How to Cite:

Dhawan, V., & Verma, R. (2022). Comparative study of performance appraisal practice in public
sector and private sector banks in Haryana state. International Journal of Health Sciences, 6(S4), 902–
911. https://doi.org/10.53730/ijhs.v6nS4.5785

Comparative study of performance appraisal

practice in public sector and private sector
banks in Haryana state

Vikas Dhawan
Ph.D. Research Scholar, Maharishi Markandeshwar (Deemed to be University),
Mullana, Ambala, India
Email: [email protected]

Dr. Ranjeet Verma

Faculty of M.M Institute of Management, Maharishi Markandeshwar (Deemed to
be University), Mullana, Ambala, India
Email: [email protected]

Abstract---Performance assessment or evaluation measure is

probably the most ideal approaches to further develop competence or
expertise inside the business. A reasonable procedure performed at
normal spans aids job satisfaction and upgrades corporate efficiency.
Performance evaluation gives noteworthy as well as valuable
framework for determining the competencies, awareness, confidence
and entire work effectiveness of personnel. Evaluation system enables
a supervisor to discover whether his existing work output requires
extra workshop or not to boost the efficiency of individual. The
effectiveness of talent acquisition strategies deployed at workplace is
evaluated through assessment system. The program allows
supervisors and staff to detect problem areas quickly by outlining
precise objectives for individuals and formulating guidelines for
superior work quality. Assessment System offer the individual and the
administrator with a turning point in spotting and analysing issues
for improving the efficiency. It may serve as a significant possibility to
boost & clarify personnel & supervisor aspirations.

Keywords---performance evaluation, banks, personnel.

Introduction

Performance assessment or appraisal is a standardized procedure wherein a

superior evaluates an individual member’s temperament & effectiveness toward
established criteria like professional skills, consistency, productivity, competence,
perception, participation, teamwork, adjustability, fitness, sense of responsibility,

International Journal of Health Sciences ISSN 2550-6978 E-ISSN 2550-696X © 2022.

Manuscript submitted: 18 Feb 2022, Manuscript revised: 9 March 2022, Accepted for publication: 1 April 2022
902
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decision making etc. (Yadav, P. K. (2014). It is designed to determine individual's

talent and expertise in order to plan for subsequent improvement and
advancement. Its purpose simply to determine the individual staff member value
to the employer or enterprise (Rani, L .(2014) Appraisals or assessments system
are composed of pre-determined parameters that typically deployed to ascertain
workers' task performance with the findings being given to the staff member as
positive response or criticism (Dave, S. R. (2012). Managers can use an evaluation
tool to aid in the decision-making phase for employee pay, development and
dismissal. It must be centred on reciprocal confidence and integrity. An
assessment system performs effectively whenever the supervisor and personnel
are mutually aware, recognize and appreciate one another. Suitable environment
should be developed gradually, with the supervisor leading the charge (Purang, P.
(2014). With a decent comprehension of how someone is performing towards
output benchmarks, it ought to be not difficult to recognize and focus on
instructions or development initiatives that will assist them in accomplishing the
corporate objectives.

For organizations with output award approach, a structured evaluation procedure

is extremely significant. Compensation may be used as income raises, extra pay-
outs or perhaps various perks, but non-monetary benefits could be gifts, better
positioning, better exciting and creative chances. Assessment strategies should be
established so as to take optimum utilization of personnel capabilities &
initiatives. Low productivity assessments tend to deception for everyone, although
it is reasonable to suppose that assessments might end toward a terrible attitude
or ruin the connection if not properly handled. Supervisors must show confidence
& transparency while assessing the employees' competence. Constructive
strengthening of intended attitudes helps to personal and corporate growth. The
aim of the review is to promote continuous improvement while also addressing
negative results. The constructive intention of assessment will help to discover
aspects where the individual would like to progress.

Impact of Performance Appraisal Practice on Employees

Performance assessment is really an appealing instrument for workforce since it

may increase accuracy and output levels by analysing the quality performance
and compensation scheme once the target is achieved (Chaudhary, T. S., &
Krishna, K. (2013). If the mechanism of measuring efficiency is implemented
successfully, it could provide a significant platform to strengthen a corporate
environment in which every worker operates in accordance with the general
strategy of the company (Sharma, A. (2018). Evaluation stimulates recognition of
the contributions & accomplishments of personnel. It drives people to gain unique
capabilities which help individuals to master themselves as well as their careers
(Mahalawat, V (2012). Individuals oppose the evaluate on system when
individuals believe that the entire evaluation procedure is intended just to
demonstrate their failures and condemning their presentation. Accordingly, the
workforce denied to take part in assessment system (Neely, A. (2015). Personnel
find formative assessment to be motivating since the procedure of evaluating
progress and the reward structure upon accomplishing goals will enhance
individual’s quality and competitiveness (Murthy, R. (2015).
904

