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Many researchers have done studies on performance appraisal system and
performance management system in India and abroad. It is very interesting to do
research on performance management system wherein this concept is being
introduced step by step. This chapter review of literature, reviews the literature of
performance management system herein published literature in the area was taken in
account. The literature review starts where Beer -et al (1979), McAfee and
Champagne (1993), Allan (1994), Armstrong and Baron (1998) have strongly
suggested that PMS if well designed and implemented leads to positive individual and
organizational outcomes. However, researchers have seen very specific elements or
outcomes of PMS rather than the whole system that may have been implemented and
for example performance discussions between subordinate and supervisors, during the
performance management process have been found to influence the performance and
behaviour of employees (Beer, 1981).
Leventhal(1980),Cascio and Bernardin(1981), Greenberg (1986), Alexander and
Ruderman(1987), Murphy and Cleveland (1991).The ability to appeal a rating, which
is considered unfair, inaccurate, or biased, is an important component to ensure
perceptions of procedural fairness.
There is a sufficient amount of empirical evidence exists in private sectors that
indicates that merit pay plans generally have a positive impact on employee
performance and organizational productivity (Heneman, 2002; Huselid, 1995;
Jenkins, Mitra, Gupta, & Shaw, 1998, Locke, Feren, McCaleb, Shaw, & Denny,
1980).
Dipboye, Robert L. and de Pontbriand, Rene (1981). In this study, 474 exempt
employees in a research and development organization were surveyed regarding their
opinions and perceptions of the appraisal process. Opinions of the appraisal and
appraisal system were positive to the extent they believed that (a) there was an
opportunity to state their own side of the issues, (b) the factors on which they were
evaluated were job relevant, and (c) objectives and plans were discussed.
Rao (1982). Conducted a survey of appraisal practices in 45 different organizations (
34 private and 11 public sector) and he found that about 50percent of the
organizations seem to profess the purpose of their appraisal as regulating employee
52
behaviour as well as developing employee capabilities. About 30 percent of them still
use appraisals only for controlling and regulating employee behaviour whereas only
about 10 percent seem to use appraisals mainly for developmental purposes.
Gangotra (1983). In a survey conducted in Jyoti Limited, Baroda wherein 70
managers responded to a questionnaire on performance appraisal system. Out of these
37 responded as appraisers and 33 responded as appraisees. Jyoti’s have an evaluation
system requiring each appraiser to assess his subordinates on performance related
qualities. After completing his assessment, each appraiser is expected to discuss with
his appriasee before sending form to personnel department.
Longenecker, Gioria and Sims (1987), Fried and Tiegs (1995). There is some
evidence that raters deliberately distort subordinates performance ratings for political
reasons, like manager provides inflated ratings to their subordinates in order to project
his/her good image or to avoid any confrontation.
Another study sought to identify factors related to employee perceptions of the
accuracy of performance ratings they received using a subjective rating system. It
also sought to determine if the relationship between these correlates and perceived
fairness and accuracy was moderated by employee sex and/or race. The results were
based on the analysis of items from questionnaires completed by 234 government
employees whose job performance was rated on a graphic rating scale.
Longenecker, Gioia, and Sims (1987). This indicates that managers have frequently
used the decision autonomy available to them under more traditional performance
management systems to bias and alter employee evaluations where both deflating and
inflating them, in order to further their own interests and given that procedurally just
performance management systems make such distortions more difficult, it seems
doubtful that managers will react favourably to restrictions on their ability to act
unilaterally. In support of this study, Brett, Ury and Goldberg (1989) have found that
managers who were "winning" under existing organizational conflict resolution
systems presented significant barriers to the implementation of procedures that
safeguarded the interests of both employees and their organization. Thus, there is
evidence that managers will react unfavourably to procedurally just performance
management systems, both because managers place a higher priority on efficiency in
53
HR procedures than on fairness and because they prefer to avoid constraints on their
decision autonomy.
Bies and Shapiro (1987).It is now a widely accepted fact that perceptions of fairness
influence the way people think, feel, and act on the job.
Amba Rao (2000) In Indian organisations, if employee has his own experiences of
success as well as found involvement in the PMS then it reduces the anxiety of
employees.
Wehrenberg, Stephen B. (1988). For measurement and evaluation of employee
performance, supervisors need to be trained otherwise correct evaluation cannot be
done which can cause damage to the employee evaluation.
Stephan and Dorfman (1989). Found that the outcomes of effective performance
appraisal are improvement in the accuracy of employee performance and
establishing relationship between performance on tasks and a clear potential for
reward and according to Grote, D (2000). Public organizations defined that
Performance appraisal today use an essential part of organizational life, for it
help to justify compensation differentiation, promotion, demotion, selection
validation, and termination.
Perry, James L –et al (1989). Four hundred and ninety six PMRS employees were
selected, employed by the U.S. General Services Administration (GSA). The results
indicate that PMRS merit increases have become automatic and the tendency to rate
large numbers of employees “fully doing well" which assures that many employees
receive performance awards as well. The opportunities to achieve large increases in
pay under PMRS still appear to be quite small.
Tyler (1989), Folger & Cropanzano (1998). This work usually has found that the
more just or fair employees consider such systems to be, the more satisfied and
accepting they are of the resultant outcomes, even when those outcomes are less than
desirable therefore the strength of these things has led to propose that the provision of
fair procedures is a more powerful foundation for the management of employees than
is the provision of valued rewards.
54
Eisenberger, Robert and Valerie Davis-LaMastro (1990).The study combining across
361 respondents in nine organizations such as manufacturing, insurance etc. There
was a highly consistent positive relationship of perceived support with employee
attendance and job performance. In addition, the positive relationship found in the
study between perceived support and employees' diligence in carrying out
conventional role responsibilities, perceived support might be associated with
constructive innovation on behalf of the organization without the anticipation of direct
reward or personal recognition.
Earley and Shalley (1991). Feedback and goal setting are widely believed to affect
performance positively through enhancing the motivation necessary for work
performance and Roberts and Reed (1996) proposed that goals, participation and
feedback impact on appraisal acceptance, which affects appraisal satisfaction and
finally employee productivity and motivation.
Guinn, Kathleen A and Corona, Roberta (1991). The lack of clarity about
performance goals reflected a lack of focus on results. It was perceived by the
employees that pay was increased based on their length of service than their
performance.
Mossholder, Kevin W –et al (1991). The study examined employee reactions and
perceptions with regard to role failure act and failure to maintain adequate privacy of
performance appraisal system wherein result indicates that organizations should
construct and administer appraisal system in such a way as to minimize employee’s
apprehensions about information privacy.
Kalpan and Norton (1992, 1993, 1996). They have developed the notion of a balanced
scorecard and suggest performance management including focusing on internal
business processes, customers, finances and learning and growth. Balanced scorecard
is key to translate the organization’s strategy into the right and integrated set of
measures, only then the performance management system can provide control by
providing guidance and monitoring financial results because these are the drivers of
future performance wherein employee know that how is to be performed? Where,
Peter Drucker (1992) uses of five gauges in business to control performance and
Reichheld (1996) suggests that performance management system is a key to success
55
and defines what a company will become by tracking the flow of value to and from a
company’s employee.
O’ Neal, Sandra and Palladino, Madonna (1992). A system which supports the
primary goals of the business by significantly improving the outcomes and
management of employee performance wherein performance management can
succeed and the challenges can be met by involving employees in the process and
providing tangible and fair rewards for observable high performance.
McCabe, Douglas and Lewin, David (1992). Two dimensions of employee voice have
been considered wherein first was the formal grievance procedure and second was
participative management. To keep employees and non-management personnel, away
from these things make effective impact on employee and organizational
performance.
Mc Afee and Champagne (1993). This study identified the certain key aspects for
successful PMS implementation wherein supervisors must chart out the critical
competence areas, discuss and work them out with employees to establish a feasible
action plan. Moreover, organizations must establish a norm for self development
“employees need to know that they are expected continually to enhance their job
skills". The goals must be mutually developed and should be measurable, specific,
relevant, attainable, time-framed and challenging. Managers must be provided with
training to explain them the purpose and specific methodology of performance
management.
Johnson, Bradford A and Ray, Harry H (1993). In McDonnell helicopter co. required
a new compensation system then human resource department asked to employees to
develop skill based pay system for their units where new system and involvement of
employees in its development has significantly increased productivity of organization.
Arthur,Jeffrey B. (1994). Identifying two types of HR systems control, commitment
and specific combinations of policies and practices are useful in predicting differences
in performance and turnover across 54 U.S steel minimills.HR systems moderated the
relationship between turnover and manufacturing performance.
56
Mavis, Mary (1994). Manager’s learning is required for taking employee feedback in
effective way therefore managers must validate feedback they offer to their employee.
Managers are required to understand and differentiate feedback and consequences
vary from person to person, even if the feedback different employees receive is
similar. Eventually, managers need to train for taking feedbacks. (Appendix-5)
Waldman, David A (1994). Suggested that performance management efforts focused
on group level rewards and appraisal will have a greater positive effect on Total
Quality Management implementation efforts than on efforts focusing on individuals,
particularly at lower hierarchical levels. Moreover, these effects will be further
maximized when coupled with a continuous improvement approach to work systems.
Wyatt (1994). Carried out a study which focusing on identifying best practices in
performance management by examining the systems of a selected group of 37
companies recognized for financial success and innovative human resource programs.
This emerged from the study, are a set of best practices that could facilitate the
process of designing, implementing, and monitoring performance management. These
are: internal and external alignment; flexibility, simplicity, decentralized control, a
measurement process, greater links between performance and pay, feedback from
multiple sources, senior management involvement and employee development.
Huselid, Mark A.(1995).Evaluated the links between systems of high performance
work practices and firm performance. Sample of nearly one thousand firms indicate
that these practices have an outcome of turnover and productivity of corporate
financial performance.
Murphy and Cleveland (1995). Performance management systems will work most
excellent when the formal goals and organizational uses of performance appraisal are
consistent with the goals of other appraisal elements along with the rater and the ratee.
Murphy and Cleveland (1995).There are typically many penalties and few rewards for
doing true appraisals. Employees are likely to regard a less than glowing performance
appraisal as a punishment, even if it is richly deserved and honest appraisals are likely
to lead to ill will between subordinates and supervisors. (Appendix-3)
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Taylor, M.S -et al (1995). Performance management is the area in which manager’s
reactions have been found in this area which indicates that the time and effort required
of managers are much greater for more procedurally just performance management
systems than for more traditional and less procedurally fair systems, which have
fewer safeguards against bias and fewer opportunities for employee voice.
Dolan, L.Shimon and Moren, Denis (1995). Data were collected from 487 non-
management subordinates in a large fast food restaurant enterprise in province of
Quebec. The results indicate that the quality of rater ratee relationship is significantly
related to overall ratee perceptions of the appraisal process, perceived fairness of
appraisal process and acceptability of the PA system.
Sabharwal (1995), Gopalan and Rivera (1997). Studies indicate that the Indian society
is characterized by a culture of high power distance between superiors and
subordinates.
Tang and Sarsfield-Baldwin (1996), Thurston (2001). This research indicates that
procedural and distributive justice factors have been consistently correlated with
employee’s positive affective reactions toward their performance appraisal system.
Bradt, Jeffery A (1996). Employee would be more motivated by a performance
management system that focuses on their contributions to the organization. The key
determinates of employee motivation is right evaluation of their contribution.
Flapper, Simme DP –et al (1996). Have a consistent PMS more is required than a
consistent performance measurement system where the functions in the organization
and the tasks for which they are held responsible have been understood to be given.
This does not apply for new organizations or new tasks however, but in that case it
has to be decided which responsibilities should be assigned to which functions.
Sparrow and Budhwar (1997). It was found that trust with the leader plays major role
in the acceptance of PMS.
Gosselin, Alain –et al (1997). Diverse 265 employees were surveyed and result
indicated that performance feedback should be an ongoing process from their
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supervisors. Ratees preferred to have their assessments more than once in a year, at
least twice in a year.
