Final Project

A STUDY ON

PERFORMANCE MANAGEMENT SYSTEM

WITH REFERENCE TO

HINDUSTAN AERONAUTICS LIMITED

BALANAGAR, HYDERABAD

Submitted for the partial fulfillment of

MASTER IN BUSINESS ADMINSTRATION

Submitted by

D. NARASIMHA RAO

Roll No: 08032E0023

Under the Esteemed Guidance of

Mr. T. PRABU KUMAR

Associate Professor, SMS, JNTUH

SCHOOL OF MANAGEMENT STUDIES

JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERISTY

HYDERABAD

KUKATPALLY, HYDERABAD-500 085.

1

DECLARATION

I, D. NARASIMHA RAO, pursuing M.B.A (PTPG) VI Semester at School of

Management Studies, Jawaharlal Nehru Technological University Hyderabad,

Kukatpally, Hyderabad hereby declare that the project report titled “A STUDY ON

PERFORMANCE MANAGEMENT SYSTEM WITH REFERENCE TO

HINDUSTAN AERONAUTICS LIMITED” submitted by me in partial fulfillment

for award of Master of Business Administration is an original work.

Place: Hyderabad D. NARASIMHA RAO

Date: …………….. Roll No: 08032E0023

JNTUH

School of Management Studies

Kukatpally, Hyderabad

2

SCHOOL OF MANAGEMENT STUDIES

JAWAHARLAL NEHRU TECHNOLOGICAL UNIVERSITY HYDERABAD

CERTIFICATE

This is to certify that D. NARASIMHA RAO, Roll No. 08032E0023 is a student of

SMS, JNTUH and the report titled “A STUDY ON PERFORMANCE

MANAGEMENT SYSTEM WITH REFERENCE TO HINDUSTAN

AERONAUTICS LIMITED” done by him is an original work and is not submitted

to any other university other than JNTUH.


Date:…………….. Roll No: 08032E0023

JNTUH



3

CERTIFICATE

This is to certify that this is the bonafide project work entitled “A STUDY ON

PERFORMANCE MANAGEMENT SYSTEM WITH REFERENCE TO

HINDUSTAN AERONAUTICS LIMITED” carried out by Mr. D. NARASIMHA

RAO, Roll No.08032E0023 for the academic year 2008-2011 as a partial fulfillment

of M.B.A. degree submitted to School of Management Studies, Jawaharlal Nehru

Technological university,

Place: Hyderabad DR. A. R. ARYASRI

Date: …………… Director, SMS JNTUH

4

CERTIFICATE

This is to certify that Mr. D. NARASIMHA RAO, Roll No.08032E0023 is a part-

time student of S M S, JNTUH and the report submitted by him entitled “A STUDY

ON PERFORMANCE MANAGEMENT SYSTEM AT HINDUSTAN

AERONAUTICS LTD.” is his original work and is not submitted to any other

university other than J N T U. This project has been carried out under my guidance.

Place: Hyderabad Mr. T. PRABU KUMAR

Date: …………… Associate Professor- JNTUH



5

ACKNOWLEDGEMENT

I owe a great many thanks to a great many people who helped and supported me

during the Project.

My deepest thanks to Mr. T. PRABU KUMAR, the Guide of the Project for

guiding and correcting various documents of mine with attention and care. She has

taken her valuable time to go through the project and made necessary corrections as

and when needed.

I express my sincere thanks to Mr. N.N. SANJAY Sr. Manager (HR) HAL for their

excellent guidance in this Project.

I express my thanks to Dr. ARYASRI the Director of JNTUH- School of

Management

Studies, for extending their support. My deep sense of gratitude to my Friends for

their

support and guidance. Thanks and appreciation to the helpful people who involved

directly and indirectly and provided their support. And I would also thank my

Institution and my faculty members without whom this project would have been a

distant reality. I also extend my heartfelt thanks to my family and well wishers.


Roll No: 08032E0023

JNTUH



6

INDEX

CHAPTER-I Page No

Introduction:

Need for the study

Objectives of the study

Scope of the study 1 to 18

Research Methodology

Limitations of the study

CHAPTER-II

Review of literature 19 to 40

CHAPTER-III

Profile of Industry 41 to 46

CHAPTER-IV

Profile of the Organization 47 to 71

CHAPTER-V

Data analysis and interpretation 72 to 111

CHAPTER-VI

Findings

Suggestions & 112 to 116

Conclusion

Bibliography 117 to 125

Appendix - I

7

CHAPTER – I

INTRODUCTION

8

1.1 INTRODUCTION

Human Resource Management

Human resource (or personnel) management is defined as getting things done

through people. It's an essential part of every manager's responsibilities, but many

organizations find it advantageous to establish a specialist division to provide an

expert service dedicated to ensuring that the human resource function is performed

efficiently.

"People are our most valuable asset" is a cliché which no member of any

senior management team would disagree with. Yet, the reality for many organizations

is that their people remain

under valued

under trained

under utilized

poorly motivated, and consequently

perform well below their true capability

The rate of change facing organizations has never been greater and

organizations must absorb and manage change at a much faster rate than in the past.

In order to implement a successful business strategy to face this challenge,

organizations, large or small, must ensure that they have the right people capable of

delivering the strategy.

The market place for talented, skilled people is competitive and expensive.

Taking on new staff can be disruptive to existing employees. Also, it takes time to

develop 'cultural awareness', product/ process/ organization knowledge and

experience for new staff members.

As organizations vary in size, aims, functions, complexity, construction, the

physical nature of their product, and appeal as employers, so do the contributions of

human resource management. But, in most the ultimate aim of the function is to:

"ensure that at all times the business is correctly staffed by the right number of people

9

with the skills relevant to the business needs", that is, neither overstaffed nor

understaffed in total or in respect of any one discipline or work grade.

Performance Management System

The PM approach is used most often in the workplace but applies wherever

people interact—schools, churches, community meetings, sports teams, health setting,

governmental agencies, and even political settings. PM principles are needed

wherever in the world people interact with their environments to produce desired

effects. Cultures are different but the laws of behavior are the same worldwide.

Armstrong and baron (1998) defined it as “A strategic and integrated approach to

increasing the effectiveness of organizations by improving the performance of the

people who work in them and by developing the capabilities of teams and individual

contributors”

It is possible to get all employees to reconcile personal goals with

organizational goals. One can turn around any marginal business and increase

productivity and profitability for any organization, with the transparent and hidden

forces embedded in this process. It can be applied by organizations or a single

department or section inside an organization; as well as an individual person.

The process is a natural, self-inspired performance process and is

appropriately named the self-propelled performance process (SPPP).

It is claimed that the self-propelled performance management system is:

1. The fastest known method for career promotion;

2. The quickest way for career advancement;

3. The surest way for career progress;

4. The best ingredient in career path planning;

5. The only true and lasting virtue for career success;

6. The most neglected part in teachings about management and leadership

principles;

7. The most complete and sophisticated application of performance management;

10

8. The best integration of human behaviour research findings, with the latest

management, leadership and organizational development principles;

9. The best automated method for organizational change, development, growth,

performance and profit;

10. The surest and fastest way for increased motivation, productivity, growth,

performance and profitability for both the individual and the organization;

11. The best career builder and career booster for any career; and

12. Inspirational, as it gets people moving, makes them self-starters in utilizing

own talents and initiative, automatically like magic.

Performance Appraisal System in HAL

The Performance Appraisal System of Officers in Grade – I to X has been

categorized into 5 levels. They are:

Level Grades

Level – I I & II

Level – II III & IV

Level – III V & VI

Level – IV VII & VIII

Level – V IX & X

Salient features of the Performance Appraisal system are:

Two tier system (Initiating Authority & Reviewing Authority)

Quarterly task setting and evaluation on a quarterly basis.

Traits based on the responsibilities associated with each level.

Self-Appraisal by officers at all levels.