Virtues and drawbacks of Performance Appraisal

It outlines the position as well as standing of individual in the enterprise. Many

employees desire to hear exactly how they're doing at the workplace and how
additionally they contribute in the organisation. Workforce inadequacy is detected
by appraisal, which then recommends or propose remedial action. The
assessment is also significant in terms of detecting individuals who aren't even up
to mark with the corporation expectations. On the off chance, an individual
performs poorly, the evaluation is the appropriate moment for discussing the
existing knowledge deficits and learning requirements will boost productivity. Top
achievers receive good rewards and incentives. Furthermore, the staff trailing
short are being reprimanded. Oftentimes, professional or experienced supervisors
cannot administer an evaluation process Ahmad, I (2018).

Due to an absence of assessor expertise and competence the assessment

procedure would n't seem be conducted appropriately. The close bond between
the appraiser and the individual significantly influences the assessment
Supervisors will occasionally provide better grades to their favourite staff member
or will likewise provide negative assessments to good performers out of rivalry or a
threat of being replaced (Rao, T. V. (2014). The appraisal procedure is likewise
influenced by the bosses' viewpoint. Supervisors that are tough but have great
aspirations of their staff members might provide negative scores to all personnel,
even though they are performing well. Merciful supervisors that are tolerant
provide excellent grades to everyone, regardless of their presentation/productivity.
These ratings are neither beneficial to the institution nor to the personnel.

Review of Literature

Elif Ozturk & Ali Coskun (2014) fair scorecard or evaluation matrix is quite
effective in the banking industry for efficiency evaluation. Results revealed that
constructing a scorecard for financial institutions is much more advantageous
than simply reporting monetary outcome when it comes to analysing efficiency
holistically. Chowdhury (2018) One of the most significant aspects of Performance
management system is the efficiency evaluation framework. The financial industry
is such area where evaluation techniques are given a lot of consideration. Few
financial institutions had modified or currently transforming their performance
assessment structures. T. V. Rao (2014) Financial institutions who had recently
altered its evaluation processes typically use both efficiency and attribute based
assessments. Some banks use self-examination as basis for employee efficiency
evaluation and generally such examinations are the correspondence of
accomplishment. Huselid, M. A. (2017) in his research focused on the value of
high-performance working practices and stresses that high-performance working
practices structures and corporate performance are related. Proper investment in
these activities has resulted in decreased turnover of staff, greater profitability
and financial success of companies. The effect of high-performance practices on
corporate budgetary performance is to some extent because of their impact on
employee's turnover and profitability. It is inferred that the simple appropriation
of such practices is a higher priority than some other initiative. Thakur, Y. S.
(2016) performance assessment as a cycle to further develop worker's job
efficiency by aiding them understand and involve their maximum capacity in
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doing the association's targets and to give data to representatives and