Odden and Clune (1998). Whether it comes through district decentralization or
school choice options, site-based budget autonomy has been theorized to have
the potential for improving resource allocation and school performance and Odden
and Kelley (2002) argues that school-based budgeting allows for more flexible and
efficient compensation plans aligned with performance and skills.
Cawley, Brain D. (1998). Participation in performance appraisal process was most
strongly positively related to the employee satisfaction and the PAS perceived utility
of the appraisal, motivation of employees to improve performance as well as
perceived fairness of the system.
Wright, Allan (1998). This study reveals that to build a strong working relationship
with a subordinate, particular emphasis is placed on the skills necessary because
without these skills lasting changes in performance are unlikely to occur.
Mount, Michael K –et al (1998). 2350 managers rated their own performance and
were also rated by two subordinates, two peers and two bosses and result indicated
that trait effects in the performance ratings.
Taylor, Susan M –et al (1998). They examined manager’s reactions to the
implementation of a procedurally just performance management system in two
samples where findings indicated that managers who perceived unfairness in their
own most recent performance evaluations reacted more favourably to the
implementation of a procedurally just performance management system than those
who did not perceive unfairness.
Otley (1999), Ferraira and Otley (2005). A curiosity in performance management has
been an issue of latest academic attention which has a distress with the use of targets
in this perspective and this attention is significant in relation to the public services
where there has been a distinguished practical focus on the use of targets (Broadbent
and Laughlin, 2006) which are argued to be performance procedures that can be used
in the context of performance management system.
59
Talyor, P J and Pierce, J L (1999). A longitudinal evaluation was conducted on the
effects of introducing a performance management system which attributed employee
attitude, merit based pay etc. in government organizations. The results indicated that
performance planning and goal setting component of the system had favourable
consequences for at least some employee’s attitudes and for lower performing
employees the organizational commitment and increased cooperation and satisfaction
with one’s supervisor.
Stivers, Bonnie P and Joyce, Teresa (2000). Performance management systems
should include a balanced set of procedures that are linked to the organization’s
strategic objectives wherein managers require timely “gauges” to control operations
and get feedback on strategy achievement wherein these gauges must be provided in a
balanced performance management system which includes both non financial and
financial measures.
Herman, Steensma and Lisette, Otto (2000). In this study 78 employees and 33
supervisors completed a questionnaire to evaluate Performance Appraisal (PA)
sessions. The results demonstrate supervisors perceived that they used more
participative leadership and had better conversational techniques than the
subordinates perceived. Supervisors also had a more positive perception of the
number of topics that were discussed in PA sessions.
Mabey, Christopher (2001). Conducted study of participants in a 360-degree
programme for middle and senior managers at a UK university where finding
indicates that 360 degree does have the effect of catalyzing more focused self
developmental activities and this is more favourable appraisal of development is due
to enhanced motivation and more accurate diagnosis arising.
Thurston (2001), Cook and Crossman (2004). Perception of fairness of the
performance appraisal system would influence positive affective reactions like
performance appraisal satisfaction.
Byrne and Cropanzano(2001).Distributive fairness, procedural fairness, and
interpersonal fairness are integral components of’ organizational justice, which
may be defined as the study of fairness at work.
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Crouch, & Mabogoane (2001). This provides great insights for performance
management in institutions because performance management fills the gap in the
needs to manage faculty performance and it is also used to get a basis posture for
professional development and feedback in terms of vocation performance.
Crouch, & Mabogoane (2001). Provides great insights for performance management
in institutions since, performance management fills the gap in the needs to handle
faculty performance and it is also used to get a basis posture for feedback and
professional development in terms of vocation performance.
Erdogan, Berrin (2002). Procedural, interactional, and distributive justice perceptions
are examined in terms of their theoretical and measurement properties. The proposed
model identifies several directions for future research in performance appraisal area.
Justice perceptions will be related to organization-related, leader-related, and
performance-related outcomes, through improved exchanges with the organization
and the leader, and through increased accountability pressures. Therefore,
performance appraisal is argued to be a critical incident, which shapes future
interactions between the leader and member as well as the leader and organization,
and influences future attitudes and behaviours. Differential relationships are expected
between different types of justice and outcomes, but all types of justice perceptions
are argued to be important for organizational effectiveness.
Neary, D. Bradford (2002). This study was done at TRW Inc. where approx 100000
employees were employed. The company implemented a common, online and
companywide system that supports company’s performance management system.
This system got overwhelming positive response and it was a uniform and effective
way to evaluate and develop employees.
Chen, Zhen Xiong –et al (2002). The sample was taken from six Chinese companies
to investigate the relationship between loyalty to supervisor and employee’s in role
and extra role performance in comparison with that of organizational commitment.
The result indicated that loyalty to supervisor was more strongly associated with both
in role and extra role performance than organizational commitment.
61
Jude, T. Rich (2002). To avoid mismanagement of performance, there are two critical
changes required to move in performance management. The first is to avoid making
performance management once or twice a year and feedback must be on regular basis.
The second is to shift from a one size fit processes for all the employees with different
types to tailor made processes according to the nature of work.
Thach, Elizabeth C (2002). 281 executives participated in a six months coaching and
360 degree feedback process and result suggested that combination of individual
coaching and multi-rater feedback do increase leadership effectiveness, eventually
coaching and 360 degree feedback makes positive impact in terms of developing
leaders.
David P. Baker and R.Key Dismukes (2002).Explore facets of crew- performance
assessment and discuss specific strategies for training pilot instructors to accurately
assess aircrew performance.
Risher, Howard (2003). A bell-shaped curve may not be right for every employer but
it is important to recognize the star and poor performers and star performers to be
rewarded in a way that confirms their value whereas the poor performers need to
leave or improve. The performance system alone is not able to create a high-
performance organization and it needs to be seen as well as managed, as an element of
organization strategy. It is an important tool for communicating priorities and for
providing essential feedback and new expectations. Performance management must
not be handled as an HR problem.
Lawler and McDermott (2003) in their study on performance management practices
of medium and large US corporations found that PMS design related practices or
factors such as goals, business strategy driven performance, joint establishment of
performance goals, performance results, development planning and salary linkage
were highly correlated with system effectiveness.
Wingrove, Clinton (2003). New technology and processes recommend solutions for
ineffective performance management systems and for maximum impact, technology
should be designed to support the process and the process must be designed to reflect
what current technology can now support.
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Lawler, E and McDermott, M (2003). 55 HR managers from medium and large
companies participated at the University of Southern California where results strongly
argue that practices like goal setting, competency models, communication, reward
system practices, behaviour of managers and training all potentially have a positive
impact on the effectiveness of performance management system.
Groeschl, Stefan (2003). Evidence has been provided that supports the assumption
“culture is an important factor influencing the understanding and interpretation of the
performance appraisal process and its development, implementation and other
performance appraisal related characteristics”.
O’Neill, Colleen and Holsinger, Lori (2003). Mercer survey of 300 large North
American companies, it has been found that A) Organizations are better at evaluating
performance than providing ongoing feedback. B) Despite skill gaps, there are little
training given which effects the performance of employee. C) Performance
management systems are more aligned with compensation than with development. D)
Performance planning if important factor for any change or improvement in employee
as well as organization performance.
Roberts (2003). Studies have found that the supervisor’s goal setting behaviour, and
his/her relations with subordinates accounted for 53% of the variance in
appraisal satisfaction, and employees’ perception of their meaningful role in the
appraisal process enhances their satisfaction and acceptance of the system.
Lawler and McDermott (2003). In their study on performance management practices
of large and medium US companies found that PMS design related factors or
practices such as business strategy driven performance goals, performance results and
salary linkage, joint establishment of performance goals and development planning
were highly correlated with system effectiveness. In this study, they also found certain
“high impact” practices which brought about “differentiation” in performance
management process and these are: termination of lowest rated individuals, training
for appraisee, calibration meetings (that compare ratings by different managers) and
e-HR systems.
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Problems with the design or implementation of merit plans may interfere with
employees’ perceptions of either distributive equity or procedural equity (Folger &
Konovsky, 1989, Terpstra & Honoree, 2003). Perceived pay inequity may lead to
decreased motivation and performance, lower overall job satisfaction, higher
absenteeism and turnover, and more pay-related grievances and lawsuits (Milkovich
& Newman, 2005).
Paul and Anantharaman (2003).Used interviews with employees in 35 different
software companies located in India to show the positive effect of ‘people
management practices’ on organizational performance and people management
practices were defined by nine indicators, training, performance appraisal, induction,
selection, job design, work environment, compensation, career development and
incentives.
Luthans, Fred and Peterson, Suzanne J. (2003). The study suggested that when 360
degree feedback is combined with coaching, it is enhancing self awareness and
behavioural management which leads to improve self and employee attitudes and
eventually even improved performance of employee. Herein, feedback coaching
resulted in employee and manager satisfaction, intention to turnover, commitment and
lead to organization’s performance. Feedback-coaching is a winning combination to
help in competitive world economy.
Furnham, Adrian (2004). Feedback is supposed to be correcting or rewarding and its
aim is to give useful insight into work processes and outcomes. Moreover, at
workplace managers required to know not only how to score or ranking and judge, but
also how to give that information back to employees or individuals. Annual appraisal
system was not taken seriously and often not conducted at all, because since they had
little connection with rewards, pay or promotion.
London, Manuel –et al (2004). They suggested that educating employees and
managers in the context of the expected performance dimensions, can help them to
recognize desired behaviours, evaluate performance correctly and provide meaningful
feedback, as well as guide their own goal setting and performance tracking. Feedback
workshops, appraisal discussions and coaching can make easy these processes.
Performance evaluation and goal setting can be used to establish a wide range of
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developmental assignments and an ongoing program evaluation is required to identify
areas for continuous enhancement of the system.
Summers, Lynn (2005). Effective pay for performance requires that two processes,
performance management and compensation management, not only function well
separately but also operate together in an integrated way. Compensation management
cannot fully realize its potential without accurate assessments of individual
employee’s performance, assessments that properly come from a performance
management system.
Varman, Rahul (2005). Evaluation of performance appraisal system of Kashipur
textile showed that implementation of performance appraisal system in family run
business, found difficult as well as professionalize their management system. which
inculcate, lack of information for goal setting, discrepancy between self rating and
supervisor’s rating, communication barriers and the PA system was based on
personality traits.
Appelbaum, Steven H. and Jacques, Adam –et al. (2005). Conducted a survey to
measure employee satisfaction and found a correlation between job satisfactions, low
motivation and the resulting low productivity. A direct correlation was also found
between low productivity and poor communication between management, supervisors
and employees.
Waal, Andre A.De (2006). This study was conducted in an organization to know the
effect of behavioural and cultural factors on their performance management system
where it has been found that behavioural and cultural factors were having less
importance in performance management system. (Appendix-10)
Pedzani,Monyatsi and Trudie, Steyn –et al (2006). In this study,413 respondents
captured teacher perceptions of the appraisal system in secondary schools in
Botswana. In results, it appears that many teachers did indeed believe that teacher
appraisal could be beneficial in motivating them to improve their performance.
However, most teachers appeared to be either doubtful or negative about this. This is
indeed a disconcerting finding.
65
Nankervis and Compton (2006). In their study, they covered 961 organizations of
Australian industry and came out with few ultimate principles of PMS. These are 1.
Strategic alignment of organizational goals and employee goals and outcomes 2. User
friendliness, consistency, equity and transparency 3. Clear links between appraisal
and salary review 4. Human resource development, coaching and succession plans.
De Nisi and Pritchard (2006) in their expectancy based motivation model for
individual performance improvement presented a number of implications for the
design of an “ideal' PMS”. This study shows that the system should be simple and
transparent so that performance ratings can be easily understood by employees and
performance standards and expectations should be clearly stated so that everyone
involved (appraisee, appraiser and HR) understands what is rewarded and what is
expected. Separate appraisals for feedback and decision making purposes would make
the process easier to understand and explain. Beyond formal appraisals (which happen
half yearly or once a year), informal appraisals and feedback must be a part of the
system.
Nankervis and Compton (2006). In this study, 961 Australian organizations were
covered and came out with few ideal principles of PMS design and implementation.
These principles are: user friendliness, strategic alignment of organizational goals and
employee goals and outcomes, clear links between appraisal and salary review,
consistency, equity and transparency, human resource development, coaching and
succession plans.