Qualitative Assessment, Management Review Categorization & identification

of training & developmental needs both by IA & RA

The Performance Appraisal comprises of Nine major parts:

PART CONTENTS TO BE FILLED

11

BY

COVER

PAGEBio – data of the Appraisee Appraisee

PART – A Quarterly Task setting and Assessment Appraisee & IA

PART – BSelf Appraisal

Comments on Self Appraisal & Integrity

Appraisee

IA & RA

PART – C Assessment of Traits IA & RA

PART – DQualitative Assessment of the Appraisee

(Pen Picture)IA & RA

PART - EGeneral Assessment & Management Review

CategorizationIA & RA

PART – F Training And Developmental Needs IA & RA

PART – GEvaluation by Performance Review Board

Remarks of Higher Authorities

PRB

GM/MD/FD/CH

PART – H Illustration list of Areas for Training -

PART – I Check List HRD Cell

Quarters for the purpose of PARs:

Quarter Period

I 1st April to 30th June

II 1st July to 30th September

III 1st October to 31st December

IV 1st January to 31st March

SCALE OF GRADATION:

TOTAL

MARKS100-90 89-80 79-50 BELOW 50

Performance

RatingExceptional Above Average Average Below Average

ASSESSMENT METHOD

12

Selection of officers would be based on Marks scored in the PARs for the previous 3

years and Interview. Marks would be awarded in the Assessment as follows:

Criteria Maximum Marks

Written Test 25

Average Performance Index (API) 50

Interview 25

Total 100

Minimum Qualifying Marks in the Interview

Normal Promotions 60% (15 out of 25)

IMS 75% (18.75 out of 25)

Overall minimum qualifying marks (API + WT + Interview)

Normal Promotions 60 out of 100

IMS 85 out of 100

GENERAL: Officers who are left with less than 1 year of service before their

superannuation as on 1st July of the year of selection will not be considered generally

eligible for promotions.

PROCESSING & EFFECTING PROMOTIONS

Promotion to Grade Effected at

II & III Divisional Level

IV, V & VI Complex Level

VII & VIII Corporate Level

While the promotions under IMS up to and including Gr-VI will processed at

the Divisional/Complex Level, approval of Corporate Office will be obtained before

effecting the promotions.

1.3 Objectives of the Study:

The major objectives of this study are as follows:

13

To study and analyze the Performance Management System

followed by “Hindustan Aeronautics Limited”.

To study various Performance Management Practices.

To study the Satisfaction level of the Officers working in HAL

towards the Performance Management System followed in HAL

To study the various factors influencing Performance Appraisal

Policy in “Hindustan Aeronautics Limited.”

To study the Promotion Policy and its effect on the satisfaction

level and performance of Officers in “Hindustan Aeronautics

Limited.”

1.4 Methodology of the Study:

Selection of the Study

The topic of the study was decided in consultation with guide Smt.

Bharati Arsid, Officer HR since the Performance Management is very much important

in any organization. The main objective of the project is to find out the officer’s

satisfaction towards Performance Management System followed in HAL. Hence the

project is titled as “Performance Management System of Officers.”

Source of Data:

The task of data collection begins after a research problem has been defined.

To start any research collection of data is required so that we get a clear picture about

research, which will help to move further in the study.

Method of Data Collection:

There are two types of data namely Primary and Secondary Data.

The Primary Data are those, which are collected afresh and for the first time

and thus happen to be original in character.

14

The secondary data are those which have already been collected by someone

else and which have already been passed through the statistical process.

1.5 SCOPE OF STUDY

The study is confined to Hyderabad Division for 2 months;

It is confined to Officers from Grade – I to Grade – VI of Hindustan

Aeronautics Limited, Avionics Division.

It is confined to the Officers, who appeared in the promotion written test

which was conducted in the month of May, 2011.

1.6 Limitation of the Study:

HAL is a big organization and spread over the country so I limited my study to

the Avionics Division located at Balanagar, Hyderabad.

Time was main constraint. Two months period will not be sufficient to

conduct the study.

Some of the Executives hesitated to participate as they were too busy with

other important tasks.

Questionnaire forms were not submitted by some of the Officers in the

requested time period, this led to the slow analysis of the feedback.

Only 101 respondents are covered in the study.

1.7 Presentation of the study:

Present study is divided into 6 chapters.

15

The First Chapter consists of Introduction of the study.

The second chapter consists of Industry Profile and Company Profile.

The Third Chapter Consists of Review of literature.

The Fourth Chapter consists of the practical study - Data Analysis

and Interpretation of Recruitment and Selection activities.

The Fifth Chapter consists of the relevant findings over the observations and

suggestions of the data and Conclusion.

The Sixth Chapter consists of Bibliography and Annexure.

16

CHAPTER – II

REVIEW OF LITERATURE

17

Performance management system:

Definition:

Performance management is the process of creating a work environment or

setting in which people are enabled to perform to the best of their abilities.

Performance management is a whole work system that begins when a job is defined as

needed. It ends when an employee leaves your organization.

A performance management system includes the following actions.

Develop clear job descriptions.

Select appropriate people with an appropriate selection process.

Negotiate requirements and accomplishment-based performance standards,

outcomes, and measures.

Provide effective orientation, education, and training.

Provide on-going coaching and feedback.

Conduct quarterly performance development discussions.

Design effective compensation and recognition systems that reward people for

their contributions.

Provide promotional/career development opportunities for staff.

Assist with exit interviews to understand WHY valued employees leave the

organization.

TERMINOLOGY

Behavior - a manner of conducting oneself

Checklist appraisals – a performance appraisal formant that requires the rater

to check items most representative of the employee’s characteristics and work

contributions

Comparative appraisal methods – measurement of individuals against each

other, resulting in a list of individuals ranked in order of performance

18

Competency-based appraisal – appraisal based on knowledge, skills, and

abilities.

Critical incidents – reports made by knowledgeable observers of action taken

by individuals who were especially effective or ineffective in accomplishing

their jobs

Essay appraisal – a performance appraisal format that rates the employee’s

job performance in a narrative discussion

Graphic rating scale – a format used to rate performance on a continuum of

scale points

Management by objectives – a performance appraisal system that sets

organizational goals and measures actual accomplishments against them

Performance appraisal – Formal, written assessment of employee work

contributions and the communication that takes place with employees before,

during, and after the assessment. Process by which an organization measures

and evaluates an individual’s behavior and accomplishments.

Performance standards – statement of what is considered acceptable and

attainable on a particular job

Traits – personal characteristics or attributes of an individual that tend to be

consistent

PURPOSE OF PERFORMANCE APPRAISALS

Major use is for pay decisions

Identify candidates for promotion and reassignment

Determine needs for training and development

Give feedback for improvement

Administer rewards and discipline

Motivation tool for improved productivity

Goal setting for future accomplishments and measure attainment

PERFORMANCE APPRAISAL CRITERIA

Traits – Traits such as leadership, judgment, initiative and dependability are

positively correlated with job performance but may be difficult to measure

19

Behaviors – This criteria focuses on tasks to be performed but performance of

expected criteria do not necessarily lead to success on the job if other criteria

is not met

Outcomes – Focuses on measurable results

IMPLEMENTING PERFORMANCE APPRAISAL SYSTEMS

Establishing policies and procedures for consistency in rating

Training raters to

o Understand the key accountabilities of their jobs

o Establish reasonable goals and measures of performance

o Coach subordinates

o Adjust expectations

o Overcome common rating errors

o Keep consistent performance records

o Accurately and consistently appraise performance

o Listen effectively

o Give timely feedback

o Focus on observable behaviors

o Gain employees’ agreement in meeting acceptable standards of

performance

WHY PERFORMANCE APPRAISALS FAIL

Lack of objectivity

Lack of job knowledge

Evaluating non-job related criteria

Unfocused criticism – comments too general

Lack of opportunity for feedback

Insufficient time spent on evaluation

Inconsistent standards

20

Content of appraisal

PERFORMANCEAPPRAISAL

TRADITIONAL METHODS

MODERNMETHODS

Essay Appraisal MethodStraight Ranking MethodPaired ComparisonCritical Incidents MethodsField ReviewChecklist MethodGraphic Ratings ScaleForced Distribution

Management By Objectives (MBO)360 Degree AppraisalAssessment CentresBehaviorally Anchored Rating ScaleHuman Resource Accounting

21

Quantity of work

Volume of work under normal working conditions

Quality of work.

Neatness, thoroughness and accuracy of work Knowledge of job.

Dependability.

Conscientious, thorough, reliable, accurate, with respect to attendance, relief,

lunch breaks, etc.

Judgment

Attitude.

Exhibits enthusiasm and cooperativeness on the job

Cooperation.

Willingness and ability to work with others to produce desired goals.

Initiative.

Studying validity is studying the problem of whether or not a test measures what it

purports to measure. Assessment centres have high predictive, face and content

validity because of the following reasons –

a. Designing of ACs is based on job analysis

b. Observers are extensively trained

c. Candidates are graded by using ratings of competencies

The construct and criterion validity of assessment centres depends on effective job

analysis. If job analysis is properly done then these two validities are also found to be

high.

4. HUMAN RESOURCE ACCOUNTING METHOD

22

The American Accounting Association’s Committee on Human Resource

Accounting (1973) has defined Human Resource Accounting as “the process of

identifying and measuring data about human resources and communicating this

information to interesting this information to interested parties”. HRA, thus, not only

involves measurement of all the costs/investments associated with the recruitment,

placement, training and development of employees, but also the quantification of the

economic value of the people in an organization.

