A PROJECT REPORT ON

PERFORMANCE APPRAISAL IN WNS

SUBMITTED BY
TEHSEEN HANIF ANSARI
ROLL NO-15004
M.COM- SEM-I
(BUSINESS MANAGEMENT)
ACADEMIC YEAR: 2014-15

PROJECT GUIDE
MRS.SONI HASSANI

SUBMITTED TO
UNIVERSITY OF MUMBAI
MULUND COLLEGE OF COMMERCE
S.N ROAD, MULUND (WEST)
MUMBAI 4000080.

DECLARATION
I, TEHSEEN HANIF ANSARI, ROLL NO 15004, STUDENT OF MULUND COLLEGE OF
COMMERCE,S.N ROAD, MULUND (WEST), MUMBAI 400080 STUDYING IN M.COM
PART-I

HEREBY DECLARE THAT I HAVE COMPLETED THE PROJECT ON

PERFORMANCE APPRAISAL IN WNS UNDER THE GUIDANCE OF PROJECT

GUIDE PROF.MR. SHIVAJI PAWAR DURING THE ACADEMIC YEAR 2014-2015.THE
INFORMATION SUBMITTED IS TRUE AND ORIGINAL TO THE BEST OF MY
KNOWLEDGE.

DATE:
PLACE:
SIGNATURE:

CERTIFICATE
I, PROF.MRS.SONI HASSANI hereby certify that MISS TEHSEEN HANIF ANSARI, ROLL
NO.15004 of Mulund College Of Commerce, S.N Road, Mulund (West),Mumbai-400080 of
M.Com Part-I (Business Management) has completed her project on PERFORMANCE
APPRAISAL IN WNS during the academic year 2014-2015.The information submitted is true
and original to the best of my knowledge.

PROJECT GUIDE

COURSE CO-ORDINATOR
DATE:

PRINCIPAL

EXTERNAL GUIDE

ACKNOWLEDGEMENT

I, Tehseen Hanif Ansari would like to express my sincere gratitude to the principal of Mulund
College of Commerce Dr Mrs. Parvathi Venkatesh, Course Co-ordinator and our project guide
Mrs Soni Hassani, for providing me an opportunity to do my project work on PERFORMANCE
APPRAISAL IN WNS Special thanks to library in charge, which provided the necessary books
and other data which acted as stepping stone in my project and also those who have directly or
indirectly helped me in project for their encouragement and timely help.
Last but not the least, I wish to avail myself of this opportunity, to express a sense of gratitude
and love to my friends and my beloved parents for their help and support.

PREFACE
OBJECTIVES

To study the performance appraisal of employees at WNS.

To study the purpose of performance appraisal conducted at WNS.
To understand the opinion of employees towards performance appraisal at
WNS.
To identity the effect of performance appraisal on individual and
organizational development.
To understand the existing relationship between management and
employees.
To identify ways to improve the existing performance appraisal system.

INDEX

Sr.No

Topic

Pg.No

Chap 1

Introduction to HRM

1-2

1.1

History of HRM

3-4

1.2

Scope of HRM

5-6

Chap 2

Introduction of Performance Appraisal

7-8

2.1

Importance of Performance Appraisal

9-11

2.2

Process of Performance Appraisal

12-14

2.3

Techniques of Performance Appraisal

15-20

2.4

Benefits and Limitations of Performance Appraisal

21-24

Chap 3

Performance Appraisal in WNS

25-27

3.1

Introduction to the company

28

3.2

WNS Services

29-30

3.3

Performance Appraisal technique used by WNS

31-32

Chap 4

Suggestions to improve performance Appraisal in a

33-34

company
Chap 5

Conclusion
Webliography
Bibliography

35

CHAPTER 1-INTRODUCTION TO HUMAN RESOURCE

MANAGEMENT

Human Resource Management (HRM or simply HR) is a function in organizations designed

to maximize employee performance in service of their employers strategic objectives. HR is
primarily concerned with how people are managed within organizations, focusing on policies and
systems. HR departments and units in organizations are typically responsible for a number of
activities, including employee recruitment, training and development, performance appraisal, and
rewarding (e.g., managing pay and benefit systems). HR is also concerned with industrial
relations, that is, the balancing of organizational practices with regulations arising from
collective bargaining and governmental laws.
HR is a product of the human relations movement of the early 20th century, when researchers
began documenting ways of creating business value through the strategic management of the
workforce.

The

function

was

as payroll and benefits administration,

initially
but

dominated
due

by

transactional

to globalization,

company

work,

such

consolidation,

technological advancement, and further research, HR now focuses on strategic initiatives

like mergers and acquisitions, talent management, succession planning, industrial and labor
relations, and diversity and inclusion.