Morgan, Robert (2006). The performance management systems do hold the potential
for greatly improving the efficiency, capabilities and strategic value of compensation
and benefits professionals and their associates in human resources. To improve the
usefulness of performance management systems, the key is integrating them into a
holistic and strategic talent management system. Then human resource professionals
can influence technology to create, update, and continuously improve full-scale,
comprehensive talent management programs. (Appendix-6,7,8)
Kuvaas, Bard (2007). The study examined two different models of the relationship
between employee perceptions of developmental performance appraisal and self-
reported work performance: a mediation model and a moderation model. Results from
66
a cross-sectional survey of 434 employees showed that the relationship between
perceptions of developmental performance appraisal and self-reported work
performance was mediated by employee’s intrinsic motivation, and strongly
moderated by their autonomy orientation. For employees with a weak autonomy
orientation, the relationship was positive, but for those with a strong autonomy
orientation, the relationship was negative.
Helm, Corey –et al (2007). This study conducted University of Texas, M.D.Anderson
cancer centre, Texas where results indicated that there is positive link between pay
and performance of employees as well as goal alignment plays a vital role in
performance management system.
Bhatnagar, Jyotsna (2007). The result of 272 BPO and ITES employees survey,
showed low engagement at the beginning of the career and after completion of 16
months with the organization, they showed high engagement levels and also indicated
high loyalty but only for a limited time. Organizational culture, career planning,
incentives with organizational support are three distinct factors in which the first two
were pinpointing of high attrition.
Rao, A Srinivasa (2007). Study conducted in Grasim cement industry, where it is
found that employees were aware about goal setting process and the system in general
but there was a gap in communicating with superiors. Generally, superior treat
performance appraisal process as an authority.
Memon (2007) concluded that quality of faculty is an input to institutional success
and for ensuring the quality of faculties there must be well defined performance
criteria. This study quoted educational qualification, teaching practices, nonexistence
of proper monitoring system or effective supervision as reasons of low quality of
teaching.
James R. Van Scotter and Jennifer R. Burnett. (2007). After expert ratings were
obtained, US Air Force Officers with an average of six years experience rated the
performance of four officers who delivered 6-7 minute briefings on their research
projects; 26 raters reported being acquainted with one or more of the briefers. Raters
were randomly assigned to use a rating format designed to encourage between-ratee
comparisons on each dimension or a format in which each ratee was separately rated
67
on all dimensions. The results show that prior acquaintance with the ratee results in
more accurate ratings. Ratings were also more positive when raters had prior contact
with the person they rated.
Oakes, Kevin (2007). The study result shows that most of the organizations only aim
to use the performance management process for employee learning and development,
goal setting, compensation and identification of key performers.
Terpstra & Honoree (2008). Very little empirical research has been conducted
concerning the pressure of merit pay plans on faculty performance in four-year
colleges and universities. However, one recent study found that faculty perceived
their merit pay plans to have a somewhat positive effect on service levels, teaching
effectiveness, research quantity and quality. Problems with the design or
implementation of merit plans may interfere with employees’ perceptions of either
distributive equity or procedural equity (Folger & Konovsky, 1989, Terpstra &
Honoree, 2003) and perceived pay inequality can lead to decreased motivation and
performance, lower overall job satisfaction, higher absenteeism and turnover, and
more pay-related grievances and lawsuits (Milkovich & Newman, 2005).
Sanwong, K (2008). 75 employees studied at a Thai university and covered
supervisors, clients, juniors and employees wherein it has been found that the 360-
degree appraisal system is successful to evaluate employees.
Luthans, Fred –et al (2008). This study conducted to examine whether the use of
social recognition, money and feedback have a similar impact on employee
performance in the context of a modern Korean broadband internet service firm and
found that money and social recognition had a major impact on performance
outcomes but feedback did not result in as strong. When compared to the control
group then all three reward incentives showed significantly more improvement of
overall performance. Though, social recognition would have a relatively stronger
impact than money and feedback in this context was not statistically supported.
Rao, T.V (2008). Despite the fact that PMS is treated as a system it should be
recognized that it is more than a system and it is in fact the reason for the very
existence of employees and the organization. Reducing the entire year’s work of an
employee to a number is ignoring the potential of employee in building organizations.
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Performance appraisal ratings are bound to be subjective wherein they should be
treated with respect and kept at a remote. By using IT support and other technological
advancements participation, trust, and transparency can be enhanced. The time has
come when PMS can be taken out of the hands of the HR Managers and given to the
line managers, the ownership and seriousness can be shifted to line managers, and
PMS can be integrated better with work and business. However, it should not be a
full-time job, but only a part-time job so that no new power centres get developed and
HR Managers can at best be used to facilitate the developmental needs by gathering
and disseminating learning resources, learning interventions, and packages.
In 2008 a paper reports on a study that used focus group interviews with employees in
an upscale hotel in Hong Kong, a special administrative region in China, on their
views of the appraisal system that has been used. Research findings reveal that the
system could be further improved.
Bowes, Barbara (2009). “Objectives need to be cascaded throughout the organization
and clearly communicated to employees”. A performance management system is not
about trying to control employees, but rather to focus on improving overall
performance and this does not only ensure that the employee is doing the correct tasks
but also ensures that there are effective organizational supports in place to help make
it happen and management needs to ensure rewards are in tune with organizational
goals.
“A key reason that people leave their jobs is a perceived lack of company direction”.
Moideenkutty, Unnikammu (2009). The study was done to understand the
organizational citizenship behaviour and individual outcomes wherein result indicate
positive relationship between citizenship behaviours and social exchange outcomes
provided by supervisors exist. Supervisors providing social exchange outcome for
individuals.
Sharkie, Robert (2009). In this study, it has been found that vulnerability of
employees in the employment relationship has increased the importance of trust in
encouraging employee for extra role behaviour outside their contractual or legal
compulsion. Trust can make strong relationship bond which can help in increasing
employee performance.
69
Mamman, Aminu –et al (2009). In this study, secondary and primary data were
collected from two multinational organizations working in Nigeria, i.e ESN Nigeria
and KG Nigeria. The results of investigation and the review of literature shows that
the Performance Management (PM) policies are partially ethnocentric but the
practice, as perceived by some organizations, is polycentric. For instance, some
organizations perceived some degree of patronage and nepotism in the system as well
as many felt that their line managers were biased against them. Likewise, a significant
number of employees felt that their views were not taken into account during PM
review as well as they do not get any feedback from their supervisors. This shows that
local supervisors and managers adopted HRM policies anyway. Herein, also noted
that differences between policy and practice wherein lag in the implementation of the
policy. The findings that line managers do not implement PM policies as prescribed
but also that there are variations across organizations regarding the degree of
adaptation of PM practices.
Ohemeng, Frank L.K (2009). Information obtained from interviews of senior
bureaucrats and chief executive officers of state-owned enterprises (SOEs) of Ghana
and result shows, many developing countries have introduced performance
management as a means to measure individual and organizational efficiency in order
to ensure that public sector organizations meet the needs of the public. The
implementation of performance management systems in many of these countries has
been affected by a number of constraints like institutional disintegration, culture,
public apathy and leadership support, thus making it difficult for many of them to
realize the ‘benefits’ of such a system. With these constraints, performance
management no matter how attractive it may be will not achieve the desired results in
developing countries and the influence of socio-cultural norms on the bureaucratic
environment should be carefully analyzed and incorporated into the system being
developed.
Kumari, Geeta –et al (2010). This study was done on performance management
system applied in Endurance private limited, Maharashtra in India wherein most of
the employees were in the opinion that performance management system is strongly
needed and it carries a very high impact on performance of the employees. Moreover,
this system should also be continuously reviewed and if there is a need, it should be
70
changed as per the need. All the employees must have a clear vision about “what they
have to achieve” therefore proper guiding the subordinates to decide their
performance targets for the employees to work accordingly as well as supervisors
must help their subordinates to decide their performance targets.
Jie Chen, Derek Eldridge (2010). The study conducted on an MNC subsidiary located
in Southern China where it has been found that the implementation of appraisal
system was distant from attaining an optimistic effect in a Chinese business setting
like employees were nowhere near being able to be involved in setting objectives and
developmental plans. The appraisal system was not perceived be fair enough due to
the influence of seniority based rewards system and supervisors hesitated to take
ownership of performance reviews.
Liu, Xiangmin and Batt, Rosemary (2010). This multilevel study examined the role of
supervisors in improving employee performance through the use of coaching and
group management practices and result indicates that the amount of coaching that an
employee received each and every month predicted objective performance
improvements over time. Workers showed higher performance where their supervisor
emphasized group incentives and group assignments as well as wherein technology
was more automated. Eventually, the positive relationship between coaching and
performance was stronger where supervisors made greater use of group incentives and
technological changes were less frequent.
Goyal, Rita (2011). For the purpose of the study, data were collected through personal
contact of 250 employees in four branches of LIC in northern India. The result of
study revealed that difference is significant between the perception of male and
female employees regarding performance appraisal. Female employees have
favorable attitude towards performance appraisal as compared to male employees.
There is no significant difference among employees at different level regarding their
perception of performance appraisal selected branches of LIC.
Schraeder, Mike and Jordan, Mark (2011). This sets in motion the eternal need for
scholars and managers to remain cautious in understanding shifting employee needs
and dynamic organizational contingencies which have implications on the process of
managing employee performance. Practices related to managing employee
71
performance are likely to change over the time (Diana, Deadrick and Donald,
Gardner, 1997).
Omboi, Bernard Messah and Shadrack, M. Kamencu (2011). In this study population
of interest in the selected tea estates of Kenya wherein 70 respondents were selected.
The study revealed that competence, assessment and development, management by
objectives, performance based pay and employee training all affected employee
performance in Kenya tea development agency.
Reddy, Anuradha (2011). This study conducted to analyze the impact of culture and
cultural dimensions on performance management in UAE organizations. The
conclusion found that policies and procedures need to be shaped in such a way that it
comply with culture of both the countries. The most important explanatory variable is
subsidiary role and national culture of the country of origin. This carry significance as
organizational capabilities of the subsidiary companies increase, the role of subsidiary
employee in achievement of corporate objectives also increases.
Mone, Edward –et al (2011). Study conducted in a large corporation and results
indicated that performance management can play an important role for managers, as
fostering high level of employee engagement and avoiding burnout. Eventually, it is
found that performance management is a driver of employee engagement.
Chen, Tingting –et al (2011). For the study, the data were collected from 185 full time
employees in China and results revealed that developmental and evaluative
performance appraisals were linked to appraisee reactions to the workgroup in both
positive and negative sense wherein these two relationships were mediated by
perceived cooperative goals and competitive goals, respectively. Finding shows that
individual performance appraisal has both direct and indirect mediating effects on
attitudinal reactions to workgroups.
Prasetya, Arik and Kato, Masanori (2011).This survey was conducted at PT. Telkom
Kandatel Malang which is a company engaged in telecommunication services in
Indonesia. The 57 respondents in this survey are permanent employees of PT.
Telkom Kandatel Malang with working experience more than 3 years. This
study revealed that the perceptions by the employees of PT. Telkom Kandatel
Malang concluded that the majority (> 50%) already know and understand well
72
about the purpose, type, timing, methods, and related interviews conducted,
although there are some employees who have different views. Regarding the
salary system at PT. Telkom Kandatel Malang in terms of the level of justice,
competitiveness, and clarity, more than 50% of employees said fair enough, quite
competitive, and it was clear.
Shrivastava, A and Purung, P (2011). The study was done on two Indian bank where
one was government and another was private. From 340 employees data were
collected including both the banks situated in India. Result indicates that performance
appraisal system (PAS) of both the banks was significantly different where private
sector bank employees perceive performance appraisal factors, such as rater’s
confidence, goal setting, providing feedback, clarifying expectations and explaining
rating decisions to be fairer and feeling satisfaction with their PAS, as compared to
the government bank employees.
Azzone, Giovanni and Palermo, Tommaso (2011). This study was done on six Italian
central government institutions and study shows that performance appraisal and
rewards as a mechanism to provoke a shift in organizational culture and the behaviour
clearly tends to neglect the learning dimension of the change Process.
