Uninion & Citi Bank

8/3/2019 Uninion & Citi Bank

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INTRODUCTION:

The scope of this research is to study the appraisal systems of two organizations and thencompare them. The organizations that we chose were Union Bank and Citibank, ourfocus being the latter. Both the banks are highly renowned and are rated in the top 10, in

Pakistan. Both the banks are functioning effectively due to which we decided to take upthis challenge.

The aspect we chose to study in-depth was how effectively both the banks evaluate theiremployees at all levels. It is a future oriented activity that provides staff members withuseful feedback and coaches them to higher level of performance. It is the process in anorganization whereby each employee is evaluated to determine how he or she isperforming. Employees seek feedback on their performance as a guide to future obviousamong newcomers who are trying to understand their jobs and the work settings. Anexercise typically done once or twice a year to identify and discuss job relevant strengthsand weaknesses of individuals or work team.

This aspect was chosen specifically, because of the upcoming trend of privatization, dueto which the efficient blending of skills and knowledge has become a necessity.

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LITERATURE REVIEW:

A formal process in an organization whereby each employ is evaluated to determine

how he or she is performing. (De Cenzo/ Robins)

Performance appraisal is the process by which organization evaluate job performance.

(William B. Werther, JR. and Keith Davis)

Performance appraisal are designed:

To provide feedback on an employees past performance,

To assist in the development of the future plans, and

To provide supportive documentations for personnel decision.

Performance appraisals must convey to employees how well they have performed on

mutually set goals and measures. Superior performance is critical to an organizationssuccess. Yet the typical painstaking performance appraisal process, with its piles of paperand complexity, is an unhappy exercise.

Employees seek feedback on their performance as a guide to future behavior. This needsfor guidance is most obvious among new comers who are trying to understand their joband the works settings. Longer service worker want positive feedback on the good thingsthey do, although they may resent corrective feedback that feels like criticism.

Supervisors and managers need to evaluate performance in order to know what action totake. Detail and specific feedback enables them to better guide employee performance

and needed training. Specific feedback also better enable members of management tomake comparative judgments about pay increase, promotions and other placementdecisions. Performance feedback is compared with standards, prompting the leader toreinforce desired outcomes and take corrective actions for poor performance.

Human resource department also use the informations gathered through performanceappraisals. Patterns of good or bad evaluations give feedback about the success ofrecruitment, selection, orientation, placement, training and other activities.

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Measures:

The mere presence of goals, however, is not sufficient. Managers must also be able tomeasure the extent to which goals have been accomplished.

Assessment:

The third requirement for defining performance is assessment. Here is where theperformance appraisal comes in. Regular assessment of progress towards goals focusesthe attention and effort of an employee or a team.

PURPOSE OF PERFORMANCE APPRAISAL

It is an exercise in observation and judgment. It is a feedback process; in general it servesa twofold purpose:

I). Improve Employee Performances:

To Improve employee performances by helping them realize and use their full potentialin carrying out their firms and missions.

II). Provide Information to Employees & Managers:

To provide information to employees and managers for us in making work relateddecisions.

More specifically appraisal serves following purposes:

Provide legal and formal organizational justification for employment decisions.

Criteria in test validation.

Provide feedback to employees.

Establish objectives for training programs.

Diagnose organizational problems.

THE APPRAISAL PROCESS

The appraisal process begins with the establishment of performance standards inaccordance with organizations strategic goals. These should have evolved out of thecompanys strategic direction and more specifically the job analysis and the jobdescription. These performance standards should also be clear and objective enough to beunderstood and measured.

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The steps are illustrated below:

Appraisal Process

In the first step, the expectations a manager has in terms of work performance by heremployees must be clear enough in her mind so that she will be able to, at some laterdate, communicate these expectations to her employees. Secondly, they should mutuallyagree to specific job performance measures, and appraise their performance against theseestablished standards.

Once performance standards are established, it is necessary to communicate theseexpectations. It should not be the part of the employees job to guess what is expected ofthem.

The third step in the appraisal process is the measurement of performance. To determinewhat actual performance is, it is necessary to acquire information about it.

