Chapter-1

INTRODUCTION OF THE STUDY

Knowledge
present

cannot

scenario

be
where

perfect

without

circumstance

application

are

rapidly

in

the

changing,

practical
only

field.

class

In

room

teaching is not enough, unless exposure to practical dealing .Vocational training has been
made all integral part of the management course .
I had an opportunity to undergo 4 weeks vocational training in SYNDICATE
BANK, BRANCH-SABAIJORE, DEOGHAR, and JHARKHAND. The main coverage of
my training and the project report is the study of performance appraisal system.
My whole project report is divided in many chapters. I have tried my level best to arrange and
write down the report in a good systematical and chronological way with all possible
information.
Performance appraisal system is very important for every organization. It is done through
format, while filling the format is essential that your appraisal should be truthful and fair.

OBJECTIVE OF THE STUDY

The objective of the study is to get the practical knowledge of the performance
appraisal system.

The objective of the study is to get the whole and consistent knowledge about
Appraisal system in SYNDICATE BANK.

By conducting a survey the ideas and thinking of executive and general staff which
Helps in understanding the appraisal system.

SCOPE OF THE STUDY

During the study period the main concentration was on the method and application
of performance appraisal, which is adopted by SYNDICATE BANK, SABAIJORE. It has
also been tried to find out wether these method are effective or not? In this study opinion and
suggestion the bank staffs have taken in to consideration. Their feedbacks have also been
taken to see about the existing appraisal system.

METHODOLOGY OF THE STUDY

Research Tool
Questionnaire methodIn this method an attempt was to collect the staff and existing performance system. The
questionnaire has been made & its protesting has also been done, So that any collection, if
needed can be done. Then only the final questionnaire was carefully prepared and has been
made for the BANK staffs.

DATA COLLECTION METHODThe used in the study is random sampling. The select sample of the staffs was 22 out of the54
staffs.

SOURCE OF THE STUDY

The main source of information in the study is as follows:

Files and records of personnel department.

Interview of the officials and discussion with them.

Questionnaire.

Magazines and circular by the organization.

Observation.

Limitation of the study

All though I tried my best to gather information for preparation of this project report and
management of Syndicate bank was kind enough to permit me conduct the study on A
brief study of performance appraisal system. During the study some problems likes, with
in short span of time it not possible to collect all the Data, opinions and other records
have also been experience Secondly many executives were too much busy in their
assigned work, so I could not get their full cooperation.

SYNDICATE BANK
HEAD OFFICE: MANIPAL-576104

An introduction of the Bank:

Syndicate bank was established in 1925 in Udupi, the abode of Lord Krishna in coastal
Karnataka with a capital of Rs.8000/- by three visionaries Sri Upendra Ananth Pai, a
businessman, Sri VamanKudva, an engineer and Dr. T M A Pai, a physician who shared a
strong commitment to social welfare . Their objective was primarily to extend financial
assistance to the local weavers who were crippled by a crisis in the handloom industry
through mobilizing small saving from the community. The bank collected as low as 2 annas
daily at the doorsteps of the depositors through its Agent under its pigmy deposit scheme
started in 1928. The scheme is the banks brand equity today and the bank collects around Rs.
2 crore per day under the scheme.
The progress of Syndicate bank has been synonymous with the phase of progressive banking
in India. Spanning over 80 years of pioneering expertise, the bank has created for itself a
solid customer base comprising customer of two or three generations. Being firmly rooted in
rural India and understanding the grassroots realities, the banks perception had vision of
future India. It has been propagating innovations in banking and also has been receptive to
new ideas, without however getting uprooted from its distinctive socio-economic and cultural
ethos. Its philosophy of growth mutual sustenance of both the bank and the people has paid
rich dividends. The bank has been operating as a catalyst of development across the country
with particular reference to the common man at the individual level and in rural/ semi urban
centers at the area level.
The Bank is well equipment to meet the challenges of the 21 st century in the area of
information technology, Knowledge and competition. A comprehensive IT plan is being put
in place and the skill and knowledge of the Banks personnel are being upgraded through a
variety of training programmers to promote customer delight in every sphere of its activity.
The bank has launched an ambitious technology plan called Centralized Banking solution

where 500 of our strategic branches with their ATMs are being networked nationwide over a
4- year period.

MISSION OF SYNDICATE BANK

The Mission articulated for the functional area of the Bank is
highlighted below:
Resources: To achieve global deposits of Rs. 76 thousand crore by March 2007 with
emphasis on low-cost resources by planned strategic initiatives including branch expansion,
aggressive marketing and active involvement of each and every employee of the bank.
Advances: To build a qualitative asset base of around Rs.51 thousand crore by March 2007 to
augment the Income portfolio of the bank.
Business: To achieve global business of Rs.127 thousand crore by March 2007 and attain
Rs.240thousand crore by 2010
Profitability: To make every branch a profit center to earn a net profit of maximum Rs.one
thousand crore by March 2007 and ensure best possible return to the stake holders value.
Human Resource & Organization Structure: To mould and strengthen the organizational
structure to meet the future business requirements and challenges. To redefine and redevelop
peoples management techniques so as to unleash human potential, drive growth and nature
leadership of high quality corporate governance.
Customer Relationship Management: To fine tune our marketing strategies to meet the
ever growing market demands, to ensure that our product and services adapt to the changing
needs and expectation of the customer, to provide the customer the ideal banking ambience,
to reorient our publicity so as to provide increasing visibility to our Brand, to get our
branches/officesISO9000 complaint.
Risk Management: To continuously upgrade the risk management systems & processes,
imbibe risk management in business activities and implement base1 11 requirements for the
benefit of all stakeholders.
Information Technology: To bring minimum of 80%of the banks business under centralized
core banking network by March 2007 spanning minimum of 1500 branches across the

country, supplemented by additional delivery channels with 800 ATMs, backed by a

comprehensive fail safe business continuity plan.
Forex and treasury: To profitably manage the forex and investment assets of the bank to
achieve a dealing room turnover of Rs.535 thousand crore by March 2007 and a net profit
exceeding Rs.105 crore.
Para Banking: To achieve insurance premium collection of nearly Rs.180 crore with a
commission income of Rs.20 crore, a credit card base of 1 lakh that brings in net earnings of
a minimum of Rs. 3.50 crore and a debit card base of 15 lakh fetching a net revenue of Rs.25
crore.
Inspection: To migrate progressively from the present transaction oriented inspection system
to a risk based audit exercise enhancing the effectiveness of risk management, control and
governance processes.

SYNDICATE BANK

Organizational Structure
Bard of directors
Chairman & Managing Directors
Executive Director
General Manager
Portfolios
.
1. Planning &Dev department
2. Central account & legal dept
3. Personnel department
4. Inspection department
5. Vigilance department
6. Credit department
7. Recoveries department
8. Dept. of Information technology
9. Treasury & International banking Divn.
10. Risk management & Monitoring Dept.
11. Priority sector credit dept

GM Offices/ Regional Offices- 35

Branches- 2014

Pay scale structure of Syndicate bank employee and worker

Government and Bank employees Association has agreed on revised of pay scale on base of
6th pay commission report recommendation. A bank employee has agreed on 17.5%
increment of their pay scale. Here is a detail of new pay scale of each grade of bank
employees.

