Lessons For The IAF From The Corporate Sector Commerce Essay


The performance appraisal systems of almost all the corporate sector companies studied under chapter 3 are complete performance management systems rather than just appraisal systems. The evolution of the concept of performance management as a new Human Resource Management model reflects a change of emphasis in organisations away from command and-control towards a facilitation model of leadership.1 This change is accompanied by concepts such as employee first, customer second2 and further deriving the employees' goals and objectives from their departments, which in turn support the mission and goals of the organisation.

Performance Appraisal vs Performance Management

Often the distinction between performance management and performance appraisal is not clearly understood. Performance appraisal is one component of the Performance management cycle and is the process of assessing an employee's performance in the current position. Thus 'Appraisal' is an annual affair while performance 'management' is a year round activity. Appraisal focuses on ratings while 'management' focuses on the work, the stakeholders, service levels, productivity, motivation effort and all such performance related variables. The following table3 highlights the difference between performance appraisal and performance management.

Joint and Unambiguous Goal Setting

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The performance management process provides an opportunity for the employee and performance manager to discuss development goals and jointly create a plan for achieving those goals. Development plans should contribute to organisational goals and for the professional growth of the employee. In the absence of such a system, staff members are unclear as to the employer's expectations regarding performance objectives and required standards/targets, leading to low productivity, costly mistakes, stress, de-motivation, and conflict. Sound performance management systems subscribe to the crucial Principle: "What gets measured gets done". The days of having a "one-set-of-measures-fits-all" Performance Management Systems are inherently flawed and long gone. Performance objectives and measures need to be specific to job categories and individual roles.

360 Deg Appraisals

4. The major lesson that emerges from the corporate world appraisals is the 360 deg approach to appraisals. This technique is effectively used across the globe for performance appraisals. Some of the organisations following it are Wipro, Maruti Udyog, Infosys, Reliance Industries etc. A 360 degree feedback, also known as 'multi-rater feedback', is the most comprehensive appraisal where the feedback about the employees' performance comes from all the sources that come in contact with the employee on his job. 360 degree respondents for an employee can be his/her peers, managers (i.e. superior), subordinates, team members, customers, suppliers/ vendors - anyone who comes into contact with the employee and can provide valuable insights and information or feedback regarding the "on-the-job" performance of the employee. Interestingly most experts agree that 360 deg appraisals have their roots in the military context. During the 1950s and 1960s this trend started in the US, when at the United States Naval academy at Annapolis, the midshipmen used a multisource process called "peer grease" to evaluate the leadership skills of their course mates. 360 degree appraisal has four integral components:

(a) Self Appraisal. Self appraisal gives a chance to the employee to look at his/her strengths and weaknesses, his achievements, and judge his own performance.

(b) Superior's Appraisal. Superior's appraisal forms the traditional part of the 360 degree performance appraisal where the employees' responsibilities and actual performance is rated by the superior.

(c) Subordinate's Appraisal. Subordinates appraisal gives a chance to judge the employee on the parameters like communication and motivating abilities, superior's ability to delegate the work, leadership qualities etc.

(d) Peer Appraisal. Also known as internal customers, the correct feedback given by peers can help to find employees' abilities to work in a team, co-operation and sensitivity towards others.

5. A 360 degree performance appraisal is also a powerful developmental tool because when conducted at regular intervals, it helps to keep a track of the changes others' perceive about the employees. A 360 degree appraisal is generally found more suitable for managers as it helps to assess their leadership and managing styles.

Multiple Assessments

6. Multiple assessments has also been found to be an emerging trend in the corporate sector. Development being the key issue, for an organisation a multiple assessment system helps in furthering goal-setting and relationship building, and employees recognise it as a career development/enhancement exercise. It is also also referred to as the mid-year update.4 Though the assessment itself maybe at year end, the quarterly/mid-year reviews help in checking and alligning the process of goal management.

