SUMMER TRAINING PROJECT REPORT

ON

A Study on Performance
Appraisal System at HDFC BANK
Lucknow
Towards partial fulfilment of
Master of Business Administration (MBA)
(Affiliated to U. P. Technical University, Lucknow)
Industry Guide:
Mr. A. S. Yadav
(Manager)
HDFC, Lucknow

Faculty Guide:
Ms. Meetu Pandey
(Asst. Professor)
BBD NITM, Lucknow
Submitted by:
Jaya Rai
Roll no: 1505470023
M.B.A. 3rd Semester

SESSION 2016-2017
DEPARTMENT OF MANAGEMENT

Babu Banarasi Das

National Institute of Technology & Management
Sector 1, Akhilesh Das nagar, Faizabad Road, Lucknow (U. P.), India

ACKNOWLEDGEMENT
The present work is an effort to throw some light on A Study on Performance
Appraisal System at HDFC BANK Lucknow. The work would not have been
possible to come to the present shape without the able guidance, supervision and
help to me by number of people.
With deep sense of gratitude I acknowledge the encouragement and guidance
received by my Faculty Guide Ms. Meetu Pandey and other staff members.
I convey my heart full affection to all those people who helped and supported me
during the course, for completion of my Project Report.

(Jaya Rai)

Preface
The Training project program is the integral part of MBA curriculum during the
course of management; the research is expected to use and apply their academic
knowledge and gain a valuable insight into corporate culture with all its
environment operational complexities.
The summer training offers a valuable opportunity to the researcher to meet their
academic knowledge to the real world situation. I have undertaken commercial
department to study about the various activities done in this department in the
details, as the result of that I came out with the project title A Study on
Performance Appraisal System at HDFC BANK Lucknow.
In this report I have put my finest efforts to compile the data with utmost
accuracy and hope this report will give complete satisfaction regarding the
various aspects of HR.

(Jaya Rai)

Executive Summary
This project report is a review based on theory as well as the industry outlook of
performance appraisal system of the organization.
The report starts with the Introduction and Literature Review of performance
appraisal system that outlines its history, definitions, purposes, types, process,
methods, appraiser, parameters of evaluation and the essentials of an effective
appraisal system.
Further the performance appraisal system of HDFC Bank, collected through
various primary and secondary sources have been included in the report which
gives a fair idea of the kind of appraisal system being followed across various
corporate.
Last, the conclusions and references have been mentioned.

Table of Content
Training Certificate

ii

Certificate from the College

iii

Acknowledgement

iv

Preface

Executive Summary

vii

1.

Introduction to the Topic

2.

Company Profile

36-61

3.

Research Methodology

62-65

4.

Limitations

66-67

5.

Data Interpretation & Analysis

68-90

6.

Findings

91-93

7.

SWOT Analysis

94-98

8.

Suggestion & Recommendations

9.

Conclusion

10. Bibliography
Annexure

1-35

99-100
101-102
103-104
105-109

Introduction to
the Topic

INTRODUCTION TO THE TOPIC

Definition of performance appraisal
Performance Appraisal is defined as the process of assessing the performance and
Progress of an employee or a group of employees on a given job and his / their
potential
for future development. It consists of all formal procedures used in working
organizations
and potential of employees. According to Flippo, Performance Appraisal is the
systematic, periodic and an important rating of an employees excellence in matters
pertaining to his present job and his potential for a better job.
According to Dulewicz (1989),
"... A basic human tendency to make judgements about those one is working with, as
well as about oneself."
Any system of determining how well an individual employee has performed during
a period of time, frequently used as a basis for determining merit increases.
Performance appraisal is a systematic review of a persons work and achievements
over a recent period, usually leading to plans for the future.
In its most basic form, performance appraisal (or review) activities include
documenting achieved results (hopefully, by also including use of examples to clarify
documentation) and indicating if standards were met or not. The appraisal usually
includes some form of a development plan to address insufficient performance.
2

In many organizations - but not all - appraisal results are used, either directly or
indirectly, to help determine reward outcomes. That is, the appraisal results are used
to identify the better performing employees who should get the majority of available
merit pay increases, bonuses, and promotions.

