack of opportunity for feedback Insufficient time spent on evaluation Inconsistent standards
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PERFORMANCE APPRAISAL
TRADITIONAL METHODS
MODERN METHODS
Essay Appraisal Method Straight Ranking Method Paired Comparison Critical Incidents Methods Field Review Checklist Method Graphic Ratings Scale Forced Distribution
Management By Objectives (MBO) 360 Degree Appraisal Assessment Centres Behaviorally Anchored Rating Scale Human Resource Accounting
Content of appraisal Quantity of work Volume of work under normal working conditions
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Quality of work. Neatness, thoroughness and accuracy of work Knowledge of job. Dependability. Conscientious, thorough, reliable, accurate, with respect to attendance, relief, lunch breaks, etc. Judgment Attitude. Exhibits enthusiasm and cooperativeness on the job Cooperation. Willingness and ability to work with others to produce desired goals. Initiative.
Studying validity is studying the problem of whether or not a test measures what it purports to measure. Assessment centres have high predictive, face and content validity because of the following reasons a. Designing of ACs is based on job analysis b. Observers are extensively trained c. Candidates are graded by using ratings of competencies The construct and criterion validity of assessment centres depends on effective job analysis. If job analysis is properly done then these two validities are also found to be high. 4. HUMAN RESOURCE ACCOUNTING METHOD The American Accounting Associations Committee on Human Resource Accounting (1973) has defined Human Resource Accounting as the process of identifying and measuring data about human resources and communicating this information to interesting this information to interested parties. HRA, thus, not only involves measurement of all the costs/investments associated with the recruitment, placement, training and development of employees, but also the quantification of the economic value of the people in an organization.
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Human resources are valuable assets for every organization. Human resource accounting method tries to find the relative worth of these assets in the terms of money. In this method the Performance appraisal of the employees is judged in terms of cost and contribution of the employees. The cost of employees include all the expenses incurred on them like their compensation, recruitment and selection costs, induction and training costs etc whereas their contribution includes the total value added (in monetary terms). The difference between the cost and the contribution will be the performance of the employees. Ideally, the contribution of the employees should be greater than the cost incurred on them. HRA serves the following purposes in an organization: It furnishes cost/value information for making management decisions about acquiring, allocating, developing, and maintaining human resources in order to attain cost-effectiveness; It allows management personnel to monitor effectively the use of human resources; It provides a sound and effective basis of human asset control, that is, whether the asset is appreciated, depleted or conserved; It helps in the development of management principles by classifying the financial consequences of various practices.
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CHAPTER III INDUSTRY PROFILE
INDUSTRY PROFILE Aeronautical industry Following the rapid development of powered flight at the beginning of the 20th century aircraft manufacture, in common with many other strategic industries, was given a great stimulus during the First World War. The military potential of fixed-wing aircraft for observation and combat was proved for the first time on any scale. Nonrigid airships were used on coastal patrol and anti-submarine work and later large rigid airships, the R33 and R34, were built, based on German designs. In July 1919 the R34 was the first aircraft to cross the Atlantic from Britain to America. Regular civil aviation developed after the war, with the first daily service from London to Paris commencing in 1919. Several British companies joined to form Imperial Airways in 1924 and the network for both mail and passenger transport was
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gradually extended beyond Europe to outposts of the empire in Africa and Asia. In 1931 the company adopted the Handley Page aircraft, which could carry 40 passengers at 100 mph. From 1934 the Empire Flying Boat, nicknamed the Queen of the Skies, carrying its passengers in considerable comfort, could cruise for 800 miles at 165 mph. The British Overseas Airways Corporation (BOAC) was established 1939. The Second World War changed the face of aviation and again brought major advances in aircraft design and propulsion, particularly turbo-prop and jet engines, leading to the development of much larger and faster civilian aircraft. Post-war expansion to meet military and civil aviation requirements brought further significant innovations, but at considerable cost. One prestige project typified the white-heat of technology era of the 1960s, when Britain, in co-operation with France, operated at the limits of known technology in the race to produce a supersonic passenger transport aircraft. Concorde was developed, in spite of escalating cost and the uncertainty of its financial viability, swallowing hundreds of millions of pounds, in an exercise described by one expert as an unmitigated disaster without historical parallel. Despite an impressive performance in aero-engines and in other sectors of aerospace during the 1960s and 1970s, the commercial viability of some projects was questionable and deprived routine manufacturing of talented engineers and scientists. While remaining the third largest in the world after the USA and France, the British aerospace industry suffered badly during the periodic crises experienced by civil aviation and from reductions in defence orders. During the 1980s, collaborative development of civil and military aircraft, particularly with European partners, increased to save on costs of new production programmes. Defence offsets will quicken the pace of India's high-growth aerospace industry, says Toby Simon. From Wright Aeronautical Company to Rolls-Royce, private companies have played a part in shaping the global aerospace industry. However, the government and the aerospace sector are like Siamese twins.
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The economic scale required for development in aerospace is large, and hence the industry depends on the government for infrastructure development and R&D. This dependence carries risks, as spending is subject to the political process. Hence, it is one of the toughest markets to tap. The government hopes to turn this constraint into an advantage through the offset clause, mentioned in the Defence Procurement Procedure (DPP). It wishes to encourage private sector involvement, and is hoping to have $30 billion (about Rs 140,000 crore) generated in offset opportunities. The effective implementation of such an offset policy can facilitate the absorption and indigenization of foreign aeronautic technologies that accrue to the country by way of offset deals. In doing this, the government wishes to emulate the success of Brazil, Israel and Spain. Embraer Corporation, the Brazilian aeronautics major established in 1969, is a noteworthy success story. The company proved to be the leader in the absorption and indigenization of foreign aeronautic technologies that accrued to it by way of offset deals. In the 1960's, Embraer's first military plane, the EMB 326 Xavante trainer, was manufactured under licence from Aeromacchi, Italy. In the early 1970s, Embraer signed a technology transfer agreement with Piper of the US for manufacturing Piper Seneca light Aeroplanes. In 1975, when 49 F-5 aircraft were bought by Brazil from Northrop of the US, Embraer was involved in manufacturing several fuselage components. The 1970s and 1980s saw further growth, as Embraer embarked on a coproduction arrangement with Aeromacchi and Aeritalia to build a subsonic light attack jet fighter, the AMX. Different parts and subsystems of this aircraft, such as engine components, multi-mode radar and head-up display, were made in Brazil under licence arrangements.
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The 1990s saw the development of SIVAM, a huge monitoring, surveillance, communications and air traffic control system for Brazil's Amazon basin area. It was a $1.4-billion contract that went to Raytheon, Embraer and other Brazilian companies. The SIVAM project was a major step in technology absorption by Brazil and served to develop local software capabilities. In 1999, with 40 per cent market share, Embraer stood about equal to Bombardier. It is this example that the Indian government wants to duplicate. India already has a strong aerospace industry, and aerospace component- and defence equipment-makers have been thriving. The country has a pool of qualified engineering, science and computing graduates; availability of high-tech/precision equipment, materials and consumables; established production systems; a strong IT industry; world-class educational institutions; a good network of aeronautical development labs; favourable geographical location and manufacturing cost advantage. The aerospace industry is, therefore, set to contribute substantially to India's economic growth. Over the last 16 years, India has seen more engineering and R&D investments in aerospace than the US or Europe. In Bangalore, Honeywell Technology Solutions has set up an engineering facility with over 5,500 engineers, while GE's Jack Welch Technology Centre has an extensive research lab with over 3,000 engineers. Airbus is setting up an Airbus Engineering Center India (AECI) facility, which will hire 200-plus engineers of its own, and more than 2,000 through its partners. Indian aerospace companies are growing too. HAL was ranked 40th in Flight International's list of the top 100 aerospace companies last year. And the growth of the aerospace industry has led to the opening up of spin-off opportunities in other sectors. Offshore engineering services, for one, have seen a spurt in growth. According to a Nasscom-Booz Allen Hamilton report, there will be a $40 billion opportunity for the offshore engineering industry worldwide by 2020. India is expected