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ESTABLISHED PERFORMANCE STANDARDSWITH EMPLOYEES

MUTUALLY SET MEASURABLE GOALS

MEASURE ACTUAL PERFORMANCE

COMPARE ACTUAL PERFORMANCE WITH STANDARDS

DISCUSS THE APPRAISAL WITH THE EMPLOYEE

TAKE CORRECTIVE ACTION


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Managers regarding how to measure actual performance frequently use four commonsources of information. These are:

Performance Observations,

Statistical Reports,

Oral Reports, & Written Reports.

Each has its strengths and weaknesses; however, a combination of them increases boththe number of input sources and probability of receiving reliable information.

What we measure is probably more critical to the evaluation process then how wemeasure, since the selection of the wrong criteria can result in serious, dysfunctionalconsequences. And what we measure determine to a great extent, what people in theorganizations will attempt to excel at. The criteria we measure must representperformance as it was mutually set in the first two steps of the appraisal process.

Thefourth step in the appraisal process is the comparison of actual performance with thestandards. The point of this step is to note deviations between standard performance andactual performance so that we can proceed to the fifth step in the process.

In the fifth step the discussion of the appraisal can have negative as well as positivemotivational consequences.

The final step in the appraisal is the initiation of corrective actions where necessary.Corrective actions can be of two types

1. Immediate and deals predominantly with symptoms.2. Basic and deals into causes.

Immediate corrective action is often describe as putting out fires whereas basiccorrective actions get to the source of deviation and seeks to adjust the differencepermanently. Immediate actions correct some things right now and get them back ontrack. A basic corrective action asks how and why performance deviated.

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ELEMENTS OF PERFORMANCE SYSTEM

Key elements of Performance appraisal systems

The above figure shows the elements of an effective appraisal system. The approachesmust identify performance-related standards, measure those criteria, and then feedback toemployees and to the human resource department. The end result, of course, is toimprove performance. If performance standards or measures are not job related, theevaluations can lead to inaccurate or biased result.

Without feedback, improvement in human behaviors is not likely and the departmentlacks accurate records in its human resource information system upon which to base otherpersonnels decisions, ranging from job design to compensation.

The department usually designs and administers the performance appraisal system foremployees in all departments. Centralizations is done to insure uniformity, which meansresult are more likely to be comparable among employees. Although the department maydevelop different approaches for managers, professionals, workers, and other groups,uniformity with each group is needed to insure useful results.

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HUMAN PERFORMANCE PERFORMANCE APPRAISAL EMPLOYEES FEEDBACK

PERFORMANCE MEASURES

PERFORMANCE-RELATEDSTANDARDS

EMPLOYEERECORD

HUMANRESOURCE


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Although the department usually designs the appraisal system, it seldom evaluates actual performance. Instead, according to one study, the employees immediate supervisorperforms the evaluations 90% of the times. Although other may rate performance, theimmediate supervisors are often in the best position to make the appraisal. However,multiple raters-including peers and even subordinate offer additional perspectives.

TYPICAL PERFORMANCE

The appraisal should create an accurate picture of an individuals typical jobperformance. Appraisal is not just to uncover poor performance; acceptable and goodperformance, they also need to be identified to achieve goals.

Thus, appraisal system should be job related and practical, have standards, and usedependable measures. Job related means that the system evaluates critical behaviors thatconstitute job success. These behaviors normally are identified as part of the job analysisprocess. If the evaluation is not job related, it is invalid. Without validity and reliability,

the system may discriminate in violation of equal opportunity laws. Even whendiscrimination does not occur appraisal may be inaccurate and useless if they are not jobrelated.

Evaluators and employees understand a practical system. A complicated, impracticalapproach may cause resentment, confusion, and non-use.

The method of identifying these elements would most likely be through job analysisprocedures. But whatever method is used, there must be a written record of the standards.The employee also must be advised of these standards before the evaluation occurs, notafterwards. The appraisal of each employees performance must be based upon actual

performance of the critical element.

REQUIREMENTSOF EFFECTIVE APPRAISAL SYSTEMS

Legally, scientifically and in the context of ongoing operations the key requirements ofany appraisal system are:

Strategic Congruence,

Validity,

Sensitivity,

Reliability,

Acceptability, &

Practicality.

These attributes are briefly explained one by one.