Risher, Howard (2011). This study suggested that performance management may be a
valuable tool when systems are properly designed and implemented and the key is
providing adequate preparation and support for managers.
Barani, G. and Rajesh. R (2012). This study focus on the factors influencing on the
performance of faculty members in technical education institutions in Tamilnadu and
100 respondents are selected wherein primary data is collected by using structured
questionnaire. This research work has been carried out to investigate the factors
influencing faculty performance of technical education institutions wherein personal
profile contains 81% of respondents are male, 52% of respondents are between the
age group of 23-30 years. 47% respondent’s monthly salary less than 10,000, 49% are
lecturers , 34% are UG holders, 48% belongs to engineering disciple and 48% are
having experience less than 2 years. Factor analysis extracted six factors which
influences highly on the performance of faculty members and these factors are,
personal benefits of the faculty members, job security aspects, additional
73
responsibilities, training and development, teaching aid and facilities in the college,
and work freedom in the routine work schedule. Results show that all the factors
identified by factor analysis have direct and positive impact with the factors
influencing faculty performance.
Mensah, Francis O.B –et al (2012). Data was collected from 140 both academic and
administrative employees of the institution in Ghana, who had worked in the
institution for at least two consecutive years. The result revealed a negative perception
that the employees held of the Performance Appraisal System (PAS) and also indicate
that employees of the institution perceive that the performance appraisal system of the
institution is affected by subjectivity and is influenced by some major errors where
the most common of which were the similarity and the halo effect biases. Many of the
employees viewed the system as important to both their individual career goals as
well as the objectives of the institution but there was irregular and inadequate
feedback on appraisal outcomes to all employees, except in the case of very poor
performers. Performance Appraisal (PA) was conducted only annual basis, and this
created fertile grounds for the occurrence of the recency error.
Chang, Chu-Hsiang –et al (2012). The result of analysis shows relation of Core Self
Evaluation (CSE) with a variety of outcomes which is including in-role and extra-role
job performance, job and life satisfaction and perceptions of the work environment.
The effort on CSE’s incremental discriminate and predictive validity recommends that
CSE has the potential to be an influential conceptualization of how we see ourselves.
Risher, Howard (2012). His survey revealed no evidence companies are considering
the elimination of the practice of performance management. Those who are involved
in planning or managing performance systems need to develop strategies for
addressing problems and building support as well as the audit must be part of any
action plan.
Gupta, Vishal and Kumar, Sushil (2012). The study investigated the relationship
between justice perceptions and a one dimensional conceptualization of engagement
and the relationship between justice perceptions and a three dimensional
conceptualization of engagement. Findings revealed a significant positive relationship
between distributive and informational justice dimensions and employee engagement.
74
Distributive justice and informational justice dimensions were found to have a
stronger impact on employee engagement conceptualized as antipode of burnout.
Significant relationships were found to exist between distributive and informational
performance appraisal justice dimensions and engagement, even when the measures
were used of engagement that conceptualizes it differently. Therefore, the results
provide some support for the justice engagement relationship. Employees who
perceive distributive and informational justice during performance appraisal process
are more likely to be engaged in their work and exhibit greater well-being. More
specifically, employees who perceive procedural justice during performance appraisal
session show greater interest employees who perceive distributive performance
appraisal justice exhibit greater dedication and vitality. Employees who perceive
informational justice are more physically, cognitively and behaviourally engaged in
their work. Employees who feel that they have been given fair ratings also tend to
believe that the procedures followed are fair and just.
Chompukum, Pachsiry (2012). In this study data were collected from 476 employees
in the four largest banks in Thailand. Suggested proposed model, it would be expected
that attitude towards performance evaluation would correlate with linkage between
consequences and targeted performance, coaching and perceived performance
management effectiveness.
Francis O. Boachie (2012). The study conducted on polytechnic in Takoradi, Ghana
where data was collected 140 employees of the institution, which included both
academic and administrative staff both. The study indicates that employees of the
institution perceive that the performance appraisal system of the institution is affected
by some major errors.
Akuoko, Kofi Osei (2012).For the study data were collected from 147 employees of
six financial institutions were chosen in the Kumasi Metropolis, Ghana. The study
demonstrated that the performance appraisal system can be an effective tool in
employee motivation if both the process and outcome are fair. The study also revealed
that employee participation in the appraisal process was high and this led to employee
motivation and perception of the process and outcome as fair.
75
Sahoo, Chandan K and Jena, Sambedna (2012). Performance management system
utilized by the manufacturing sectors shows that no single system is successful in
enhancing the performance of an organization and the PMS’s function has a
significant positive impact on performance of the employees when it is implemented
successfully.
Baird, Kevin –et al (2012). The survey conducted 450 Australian local governments’
employees where performance management systems of Australian local councils were
less effective in relation to the achievement of staff related outcomes and moderately
effective in relation to performance related outcomes. The results indicated a
significant relationship between the uses of multi dimensional performance measures
like training, link of performance to rewards, team work and respect for people,
outcome orientation with the effectiveness of PMS. Many other factors were found to
influence the effectiveness of performance management system for small and large
sized committees.
Singh, Anupriya (2013). This research was conducted in four Indian software services
organizations with the purpose of understanding the perceptions of HR managers
regarding design, implementation and outcomes of their organizational performance
management systems. It is gathered that the most important purpose for which PMS is
designed is “compensation and rewards” (more than 90% HR managers stated this)
and “Providing performance feedback” and “Promotion” are two other important
purposes to a great extent as identified by more than 80% HR managers. The least
popular objectives for which the PMS is perceived to be designed are: “retention or
termination”, “identification of training and development needs” and “assigning role
in a project”.
Fragouli, Evangelia E (2014). Through questionnaire, sample data collected from 30
employees of the private sector where study found that an effective management
policy of human resources and performance management could be a way to come out
from organizational crisis or at least can reduce the loss of organization’s profit. It
also revealed that human resources management policies and performance
management practices as one of the most important and evolutional managerial skills,
could be a way out of the economic crisis period.
76
Sawitri, Dyah and Muis, Mahlia (2014). Training and development function, it is a
logical application of a employee development process which is very familiar to the
performance management system and if the top management personnel in the field of
training and development has undergone significant experiences within the strategic
planning, the operational lines is often seen as a essential and important process for
employee as well as organizational development.
By reviewing of many published papers and articles of foreign and Indian authors, the
gap was found for study. There are studies conducted in the field of manufacturing,
finance, education, airline, IT etc. but it was found that no study was conducted
specifically for cement companies in India.
79
3.1 The Study
By the extensive literature review, it has been found that work on PMS is done in
many India and other countries and there is no significance work done for cement
companies in Indian context. PMS is very important factor in Human Resource
Management (HRM), which plays a key role in cement industries because often
cement industries are situated in remote areas wherein basic amenities, work
environment, work life balance, benefits etc are major concerned. The present study
will focus on factors of PMS of cement companies in Rajasthan. Wherein important
factors of PMS in cement companies will be identified by factor analysis. Then,
further these factors have any significant differences with demographic variables are
to be analysed.
3.1.1 Hypotheses
Hypotheses of study are:
1H0 : There is no significant difference of factors of PMS for gender.
1H1 : There is significant difference of factors of PMS for gender.
2H0 : There is no significant difference of factors of PMS for age.
2H1 : There is significant difference of factors of PMS for age.
3H0 : There is no significant difference of factors of PMS for education.
3H1 : There is significant difference of factors of PMS for education.
4H0 : There is no significant difference of factors of PMS for designation.
4H1 : There is significant difference of factors of PMS for designation.
5H0 : There is no significant difference of factors of PMS for year of service.
5H1 : There is significant difference of factors of PMS for year of service.
Hypotheses could have been made with all the identified factors with demographic
variables but, since factors of PMS were not identified at the time of study therefore
80
hypotheses for the study were taken in broader sense. This study can be taken further
for all the identified factors with demographic variables, as future research.
3.2 The Design
The quantitative study is done where primary data collected by administering
questionnaire from cement company’s employees of Rajasthan.
A factorial study is an experiment whose design consists of two or more factors and
each with discrete possible levels whose possible combination is made of these levels
across all such factors. These designs are called “factorial design” (William,
M.K.Trochin, 2007).
A factorial design is the most common way to study the effect of two or more
independent variables and in a factorial design, all levels of each independent variable
are combined with all levels of the other independent variables to produce all possible
conditions(William, M.K.Trochin, 2007).
A factorial design is normally used by scientists wishing to understand the effect of
two or more independent variables upon a single dependent variable.
Factorial design is a tool that is particularly useful to the marketing manager. Since
most of the elements that influence the profitability of a product cannot be physically
isolated and controlled, the influence of the many variables must be studied at one
time. This can best be accomplished by the use of factorial design (Kenneth P. Uhl,
1962).
Mainly, factorial design is a technique which permits a statistical indication of the
significance and the interaction of the various factors used in the sample experiment.
Basically, factorial design is a technique which permits a statistical indication of the
significance and the relationship (or interaction i of the various factors used in the
sample experimentation (Kenneth P. Uhl, 1962).
It is multiplicity of variables which makes it so complex to differentiate pertinent
variations. Furthermore, the amount of variance attributed to any one factor may be
quite tiny, so that in any single case it becomes merely a matter of chance. Hence,
81
factorial design can be of considerable aid therefore it enables the researcher to base
his observations on a great number of conditions and cases, with accompanying
statistical certainty, and at the same time to disentangle the complicated causal net
(Kenneth P. Uhl, 1962).
If there are two independent variables and each of which has two levels then this
would be called a (two-by-two) 2x2 factorial design. If the two factors where each
factor has three levels then it would be a 3x2 (three by two) factorial design. It is
important that the number of distinct conditions formed by combining the levels of
the independent variables is always just the product of the numbers of levels. We can
see that in a 3x2 design distinct conditions are 6 and in a 2x2 design, four distinct
conditions therefore we can easily determine the number of different combination
groups that we have in any factorial design by multiplying through the number
notation.
Herein, we have factor of PMS and demographic variables for research design. A
level is a subdivision of a factor wherein whatever factors come from the study and
the demographic variables make factorial design for the study. Here, we consider that
factors have 9 levels and demographic variables have 2 levels (i.e male and female)
then we have 2x9 factorial designs.
82
Table-5
Demographic Variables
Gender
Male Female
Factors
F1 A1 B1
F2 A2 B2
F3 A3 B3
F4 A4 B4
F5 A5 B5
F6 A6 B6
F7 A7 B7
F8 A8 B8
F9 A9 B9
83
A level is a subdivision of a factor and demographic variables make factorial design
herein factor has 9 levels and the demographic variables have 5 levels to make
factorial design for the study. Here, we can say that we have 5x9 factorial designs.
Demographic Variables
Age
19-30 31-40 41-50 51-60
61 &
above
Factors
F1 A1 B1 C1 D1 E1
F2 A2 B2 C2 D2 E2
F3 A3 B3 C3 D3 E3
F4 A4 B4 C4 D4 E4
F5 A5 B5 C5 D5 E5
F6 A6 B6 C6 D6 E6
F7 A7 B7 C7 D7 E7
F8 A8 B8 C8 D8 E8
F9 A9 B9 C9 D9 E9
Table-6
84
A level is a subdivision of a factor and demographic variables make factorial design
herein factor has 9 levels and the demographic variables have 5 levels to make
factorial design for the study. Here, we can say that we have 5x9 factorial designs.
Demographic Variables
Education
12th &
below
Diploma &
undergraduate Graduate Postgraduate Others
Factors
F1 A1 B1 C1 D1 E1
F2 A2 B2 C2 D2 E2
F3 A3 B3 C3 D3 E3
F4 A4 B4 C4 D4 E4
F5 A5 B5 C5 D5 E5
F6 A6 B6 C6 D6 E6
F7 A7 B7 C7 D7 E7
F8 A8 B8 C8 D8 E8
F9 A9 B9 C9 D9 E9
Table-7
85
A level is a subdivision of a factor and demographic variables make factorial design
herein factor has 9 levels and the demographic variables have 4 levels to make
factorial design for the study. Here, we can say that we have 4x9 factorial designs.