Class

Present Pay Scale

New Pay Scale

High Class Officer

26620-38900

31278-45707

Class 1 Officer

20480-26620

24064-31278

Class 2 Officer

10000-22800

11750-26790

Assistant Grade

4410-16570

5181-19469

D Group

4060-9180

4770-10786

PERFORMANCE FOR THE PERIOD ENDED

31ST March 2010
Syndicate Bank recorded 18% increase in its operating profit for the 4 th quarter ended March
2010. The operating profit was Rs. 552 crore for the Q4 as against Rs. 466 crore recorded

during the corresponding period of the previous year. Net Interest income increased by 57%
to Rs. 681 crore for the quarter ended March 2010 from Rs. 547 crore for the quarter ended
March 2009. However, the net profit for Q4 at Rs. 168 crore, was lower mainly due to higher
provision towards wage arrears, taxes etc. The provision made towards taxes during the
quarter at Rs. 121 crore is substantially higher than Rs. 27 crore provided during the
corresponding quarter in the previous year. Similarly, provision of Rs. 34 crore towards
arrears of wages during the quarter is much higher than Rs. 15 crore provided in the Q4 of
previous year.
The operating profit for the year ended March 2010 increased to Rs. 1873 crore with an
increase of 12% over Rs. 1671 crore as at March 2009. The net Interest Income for 2009-10
increased to Rs. 2740 crore from Rs. 2548 crore in the previous year. The net profit for the
year4 however, was lower at 813 crore as compared to Rs. 913 crore last year (2008-09). This
was mainly due to the higher provisions towards taxes at 361 crore as against Rs. 112 crore in
the previous year and wage arrears at Rs. 220 as against Rs. 75 crore in the previous year.
The Global Business of the Bank crossed the milestone of Rs. 2,00,000 crore and stood at Rs.
2,08,820 crore as on 31.03.2010. Global Deposit reached Rs. 1,17,037 crore and advances
increased to Rs.89,905 crore as on 31.03.2010. The bank shed around 40% of its high cost
bulk deposits amounting to Rs. 7874 crore during its share of CASA to domestic deposits
during the year to 32.86% from 28.89% on Mar 09.

The Banks thrust on priority sector including leading to agriculture sector continued and the
outstanding amount under priority sector increased to Rs. 32713 crore from Rs. 27364 crore
as on 31st March 2009, achieving a growth of 19.55% and constituted 45.88% of Adjusted
Net Bank credit Agriculture advances increased to Rs. 13135 crore from Rs. 10769 as on
March 2009, registering a growth of 21.97% and constituted 18.42% of Adjusted Net credit.
The banks focus on MSME credit resulted in 22% y-o-y growth in this sector with

outstanding amount increased to Rs. 9741 crore during the year Rs. 7978 crore as on 31 st
March 2009.
The Bank focused on infrasture lending and the years on year growth under infrasture sector
were Rs.11393 crore. Extending Education loans was one of the priority areas under retail
sector and the Bank recorded 24.18% growth under education loans was Rs.1460 crore
during the year.
Due to recessionary conditions and consequential stress on the assets, the percentage of Gross
& Net NPAs of the Bank increased marginally to 2.19% and 1.07% respectively in 2009-10
as compared to 1.935 and 0.77% in 2008-2009. However, the NPA provision coverage Ratio
is 73.3 which is higher than the mandatory coverage ratio of 70%
The bank opened 82 branches during the year 2009-10. Most of the new branches opened
during the year either in tier 3 to 6 centre or in under banked districts, thus making the
banking facilities available to the financially excluded sector. All the 2307 branches of the
Bank spread along the length & breath of the country are networked under core banking
solution (cbs). The bank also has overseas branches at Londan. The Bank opened 3 new
Regional offices at Guwahati, Moradabad and jaipur to provide better services to its clients.
The total Regional offices have increased to 38.

Different Product and Services offered by the

Bank

Counter service
All branches display time norms indicative of all maximum timings requires for extending
various under normal circumstances. In case of delay, the bank may bring the matter to the
notice of the branches head or to the Appellate Authority seeking remedy.

TELLER FACILITY:
Teller facility is introduce in all Totally Computerized and CBS branches to reduce the
transactions time in cash withdrawal and case deposits up to certain monetary ceiling. Under
this single window concept the withdrawal slip or cheque of amount up to the prescribed
ceiling may be tendered to the teller directly to obtain the cash thus reducing the transaction
or waiting time. In CBS branches services from the front line officers are made available.

DEMAND DEPOSITS:
Current Accounts and Savings Accounts are categorized as demand deposits and prescribed
minimum balance is required to be maintained in these accounts to enable servicing of such
accounts. Non-maintenance of minimum balance will attract charges as prescribed by the
bank from time to time. The prescribed minimum balance requirement is provided hereunder.
At CBS branches the minimum monthly average balance is prescribed in place of minimum
balance.

CATEGORY

Rural/ Semi-urban

Urban/ Metropolitan

CBS

Branches
Current Account
Individuals

1000/-

2000/-

10000/-

Others

2000/-

3000/-

10000/-

With Cheque book

500/-

500/-

2000/-

Without Cheque book

100/-

250/-

2000/-

5/-

5/-

Saving Accounts

For Pensioners

250/-

TERM DEPOSITS
Under these deposit schemes depositors can opt payment of interest either at maturity or at
periodical intervals. Fixed Deposits, Social security deposits, senior citizen security deposits
are schemes offering periodical interest payments. In respect of suvidha deposit part

withdrawals of principal amount is also allowed without penalty. The interest is compounded
quarterly in

V IKAS Cash Certificate and payable along with principal at maturity.

LOANS AND ADVANCES:

The Bank has carefully designed the loan schemes to meet divergent financial needs of
various segments of society and there payment schedules are tailored to suit their income
streams. Personal Banking Loan Schemes viz. SyndSaral,SyndSuvidha, SyndVahan,
SyndKisan, SyndMortgage aim to fulfill the individual financial needs like purchase of
consumer durables,
Vehicles or any other genuine credit requirements. The students pursuing higher education are
provided credit under our SyndVidya scheme. The agriculturists, professionals, salaried class,
executives, traders, pensioners, defence personnel, industrialists can meet their financial
needs through various credit schemes of the bank.SyndNivas meets the aspirations of the
public to own a house loan products are designed to provide credit against security of gold
ornaments,NSC, KVP, LIC policies goi bonds, share of public listed companies, units of UTI
and against rents receivable etc. also The temporary financial needs of pensioners and people
drawing, salary though our branches are met though SyndOverline and temporary overdrafts
in SB accounts.

SYNDICATE BANK GLOBAL DEBIT / ATM CARD & GLOBAL

CREDIT CARD:

The Bank is offering global debit cum ATM card to the account holders of CBS branches to
facilitate withdrawal of cash not only at our banks ATM but also other banks ATM which
accept VISA cards. The debit card can be used for purchases at any merchant establishment
who accept VISA cards. The bank has become a member of Cash tree to facilitate the account
holders to withdraw cash and make balance enquiries with other member banks ATM at
nominal charges. The bank is also offering Syndicate Bank global credit card with features
like minimum payable amount and lower interest rates.

Synd Bill Pay: A hassle free utility payment product wherein utility bills can be paid by
the Bank. The modes of payment by registering with the bank all for no charges

A. Autopay- Where the bank pays the bill on date

B. On line pay- Where you can view the bills that are due and authorize payment on line

On Line Railway Ticket Booking:

The bank has joined hands with Indian Railway Catering & Tourism Corporation Ltd to offer
online booking of railway tickets for all inter customers of our bank. This facility is offered to
the customers at free of cost.

GIFT CHEQUES:
The bank sells through 785 designated branches/ extension counter gift cheques at par in
denomination of Rs. 51, 101 and 501.

REMITTANCES/ TRANSFER OF FUNDS:

The public can purchase Demand Drafts, pay orders or remit money through mail transfer,
telegraphic transfer on other on other branches of the bank by paying the prescribed charges.
The bank also important electronic fund transfer, special electronic fund transfer, electronic

clearing scheme in the designated centre. The bank has also tied up for western union money
transfers.

COLLECTION OF CHEQUES/ BILLS:

The public can collect the local or outstation cheques/ bills drawn on our branches of other
banks through all our branches subject to payment of prevent charges. The bank is offering
cash management service enabling speedy collection of receivables of corporate at select
branches. The discounting of cheques bills is also considered at the request of the customer
based on the conduct of their accounts.

SAFE DEPOSIT LOCKRS:

The bank offers the facility of safe deposit to the public for safe keeping of the valuables/
articles and the locker rent depends on the size of the lockers.