Human resources are valuable assets for every organization. Human resource

accounting method tries to find the relative worth of these assets in the terms of

money. In this method the Performance appraisal of the employees is judged in terms

of cost and contribution of the employees. The cost of employees include all the

expenses incurred on them like their compensation, recruitment and selection costs,

induction and training costs etc whereas their contribution includes the total value

added (in monetary terms). The difference between the cost and the contribution will

be the performance of the employees. Ideally, the contribution of the employees

should be greater than the cost incurred on them.

HRA serves the following purposes in an organization:

It furnishes cost/value information for making management decisions about

acquiring, allocating, developing, and maintaining human resources in order to

attain cost-effectiveness;

It allows management personnel to monitor effectively the use of human

resources;

It provides a sound and effective basis of human asset control, that is, whether

the asset is appreciated, depleted or conserved;

It helps in the development of management principles by classifying the

financial consequences of various practices.

23

http://appraisals.naukrihub.com/

CHAPTER – III

INDUSTRY PROFILE

INDUSTRY PROFILE

Aeronautical industry

Following the rapid development of powered flight at the beginning of the

20th century aircraft manufacture, in common with many other strategic industries,

was given a great stimulus during the First World War. The military potential of

fixed-wing aircraft for observation and combat was proved for the first time on any

24

http://www.encyclopedia.com/doc/1O110-FirstWorldWar.html

scale. Non-rigid airships were used on coastal patrol and anti-submarine work and

later large rigid airships, the R33 and R34, were built, based on German designs. In

July 1919 the R34 was the first aircraft to cross the Atlantic from Britain to America.

Regular civil aviation developed after the war, with the first daily service from

London to Paris commencing in 1919. Several British companies joined to form

Imperial Airways in 1924 and the network for both mail and passenger transport was

gradually extended beyond Europe to outposts of the empire in Africa and Asia. In

1931 the company adopted the Handley Page aircraft, which could carry 40

passengers at 100 mph. From 1934 the Empire Flying Boat, nicknamed the ‘Queen of

the Skies’, carrying its passengers in considerable comfort, could cruise for 800 miles

at 165 mph. The British Overseas Airways Corporation (BOAC) was established

1939.

The Second World War changed the face of aviation and again brought major

advances in aircraft design and propulsion, particularly turbo-prop and jet engines,

leading to the development of much larger and faster civilian aircraft. Post-war

expansion to meet military and civil aviation requirements brought further significant

innovations, but at considerable cost. One prestige project typified the ‘white-heat of

technology’ era of the 1960s, when Britain, in co-operation with France, operated at

the limits of known technology in the race to produce a supersonic passenger

transport aircraft. Concorde was developed, in spite of escalating cost and the

uncertainty of its financial viability, swallowing hundreds of millions of pounds, in an

exercise described by one expert as ‘an unmitigated disaster without historical

parallel’.

Despite an impressive performance in aero-engines and in other sectors of

aerospace during the 1960s and 1970s, the commercial viability of some projects was

questionable and deprived routine manufacturing of talented engineers and scientists.

While remaining the third largest in the world after the USA and France, the British

aerospace industry suffered badly during the periodic crises experienced by civil

aviation and from reductions in defence orders. During the 1980s, collaborative

development of civil and military aircraft, particularly with European partners,

increased to save on costs of new production programmes.

25

http://www.encyclopedia.com/topic/France.aspx

http://www.encyclopedia.com/doc/1O110-SecondWorldWar.html

http://www.encyclopedia.com/topic/Asia.aspx

http://www.encyclopedia.com/topic/Europe.aspx

http://www.encyclopedia.com/topic/Paris.aspx

http://www.encyclopedia.com/topic/London.aspx

http://www.encyclopedia.com/topic/Britain.aspx

Defence offsets will quicken the pace of India's high-growth aerospace industry,

says Toby Simon.

From Wright Aeronautical Company to Rolls-Royce, private companies have

played a part in shaping the global aerospace industry. However, the government and

the aerospace sector are like Siamese twins.

The economic scale required for development in aerospace is large, and hence

the industry depends on the government for infrastructure development and R&D.

This dependence carries risks, as spending is subject to the political process. Hence, it

is one of the toughest markets to tap.

The government hopes to turn this constraint into an advantage through the

offset clause, mentioned in the Defence Procurement Procedure (DPP). It wishes to

encourage private sector involvement, and is hoping to have $30 billion (about Rs

140,000 crore) generated in offset opportunities.

The effective implementation of such an offset policy can facilitate the

absorption and indigenization of foreign aeronautic technologies that accrue to the

country by way of offset deals.

In doing this, the government wishes to emulate the success of Brazil, Israel

and Spain. Embraer Corporation, the Brazilian aeronautics major established in 1969,

is a noteworthy success story.

The company proved to be the leader in the absorption and indigenization of

foreign aeronautic technologies that accrued to it by way of offset deals. In the 1960's,

Embraer's first military plane, the EMB 326 Xavante trainer, was manufactured under

licence from Aeromacchi, Italy.

In the early 1970s, Embraer signed a technology transfer agreement with Piper

of the US for manufacturing Piper Seneca light Aeroplanes. In 1975, when 49 F-5

aircraft were bought by Brazil from Northrop of the US, Embraer was involved in

manufacturing several fuselage components.

26

The 1970s and 1980s saw further growth, as Embraer embarked on a co-

production arrangement with Aeromacchi and Aeritalia to build a subsonic light

attack jet fighter, the AMX. Different parts and subsystems of this aircraft, such as

engine components, multi-mode radar and head-up display, were made in Brazil

under licence arrangements.

The 1990s saw the development of SIVAM, a huge monitoring, surveillance,

communications and air traffic control system for Brazil's Amazon basin area. It was

a $1.4-billion contract that went to Raytheon, Embraer and other Brazilian companies.

The SIVAM project was a major step in technology absorption by Brazil and

served to develop local software capabilities. In 1999, with 40 per cent market share,

Embraer stood about equal to Bombardier. It is this example that the Indian

government wants to duplicate.

India already has a strong aerospace industry, and aerospace component- and

defence equipment-makers have been thriving. The country has a pool of qualified

engineering, science and computing graduates; availability of high-tech/precision

equipment, materials and consumables; established production systems; a strong IT

industry; world-class educational institutions; a good network of aeronautical

development labs; favourable geographical location and manufacturing cost

advantage.

The aerospace industry is, therefore, set to contribute substantially to India's

economic growth. Over the last 16 years, India has seen more engineering and R&D

investments in aerospace than the US or Europe.

In Bangalore, Honeywell Technology Solutions has set up an engineering

facility with over 5,500 engineers, while GE's Jack Welch Technology Centre has an

extensive research lab with over 3,000 engineers.

Airbus is setting up an Airbus Engineering Center India (AECI) facility, which

will hire 200-plus engineers of its own, and more than 2,000 through its partners.

27

Indian aerospace companies are growing too. HAL was ranked 40th in Flight

International's list of the top 100 aerospace companies last year. And the growth of

the aerospace industry has led to the opening up of spin-off opportunities in other

sectors. Offshore engineering services, for one, have seen a spurt in growth.

According to a Nasscom-Booz Allen Hamilton report, there will be a $40

billion opportunity for the offshore engineering industry worldwide by 2020. India is

expected to have a 2-3 per cent share in the aerospace offshored engineering service.

This amounts to $1.2 billion by 2011.

Growth in the aerospace industry has allowed a number of automobile

manufacturers to exploit forward and backward linkages with the aerospace industry.

India is also equipped to become a hub for maintenance, repair and overhauling

(MRO). The MRO market in India was valued at $970 million in 2008, and can

absorb massive investments.

The government, on the advice of the Kelkar Committee, has opened up the

aerospace industry to the private sector. State governments are doing their bit by

setting up special economic zones (SEZs) for the aerospace industry. These include:

The Rs 3,000-crore Aerospace and Precision Engineering Special Economic

Zone to be set up at Adibatla, Ranga Reddy district in Andhra Pradesh

The specialised aerospace park of around 1,000 acres, proposed near the

Bangalore International Airport;

The 2,500-acre SEZ for the aerospace and avionics industry, proposed to be

established in south Gujarat, close to the Delhi-Mumbai industrial corridor.

This is likely to have a number of MRO facilities.

The cumulative value of the Indian defence market for the next five years is

approximately Rs 180,000 crore (Rs 1.8 trillion), which makes it one of the most

attractive in the world -especially, with the capital outlay for defence hiked this year

to Rs 54,824 crore (Rs 548.24 billion), up from last year's revised estimate of Rs

41,000 crore (Rs 410 billion).