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Strategic Congruence:

Strategic congruence is the extent to which the performance management system elicitsjob performance that is congruent with the organizations strategy, goals and culture.

Validity:

Validity is the extent to which the performance measure assesses all the relevant aspectsof performance otherwise it is deficient.

Sensitivity:

Performance appraisal systems should be capable to distinguish between effective fromineffective performers.

Reliability:

There should be consistency of judgment. Different raters with different perspectives maysee the same individual very differently. To provide reliable data, each rater must haveopportunity to observe what the employee has done and the conditions under which he orshe has done.

Acceptability:

Human resource programs must have the support of those who will use them. It refers towhether the people who use the performance measure accept it.

Practicality:

Appraisal instruments must be easy for managers and employees to understand and use.

APPROACHESTO MEASURING PERFORMANCE

There are five main approaches to measure performance, which are:

1. Comparative,2. Attribute,

3. Behavioral,4. Results, &5. Quality.

These approaches consist of certain methods, which will be discussed in detail below.

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PERFORMANCE APPRAISAL METHODS

Three different approaches exist for doing appraisals. Employees can be appraisedagainst:

Absolute standards

Relative standards

Objectives

No one approach is always best each has strength and weaknesses.

Absolute Standards:

The first group of appraisal method uses absolute standards. In absolute standards wemeasure an employees performance against some established standards. In this group the

following methods are included:

The Easy Appraisal,

The Critical Incident Appraisal,

The Checklist,

The Rating Scales,

Forced Choice, &

Behaviorally Anchored Rating Scales (BARS).

THE EASY APPRAISAL

A performance appraisal method in which an appraiser writes or narrates about theemployee. It requires no complex forms or extensive training to complete, but has manyweaknesses. Because the essays are unstructured, they are likely to vary widely in term oflength and contents. This makes it difficult to compare individuals across theorganizations.

THE CRITICAL INCIDENT APPRAISAL

A performance appraisal method that focuses on the key behaviors that makes thedifference between doing the job effectively or ineffectively. The appraisal write downanecdotes describing that the employees did that was especially effective or ineffective 1.

Its drawbacks are basically:

Appraisal are required to regularly write these incidents down, and doing this on adaily or weakly basis for all subordinates is time consuming and burden-some formanagers.

Critical incidents suffer from the same comparison problem found in essays.

1 See Appendix 1

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THE CHECKLIST APPRAISALS

A performance appraisal type in which a rater checks off those attribute of an employeethat apply. In the checklist appraisal2, the evaluator uses a list of behavioral description

and check of those behaviors that apply to the employee.

RATING SCALES

A rating scale3 requires the rater to provide a subjective evaluation of an individualsperformance along a scale from low to high. Rating scale is the oldest and most widelyused form of performance appraisal.

FORCED CHOICE APPRAISAL

It is a special type of checklist, but the rater must choose between two or morestatements, all of which is favorable or unfavorable. The appraisals job is to identifywhich statement is most descriptive in each pair of statements about the employee beingrated. Often both statements in the pair are positive or negative. For example,

1. Learns quickly Work hard2. Work is reliable.. Performance is a good example for

other.3. Absent too often. Usually tardy.

BEHAVIORALLY ANCHORED RATING SCALE (BARS)

A performance appraisal technique4 that generates critical incidents and developsbehavioral dimension of performance. The evaluator appraises behavior rather than traits.

Relative Standards:

In the second general category of appraisal methods, individuals are compared againstother individuals. These methods are relative standards rather than absolute measuringdevices. The most popular of the relative methods are:

Group Order Ranking,

Individual Ranking, &

Paired Comparison.

2 See Appendix 23 See Appendix 34 See Appendix 4

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MULTI RATEROR360-DEGREE FEEDBACK

It is performance appraisal process in which supervisors, peers, employees, customers,suppliers and the like evaluate the individuals. We use this information to provide

perspective on performance from all angles (360 degrees). Here we use a tailored, multi-source feedback process, which includes three steps.

Employees and manager identify key customers for each of employees goals andcommitments.

Contract with customers regarding their expectations. The objective is to payattention to the same things that the customer thinks are important.

Meet regularly to each customer to assess progress, to plan for futureperformance, and to receive feedback.