SAFE CUSTODY SERVICE:

The banks accept for safe keeping important document like deposit receipts, share certificate
security will and sealed covers etc. Subject to prevalent guidelines at its branches for a
nominal fee .The customer may also utilize the facility for collection of interest on such
securities kept in safe custody with the bank at the prescribed charges.

FOREIGN EXCHANGE TRANSACTIONS: Some of the additional service

offered at these designated branches. To enable faster remittance facility to the NRI
customers of exchange companies manage by our bank Syndicate-e-Remit, Syndicate-eDraft, MT Scheme are implemented.

Customer Care
The bank is committed to transparency and customer friendly approach in its dealing with the
public.

May I Help You Counter: May I help you counters are provided at select branches
assistance to the customer in carrying out various banking transactions and to provide the
necessary information on the banks products and services.

Immediate Credit of Outstanding/ Local Cheques: The bank extends immediate

credit to the account of the account of the customer for the local/ outstation cheques up to Rs.
15,000/- on payment of normal collection charge after satisfying about the proper conduct of
the account
.

Complaint/ Suggestion Box: A complaint/ suggestion box is installed at prominent

place in the branches counter for the convenience of the public for making suggestion or for
lodging complaint or for outlining the perceived deficiencies. The will be opened every day
and the suggestions/ complaint will receive immediate attention by the bank officials.

Toll Tree Voice Mail System:

The voice mail system is functioning as an intermediately to improve the comfort level of the
customer with our bank. This system provides our customer a unique way of reaching the
concerned officials of the bank to indicate to the either of their suggestion, feedback,
complaints, grievances.

Toll Free Voice Mail Number is 1800 425 66 55 . The customer can dial the toll free
number and voice out their complaint, grievances, suggestion. Their message will get
recorded. This suggestion, feedback grievances received thro this voice mail system is being
sorted out within next 48 hours.

24 Hours Interactive Help Line FOR Credit Card and Debit Card:

We have 24 hours toll free interactive help line numbers 1600 22 5092 exclusively for
credit card for hot listing the card reported to be lost and all queries regarding their credit
card account, billing and balance. Another 24 hour helps line number 080-22357440 is
available exclusively for hot listing the debit card.

Redressal of Grievances:
The bank has constitute customer grievances redressal cells at all regional offices, general
managers office and at corporate office Bangalore to ensure prompt redress of customer
complaints. The cells besides reviewing the grievances of the constitute, also implement of
the betterment of the customer service in the operational area.

Banks web site

The bank display up to date information on its branches, product, services and interest rates
etc. on its web site http:// www. Syndicate bank.com. The information covers both domestic
and NRI products and services. The web site also hosts banks information of public interest
like banks model policy of deposits, banks fair practice code etc. The update financial
information related to the bank is also displayed on the web site.

Para banking facilities of Syndicate bank

1. Syndicate bank global debit card

Carry your bank with you.

A convenient e-wallet valid in India and abroad with VISA power.

Brings you the convenience of accessing your money any time and from anywhere

across the world.

Over 16,000 ATMs in India and over 10,00,000 ATMs across the global with
VISA logo would honour the card round the clock for cash withdrawal and

balance enquiry.
24 Hrs access to withdraw cash from all ATMs of Syndicate bank and all ATMs

displaying cash tree logo in India.

Enables shopping, dining and

purchases

at

over

1,88,000

Merchant

Establishments in India and over 24 million MEs across the globe displaying

VISA logo.
Transact in any currency anywhere, but pay in India Rupees (INR),
No admission fee and no annual fee presently.
No transaction fee at all Syndicate bank ATMs.

Syndicate bank global credit cards

Offers extra power in your purse.

It is photo / signature card that provides additional security and recognition for

you.
Have the power for making payment with your card at mere than 1,88,000
Merchant Establishment in India and over 24 Million MEs across the global where

VISA cards are accepted.

Have the privilege to access, round the clock, over 16000 ATMs in India and over

10,00,000 ATMs across the global displaying VISA logo.

Have access to withdraw cash at all ATMs of Syndicate bank and at all ATMs

displaying cash tree logo in India round the clock.

Minimum income requirement for issue of credit card is Rs. 60000/- p.a.
Free credit period of minimum 20 days and maximum 50 days.
Flexible option to pay a minimum of 10% of the outstanding amount every month
on due date to avail revolving credit facility that helps you to optimize your

resources.
Avail 15% of credit limit as credit limit under classic credit card and 25% of card

limit as cash limit under gold credit card.

FREE Personal Accident Insurance cover of Rs. 2.00 lakhs for classic card holders
available including Add-on cardholders.

FREE Personal Accident Insurance cover of Rs. 5.00 lakhs for gold card holders

available including Add-on cardholders.

Limited Lost Card liability of Rs.1000/-.
Facility of Add-on cards.

2. Banc assurance:
Bank as a one stop financial shop to enhance satisfaction is distributing life and non-life
insurance products.

Life Insurance Products:

Bank has tried up with M/s. Bajaj Allianz life insurance CO. Ltd. for distribution of their life
insurance products. It offers a range of products as follows, at competitive premium.

Saving life cover

Risk cover
Loan cover
Long term investment

Non Life Insurance Products:

To consolidate the business under banc assurance scheme and to provide additional
products to the customer, bank has entered into distribution of non-life insurance product
by tying up with M/s. United India Insurance Co. Ltd.
Bank has obtained IRDA License to act as corporate insurance agent of united India
insurance Co. Ltd.
A package policy is devised covering the assets against fire and allied perils covering
lighting. Explosion/ implosion, aircraft damage, etc. Riot, Strike, Malicious and
Terrorism damages are covered at extra premium.
The person against death or injoury arising out of accident.

Asset quality
The strategies adopted by the bank in managing nonperforming assets have paid rich
dividends.Net NPA declined below the 1%maek going down from Rs. 426 crore to Rs. 313
crore, i.e. from 1.59% to 0.86%. Provision coverage was further strengthened from 67.25% to
76.77%.
As announced by the Honble finance minister, the bank has implemented one time
settlement scheme for small and medium enterprise accounts as communicated by reserve
bank of India. Bank has also put in palace a special OTS scheme for NPAs in smaller
accounts up ro 25,000/-to extend an opportunity to settle their dues.
The bank id utilizing the securitization and reconstruction of financial assets and enforcement
of security interest Act-2002 as an effective tool for recovery of non-performing assets.4430
notices were issued under the Act and bank could recover Rs. 187.32 crore in 2797 accounts.

Treasury Operations:
The banks net domestic investments decreased by 15.64% from Rs. 20296.91 crore as on
31.03.2005 to Rs. 17122.92 crore as on 31.03.2006. This was primarily due to the conscious
decision to shed excess SLR securities and revamp the portfolio to free resources for credit
growth. The bank could earn a trading profit of securities other than share of Rs.38.75 crore
deposit adverse market condition during the previous year. The bank has strengthened the
equity desk and has taken advantage of the buoyant equity market. The bank earned a profit
of Rs.61.59 crore in equity trading, as against Rs.45.03 crore in the previous year.

National Priorities:
The bank has maintained its excellent track recode of pre-eminenc in social lending, which it
views as a major business opportunity. The priority sector advances of the bank reached a
level of Rs.14626.62 crore constituting 44.87% of Net bank credit card and where well above
the Mandatory target of 40%. Adequate care has been taken to ensure that the credit needs of
the weak and under privileged section such as SC/ST, minority communities and women are
fully met.

Rural development initiative:

The bank has been in the forefront in promoting adoption of new technology in the field of
agricultural for improving farm productivity and efficiency. As many as 950 rural extensions
education programmes were organized by the branches during the year. Syndicate rural
development trust was established to promote rural development by fostering rural
development by fostering rural entrepreneurship and promoting micro credit as the means of
helping the rural Poor, especially women. During the year 214 training programmes were
organized benefiting 7272 persons of whom 3933 were women through eight Syndicate
institutes of rural entrepreneurship development.
The bank, in associations with Canara Bank and Sri Dharmasthala Manjunatheswara
educational trust, has sponsored 20 rural development and self-employment training institutes
across the country.