This concept have get the recognition the evaluation of work performance, appraisal
really dates from the time of the Second World War - not more than 60 years ago, as a
distinct and formal management procedure were used in the evaluation of the work
performance.

Later, the traditional emphasis on reward outcomes was progressively rejected as it

took only into consideration the material outcome but not the morale, enthusiasm,
attitude ability and self-esteem. In the 1950s in the United States, the potential
usefulness of appraisal as tool for motivation and development was gradually
recognized. The general model of performance appraisal, as it is known today, began
from that time.

Yearly performance reviews are critical. Organizations are hard pressed to find good
reasons why they can't dedicate an hour-long meeting once a year to ensure the
mutual needs of the employee and organization are being met. Performance reviews
help supervisors feel more honest in their relationships with their subordinates and
feel better about themselves in their supervisorial roles. Subordinates are assured clear
understanding of what's expected from them, their own personal strengths and areas
3

for development and a solid sense of their relationship with their supervisor. Avoiding
performance issues ultimately decreases morale, decreases credibility of management,
decreases the organization's overall effectiveness and wastes more of management's
time to do what isn't being done properly.
Few issues in management stir up more controversy than performance appraisal.
There are many reputable sources - researchers, management commentators, and
psychometricians - who have expressed doubts about the validity and reliability of the
performance appraisal process. Some have even suggested that the process is so
inherently flawed that it may be impossible to perfect it.

It is deemed as the critical tool for banking sector as for the banking sector the
performance indicators are quit different and the overall structure of the banking
sector is bit complex thus to use this concept effectively and efficiently is quit
difficult for this sector.

Thus, through this report the researcher had tried to find the problem emerging and to
provide them suggestion so as for effective working.

Techniques of performance Appraisal

1-Rating scale
2-Check list
3-Force distribution
4-Forced choice method
5-Critical incident method
6-Essay method
7-360 degree performance appraisal method
Characteristics
1. Performance Appraisal is a process.
2. It is the systematic examination of the strengths and weakness of an employee in
terms of his job.
3. It is scientific and objective study. Formal procedures are used in the study.
4. It is an ongoing and continuous process wherein the evaluations are arranged
periodically according to a definite plan.
5. The main purpose of Performance Appraisal is to secure information necessary
for making objective and correct decision of the employees.

CONCEPT OF PERFORMANCE APPRAISAL

Performance appraisal may be defined as a structured formal interaction between a
subordinate and supervisor, that usually takes the form of a periodic interview (annual
or semi-annual), in which the work performance of the subordinate is examined and
discussed, with a view to identifying weaknesses and strengths as well as
opportunities for improvement and skills development.

In many organizations - but not all - appraisal results are used, either directly or
indirectly, to help determine reward outcomes. That is, the appraisal results are used
to identify the better performing employees who should get the majority of available
merit pay increases, bonuses, and promotions.
By the same token, appraisal results are used to identify the poorer performers who
may require some form of counseling, or in extreme cases, demotion, dismissal or
decreases in pay. (Organizations need to be aware of laws in their country that might
restrict their capacity to dismiss employees or decrease pay.)

Whether this is an appropriate use of performance appraisal - the assignment and

justification of rewards and penalties - is a very uncertain and contentious matter.

Performance appraisals are essential for the effective management and evaluation of
staff. Appraisals help develop individuals, improve organizational performance, and
feed into business planning. Formal performance appraisals are generally conducted
annually for all staff in the organization. Each staff member is appraised by his or her
line manager (Directors are appraised by the CEO, who is appraised by the chairman
or company owners, depending on the size and structure of the organization). Annual

performance appraisals enable management and monitoring of standards, agreeing

expectations and objectives, and delegation of responsibilities and tasks. Staff
performance appraisals also establish individual training needs and enable
organizational training needs analysis and planning. Performance appraisals data
feeds into organizational annual pay and grading reviews, and coincides with the
business planning for the next trading year.
Performance appraisals generally review each individual's performance against
objectives and standards for the trading year, agreed at the previous appraisal meeting.
Performance appraisals are also essential for career and succession planning.
Performance appraisals are important for staff motivation, attitude and behavior
development, communicating organizational aims, and fostering positive relationships
between management and staff. Performance appraisals provide a formal, recorded,
regular review of an individual's performance, and a plan for future development.