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to have a 2-3 per cent share in the aerospace offshored engineering service. This amounts to $1.2 billion by 2011. Growth in the aerospace industry has allowed a number of automobile manufacturers to exploit forward and backward linkages with the aerospace industry. India is also equipped to become a hub for maintenance, repair and overhauling (MRO). The MRO market in India was valued at $970 million in 2008, and can absorb massive investments. The government, on the advice of the Kelkar Committee, has opened up the aerospace industry to the private sector. State governments are doing their bit by setting up special economic zones (SEZs) for the aerospace industry. These include:
The Rs 3,000-crore Aerospace and Precision Engineering Special Economic Zone to be set up at Adibatla, Ranga Reddy district in Andhra Pradesh The specialised aerospace park of around 1,000 acres, proposed near the Bangalore International Airport; The 2,500-acre SEZ for the aerospace and avionics industry, proposed to be established in south Gujarat, close to the Delhi-Mumbai industrial corridor. This is likely to have a number of MRO facilities. The cumulative value of the Indian defence market for the next five years is
approximately Rs 180,000 crore (Rs 1.8 trillion), which makes it one of the most attractive in the world -especially, with the capital outlay for defence hiked this year to Rs 54,824 crore (Rs 548.24 billion), up from last year's revised estimate of Rs 41,000 crore (Rs 410 billion). HINDUSTAN AERONAUTICS LIMITED INTRODUCTION The beginning of Hindustan Aeronautics Limited can be traced to the year 1940 when a far-sighted industrialist, the late Walchand Hirachand set up a company called Hindustan Aircraft Limited in association with the Government of Mysore with the object of establishing an Aviation Industry that can manufacture, assemble and overhaul aircraft under license. The company was registered on December 23, 1940 as a 28
private limited company, with an authorised capital of Rs. 4 crore. The Production line was established in collaboration with the Inter Continental Aircraft Company of the USA for the manufacture of Harlow trainer, Curtiss Hawk fighter and Vultee attack bomber. In the year 1941 the first flight of a Harlow trainer took place followed by, the flight of India's first indigenous effort, a ten seater glider designed by Dr. V.M. Ghatage. To support the Second World War efforts the aircraft manufacturing programmes were abandoned in favour of repair and overhaul of aircraft and the company became the principal overhaul base for the South East Asia Command of the Allied forces. After World War II in December 1945 the Government of India took over the management of the Company, and activities were increased multifold after India attained its freedom. Between 1942 and 1945, a total of 1000 Aircraft and 3400 Engines were overhauled. The main activity for the next few years after the war was reconditioning and conversion of war surplus Aircraft for the use of IAF and Civil operators. In the six decades, Hindustan Aeronautics Limited has spread its wings to cover various activities in the areas of Design, Development, Manufacture and Maintenance. To become a global player in the aerospace industry Hindustan Aeronautics Limited has blossomed into a major player in the global aviation arena, and is today among the elite Navaratna companies. From what was earlier the Hindustan Aircraft Limited, founded in 1940 by the great visionary Seth Walchand Hirachand, in association with the former Princely Stat of Mysore, Hindustan Aeronautics Limited is now ranked 34th in the list of worlds top 100 Aviation Industries. The Government of India became one of the shareholders of Hindustan Aircraft Limited in March 1941 and took over the management in 1942. Hindustan Aeronautics Limited, in it present form as a Public Sector Undertaking (PSU) under the Ministry of Defence and fully owned by GoI, came into existence on October 1, 1964, when Aeronautics India Limited and Aircraft Manufacturing Depot were merged with Hindustan Aeronautics Limited. The company has 19 production divisions and 9 R&D centres. Hindustan
Aeronautics Limiteds expertise encompasses design, development, production, repair, overhaul and upgrade of aircraft, helicopters, aero engines, accessories, avionics and 29
systems. Hindustan Aeronautics Limited has also diversified into Industrial and Marine gas turbine engines, and structures for aerospace vehicles. Hindustan Aeronautics Limited is largest PSU under the Department of Defence Production, Government of India and is a Navaratna company. Hindustan Aeronautics Limited, with its wide spectrum of expertise in Design, Development and Manufacture of Aircraft, Helicopters, Engines, Accessories and Avionics has emerged as a major Aeronautical complex in Asia. All the production Divisions in Hindustan Aeronautics Limited have ISO 90012000 accreditation and ten divisions have ISO 14001-1996 Environment Management System Certification.
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ORGANISATION STRUCTURE
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HINDUSTAN AERONAUTICS LIMITED LOCATION AND BRANCHES
MANAGEMENT ACADEMY Founded in August 1969 it has become a premier executive training institute where a balanced mix of training methodology is used. Complementing this is a fullfledged faculty of experienced line Managers and Management Consultants. It also undertakes modular programs and custom made programmes. It has a well equipped Library, Auditorium and Residential facilities. AIRCRAFT DIVISION It is established in 1940. This Division has been manufacturing a variety of Aircraft. Currently the division is manufacturing the upgraded Jaguar Aircraft. The division also exports high precision sub-assemblies to renowned aircraft manufactures like Airbus and Boeing. The division is also gearing up for manufacture of HAWK Advanced Jet Trainer.
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ACCESSORIES DIVISION LUCKNOW The manufacturing range of this Division includes mechanical and hydro mechanical, fuel system and instrument accessories for the complete range of aircraft produced by Hindustan Aeronautics Limited. In addition the division also manufactures a wide variety of ground support equipment. An independent Aerospace System and Equipment R&D Centre is also attached to this Division. TRANSPORT AIRCRAFT DIVISION KANPUR Originally set up for manufacture of Avro HS-748 transport aircraft, the division today manufactures Dornier-Do -228 aircraft. The division also undertakes repair and overhaul of HS748, HPT-32, DO-228, AN-32, Canbera and Gliders as well as product updates, modification etc for transport aircraft. AVIONICS DIVISION HYDERABAD This division undertakes production and servicing of Navigation and Communication equipment, Airborne/Ground Radars and sub systems for aerospace and civil applications. Design and development activities pertaining to Communication and Radar systems are undertaken in the strategic Electronics R&D Centre, which forms a part of the Division. AVIONICS DIVISION KORWA The division manufactures and undertakes repairs and maintenance of advanced avionics systems for military aircraft covering inertial Navigation System. Head Up Display, Weapon Aiming Computers, Combined Map and Electronic Display, Laser Ranger and Marked Target Seeker as well as Solid State Flight Data Recorders. AIRCRAFT DIVISION NASIK Established as a manufacturing base for MiG series aircraft, the division has manufactured and overhauled a large number of MiG series aircraft. Currently the 33
division repairs, overhauls and upgrades, MiG 21 series, MiG 21-BIS and MiG 27. It also manufactures flexible fuel tanks, metallic drop tanks and honeycomb structures and variety of support equipment. This division has launched manufacture of Su-30 MKI Aircraft. The delivery of the Su-30 MKI from the Division is scheduled from 2004-05 onwards. An Aircraft upgrade R&D Centre also forms part of this Division. ENGINE DIVISION KORAPUT The Division undertakes the repair and overhaul of R11, R12, R29 B and RD33 engines for the MiG series aircraft. The division has excellent hot forging and precision die casting facilities for both ferrous and non-ferrous alloys. A separate Division has been formed for the license manufacturing activities of AL-31FP engines for Su-30 MKI. A Gas Turbine R&D Centre in the Division provides design and liaison support to manufacturing and overhaul activities. STRATEGIES