Community Concern:
The bank effectiveness participated in implementing government sponsored poverty
alleviation and employment generation schemes and organized training programmes for skill
development through Syndicate institute of rural entrepreneurship development and rural
development self employment training institute. The total credit disbursed under these
schemes namely PMRY, SGGSY, SJSRY, and SLRS amounted to Rs.74.10 crore benefiting
13915 persons during the year. Aiming at harnessing solar energy, bank has taken up a project
for financing solar home lighting system in Karnataka state with interest subsidy support
from United Nations environment programme. The bank financed 2f097 solar water heating
system and 669solar home lighting system during the year . The credit support given by the
bank during the year for popularizing solar application amounted to Rs.6.65 crore.

Information Technology:
It policy and strategies adopted by the bank aim at achieving operational efficiency.
Enhancing customer satisfaction and meeting the market expectations. Bank continues to
induct technology to deliver sophisticated product that continuously raise the standards of
customer service .The bank is the first among the public sector banks to implement core
baking solution .During the year, the bank has further consolidated implementation of CBS
by networking 529 branches spread across over 212 centers covering over 60% of the banks
business. During the ensuring fiscal the bank has plans to extend CBS to an additional 1000
branches, thereby taking the total number of branches covered under CBS to over 1500
encompassing 80% of the banks business.The CBS project has enabled the bank to deliver
banking products and services over multiple delivery channels like network ATMs, Tele
banking and internet banking etc. So as to provide Anywhere anytime anyhow banking
service to customers.

HUMAN RESOURCE MANAGEMENT:

The HR policy has been geared to meet the corporate objective of accelerate and profitable
growth. This includes campus and direct recruitment for replenishing skilled manpower in
Agricultural Finance, Information technology, Accounts and Financial management, Internati
business, Credit, Marketing, Risk management etc. As always the industrial Relations in the
Bank have been harmonious and cordial.

NEW PRODUCTS AND SERVICE:

As part of its innovative strategies in product development process, Bank has constantly
reviewed and redefined many of its products to meet ever-changing needs and expectations of
the

customers.

During

the

year

products,namelySyndNivas(Housing

2005-06
Loan

Bank

Scheme),

has

redefined

SyndVidya

several

(Education

exiting
Loan

System),SyndSwarna(JewelLoanSystem),SyndAgro (mediclaim cum personal accident cover

Product).

DIVIDEND:
The board of directors of the bank has declared an interim dividend of 15% during
February2006 and proposed a final dividend of 10% aggregating to a total dividend of 25%
for the Year 2005-2006. The total dividend payment amount to Rs. 148.79 crore (including
interim dividend).

RISK MANAGEMENT:
The bank views risk management as integral to its business for creating and maintaining best
Practices in business operations and administration. The banks objectives and strategies for
Risk management are designed to complement the organizations vision and goals. The
primary Aim of the risk strategy is to maintain the quality of the Assets, while ensuring
continuous Profitability.

BASE II COMPLIANCE:
.The bank considers base I as a business imperative and not as a compliance issue. The bank
has already initiated steps to implement the Standardized Approach for credit risk and basic
indicator approach for operational risk by March 2007.The bank is planning to adopt best
International practices in credit risk management and Basel II implementation by outsourcing
end to end solution viz., on-line appraisal system, risk assessment, risk inputs estimates,
capital computation and RAROC framework. The bank is also in process implement
operational risk management.

NEW INITATIVES:
In its continuous quest for new financial partners, Bank has tied up with National Exchange
Company of Kuwait and Zenj Exchange Company of Bahrain, two popular money
transferring outfits for remittances. Bank signed MOU with SMERA (Small &Medium
Enterprises Rating Agency of India Ltd.) to create a platform for banks SME clients to get
themselves rated and gain concession in interest rates. Bank entered into a MOU with M/s
CMC Ltd with the aim of making Syndicate Institute Of bank management, the Apex training
institute of the bank, a center of excellence of global standard. Under the tie-up arrangements,
the bank will make available the infrastructure, including faculty support, at SIBM and other
Trading Centers and M/s CMC will provide its expertise in course design and training
content, developing appropriate learning aids, including software and generate demand for
training from external sources.

CORPORATE GOVERNANCE:
The bank has adopted a highly effective system of corporate governance to ensure continued
Growth of shareholder value keeping in view the interests of all stokeholds. The system
Permits adequate autonomy to the board of directors and the top management to take decision
that can further the progress of the bank within the framework of regulatory prescriptions,
corporate goals and social responsibility. The audit committee of the board oversees the
quality of the internal audit systems and monitoring mechanism apart from reviewing the
financial accounts. The bank has been actively promoting greater transparency as a part of its
measures through wider disclosure of information that reflects the quality of governance.

Awards Won by the Bank over the Years:

197 INDIAN MERCHANTS' CHAMBER AWARD for outstanding contributions towards
2

welfare of community

197 INDIAN MERCHANTS CHAMBER AWARD for outstanding contribution in

4

promotion of savings

197 FICCI AWARD For outstanding achievements in agriculture

5
197 LAGHU UDYOG SAHAKARI AWARD by the national alliance of young
5

entrepreneurs for bank's significant contributions to the development of small scale

industries and assistance to the young entrepreneurs through self employment clinics

197 INTERNATIONAL AWARD by JAYCEE INTERNATIONAL for self employment

5
197 FICCI AWARD in recognition of corporate initiative in industrial relations
5
197 CERTIFICATE OF MERIT for Bank's house journal "GIANT"
5
197 INTERNATIONAL AWARD by JAYCEE international for outstanding contribution to
6

the cause of the JAYCEE movement

197 ASSOCHAM AWARD for promotion of rural and agricultural activities of Syndicate
7

Agriculture Foundation sponsored by the bank

197 INDIAN MERCHANTS CHAMBER AWARD for outstanding contribution towards

8

welfare of the community

197 NATIONAL TROPHY For outstanding export performance

8
198 NATIONAL INVESTMENT AND FINANCE AWARD for Priority Sector lending.
1
199 CHAUDHARI CHARAN SINGH MEMORIAL NATIONAL AWARD for Rural
0

Development

199 FICCI AWARD for institutional initiative in the field of "Rural Development" to
9

RUDSETI jointly sponsored by Syndicate Bank

2001 Banking Technology Award for innovative use of Banking Applications on INFINET
awarded by IDRBT, Hyderabad
2003 Banking Technology Award conferred on Syndicate Bank by IDRBT, Hyderabad for
2003

2006 "Special Award for Use of IT for Customer Service in Semi-Urban and Rural Areas",
conferred by IDRBT, Hyderabad for 2006
2006 Best Core Banking Project Award for Large Banks in 2006 awarded by The Asian
Banker
2009 Best Performer award by NABARD for Highest Average Loan Size under SHG -Bank
linkage programme among commercial banks operating in Karnataka.

Memorable Milestones in a 82- Year Journey:

192 On 10.11.1925, the business of the Bank commenced in Udupi with the name "Canara
5

Industrial and Banking Syndicate Ltd.," a joint Stock Company with just one
employee.

192 First branch of the Bank opened at Brahmavar in Dakshina Kannada District
8
193 Bank became a member of the Clearing House for the first time at Bombay.
7
194 29 branches opened in a single day in rural areas.
6
195 Took over the assets and liabilities of 2 Local Banks viz. Maharashtra Apex Bank Ltd.
3

and Southern India Apex Bank Ltd. 20 Banks merged with the Bank during the period
1953-1964.

195 100th branch opened at Ilkal in Karnataka

7
196 Entered Foreign Exchange business by opening Foreign Exchange Department at
2

Bombay.