In startup companies, HR's duties may be performed by trained professionals. In larger

companies, an entire functional group is typically dedicated to the discipline, with staff
specializing in various HR tasks and functional leadership engaging in strategic decision making
across the business. To train practitioners for the profession, institutions of higher education,
professional associations, and companies themselves have created programs of study dedicated
explicitly to the duties of the function. Academic and practitioner organizations likewise seek to
engage and further the field of HR, as evidenced by several field-specific publications. HR is
also a field of research study that is popular within the fields of management
and industrial/organizational psychology, with research articles appearing in a number of
academic journals, including those mentioned later in this article.
In the current global work environment, most companies focus on lowering employee
turnover and retaining the talent and knowledge held by their workforce. New hiring not only
entails a high cost but also increases the risk of the newcomer not being able to replace the
person who was working in that position before. HR departments also strive to offer benefits that
will appeal to workers, thus reducing the risk of losing knowledge.

1.1-HISTORY OF HUMAN RESOURCE MANAGEMENT

Antecedent theoretical developments

HR spawned in the early 20th century and was influenced by Frederick Taylor (1856-1915).
Taylor explored what he termed "scientific management" (later referred to by others as
"Taylorism"), striving to improve economic in manufacturing jobs. He eventually keyed in on
one of the principal inputs into the manufacturing processlaborsparking inquiry
into workforce productivity.
The human

relations

movement grew

from

the

research

of Elton

Mayo and

others,

whose Hawthorne studies (1924-1932) serendipitously documented how stimuli, unrelated to

financial compensation and

working

[6]

by Abraham

Contemporaneous

work

conditions,

yielded

Maslow, Kurt

more productive
Lewin, Max

workers.

Weber (1864-

1920), Frederick Herzberg, and David McClelland (1917-1998) formed the basis for studies in
industrial and organizational psychology, organizational behavior and organizational theory,
giving room for an applied discipline.
During the latter half of the 20th century, union membership declined significantly, while
workforce management continued to expand its influence within organizations. "Industrial and
labor relations" began being used to refer specifically to issues concerning collective
representation, and many companies began referring to the profession as "personnel
3

administration". In 1948, what would later become the largest professional HR association
the Society for Human Resource Management (SHRM)was founded as the American Society
for Personnel Administration (ASPA).
Nearing the 21st century, advances in transportation and communications greatly facilitated
workforce mobility and collaboration. Corporations began viewing employees as assets rather
than as cogs in a machine. "Human resources management", consequently, became the dominant
term for the functionthe ASPA even changing its name to SHRM in 1998. "Human capital
management" is sometimes used synonymously with HR, although human capital typically refers
to a more narrow view of human resources; i.e., the knowledge the individuals embody and can
contribute to an organization. Likewise, other terms sometimes used to describe the field include
"organizational management", "manpower management", "talent management", "personnel
management", and simply "people management".
In popular media
HR has been depicted in several popular media. On the U.S. television series of The Office, HR
representative Toby Flenderson is sometimes seen as a nag because he constantly reminds
coworkers of company policies and government regulations. Long-running American comic
strip Dilbert also frequently portrays sadistic HR policies through character Catbert, the "evil
director of human resources". Additionally, an HR manager is the title character in the 2010
Israeli film The Human Resources Manager, while an HR intern is the protagonist in 1999
French film Ressources humaines. Additionally, the BBC sitcom dinnerladies main character
Philippa is an HR manager.

1.2-SCOPE OF HUMAN RESOURCE MANAGEMENT

The scope of HRM is extensive and far-reaching. Therefore, it is very difficult to define it
concisely. However, we may classify the same under following heads:

HRM in Personnel Management: This is typically direct manpower management that

involves manpower planning, hiring (recruitment and selection), training and
development, induction and orientation, transfer, promotion, compensation, layoff and
retrenchment, employee productivity. The overall objective here is to ascertain individual
growth, development and effectiveness which indirectly contribute to organizational
development.
It also includes performance appraisal, developing new skills, disbursement of wages,
incentives, allowances, traveling policies and procedures and other related courses of
actions.

HRM in Employee Welfare: This particular aspect of HRM deals with working
conditions and amenities at workplace. This includes a wide array of responsibilities and
services such as safety services, health services, welfare funds, social security and
medical services. It also covers appointment of safety officers, making the environment
worth working, eliminating workplace hazards, support by top management, job safety,
safeguarding machinery, cleanliness, proper ventilation and lighting, sanitation, medical

care, sickness benefits, employment injury benefits, personal injury benefits, maternity
benefits, unemployment benefits and family benefits.
It also relates to supervision, employee counseling, establishing harmonious relationships
with employees, education and training. Employee welfare is about determining
employees real needs and fulfilling them with active participation of both management
and employees. In addition to this, it also takes care of canteen facilities, crches, rest and
lunch rooms, housing, transport, medical assistance, education, health and safety,
recreation facilities, etc.