To be in total alignment with Corporate Strategy Maintain Human Resource at optimum level to meet the objectives and goals of the Company Be competent in Mapping, Analysis and Upgradation of Knowledge and Skills including Training, Re-training, Multi-skilling etc. Cultivate Leadership with Shared Vision at various levels in the Organization Focus on Development of Core Competence in High-Tech areas Build Cross-functional Teams Create awareness of Mission, Values and Organizational Goals through out the Company Introduce / Implement personnel policies based on performance that would ensure growth, Rewards, Recognition, Motivation
VISION "To make HAL a dynamic, vibrant, value-based learning organisation with human resources exceptionally skilled, highly motivated and committed to meet the current and future challenges. This will be driven by core values of the Company fully embedded in the culture of the Organisation" 34
MISSION To become a globally competitive Aerospace Industry while working as an instrument for achieving self-reliance in Design, Manufacture and Maintenance of Aerospace Defence equipment and diversifying to related areas, managing the business on commercial lines in a climate of growing professional competence. TRUST AND TEAM SPIRIT We believe in achieving harmony in work-life through mutual trust, transparency, co-operation, and a sense of belonging. We will strive for building empowered teams to work towards achieving organizational goals. RESPECT FOR THE INDIVIDUAL We value our people. We will treat each other with dignity and respect and strive for individual growth and realization of everyone's full potential. INTEGRITY We believe in a commitment to be honest, trustworthy, and fair in all our dealings. We commit to be loyal and devoted to our organization. We will practice self discipline and own responsibility for our actions. We will comply with all requirements so as to ensure that our organization is always worthy of trust.
PRODUCT PROFILE
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Aircraft designed and developed by Hindustan Aeronautics Limited HT-2 Piston-engined trainer Pushpak Light aircraft for flying clubs Krishak Air Observation Post Marut(HF-24) Ground Attack Jet Fighter Marut Trainer Operational Trainer Kiran Mk.I and IA and II Basic Jet Trainer Basant Agricultural Aircraft Ajeet Light Fighter HPT-32 Piston-engined Trainer HTT-34 Turboprop Variant Aircraft produced under license at Hindustan Aeronautics Limited Percival Prentice Trainer Vampire Fighter-Bomber Gnat Intercepter Mig-21 FL Intercepter Mig-21 bis Ground Attack Jaguar Multi-role Fighter Mig-27 Ground Attack Avro(HS-748) Medium Transport Dornier-228 Light Transport Chetak Utility Helicopter Cheetah R and O
CUSTOMERS PROFILE Established initially to cater to Indian Air Force, today the list of their esteemed and satisfied customers includes: Indian Air Force Indian Army Indian Navy Coast Guard
36
Civil Aviation Sector Indian Space Research Organisation Defence Research & Development Organisations Centre for Airborne Systems Ship Building Industries GRSE, MDL, GSL, HSL Public Sector Undertakings State Police Departments Other Sister Divisions of Hindustan Aeronautics Limited
37
ORGANISATION GROWTH OF HAL

