Performance Appraisal System's Impact on Employee Performance at MNPI

This report presents a comprehensive analysis of the impact of performance appraisal systems on employee performance, drawing on survey data and statistical techniques. Chapter 4 focuses on data analysis, including reliability and validity tests (Cronbach’s Alpha, KMO, Bartlett’s test) and frequency representations using SPSS. Statistical methods such as Pearson's correlation and regression analysis are employed to examine the relationship between performance appraisal and employee performance. The findings reveal demographic insights, such as gender and age distribution, and educational qualifications of respondents. The report further explores employee perceptions of performance reviews, including frequency, purpose, and satisfaction levels. Key findings include the positive correlation between performance appraisal and employee motivation, as well as the impact of various factors within the appraisal system on overall employee performance. The report also incorporates interview data from HR professionals, offering insights into organizational practices and objectives related to performance appraisals, ultimately providing recommendations for future research and improvements in performance management systems.

Chapter 4: Data analysis
4.1 Introduction
This chapter critically evaluates the collected data from the survey to develop relevant
findings and analysis. Data reliability and validity has been measured using statistical
techniques such as Cronbach’s Alpha test, Kaiser Meyer Olkin test of sampling adequacy and
Bartlett test of sphericity. The response frequencies have been represented in graphs which
are derived from the SPSS. Statistical analyses such as Pearson’s correlation method and
Regression analysis has been used to perform a trend analysis and measure the relationship
between employee appraisal system and employee performance.
4.2 Quantitative Findings
4.2.1 Gender
Fig 1: Gender
Source: (As created by author)
This question examines the gender of the participants in the given research and the
findings show majority of the respondents are female when compared to the number of male
respondents. It is also shocking to see that the number of female respondent is almost twice
that of the male respondents. It would be interesting to see the difference in perspective
between the two gender regarding performance appraisal systems.

4.2.2 Age
Fig 2: Age
Source: (As created by author)
This question examines the age of the respondents in the research and the results show
that 41.57% of the respondents belong to the age group of 25-34, 26.51% respondents belong
to the age group of 35-44, 22.89% are less than 25 years of age and remaining respondents
are above the age group of 45 years. This clearly shows that majority of the respondents are
below the age group of 34 years. There are representation from different age groups so it
would be interesting to check how their feel about performance appraisal system.

4.2.2 Education Qualification
Fig 3: Educational Qualification
Source: (As created by author)
This question evaluates the educational qualification of the respondents in this
research. The results show that 55.42% of the respondents have completed their diploma,
24.70% have completed their degree, 7.83% have completed their advance diploma, 7.23%
have completed their master’s degree and remaining have completed their post graduate
diploma. Therefore, it is expected that people from different educational backgrounds will
have different perspective on the research topic.

4.2.2 Education Qualification
Fig 4: Length of employment
Source: (As created by author)
The purpose of the question is to examine the tenure of the respondents in this
research. In this study, 37.35% have been working for less than 4 years, 35.54% have been
working for at least 5 years and maximum of 9 years, 21.69% have been working between
10-19 years and 5.42% have been working for more than 20 years.

4.2.3 Impact of performance appraisal system on performance management
Fig 5: performance review
Source: (As created by author)
This above question identifies whether the employees have gone through performance
review or not. The findings show that majority of the employees have gone through a
performance review which amounts to 92.77% of the respondents and remaining have not
been involved in any kind of performance review.
4.2.3 When did you have the performance review last time?

Fig 6: Last performance review
Source: (As created by author)
The question highlights the last performance review time of the participants that have
gone through the process. The majority of the respondents have gone through a performance
review within the last 12 months and the remaining respondents are almost negligible which
shows a clear majority. This is an ideal situation as majority of the participants have gone
through an appraisal which is expected to provide better results in the research.
4.2.4 How often is an appraisal carried out in your department?
Fig 6: Appraisal period
Source: (As created by author)
The purpose of the question is to highlight the number of times appraisal is being
carried out in the respondent’s workplace. The results show that 75.90% of the respondents
suggest that appraisal is yearly in their respective organisation, 20.48% stated that appraisal
happens half yearly in their organisation and remaining are exceptions. This shows that
majority of the organisations follow the structural pattern of having appraisal once every
year.

4.2.5 In your opinion, what does your strive to achieve through performance review?

Fig 7: Employee Motivtion
Source: (As created by author)
This question evaluates the purpose of conducting an appraisal and the respondents
have chosen options that they consider it to be relevant. It can be seen that 81.33% of the
respondents suggested that performance review is the main objective, 74.10% suggested that
training and development needs determination is another important factor, 70.48% suggested
that setting future target is another important factor, 62.65% suggested that promotion and
levelling up is another critical goal for performance evaluation and 50.60 % suggested that
taking disciplinary options another purpose of conducting a performance appraisal. This

shows that there are multiple reasons that appraisal is performed and managers use it for all
around development of the employees.
4.2.6 At the beginning of the PR cycle, were you consulted on:

Fig 8: Consultation
Source: (As created by author)
The question tries to examine whether the employees were consulted on certain
factors before proceeding with the appraisal or not. The results show that majority of the
respondents were consulted on the desired behaviour or outcome, methods of measuring
performance and date and time of appraisal. However, the majority of the respondents were
not consulted on the factors which are parameters for evaluating the respondents. This is a

critical issue for employees as if they are not aware of their job roles and responsibilities,
they will not be able to fulfil their duties effectively.
4.2.7 Do you agree that it is necessary to conduct a performance review?
Fig 9: Necessity of performance review
Source: (As created by author)
This question examines whether there is a need for performance review or not. The
findings of the study shows that 91.57% of the respondents suggested that performance
review is essential component of employee growth.