HRM in Industrial Relations: Since it is a highly sensitive area, it needs careful

interactions with labor or employee unions, addressing their grievances and settling the
disputes effectively in order to maintain peace and harmony in the organization. It is the
art and science of understanding the employment (union-management) relations, joint
consultation,

disciplinary

procedures,

solving

problems

with

mutual

efforts,

understanding human behavior and maintaining work relations, collective bargaining and
settlement of disputes.
The main aim is to safeguarding the interest of employees by securing the highest level of
understanding to the extent that does not leave a negative impact on organization. It is
about establishing, growing and promoting industrial democracy to safeguard the
interests of both employees and management.

The scope of HRM is extremely wide, thus, can not be written concisely. However, for the sake
of convenience and developing understanding about the subject, we divide it in three categories
mentioned above.

CHAPTER 2-PERFORMANCE APPRAISAL

A performance appraisal (PA), also referred to as a performance review, performance

evaluation, (career) development discussion, or employee appraisal is a method by which
the job performance of an employee is documented and evaluated. Performance appraisals are a
part of career development and consist of regular reviews of employee performance
within organizations.
A performance appraisal is a systematic and periodic process that assesses an individual
employees job performance and productivity in relation to certain pre-established criteria and
organizational objectives. Other aspects of individual employees are considered as well, such
as organizational citizenship behavior, accomplishments, potential for future improvement,
strengths and weaknesses, etc.
To collect PA data, there are three main methods: objective production, personnel, and
judgmental evaluation. Judgmental evaluations are the most commonly used with a large variety
of evaluation methods. Historically, PA has been conducted annually (long-cycle appraisals);
however, many companies are moving towards shorter cycles (every six months, every quarter),
and some have been moving into short-cycle (weekly, bi-weekly) PA . The interview could
7

function as providing feedback to employees, counseling and developing employees, and

conveying and discussing compensation, job status, or disciplinary decisions.PA is often
included in performance management systems. PA helps the subordinate answer two key
questions: first, "What are your expectations of me?" second, "How am I doing to meet your
expectations?"
Performance management systems are employed to manage and align" all of an organization's
resources in order to achieve highest possible performance. How performance is managed in an
organization determines to a large extent the success or failure of the organization. Therefore,
improving PA for everyone should be among the highest priorities of contemporary
organizations.
Some applications of PA are compensation, performance improvement, promotions, termination,
test validation, and more. While there are many potential benefits of PA, there are also some
potential drawbacks. For example, PA can help facilitate management-employee communication;
however, PA may result in legal issues if not executed appropriately, as many employees tend to
be unsatisfied with the PA process. PAs created in and determined as useful in the United States
are not necessarily able to be transferable cross-culturally

2.1-IMPORTANCE OF PERFORMANCE APPRRAISAL

1. Performance feedback
Most employees are very interested in knowing how well they are doing at present and how they
can do better in a future. They want this information to improve their performance in order to get
promotions and merit pay. Proper performance feedback can improve the employee's future
performance. It also gives him satisfaction and motivation.
2. Employee Training and Development Decisions
Performance Appraisal information is used to find out whether an employee requires additional
training and development. Deficiencies in performance may be due to inadequate knowledge or
skills. For e.g. A professor may improve his efficiency by attending workshops or seminars about
his subject. Performance appraisal helps a manager to find out whether he needs additional
9

training for improving his current job performance. Similarly, if the performance appraisal
results show that he can perform well in a higher position, then he is given training for the higher
level position.
3. Validation of Selection Process
Performance appraisal is a means of validating both internal (promotions and transfers) and
external (hiring new employees from outside) sources. Organisations spend a lot of time and
money for recruiting and selecting employees. Various tools used in the selection process are
application blanks, interviews, psychological tests, etc. These tools are used to predict (guess) the
candidate's performance on the job. A proper performance appraisal finds out the validity of the
various selection tools and so the company can follow suitable steps for selecting employees in
future.
4. Promotions
Performance appraisal is a way of finding out which employee should be given a promotion. Past
appraisals, together with other background data, will enable management to select proper persons
for promotion.
5. Transfers
Performance appraisal is also useful for taking transfer decisions. Transfers often involve
changes in job responsibilities, and it is important to find out the employees who can take these
responsibilities. Such identification of employees who can be transferred is possible through the
performance appraisal.
6. Layoff Decisions

10

Performance appraisal is a good way of taking layoff decisions. Employees may be asked to lay
off, if the need arises. The weakest performers are the first to be laid off. If there is no
performance appraisal, then there are chances that the best men in the department may be laid
off.
7. Compensation Decision
Performance appraisal can be used to compensate the employees by increasing their pay and
other incentives. This is truer in the case of managerial jobs and also in the case of employees in
non-unionized organisations. The better performances are rewarded with merit pay.
8. Human Resource Planning (HRP)
The appraisal process helps in human resource planning (HRP). Accurate and current appraisal
data regarding certain employees helps the management in talking decisions for future
employment. Without the knowledge of who is capable of being promoted, demoted, transferred,
laid off or terminated, management cannot make employment plans for the future.
9. Career Development
Performance appraisal also enables managers to coach and counsel employees in their career
development.