2002 Expansion of Nasik Division as Aircraft Manufacturing Division and Aircraft Overhaul Division Establishment of Sukhoi Engine Division at Koraput
2000
Establishment of Airport Service Centre for coordinating the operations at HAL Airport, Bangalore Establishment of Industrail & Marine Gas Turbine Division for coordinative gas turbines/Industrial engines Establishment of Aero Space Division for Structure of Aerospace Launch Vehicles Establishment of Korwa Division for Advanced Avionics Establishment of Foundry & Forge Division At, Bangalore Establishment of Helicopter Division at, Bangalore Establishment of Lucknow Division for Accessories & Instruments
1998
1988
1982
1974
1970
1964 1962
Formation of Hindustan Aeronautics Limited By Merger of 3 Companies Establishment of Aeronautics India Limited At Nasik, Koraput & Hyderabd for MiG Airframe, Denines & Avionics Establishment of Aircraft Manufacturing Depot At Kanpur for HS-748 Establishment of Engine Division At Bangalore
1960
1940
Hindustan Aircraft Limited at Bangalore
38
FINANCIAL HIGHLIGHTS: Hindustan Aeronautics Limited (HAL) has cruised past the Rs.7,500-crore mark for the first time with a sales turnover of Rs.7,783.61 crores ($1.82 billion) during the Financial Year 2006-07, The Value of Production has also gone up by 55.54% to Rs. 9,201.88 crores, while the Profit of the Company (Profit Before Tax) soared to Rs.1,743.60 crores, which is an increase of 54.88% over the previous year's performance. The highlights are given below:
Rupees in Crores Growth over Previous Particulars Sales VOP Profit before tax Profit after tax Gross Block 2005-06 5342 5916 1126 771 1694 2006-07 7783 9202 1744 1149 2081 Year 45.69% 55.54% 54.88% 49.03% 22.85%
Awards: 39
The
Avionics
Division,
Hyderabad
has
been
accredited
with
ISO-9001
CERTIFICATION and accomplished the following milestone.
First prize in the field of Strategic Electronics during 1991 from Department of Electronics, Govt. of India.
National Award for R&D in Electronics from DSIR, Ministry of Science and Technology.
ISO 9001 Certification for design, development, production and servicing. Qualification approval for Printed Circuit Boards from LCSO. Accreditation by National Accreditation board for test and calibration laboratories.
Qualification approval for the hybrid manufacturing for the Aerospace application.
Fitment of indigenously developed avionics on all the aircraft acquired by Indian Defence Services.
Services: Retro - modification HAL has developed a specialised 'Flight Test Group' with expertise in trial installation of Avionic systems on Fixed and Rotary wings of Combat and Transport Aircraft. This group has achieved success in installing its latest Avionic systems on MiG-21 series, MiG-23, MiG-27M, MiG-29, IL-38, Su-30 MKI, HS 748, and TU-142 series of aircraft and also on helicopters like MI - 8, MI - 25, Seaking, Chetak and Cheetah. It has exhibited complete self-sufficiency for conducting feasibility studies, manufacturing of Mod Kits, Installation and Flight Testing of Avionic systems.
Repair and Overhaul 40
HAL has excellent facilities and procedures for defect investigation, repair and overhaul of Russian, Western and indigenous air-borne equipment. Our Engineers have vast experience in all these systems and they also carry out field repairs. The principle of Inspect and Repair as Necessary (IRAN) is followed, which means that the equipment need not be sent for regular / periodic overhaul. The repair facilities are available from first generation to fourth generation equipment with frequencies from DC to 40 GHz.
41
CHAPTER V DATA ANALYSIS & INTERPRETATION
42
1. Since how long have you been working in HAL?
ATTRIBUTES For the past 0-2 years For the past 2-5 years For the past 5-10 years For the past 11 years & above Total
NO. OF RESPONDENTS 2 43 22 34 101
% OF RESPONDANTS 1.98 42.57 21.78 33.66 100
Interpretation: The above table shows that 1.98% i.e., 2 respondents have been working for the past 0-2 years, 42.57% i.e., 43 respondents have been working for the past 2-5 years, 21.78% i.e., 22 respondents have been working for the past 5-10 years, 33.66% i.e., 34 respondents have been working for the past 11 years & above in the organization.
43
NO. OF RESPONDENTS
2% for the past 0-2 years 34% for the past 2-5 years 42% for the past 5-10 years for the past 11 years & above 22%
2. The System of PAR which is followed in HAL
ATTRIBUTES Highly Satisfied Satisfied Dissatisfied Highly Dissatisfied Total Interpretation:
% OF RESPONDANTS 3.96 76.24 15.84 3.96 100.00
The above table shows that 76.24% i.e., 77 respondents are satisfied with the system of PAR, 15.84% i.e., 16 respondents are dissatisfied with the system of PAR,
44
3.96% i.e., 4 respondents are highly satisfied and 3.96% i.e., 4 respondents are highly dissatisfied with the system of PAR followed in HAL. 80.20% of the Officers are satisfied with the system of PAR which is followed in HAL.
4% 4% 16% Highly Satisfied Satisfied Dissatisfied Highly Dissatisfied
76%
3. Evaluation of Officers' performance on quarterly basis
ATTRIBUTES Excellent Very Good Good Average Total Interpretation:
% OF RESPONDANTS 8.91 29.70 44.55 16.83 100
The above table shows that 44.55% i.e., 45 respondents says that evaluation of the Officers performance on quarterly basis is good.
45
29.70% i.e., 30 respondents says it is very good, 16.83% i.e., 17 respondents says it is average and only 8.91% i.e., 9 respondents says that evaluation of Officers performance on quarterly basis is excellent. On an average it is evident from the analysis that (8.91%+29.70%+44.55%) 83.16% of Officers agree that the system of quarterly evaluation is good.
17%
9%
Excellent 30% Very Good Good Average 44%
4. The Scale of gradation which is followed in HAL for PAR
ATTRIBUTES Highly Satisfied Satisfied Dissatisfied Highly Dissatisfied Total Interpretation:
% OF RESPONDANTS 5.94 75.25 13.86 4.95 100.00
The above table shows that 75.25% i.e., 76 respondents are satisfied with the scale of gradation followed in the organization.
46
13.86% i.e., 14 respondents are dissatisfied, 5.94% i.e., 6 respondents are highly satisfied and 4.95% i.e., 5 respondents are highly dissatisfied with the scale of gradation followed in the organization. Scale of Gradation needs no changes as 75% of Officers are satisfied.
5% 14%
6%
Highly Satisfied Satisfied Dissatisfied Highly Dissatisfied
75%
5. Devotion of 40% of marks in quarterly task sheets for improvement task
% OF RESPONDANTS 13.86 16.83 41.58 27.72 100
The above table shows that 41.58% i.e., 42 respondents says that the policy of devoting of 40% marks in quarterly task sheets for improvement task is good.
47
27.72% i.e., 28 respondents says it is average, 16.83% i.e., 17 respondents says it is very good. And very less percentage of 13.86 i.e., 14 respondents says the policy of devoting of 40% marks in quarterly task sheets for improvement task is excellent. Defining improvement task for each quarter may be very difficult. Further the marks assigned to improvement task can be reduced.
14% 28% Excellent 17% Very Good Good Average
41%
6. Receiving of feedback on your performance by your boss
ATTRIBUTES Highly Satisfied Satisfied Dissatisfied Highly Dissatisfied No Answer Total Interpretation:
NO. OF RESPONDENTS 17 62 16 5 1 101
% OF RESPONDANTS 16.83 61.39 15.84 4.95 0.99 100.00
The above table shows that 61.39% i.e., 62 respondents are satisfied to receive feedback on their performance by their boss.
48
16.83% i.e., 17 respondents are highly satisfied, 15.84% i.e., 16 respondents are dissatisfied, 4.95% i.e., 5 respondents are highly dissatisfied, 0.99% i.e., 1 respondent did not give answer. From the above table it can be known that most of the respondents are satisfied with receiving feedback on their performance by their boss.
1% 5% 16% Highly Satisfied Satisfied Dissatisfied Highly Dissatisfied No Answer 61% 17%
7. The present system of PAR is too-time consuming ATTRIBUTES Strongly Agree Agree Disagree Strongly Disagree Total Interpretation: The above table shows that 42.57% i.e., 43 respondents are disagreeing that the present system of PAR is too time consuming. NO. OF RESPONDENTS 10 41 43 7 101 % OF RESPONDANTS 9.90 40.59 42.57 6.93 100.00