Demographic Variables
Designation
Sr.Officer &
below
Asst.Manager
to Sr.Manager
Asst.GM
to Sr.GM
AVP &
above
Factors
F1 A1 B1 C1 D1
F2 A2 B2 C2 D2
F3 A3 B3 C3 D3
F4 A4 B4 C4 D4
F5 A5 B5 C5 D5
F6 A6 B6 C6 D6
F7 A7 B7 C7 D7
F8 A8 B8 C8 D8
F9 A9 B9 C9 D9
Table-8
86
A level is a subdivision of a factor and demographic variables make factorial design
herein factor has 9 levels and the demographic variables have 5 levels to make
factorial design for the study. Here, we can say that we have 5x9 factorial designs.
Demographic Variables
Years of service
Upto 5
years
6 to 10
years
11 to 15
years
16 to 20
years
21 years
& above
Factors
F1 A1 B1 C1 D1 E1
F2 A2 B2 C2 D2 E2
F3 A3 B3 C3 D3 E3
F4 A4 B4 C4 D4 E4
F5 A5 B5 C5 D5 E5
F6 A6 B6 C6 D6 E6
F7 A7 B7 C7 D7 E7
F8 A8 B8 C8 D8 E8
F9 A9 B9 C9 D9 E9
Table-9
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3.3 The Sample
Final questionnaire of total 52 items was administered to cement company’s
employees of Rajasthan and got 471 responses wherein 63 responses were partially
filled therefore only 408 respondents considered. These 408 samples are taken from
the different level of management and non-management employees from major
cement companies such as ACC, Binani Cement, Shree Cement, Ambuja Cement,
JKCement, UltraTech Cement, Mangalam Cement etc. The random sampling is done
to collect the data.
89
3.4.1 Data Collection
The data collection is used for study are mainly primary. The primary data are those,
which are collected afresh and for the first time, and thus happen to be original in
character.
In this study, primary data collected by administering questionnaire of 52 items to the
employees of the different cement companies in Rajasthan. To collect the data,
questionnaire was administered to all level of employees.
3.4.2 Data Analysis
The data, after collection, has processed and analyzed. The process implies editing,
coding, classification, and tabulation of collected data.
The statistical tools are applied for the study Factor analysis, ANOVA in this study.
3.4.2.1 Reliability and validity
Before administering the 52 items questionnaire, we checked reliability and validity
of questionnaire. To check the reliability, we found the Cronbach's Alpha value that
came .819 which shows that this instrument is reliable to use for the study.
90
Scale: ALL VARIABLES
Case Processing Summary
N %
Cases Valid 52 100.0
Excluded 0 .0
Total 52 100.0
a. List wise deletion based on all variables in
the procedure.
Reliability Statistics
Cronbach's Alpha N of Items
.819 52
Table-10
To check validity, pilot study is done. Initially questionnaire was made with 80 items
then it was given to all levels of 139 employees of cement industries wherein 18 items
were removed of less importance which were indicated by the respondents.
Thereafter, 62 items questionnaire was administered to the 37 judges who were expert
in this field wherein 10 items were indicated of less importance which were removed
from the questionnaire. Then in final questionnaire of total 52 items with 5 points
likert’s scale was administered and got 471 responses wherein 63 responses were
91
partially filled therefore only 408 respondents considered and tabulated their feedback
and SPSS is used for analysis of tabulated data. Factor analysis is done.
Questionnaire was administered to the 679 employees of all levels in different cement
companies in Rajasthan wherein 471 employees responded. Out of 471 responses,
only 408 responses were considered for analysis and rest omitted because these
omitted responses were not properly or partially filled.
3.4.3 Factor Analysis
Data collected from the 52 items questionnaire and tabulated for the analysis. For
analysis of data SPSS is used. We apply factor analysis to all 52 items for 408
respondents and principal component analysis method is used for extraction wherein
factors having 1 or more eigen value to be extracted. Varimax rotation method is used
to display the rotated solution. After applying, different table are found.
The KMO (Kaiser-Meyer-Olkin) is measure of sampling adequacy which varies from
0 to 1. The value closer to 1.00 is better and the value of .6 suggested the minimum.
Here we got 0.71 which suggests that our sample is adequate for factor analysis.
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The first table is communalities.
Communalities
Initial Extraction
Q1 1.000 .970
Q2 1.000 .683
Q3 1.000 .552
Q4 1.000 .656
Q5 1.000 .675
Q6 1.000 .827
Q7 1.000 .630
Q8 1.000 .818
Q9 1.000 .697
Q10 1.000 .699
Q11 1.000 .987
Q12 1.000 .922
Q13 1.000 .863
Q14 1.000 .666
Q15 1.000 .741
Q16 1.000 .719
Q17 1.000 .742
Q18 1.000 .660
Q19 1.000 .701
93
Q20 1.000 .725
Q21 1.000 .720
Q22 1.000 .987
Q23 1.000 .847
Q24 1.000 .975
Q25 1.000 .616
Q26 1.000 .971
Q27 1.000 .783
Q28 1.000 .763
Q29 1.000 .685
Q30 1.000 .974
Q31 1.000 .506
Q32 1.000 .715
Q33 1.000 .970
Q34 1.000 .910
Q35 1.000 .768
Q36 1.000 .678
Q37 1.000 .790
Q38 1.000 .771
Q39 1.000 .966
Q40 1.000 .903
Q41 1.000 .949
Q42 1.000 .790
Q43 1.000 .856
94
Q44 1.000 .954
Q45 1.000 .954
Q46 1.000 .942
Q47 1.000 .925
Q48 1.000 .921
Q49 1.000 .969
Q50 1.000 .877
Q51 1.000 .911
Q52 1.000 .969
Extraction Method: Principal Component
Analysis.
Table-11
Communalities:
Communalities table shows that how much of the variance in the variables has been
accounted for by the extracted factors. The communalities explains that what
proportion of each variable’s variance is shared with the factors which have been
created. The first column of communalities shows components or items or variables
that have been used which are 52. The second column initial, when principal
component analysis method is used then communalities initial value always comes
1.00. The third column extracted shows, how much variance each variable has in
common with the variables that we kept. In our table, for instance we find .970
extracted values in Q1 which means 97% of the variance in Q1 is accounted for and if
we see Q8 then its extracted value is .818 means 81.8% of the variance in Q8 is
accounted for. The principal component communalities (extraction, as the initial are
always 1.00) ranging from .506 to .987, thus most of the variance of these variables is
accounted for by these factor solution.
95
If a variable does not share much variance with the other variables or with the
retained factors or variables (i.e very less extracted value) then it is unlikely to be
useful in defining a factor.
In our communalities table, we have high variance of each variable therefore we take
all the listed items.
Total Variance Explained
Component
Initial Eigen values Extraction Sums of Squared Loadings Rotation Sums of Squared Loadings
Total
% of
Variance
Cumulative
% Total
% of
Variance
Cumulative
% Total
% of
Variance
Cumulative
%
1 13.887 26.705 26.705 13.887 26.705 26.705 12.664 24.355 24.355
2 11.019 21.191 47.896 11.019 21.191 47.896 6.823 13.121 37.475
3 5.744 11.047 58.943 5.744 11.047 58.943 5.928 11.399 48.875
4 3.910 7.518 66.462 3.910 7.518 66.462 5.066 9.742 58.616
5 2.675 5.145 71.607 2.675 5.145 71.607 3.702 7.120 65.736
6 1.471 2.829 74.435 1.471 2.829 74.435 3.680 7.076 72.812
7 1.328 2.554 76.989 1.328 2.554 76.989 1.586 3.049 75.862
8 1.135 2.182 79.171 1.135 2.182 79.171 1.429 2.749 78.611
9 1.079 2.074 81.246 1.079 2.074 81.246 1.370 2.635 81.246
10 .946 1.819 83.064
11 .858 1.650 84.715
12 .763 1.467 86.182
13 .673 1.295 87.476
14 .638 1.227 88.704
15 .596 1.146 89.849
16 .584 1.124 90.973
17 .534 1.028 92.001
18 .469 .903 92.904
19 .413 .794 93.698
20 .392 .753 94.451
21 .362 .696 95.147
22 .341 .655 95.802
23 .323 .621 96.423
24 .270 .519 96.942
25 .262 .503 97.445
96
26 .252 .485 97.930
27 .216 .416 98.346
28 .183 .351 98.697
29 .122 .235 98.932
30 .102 .196 99.128
31 .097 .187 99.315
32 .073 .140 99.456
33 .068 .131 99.586
34 .056 .108 99.694
35 .042 .080 99.774
36 .035 .067 99.841
37 .030 .057 99.898
38 .024 .047 99.945
39 .018 .035 99.981
40 .006 .012 99.993
41 .004 .007 100.000
42 1.016E-14 1.954E-14 100.000
43 5.794E-15 1.114E-14 100.000
44 1.844E-15 3.546E-15 100.000
45 4.332E-16 8.330E-16 100.000
46 2.730E-16 5.250E-16 100.000
47 1.426E-17 2.742E-17 100.000
48 -3.233E-18 -6.217E-18 100.000
49 -2.449E-16 -4.709E-16 100.000
50 -1.241E-15 -2.386E-15 100.000
51 -2.265E-15 -4.356E-15 100.000
52 -6.832E-15 -1.314E-14 100.000
Extraction Method: Principal Component analysis.
Table-12
97
Total Variance Explained:
Total variance explained is the total amount of variability of the original variables
explained by each factor solution. In the table of total variance explained, the first
column is component or items or variables which are used for study.
“Eigen values are the variances of the factor”
The Eigen value allows us to know how much variation each factor or component can
explain. When factor analysis is performed then how many factors to settle on is
decided according to the Eigen value
Next column is initial Eigen values, eigenvalues are the variance of the factor or
variables and the total variance is equal to the number of variables used in the analysis
which is 52 i.e the total of all eigenvalues will be the total number of factors or
variables herein the total number of variables are 52.
In the first column, the first factor will always account for the most variance (highest
Eigenvalue 13.887) and next factor will account for as much of the left over variance
as it can and so on. Hence, each successive factor or variable is accounting for less
and less variance.
In an analysis of 52 items, the initial eigenvalues show that for each of those 52
factors, how much of the variance in the 52 variables was captured by that factor.
Here would be 52 units and each factor’s Eigenvalue corresponds with some portion
of those items. If we see, the first Eigen value is 13.887 which accounts for 26.70%
(i.e 13.887/ 52) of the total items and next Eigen value is 11.019 which accounts for
21.19% (i.e 11.019/ 52) and so on.
The Eigen value rule (Kaiser,1960) asserts that factors with Eigen values less than
1.00 should not be retained therefore in this analysis, we consider the factors which
has Eigen values 1.00 or higher. The factors only be extracted when they have 1 or
more than 1 Eigen value herein 9 factors are having more than 1.00 Eigen value
therefore only 9 factors extracted and rest were omitted. This is because a factor with
Eigen value of 1 account for as much variance as a single variable or factor and that is
why only factors that explain at least the same amount of variance as a single variable
98
is worth keeping and the factors that explain the least amount of variance are
generally discarded.
The eigenvalues from 13.887 to 1.079 are considered wherein rest all values are less
than therefore these values are being omitted.
% of variance: This contains the % of total variance accounted for by each factor
here in the first value is 26.705 which means 26.205% variance is explained by this
factor. The first factor accounts for 26.205% of the variance and the second 21.191%
and so on till 2.074%, rest all remaining factors are not significant.
Cumulative %:
This column contains the cumulative % of variance accounted for by the current and
all preceding factors. Herein if we see third row which shows a value of 58.943%, it
means that the first three factors together account for 58.943% of the total variance.
Likewise, ninth row shows value 81.246% , means the all nine factors together
account for 81.246% of the total variance.