USES OF PERFORMANCE APPRAISAL

Performance Improvement:

Performance feedback allows the employee, manager, and personnel specialists tointervene with appropriate actions to improve performance.

Compensation Adjustments:

Performance evaluation help decisions makers determine who should receive pay raises.Many firms grant part or all of their pay increases and bonuses based upon merit, whichis determined mostly through performance appraisals.

Placement Decisions:

Promotions, transfers, and demotions are usually based on past or anticipatedperformance. Often promotions are a reward for past performance.

Training & Development Needs:

Poor performance may indicate the need for retraining; likewise, good performance mayindicate untapped potential that should be developed.

Career Planning & Development:

Performance feed back guides career decisions about specific career path one shouldinvestigate.

Staffing Process Deficiencies:

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Good or bad performance implies strengths or weaknesses in the personnel departmentsstaffing procedures.

Informational Inaccuracies:

Poor performance may indicate errors in job analysis information, human resource plans,

or other parts of the personnel management information system. Reliance on inaccurateinformation may have led to inappropriate hiring, training, or counseling decisions.

Job Design Errors:

Poor performance may be a symptom of ill-conceived job design. Appraisals helpdiagnose these errors.

Equal Employment Opportunities:

Accurate performance appraisal that actually measure job related performance ensures

that internal placement decisions are not discriminatory.

External Challenges:

Sometime performance is influenced by factors outside the work environment, such asfamily, financial, health, or other personal matters. If uncovered through appraisals, thehuman resource department may be able to provide assistance.

Feedback To Human Resource:

Good or bad performance throughout the organization indicates how well the human

resource function is performing.

PERFORMANCE APPRAISAL CHALLENGES

The design of the performance appraisal system often contributes directly or indirectly tothe challenges facing human resource professionals. Important challenges include:

Legal constraints

Rater biases

Appraisal acceptance

Legal Constraints:

Performance appraisal must be free from discrimination. Whether form of evaluation thedepartment uses, it should be both valid and reliable.

Rater Biases:

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Biases are the inaccurate distortion of a measurement. Although training in the conduct of performance appraisal can help reduce bias, raters who failed to remain emotionallydetached while they evaluate employee performance usually cause it. The most commonrater biases include:

The Halo Effect The Error of Central Tendency

The Leniency & Strictness Biases

Cross-cultural Biases

Personal Prejudice

The Regency Effect

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INTRODUCTION TO THE BANKS:

CITIBANK:

Vision:

To be the organization of choice dedicated to our customer & employees. Providingexceptional service quality and delivering consistently superior financial Performance.

History:

The largest of the citys banks in 1811 was the Bank of the United States, established byCongress the request of Alexander Hamilton to finance and promote the development ofcommerce and industry. The demise of the Bank of United States was a major blow to the

local merchants, prompting proposals for, new banks, including that of City Bank. The firstpetition to organize a sixth New York City bank was defeated in the State Legislature inMarch 1811, due to internal rivalry in the Republican Party (not to be confused with todays political party of the same name). Colonel Samuel Osgood, a senior statesman of theRepublican Party, stepped forward to unite the rival factions behind the City Bank petition.He wrote: if a republican bank be incorporated, surely it ought to be done on principles thatwill tend to harmonize the republicans of the City of New York.

Colonel Osgood was well established in banking serving as a director of the Bank of NorthAmerica in 1781 and as cashier of the Massachusetts Bank in 1784. In 1799, he helped AaronBurr establish the Bank of the Manhattan Company, where he remained a director until 1803.

As a result of Colonel Osgoods intervention, each faction within the Republican Partynamed six members to the new banks board of directors, helping the second petition to sailthrough the State Legislature. On June 16, 1812, with $2 million of capital, City Bank ofNew York (now Citibank) opened for business at 52 Wall Street. Colonel Samuel Osgoodwas the banks first president.

Citibank Operations in 57 Countries:

For more than 20 million customers in 42 countries, more than 1,100 branches and avariety of electronic access systems are the gateway to state-of-the-art banking productsand the best ideas from around the world. The only truly global consumer bank, Citibank

is creating the global products and global platforms that meet the expanding bankingneeds of a middle class that is rapidly growing throughout the world.