49
40.59% i.e., 41 respondents are agreeing that the present system of PAR is too time consuming, 9.9% i.e., 10 respondents are strongly agreeing that the present system of PAR is too time consuming. And only 6.93% i.e., 7 respondents are strongly disagreeing that the present system of PAR is too time consuming. This is a contradictory situation that 50% of Officers agree that PAR system is too-time consuming and other 50% disagree with this statement.
7%
10%
Strongly Agree Agree 42% Disagree 41% Strongly Disagree
8. Ratings are sometimes seen as based on subjective judgment
ATTRIBUTES Strongly Agree Agree Disagree Strongly Disagree Total Interpretation:
% OF RESPONDANTS 10.89 70.30 17.82 0.99 100.00
50
The above table reveals that 70.3% i.e., 71 respondents agree that the ratings are sometimes seen as based on subjective judgement, the respondents mostly belongs to SLRDC, QC, HR and Communication Departments. 17.82% i.e., 78 respondents disagree that the ratings are sometimes based on subjective judgement, 10.89% i.e., 11 respondents strongly agree. And 0.99% i.e., only 1 respondent out of total sample strongly disagree that the ratings are sometimes seen as based on subjective judgement. 80% of the Officers are agreeing with the fact that the ratings are based on subjective judgment.
1% 18%
11%
Strongly Agree Agree Disagree Strongly Disagree
70%
9. Training is given subsequently as recommended in PAR
% OF RESPONDANTS 6.93 33.66 37.62 21.78 100.00
51
The above table shows that 37.62% i.e., 38 respondents disagree that the training is given subsequently as recommended in PAR. 33.66% i.e., 34 respondents agree that the training is given subsequently as recommended in PAR, 21.78% i.e., 22 respondents strongly disagree that the training is given subsequently as recommended in PAR. And only 6.93% i.e., 7 respondents strongly agree that the training is given subsequently as recommended in PAR. As 60% disagree with the statement so steps can be taken to ensure that the training recommended in PAR is given to the Officers and more training programs are to be organized.
7% 22% Strongly Agree 34% Agree Disagree Strongly Disagree 37%
10. Replacing present PAR system with online PAR system
ATTRIBUTES Strongly Agree Agree Disagree Strongly Disagree No answer
% OF RESPONDANTS 27.72 53.47 12.87 4.95 0.99
52
Total Interpretation:
101
100.00
The above table shows that the 53.47% i.e., 54 respondents agree with the replacing of present PAR system with online PAR system and most of them belong to SLRDC, QC, Purchase and Communication departments. 27.72% i.e., 28 respondents strongly agree with it and 12.87% i.e., 13 respondents disagree with the above statement. 4.95% i.e., 5 respondents strongly disagree with the above statement and one respondent did not give the answer as he is not aware of what is online PAR system. 81% of the Officers agree that present PAR system should be replaced with online PAR system.
1% 5% 13% 28% Strongly Agree Agree Disagree Strongly Disagree No answer 53%
11. Quarterly task setting & evaluation are done as per schedule
ATTRIBUTES Strongly Agree Agree Disagree
NO. OF RESPONDENTS 5 57 30
% OF RESPONDANTS 4.95 56.44 29.70
53
Strongly Disagree Total Interpretation:
9 101
8.91 100.00
The above table reveals that the 56.44% i.e., 57 respondents agree that the quarterly task setting & evaluation are done as per the schedule. 29.7% i.e., 30 respondents disagree, 8.91% i.e., 9 respondents strongly disagree and only 4.95% i.e., 5 respondents strongly agree that the quarterly task setting and evaluation are done as per the schedule.
9%
5%
Strongly Agree 30% Agree Disagree 56% Strongly Disagree
12. Subordinates are rated based upon his/her performance
ATTRIBUTES Strongly Agree Agree Disagree Strongly Disagree Total
% OF RESPONDANTS 15.84 68.32 12.87 2.97 100.00
54
Interpretation: The above table reveals that the 68.32% i.e., 69 respondents agree that the Subordinates are rated based upon his/her performance. 15.84% i.e., 16 respondents strongly agree, 12.87% i.e., 13 respondents disagree and only 2.97% i.e., 3 respondents strongly disagree that the subordinates are rated based upon his/her performance. 83% of Officers agreeing that the subordinates are rated based upon his/her performance on the other hand 80% of the Officers are agreeing with the fact that the ratings are based on subjective judgment these two sentence are contradictory.
13%
3%
16%
68%
13. Self-appraisal is taken into consideration while performance is appraised
ATTRIBUTES Strongly Agree Agree Disagree Strongly Disagree No answer Total
NO. OF RESPONDENTS 8 71 19 2 1 101
% OF RESPONDANTS 7.92 70.30 18.81 1.98 0.99 100.00
55
Interpretation: The above table reveals that the 70.30% i.e., 71 respondents agree that the selfappraisal is taken into consideration while performance is appraised and most of them belong to Communication, HR, IT, MSD, Purchase, QC and SLRDC departments. 18.81% i.e., 19 respondents disagree, 7.92% i.e., 8 respondents strongly agree, 1.98% i.e., 2 respondents strongly disagree that the self-appraisal is taken into consideration while performance is appraised and one respondent did not respond to the above statement.
1% 2% 19% Strongly Agree Agree Disagree Strongly Disagree No answer 70% 8%
14. Your IA appraises you about your performance while evaluating the quarterly task sheets & PAR
ATTRIBUTES Strongly Agree Agree Disagree Strongly Disagree Total
% OF RESPONDANTS 12.87 66.34 18.81 1.98 100.00
56
Interpretation: The above table reveals that 66.34% i.e., 67 respondents agree that their IA appraises their performance while evaluating the quarterly task sheets & PAR, 18.81% i.e., 19 respondents disagree with it, 12.87% i.e., 13 respondents strongly agree with it. Only 1.98% i.e., 2 respondents out of the whole sample strongly disagree that their IA appraises them about their performance while evaluating the quarterly task sheets & PAR.
2% 19%
13%
66%
15. You are fully aware about the PAR system being followed in HAL
% OF RESPONDANTS 20.79 70.30 7.92 0.99 100.00
57
The above table shows that 70.30% i.e., 71 respondents agree that they are fully aware about the PAR system being followed in HAL, 20.79% respondents strongly agree that they are fully aware about the PAR system being followed in HAL. 7.92% i.e., 8 respondents disagree that they are full aware about the PAR system followed in HAL and only 0.99% i.e., 1 respondent strongly disagree that he/she is fully aware about the PAR system being followed in HAL.
8%
1% 21% Strongly Agree Agree Disagree Strongly Disagree
70%
16. Your relation with your boss
% OF RESPONDANTS 21.78 48.51 24.75 4.95 100
The above table shows that 48.51% i.e., 49 respondents says their relation with the boss is very good, 24.75% i.e., 25 respondents says it is good.
58
21.78% i.e., 22 respondents says that their relation with the boss is excellent and only 4.95% i.e., 5 respondents says that their relation with the boss is average. 95% of the officers are having very good relations with the boss.
5% 22% 25% Excellent Very Good Good Average
48%
17. Your relation with your subordinate
% OF RESPONDANTS 29.70 53.47 16.83 0.00 100
The above table shows that 53.47% i.e., 54 respondents says that their relation with the subordinates is very good. 29.70% i.e., 30 respondents says that it is excellent and 16.83% i.e., 17 respondents says that the relation with the subordinates is good.
59
It was very much interesting to know that 100% of the Officers said that their relations with their subordinates are good.
17%
0% 30% Excellent Very Good Good Average
53%
18. Boss encourages you to approach him frequently for his advice and help
% OF RESPONDANTS 28.71 62.38 5.94 2.97 100.00
The above table shows that 62.38% i.e., 63 respondents agree that their boss encourages them to approach him frequently for his advice and help, 28.71% i.e., 29 respondents strongly agree with it. 5.94% i.e., 6 respondents disagree with it and 2.97% i.e., 3 respondents strongly disagree that their boss encourages them to approach him frequently for his advice and help.