HINDUSTAN AERONAUTICS LIMITED

28

INTRODUCTION

The beginning of Hindustan Aeronautics Limited can be traced to the year

1940 when a far-sighted industrialist, the late Walchand Hirachand set up a company

called Hindustan Aircraft Limited in association with the Government of Mysore with

the object of establishing an Aviation Industry that can manufacture, assemble and

overhaul aircraft under license. The company was registered on December 23, 1940 as

a private limited company, with an authorised capital of Rs. 4 crore. The Production

line was established in collaboration with the Inter Continental Aircraft Company of

the USA for the manufacture of Harlow trainer, Curtiss Hawk fighter and Vultee

attack bomber. In the year 1941 the first flight of a Harlow trainer took place followed

by, the flight of India's first indigenous effort, a ten seater glider designed by Dr.

V.M. Ghatage. To support the Second World War efforts the aircraft manufacturing

programmes were abandoned in favour of repair and overhaul of aircraft and the

company became the principal overhaul base for the South East Asia Command of the

Allied forces. After World War II in December 1945 the Government of India took

over the management of the Company, and activities were increased multifold after

India attained its freedom. Between 1942 and 1945, a total of 1000 Aircraft and 3400

Engines were overhauled. The main activity for the next few years after the war was

reconditioning and conversion of war surplus Aircraft for the use of IAF and Civil

operators. In the six decades, Hindustan Aeronautics Limited has spread its wings to

cover various activities in the areas of Design, Development, Manufacture and

Maintenance. “To become a global player in the aerospace industry”

Hindustan Aeronautics Limited has blossomed into a major player in the

global aviation arena, and is today among the elite Navaratna companies. From what

was earlier the Hindustan Aircraft Limited, founded in 1940 by the great visionary

Seth Walchand Hirachand, in association with the former Princely Stat of Mysore,

Hindustan Aeronautics Limited is now ranked 34 th in the list of world’s top 100

Aviation Industries.

The Government of India became one of the shareholders of Hindustan

Aircraft Limited in March 1941 and took over the management in 1942. Hindustan

Aeronautics Limited, in it present form as a Public Sector Undertaking (PSU) under

29

the Ministry of Defence and fully owned by GoI, came into existence on October 1,

1964, when Aeronautics India Limited and Aircraft Manufacturing Depot were

merged with Hindustan Aeronautics Limited.

The company has 19 production divisions and 9 R&D centres.

Hindustan Aeronautics Limited’s expertise encompasses design, development,

production, repair, overhaul and upgrade of aircraft, helicopters, aero engines,

accessories, avionics and systems. Hindustan Aeronautics Limited has also diversified

into Industrial and Marine gas turbine engines, and structures for aerospace vehicles.

Hindustan Aeronautics Limited is largest PSU under the Department of

Defence Production, Government of India and is a ‘Navaratna’ company.

Hindustan Aeronautics Limited, with its wide spectrum of expertise in Design,

Development and Manufacture of Aircraft, Helicopters, Engines, Accessories

and Avionics has emerged as a major Aeronautical complex in Asia.

All the production Divisions in Hindustan Aeronautics Limited have ISO

9001-2000 accreditation and ten divisions have ISO 14001-1996 Environment

Management System Certification.

30

ORGANISATION STRUCTURE

31

HINDUSTAN AERONAUTICS LIMITED LOCATION AND BRANCHES

MANAGEMENT ACADEMY

Founded in August 1969 it has become a premier executive training institute

where a balanced mix of training methodology is used. Complementing this is a full-

fledged faculty of experienced line Managers and Management Consultants. It also

undertakes modular programs and custom made programmes. It has a well equipped

Library, Auditorium and Residential facilities.

AIRCRAFT DIVISION

It is established in 1940. This Division has been manufacturing a variety of

Aircraft. Currently the division is manufacturing the upgraded Jaguar Aircraft. The

division also exports high precision sub-assemblies to renowned aircraft manufactures

like Airbus and Boeing. The division is also gearing up for manufacture of HAWK

Advanced Jet Trainer.

32

ACCESSORIES DIVISION – LUCKNOW

The manufacturing range of this Division includes mechanical and hydro

mechanical, fuel system and instrument accessories for the complete range of aircraft

produced by Hindustan Aeronautics Limited. In addition the division also

manufactures a wide variety of ground support equipment. An independent Aerospace

System and Equipment R&D Centre is also attached to this Division.

TRANSPORT AIRCRAFT DIVISION – KANPUR

Originally set up for manufacture of Avro HS-748 transport aircraft, the

division today manufactures Dornier-Do -228 aircraft. The division also undertakes

repair and overhaul of HS748, HPT-32, DO-228, AN-32, Canbera and Gliders as well

as product updates, modification etc for transport aircraft.

AVIONICS DIVISION – HYDERABAD

This division undertakes production and servicing of Navigation and

Communication equipment, Airborne/Ground Radars and sub systems for aerospace

and civil applications. Design and development activities pertaining to

Communication and Radar systems are undertaken in the strategic Electronics R&D

Centre, which forms a part of the Division.

AVIONICS DIVISION – KORWA

The division manufactures and undertakes repairs and maintenance of

advanced avionics systems for military aircraft covering inertial Navigation System.

Head Up Display, Weapon Aiming Computers, Combined Map and Electronic

Display, Laser Ranger and Marked Target Seeker as well as Solid State Flight Data

Recorders.

AIRCRAFT DIVISION – NASIK

33

Established as a manufacturing base for MiG series aircraft, the division has

manufactured and overhauled a large number of MiG series aircraft. Currently the

division repairs, overhauls and upgrades, MiG 21 series, MiG 21-BIS and MiG 27. It

also manufactures flexible fuel tanks, metallic drop tanks and honeycomb structures

and variety of support equipment. This division has launched manufacture of Su-30

MKI Aircraft. The delivery of the Su-30 MKI from the Division is scheduled from

2004-05 onwards. An Aircraft upgrade R&D Centre also forms part of this Division.

ENGINE DIVISION – KORAPUT

The Division undertakes the repair and overhaul of R11, R12, R29 B and

RD-33 engines for the MiG series aircraft. The division has excellent hot forging and

precision die casting facilities for both ferrous and non-ferrous alloys. A separate

Division has been formed for the license manufacturing activities of AL-31FP engines

for Su-30 MKI. A Gas Turbine R&D Centre in the Division provides design and

liaison support to manufacturing and overhaul activities.

STRATEGIES

To be in total alignment with Corporate Strategy

Maintain Human Resource at optimum level to meet the objectives and goals

of the Company

Be competent in Mapping, Analysis and Upgradation of Knowledge and

Skills including Training, Re-training, Multi-skilling etc.

Cultivate Leadership with Shared Vision at various levels in the Organization

Focus on Development of Core Competence in High-Tech areas

Build Cross-functional Teams

Create awareness of Mission, Values and Organizational Goals through out

the Company

Introduce / Implement personnel policies based on performance that would

ensure growth, Rewards, Recognition, Motivation

VISION

"To make HAL a dynamic, vibrant, value-based learning organisation with

human resources exceptionally skilled, highly motivated and committed to meet the

34

current and future challenges. This will be driven by core values of the Company fully

embedded in the culture of the Organisation"

MISSION

To become a globally competitive Aerospace Industry while working as an

instrument for achieving self-reliance in Design, Manufacture and Maintenance of

Aerospace Defence equipment and diversifying to related areas, managing the

business on commercial lines in a climate of growing professional competence.

TRUST AND TEAM SPIRIT

We believe in achieving harmony in work-life through mutual trust,

transparency, co-operation, and a sense of belonging. We will strive for building

empowered teams to work towards achieving organizational goals.

RESPECT FOR THE INDIVIDUAL

We value our people. We will treat each other with dignity and respect and

strive for individual growth and realization of everyone's full potential.

INTEGRITY

We believe in a commitment to be honest, trustworthy, and fair in all our

dealings. We commit to be loyal and devoted to our organization. We will practice

self discipline and own responsibility for our actions. We will comply with all

requirements so as to ensure that our organization is always worthy of trust.