administrators for use in settling on business related choices and proceeds to
characterize viable evaluation framework as an activity in perception, internal
interaction and an authoritative intercession. Richard, O. C., Johnson, N. B.
(2019) in his observational investigation looked at performance evaluation
practices and the organization value in India among international and national
firms in India. Human resource management, as a long-term methodology,
assumes a significant job in making and building up an association's upper hand
in the corporate world. Adding value is another enthusiasm for human resource
management, as employees increase the value of their associations with high-
efficiency development. Ahmad, I., Danish, R. Q., Ali, S. A., Ali, H. F., &
Humayun, A. A. (2018) demonstrates that banking institution assessment
technique for evaluating employees is still not convincing, and the banking
policies are not being implemented precisely. Notwithstanding the reality that the
compensation package has a positive effect on personnel, it is still inadequate to
achieve the desired results. Incentives must be awarded based on personnel
engagement and distributed evenly across members, without any prejudice or
partiality, in order to stimulate personnel to execute effectively. Aside from
incentives, assessment protocols, and supervisor satisfaction levels, upper
management should evaluate various critical aspects like supervisor attitude,
workplace conditions, and associated behaviour that can help boost staff
efficiency and increase personnel job pleasure. Abdalkrim, G. M. (2012) This
research was aimed at researching the effect on the organization's success in the
Saudi banking sector of human resource management practices. The research
focused on seven HRM variables: preparation and growth, performance
evaluation, productivity, compensation, work rotation, decision taking
engagement and program selection. In order to evaluate all seven variables, the
data collection instrument was a questionnaire focused on inferential statistics
and correlation. The surveys included 125 participants, using survey random
method from all banks functioning in Saudi Arabia. The outcomes showed that
the 07 factors of HRM strategies emphatically correspond to organisation
efficiency. Rani, L., Kumar, N., & Kumar, S. (2014)., characterizes appraisal as a
method of evaluating a worker's recent or earlier output in reference to an
individual's statistical parameters. Assessments comprise analysing the
individual’s true results in relation to the criteria in question, fostering workplace
principles and delivering recommendations to the individual in order to inspire
him or her to improve. Shrivastava, P., & Kiran, U. (2012) evaluation mechanisms
routinely analyse prior conduct and appropriately gives a chance to refocus on
previous results of the bank representatives. To be fruitful they ought to likewise
be utilized as a stage for making advancement and reform designs and should
agree about what ought to be performed in coming decades to upgrade the bank's
adequacy. Vikram Jeet, & Sayeeduzzafar. (2019) The study showed that human
resource management activities such as recruitment, performance evaluation,
teamwork and compensation have a large effect on employee performance with
the calculated regression model. On the other hand, the involvement of workers
has no major effect on HDFC bank staff performance.
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Purpose of Research

i) To examine the prevailing performance assessment system dominant in the

publicly owned and privately owned sector banks.
ii) To contrast the performance assessment system of publicly owned and
privately owned sector banks.

Hypothesis

The underlying null hypotheses were constructed to be investigated in study,

bearing in mind the research's aims:
Ho (1): In perspective of performance appraisal on different criteria, there is no
critical difference among publicly-owned and privately-owned segment banks.

Research Methodology

Non- Probability Convenience sampling is applied to collect the data from the
respondents. Quantitative and qualitative statistics have been considered in
analysis. The original or fundamental data was obtained by self-designed
questionnaire on 300 bank employees (150 each) from the government owned
(State bank of India, Punjab national bank and Bank of Baroda bank) and
privately owned (Axis, Icici and Hdfc Bank) commercial banks in Kurukshetra,
Karnal, Kaithal, Ambala and Yamunanagar cities of Haryana. Auxiliary
information was accumulated straightly from assorted optional outlets like
quarterly statements of Commercial institutions, correlated literature, papers,
documents, scholarly articles, official records, websites, blogs, statistical records
and academic research etc.

Analysis of Data

Table 8.1 Bank have satisfactory performance evaluation framework.

Banks N x̄ Σ σx̅ t p value

Public 1.639 .102
Sector 150 3.8733 1.14866 .09379
Banks

Private
Sector 150 3.6533 1.17574 .09600
Banks

Table 8.1 which has portrayed the employee’s perception toward the performance
assessment framework. The mean value of publicly-owned banks is 3.8 and 3.6 of
privately-owned segment banks and noteworthy value of t is .102 which is higher
than .050 (5% significance level) which means that there is no substantial
disparity on this criterion and banks employees of both segments ‘banks
perceived that their institutions have satisfactory performance assessment
framework. Performance assessment system of both banks build up a distinctive
 907

linkage across productivity and assessment, dispersing perks on a reasonable

and impartial manner and creates prospects for professional advancement.

Table 8.2 Nepotism/discrimination in banks affect performance evaluation.

Banks N x̄ Σ σx̅ t p value

Public
Sector 150 2.2600 1.52311 .12436
Banks
1.184 .237
Private .2246
Sector 150 2.4533 1.4983
Banks

Table 8.2 which has portrayed low rating being given by the bank employees to
their banking institution regarding discrimination in performance review. The
mean value of public sector banks is 2.2 and 2.4 of private sector banks and
significant value of t is .237 which is more than .050 (5% significance level) which
implies that there is no critical contrast on this criterion of performance
appraisal. It signifies that both area banks have made a reasonable assessment
structure for all supervisors to comply and educate them on the most proficient
method to apply it, instead of passing on the assessment to their own tact or
judgement. This design contributes to the authenticity of assessments.

Table 8.3 Performance appraisal report/result help in enhancing performance at

work.