Regions:

Citibank operates all over the word by classifying its business in the following fiveregions:

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Asia Pacific

Central & Eastern Europe, Middle East, Africa & South Asia

Latin America

North America

Western Europe

Citibank Operations In Pakistan:

Citibank's presence in Pakistan dates back to 1962. Citibank is one of Pakistan's mostinnovative commercial and investment bank, having won more international citations fordeals done in Pakistan and having more landmark transactions to its credit than any otherfinancial institution.

Citibank is the market leader in innovation and product development. A full range ofcommercial banking activities are carried out by Citibank including cash management,custodial services, advisory services, foreign exchange transactions, trade financing, and

working capital finance.

Citibank also has a full-fledged consumer bank functioning at each of the branches.Today Citibank's portfolio includes over 200 Corporate, Public Sector and FinancialInstitutes.

Organizational Structure:

Organization structure is the formal system of rules and task and authority relationshipsthat control how people corporate and use resources to achieve the organizations goal.

Citibank as an international firm tends to maintain centralized control over their corecompetencies and to decentralize other decisions to foreign subsidiaries. Citibank hascentralized research and development and marketing in the home country with littlevariation in marketing strategies in major countries and has decentralized operatingdecisions to the foreign subsidiaries5.

Citibanks Culture:

The culture of the Citibank contains the followings:

Physical surroundings

ValuesFunctions, Events and CeremoniesThe Dress CodeGoals

Stories

Slogans

5 See Appendix 5

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PHYSICAL SURROUNDINGS

Citibank has a well-decorated, organized and impressive interior. The security system isquite infallible and reliable.

VALUES

It expects all employees of the company to act in accordance with the highest standardsof personal and professional integrity in all aspects of their employment andto comply with all the applicable laws, regulations, and company policies.

FUNCTIONS, EVENTSAND CEREMONIES

Get-togethers are arranged for all of the employees of corporate and consumerdepartment on a yearly basis, so that they can interact and socialize amongone another. Special occasions like Pakistan Day, Defense Day and New

Year get together and Eid-Milan Parties are arranged.

THE DRESS CODE

The dress code is formal, consisting of suit and tie for men and formal shalwar kameezfor women. On Saturdays, you can dress informally. However, on weekdays,formal dress code is compulsory.

GOALS

Their main goal is to generate profit, give customer satisfaction and deliver sustained

superior value to the clients, and be the most successful financial services firmin the world.

STORIES

Like each organization, Citibank has learned from experience and keeps relating the storyas a source of motivation to lower-level employees as well as managers.

SLOGANS

Different slogans that Citibank has adopted throughout the years are:

The Citi that never sleeps

Where money lives

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Location:

While expanding internationally there came a question at which location to operate?Citibank has selected location where it can generate maximum profit by providing thebest quality services.

In Pakistan Citibank have only seven branches, two in Karachi and one each in Lahore,Rawalpindi, Islamabad, Faisalabad, which are considered as the main cities of Pakistanand also the major business sectors in Pakistan.

Citibank Approach:

Citibank is handling the situations very effectively by appointing senior managers fromthe same region so that vast cultural differences can be narrowed down secondly the mostcommon factor of spouse adjustment can be managed. Citibank keep on doing familyactivities so that the interaction between families increases. Citibank also followed the

under mentioned criteria for the selection of its expatriate staff. HRM managers tend toequate domestic performance with overseas performance potential. Domesticperformance and overseas performance potential is not the same thing. An executive whoperforms well in a domestic setting may not be able to adapt to managing in a differentcultural setting.

Training & Management Development:

Citibank is running a complete department of HRM, which considers the backbone oforganization.

Citibank has a great emphasis on training of its employees and continuously improvingtheir skills. Selection is just the first step in matching a manager with a job. The next stepis training the manager to do the specific job. An intensive training program will be usedto give expatriate managers the skills required for success in a foreign posting. Inmanagement development they develop the manager's skills over his or her career withthe firm. Thus, as part of a management development program, a manager will be sent onseveral foreign postings over a number of years to build her cross-cultural sensitivity andexperience. At the same time, along with other managers in the firm, she might attendmanagement education programs at regular intervals. Management development is seenas a tool to help the Citibank to achieve its strategic goals.