INTRODUCTION TO HUMAN RESOURCE MANAGEMENT

Human Resource (or personnel) management, in the sense of getting things
done through people, is an essential part of every managers responsibility, 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 clich, which no member of any
senior management team would disagree with. Yet, the reality for many organizations
are that their people remain undervalued, under trained and underutilized.

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.

FUNCTIONS OF HUMAN RESOURCE MANAGEMENT

Following are the various functions of Human Resource Management that are
essential for the effective functioning of the organization:
1.

Recruitment

2.

Selection

3.

Induction

4.

Performance Appraisal

5.

Training & Development

RECRUITMENT
The process of recruitment begins after manpower requirements are determined in
terms of quality through job analysis and quantity through forecasting and planning.
SELECTION
The selection is the process of ascertaining whether or not candidates possess the
requisite qualifications, training and experience required.
INDUCTION
Induction is the technique by which a new employee is rehabilitated into the changed
surroundings and introduced to the practices, policies and purposes of the
organization.

WHAT IS PERFORMANCE APPRAISAL?

Performance Appraisal is defined as the process of assessing the performance
and progress of an employee or a group of employees on a given job and his / their
potential for future development. It consists of all formal procedures used in working
organizations and potential of employees. According to Flippo, Performance
Appraisal is the systematic, periodic and an important rating of an employees
excellence in matters pertaining to his present job and his potential for a better job.
CHARACTERISTICS
1. Performance Appraisal is a process.
2. It is the systematic examination of the strengths and weakness of an employee
in terms of his job.
3. It is scientific and objective study. Formal procedures are used in the study.
4. It is an ongoing and continuous process wherein the evaluations are arranged
periodically according to a definite plan.
5. The main purpose of Performance Appraisal is to secure information
necessary for making objective and correct decision an employee.
PROCESS
The process of performance appraisal:
9

1. Establishing performance standards

2. Communicating the Standards
3. Measuring Performance
4. Comparing the actual with the standards
5. Discussing the appraisal
6. 6.Taking Corrective Action
LIMITATIONS
1. Errors in Rating
2. Lack of reliability
3. Negative approach
4. Multiple objectives
5. Lack of knowledge
METHODS OF PERFORMANCE APPRAISAL
The foregoing list of major program pitfalls represents a formidable challenge,
even considering the available battery of appraisal techniques. But attempting to avoid
these pitfalls by doing away with appraisals themselves is like trying to solve the
problems of life by committing suicide. The more logical task is to identify those
appraisal practices that are (a) most likely to achieve a particular objective and (b)
least vulnerable to the obstacles already discussed.
Before relating the specific techniques to the goals of performance appraisal
stated at the outset of the article, I shall briefly review each, taking them more or less
in an order of increasing complexity. The best-known techniques will be treated most
briefly.
ESSAY APPRAISAL
In its simplest form, this technique asks the rater to write a paragraph or more
covering an individual's strengths, weaknesses, potential, and so on. In most selection

10

situations, particularly those involving professional, sales, or managerial positions,

essay appraisals from former employers, teachers, or associates carry significant
weight.

GRAPHIC RATING SCALE

This technique may not yield the depth of an essay appraisal, but it is more
consistent and reliable. Typically, a graphic scale assesses a person on the quality and
quantity of his work (is he outstanding, above average, average, or unsatisfactory?)
and on a variety of other factors that vary with the job but usually include personal
traits like reliability and cooperation. It may also include specific performance items
like oral and written communication.
FIELD REVIEW
The field review is one of several techniques for doing this. A member of the
personnel or central administrative staff meets with small groups of raters from each
supervisory unit and goes over each employee's rating with them to (a) identify areas
of inter-rater disagreement, (b) help the group arrive at a consensus, and (c) determine
that each rater conceives the standards similarly.
FORCED-CHOICE RATING
Like the field review, this technique was developed to reduce bias and
establish objective standards of comparison between individuals, but it does not
involve the intervention of a third party.