60
6% 3% 29% Strongly Agree Agree Disagree Strongly Disagree 62%
19.. You are helping your subordinates to become aware of some of their own strengths
% OF RESPONDANTS 32.67 64.36 0.99 1.98 100.00
The above table reveals 64.36% i.e., 65 respondents agree that they are helping their subordinates to become aware of some of their own strengths, 32.67% i.e., 33 respondents strongly agree with it, 1.98% i.e., 2 respondents strongly disagree with the above statement. And 0.99% i.e., 1 respondent out of the whole sample disagree with that he/she is helping subordinates to become aware of some of their own strengths.
61
2% 1% 33% Strongly Agree Agree Disagree Strongly Disagree 64%
20. You clearly prescribe standards of behavior to be followed in your work unit
% OF RESPONDANTS 22.77 66.34 9.90 0.99 100.00
The above table shows 66.34% i.e., 67 respondents agree, 22.77% i.e., 23 respondents strongly agree, 9.9% i.e., 10 respondents disagree that they clearly prescribe standards of behaviour to be followed in their work unit. And only 0.99% i.e., 1 respondent says he / she strongly disagree that he/she clearly prescribes standards of behaviour to be followed in work unit. 89.11% of the Officers are agreeing that they clearly prescribe standards of behaviour to be followed in their work unit.
62
10%
1% 23% Strongly Agree Agree Disagree Strongly Disagree
66%
63
Crosstabs Designation * 4.Scale of gradation H0: There is no significance difference between designation and their opinions on scale of gradation is followed in HAL for PAR Crosstab 4.Scale of gradation Highly Highly Satisfied Satisfied Dissatisf Dissatisf ied ied 0 23 2 1 0.0% 1 2.4% 0 0.0% 1 0.9% 88.5% 32 78.0% 34 85.0% 89 83.2% 7.7% 8 19.5% 4 10.0% 14 13.1% 3.8% 0 0.0% 2 5.0% 3 2.8% Total
Count Engineer % within Designation Count Designation Manager % within Designation Count Officer % within Designation Count Total % within Designation
26 100.0% 41 100.0% 40 100.0% 107 100.0%
Chi-Square Tests Value df
Pearson Chi-Square 5.944a Likelihood Ratio 7.217 N of Valid Cases 107 a. 7 cells (58.3%) have expected count less than 5. The minimum expected count is .24.
Asymp. Sig. (2sided) 6 .429 6 .301
From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on scale of gradation is followed in HAL for PAR
64
Designation * 7.System of PAR H0: There is no significance difference between designation and their opinions on the present system of PAR is too-time consuming
Crosstab 7.System of PAR Strongly Agree Disagree Strongly Agree Disagree 3 14 7 2 11.5% 4 9.8% 0 0.0% 7 6.5% 53.8% 31 75.6% 29 72.5% 74 69.2% 26.9% 6 14.6% 11 27.5% 24 22.4% 7.7% 0 0.0% 0 0.0% 2 1.9% Total
26 100.0% 41 100.0% 40 100.0% 107 100.0%
Asymp. Sig. (2sided) 6 .036 6 .017
From the above table chi square is significant (sig. value is less than 0.05), reject null hypothesis. It means that there is a significance difference between designation and their opinions on the present system of PAR is too-time consuming
65
Designation * 8.Ratings H0: There is no significance difference between designation and their opinions on ratings based on subjective judgment
Crosstab Strongly Agree 4 15.4% 3 7.3% 2 5.0% 9 8.4% 8.Ratings Agree Disagree Strongly Disagree 21 1 0 80.8% 36 87.8% 36 90.0% 93 86.9% 3.8% 1 2.4% 2 5.0% 4 3.7% 0.0% 1 2.4% 0 0.0% 1 0.9% Total
26 100.0% 41 100.0% 40 100.0% 107 100.0%
Asymp. Sig. (2sided) 6 .644 6 .628
From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on ratings based on subjective judgment
66
Designation * 12.Quarterly task setting H0: There is no significance difference between designation and their opinions on quarterly task setting and evaluation are done as per schedule Crosstab 12.Quarterly task setting Strongly Agree Disagree Strongly Agree Disagree 3 14 9 0 11.5% 2 4.9% 3 7.5% 8 7.5% 53.8% 16 39.0% 30 75.0% 60 56.1% 34.6% 21 51.2% 6 15.0% 36 33.6% 0.0% 2 4.9% 1 2.5% 3 2.8% Total
Count Engineer % within Designation Count Designation Manager % within Designation Count % within Officer Designation Count Total % within Designation
26 100.0% 41 100.0% 40 100.0% 107 100.0%
Asymp. Sig. (2sided) 6 .021 6 .013
From the above table chi square is significant (sig. value is less than 0.05), reject null hypothesis. It means that there is a significance difference between designation and their opinions on quarterly task setting and evaluation are done as per schedule
67
Designation * 15.IA Appraises H0: There is no significance difference between designation and their opinions on IA appraises performance evaluating quarterly task sheets and PAR
Crosstab Strongly Agree 0 0.0% 3 7.3% 2 5.0% 5 4.7% 15.IA Appraises Agree Disagree Strongly Disagree 22 3 1 84.6% 27 65.9% 32 80.0% 81 75.7% 11.5% 8 19.5% 2 5.0% 13 12.1% 3.8% 3 7.3% 4 10.0% 8 7.5% Total
Count Engineer % within Designation Count Designatio Manager % within n Designation Count Officer % within Designation Count Total % within Designation
26 100.0% 41 100.0% 40 100.0% 107 100.0%
Pearson Chi-Square 7.054a Likelihood Ratio 8.456 N of Valid Cases 107 a. 9 cells (75.0%) have expected count less than 5. The minimum expected count is 1.21.
Asymp. Sig. (2sided) 6 .316 6 .207
From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on IA appraises performance evaluating quarterly task sheets and PAR
68
Designation * 18.Relation with subordinate H0: There is no significance difference between designation and their opinions on relation with subordinate
Crosstab 18.Relation with subordinate Excellent Very Good Average Good 5 10 11 0 19.2% 5 12.2% 4 10.0% 14 13.1% 38.5% 27 65.9% 22 55.0% 59 55.1% 42.3% 9 22.0% 13 32.5% 33 30.8% 0.0% 0 0.0% 1 2.5% 1 0.9%
Total
26 100.0% 41 100.0% 40 100.0% 107 100.0%
Asymp. Sig. (2sided) 6 .312 6 .283
From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on relation with subordinate
69
Designation * 19.Boss encourages H0: There is no significance difference between designation and their opinions on boss encouragement
Crosstab 19.Boss encouragement Strongly Agree Disagree Strongly Agree Disagree 6 18 1 1 23.1% 6 14.6% 3 7.5% 15 14.0% 69.2% 26 63.4% 35 87.5% 79 73.8% 3.8% 8 19.5% 2 5.0% 11 10.3% 3.8% 1 2.4% 0 0.0% 2 1.9% Total
26 100.0% 41 100.0% 40 100.0% 107 100.0%
Asymp. Sig. (2sided) 6 .079 6 .067
From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on boss encouragement
70
Designation * 22.Instructions to subordinate H0: There is no significance difference between designation and their opinions on give clear instructions to subordinate
Crosstab 22.Instructions to subordinate Strongly Agree Disagree Strongly Agree Disagree 5 20 0 1 19.2% 19 46.3% 17 42.5% 41 38.3% 76.9% 20 48.8% 23 57.5% 63 58.9% 0.0% 2 4.9% 0 0.0% 2 1.9% 3.8% 0 0.0% 0 0.0% 1 0.9%
Total
26 100.0% 41 100.0% 40 100.0% 107 100.0%
Asymp. Sig. (2sided) 6 .066 6 .050
From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on give clear instructions to subordinate
Regression 71
Model Summary Model R R Square Adjusted R Std. Error of the Square Estimate a 1 .398 .158 .134 .633 a. Predictors: (Constant), 21.Behaviour in work unit, 12.Quarterly task setting, 18.Relation with subordinate ANOVAa Model Sum of Squares df Mean Square F Sig. Regression 7.739 3 2.580 6.444 .000b 1 Residual 41.233 103 .400 Total 48.972 106 a. Dependent Variable: 3.Evaluation of officers b. Predictors: (Constant), 21.Behaviour in work unit, 12.Quarterly task setting, 18.Relation with subordinate Coefficientsa Model Unstandardized Coefficients B 1.558 Std. Error .308 .096 .095 .104 Standardized Coefficients Beta 5.066 .272 .235 .043 2.935 2.525 .457 .000 .004 .013 .649 t Sig.
(Constant) 12.Quarterly task .283 setting 1 18.Relation with .241 subordinate 21Standards followed .047 in work unit a. Dependent Variable: 3.EvaluatSion of officers
The required regression line is Evaluation of officers performance =1.558+0.283(Quarterly task setting) + 0.241(Relation with subordinate) + 0.047(Standards followed in work unit)
CHAPTER VI DISCUSSIONS & CONCLUSIONS