Management development programs are designed to increase the overall skill levels ofmanagers through a mix of ongoing management education and rotations of managersthrough a number of jobs within the firm to give them varied experiences. They areattempts to improve the overall productivity and quality of the firm's managementresources.

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Compensation:

Citibank is not paying a healthy amount to its lower grade officers however; middle andtop management is compensated at very good scales. The components of the typicalcompensation package are:

A base salary,

A Foreign Service premium,

Allowances of various types,

Tax differentials, and

Benefits and medical cover.

Staffing Policy:

Staffing policy is concerned with the activities include determining the firm's humanresource strategy, staffing, performance evaluation, management development,

compensation, and labor relations. At one level, this involves selecting individuals whohave the skills required to do particular jobs. At another level, staffing policy can be atool for developing and promoting corporate culture. By corporate culture, we mean theorganization's norms and value systems. Citibank pursuing transnational strategies havehigh needs for a strong unifying culture,

HRM function to pay significant attention to selecting individuals whom not only has theskills required to perform particular jobs but who also "fit" the prevailing culture of thefirm.

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UNION BANK:

Mission:

To be the premiere bank, responsive to the needs of our target market customers,recognized for consistently superior service quality and innovative products, therebydelivering superior value to our stakeholders

Vision:

Union Bank's vision is to provide its clients with complete banking solutions.

History:

Established in 1991 and backed by a major Middle Eastern Group, Union Bank today isthe preferred choice of thousands of satisfied customers throughout Pakistan. In Pakistanthe Saigols till 2000 owned it.

In the year 2000, Union Bank acquired Bank of America's operations in Pakistan.Keeping on the same strategic run, in July 2001, Union Bank signed an IndependentOperator agreement for American Express Cards in Pakistan. As a result of thisarrangement, Union Bank now issues, operates and markets American Express cards inPakistan. The Bank is also in the business of acquiring merchants accepting VISA,MasterCard, American Express and JCB cards. In 2002, Emirates Bank International

(Pakistan Operations) has been acquired by Union Bank Limited. With this, Union Bankhas become one of the largest private banks in the country.

With major investments in international brand acquisitions, branch network andinformation technology including a state-of-the-art customer contact center, Union Bankis well on its way to offer its customers innovative financial products. This would resultin an unmatched level of service quality offered by the Bank in the years to come.

Operations:

With 42 branches in 17 cities and a correspondent banking network of over 300 banks in

85 countries, Union Bank is rapidly gaining ground in the global financial market.

Management at Union Bank:

The management at Union Bank comprises of seasoned professionals in the fields of banking and finance thereby encouraging a culture of innovation, and total customersatisfaction.

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New Corporate Visual Identity:

The new corporate identity, with bright colors yet simple outlook, is designed to

reflect a premiere, modern and technology oriented bank. The bright colors not only

ensure increased visibility but also create a fresh, energized and vibrant outlook.

The simple font portrays a unique appeal of elegance and modernity.

Culture:

The culture of the Union bank contains the followings:

Physical surroundingsValuesThe Dress Code

PHYSICAL SURROUNDINGS

Union bank is situated at a very popular place. The branch is decorated very well andsecurity system is also good.

VALUES

The core values of Union Bank are:

Integrity

Meritocracy

Innovation

Team-work

Integrity: Uncompromising honesty to oneself, the customer and the company withmutual relationships based on trust and the rejection of intrigues.

Meritocracy: Compensation and career progression based on performance against setgoals and objectives without bias to personal relationships, gender, religion or ethnicity.

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Innovation: Create and implement simple yet creative, new and dynamic future orientedlearning's leading to out of the box solutions to the needs of the customer and improvedproductivity.

Teamwork:The ability and willingness to share equally the responsibility of failure and

the glory of achievement.

DRESS CODE:

The dress code at Union Bank is formal, i.e. neck ties for the male and shalwar kameezfor the females. Each employee, one by one, is allowed to come casual on Saturday.

Structure:

The structure6 of Union Bank is centralized with the Branch Manager at the top. Theyhave 4-5 regional heads. Their HRD7 is located in Karachi.