196 Name of the Bank changed from "Canara Industrial & Banking Syndicate Ltd." To
3

"Syndicate Bank Limited". Head Office was shifted to Manipal on 19.4.1964.

196 Economic Research Department set up. One of the first few Banks to emphasize on
6

research in Banking even before nationalization.

196 Bank had 306 branches at the time of nationalization of which 66% were in Rural and
9

Semi Urban centre. Opened a branch at Port Blair in Andaman and Nicobar islands

197 First Staff Training College started at Head Office

0
197 First specialized branch in Foreign Exchange opened at Delhi.
1
197 Opened a branch at Lakshadweep islands
2
197 First overseas branch opened at London on 17.8.76.
6
198 Took up management of Al Shabei Finance and Exchange Co. in Doha
3
198 Took up management of Musandam Exchange Co. in Muscat
4
198 1000th branch opened at Delhi Hauz Khas
4
198 1500th branch opened at Kanakumbi
9
199 First Specialized Industrial Finance Branch opened at Mumbai.
1
199 First Specialized Housing Finance Branch opened at Mangalore
5
199 Bank raised Capital of Rs.125 Crore in Oct.1999 from more than 4 lakh shareholders
9
200 First Specialized Capital Market Services branch opened at Mumbai
0
200 First branch under CBS (Core Banking Solution) started operation at Bangalore.
1
200 Centralised Banking Solution under the brand name "Syndicate-e-banking" launched at
2

Delhi, Mumbai, Bangalore and Manipal.

200 Bank enters into MOU with Bajaj Allianz for distribution of Life Insurance products.
3

200 Toll Free Voice Mail System for redressal of grievances introduced.
3
200 Bank ties up with United India Insurance Co. Ltd. for distribution of Non-Life
4

Insurance products

200 Utility bill payment services through Internet banking introduced.

4
200 Introduced On-line reservation of Railway Tickets through Indian Railway Catering &
5

Tourism Corporation Ltd. (IRCTC) for Internet banking customers of our Bank.

200 Bank approached the Capital Market with Rs.5 Crore equity shares at a premium of
5

Rs.40 through Book building route Bank collected Rs.250 Crore and the issue was
oversubscribed by 29.275 times.

200 Amalgamation of 4 Regional Rural Banks of Karnataka to form Karnataka Vikas

5

Grameena Bank with Head Office at Dharwad.

200 Implementation of Venture Capital Scheme of SMALL FARMERS AGRI-BUSINESS

5

CONSORTIUM (SFAC) Entered into MOU with SFAC for promoting of investments
in Agri-business products.

200 Bank signs MOU with M/s.CMC Ltd., for making Syndicate Institute of Bank
6

Management (SIBM) a center of excellence of global standards and provide quality

management education.

200 500th Branch of Syndicate Bank in Karnataka opened at Navnagar, Bagalkot.

6
200 2000th Branch of Syndicate Bank opened at Tondiarpet, Chennai on 23.03.2006.
6
200 Inauguration of Sandbank Services Limited, the 1st BPO outfit of a Nationalized Bank,
6

a wholly owned subsidiary of Syndicate Bank & 525th CBS Branch by Hon'ble Union
Minister of Finance, Sri P Chidambaram on 24.03.2006 at Bangalore.

200 2006th Branch of Syndicate Bank opened at Gangtok, Sikkim on 27.03.2006

6
200 First Branch opened in Arunachal Pradesh at Ita Nagar on 16th October 2006
6
200 Branches opened for the first time in 19 additional districts

2007 First Branch opened in Nagaland at Dimapur on 17.03.2007

2007 First Branch opened in Mizoram in Aizawl on 29.03.2007
2007 Branches opened for the first time in 13 additional districts
2008 First Branch opened in Tripura at Agarthala on 11.01.2008
2008 Branch network expanded to all States and UTs except Manipur & Daman Diu
2008 Branches opened for the first time in 6 new districts

PIONEER IN RURAL DEVELOPMENT

1926 Established in a rural milieu to financially assist handloom weavers
1964 First Bank to venture into agricultural financing when the Banking system considered it
risky and unconventional.
1966 Promoted Syndicate Agriculture Foundation - a voluntary organization of farmers - to
disseminate scientific farming techniques.
1967 Agri Card - a ready credit facility for farmers - launched.
1973 Bio Gas finance scheme introduced in collaboration with Khadi and Village Industries

Commission to popularize non conventional source of energy. Farm Clinics established.

1974 Syndicate Farmers' Service Society was organized by the Bank in Hiriadka in South
Kanara based on the recommendations of the National Commission on Agriculture.
1975 Sponsored the country's first Regional Rural Bank - Prathama Bank opened on
2.10.1975 - in Moradabad in U.P. Bank has so far sponsored 10 such RRBs which are
all profit making and act as trend setters in energizing the rural economy. After
amalgamation there are now 5 Grameena Banks in 5 states, covering 30 districts
1982 Jointly sponsored the first RUDSETI (Rural Development and Self Employment
Training Institute) at Ujire in Dakshina Kannada (Karnataka). There are 23 such
Institutes in 14 States today providing free entrepreneurship training to unemployed
youth. Intensive Rural Development branches established.
1989 Bank adopted Service Area Villages to bring about around development.
1998 Kisan Credit Card launched
2000 In commemoration of Platinum Jubilee, Syndicate Rural Development Trust established
(to mark the Platinum Jubilee of the Bank) for pursuing rural development initiatives
with initial corpus of Rs. 50 lacs. Opened 8 Rural Entrepreneurship Development
Institutes at Manipal, Kumta, Bellary, Belgaum, Moradabad, Kadapa, Kurnool and
Kollam.
Scheme for financing Solar Water Heating system Launched.
2001 Syndicate Laghu Udyami Credit Card launched.
2003 SSCC: Sind Swarozgar Credit Card- A new product for financing Small Artisans,
Handloom weavers, Fisherman, Service sector, Self employed persons, Rickshaw
owners and other Micro entrepreneurs to meet working capital or block capital or both
and also consumption needs has been launched.
2004 SKSCC: Syndicate Kissan Samrudhi Credit Card- A new product launched for meeting
production and investment credit needs of farmers for agriculture & allied activities and
also to meet their consumption requirements.
2005 Scheme for financing Commercial Horticulture Projects under the schemes of National
Horticulture Board has been launched to encourage farmers to go in for diversification
in

agriculture

essential

for

increasing

their

income

Scheme for financing SC/STs for rainwater harvesting has been launched.
2006 Syndicate
General
purpose
Credit
Card

level.
launched.

Scheme for financing tenant farmers: Two separate schemes have been launched to
provide need based credit to tenant farmers through Joint Liability Group (JLG)
approach as well as individual approach.
2007 "SyndSmallCredit"- an innovative scheme with doorstep banking facility to provide
need-based credit to entrepreneurs of small means. The product part of financial

inclusion,

by

bringing

all

eligible

entrepreneurs

into

bank's

fold.

"Financial Inclusion:" Launched a campaign to achieve 100% financial inclusion. A

booklet containing comprehensive guidelines to augment the process of total financial
inclusion

released.

"Water Conservation initiatives:" To promote Water Management and conservation

measures among the villagers, Bank started initiatives for clearing and cleaning of
village ponds in the selected service area villages.