35

PRODUCT PROFILE

Aircraft designed and developed by Hindustan Aeronautics Limited

HT-2 Piston-engined trainer

Pushpak Light aircraft for flying clubs

KrishakAir Observation Post

Marut(HF-24) Ground Attack Jet Fighter

Marut Trainer Operational Trainer

Kiran Mk.I and IA and II Basic Jet Trainer

Basant Agricultural Aircraft

Ajeet Light Fighter

HPT-32 Piston-engined Trainer

HTT-34 Turboprop Variant

Aircraft produced under license at Hindustan Aeronautics Limited

Percival Prentice Trainer

VampireFighter-Bomber

Gnat Intercepter

Mig-21 FL Intercepter

Mig-21 bis Ground Attack

Jaguar Multi-role Fighter

Mig-27 Ground Attack

Avro(HS-748) Medium Transport

Dornier-228 Light Transport

Chetak Utility Helicopter

Cheetah R and O

36

CUSTOMERS PROFILE

Established initially to cater to Indian Air Force, today the list of their

esteemed and satisfied customers includes:

Indian Air Force

Indian Army

Indian Navy

Coast Guard

Civil Aviation Sector

Indian Space Research Organisation

Defence Research & Development Organisations

Centre for Airborne Systems

Ship Building Industries GRSE, MDL, GSL, HSL

Public Sector Undertakings

State Police Departments

Other Sister Divisions of Hindustan Aeronautics Limited

37

ORGANISATION GROWTH OF HAL

38

Expansion of Nasik Division as Aircraft Manufacturing Division and Aircraft Overhaul Division

Establishment ofSukhoi Engine Division

at Koraput

Establishment ofAirport Service Centre

for coordinating the operations at HAL Airport, Bangalore

Establishment ofIndustrail & Marine Gas Turbine Division

for coordinative gas turbines/Industrial engines

Establishment ofAero Space Division

for Structure of Aerospace Launch Vehicles

Establishment ofKorwa Division

for Advanced Avionics

Establishment ofFoundry & Forge Division

At, Bangalore

Establishment ofHelicopter Division

at, Bangalore

Establishment of Lucknow Division for Accessories & Instruments

Formation ofHindustan Aeronautics Limited

By Merger of 3 Companies

Establishment of Aeronautics India LimitedAt Nasik, Koraput & Hyderabd for MiG Airframe, Denines & Avionics

Establishment ofAircraft Manufacturing Depot

At Kanpur for HS-748

Establishment ofEngine DivisionAt Bangalore

Hindustan Aircraft Limitedat Bangalore

2002

2000

1998

1988

1982

1974

1970

1964

1962

1960

1940

FINANCIAL HIGHLIGHTS:

Hindustan Aeronautics Limited (HAL) has cruised past the Rs.7,500-crore

mark for the first time with a sales turnover of Rs.7,783.61 crores ($1.82 billion)

during the Financial Year 2006-07, The Value of Production has also gone up by

55.54% to Rs. 9,201.88 crores, while the Profit of the Company (Profit Before Tax)

soared to Rs.1,743.60 crores, which is an increase of 54.88% over the previous year's

performance.

The highlights are given below:

Rupees in Crores

Particulars 2005-06 2006-07

Growth over Previous

Year

Sales 5342 7783 45.69%

VOP 5916 9202 55.54%

Profit before tax 1126 1744 54.88%

Profit after tax 771 1149 49.03%

Gross Block 1694 2081 22.85%

39

Awards:

The Avionics Division, Hyderabad has been accredited with ISO-9001

CERTIFICATION and accomplished the following milestone.

First prize in the field of Strategic Electronics during 1991 from Department

of Electronics, Govt. of India.

National Award for R&D in Electronics from DSIR, Ministry of Science and

Technology.

ISO 9001 Certification for design, development, production and servicing.

Qualification approval for Printed Circuit Boards from LCSO.

Accreditation by National Accreditation board for test and calibration

laboratories.

Qualification approval for the hybrid manufacturing for the Aerospace

application.

Fitment of indigenously developed avionics on all the aircraft acquired by

Indian Defence Services.

Services:

Retro - modification

HAL has developed a specialised 'Flight Test Group' with expertise in trial

installation of Avionic systems on Fixed and Rotary wings of Combat and Transport

Aircraft. This group has achieved success in installing its latest Avionic systems on

MiG-21 series, MiG-23, MiG-27M, MiG-29, IL-38, Su-30 MKI, HS 748, and TU-142

series of aircraft and also on helicopters like MI - 8, MI - 25, Seaking, Chetak and

Cheetah. It has exhibited complete self-sufficiency for conducting feasibility studies,

manufacturing of Mod Kits, Installation and Flight Testing of Avionic systems.

Repair and Overhaul

40

HAL has excellent facilities and procedures for defect investigation, repair and

overhaul of Russian, Western and indigenous air-borne equipment. Our Engineers

have vast experience in all these systems and they also carry out field repairs. The

principle of Inspect and Repair as Necessary (IRAN) is followed, which means that

the equipment need not be sent for regular / periodic overhaul. The repair facilities are

available from first generation to fourth generation equipment with frequencies from

DC to 40 GHz.

41

CHAPTER – V

DATA ANALYSIS & INTERPRETATION

42

1. Since how long have you been working in HAL?

ATTRIBUTESNO. OF

RESPONDENTS% OF RESPONDANTS

For the past 0-2 years 2 1.98



For the past 11 years & above 34 33.66

Total 101 100

Interpretation:

The above table shows that 1.98% i.e., 2 respondents have been working for

the past 0-2 years, 42.57% i.e., 43 respondents have been working for the past 2-5

years, 21.78% i.e., 22 respondents have been working for the past 5-10 years, 33.66%

i.e., 34 respondents have been working for the past 11 years & above in the

organization.

NO. OF RESPONDENTS

2%

42%

22%

34%

for the past 0-2 years



for the past 11 years &above

43

2. The System of PAR which is followed in HAL

ATTRIBUTES NO. OF RESPONDENTS % OF RESPONDANTS

Highly Satisfied 4 3.96

Satisfied 77 76.24

Dissatisfied 16 15.84

Highly Dissatisfied 4 3.96

Total 101 100.00

Interpretation:

The above table shows that 76.24% i.e., 77 respondents are satisfied with the

system of PAR, 15.84% i.e., 16 respondents are dissatisfied with the system of PAR,

3.96% i.e., 4 respondents are highly satisfied and 3.96% i.e., 4 respondents are highly

dissatisfied with the system of PAR followed in HAL.

80.20% of the Officers are satisfied with the system of PAR which is

followed in HAL.

4%

76%

16%

4%

Highly Satisfied

Satisfied

Dissatisfied

Highly Dissatisfied

44

3. Evaluation of Officers' performance on quarterly basis


Excellent 9 8.91

Very Good 30 29.70

Good 45 44.55

Average 17 16.83

Total 101 100

Interpretation:

The above table shows that 44.55% i.e., 45 respondents says that evaluation of

the Officers’ performance on quarterly basis is good.

29.70% i.e., 30 respondents says it is very good, 16.83% i.e., 17 respondents

says it is average and only 8.91% i.e., 9 respondents says that evaluation of Officers’

performance on quarterly basis is excellent.

On an average it is evident from the analysis that (8.91%+29.70%+44.55%)

83.16% of Officers agree that the system of quarterly evaluation is good.

9%

30%

44%

17%

Excellent

Very Good

Good

Average

45

4. The Scale of gradation which is followed in HAL for PAR



Satisfied 76 75.25



Total 101 100.00

Interpretation:

The above table shows that 75.25% i.e., 76 respondents are satisfied with the

scale of gradation followed in the organization.

13.86% i.e., 14 respondents are dissatisfied, 5.94% i.e., 6 respondents are

highly satisfied and 4.95% i.e., 5 respondents are highly dissatisfied with the scale of

gradation followed in the organization.

Scale of Gradation needs no changes as 75% of Officers are satisfied.

6%

75%

14%

5%

Highly Satisfied

Satisfied

Dissatisfied

Highly Dissatisfied

46

5. Devotion of 40% of marks in quarterly task sheets for improvement task


Excellent 14 13.86

Very Good 17 16.83

Good 42 41.58

Average 28 27.72

Total 101 100

Interpretation:

The above table shows that 41.58% i.e., 42 respondents says that the policy of

devoting of 40% marks in quarterly task sheets for improvement task is good.

27.72% i.e., 28 respondents says it is average, 16.83% i.e., 17 respondents

says it is very good.

And very less percentage of 13.86 i.e., 14 respondents says the policy of

devoting of 40% marks in quarterly task sheets for improvement task is excellent.

Defining improvement task for each quarter may be very difficult. Further the

marks assigned to improvement task can be reduced.

47

14%

17%

41%

28%

Excellent

Very Good

Good

Average

6. Receiving of feedback on your performance by your boss



Satisfied 62 61.39



No Answer 1 0.99

Total 101 100.00

Interpretation:

The above table shows that 61.39% i.e., 62 respondents are satisfied to receive

feedback on their performance by their boss.

16.83% i.e., 17 respondents are highly satisfied, 15.84% i.e., 16 respondents

are dissatisfied, 4.95% i.e., 5 respondents are highly dissatisfied, 0.99% i.e., 1

respondent did not give answer.