11

2.2-PROCESS OF PERFORMANCE APPRAISAL

Establishing performance
standards
commuicating the standards
measuring the performance
comparing with desired
performance
discussing result
decision making

12

A performance appraisal, or performance review, is a formal interaction between an employee

and her manager. This is when the performance of the employee is assessed and discussed in
thorough detail, with the manager communicating the weaknesses and strengths observed in the
employee and also identifying opportunities for the employee to develop professionally.
Here is the process involved in performance appraisal:1. Establishing Performance Standards
In this we use as the base to compare the actual performance of the employees. In this step it
requires to set the criteria to judge the performance of the employees as successful or
unsuccessful and the degrees of their contribution to the organizational goals and objectives. The
standards set should be clear, easily understandable and in measurable terms. If employee doesn't
come up to expectance, then it should be taken extra care for it.
2. Communicating the standards
It is the responsibility of the management to communicate the standards to all the employees of
the organization. The employees should be informed and the standards should be clearly
explained. This will help them to understand their roles and to know what exactly is expected
from them.
3. Measuring the actual Performance
The most difficult part of the performance appraisal process is measuring the actual performance
of the employees that is the work done by the employees during the specified period of time. It is
a nonstop process which involves monitors the performance all over the year. This stage requires
the watchful selection of the suitable techniques of measurement, taking care that individual bias
13

does not affect the outcome of the process and providing assistance rather than interfering in an
employees work.
4. Comparing the Actual with the Desired Performance
In this the actual performance is compared with the desired or the standard performance. The
comparison tells the deviations in the performance of the employees from the standards set. The
result can show the actual performance being more than the desired performance or, the actual
performance being less than the desired performance depicting a negative deviation in the
organizational performance. It includes recalling, evaluating and analysis of data related to the
employees' performance.
5. Discussing Results
The result of the appraisal is communicated and discussed with the employees on one-to-one
basis. The focus of this discussion is on communication and listening. The results, the problems
and the possible solutions are discussed with the aim of problem solving and reaching consensus.
The feedback should be given with a positive attitude as this can have an effect on the
employees' future performance. The purpose of the meeting should be to solve the problems
faced and motivate the employees to perform better.
6. Decision Making
The last step of the process is to take decisions which can be taken either to improve the
performance of the employees, take the required corrective actions, or the related HR decisions
like rewards, promotions, demotions, transfers etc.

14

2.3-TECHNIQUES OF PERFORMANCE APPRAISAL

Numerous methods have been devised to measure the quantity and quality of performance
appraisals. Each of the methods is effective for some purposes for some organizations only. None
should be dismissed or accepted as appropriate except as they relate to the particular needs of the
organization or an employee.
Broadly all methods of appraisals can be divided into two different categories.

Past Oriented Methods

Future Oriented Methods

Past Oriented Methods

15

1.

Rating Scales: Rating scales consists of several numerical scales representing job related

performance criterions such as dependability, initiative, output, attendance, attitude etc. Each
scales ranges from excellent to poor. The total numerical scores are computed and final
conclusions are derived. Advantages Adaptability, easy to use, low cost, every type of job can
be evaluated, large number of employees covered, no formal training required. Disadvantages
Raters biases

2.

Checklist: Under this method, checklist of statements of traits of employee in the form of

Yes or No based questions is prepared. Here the rater only does the reporting or checking and HR
department does the actual evaluation. Advantages economy, ease of administration, limited
training required, standardization. Disadvantages Raters biases, use of improper weighs by HR,
does not allow rater to give relative ratings
3.

Forced Choice Method: The series of statements arranged in the blocks of two or more are

given and the rater indicates which statement is true or false. The rater is forced to make a
choice. HR department does actual assessment. Advantages Absence of personal biases
because of forced choice. Disadvantages Statements may be wrongly framed.

4.

Forced Distribution Method: here employees are clustered around a high point on a rating

scale. Rater is compelled to distribute the employees on all points on the scale. It is assumed that
the performance is conformed to normal distribution. Advantages Eliminates Disadvantages
Assumption of normal distribution, unrealistic, errors of central tendency.
16

5.

Critical Incidents Method: The approach is focused on certain critical behaviors of

employee that makes all the difference in the performance. Supervisors as and when they occur
record such incidents. Advantages Evaluations are based on actual job behaviors, ratings are
supported by descriptions, feedback is easy, reduces recency biases, chances of subordinate
improvement are high. Disadvantages Negative incidents can be prioritized, forgetting
incidents, overly close supervision; feedback may be too much and may appear to be
punishment.

6.

Behaviorally Anchored Rating Scales: statements of effective and ineffective behaviors

determine the points. They are said to be behaviorally anchored. The rater is supposed to say,
which behavior describes the employee performance. Advantages helps overcome rating errors.
Disadvantages Suffers from distortions inherent in most rating techniques.
7.