11

MANAGEMENT BY OBJECTIVES
To avoid, or to deal with, the feeling that they are being judged by unfairly
high standards, employees in some organizations are being asked to set - or help set their own performance goals. Within the past five or six years, MBO has become
something of a fad and is so familiar to most managers that I will not dwell on it here.
RANKING METHODS
For comparative purposes, particularly when it is necessary to compare people
who work for different supervisors, individual statements, ratings, or appraisal forms
are not particularly useful. Instead, it is necessary to recognize that comparisons
involve an overall subjective judgment to which a host of additional facts and
impressions must somehow be added. There is no single form or way to do this.
The best approach appears to be a ranking technique involving pooled judgment.
The two most effective methods are alternation ranking and paired comparison
ranking.

12

1.

Alternation ranking:

Ranking of employees from best to worst on a trait or traits is another method for
evaluating employees. Since it is usually easier to distinguish between the worst and
the best employees than to rank them, an alternation ranking method is most popular.
Here subordinates to be rated are listed and the names of those not well enough to
rank are crossed. Then on a form as shown below, the employee who is highest on the
characteristic being measured and the one who is the lowest are indicated. Then chose
the next highest and the next lowest, alternating between highest and lowest until all
the employees to be rated have been ranked.
2.

Paired-comparison ranking:
This technique is probably just as accurate as alternation ranking and might be

more so. But with large numbers of employees it becomes extremely time consuming
and cumbersome.
Both ranking techniques, particularly when combined with multiple rankings
(i.e., when two or more people are asked to make independent rankings of the same
work group and their lists are averaged), are among the best available for generating
valid order-of-merit rankings for salary administration purposes.
ASSESSMENT CENTERS
So far, we have been talking about assessing past performance. What about the
assessment of future performance or potential? In any placement decision and even
more so in promotion decisions, some prediction of future performance is necessary.
How can this kind of prediction be made most validly and most fairly?

13

360 DEGREE FEEDBACK

Many firms have expanded the idea of upward feedback into what the call
360-degree feedback. The feedback is generally used for training and development,
rather than for pay increases.
Most 360 Degree Feedback system contains several common features. Appropriate
parties peers, supervisors, subordinates and customers, for instance complete
survey, questionnaires on an individual. 360 degree feedback is also known as the
multi-rater feedback, whereby ratings are not given just by the next manager up in the
organizational hierarchy, but also by peers and subordinates. Appropriates customer
ratings are also included, along with the element of self appraisal. Once gathered in,
the assessment from the various quarters are compared with one another and the
results communicated to the manager concerned.
Another technique that is useful for coaching purposes is, of course, MBO. Like the
critical incident method, it focuses on actual behavior and actual
results, which can be discussed objectively and constructively, with little or no need
for a supervisor to "play God."
ADVANTAGES
Instead of assuming traits, the MBO method concentrates on actual outcomes.
If the employee meets or exceeds the set objectives, then he or she has demonstrated
an acceptable level of job performance. Employees are judged according to real
outcomes, and not on their potential for success, or on someone's subjective opinion
of their abilities.

14

The guiding principle of the MBO approach is that direct results can be observed
easily. The MBO method recognizes the fact that it is difficult to neatly dissect all the
complex and varied elements that go to make up employee performance.
MBO advocates claim that the performance of employees cannot be broken up into so
many constituent parts, but to put all the parts together and the performance may be
directly

observed

and

measured.

DISADVANTAGES
This approach can lead to unrealistic expectations about what can and cannot
be reasonably accomplished. Supervisors and subordinates must have very good
"Reality Checking" skills to use MBO appraisal methods. They will need these
skills during the initial stage of objective setting, and for the purposes of self-auditing
and self-monitoring.
Variable objectives may cause employee confusion. It is also possible that
fluid objectives may be distorted to disguise or justify failures in performance.