From the above table it can be known that most of the respondents are

satisfied with receiving feedback on their performance by their boss.

48

17%

61%

16%

5%

1%

Highly Satisfied

Satisfied

Dissatisfied

Highly Dissatisfied

No Answer

7. The present system of PAR is too-time consuming


Strongly Agree 10 9.90

Agree 41 40.59

Disagree 43 42.57

Strongly Disagree 7 6.93

Total 101 100.00

Interpretation:

The above table shows that 42.57% i.e., 43 respondents are disagreeing that

the present system of PAR is too – time consuming.

40.59% i.e., 41 respondents are agreeing that the present system of PAR is too

– time consuming, 9.9% i.e., 10 respondents are strongly agreeing that the present

system of PAR is too – time consuming.

And only 6.93% i.e., 7 respondents are strongly disagreeing that the present

system of PAR is too – time consuming.

This is a contradictory situation that 50% of Officers agree that PAR system is

too-time consuming and other 50% disagree with this statement.

49

10%

41%42%

7%

Strongly Agree

Agree

Disagree

Strongly Disagree

8. Ratings are sometimes seen as based on subjective judgment



Agree 71 70.30

Disagree 18 17.82


Total 101 100.00

Interpretation:

The above table reveals that 70.3% i.e., 71 respondents agree that the ratings

are sometimes seen as based on subjective judgement, the respondents mostly belongs

to SLRDC, QC, HR and Communication Departments.

17.82% i.e., 78 respondents disagree that the ratings are sometimes based on

subjective judgement, 10.89% i.e., 11 respondents strongly agree. And 0.99% i.e.,

only 1 respondent out of total sample strongly disagree that the ratings are sometimes

seen as based on subjective judgement.

80% of the Officers are agreeing with the fact that the ratings are based on

subjective judgment.

50

11%

70%

18%1%

Strongly Agree

Agree

Disagree

Strongly Disagree

9. Training is given subsequently as recommended in PAR



Agree 34 33.66

Disagree 38 37.62


Total 101 100.00

Interpretation:

The above table shows that 37.62% i.e., 38 respondents disagree that the

training is given subsequently as recommended in PAR.

33.66% i.e., 34 respondents agree that the training is given subsequently as

recommended in PAR, 21.78% i.e., 22 respondents strongly disagree that the training

is given subsequently as recommended in PAR.

And only 6.93% i.e., 7 respondents strongly agree that the training is given

subsequently as recommended in PAR.

51

As 60% disagree with the statement so steps can be taken to ensure that the

training recommended in PAR is given to the Officers and more training programs are

to be organized.

7%

34%

37%

22%

Strongly Agree

Agree

Disagree

Strongly Disagree

10. Replacing present PAR system with online PAR system



Agree 54 53.47

Disagree 13 12.87


No answer 1 0.99

Total 101 100.00

Interpretation:

The above table shows that the 53.47% i.e., 54 respondents agree with the

replacing of present PAR system with online PAR system and most of them belong to

SLRDC, QC, Purchase and Communication departments.

27.72% i.e., 28 respondents strongly agree with it and 12.87% i.e., 13

respondents disagree with the above statement.

52

4.95% i.e., 5 respondents strongly disagree with the above statement and one

respondent did not give the answer as he is not aware of what is online PAR system.

81% of the Officers agree that present PAR system should be replaced with

online PAR system.

28%

53%

13%

5%

1%

Strongly Agree

Agree

Disagree

Strongly Disagree

No answer

11. Quarterly task setting & evaluation are done as per schedule



Agree 57 56.44

Disagree 30 29.70


Total 101 100.00

Interpretation:

The above table reveals that the 56.44% i.e., 57 respondents agree that the

quarterly task setting & evaluation are done as per the schedule.

53

29.7% i.e., 30 respondents disagree, 8.91% i.e., 9 respondents strongly

disagree and only 4.95% i.e., 5 respondents strongly agree that the quarterly task

setting and evaluation are done as per the schedule.

5%

56%

30%

9%

Strongly Agree

Agree

Disagree

Strongly Disagree

12. Subordinates are rated based upon his/her performance



Agree 69 68.32

Disagree 13 12.87


Total 101 100.00

Interpretation:


Subordinates are rated based upon his/her performance.

15.84% i.e., 16 respondents strongly agree, 12.87% i.e., 13 respondents

disagree and only 2.97% i.e., 3 respondents strongly disagree that the subordinates are

rated based upon his/her performance.

54

83% of Officers agreeing that the subordinates are rated based upon his/her

performance on the other hand 80% of the Officers are agreeing with the fact that the

ratings are based on subjective judgment these two sentence are contradictory.

16%

68%

13%3%

Strongly Agree

Agree

Disagree

Strongly Disagree

13. Self-appraisal is taken into consideration while performance is appraised



Agree 71 70.30

Disagree 19 18.81


No answer 1 0.99

Total 101 100.00

Interpretation:


self-appraisal is taken into consideration while performance is appraised and most of

them belong to Communication, HR, IT, MSD, Purchase, QC and SLRDC

departments.

55

18.81% i.e., 19 respondents disagree, 7.92% i.e., 8 respondents strongly agree,

1.98% i.e., 2 respondents strongly disagree that the self-appraisal is taken into

consideration while performance is appraised and one respondent did not respond to

the above statement.

8%

70%

19%

2%

1%

Strongly Agree

Agree

Disagree

Strongly Disagree

No answer

14. Your IA appraises you about your performance while evaluating the quarterly task

sheets & PAR



Agree 67 66.34

Disagree 19 18.81


Total 101 100.00

Interpretation:

The above table reveals that 66.34% i.e., 67 respondents agree that their IA

appraises their performance while evaluating the quarterly task sheets & PAR,

18.81% i.e., 19 respondents disagree with it, 12.87% i.e., 13 respondents strongly

agree with it.

56

Only 1.98% i.e., 2 respondents out of the whole sample strongly disagree that

their IA appraises them about their performance while evaluating the quarterly task

sheets & PAR.

13%

66%

19%

2%

Strongly Agree

Agree

Disagree

Strongly Disagree

15. You are fully aware about the PAR system being followed in HAL



Agree 71 70.30

Disagree 8 7.92


Total 101 100.00

Interpretation:

The above table shows that 70.30% i.e., 71 respondents agree that they are

fully aware about the PAR system being followed in HAL, 20.79% respondents

strongly agree that they are fully aware about the PAR system being followed in

HAL.

57

7.92% i.e., 8 respondents disagree that they are full aware about the PAR

system followed in HAL and only 0.99% i.e., 1 respondent strongly disagree that

he/she is fully aware about the PAR system being followed in HAL.

21%

70%

8% 1%

Strongly Agree

Agree

Disagree

Strongly Disagree

16. Your relation with your boss


Excellent 22 21.78

Very Good 49 48.51

Good 25 24.75

Average 5 4.95

Total 101 100

Interpretation:

The above table shows that 48.51% i.e., 49 respondents says their relation with

the boss is very good, 24.75% i.e., 25 respondents says it is good.

21.78% i.e., 22 respondents says that their relation with the boss is excellent

and only 4.95% i.e., 5 respondents says that their relation with the boss is average.

95% of the officers are having very good relations with the boss.

58

22%

48%

25%

5%

Excellent

Very Good

Good

Average

17. Your relation with your subordinate


Excellent 30 29.70

Very Good 54 53.47

Good 17 16.83

Average 0 0.00

Total 101 100

Interpretation:

The above table shows that 53.47% i.e., 54 respondents says that their relation

with the subordinates is very good.

29.70% i.e., 30 respondents says that it is excellent and 16.83% i.e., 17

respondents says that the relation with the subordinates is good.

It was very much interesting to know that 100% of the Officers said that their

relations with their subordinates are good.

59

30%

53%

17%0%

Excellent

Very Good

Good

Average

18. Boss encourages you to approach him frequently for his advice and help



Agree 63 62.38

Disagree 6 5.94


Total 101 100.00

Interpretation:

The above table shows that 62.38% i.e., 63 respondents agree that their boss

encourages them to approach him frequently for his advice and help, 28.71% i.e., 29

respondents strongly agree with it.

5.94% i.e., 6 respondents disagree with it and 2.97% i.e., 3 respondents

strongly disagree that their boss encourages them to approach him frequently for his

advice and help.

60

29%

62%

6% 3%

Strongly Agree

Agree

Disagree

Strongly Disagree

19.. You are helping your subordinates to become aware of some of their own

strengths



Agree 65 64.36

Disagree 1 0.99


Total 101 100.00

Interpretation:

The above table reveals 64.36% i.e., 65 respondents agree that they are

helping their subordinates to become aware of some of their own strengths, 32.67%

i.e., 33 respondents strongly agree with it, 1.98% i.e., 2 respondents strongly disagree

with the above statement.