Field Review Method: This is an appraisal done by someone outside employees own

department usually from corporate or HR department. Advantages Useful for managerial level
promotions, when comparable information is needed, Disadvantages Outsider is generally not
familiar with employees work environment, Observation of actual behaviors not possible.

8.

Performance Tests & Observations: This is based on the test of knowledge or skills. The

tests may be written or an actual presentation of skills. Tests must be reliable and validated to be

17

useful. Advantage Tests may be apt to measure potential more than actual performance.
Disadvantages Tests may suffer if costs of test development or administration are high.

9.

Confidential Records: Mostly used by government departments, however its application in

industry is not ruled out. Here the report is given in the form of Annual Confidentiality Report
(ACR) and may record ratings with respect to following items; attendance, self expression, team
work, leadership, initiative, technical ability, reasoning ability, originality and resourcefulness
etc. The system is highly secretive and confidential. Feedback to the assessee is given only in
case of an adverse entry. Disadvantage is that it is highly subjective and ratings can be
manipulated because the evaluations are linked to HR actions like promotions etc.

10. Essay Method: In this method the rater writes down the employee description in detail
within a number of broad categories like, overall impression of performance, promoteability of
employee, existing capabilities and qualifications of performing jobs, strengths and weaknesses
and training needs of the employee. Advantage It is extremely useful in filing information gaps
about the employees that often occur in a better-structured checklist. Disadvantages It its
highly dependent upon the writing skills of rater and most of them are not good writers. They
may get confused success depends on the memory power of raters.

18

11. Cost Accounting Method: Here performance is evaluated from the monetary returns yields
to his or her organization. Cost to keep employee, and benefit the organization derives is
ascertained. Hence it is more dependent upon cost and benefit analysis.

12. Comparative Evaluation Method (Ranking & Paired Comparisons): These are
collection of different methods that compare performance with that of other co-workers. The
usual techniques used may be ranking methods and paired comparison method.

Ranking Methods: Superior ranks his worker based on merit, from best to worst.
However how best and why best are not elaborated in this method. It is easy to administer and
explanation.

Paired Comparison Methods: In this method each employee is rated with another
employee in the form of pairs. The number of comparisons may be calculated with the help of a
formula as under.
N x (N-1) / 2

19

Future Oriented Methods

1.

Management By Objectives: It means management by objectives and the performance is

rated against the achievement of objectives stated by the management. MBO process goes as
under.

Establish goals and desired outcomes for each subordinate

Setting performance standards

Comparison of actual goals with goals attained by the employee

Establish new goals and new strategies for goals not achieved in previous year.

Advantage It is more useful for managerial positions.

Disadvantages Not applicable to all jobs, allocation of merit pay may result in setting shortterm goals rather than important and long-term goals etc.

2.

Psychological Appraisals: These appraisals are more directed to assess employees potential

for future performance rather than the past one. It is done in the form of in-depth interviews,
psychological tests, and discussion with supervisors and review of other evaluations. It is more
focused on employees emotional, intellectual, and motivational and other personal characteristics
affecting his performance. This approach is slow and costly and may be useful for bright young
20

members who may have considerable potential. However quality of these appraisals largely
depends upon the skills of psychologists who perform the evaluation.

3.

Assessment Centers: This technique was first developed in USA and UK in 1943. An

assessment center is a central location where managers may come together to have their
participation in job related exercises evaluated by trained observers. It is more focused on
observation of behaviors across a series of select exercises or work samples. Assessees are
requested to participate in in-basket exercises, work groups, computer simulations, role playing
and other similar activities which require same attributes for successful performance in actual
job. The characteristics assessed in assessment center can be assertiveness, persuasive ability,
communicating ability, planning and organizational ability, self confidence, resistance to stress,
energy level, decision making, sensitivity to feelings, administrative ability, creativity and mental
alertness etc. Disadvantages Costs of employees traveling and lodging, psychologists, ratings
strongly influenced by assessees inter-personal skills. Solid performers may feel suffocated in
simulated situations. Those who are not selected for this also may get affected.

4.

360-Degree Feedback: It is a technique which is systematic collection of performance data

on an individual group, derived from a number of stakeholders like immediate supervisors, team
members, customers, peers and self. In fact anyone who has useful information on how an
employee does a job may be one of the appraisers. This technique is highly useful in terms of
broader perspective, greater self-development and multi-source feedback is useful. 360-degree

21

appraisals are useful to measure inter-personal skills, customer satisfaction and team building
skills. However on the negative side, receiving feedback from multiple sources can be
intimidating, threatening etc. Multiple raters may be less adept at providing balanced and
objective feedback.