BENEFITS OF PERFORMANCE APPRAISALS

Measures an employees performance.

Helps in clarifying, defining, redefining priorities and objectives.

Motivates the employee through achievement and feedback.

Facilitates assessment and agreement of training needs.

Helps in identification of personal strengths and weaknesses.

15

Plays an important role in Personal career and succession planning.

Clarifies team roles and facilitates team building.

Plays major role in organizational training needs assessment and analysis.

Improves understanding and relationship between the employee and the

reporting

manager

and

also

helps

in

resolving

confusions

and

misunderstandings.

Plays an important tool for communicating the organizations philosophies,

values, aims, strategies, priorities, etc among its employees.

Helps in counseling and feedback.

RATING ERRORS IN PERFORMANCE APPRAISALS

Performance Appraisals are subject to a wide variety of inaccuracies and

biases referred to as 'rating errors'. These errors can seriously affect assessment
results. Some of the most common rating errors are: -

LENIENCY OR SEVERITY: - Leniency or severity on the part of the rater makes

the assessment subjective. Subjective assessment defeats the very purpose of
performance appraisal. Ratings are lenient for the following reasons:
a)

The rater may feel that anyone under his or her jurisdiction who is
rated unfavorably will reflect poorly on his or her own worthiness.

b)

He/She may feel that a derogatory rating will be revealed to the rate to
detriment the relations between the rater and the ratee.

16

c)

He/She may rate leniently in order to win promotions for the

subordinates and therefore, indirectly increase his/her hold over him.

CENTRAL TENDENCY: - This occurs when employees are incorrectly rated near
the average or middle of the scale. The attitude of the rater is to play safe. This safe
playing attitude stems from certain doubts and anxieties, which the raters have been
assessing the rates.

HALO ERROR: - A halo error takes place when one aspect of an individual's
performance influences the evaluation of the entire performance of the individual. The
halo error occurs when an employee who works late constantly might be rated high on
productivity and quality of output as well ax on motivation. Similarly, an attractive or
popular personality might be given a high overall rating. Rating employees separately
on each of the performance measures and encouraging raters to guard against the halo
effect are the two ways to reduce the halo effect.
RATER EFFECT: -This includes favoritism, stereotyping, and hostility. Extensively
high or low score are given only to certain individuals or groups based on the rater's
attitude towards them and not on actual outcomes or behaviors; sex, age, race and
friendship biases are examples of this type of error.

PRIMACY AND REGENCY EFFECTS: - The rater's rating is heavily influenced

either by behavior exhibited by the ratee during his early stage of the review period
(primacy) or by the outcomes, or behavior exhibited by the ratee near the end of the
review period (regency). For example, if a salesperson captures an important
17

contract/sale just before the completion of the appraisal, the timing of the incident
may inflate his or her standing, even though the overall performance of the sales
person may not have been encouraging. One way of guarding against such an error is
to ask the rater to consider the composite performance of the rate and not to be
influenced by one incident or an achievement.

PERFORMANCE DIMENSION ORDER: - Two or more dimensions on a

performance instrument follow each other and both describe or rotate to a similar
quality. The rater rates the first dimensions accurately and then rates the second
dimension to the first because of the proximity. If the dimensions had been arranged
in a significantly different order, the ratings might have been different.
SPILLOVER EFFECT: - This refers lo allowing past performance appraisal rating
lo unjustifiably influence current ratings. Past ratings, good or bad, result in similar
rating for current period although the demonstrated behavior docs not deserve the
rating, good or bad.
ROLES IN THE PERFORMANCE APPRAISAL PROCESS
a) REPORTING MANAGER

Provide feedback to the reviewer / HOD on the employees behavioral

traits indicated in the PMS Policy Manual

Ensures that employee is aware of the normalization / performance

appraisal process

18

Address employee concerns / queries on performance rating, in

consultation with the reviewer

b) REVIEWER (Reporting Managers reporting Manager)

Discuss with the reporting managers on the behavioral traits of all the
employees for whom he / she is the reviewer

Where required, independently assess employees for the said behavioral

traits; such assessments might require collecting data directly from other
relevant employees

c)

HOD (In some cases, a reviewer may not be a HOD)

Presents the proposed Performance Rating for every employee of his /

her function to the Normalization committee.