99
Rotated Component Matrixa
Component
1 2 3 4 5 6 7 8 9
Q1 .341 -.274 .008 .051 -.102 .881 .000 .048 -.076
Q2 .079 .308 .334 .127 .011 .877 .128 .162 .125
Q3 .301 .230 .061 .024 .018 .360 .875 .014 -.023
Q4 .023 .266 -.428 -.311 .175 -.117 .899 .019 .031
Q5 .402 -.036 -.064 -.064 -.019 -.116 .209 -.066 .834
Q6 .128 .098 -.233 .042 -.010 .100 -.069 .837 .031
Q7 -.248 .221 -.108 .087 -.095 -.330 .370 .801 -.333
Q8 .291 .107 .406 .256 -.088 .351 .059 .781 .075
Q9 .180 .410 -.026 .130 -.029 .079 -.079 -.029 .875
Q10 -.318 .323 .060 -.007 -.034 .821 .087 .003 -.052
Q11 .165 .073 -.164 .022 .017 .796 -.117 .009 .029
Q12 -.244 .406 .323 .381 -.133 .782 -.017 .011 .032
Q13 .219 .150 -.022 .153 .050 .395 .017 -.368 .922
100
Q14 .087 .339 -.286 -.191 .103 -.144 -.089 -.088 .934
Q15 .166 .209 -.339 .033 .045 .332 -.064 .717 .083
Q16 .416 .120 .034 .261 -.042 .401 .129 .918 .065
Q17 .147 .049 .316 -.060 .033 -.093 -.055 .886 .022
Q18 -.231 -.176 .284 -.150 -.012 .116 .053 .871 -.174
Q19 -.032 -.234 .375 .128 -.081 .086 .989 -.107 -.013
Q20 -.051 -.082 .017 .008 -.069 .776 .132 .021 .267
Q21 .111 .034 .047 .054 -.014 .771 .210 -.050 .085
Q22 -.265 -.103 .164 .242 .811 -.058 .117 -.009 -.029
Q23 .183 -.187 .323 .430 .808 .423 .036 .020 -.040
Q24 -.190 .192 -.274 -.233 .787 -.053 .030 -.031 .017
Q25 -.260 -.107 .321 -.045 .741 -.072 -.038 -.203 -.123
Q26 .274 .235 .272 .852 .317 .024 -.030 -.030 .080
Q27 .450 -.005 .417 .822 .208 .123 .020 -.030 .037
Q28 .197 -.453 .272 .277 .915 .149 .092 -.023 -.031
Q29 .367 .103 .103 .216 .908 .090 .011 .137 -.154
101
Q30 .928 .151 -.133 -.374 .136 .400 -.141 .013 -.012
Q31 .814 .110 -.293 -.226 .099 .079 .097 .237 .065
Q32 -.217 -.054 .398 .209 .044 .224 .178 .976 .101
Q33 .028 .888 .008 .051 -.102 .128 .000 .048 -.076
Q34 -.050 .873 -.209 -.143 .002 .096 -.070 -.092 .186
Q35 -.337 .856 .166 .058 -.045 .280 .062 .096 -.031
Q36 .368 .088 -.251 .982 .043 .305 -.249 .075 .074
Q37 .169 -.076 -.127 .789 .013 .404 -.404 .076 .049
Q38 -.149 .020 .940 .166 .017 .006 .075 -.071 -.333
Q39 .856 .117 -.119 -.331 .138 -.426 .209 .027 -.003
Q40 .799 -.350 .433 .211 -.127 .015 .100 .055 -.038
Q41 .407 -.238 .115 .100 -.271 .824 -.068 .440 .048
Q42 -.320 .294 .974 -.162 -.381 .356 -.131 .218 -.054
Q43 -.196 -.012 .879 -.280 .274 -.421 .165 .382 .074
Q44 -.364 -.021 .833 .237 -.258 .012 .108 .401 -.112
Q45 -.364 .998 .400 .147 -.258 .012 .108 .337 -.112
102
Q46 .078 .927 -.155 .010 .134 -.019 -.080 .322 .024
Q47 -.204 .918 .091 .289 .348 .001 .194 .181 -.116
Q48 .103 .850 -.195 -.104 .180 -.020 -.107 .227 .041
Q49 -.259 .898 -.313 -.254 -.137 -.003 .049 .164 .437
Q50 .150 .831 .112 .345 .200 -.435 .114 .085 .075
Q51 -.291 .729 .091 .220 .430 .003 .212 .349 .320
Q52 .722 .160 -.313 -.154 -.137 -.003 .049 .164 .034
Extraction Method: Principal Component
Analysis.
Rotation Method: Varimax with Kaiser
Normalization.
Table-13
103
Rotated component matrix:
In the principal component analysis output, the rotated component matrix gives the
rotated factor loadings, which represent both how the variables are weighted for each
factor and correlation of each variable with each factor. The extraction method will
produce factor loadings for every item on every extracted factor. Rotation is a way of
maximizing high loadings and minimizing low loadings so that the simplest possible
structure is achieved therefore this is considered to take factor loadings instead of
component matrix. Herein we have rotated component matrix which explains that 9
components extracted have factor loadings in each components. The relationship of
each variable to the underlying factor is expressed by the so called factor loading. As
high factor loading, shows factor association is strongest with the variable. If we see
sixth component, the factor loading of Q1 is .881 which means variable has a
correlation of 0.88 with factor and this would be considered as a strong association.
We considered factor loading which is more than 0.5 and rest omitted.
In first component, we find Q30, Q31, Q39, Q40, Q52 are having .928, .814,
.856,.799,.722 high factor loadings and rest values are having low factor loading
which can be suppressed. These 5 variables Q30, Q31, Q39, Q40, Q52 represent one
factor which can be expressed by one name.
Likewise, in second component we find Q33, Q34, Q35, Q45, Q46, Q47, Q48, Q49,
Q50, Q51 are having .888, .873, .856, .998, .927, .918, .850 .898, .831, .729 high
factor loadings these 9 variables will be represented by one factor.
Likewise, in third component we find from Q38, Q42, Q43, Q44 are having 940, .974,
.879, .833 high factor loadings these 4 variables will be represented by one factor.
Likewise, in forth component we find from Q26, Q27, Q36, Q37 are having .852,
.822, .982, .789 high factor loadings these 4 variables will be represented by one
factor.
104
Likewise, in fifth component we find from Q22, Q23, Q24, Q25, Q28, Q29 are having
.811, .808, .787, .741, .915, .908 high factor loadings these 6 variables will be
represented by one factor.
Likewise, in sixth component we find from Q1, Q2, Q10, Q11, Q12, Q20, Q21, Q41
are having .881, .877, .821, .796, .782, .776, .771, .824 high factor loadings these 8
variables will be represented by one factor.
Likewise, in seventh component we find from Q3, Q4, Q19 are having .875, .899,
.989 high factor loadings these 3 variables will be represented by one factor.
Likewise, in eighth component we find from Q6, Q7, Q8, Q15, Q16, Q17, Q18, Q32
are having .837, .801, .781, .717, .918, .886, .871, .976, high factor loadings these 8
variables will be represented by one factor.
Likewise, in ninth component we find from Q5, Q9, Q13, Q14 are having .834, .875,
.922, .934 high factor loadings these 4 variables will be represented by one factor.
Herein 52 items are reduced and came as 9 factors.
ANOVA
We have taken level of significance α = 0.05 and p is the significance value. If p ≤ α
then null hypothesis to be rejected and if p > α the null hypothesis to be accepted.
To analyze the data, first we compute the means of group and then run the ANOVA
because there are 3 or more groups. To run ANOVA, we assume that each group is
approximately normal and the population is normally distributed. ANOVA is used by
comparing means to determine if the means are statistically different.
We run one way ANOVA in SPSS with factors and demographic variables. In
analysis table, the significance value help to determine if condition means were
105
relatively the same of if they were significantly different from one another. If sig.
value is greater than 0.05 then there is no statistically significant difference and if sig.
value is less than 0.05 then there is a statistically significant in the means.
In ANOVA result table, F values in the column shows ratio of two mean square
values. Whenever null hypothesis is true, F value is expected to have a value close to
1.00 most of the time and if a large F ratio means that the variation among group
means is more i.e a large value of F indicates relatively more difference between
groups than within groups.
106
Mean
Gender
Male Female
Mean Mean
Goal 3.45 3.50
Career planning 2.55 2.62
Compensation 2.92 3.03
Role 3.35 3.47
Review 3.13 3.19
Feedback
Reward
Benefits
Work freedom
2.54
2.31
2.61
2.90
2.47
2.37
2.54
2.81
Table-14
107
One way ANOVA
Sum of Squares df Mean Square F Sig.
Goal Between Groups .038 1 .038 1.044 .307
Within Groups 14.892 406 .037
Total 14.930 407
Career planning Between Groups .078 1 .078 1.995 .159
Within Groups 15.920 406 .039
Total 15.998 407
Compensation Between Groups .186 1 .186 1.938 .165
Within Groups
Total
39.029
39.216
406
407
.096
Role Between Groups .273 1 .273 3.716 .055
Within Groups 29.880 406 .074
Total 30.154 407
Review Between Groups .062 1 .062 1.186 .277
108
Within Groups 21.185 406 .052
Total 21.247 407
Feedback Between Groups .095 1 .095 2.187 .140
Within Groups 17.560 406 .043
Total 17.654 407
Reward Between Groups .054 1 .054 1.123 .290
Within Groups 19.393 406 .048
Total 19.447 407
Benefits Between Groups
Within Groups
Total
.075
7.821
7.896
1
406
407
.075
.019
3.894
.049
Work freedom Between Groups .143 1 .143 1.819 .178
Within Groups 31.978 406 .079
Total 32.121 407
Table-15
109
A one way ANOVA is conducted to compare the effect of factors on gender wherein
result shows
1. In benefits row the p value is 0.049 which is less than 0.05 and the F value is
3.894. It means that there is statistically significant difference in means. In this
case null hypothesis is rejected and alternative hypothesis is accepted.
2. If we see other factors such as goal, career planning, compensation, role of
supervisor, performance review, feedback, reward and recognition and work
freedom, these p values are greater than 0.05 and their most of them F values
are approximately near to the 1.00. It means that there is no statistically
significant difference in means therefore in this case null hypothesis is
accepted and alternative hypothesis is rejected.
110
Mean
Age
19-30 31-40 41-50 51-60 61+
Mean Mean Mean Mean Mean
Goal 3.47 3.42 3.49 3.43 3.50
Career planning 2.54 2.52 2.60 2.58 2.75
Compensation 2.95 2.86 2.96 2.94 3.00
Role 3.36 3.34 3.33 3.37 3.38
Review 3.12 3.10 3.17 3.16 3.25
Feedback 2.53 2.53 2.56 2.51 2.78
Reward 2.31 2.32 2.28 2.36 2.17
Benefits 2.61 2.60 2.57 2.62 2.62
Work freedom 2.90 2.92 2.86 2.86 2.75
Table-16
111
One Way ANOVA
Sum of Squares df Mean Square F Sig.
Goal Between Groups .267 4 .067 1.835 .121
Within Groups 14.663 403 .036
Total 14.930 407
Career planning Between Groups .438 4 .110 2.837 .024
Within Groups 15.560 403 .039
Total 15.998 407
Compensation Between Groups .654 4 .163 1.708 .147
Within Groups 38.562 403 .096
Total 39.216 407
Role Between Groups .049 4 .012 .165 .956
Within Groups 30.104 403 .075
Total 30.154 407
Review Between Groups .295 4 .074 1.416 .228
112
Within Groups 20.952 403 .052
Total 21.247 407
Feedback Between Groups .322 4 .080 1.871 .115
Within Groups 17.332 403 .043
Total 17.654 407
Reward Between Groups .235 4 .059 1.234 .296
Within Groups 19.211 403 .048
Total 19.447 407
Benefits Between Groups .089 4 .022 1.144 .336
Within Groups 7.807 403 .019
Total 7.896 407
Work freedom Between Groups .290 4 .072 .917 .454
Within Groups 31.832 403 .079
Total 32.121 407
Table-17
113
A one way ANOVA is conducted to compare the effect of factors on age wherein
result shows
1 In career planning row the p value is 0.024 which is less than 0.05 and the F
value is 2.837. It means that there is statistically significant difference in
means. In this case null hypothesis is rejected and alternative hypothesis is
accepted.