TECHONOLOGY INITIATIVES
1926 Established in a rural milieu to financially assist handloom weavers
1964 First Bank to venture into agricultural financing when the Banking system considered it
risky and unconventional.
1966 Promoted Syndicate Agriculture Foundation - a voluntary organization of farmers - to
disseminate scientific farming techniques.
1967 Agri Card - a ready credit facility for farmers - launched.
1973 Bio Gas finance scheme introduced in collaboration with Khadi and Village Industries
Commission to popularize non conventional source of energy. Farm Clinics established.
1974 Syndicate Farmers' Service Society was organised by the Bank in Hiriadka in South
Kanara based on the recommendations of the National Commission on Agriculture.
1975 Sponsored the country's first Regional Rural Bank - Prathama Bank opened on
2.10.1975 - in Moradabad in U.P. Bank has so far sponsored 10 such RRBs which are
all profit making and act as trend setters in energising the rural economy. After
amalgamation there are now 5 Grameena Banks in 5 states, covering 30 districts
1982 Jointly sponsored the first RUDSETI (Rural Development and Self Employment

Training Institute) at Ujire in Dakshina Kannada (Karnataka). There are 23 such

Institutes in 14 States today providing free entrepreneurship training to unemployed
youth. Intensive Rural Development branches established.
1989 Bank adopted Service Area Villages to bring about around development.
1998 Kisan Credit Card launched
2000 In commemoration of Platinum Jubilee, Syndicate Rural Development Trust established
(to mark the Platinum Jubilee of the Bank) for pursuing rural development initiatives
with initial corpus of Rs. 50 lacs. Opened 8 Rural Entrepreneurship Development
Institutes at Manipal, Kumta, Bellary, Belgaum, Moradabad, Kadapa, Kurnool and
Kollam.
Scheme for financing Solar Water Heating system Launched.
2001 Syndicate Laghu Udyami Credit Card launched.
2003 SSCC: Synd Swarozgar Credit Card- A new product for financing Small Artisans,
Handloom weavers, Fisherman, Service sector, Self employed persons, Rickshaw
owners and other Micro entrepreneurs to meet working capital or block capital or both
and also consumption needs has been launched.
2004 SKSCC: Syndicate Kissan Samrudhi Credit Card- A new product launched for meeting
production and investment credit needs of farmers for agriculture & allied activities and
also to meet their consumption requirements.
2005 Scheme for financing Commercial Horticulture Projects under the schemes of National
Horticulture Board has been launched to encourage farmers to go in for diversification
in

agriculture

essential

for

increasing

their

income

level.

Scheme for financing SC/STs for rainwater harvesting has been launched.
2006 Syndicate
General
purpose
Credit
Card

launched.

Scheme for financing tenant farmers: Two separate schemes have been launched to
provide need based credit to tenant farmers through Joint Liability Group (JLG)
approach as well as individual approach.
2007 "SyndSmall Credit"- an innovative scheme with doorstep banking facility to provide
need-based credit to entrepreneurs of small means. The product part of financial
inclusion,

by

bringing

all

eligible

entrepreneurs

into

bank's

fold.

"Financial Inclusion:" Launched a campaign to achieve 100% financial inclusion. A

booklet containing comprehensive guidelines to augment the process of total financial
inclusion

released.

"Water Conservation initiatives:" To promote Water Management and conservation

measures among the villagers, Bank started initiatives for clearing and cleaning of
village ponds in the selected service area villages.

Competition

SBI
PNB
Bank of Baroda
Canara Bank
Bank of India
Union Bank
IDBI Bank
Indian Bank
Allahabad Bank
Oriental Bank
Syndicate Bank
SB9

SB9

Last Price

Market

2,596.90
1,125.35
836.80
607.05
460.90
326.60
151.05
220.35
211.85
359.50
106.85

(Rs. cr.)
164,902.66
35,482.57
30,587.55
24,889.05
24,239.19
16,497.15
14,871.34
9,469.98
9,463.34
9,006.90
5,577.23

price

Comparison with Competitors

SB9

SB9

Cap.Net
Income
70,993.92
21,466.91
16,698.34
18,751.96
17,877.99
13,302.68
15,272.63
7,857.06
8,369.20
10,257.12
10,047.17

InterestNet Profit
9,166.05
3,905.35
3,058.33
3,021.43
1,741.07
2,074.92
1,031.13
1,554.99
1,206.33
1,134.68
813.32

Total Assets
1,053,413.74
296,632.79
278,316.71
264,741.09
274,966.46
195,161.85
233,572.01
101,389.32
121,699.21
137,431.00
139,050.94

Balance Sheet

------------------- in Rs. Cr. ------------------Syndicate

SBI
PNB
Bank of Baroda
Bank

Canara B

Mar '10

Mar '10

Mar '10

Mar '10

Mar '10

521.97
521.97
0.00
0.00
4,700.89
404.19
5,627.05
117,025.79
12,172.69
129,198.48
4,225.42
139,050.95
Syndicate

634.88
634.88
0.00
0.00
65,314.32
0.00
65,949.20
804,116.23
103,011.60
907,127.83
80,336.70
1,053,413.73

315.30
315.30
0.00
0.00
15,915.63
1,491.99
17,722.92
249,329.80
19,262.37
268,592.17
10,317.69
296,632.78

365.53
365.53
0.00
0.00
14,740.86
0.00
15,106.39
241,044.26
13,350.09
254,394.35
8,815.97
278,316.71

410.00
410.00
0.00
0.00
12,129.11
2,132.68
14,671.79
234,651.44
8,440.56
243,092.00
6,977.30
264,741.09

SBI

PNB

Bank of Baroda

Canara B

Mar '10

Mar '10

Mar '10

Mar '10

Mar '10

Assets
Cash & Balances with RBI
Balance with Banks, Money at Call
Advances
Investments
Gross Block
Accumulated Depreciation
Net Block
Capital Work In Progress
Other Assets
Total Assets

7,189.12
5,544.73
90,406.36
33,010.93
1,279.20
596.72
682.48
18.95
2,198.37
139,050.94

61,290.87
34,892.98
631,914.15
285,790.07
11,831.63
7,713.90
4,117.73
295.18
35,112.76
1,053,413.74

18,327.58
5,145.99
186,601.21
77,724.47
4,215.21
1,701.74
2,513.47
0.00
6,320.07
296,632.79

13,539.97
21,927.09
175,035.29
61,182.38
4,266.60
1,981.84
2,284.76
0.00
4,347.22
278,316.71

15,719.46
3,933.75
169,334.63
69,676.95
4,480.37
1,620.99
2,859.38
0.00
3,216.92
264,741.09

Contingent Liabilities
Bills for collection

49,817.68 429,917.37
4,993.24 166,449.04

68,124.47
33,215.78

77,997.01
27,949.60

110,627.02
21,206.47

Capital and Liabilities:

Total Share Capital
Equity Share Capital
Share Application Money
Preference Share Capital
Reserves
Revaluation Reserves
Net Worth
Deposits
Borrowings
Total Debt
Other Liabilities & Provisions
Total Liabilities

Bank

Book Value (Rs)

100.06

1,038.76

514.77

414.71

SWOT ANALYSIS:
STRENGHT:
Pan India presence.
Strong rural presence: This is key strength of Syndicate Bank as has strong presence in the
rural India. Rural India is having big growth potential as the urban areas are becoming
saturated and is facing stiff competition.
Implemented IT across the branches.
Centralized banking system.
Government owned bank: This guarantees in todays circumstances the safety of the deposit
and excessive regulations of the government prevent it from taking speculative position.
WEAKNESS:
Not present in big way in urban areas.
Bureaucratic culture still prevailing in the bank.
Excessive movement regulation is hindering the pace of expansion
OPPORTUNITY:
Liberalization of banking sector in 2009 will force the government to deregulate the sector.
Indian bank will have the opportunity to go abroad.
As investors are scurry of private bank in todays circumstances. They prefer PSU bank, this
could be an opportunity.

305.83

THREAT:
Coming of MNC bank post April 2009.
Ongoing economic recession.
Government regulation

Chapter-2

PERFORMANCE APPRISAL

Literature View

Aim
Objective
Purpose
Structure
Limitation
Method
Factor that can distort appraisal

Company View

Evidence recording
KRA
PDS

THE OBJECTIVE PERFORMANCE APPRAISAL FALLS

INTO TWO CATEGARIES
1. Administration Objective

Promotion
Transfer
Training and Development
Wage and Salaries Administration
Personal Research

2. Self Improvement

Performance appraisal is an ancient art-dulewicz (1981) basic Human tendency to make

judgment about those one is working with as well as about on self.