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7. Experts believe that the trend of multiple assessments will continue to increase in the near future. While the systems are expected to become online, simpler and shorter, the focus will be more on performance assessment than personality attributes. Significantly, present performance is going to be the key focus area than potential performance. However, not everyone is convinced companies need to conduct more frequent performance appraisals. Dick Grote, a performance management consultant for some 30 years and author of several books on the subject, says frequent, informal contacts and feedback are just fine. However, in order to do them right, performance appraisals must be done only once a year, he adds. "One of the most effective ways for a manager to build performance is to have an informal conversation every two or three months," says Grote. "If companies would do that more, we'd get significant increases in performance -- and fewer sleepless nights with people thinking, 'Am I really doing what my boss wants me to do?' If somebody is a little bit off, you can catch it in time. A little course correction is easier than a big one."

Transparent Systems/Feedback

8. Corporate sector performance systems are completely transparent and open with the appraiser and the employee discussing the relevant issues on a frequency ranging from quarterly to midyear. This helps the employee gauge his present status in very clear terms, and helps both the individual and the organisation. In fact, taking cue from the practice followed in most top private companies, the Ministry of Personnel, Public Grievances and Pensions has also done away with the confidential nature of the performance appraisal system and has made the process more consultative and transparent.

Dedicated HRM Departments

9. Corporate sector companies take their performance management systems very seriously and subject them to constant reviews and updates in light of the constantly changing organisational requirements. Dedicated HR managers , experts and even consultant companies are hired to study the organisations and develop their systems. The systems developed are user friendly easily accessible and most importantly, transparent.

Recommendations for IAF

10. A good performance appraisal system is a an essential precondition for an effective performance management system. The existing performance appraisal system can borrow from the corporate sector on the following lines.

11. Goal Setting. Performance appraisal systems for IAF officers should start with specific and unambiguous goal setting. The existing system of quarterly counselling can be modified to a discussion session at the beginning of the appraisal period in which the IO and appraisee can jointly decide on the goals for the officer, for his personal and organisational development. The goals must be clearly quantified or described if qualitative. The agreement could also be signed and physical and verifiable goals should be recorded, to be checked later at the time of appraisal. Once the goals are clear, following up the progress can be done during the subsequent quarterly counselling sessions.

12. Transparency and Feedback. Performance appraisal should be year round. Feedback on the officer's performance can be clearly brought out to him during the quarterly counselling sessions. A formal feedback from Air HQs can also be provided more frequently, to help the officer assess whether his quarterly counselling matches his assessment. This would help create more objective and transparent appraisals on the part of appraisers themselves.

13. 360 Deg Assessments. A 360 deg assessment from self, superiors, peers and subordinates would provide the benefits of a complete and comprehensive appraisal of an individual. It would encourage positive behavioural changes and also provide a valuable input on the leadership qualities of officers at various levels. The method and specifications of introducing this method into the IAF would require a careful and thorough study of various factors by a team of HR specialists, as it would be a drastic change from the top down approach, which up till now is considered to be ideally suited for a military environment.

14. Training Appraisers and Appraisees. Appraisal workshops for IOs are conducted regularly. However, the training of appraisees could also be made mandatory, as most of the officers are not very thorough with the details of the appraisal process and the attributes on which they are judged.

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15. Comprehensive Performance Management System. The IAF should expand the scope of the present performance appraisal system of its officers to a comprehensive performance management /performance and development system . In implementing this, it must be emphasised that the system should be designed within the overall strategic framework appropriate to the particular branch, unit, station etc. It is also necessary to link individual contributions to strategic objectives of the organisation. It will therefore be necessary for each branch/unit to customise its system relevant to them.

16. HR consultants. Since there is no branch in the IAF that is qualified on HRM practices, consultants/experts may be used to devise a performance management system, suitable to our requirements.

17. Human Resource Management through an efficient, performance and goal oriented appraisal system would go a long distance in creating a more satisfied and efficient work force. Ignoring the requirement to evaluate, change and reform the present methods of appraisal in the IAF would be at the peril of losing a large skilled and trained workforce. Accurate and open appraisals also assist in personal and individual growth which in turn means organisational growth. The IAF must be competitive and driven when it comes to it's most valuable asset - it's manpower.


1. Report on performance management system in Govt of India.

2. HCL Technologies.

3. Michael Armstrong & Angela Baron. Jaico Publishing House. 2002 & T VRao."Performance Management of the Civil Servants"

4. Honeywell, HPD.