And 0.99% i.e., 1 respondent out of the whole sample disagree with that

he/she is helping subordinates to become aware of some of their own strengths.

61

33%

64%

1%

2%

Strongly Agree

Agree

Disagree

Strongly Disagree

20. You clearly prescribe standards of behavior to be followed in your work unit



Agree 67 66.34

Disagree 10 9.90


Total 101 100.00

Interpretation:

The above table shows 66.34% i.e., 67 respondents agree, 22.77% i.e., 23

respondents strongly agree, 9.9% i.e., 10 respondents disagree that they clearly

prescribe standards of behaviour to be followed in their work unit.

And only 0.99% i.e., 1 respondent says he / she strongly disagree that he/she

clearly prescribes standards of behaviour to be followed in work unit.

89.11% of the Officers are agreeing that they clearly prescribe standards of

behaviour to be followed in their work unit.

62

23%

66%

10% 1%

Strongly Agree

Agree

Disagree

Strongly Disagree

63

Crosstabs

Designation * 4.Scale of gradation

H0: There is no significance difference between designation and their opinions on scale of gradation is followed in HAL for PAR

Crosstab4.Scale of gradation Total

Highly Satisfied Satisfied Dissatisf

ied

Highly Dissatisf

ied

Designation

EngineerCount 0 23 2 1 26% within Designation

0.0% 88.5% 7.7% 3.8% 100.0%

ManagerCount 1 32 8 0 41% within Designation

2.4% 78.0% 19.5% 0.0% 100.0%

OfficerCount 0 34 4 2 40% within Designation

0.0% 85.0% 10.0% 5.0% 100.0%

TotalCount 1 89 14 3 107% within Designation

0.9% 83.2% 13.1% 2.8% 100.0%

Chi-Square Tests

Value df Asymp. Sig. (2-sided)

Pearson Chi-Square 5.944a 6 .429Likelihood Ratio 7.217 6 .301N of Valid Cases 107

a. 7 cells (58.3%) have expected count less than 5. The minimum expected count is .24.

From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on scale of gradation is followed in HAL for PAR

64

Designation * 7.System of PAR

H0: There is no significance difference between designation and their opinions on the present system of PAR is too-time consuming

Crosstab7.System of PAR Total

Strongly Agree

Agree Disagree Strongly Disagree

Designation


11.5% 53.8% 26.9% 7.7% 100.0%


9.8% 75.6% 14.6% 0.0% 100.0%


0.0% 72.5% 27.5% 0.0% 100.0%


6.5% 69.2% 22.4% 1.9% 100.0%

Chi-Square Tests




From the above table chi square is significant (sig. value is less than 0.05), reject null hypothesis. It means that there is a significance difference between designation and their opinions on the present system of PAR is too-time consuming

65

Designation * 8.Ratings

H0: There is no significance difference between designation and their opinions on ratings based on subjective judgment

Crosstab8.Ratings Total

Strongly Agree


Designation


15.4% 80.8% 3.8% 0.0% 100.0%


7.3% 87.8% 2.4% 2.4% 100.0%


5.0% 90.0% 5.0% 0.0% 100.0%


8.4% 86.9% 3.7% 0.9% 100.0%

Chi-Square Tests




From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on ratings based on subjective judgment

66

Designation * 12.Quarterly task setting

H0: There is no significance difference between designation and their opinions on quarterly task setting and evaluation are done as per schedule

Crosstab12.Quarterly task setting Total

Strongly Agree


Designation


11.5% 53.8% 34.6% 0.0% 100.0%


4.9% 39.0% 51.2% 4.9% 100.0%


7.5% 75.0% 15.0% 2.5% 100.0%


7.5% 56.1% 33.6% 2.8% 100.0%

Chi-Square Tests




From the above table chi square is significant (sig. value is less than 0.05), reject null hypothesis. It means that there is a significance difference between designation and their opinions on quarterly task setting and evaluation are done as per schedule

67

Designation * 15.IA Appraises

H0: There is no significance difference between designation and their opinions on IA appraises performance evaluating quarterly task sheets and PAR

Crosstab

15.IA Appraises Total

Strongly Agree

Agree Disagree

Strongly Disagre

e

Designation

EngineerCount 0 22 3 1 26

% within Designation

0.0% 84.6% 11.5% 3.8% 100.0%


7.3% 65.9% 19.5% 7.3% 100.0%


5.0% 80.0% 5.0% 10.0% 100.0%

TotalCount 5 81 13 8 107


4.7% 75.7% 12.1% 7.5% 100.0%

Chi-Square Tests



a. 9 cells (75.0%) have expected count less than 5. The minimum expected count is 1.21.

From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on IA appraises performance evaluating quarterly task sheets and PAR

68

Designation * 18.Relation with subordinate

H0: There is no significance difference between designation and their opinions on relation with subordinate

Crosstab

18.Relation with subordinate Total

Excellent

Very Good

Good Average

Designation

EngineerCount 5 10 11 0 26


19.2% 38.5% 42.3% 0.0% 100.0%


12.2% 65.9% 22.0% 0.0% 100.0%


10.0% 55.0% 32.5% 2.5% 100.0%

TotalCount 14 59 33 1 107


13.1% 55.1% 30.8% 0.9% 100.0%

Chi-Square Tests




From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on relation with subordinate

69

Designation * 19.Boss encourages

H0: There is no significance difference between designation and their opinions on boss encouragement

Crosstab

19.Boss encouragement Total

Strongly Agree


Designation


23.1% 69.2% 3.8% 3.8% 100.0%


14.6% 63.4% 19.5% 2.4% 100.0%


7.5% 87.5% 5.0% 0.0% 100.0%


14.0% 73.8% 10.3% 1.9% 100.0%

Chi-Square Tests




From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on boss encouragement

70

Designation * 22.Instructions to subordinate

H0: There is no significance difference between designation and their opinions on give clear instructions to subordinate

Crosstab22.Instructions to subordinate Total

Strongly Agree


Designation


19.2% 76.9% 0.0% 3.8% 100.0%


46.3% 48.8% 4.9% 0.0% 100.0%


42.5% 57.5% 0.0% 0.0% 100.0%


38.3% 58.9% 1.9% 0.9% 100.0%

Chi-Square Tests




From the above table chi square is not significant (sig. value is greater than 0.05), no need to reject null hypothesis. It means that there is no significance difference between designation and their opinions on give clear instructions to subordinate

71

Regression

Model Summary

Model R R Square Adjusted R Square

Std. Error of the Estimate

1 .398a .158 .134 .633

a. Predictors: (Constant), 21.Behaviour in work unit, 12.Quarterly task setting, 18.Relation with subordinate

ANOVAa

Model Sum of Squares

df Mean Square F Sig.

1

Regression 7.739 3 2.580 6.444 .000b

Residual 41.233 103 .400

Total 48.972 106

a. Dependent Variable: 3.Evaluation of officersb. Predictors: (Constant), 21.Behaviour in work unit, 12.Quarterly task setting, 18.Relation with subordinate

Coefficientsa

Model Unstandardized Coefficients

Standardized Coefficients

t Sig.

B Std. Error Beta

1

(Constant) 1.558 .308 5.066 .000

12.Quarterly task setting

.283 .096 .272 2.935 .004

18.Relation with subordinate

.241 .095 .235 2.525 .013

21Standards followed in work unit

.047 .104 .043 .457 .649

a. Dependent Variable: 3.EvaluatSion of officers

The required regression line is Evaluation of officers performance =1.558+0.283(Quarterly task setting) + 0.241(Relation with subordinate) + 0.047(Standards followed in work unit)

72

CHAPTER – VI

DISCUSSIONS & CONCLUSIONS

DISCUSSIONS:

It is observed that most of the Officers are satisfied with the system of PARs

which is followed in HAL.

Most of the Officers agree that the system of evaluation of Officers’

performance on quarterly basis is good.

The scale of gradation followed in HAL is satisfied by most of the Officers.

So, it requires no changes.

Defining improvement task for each quarter may be very difficult. Further the

marks assigned to improvement task can be reduced.

Officers are satisfied to receive the feed back by their boss.

The Officers are equally agreed and disagree that the present PAR system is

too time consuming, this is a contradictory situation.

Most of the Officers are agreeing with the fact that the ratings are some times

based on subjective judgement.

60% of the Officers are disagreeing with the statement that the training is

given subsequently as recommended in PAR.

It is observed that more than 80% of the officers agree that the present PAR

system should be replaced with online PAR system.

More than 50% Officers agreed that the Quarterly task setting & evaluation

are done as per schedule.