2 If we see other factors such as goal, compensation, role of supervisor,
performance review, feedback, reward and recognition, benefits and work
freedom, these p values are greater than 0.05 and their most of them F values
are approximately near to the 1.00. It means that there is no statistically
significant difference in means therefore in this case null hypothesis is
accepted and alternative hypothesis is rejected.
114
Mean
Education
12th and below
Diploma &
undergraduate Graduate Postgraduate Others
Mean Mean Mean Mean Mean
Goal 3.42 3.44 3.46 3.48 3.44
Career planning
Compensation
Role
Review
Feedback
Reward
Benefits
Work freedom
2.52
2.94
3.38
3.09
2.56
2.33
2.56
2.94
2.57
2.93
3.40
3.13
2.54
2.30
2.61
2.88
2.55
2.93
3.33
3.13
2.52
2.33
2.61
2.88
2.55
2.90
3.37
3.13
2.55
2.28
2.62
2.91
2.60
3.05
3.05
3.07
2.58
2.40
2.40
2.90
Table-18
115
One way ANOVA
Sum of Squares df Mean Square F Sig.
Goal Between Groups .113 4 .028 .772 .544
Within Groups 14.817 403 .037
Total 14.930 407
Career planning Between Groups .108 4 .027 .684 .603
Within Groups
Total
15.890
15.998
403
407
.039
Compensation Between Groups .142 4 .035 .366 .833
Within Groups 39.074 403 .097
Total 39.216 407
Role Between Groups .820 4 .205 2.817 .025
Within Groups 29.334 403 .073
Total 30.154 407
Review Between Groups .081 4 .020 .384 .820
116
Within Groups
Total
21.166
21.247
403
407
.053
Feedback Between Groups .111 4 .028 .637 .636
Within Groups 17.543 403 .044
Total 17.654 407
Reward Between Groups
Within Groups
Total
.209
19.238
19.447
4
403
407
.052
.048
1.094
.359
Benefits Between Groups .335 4 .084 4.459 .002
Within Groups 7.561 403 .019
Total 7.896 407
Work freedom Between Groups .127 4 .032 .399 .809
Within Groups 31.994 403 .079
Total 32.121 407
Table-19
117
A one way ANOVA is conducted to compare the effect of factors on education
wherein result shows
1 In role of supervisor row the p value is 0.025 and F value is 2.817, in benefits
row the p value is 0.002 and F value is 4.459 herein all p values are less than
0.05. It means that there is statistically significant difference in means. In this
case null hypothesis is rejected and alternative hypothesis is accepted.
2 If we see other factors such as goal, compensation, career planning,
performance review, feedback, reward and recognition and work freedom,
these p values are greater than 0.05 and their most of them F values are
approximately near to the 1.00. It means that there is no statistically significant
difference in means therefore in this case null hypothesis is accepted and
alternative hypothesis is rejected.
118
Mean
Designation
Sr.officer & below
Asst.Manager to
Sr.Manager Asst.GM to Sr.GM AVP & above
Mean Mean Mean Mean
Goal 3.46 3.44 3.46 3.42
Career planning 2.57 2.53 2.53 2.66
Compensation 2.96 2.88 2.93 3.14
Role 3.36 3.35 3.30 3.43
Review 3.13 3.13 3.08 3.23
Feedback 2.55 2.52 2.56 2.40
Reward 2.30 2.33 2.32 2.39
Benefits 2.59 2.61 2.62 2.62
Work freedom 2.88 2.89 2.94 2.80
Table-20
119
One way ANOVA
Sum of Squares df Mean Square F Sig.
Goal Between Groups .054 3 .018 .491 .689
Within Groups 14.876 404 .037
Total 14.930 407
Career planning Between Groups .357 3 .119 3.072 .028
Within Groups 15.641 404 .039
Total 15.998 407
Compensation Between Groups 1.077 3 .359 3.803 .010
Within Groups 38.139 404 .094
Total 39.216 407
Role Between Groups .212 3 .071 .953 .415
Within Groups 29.942 404 .074
Total 30.154 407
Review Between Groups .225 3 .075 1.444 .230
120
Within Groups 21.021 404 .052
Total 21.247 407
Feedback Between Groups .369 3 .123 2.879 .036
Within Groups 17.285 404 .043
Total 17.654 407
Reward Between Groups .188 3 .063 1.318 .268
Within Groups 19.258 404 .048
Total 19.447 407
Benefits Between Groups .047 3 .016 .802 .493
Within Groups 7.849 404 .019
Total 7.896 407
Work freedom Between Groups .237 3 .079 1.002 .392
Within Groups 31.884 404 .079
Total 32.121 407
Table-21
121
A one way ANOVA is conducted to compare the effect of factors on designation
wherein result shows
1 In career planning row the p value is 0.028 and F value is 3.072, in
compensation row the p value is 0.010 and F value is 3.803, in feedback row
the p value is 0.036 and F value is 2.879 herein all p values are less than 0.05.
It means that there is statistically significant difference in means. In this case
null hypothesis is rejected and alternative hypothesis is accepted.
2 If we see other factors such as goal, performance review, role of supervisor,
reward and recognition, benefits and work freedom, these p values are greater
than 0.05 and their most of them F values are approximately near to the 1.00.
It means that there is no statistically significant difference in means therefore
in this case null hypothesis is accepted and alternative hypothesis is rejected.
122
Mean
Years of service
Upto 5 6 to 10 11 to 15 16 to 20 21 and above
Mean Mean Mean Mean Mean
Goal 3.45 3.46 3.46 3.41 3.46
Career planning 2.52 2.58 2.57 2.56 2.43
Compensation 2.92 2.92 2.97 2.97 2.71
Role 3.37 3.34 3.34 3.38 3.18
Review 3.11 3.14 3.13 3.17 3.07
Feedback 2.54 2.54 2.53 2.54 2.55
Reward 2.33 2.31 2.32 2.33 2.24
Benefits 2.61 2.59 2.60 2.62 2.61
Work freedom 2.93 2.86 2.90 2.87 2.93
Table-22
123
One way ANOVA
Sum of Squares df
Mean
Square F Sig.
Goal Between Groups .064 4 .016 .437 .782
Within Groups 14.866 403 .037
Total 14.930 407
Career planning Between Groups .344 4 .086 2.214 .067
Within Groups 15.654 403 .039
Total 15.998 407
Compensation Between Groups .532 4 .133 1.385 .238
Within Groups 38.684 403 .096
Total 39.216 407
Role Between Groups .342 4 .085 1.155 .330
Within Groups 29.812 403 .074
Total 30.154 407
Review Between Groups .100 4 .025 .476 .753
124
Within Groups 21.147 403 .052
Total 21.247 407
Feedback Between Groups .003 4 .001 .016 .999
Within Groups 17.651 403 .044
Total 17.654 407
Reward Between Groups .069 4 .017 .358 .838
Within Groups 19.378 403 .048
Total 19.447 407
Benefits Between Groups .050 4 .012 .639 .635
Within Groups 7.846 403 .019
Total 7.896 407
Work freedom Between Groups .340 4 .085 1.077 .367
Within Groups 31.781 403 .079
Total 32.121 407
Table-23
125
A one way ANOVA is conducted to compare the effect of factors on years of service
wherein result shows
1 If we see all factors such as goal, career planning, performance review,
compensation, role of supervisor, reward and recognition, feedback, benefits
and work freedom, these p values are greater than 0.05 and their most of them
F values are approximately near to the 1.00 or less. It means that there is no
statistically significant difference in means therefore in this case null
hypothesis is accepted and alternative hypothesis is rejected.
128
To collect data from the employees of cement companies, one measurement
instrument is prepared. Reliability of measurement tool signifies the consistency. To
check the reliability of this instrument, SPSS is used to find out the cronbach’s alpha
which confirms the reliability of scale. Cronbach’s alpha value is measured which
was 0.819 therefore instrument was reliable for collecting data and study.
Quantitative study pertaining to performance management system of cement
companies is done wherein important factors have been identified. Data analysis is the
process of analyze data wherein data collected from 408 respondents from various
level of cement companies in Rajasthan is analyzed with the help of SPSS.
Initially, the data analysis inculcates factor analysis then ANOVA is used. Factor
analysis is used to reduce the total items and identify main factors i.e it reduces large
number of variables in less number of main factors. This factor analysis is performed
on the basis of principal component analysis and varimax rotation. While performing
factor analysis, it was decided to have extracted factors those who are having Eigen
value 1 or more than 1.
Factor analysis gives different tables of result.
The first table is communalities.
Communalities: Communalities table shows that how much of the variance in the
variables has been accounted for by the extracted factors.
The principal component communalities (extraction, as the initial are always 1.00)
ranging from .506 to .987, thus most of the variance of these variables is accounted
for by these factor solution.
If a variable does not share much variance with the other variables or with the
retained factors or variables (i.e very less extracted value) then it is unlikely to be
useful in defining a factor.
In our communalities table, high variance of each variable therefore we took all the
listed items for study.
129
Total Variance Explained:
Total variance explained is the total amount of variability of the original variables
explained by each factor solution. In the table of total variance explained, the first
column is component or items or variables which are used for study.
In an analysis of 52 items, the initial Eigenvalues show that for each of those 52
factors, how much of the variance in the 52 variables was captured by that factor.
Here would be 52 units and each factor’s Eigenvalue corresponds with some portion
of those items. If we see, the first Eigen value is 13.887 which accounts for 26.70%
(i.e 13.887/ 52) of the total items and next Eigen value is 11.019 which accounts for
21.19% (i.e 11.019/ 52) and so on.
we consider the factors which has Eigen values 1.00 or higher. The factors only be
extracted when they have 1 or more than 1 Eigen value herein 9 factors are having
more than 1.00 Eigen value therefore only 9 factors extracted and rest were omitted.
This is because a factor with Eigen value of 1 account for as much variance as a
single variable or factor and that is why only factors that explain at least the same
amount of variance as a single variable is worth keeping and the factors that explain
the least amount of variance are generally discarded.
The eigenvalues from 13.887 to 1.079 are considered wherein rest all values are less
than therefore these values are being omitted.
Rotated component matrix:
In the principal component analysis output, the rotated component matrix gives the
rotated factor loadings, which represent both how the variables are weighted for each
factor and correlation of each variable with each factor. The extraction method
produced factor loadings for every item on every extracted factor.
Herein we have rotated component matrix which explains that 9 components
extracted have factor loadings in each components. As high factor loading, shows
factor association is strongest with the variable. The factor has low factor loading i.e
less than 0.5 was not taken.
In first component, we find Q30, Q31, Q39, Q40, Q52 are having .928, .814,
.856,.799,.722 high factor loadings and rest values are having low factor loading
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which can be suppressed. These 5 variables Q30, Q31, Q39, Q40, and Q52 represent
one factor which can be expressed by one named factor. This is named “Goal
Setting”.
Likewise, in second component we find Q33, Q34, Q35, Q45, Q46, Q47, Q48, Q49,
Q50, Q51 are having .888, .873, .856, .998, .927, .918, .850 .898, .831, .729 high
factor loadings these 9 variables represent one factor which is expressed by one
named factor called “Career planning and appraisal system”.
Likewise, in third component we find from Q38, Q42, Q43, Q44 are having 940, .974,
.879, .833 high factor loadings these 4 variables represent one factor which is
expressed by one named factor called “Compensation”.
Likewise, in forth component we find from Q26, Q27, Q36, Q37 are having .852,
.822, .982, .789 high factor loadings these 4 variables represent one factor which is
expressed by one named factor called “Role of supervisor”.
Likewise, in fifth component we find from Q22, Q23, Q24, Q25, Q28, Q29 are having
.811, .808, .787, .741, .915, .908 high factor loadings these 6 variables represent one
factor which is expressed by one named factor called “Performance review”.
Likewise, in sixth component we find from Q1, Q2, Q10, Q11, Q12, Q20, Q21, Q41
are having .881, .877, .821, .796, .782, .776, .771, .824 high factor loadings these 8
variables represent one factor which is expressed by one named factor called
“Learning and feedback”.
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Likewise, in seventh component we find from Q3, Q4, Q19 are having .875, .899,
.989 high factor loadings these 3 variables represent one factor which is expressed by
one named factor called “Reward and recognition”.