Ethics of performance appraisal

I understand it in the Gandhian sense of All life is a trust and all power carries with its
obligation.
Performance appraisals are an ongoing process and not an isolated art.

Aims:
An appraisal has been seen as an issue in isolation to be held over a mans head like a sword
Damocles. As humble rightly affirms, appraisals are not optional extras, or merely tools of
administration, they must be seen as one part of the total process of improving management
performance which stress a managers role as a helper rather than judge of his subordinates.

Purpose of performance appraisal

1. To establish and uphold the principle of accountability.

2. Performance appraisal can protect the organization todays society is litigious formal
documentation of employees performance is an important protection device. It helps
counter claim of bias as a case of dismissed worker.
3. Performance appraisal offers a valuable opportunity
To focus on work activities and goals.

To identify and correct existing problem.

To encourage better and future performance through effective planning.

4. Recruitment and induction Appraisal data monitors success of organizations

recruitment and induction practices e.g. how well are the employee performing? Who
were hired in the past two years? Monitor effectiveness of change in recruitment
strategy.
5. Performance appraisal determines employees compensation.

STRUCRUE OF PERFORMANCE APPRAISAL

Establish performance standard

Communication performance expectation to employee

Erasure critical performance

Compare actual performance with standard

Discuss appraisal with the employee

If necessary initiate corrective action

LIMITATIONS1. If the factor included in assessment is irrelevant the result of performance appraisal ail
not is accurate.
2. Different qualities to be rated may not be given proper weighted certain in cases.
3. Some of the factors are subjective like initiative and personality of the employees. So
the actual rating may to be on scientific lines.
4. Supervisors often do not have critical ability assessing the staff. Sometimes they are
guide by third personal emotions and likes. So the rating is likely to be biased.

There are various methods of merits rating which may be classified into
1. TRADING METHODS
Unstructured appraisal.

 Employee rating.
Forced distribution.
Graphic rating scale.
Check lists.
Critical incidents.
Field review.
2. MODERN METHOD
M.B.O
Behaviorally anchored rating scale

TRADITIONAL METHODS:
Traditional methods are very old technique of performance of performance appraisal. They
are based on trade oriented appraisal. Evaluation of employee is done on the basis of
standards of personal traits or qualities such as attitude, judgments, veracity, initiative,
dependability, leadership, loyalty, punctuality, knowledge of job etc. are seven traditional
method of appraisal as shown above.

MODERN METHOD M.B.O

1. Superior set objective and issue instruction with no prior discussion with
subordinates.
2. Superior and subordinate agree objective and the jointly.
3. Self generating objective with minimal reference to sourer.

A METHOD USED NOW A DAYS IN ORGANISATIONAL:360 DEGREE APPRAISAL

An appraisal device that seeks performance feedback from such sources as one self bosses,
peers, teams, member, customer, suppliers and the like regaining in popularity . It is called
360- degree appraisal.

USES OF PERFORMANCE APPRAISAL

1.
2.
3.
4.
5.
6.
7.

Compensation
Counseling
Training and development
Promotion
Planning
Retention and discharge
Validation

FACTORS THAT CAN DISTORT APPRAISAL

Error free performance appraisal can only be an idealized model with all being something
less than the optimum errors made during appraisal are:1. LENIENCY ERROREvery evaluator has his/ her own value system which acts as a standard against which
appraisals are made relative to the true or actual performance an individual exhibits
some evaluators mark high and other low. The former is referred to as positive;
eniency error and the latter as negative leniency error.
2. HALO ERRORThe halo error is a tendency to rate high or low on all factors due to the impression of
high or low rating on some specific factors.

3. LOW APPRAISAL MOTIVATION

What are the consequences of appraisal? If evaluator knows that a poor appraisal
could significantly hurt the employees the futures particularly opportunities for
promotion or salaries increase the evaluator may be reluctant to give a realistic
approval.
4. CENTRAL TENDENCY
It is reluctance to make extreme ratings the ability to distinguish between and among
the rates a form of range restriction Rates who are prone to the central tendency error
are those who continuously rate all employees as an average.

EVIDENCE RECORDING
The immediate superior records both the favorable and unfavorable behavior of the
subordinate.

Objective of evidence recording

Identify the development need of the subordinate.

Since everything is put on paper the superior does not have to rely in the memory.
At the time of annual evaluation, the superior will be able to define the rating he

has given to the subordinate.

Evidence recording when consistent removes the regency effect.

Content of evidence recording

Date of the incident.
Critical incidents ( should be a trend and not an exception)
Remarks.

Sources of evidence

Direct- observed by superior

Indirect- evidence collected from the colleagues, supervisors and manager.

The four golden rules of evidence recording

1.
2.
3.
4.

Evidence must be valid.

It has to authentic
Evidence must be in a consistent tern.
Evidence has to be sufficient.

The annual performance evaluation

It has four parts.

Part A-self evolution.
Part B-soupier evaluation.
Part C-recommended potential/ performance strategy.
Part D-overall performance summary.

Midyear review and feedback

The solid line superior does this with inputs taken from the functional superior.

Who rates?
The current supervisor with inputs taken from the functional superior in case of dual
reporting.

For the superiors performance appraisal

1.
2.
3.
4.
5.
6.

Help them to know the employee better.

Identify high performers for advantage and reward
Identify poor performance for counseling.
Improve individual productivity.
Identify training areas.
Improve teamwork.

For the employees performance appraisal

1. Provide employee with recognition for their work efforts social recognition is
incentive in itself.

2. It is a motivational tool existence of a performance appraisal system indicates that

organization is genuinely interested in their individual performance and development.
3. Provide regular and efficient training needs audit for the entire organization and scope
for personal development of employees.
4. Evaluate employees.
5. Help in clear communication of workers experience.

Element of edge
1.
2.
3.
4.

KRA measures.
Target setting.
Evaluation and review mechanism.
Feedback.

KRA Measures
These are the focus areas to which an officer is accountable to and has to deliver during the
year apart from his/ her normal deliverables.
KRA measures are identified by cascading the annual business plan and the balance score
card of the respective division department.
Maximum of 5-10 KRA measure need to be defined for each manager with indicative weight
age attached to ensure prioritization.
All KRA measures should have weighted assigned to them totally to 100%.

Objective

To offer feedback and guidance for the next six year months.
To review performance contracts.

To signal for performance improvement.

To raise bottle necks if any.
To raise alarms.
Helps in preparing for the final year review.

Purpose

Provides basis of improvement in employee performance.

Provides input for compensation decision.

Serves as an input for various rotation and development decisions.

Midyear review and feedback

The solid line superior does this with inputs taken from the functional superior.

THE PROCEDURE
Steps-1(self evaluation)
Each offer shall receive a performance evolution form. After filling up part a, the form is sent
back the superior.

Step-2(Performance evaluation dialogue)

The superior discusses the performance of the subordinate with him/ her performance of the
entire period is reviewed against the agreed KRAs

Step-3(Superior evaluation)
The superior rates the individual KRAs
1. Rating given by functional / previous superior (if applicable)
2. Discussion held with the evaluate. Own face based judgments

Individual KRA performance potential rating category.

5. Outstanding potential

5. Exceptional

5. Very high

4. Very good potential

4. Advanced

4. High

3. Good potential

3. Competent

3. Some

2. Fair demonstrate

2. Improvement needs

2. Yet to

1. Inadequate

1.major potential

Improvement
needed

1.Inadequate
improvement
needed

Step -4 (talent review)

The performance rating and potential it is during the performance appraisal performer
categories are finalized. The individual may also be recognized as a functional expert.

Step-5(Feedback)
After the performance appraisal superior gives a feedback to the subordinate on his key
strength area of improvement.
The evaluate after receiving the feedback signs the document. Discount if any case resolved
in a months time.

Performance contracting
This takes place in detailed discussion between the superior and the subordinate. The target
for the various KRAs are decided upon the HR manager is also involved. The performance
contract form is a signal document.