Banks N x̄ Σ σx̅ T p value

Public
Sector 150 4.2533 .63655 .05197
Banks
1.635 .103
Private
Sector 150 4.1467 .48309 .03944
Banks

Table 8.3 which has portrayed high ratings being given by the bank employees to
their association vis-à-vis performance appraisal aids in enhancing work
performance. The mean value of publicly-owned banks is 4.2 and 4.1 of privately-
owned banks and noteworthy value of t is .103 which is more than .050 (5%
significance level) which means that there is no substantial variance on this
criterion of performance appraisal and employees of both segment banks are
acknowledge that assessment report results in enhancing the performance. It
illustrates that both segment banks will value their personnel efforts, and
encourage them to strive towards institutional objectives.
908

Table 8.4 The performance evaluation method offers a chance for self-
examination.

Banks N x̄ Σ σx̅ t p value

Public
Sector 150 4.4400 .58482 .04775
Banks
.563 .574
Private
Sector 150 4.4000 .64506 .05267
Banks

Table 8.4 demonstrated the perception of banking personnel that performance

assessment offers a chance for self-examination. The mean value of publicly-
owned banks is 4.4 and 4.4 of privately-owned banks and noteworthy value of t is
.574 which is greater than .050 (5% significance level) which means that there is
no remarkable variation on this criterion of performance review. This signifies
performance evaluation allows personnel to recognize their qualities and
shortcomings and gives realistic perspective of their productivity.

Table 8.5 Satisfaction with the current method performance appraisal.

Banks N x̄ Σ σx̅ T p value

Public
Sector 150 3.8800 .91900 .07504
Banks
1.396 .164
Private
Sector 150 3.7267 .98237 .08021
Banks

Table 8.5 demonstrates, the mean value of publicly-owned banks is 3.8 and 3.7 of
privately-owned banks and substantial value of t is .092 which is more than .050
(5% significance level) which signifies that there is no weighty difference on this
criterion of performance assessment and personnel of both banking sectors are
gratified with the contemporary system of performance evaluation. The
impression of reasonableness towards the performance evaluation is weighty for
accomplishing representative's gratification.

Hypothesis Testing

Sr. Statement p value (5% Hypothetically

No. Significance Accepted/Rejected
level)
1. Bank have satisfactory performance 1.639 Accepted
evaluation framework
2. Nepotism/discrimination in banks .237 Accepted
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affect performance evaluation.

3. Performance appraisal report/result .103 Accepted
help in enhancing performance at work
4. The performance evaluation method .574 Accepted
offers a chance for self-examination
5. Satisfaction with the current method .164 Accepted
performance appraisal

Findings

 The outcomes demonstrates that 127 (84.67%) participants from publicly

owned bank and 119 (79.33%) participants from privately owned banks are
agreed with the statement and perceived that both banks have satisfactory
performance evaluation framework and there is no substantial disparity
between these two banks on this criterion and null hypothesis is accepted.
 The outcomes demonstrates that 129 (86%) participants from publicly owned
bank and 121 (80.67%) participants from privately owned bank are not agreed
with the statement and perceived that discrimination in banks does not affect
performance evaluation and there is no substantial disparity between these
two banks on this criterion and null hypothesis is accepted.
 The outcomes demonstrates that 141 (94%) participants from publicly owned
bank and 133 (88.67%) participants from privately owned are agreed with the
statement and perceived that performance appraisal report or outcomes help
in enhancing performance at work and there is no substantial disparity
between these two banks on this criterion and null hypothesis is accepted.
 The outcomes demonstrates that 128 (85.33%) participants from publicly
owned bank and 119 (79.33%) participants from privately owned bank are
agreed with the statement and perceived that they are satisfied with the
current method performance appraisal and there is no substantial disparity
between these two banks on this criterion and null hypothesis is accepted.
 The outcomes demonstrates that 125 (83.33%) participants from publicly
owned bank and 117 (78%) participants from privately owned bank are agreed
with the statement and perceived that performance evaluation method offers a
chance for self-examination and there is no substantial disparity between
these two banks on this criterion and null hypothesis is accepted.

Conclusion

Performance assessment is a valuable instrument for assessing a staff's degree of

consistency and an integral mechanism that allows personnel to convey the
growth requirements more freely. Towards a broader knowledge of forthcoming
demands of personnel and actions for their attainment, the results of the
evaluation conversation must be conveyed. The outcome of the examination gives
thorough comprehension about the individuals that they have reasonable insight
or rational perspective about performance ratings. This likewise uncovers that
respondent recognized that performance rating reports are reliable and crucial
towards individual productivity and there is no noteworthy disparity in
performance appraisal practice when contrasted between privately owned and
publicly owned banks.
910

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