Likewise, in eighth component we find from Q6, Q7, Q8, Q15, Q16, Q17, Q18, Q32
are having .837, .801, .781, .717, .918, .886, .871, .976, high factor loadings these 8
variables represent one factor which is expressed by one named factor called
“Personal benefits”.
Likewise, in ninth component we find from Q5, Q9, Q13, Q14 are having .834, .875,
.922, .934 high factor loadings these 4 variables represent one factor which is
expressed by one named factor called “Work freedom”.
Herein 52 items are reduced and came as 9 factors.
Final Result : These core 9 factors Goal setting, career planning and appraisal
system, compensation, role of supervisor, performance review, learning and feedback,
reward and recognition, personal benefits and work freedom are identified by doing
this study that they are highly important for the cement companies.
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ANOVA
To check our hypotheses, we run ANOVA that which of the hypotheses are true. We
have taken level of significance α = 0.05 and p is the significance value. If p ≤ α then
null hypothesis to be rejected and if p > α the null hypothesis to be accepted.
We run one way ANOVA in SPSS with factors and demographic variables. In
analysis table, the significance value help to determine if condition means were
relatively the same of if they were significantly different from one another. If sig.
value is greater than 0.05 then there is no statistically significant difference and if sig.
value is less than 0.05 then there is a statistically significant in the means.
In ANOVA result table, F values in the column shows ratio of two mean square
values. Whenever null hypothesis is true, F value is expected to have a value close to
1.00 most of the time and if a large F ratio means that the variation among group
means is more i.e a large value of F indicates relatively more difference between
groups than within groups.
A one way ANOVA is conducted to compare the effect of factors on gender wherein
result shows
1 In personal benefits row the p value is 0.049 which is less than 0.05 and the F
value is 3.894. It means that there is statistically significant difference in
means. In this case null hypothesis is rejected and alternative hypothesis is
accepted.
2 If we see other factors such as goal, career planning, compensation, role of
supervisor, performance review, feedback, reward and recognition and work
freedom, these p values are greater than 0.05 and their most of them F values
are approximately near to the 1.00. It means that there is no statistically
significant difference in means therefore in this case null hypothesis is
accepted and alternative hypothesis is rejected.
For personal benefit factor p value is less than 0.05 therefore null hypothesis is
rejected and alternative hypothesis is accepted but rest of these factors we
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have p value is more than .05 herein the null hypothesis is accepted and
alternate hypothesis is rejected. Eventually, for personal benefit factor gender
has significant difference whereas rest factors do not have any significant
difference for gender. Except personal benefit factor, factors of PMS have
same significance for any of the gender i.e either male or female, they have
same significance.
A one way ANOVA is conducted to compare the effect of factors on age wherein
result shows
1. In career planning row the p value is 0.024 which is less than 0.05 and the F
value is 2.837. It means that there is statistically significant difference in
means. In this case null hypothesis is rejected and alternative hypothesis is
accepted.
2. If we see other factors such as goal, compensation, role of supervisor,
performance review, feedback, reward and recognition, personal benefits and
work freedom, these p values are greater than 0.05 and their most of them F
values are approximately near to the 1.00. It means that there is no statistically
significant difference in means therefore in this case null hypothesis is
accepted and alternative hypothesis is rejected.
For career planning factor p value is less than 0.05 therefore null hypothesis is
rejected and alternative hypothesis is accepted but rest of these factors we
have p value is more than .05 herein the null hypothesis is accepted and
alternate hypothesis is rejected. Eventually, for career planning factor age has
significant difference whereas rest factors do not have any significant
difference for age. Except career planning factor, factors of PMS have same
significance for any of the age i.e for any age, they have same significance.
A one way ANOVA is conducted to compare the effect of factors on education
wherein result shows
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1 In role of supervisor row the p value is 0.025 and F value is 2.817, in personal
benefits row the p value is 0.002 and F value is 4.459 herein all p values are
less than 0.05. It means that there is statistically significant difference in
means. In this case null hypothesis is rejected and alternative hypothesis is
accepted.
2 If we see other factors such as goal, compensation, career planning,
performance review, feedback, reward and recognition and work freedom,
these p values are greater than 0.05 and their most of them F values are
approximately near to the 1.00. It means that there is no statistically significant
difference in means therefore in this case null hypothesis is accepted and
alternative hypothesis is rejected.
For role of supervisor and personal benefits factors p value is less than 0.05
therefore null hypothesis is rejected and alternative hypothesis is accepted but
rest of these factors we have p value is more than .05 herein the null
hypothesis is accepted and alternate hypothesis is rejected. Eventually, for role
of supervisor and personal benefits factors, education has significant
difference whereas rest factors do not have any significant difference for
education. Except role of supervisor and personal benefits factors, factors of
PMS have same significance for any of the education i.e for any education,
they have same significance.
A one way ANOVA is conducted to compare the effect of factors on designation
wherein result shows
1 In career planning row the p value is 0.028 and F value is 3.072, in
compensation row the p value is 0.010 and F value is 3.803, in feedback row
the p value is 0.036 and F value is 2.879 herein all p values are less than 0.05.
It means that there is statistically significant difference in means. In this case
null hypothesis is rejected and alternative hypothesis is accepted.
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2 If we see other factors such as goal, performance review, role of supervisor,
reward and recognition, benefits and work freedom, these p values are greater
than 0.05 and their most of them F values are approximately near to the 1.00.
It means that there is no statistically significant difference in means therefore
in this case null hypothesis is accepted and alternative hypothesis is rejected.
For career planning, compensation and feedback factors p value is less than
0.05 therefore null hypothesis is rejected and alternative hypothesis is
accepted but rest of these factors we have p value is more than .05 herein the
null hypothesis is accepted and alternate hypothesis is rejected. Eventually, for
career planning, compensation and feedback factors, designation has
significant difference whereas rest factors do not have any significant
difference for designation. Except career planning, compensation and
feedback factors, factors of PMS have same significance for any of the
designation i.e for any designation, they have same significance.
A one way ANOVA is conducted to compare the effect of factors on years of service
wherein result shows
1 If we see all factors such as goal, career planning, performance review,
compensation, role of supervisor, reward and recognition, feedback, benefits
and work freedom, these factor’s p values are greater than 0.05 and their most
of them F values are approximately near to the 1.00 or less. It means that there
is no statistically significant difference in means therefore in this case null
hypothesis is accepted and alternative hypothesis is rejected.
Eventually, for every factor of PMS does not have any significant difference
for designation i.e for any year of service, they have same significance.
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Final Result:
If we see that only personal benefits, career planning, role of supervisor,
compensation and feedback factor have significant difference with demographic
variables but rest factors goal setting, performance review, reward and recognition
and work freedom do not have significant difference with demographic variable.
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Performance management is very important aspect of human resource management
for any organization. In India, development is taking place very fast in recent years
therefore cement companies are being evaluated most important companies. Cement
companies must have effective performance management system, if cement
companies are having performance management system then it must be reviewed to
see the effectiveness of the system. In years back, performance appraisal system was
in use wherein ratings were given to the employees, once in a year or twice in a year.
Now it has been transformed in performance management system wherein continuous
monitoring and improvement of employees are to be recorded. Therefore this study is
done for performance management system of cement companies instead of
performance appraisal system.
The researcher found in the literature review that many studies are done on
performance management system of different companies in India and abroad. In these
studies, different factors were found (i.e goal setting, fairness of appraisal system,
feedback, merit pay etc) for different organizations that were having importance for
them. These factors were generally not more than 3 to 4 for any organization whereas
in this study, nine factors of PMS i.e goal, career planning, performance review,
compensation, role of supervisor, reward and recognition, feedback, benefits and
work freedom are having importance for the cement companies. It clearly indicates
that either cement companies performance management system is not effective or
system is missing. These factors required proper implementation to the cement
companies those who are not having PMS and if cement companies have already
PMS system then these factors must be considered.
The important nine factors are:
Goal setting: It is the initial stage of performance planning wherein organization and
department goals and objectives must be clearly defined and easy to understand by the
employee. It decides inputs and corresponding output by the employee as well as fixes
accountability of employee for the tasks, assigned to them.
Career planning and appraisal system: Career planning system must be clearly
defined to the employees and appraisal system must be clearly defined and
documented as well as easy to understand by the employees.
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Compensation: Pay and promotion decisions must be linked with the performance
achievements.
Role of supervisor: Supervisors must be able to handle performance the performance
of subordinate and must be concentrating on managing performance rather than
controlling.
Performance review: Performance review is for employee to develop and grow
therefore performance review must be done periodically and continuous interaction of
supervisor with employee. The review must be based on factors previously agreed
upon. There must be system defined to observe and fill the competency gap.
Learning and Feedback: Learning is the continuous process which must be at work
place as well as outside from the organization because technology is developing very
fast and competitiveness is being increased every day. Continuous learning make
employee up to date with current scenario and this gives employee to develop new
competencies and grow. Therefore, there must be a system for indentify training
needs. Feedback is mirror to show employee performance therefore continuous
feedback must be given as soon as activity is performed.
Reward and recognition: There must be clearly defined system for reward and
recognition of employees for their motivation.
Personal benefits: Job security is the major concern for every employee therefore it
must be clearly defined. Work life balance, basic amenities etc are the major
concerned which are to be taken care.
Work freedom: Work autonomy, participative decision making and value of ideas
can be entertained to some extent wherever required.
After determining the important PMS factors, we analyzed their relation with
demographic data wherein it has been found that most of the factors are not having
much significant difference with gender, age, education, designation and year of
service therefore PMS factors do not have much significance for gender, age etc. It
does not affect that what gender you are or what age you are but the factors are
important for cement company’s PMS.
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This extensive study is done to know the important factors of performance
management system for cement companies in Rajasthan and these important factors
have any significance on demographic variables, used for the study. Based on overall
study, researcher has strong opinion that these implication and suggestions will help
to the cement companies at the time of introduction and implementation of
performance management system. If PMS is already implemented then this can make
improvement in their performance management system.
After factor analysis, we have identified the core important factors which are goal
setting, career planning and appraisal system, compensation, role of supervisor,
performance review, learning and feedback, reward and recognition, personal benefits
and work freedom. These factors are important for the cement companies and
acceptance of these results will make the cement company’s performance
management system more effective when they enable these PMS factors in their
organization and they can achieve better than the present.
By literature review, it has been found that in Indian and international organizations
there are some (i.e 2, 3 factors) factors which were important to be implemented or to
be introduced. Herein, 9 important factors found i.e goal setting, career planning and
appraisal system, compensation, role of supervisor, performance review, learning and
feedback, reward and recognition, personal benefits and work freedom which shows
that cement companies are required to see their performance management system.
Because any of the company who is lacking with these important aspects of PMS then
they must review their performance management system.
This study suggests to cement companies of Rajasthan to review their performance
management system and if they are lacking with these factors then introduction is
required for effective PMS. In case, cement companies are having these factors in
their PMS then they must review their PMS and do effective implementation.
If any cement company is having performance appraisal system then it can be
transformed from performance appraisal to performance management system with
these important PMS factors for effective PMS system.
These PMS factors are useful for cement companies as well as academicians wherein
academicians can go for further research and can suggest other important aspects.
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When these important PMS factors were analyzed with demographic variables then
result shows that most of the factors are not having much significant difference with
gender, age, education, designation and year of service therefore researcher suggests
that PMS factors do not have much significance for gender, age etc. It does not affect
that, what gender you are or what age you are but the factor is important for cement
company’s PMS.
This study helps to cement industries, academicians, researchers etc. In cement
industry, with increasing competition and paradigm shift, strategic decisions are very
important therefore top management are required to consider factors of PMS in their
strategic decisions. Middle and lower management employees will be benefitted with
low attrition rate, high motivation and job satisfaction that will lead to increase
employee productivity. In academic courses like MBA, MHRM etc, these findings
can be imparted for practical approach with the text. Researchers can take forward
this research to Indian or international context.
The future research can be done in Indian or global context of performance
management system for cement companies.
Future research can be done in Rajasthan with the context of factors of human
resource management systems in cement companies, to have broader view.