HOD also plays the role of a normalization committee member.

d) HR HEAD

Secretary to the normalization committee

Assists HODs / Reporting Managers in communicating the
performance rating of all the employees

e) NORMALIZATION COMMITTEE

Decides on the final bell curve for each function in the respective
Business Unit / Circle
19

Reviews the performance ratings proposed by the HODs,

specifically on the upward / downward shift in ratings, to ensure an

unbiased relative ranking of employees on overall performance,
and thus finalize the performance rating of each employee

KEY CONCEPTS IN PMS

In order to understand the Performance Management System, some concepts need
to be explained which play a very important role in using the PMS successfully. They
are:

KRAS (KEY RESULT AREAS): The performance of an employee is

largely dependent on the KRA score achieved by the employee during that
particular year. Thus, it is necessary to answer a few basic questions i.e.
What are the guidelines for setting the KRAs for an employee?
How does an employee write down his KRAs for a particular financial
year?
KRAs: The Four Perspectives.
How is the KRA score calculated for an employee on the basis of the
targets sets and targets achieved?

BEHAVIORAL TRAITS: Some of the qualitative aspects of an

employees performance combined with the general behavioral traits displayed
by the employee during a year constitutes his behavior traits. An employee is
assigned the rating on the basis of the intensity

20

of the behavior displayed by him. They play a very important role in the deciding the
final performance rating for an employee as is even capable of shifting the rating one
level upwards/downwards.

BHARTI 2010 LEADERSHIP COMPETENCY FRAMEWORK: This

competency framework is a simple and structured way to describe the elements of
behaviors required to perform a role effectively. This framework also tries to
assess the performance of an employee objectively.

THE PERFORMANCE RATING PROCESS: The rating process tries to explain

the four different types of rating that an employee can achieve i.e. EC, SC, C and
PC. It also explains the criteria, which is considered for awarding any of these
ratings to the employee.

PROMOTION AND RATING DISRTRIBUTION GUIDELINES: The

promotion and normal distribution guidelines provide the framework within which
the performance appraisal process has to work. It is very important that the HR
department pays due attention to these guidelines while preparing the bell curves
for various functions and the consolidated bell curve for all the functions. These
guidelines also help in deciding upon the promotion cases in a year.

21

PERFORMANCE RATING PROCESS

EXCEPTIONAL CONTRIBUTOR (EC)
Performs

SIGNIFICANT

and (SC)

consistently

substantially above expectations in all

Performs above expectations in all

areas

areas

Achieves a final score greater than or

Achieves final score between 100-

equal to 115%
Consistently

114%
delivers

on

stretch

Versatile in his/ her area of

targets

operation
Develops creative solutions and

Is proactive
Spots

CONTRIBUTOR

require little / minimal supervision

and

anticipates

problems,

implements solutions

Sets examples for others

Take

Sees and exploits opportunities

Delivers ahead of time
Sees the wider picture-impacts across
business
Focuses on whats good for the
business

ownership

of

own

development
Coaches others
Demonstrates business initiative
Is self motivated
Supportive team player
Leads own team very effectively
Demonstrate functional initiative

Seen as role model by others

Recognized as exceptional by other

functions as well
Motivates others to solve problems
Develops others
Provides open and honest

22

Human Resource (or personnel) management, in the sense of getting things

done through people, is an essential part of every managers responsibility, 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 clich, which no member of any
senior management team would disagree with. Yet, the reality for many organizations
are that their people remain under valued, under trained and under utilized.
Following are the various functions of Human Resource Management that are
essential for the effective functioning of the organization:
1.