2.4-BENEFITS AND LIMITATIONS OF PERFORMANCE

APPRAISAL

Potential benefits
There are a number of potential benefits of organizational performance management conducting
formal performance appraisals (PAs). There has been a general consensus in the belief that PAs
lead to positive implications of organizations. Furthermore, PAs can benefit an organizations
effectiveness. One way is PAs can often lead to giving individual workers feedback about their
job performance. From this may spawn several potential benefits such as the individual workers
becoming more productive.
Other potential benefits include:

22

Facilitation of communication: communication in organizations is considered an

essential function of worker motivation. It has been proposed that feedback from PAs aid in
minimizing

employees perceptions of

uncertainty. Fundamentally,

feedback

and

management-employee communication can serve as a guide in job performance.

Enhancement of employee focus through promoting trust: behaviors, thoughts, and/or

issues may distract employees from their work, and trust issues may be among these
distracting factors. Such factors that consume psychological energy can lower job
performance and cause workers to lose sight of organizational goals. Properly constructed
and utilized PAs have the ability to lower distracting factors and encourage trust within the
organization.

Goal setting and desired performance reinforcement: organizations find it efficient to

match individual workers goals and performance with organizational goals .PAs provide
room for discussion in the collaboration of these individual and organizational goals.
Collaboration can also be advantageous by resulting in employee acceptance and satisfaction
of appraisal results.

Performance improvement: well constructed PAs can be valuable tools for

communication with employees as pertaining to how their job performance stands with
organizational expectations. At the organizational level, numerous studies have reported
positive relationships between human resource management (HRM) practices" and
performance improvement at both the individual and organizational levels.

23

Determination of training needs: Employee training and development are crucial

components in helping an organization achieve strategic initiatives. It has been argued that
for PAs to truly be effective, post-appraisal opportunities for training and development in
problem areas, as determined by the appraisal, must be offered. PAs can especially be
instrumental for identifying training needs of new employees finally; PAs can help in the
establishment and supervision of employees career goals.

Potential complications:
Despite all the potential advantages of formal performance appraisals (PAs), there are also
potential drawbacks. It has been noted that determining the relationship between individual job
performance and organizational performance can be a difficult task. Generally, there are two
overarching problems from which several complications spawn. One of the problems with
formal PAs is there can be detrimental effects to the organization(s) involved if the appraisals are

24

not used appropriately. The second problem with formal PAs is they can be ineffective if the PA
system does not correspond with the organizational culture and system.
Complications stemming from these issues are:

Detrimental to quality improvement: it has been proposed that the use of PA systems in
organizations adversely affect organizations pursuits of quality performance. It is believed
by some scholars and practitioners that the use of PAs is more than unnecessary if there is
total quality management.

Negative perceptions: Quite often, individuals have negative perceptions of PAs.

Receiving and/or the anticipation of receiving a PA can be uncomfortable and
distressful and potentially cause tension between supervisors and subordinates. If the
person being appraised does not trust their employer, appraiser or believe that they will
benefit from the process it may become a "tick box" exercise.

Errors: Performance appraisals should provide accurate and relevant ratings of an

employees performance as compared to pre-established criteria/goals (i.e. organizational
expectations). Nevertheless, supervisors will sometimes rate employees more favorably than
that of their true performance in order to please the employees and avoid conflict. Inflated
ratings are a common malady associated with formal" PA.

Legal issues: when PAs are not carried out appropriately, legal issues could result that
place the organization at risk. PAs are used in organizational disciplinary programs as well as
for promotional decisions within the organization. The improper application and utilization
of PAs can affect employees negatively and lead to legal action against the organization.
25

Performance goals: performance goals and PA systems are often used in association.
Negative outcomes concerning the organizations can result when goals are overly
challenging or overemphasized to the extent of affecting ethics, legal requirements, or
quality. Moreover, challenging performance goals can impede employees abilities to acquire
necessary knowledge and skills. Especially in the early stages of training, it would be more
beneficial to instruct employees on outcome goals than on performance goals.

Derail merit pay or performance-based pay: some researchers contend that the deficit
in merit pay and performance-based pay is linked to the fundamental issues stemming from
PA systems

CHAPTER 3-PERFORMANCE APPRAISAL AT WNS

INDUSTRY PROFILE
HISTORY
WNS (Holdings) Limited (WNS), incorporated on February 18, 2002, is a holding company.
WNS is a provider of offshore business process outsourcing (BPO) services, offering data, voice,
26