All the KRAs divided into 5 areas

1.
2.
3.
4.
5.

Finance
Customer
Internal business process
People development
Special project

Normalization

At end of performance appraisal we arrive at a normal distribution of posterities &

performance category. Such a distribution is not always possible. He curves come be sked
depending on the composition of cares being discussed.

Performance Management System

1-PDS

2-KRA
*Stretch target
*Midyear fixation
*Talent review
*Feedback
*Result
*PDS- Performance development system
*KRA-KEY result area.

CHAPTER-3

RESEARCH METHODOLOGY

Objective
Data Collection
Sample
Techniques used
Used for Data Analysis

Research Methodology

Research means scientific search for pertinent information on a specific and specific topic.
According to Clifford woody research comprises defining a redefining problems formulating
hypothesis or suggest solution collecting organizing and evaluating data making deduction
and researching conclusion and at carefully testing the conclusion to determine whether they
fit the formulating hypothesis.

Objectives of a Research

To gain familiarity with phenomenon or to achieve new insight in to it.

To portray accurately characteristics of a particular.
To determine the frequency with which something occur or with which it is

associated with something else.

To test a hypothesis of a relationship between variables.

Data Collection
After research problem has been defined and research design is chalked out, data is collected
through different sources. Basically data collection is two types

Primary Data

Questions
Observations
Personal interview
Schedule depth interview

Secondary Data
For secondary data I referred to the to the company profiles, literatures,
periodicals, internet etc.

Data Collection Techniques Used

The analysis is based on purely on primary data collection for the purpose, data
collection was help of following technique.

1. Through personal interviews method

Offer gives relevant fact concerning the topic by conversing with them.
2. Through questionnaire method
The relevant figure was collected by securing the answer to the question after
distribution of questionnaire to the offer.

Data analysis
Data analysis is very important for any research work this is because any mistake in the
analysis part will make the whole interpretation wrong and the finding will be vague we have
used linkers technique for scaling of question number one charged scen

Questionnaire

Personal identification:1.
2.
3.
4.
5.
6.

Name
Age
Sex
Year of service.
Department.
Designation.

1. Performance appraisal is given adequate important in your department.

Always/ sometime /never/ mostly/ most of time
2. Is it being used as a tool for development for development of subordinates?
Always/ sometime / never/ mostly/ most of time
3. To what extent did the performance appraisal program meets the career advancement
needs of the subordinates.
Always/ sometime / never/ mostly/ most of time
4. Do you have a clear idea of your job requirement & job responsibility?
Always/sometime/ never/ mostly/ most of time
5. To what extent do you about personal & behavioral factor provide superior basis for
improving work relationship and team effectiveness.
Always/ sometime / never/ mostly/ most of time
6. Does age or seniority giving any weight age for performance appraisal?
Always/ sometime /never/ mostly/ most of time
7. Do you have freedom to introduce any change or innovations in the department?
Always/ sometimes/ never/ mostly/ most of time
8. Are you fully satisfied in your present job?
Always/ sometime/ never/ mostly/ most of time
9. Does your superior frank enough to tell you what he thinks about your performance?
Always/ sometime/ never/ mostly/ most of time
10. Do you get the support of your superior about responsibility on which you need to
improve?
Always/ sometime/ never/ mostly/ most of time
11. Do you feel a need that your development is essential for the improvement in
performance of the department?
Always/ sometime/ never/ mostly/ most of time
12. Do your superiors take care of your development need through the appraisal system?
Always/ sometime/ never/ mostly/ most of time
13. Do you feel that it the responsibility of your superior to look after your development
need?
Always/ sometime/ never/ mostly/ most of time
14. Does the present appraisal system fulfill the objective of the organization?
Always/ sometime/ never/ mostly/ most of time
15. The best performance is identifiable in department. Is everyone is clear about the
judgment of their performance?
Always/ sometime/ never/ mostly/ most of time
16. Do you believe that self development is the best way of development?

Always/ sometime/ never/ mostly/ most of time

17. Do you like to suggest any change in the present appraisal system available in the
organization?

Q. Does performance appraisal is given adequate in your department?

aiways
mostly
most of time
some time
never

Q.To what extent did the performance appraisal programme meets the career advancement
needs of the subordinates?

aiways
mostly
most of time
some time
never

Q. To what extent do your personal and behavioral factors provide superior a basis for
improving work relationship and team effectiveness?

aiways
mostly
most of time
some time
never

Q. Does age or seniority given any weight age for performance appraisal?

aiways
mostly
most of time
some time
never

Q. Do you have freedom to introduce any changes or innovations in your department?

aiways
mostly
most of time
some time
never

Q. Are you fully satisfied in your personal job?

aiways
mostly
most of time
some time
never

Q. Does your superiors frank enough to tell you what he thinks about your performance?

aiways
mostly
most of time
some time
never

Q. Do you get support of your superiors about responsibilities on which you need to
improve?

aiways
mostly
most of time
some time
never

Q. Do your superior take care of your developmental need through the appraisal system?

aiways
mostly
most of time
some time
never

Q. Do you feel that it is the responsibilities of your superior to look after your developmental
needs?

aiways
mostly
most of time
some time
never

Q. Does the present appraisal system fulfill the objective of the organization?

aiways
mostly
most of time
some time
never

Q. The best performers are clearly identifiable in department. Is everyone is clear about the
judgment of their performance?

aiways
mostly
most of time
some time
never

Q. Do you believe that self- development is the best way of development?

Always
mostly
most of time
sometime
never

Findings
1. Formal and specific finding need to be given at an interval of a months

2. Employees are likely to feel more satisfied with their appraisal result if they have
change to talk freely and discuss their superior.
3. Feedback should take place an informal and congenial atmosphere and sufficient
time should be kept a side for it.
4. Employees must recognize must recognize that negative appraisal is provided with
a construction intention.
5. Feedback should be discussed on ongoing basis throughout the year.

CHAPTER-4

Conclusion
An effective appraisal system helps the employees to see the an effective appraisal system
help the employees to see the linking between efforts & performance and between

performance and reward they value. When performance appraisal are conducted properly
both supervisors & subordinates have reported the experience as positive & beneficial. The
present performance appraisal system answers the following questions by the following
question asked by all employees:

Tell me what you want me to do?

Tell me how well I have done it?
Help me improve my performance?
Reward me for doing well.

The concept of higher level review is a resent on, so the process will take time to mature.
However, HR has a major role to play in insuring that there is timely & uniform adherence to
the process.

SUGGESION
The performance appraisal system could be made consistent in order to bring about stabilized
standard of rating.

Objective of the system:

The result of performance rather than personality traits should be given due with suggestion
for improvement should be directed toward objective facts of the job (such as work
schedules, output, reports completed, accomplishment etc.) the individual as a person never
be criticized.
The superior play as a dual and conflicting role of both judge as well as a guide / mentor to
the appraise. At a times appraiser also feel that subordinate appraisal is not rewarding. This
comes the way of an effective system. To avoid this leader could function more as collogues
rather than judges. Subordinates officers could also give their feedback on their superiors to
create an atmosphere of confidence and trust so that both appraiser and appraise can discuss
matters can frankly and offer suggestions which may be beneficial for the organization and
for an improvement of both the officers. Thus transparency in every aspect of the system is
maintained.
A post appraisal interview should be arranged for all officers so that the organization by the
difficulties under which officers workers, so the proper training needs may be discovered.
Counseling session should be held not only while providing feedback appraisal, but as
frequently as possibly as possible aiming at support and encouragement. Such session must
include discussion on career development, which could be conducted in group or a one to one
basis.

Bibliography
1. Human Resource Management
By T.N.Chabra.
2. The Management of Human Resource.

By Robbins,Stephen P.
3. Personal Management
By Mamoria.
4. Personal Management & Industrial Relation.
By Yoder, Dale
5. SB Magazines

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