DISCUSSIONS:
72
It is observed that most of the Officers are satisfied with the system of PARs which is followed in HAL.
Most of the Officers agree that the system of evaluation of Officers performance on quarterly basis is good.
The scale of gradation followed in HAL is satisfied by most of the Officers. So, it requires no changes.
Defining improvement task for each quarter may be very difficult. Further the marks assigned to improvement task can be reduced.
Officers are satisfied to receive the feed back by their boss. The Officers are equally agreed and disagree that the present PAR system is too time consuming, this is a contradictory situation.
Most of the Officers are agreeing with the fact that the ratings are some times based on subjective judgement.
60% of the Officers are disagreeing with the statement that the training is given subsequently as recommended in PAR.
It is observed that more than 80% of the officers agree that the present PAR system should be replaced with online PAR system.
More than 50% Officers agreed that the Quarterly task setting & evaluation are done as per schedule.
Most of the Officers are agreeing that the subordinates are rated based upon his/her performance on the other hand Officers said that the ratings are based on subjective judgement. These two sentences are contradictory.
73
Self-appraisal is taken into consideration while performance is appraised. Most of the Officers said that their IA appraises their performance while evaluating the quarterly task & PAR.
95% of the officers are having very good relations with their boss and 100% of the Officers are having very good relations with their subordinates.
Almost all the Officers are fully aware of PAR system followed in HAL. Most of the Officers said that their boss encourages them to approach him frequently for advice and help.
Most of the Officers said that they help their subordinates to become aware of some of their own strengths.
Most of the officers said that they give clear instruction to their subordinates that what should and what should not be done.
More than 50% agree that they do not hesitate to criticize their subordinates for their bad performance even if they feel offended and do not accept their feed back.
It is found that the Officers are learning new things and they are improving their skills in their present discipline.
Bosses are concerned about their subordinates and are communicating feedback to their subordinates on their performance.
Most of the Officers said that re-introduction of IMS scheme motivated them to excel in their work area.
74
It is observed that the policy of conducting written test, service eligibility for next grade and deferring of promotion on bases of LWP require no change.
Most of the Officers agree that there should be job rotation on promotion. It is observed that the procedure followed for the promotion of Officers is not satisfactory one of the reasons could be delay in processing of promotions.
The present PAR system can be replaced with 360 degrees PAR system as the 360 degree system gives the correct picture above the Officer and PAR system should be made Online.
Feed back should be given to the Officers on their performance whether it is good or bad so that they can improve themselves.
The marks assigned for the improvement task can be reduced. Steps should be taken to ensure that the training recommended in PAR is given to the officers and more training programmes are organized.
It should be ensured that the Promotion processes are carried out as per schedule so that Promotion Orders are issued in time.
The Question Banks which were used for various disciplines in the online written test should be revised and made more relevant to the disciplines.
After taking a hard look at the performance management system at Hindustan Aeronautics Ltd, what I have experienced is that the working conditions are very good.
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There is good friendly relation prevailing between the employees. Even the subordinates respect the top management. But what I have noticed is that there is a lack of job satisfaction among the employees. I would like to give few suggestions, through which, I guess the organization can improve its standard. 1. The management should give its employees more challenging work. 2. The organization can conduct the appraisal of their employees performance twice in a year instead of doing it once in a year. 3. The management should give regular feedback of the employees performance. So that the employees can have the idea of how they are performing. 4. The organization can go for 360 degrees appraisal method, which I think will be the most effective than the method they are using at the moment.
CONCLUSION
The study is done to know the satisfaction level of employees performance on their present job. Performance appraisal is the evaluation of employees performance at
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his present job and also process by which the employees strengths and weakness are identified to improve the performance on the present jobs. The basic purpose of performance appraisal is to know how well the employee is performing on the job, and to establish a plan for their improvement. To find out this, I have made a detailed study at Hindustan Aeronautics limited, Balanagar where the performance appraisal system is easy to understand. In the organization the top management provides awards and rewards to the part of performance appraisal system in sales department. The employees who are reached their highest target regarding sales, those persons will get awards and rewards. In Hindustan Aeronautics Limited, Balanagar the frequency of the system can also be increased, where the confidentiality must be strictly maintained, and rating should be made without any bias-recognition at par with the employees performance can be made and the participation of the top management can make the performance appraisal system more effective. This performance appraisal gives a clear idea about good relation between top management and employees. Thus the appraisal system in Hindustan Aeronautics Limited, Balanagar maintained very effectively. The outcomes also has given efficiently. However the above study has been successfully understanding and highlighting performance appraisal system in the organization.
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BIBLIOGRAPHY
1. P. Subba Rao, Essentials of Human Resource Management And Industrial Relations, 3rd Edition, Himalaya Publishing House. 2. K. Aswathappa, Human Resource And Personnel Management, 3rd Edition, Tata McGraw Hill. 78
3. C.R.Kothari (1990), Research Methodology Methods and Techniques, Second edition New Age International Publishers, New Delhi. 4. Human Capital Journal. Websites: 1. www.hal-india.com 2. www.google.com 3. www.citehr.com 4. www.managementparadise.com 5. www.citeops.com
As a part of my MBA Curriculum, I am doing this project titled A Study on Performance Management System of Officers at HAL, Hyderabad. To do my project successfully I need your cooperation by way of filling this questionnaire for
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which I will be very thankful to you. I assure you that this is purely for academic purpose and your responses will be kept confidential. EMPLOYEE DETAILS: Name Age Department Designation Q1. : : : :
Since how long have you been working for HAL? (a) for past 0-2 years (c) for past 5-10 years (b) for past 2-5 years (d) for past 11 years & above [ ]
Q2.
The system of PAR which is followed in HAL (a) Highly satisfied (c) Dissatisfied (b) Satisfied (d) Highly dissatisfied [ ]
Q3.
Evaluation of officers performance on quarterly basis (a) Excellent (c) Good (b) Very Good (d) Average [ ]
Q4.
The scale of gradation which is followed in HAL for PAR (a) Highly satisfied (c) Dissatisfied (b) Satisfied (d) Highly dissatisfied [ ]
Q5.
Devotion of 40% of marks in quarterly task sheets for improvement task (a) Excellent (c) Good (b) Very Good (d) Average [ ]
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Q6.
Receiving of feedback on your performance by your boss (a) Highly satisfied (c) Dissatisfied (b) Satisfied (d) Highly dissatisfied [ ]
Q7.
The present system of PAR is too-time consuming (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q8.
Ratings are sometimes seen as based on subjective judgement (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q9.
Training is given subsequently as recommended in PAR (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q10.
Replacing present PAR system with online PAR system (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q11.
If your boss brings out while giving feedback that your performance is not up to the mark then how would you react? (Tick as many as possible) (a) Take feedback positively. (b) Try to improve on shortcomings. (c) Try to convince boss that he has not done assessment correctly. (d) Take feedback negatively. [ ]
Q12.
Quarterly task setting & evaluation are done as per schedule 81
(a) Strongly agree (c) Disagree Q13.
(b) Agree (d) Strongly disagree [ ]
Subordinates are rated based upon his/her performance? (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q14.
Self-appraisal is taken into consideration while performance is appraised (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q15.
Your IA Appraises you about your performance while evaluating the quarterly task sheets & PAR? (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q16.
You are fully aware about the PAR system being followed in HAL (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q17.
Your relations with your boss (a) Excellent (c) Good (b) Very Good (d) Average [ ]
Q18.
Your relations with your subordinate (a) Excellent (c) Good (b) Very Good (d) Average [ ]
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Q19.
Boss encourages you to approach him frequently for his advice and help (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q20.
You are helping your subordinates to become aware of some of their own strengths (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q21.
You clearly prescribe standards of behaviour to be followed in your work unit (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q22.
Give clear instructions to your subordinate what should or should not be done (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q23.
I communicate strong feelings to subordinates without caring whether this will affect their morale (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q24.
I try to set an example to my subordinates by my own behaviour (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q25.
I do not hesitate to criticize my subordinates for their bad performance even if they feel offended and do not accept my feedback (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q26.
I am available to my subordinates to solve their problems (a) Strongly agree 83 (b) Agree
(c) Disagree Q27.
(d) Strongly disagree
I enjoy my role very much because of the tremendous opportunities for my professional development here (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q28.
I do only routine things and have learnt nothing new (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q29.
I am slowly forgetting all that I learnt in my discipline (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q30.
Are you receiving feedback on your performance? (a) Yes (b) No [ ]
Q31.
If you are writing PARs as IA/RA then, on what basis are you rating your subordinates as Cat - A, Cat - B or Cat - C? ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
Q32.
If you are filling PAR as IA/RA, are you giving feedback to your subordinates? ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
Q33.
Are you satisfied with the system of PAR which is followed in HAL? Justify. ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
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Q34.
If you feel there should be some modifications in the PAR System, what all the changes do you want to make? ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
Q35.
The promotion policy of the organization (a) Excellent (c) Good (b) Very Good (d) Average [ ]
Q36.
Re-introduction of Internal Merit Selection (IMS) motivates you to excel in your work area. (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q37.
The written test is helping officers to improve their knowledge (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q38.
The policy of serving 3yrs. & 4yrs in the lower grade for promotion under IMS & DPC respectively (a) Excellent (c) Good (b) Very Good (d) Average [ ]
Q39.
The promotion should be deferred based upon the Leave without pay (a) Strongly agree (c) Disagree (b) Agree (d) Strongly disagree [ ]
Q40.
The procedure/process which is followed for promoting of Officers 85
(a) Excellent (c) Good
(b) Very Good (d) Average Thank you [ ]
86