Recruitment & Selection:

Union Bank hires employees according to requirement. The branch manager informs theregional head if new recruits are needed. The regional head informs the HRD in Karachiwho then send the appointment letter. Employees become permanent after duration of 1year.

Training:

Before the change in management in 2000, Union Bank had its own training academy in

Lahore. Their employees had to go through various tests, interviews, etc. to get selected.After that they were given management training for 6 months in the academy and 6months on the job.

Now, they do not have a formal training place, but they train their employees on the job.

Compensation:

The starting pay for a fresh graduate is Rs. 12,000. Pay scale also depends upon thequalifications. Instead of the salary, the employees are given extra bonuses with respectto their performance. They are allowed one-month holiday, with pay, each year. They are

also allowed personal loans etc. Certain amount of medical is also free for theiremployees.

ANALYSIS OF PERFORMANCE APPRAISAL SYSTEMS OF CITIBANK & UNION BANK:

6 See Appendix 67 Human Resource Department

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Performance is evaluated at all levels on yearly basis, targets are assigned to every bodyand mostly appraisals are conducted on their basis. Expatriate managers are evaluated attwo levels first in host country and secondly in corporate HQ.

Employees are motivated by the fact that it is a private sector and there is intensecompetition. If a person is not doing well, he wont remain on his seat. Either he will bereplaced or transferred.

An Annual Evaluation Process is held in which each employees performance iscompared with his/her targets. The supervisor ranks each employee on a scale of 1 to 5,where 1 is Excellent and 5 is Poor. Only 10% are graded 1,which is why there is intensecompetition for scale 1.

On an annual basis, bonuses are given to employees whose performance exceeds theirtargets. The main motivational factors are bonuses, pay-raises, promotions and Awards.

Citibank uses appraisal forms8 to evaluate their employees. The evaluation is done once ayear. It is done from April to April. If there are 100 points then rating will be inthis way that above 95 the person lies in the excellent category then below 95 theperson lies in the very good scale then below 70 the person lies in the thirdcategory and the person below 60 the person lies in the fourth category and below50 the person lies in poor category

Note: On the fifth category the organization issue two memos to the person and ifcontinuously performance of the person is poor then after two memos the person isterminated from the organization.

As the organization has MIS system so productivity is very important. Productivity isdivided in to two categories. One is the system utilization and the other is the target.Every department in the organization has different targets. These depend upon the natureof the job. As the sales department and the collection department has the different target.For example, the sales department has the customer-oriented targets and the collection

department has the targets of the amount recovery and the legal cases etc. Systemutilization is very important.

Reward System:

Rewards are given on the basis of employee performance and according to the jobdescriptions. Rewards may include bonuses, increments, pay rises, etc.

8 See Appendix 7

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Performance Appraisal is a future oriented activity that provides staff members withuseful feedback and coaches them to higher level of performance. It is the process in anorganization whereby each employee is evaluated to determine how he or she isperforming. Employees seek feedback on their performance as a guide to future.

Now employers are more interested towards the knowledge and skill of employees. Inthis fast moving era, it is the survival of the fittest. Meaning that only those can survivewho keep on developing their skills side by side otherwise once one is left behind it isreally difficult to catch up again. Therefore, performance appraisal is of vital importanceas it keeps a check on employees performance. Due to this the employee can see wherehe stands and ranks and can then improve himself/herself.

Although evaluating is a difficult, time consuming task it has several advantages both forthe employee and the employer.

After studying the performance appraisal systems of both the banks, we came to certain

conclusions. Although both the banks are very prosperous, there is always a need toimprove. There were some functions of one bank that were better than the other. Thereare some aspects of the system, which are contradictory, especially of Citibank. Theyclaim on doing something, which was in contrast with our findings. As our focus wasmore on Citibank, therefore, we suggest a few recommendations for them:

Citibank claims it does 360-degree feedback, but the employees claim that theyare not consulted during feedback. Therefore, the evaluators should bring fairnessand validity in their process. As this is not only important for the BanksPrestigebut it is also very vital for an employee career.

They should make the appraisal form more comprehensive, like the Union Bank.

This would result in minimum error. There is contradiction between the top level and the lower levels, which shows

lack of communication. They should keep a more decentralized structure to helpovercome this problem.

Uninion & Citi Bank

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