73

Most of the Officers are agreeing that the subordinates are rated based upon

his/her performance on the other hand Officers said that the ratings are based

on subjective judgement. These two sentences are contradictory.

Self-appraisal is taken into consideration while performance is appraised.

Most of the Officers said that their IA appraises their performance while

evaluating the quarterly task & PAR.

95% of the officers are having very good relations with their boss and 100% of

the Officers are having very good relations with their subordinates.

Almost all the Officers are fully aware of PAR system followed in HAL.

Most of the Officers said that their boss encourages them to approach him

frequently for advice and help.

Most of the Officers said that they help their subordinates to become aware of

some of their own strengths.

Most of the officers said that they give clear instruction to their subordinates

that what should and what should not be done.

More than 50% agree that they do not hesitate to criticize their subordinates

for their bad performance even if they feel offended and do not accept their

feed back.

It is found that the Officers are learning new things and they are improving

their skills in their present discipline.

Bosses are concerned about their subordinates and are communicating

feedback to their subordinates on their performance.

74

Most of the Officers said that re-introduction of IMS scheme motivated them

to excel in their work area.

It is observed that the policy of conducting written test, service eligibility for

next grade and deferring of promotion on bases of LWP require no change.

Most of the Officers agree that there should be job rotation on promotion.

It is observed that the procedure followed for the promotion of Officers is not

satisfactory one of the reasons could be delay in processing of promotions.

The present PAR system can be replaced with 360 degrees PAR system as the

360 degree system gives the correct picture above the Officer and PAR system

should be made Online.

Feed back should be given to the Officers on their performance whether it is

good or bad so that they can improve themselves.

The marks assigned for the improvement task can be reduced.

Steps should be taken to ensure that the training recommended in PAR is

given to the officers and more training programmes are organized.

It should be ensured that the Promotion processes are carried out as per

schedule so that Promotion Orders are issued in time.

The Question Banks which were used for various disciplines in the online

written test should be revised and made more relevant to the disciplines.

75

After taking a hard look at the performance management system at Hindustan

Aeronautics Ltd, what I have experienced is that the working conditions are very

good. There is good friendly relation prevailing between the employees. Even the

subordinates respect the top management.

But what I have noticed is that there is a lack of job satisfaction among the

employees.

I would like to give few suggestions, through which, I guess the organization

can improve its standard.

1. The management should give its employees more challenging work.

2. The organization can conduct the appraisal of their employee’s performance

twice in a year instead of doing it once in a year.

3. The management should give regular feedback of the employee’s

performance. So that the employees can have the idea of how they are

performing.

4. The organization can go for 360 degrees appraisal method, which I think will

be the most effective than the method they are using at the moment.

CONCLUSION

76

The study is done to know the satisfaction level of employee’s performance on

their present job. Performance appraisal is the evaluation of employee’s performance

at his present job and also process by which the employee’s strengths and weakness

are identified to improve the performance on the present jobs.

The basic purpose of performance appraisal is to know how well the employee

is performing on the job, and to establish a plan for their improvement. To find out

this, I have made a detailed study at Hindustan Aeronautics limited, Balanagar where

the performance appraisal system is easy to understand.

In the organization the top management provides awards and rewards to the

part of performance appraisal system in sales department. The employees who are

reached their highest target regarding sales, those persons will get awards and

rewards.

In Hindustan Aeronautics Limited, Balanagar the frequency of the system can

also be increased, where the confidentiality must be strictly maintained, and rating

should be made without any bias-recognition at par with the employee’s performance

can be made and the participation of the top management can make the performance

appraisal system more effective. This performance appraisal gives a clear idea about

good relation between top management and employees.

Thus the appraisal system in Hindustan Aeronautics Limited, Balanagar

maintained very effectively. The outcomes also has given efficiently.

However the above study has been successfully understanding and

highlighting performance appraisal system in the organization.

77

BIBLIOGRAPHY

78

1. P. Subba Rao, “Essentials of Human Resource Management And Industrial

Relations”, 3rd Edition, Himalaya Publishing House.

2. K. Aswathappa, “Human Resource And Personnel Management”, 3rd Edition,

Tata McGraw Hill.

3. C.R.Kothari (1990), Research Methodology Methods and Techniques, Second

edition – New Age International Publishers, New Delhi.

4. Human Capital Journal.

Websites:

1. www.hal-india.com

2. www.google.com

3. www.citehr.com

4. www.managementparadise.com

5. www.citeops.com

79

http://www.citeops.com/

http://www.managementparadise.com/

http://www.citehr.com/

http://www.google.com/

http://www.hal-india.com/

As a part of my MBA Curriculum, I am doing this project titled “A Study on

Performance Management System of Officers at HAL, Hyderabad”. To do my

project successfully I need your cooperation by way of filling this questionnaire for

which I will be very thankful to you. I assure you that this is purely for academic

purpose and your responses will be kept confidential.

EMPLOYEE DETAILS:

Name :

Age :

Department :

Designation :

Q1. Since how long have you been working for HAL?

(a) for past 0-2 years (b) for past 2-5 years

(c) for past 5-10 years (d) for past 11 years & above [ ]

Q2. The system of PAR which is followed in HAL

(a) Highly satisfied (b) Satisfied

(c) Dissatisfied (d) Highly dissatisfied[ ]

Q3. Evaluation of officers’ performance on quarterly basis

(a) Excellent (b) Very Good

(c) Good (d) Average [ ]

Q4. The scale of gradation which is followed in HAL for PAR

80



Q5. Devotion of 40% of marks in quarterly task sheets for improvement task



Q6. Receiving of feedback on your performance by your boss



Q7. The present system of PAR is too-time consuming

(a) Strongly agree (b) Agree

(c) Disagree (d) Strongly disagree [ ]

Q8. Ratings are sometimes seen as based on subjective judgement



Q9. Training is given subsequently as recommended in PAR



Q10. Replacing present PAR system with online PAR system



81

Q11. If your boss brings out while giving feedback that your performance is not up

to the mark then how would you react? (Tick as many as possible)

(a) Take feedback positively.

(b) Try to improve on shortcomings.

(c) Try to convince boss that he has not done assessment correctly.

(d) Take feedback negatively. [ ]

Q12. Quarterly task setting & evaluation are done as per schedule



Q13. Subordinates are rated based upon his/her performance?



Q14. Self-appraisal is taken into consideration while performance is appraised



Q15. Your IA Appraises you about your performance while evaluating the quarterly

task sheets & PAR?



Q16. You are fully aware about the PAR system being followed in HAL



82

Q17. Your relations with your boss



Q18. Your relations with your subordinate



Q19. Boss encourages you to approach him frequently for his advice and help



Q20. You are helping your subordinates to become aware of some of their own

strengths



Q21. You clearly prescribe standards of behaviour to be followed in your work unit



Q22. Give clear instructions to your subordinate what should or should not be done



Q23. I communicate strong feelings to subordinates without caring whether this will

affect their morale



Q24. I try to set an example to my subordinates by my own behaviour


83


Q25. I do not hesitate to criticize my subordinates for their bad performance even if

they feel offended and do not accept my feedback



Q26. I am available to my subordinates to solve their problems



Q27. I enjoy my role very much because of the tremendous opportunities for my

professional development here



Q28. I do only routine things and have learnt nothing new



Q29. I am slowly forgetting all that I learnt in my discipline



Q30. Are you receiving feedback on your performance?

(a) Yes (b) No [ ]

Q31. If you are writing PARs as IA/RA then, on what basis are you rating your

subordinates as Cat - A, Cat - B or Cat - C?

----------------------------------------------------------------------------------------------

------------------------------------------------------------------------

84

Q32. If you are filling PAR as IA/RA, are you giving feedback to your

subordinates?

----------------------------------------------------------------------------------------------

------------------------------------------------------------------------

Q33. Are you satisfied with the system of PAR which is followed in HAL? Justify.

----------------------------------------------------------------------------------------------

------------------------------------------------------------------------

Q34. If you feel there should be some modifications in the PAR System, what all

the changes do you want to make?

----------------------------------------------------------------------------------------------

------------------------------------------------------------------------

Q35. The promotion policy of the organization



Q36. Re-introduction of Internal Merit Selection (IMS) motivates you to excel in

your work area.



Q37. The written test is helping officers to improve their knowledge



85

Q38. The policy of serving 3yrs. & 4yrs in the lower grade for promotion under

IMS & DPC respectively



Q39. The promotion should be deferred based upon the ‘Leave without pay’



Q40. The procedure/process which is followed for promoting of Officers



Thank you

86

Final Project

Documents

foreign aeronautic

reject null

hindustan

quarterly

human resource

defining improvement

minimum expected

hindustan