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A STUDY ON PERFORMANCE MANAGEMENT SYSTEM WITH REFERENCE TO HINDUSTAN AERONAUTICS LIMITED BALANAGAR, HYDERABAD

Submitted for the partial fulfillment of MASTER IN BUSINESS ADMINSTRATION

D. NARASIMHA RAO Roll No: 08032E0023

Mr. T. PRABU KUMAR Associate Professor, SMS, JNTUH

Place: Hyderabad Date: ..

SCHOOL OF MANAGEMENT STUDIES JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD

Place: Hyderabad Date:..

Place: Hyderabad DR. A. R. ARYASRI Date: Director, SMS JNTUH

Place: Hyderabad Date:

PART C PART D PART - E PART F PART G PART H PART I

IA & RA IA & RA IA & RA IA & RA IA & RA PRB GM/MD/FD/CH HRD Cell

89-80 Above Average

BELOW 50 Below Average

Overall minimum qualifying marks (API + WT + Interview) 12

Normal Promotions IMS

60 out of 100 85 out of 100

was conducted in the month of May, 2011.

CHAPTER II REVIEW OF LITERATURE

IMPLEMENTING PERFORMANCE APPRAISAL SYSTEMS 19

CHAPTER III INDUSTRY PROFILE

HINDUSTAN AERONAUTICS LIMITED LOCATION AND BRANCHES

ORGANISATION GROWTH OF HAL

Hindustan Aircraft Limited at Bangalore

CERTIFICATION and accomplished the following milestone.

Repair and Overhaul 40

CHAPTER V DATA ANALYSIS & INTERPRETATION

1. Since how long have you been working in HAL?

NO. OF RESPONDENTS 2 43 22 34 101

% OF RESPONDANTS 1.98 42.57 21.78 33.66 100

2. The System of PAR which is followed in HAL

ATTRIBUTES Highly Satisfied Satisfied Dissatisfied Highly Dissatisfied Total Interpretation:

NO. OF RESPONDENTS 4 77 16 4 101

% OF RESPONDANTS 3.96 76.24 15.84 3.96 100.00

4% 4% 16% Highly Satisfied Satisfied Dissatisfied Highly Dissatisfied

3. Evaluation of Officers' performance on quarterly basis

ATTRIBUTES Excellent Very Good Good Average Total Interpretation:

NO. OF RESPONDENTS 9 30 45 17 101

% OF RESPONDANTS 8.91 29.70 44.55 16.83 100

Excellent 30% Very Good Good Average 44%

4. The Scale of gradation which is followed in HAL for PAR

ATTRIBUTES Highly Satisfied Satisfied Dissatisfied Highly Dissatisfied Total Interpretation:

NO. OF RESPONDENTS 6 76 14 5 101

% OF RESPONDANTS 5.94 75.25 13.86 4.95 100.00

Highly Satisfied Satisfied Dissatisfied Highly Dissatisfied

5. Devotion of 40% of marks in quarterly task sheets for improvement task

ATTRIBUTES Excellent Very Good Good Average Total Interpretation:

NO. OF RESPONDENTS 14 17 42 28 101

% OF RESPONDANTS 13.86 16.83 41.58 27.72 100

14% 28% Excellent 17% Very Good Good Average

6. Receiving of feedback on your performance by your boss

NO. OF RESPONDENTS 17 62 16 5 1 101

% OF RESPONDANTS 16.83 61.39 15.84 4.95 0.99 100.00

Strongly Agree Agree 42% Disagree 41% Strongly Disagree

8. Ratings are sometimes seen as based on subjective judgment

ATTRIBUTES Strongly Agree Agree Disagree Strongly Disagree Total Interpretation:

NO. OF RESPONDENTS 11 71 18 1 101

% OF RESPONDANTS 10.89 70.30 17.82 0.99 100.00

Strongly Agree Agree Disagree Strongly Disagree

9. Training is given subsequently as recommended in PAR

ATTRIBUTES Strongly Agree Agree Disagree Strongly Disagree Total Interpretation:

NO. OF RESPONDENTS 7 34 38 22 101

% OF RESPONDANTS 6.93 33.66 37.62 21.78 100.00