analytical and business transformation services. The Company transfers the business processes of
its clients its delivery centers, located in Costa Rica, India, the Philippines, Romania, Sri Lanka,
the United Kingdom and the United States, as well as to its subcontractors delivery center in
South Africa. The Company operates in two segments: WNS Global BPO and WNS Auto Claims
BPO. The Companys clients are primarily in the travel, banking, financial services, insurance,
healthcare and utilities, retail and consumer product industries. Its portfolio of services includes
vertical-specific processes that are tailored to address its clients business and industry practices.
In addition, it offers a set of shared services, including customer care, finance and accounting,
legal services, procurement, research and analytics and technology services. To support its
operations, WNS has launched its research and analytics platform, WADE. On November 1,
2011, the Company acquired 100% interest in WNS Philippines Inc. On April 6, 2011, WNS
Customer Solutions North America Inc. merged into WNS North America Inc. On June 29, 2011,
Business Applications Associations Inc. merged into WNS North America Inc.
In the Companys WNS Auto Claims BPO segment, WNS provides both fault and non fault
repairs. For fault repairs, it provides claims handling and repair management services, where it
arranges for automobile repairs through a network of third party repair centers. For its non fault
repairs business, the Company generally provides a suite of accident management services,
including credit hire and credit repair. The Companys insurance services are structured into
three lines of business offerings customized for property and casualty insurance, life and
annuities and healthcare. Its insurance business vertical includes its auto claims business,
consists of WNS Assistance and Accidents Happen Assistance Limited, which is consists of its
WNS Auto Claims BPO segment. The Company offers an onshore, nearshore and offshore
delivery model that enables us to handle the automobile insurance claims cycle.
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WNS offers repair management services to its clients, where it arranges for the repair of
automobiles through a network of repair centers. WNS also offers claims management services.
In addition, it provides third party claims handling services, including the administration and
settlement of property and bodily injury claims. It delivers services to clients across the travel
and leisure industry value chain. The Company provides a range of solutions that support air, car,
hotel, marine and packaged travel and leisure services offered by our clients. WNS delivers BPO
services for the manufacturing, retail and consumer products, and telecom industries. Its
consulting and professional services (CPS) business caters to the consulting and professional
services industry. Its CPS business unit provides its clients with cross industry, services in
research and analytics, finance and accounting, customer care, legal services and transformation
solutions.
The Company offers health information management (HIM) coding (including current
procedural technology (CPT) and international classification of diseases (ICD-9)), medicare and
medical claim processing, revenue management related processes and Health Insurance
Portability and Accountability Act (HIPAA) compliance. Its banking and financial sectors it
serves include consumer, retail and commercial banking and mortgage; wealth, investment
management and investment banking; research and analytics services; financial advisory firms,
and financial research and financial market intelligence companies. The Company delivers a
range of industry-specific business processes across the shipping and logistics industry, as well
as provides services in the areas of finance and accounting, customer care, business technology,
procurement and human resources administration. It also offers decision support services in the
form of research and analytics.

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The Company competes with Genpact Limited, Firstsource Solutions Limited, EXL Service
Holdings, Inc, Infosys Technologies Limited, Tata Consultancy Services Limited, Wipro
Technologies Limited, Accenture Limited., Affiliated Computer Services Inc, Hewlett-Packard
and International Business Machines Corporation.

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3.1-INTRODUCTION TO THE COMPANY

WNS Global is a global business process management company headquartered in New

Jersey, United States. It has 36 "delivery centers" across the world, including India,United
Kingdom, Australia, China, Costa Rica, Philippines, Poland, Romania, South Africa, and Sri
Lanka. Adrian T. Dillon is the Chairman of the Board and Keshav R Murugesh is the group
CEO.
WNS began operations as a captive / in-house unit of British Airways in 1996 and was known as
WNS World Network Services. WNS started providing business process outsourcing services to
third parties in 2002 and went public in 2006.
WNS offers customer care outsourcing, finance and accounting, human resource outsourcing,
legal services, procurement, risk management, transformation solutions and research and
analytics to ten industries. These are banking and financial services; healthcare; insurance;
manufacturing; media and entertainment; retail and consumer packaged goods; shipping and
logistics; telecommunications; travel and leisure; utilities and energy.

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WNS has developed technology-enabled platforms like WNS-Verifare, WNS-Jade, WNSDynamic Discount Manager and WNS-ProClaim.

3.2-WNS SERVICES
WNS delivers business value by "extending your enterprise." Our business process outsourcing
services combine deep industry knowledge, operational excellence, a partnership approach to
client engagement and comprehensive service offerings.
In every enterprise, business processes are interconnected. Only when you link shared back
office and industry specific processes to decision support does business thrive. The value of
business process outsourcing is realized by optimizing and linking disparate processes
seamlessly.

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WNS changes the game for its clients by delivering the entire spectrum of business process
outsourcing services. WNS delivers shared back office processes such as finance and
accounting, customer care, legal, technology solutions and procurement to industry specific back
office and front office processes. We also support decision making by delivering complex
research.
We help our clients leverage outsourcing services to improve their business performance so that
they can compete more effectively in the marketplace.

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3.3- PERFORMANCE APPRAISAL TECHNIQUE USED BY WNS.

The appraisal model which is followed on annual basis starting from the month of April till
March has been extremely effective for the employees of WNS. Half yearly appraisal system,
was started a year ago. This activity was started keeping in mind the dynamic behavior of the
industry. With a half yearly appraisal system, the employee gets feedback twice a year, which
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gives him/her a chance to re-look at his/her approach of working. Necessary steps are also
undertaken for employees who deviate from their goals. They have introduced a comprehensive
system of quarterly appraisals where an employee selects his/her own goals or Key Result Area
(KRAs) every quarter and him/her self assesses his/her own performance against these
parameters. At Spice jet while formally the process is annual, for several of the frontline
employees, there are performance related quarterly payouts designed to reward them with
incentives for their performance. This has resulted in quarterly assessments which are aligned
overall to annual KRAs.WNS have a midterm review for all those who have been performers,
thereby creating an expectation amongst the employees of an increase in salary twice a year if
they perform well. They used to have annual appraisals earlier, but then they felt that the
incentives are not enough to motivation the sales department, which generates major revenues or
the organization. They do give monetary increments and designation hikes, according to the
performance. If the employee deserves both, they give him/her both the advantages otherwise at
least one of them. Designation hikes are given annually. These are proportional to effort of the
individual, team and the department. Designation changes are given keeping in mind the
immense responsibility one has to shoulder in a high rank. Monetary increments are primarily
incentives that are given either in cash or kind for example they give them travel package within
India or outside. Also, they have an accumulating incentive scheme in which employees can
accumulate incentives and get them annually with interest. To meet the new demands of the
business and to motivate the employees for higher performance, they have started linking a part
of the salary increase to individual performance measures as variable pay. At present, between 6
to 8 percent of the compensation is variable pay, which they are planning to increase over a

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period of time. Executives are categorized in levels based on their performances in a relative
ranking and based on outcome performance-linked pay is awarded.
Along with this there are many other technique used by company for performance appraisal from
time to time. For example Rating scale, 360 degree, Management by objectives etc.

According to the study there are some Clarity and problems of WNS appraisal process:

WNS appraisal process is not clear & also not perfect at all.
WNS project manager generally give good performance band/rating according to

personal relation.
Employee Performance Appraisal is Painful & does not motivate the WNS associates.
WNS appraisal process does not assess actual performance of team member.
WNS appraisal process is a non data based assessment.
WNS appraisal process actually demotivates the associates.
Cross-comparisons are not possible in WNS appraisal process.
No alert is given to WNS associates regarding their performance.

CHAPTER 4-SUGGESTIONS TO IMPROVE

PERFORMANCE APPRAISAL IN A COMPANY
1. Performance appraisal could be conducted by a person inside the organization and one
who is familiar with the employees.
2. Objective of conducting the performance appraisal could be discussed and doubts can
be clarified.
3. Performance appraisal could be updated regularly to match individual and
organizational goals.
4. Suggestion could be obtained from employees regarding framing the performance
appraisal system.

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5. Since the performance appraisal is conducted by the outsider, employees suggestion

during performance appraisal may not reach the top managers. For such situations
suggestion box can be implemented and frequently reviewed.
6. The appraiser must be familiarized with the employees job responsibilities and duties
before conducting performance appraisal.
7. Feedback on performance could be discussed through formal or informal meetings.
8. This may enhance the involvement and performance of employees.
9. Appropriate and experienced appraiser can be appointed for effective performance
appraisal results.
10. Performance appraisal can developed in such away to identify the hidden talent and
skills of employees.
11. Employees having low performance could be called individually, encouraged and
monitored closely to make improvements.
12. Appraisal feedback is very important in any performance appraisal program. Could be
carefully communicated by making high performers increase their target and low
performers to build up their confidence.

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CHAPTER 5-CONCLUSION

Performance appraisal may be understood as the assessment of an individuals performance in a

systematic way. The performance being measured against such factors as job knowledge, quality
and quantity of output, initiative, leadership abilities, supervision, dependability, co-operation,
judgment, versatility, health and the like. It also helps in developing strength and rectifies
weakness of the employees.
WNS have been conducting performance appraisal for the past many years. From the study it has
been identified that the performance appraisal is able to identify employees potential and find
the motivating factors of employees. The major drawback is in terms of the appraiser and his
knowledge regarding employees job responsibilities and duties.
WNS has been running successfully for past and has created a good name among its customers
and society. People having poor background are given training and provided with jobs.
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Performance appraisal can be conducted more effectively by using the right tools and properly
reviewing and updating the performance appraisal program. Suggestion from employees and
experienced personnel can further enhance and make the performance appraisal an ideal
evaluation system.

WEBLIOGRAPHY
http://www.whatishumanresource.com/
http://www.successfactors.com/
http://www.businessballs.com/
http://www.wns.com/
http://searchcio.techtarget.in/

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BIBLIOGRAPHY
1. HUMAN RESOURCE MANAGEMENT
BY ASHWAT THAPA
2. PERFORMANCE MANAGEMENT, CONCEPTS, PRACTICES AND STRATEGIES FOR
ORGANIZATION SUCCESS
BY S.K BHATIA DEEP AND DEEP PUBLICATIONS.

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