Recruitment

2.

Selection

3.

Induction

4.

Performance Appraisal

5.

Training & Development

Performance appraisal is necessary to measure the performance of the employees and

the organization to check the progress towards the desired goals and aims.
The latest mantra being followed by organizations across the world being
"get paid according to what you contribute" the focus of the organizations is
turning to performance management and specifically to individual performance.
Performance appraisal helps to rate the performance of the employees and evaluate

23

their contribution towards the organizational goals. If the process of performance

appraisals is formal and properly structured, it helps the employees to clearly
understand their roles and responsibilities and give direction to the individuals
performance. It helps to align the individual performances with the organizational
goals and also review their performance.

Performance appraisal takes into account the past performance of the

employees and focuses on the improvement of the future performance of the
employees.

PART OF SELF APPRAISAL

Performance appraisal feedback
Performance Review - Preparation
Performance

Consulting:

Moving

Performance Review The Meeting

Beyond Training

How to Complete a Performance

Writing performance appraisal

Appraisal Form
Performance Appraisal Training
Analysis for Improving Performance
How
Active

performance

appraisal

to

Measure

Employee

Performance

conversation

24

SELF APPRAISAL
Self appraisal is an important part of the Performance appraisal process where the
employee himself gives the feedback or his views and points regarding his
performance. Usually this is done with the help of a self appraisal form where the
employee rates himself on various parameters, tells about his training needs, if any,
talks about his accomplishments, strengths, weaknesses, problems faced etc.
TIPS FOR SELF APPRAISAL
BE HONEST
Always be truthful and honest while telling your accomplishments or failures.
Dont exaggerate your strengths and dont hide your weaknesses. Dont make
personal judgments for anybody.
DO THE PREPARATION
Its always better to prepare yourself before the meeting. Get all the lists in
place; prepare all the evidences and references.

BE OBJECTIVE
Objectivity is important in self appraisal. Dont exaggerate or downplay your
achievements or failures. Be specific and concise in your statements and if
possible support them with examples or references or evidences with dates. For
example: "I responded to all queries within 48 hours" is better than just saying
"My customer service was good."

POSITIVE ATTITUDE

Have a positive attitude towards the whole appraisal process. Be co-operative.

Dont hesitate from taking the responsibility of your failures as well as the
25

achievements. Demonstrate enthusiasm to improve in future and take all his

suggestions calmly. Dont complain or demonstrate a negative attitude.

Cover all the aspects

Apart from your strengths, weaknesses, accomplishments and failures, express

the opportunities you would like have for your development and improvement.
Suggest ways to overcome the problems faced. Assess your capabilities,
behaviors and skills and competence.

SEEK FUTURE RESPONSIBILITIES

According to the assessment of the KSAs according to your job description,
plan the short term and long term for the next year. Try to look for tasks beyond your
current job responsibilities. This will help in personal development as well as
contributing to the organizational productivity.

Self appraisal should ideally include the accomplishments, the goals achieved,
the failures, and the personal growth (i.e. new skills acquired, preparation for the
future etc.), the obstacles faced during the period, the efforts for removing them, the
suggestions, and the areas of training and development felt by the employee.
PERFORMANCE APPRAISAL FEEDBACK

Performance appraisal process is incomplete without the feedback given to the

employee about his appraisal and his performance. But the way of giving as well as
receiving the feedback differs from person to person and their way of handling and
their outlook towards the issue.

According to a popular saying:

26

"A SUCCESSFUL MAN IS ONE WHO CAN LAY A FIRM FOUNDATION

WITH THE BRICKS OTHERS HAVE THROWN AT HIM."
Therefore, On the part of the person receiving the feedback, the following points are
important to be taken care of:

The employee should have a positive attitude towards the feedback process

He should listen to the suggestions of the appraiser calmly and try to

incorporate them in his plans.

He should not hesitate to ask for the help of his superiors.

Should have a co-operative attitude during the feedback meeting.

Dont judge the appraiser as a person.

Should take the feedback objectively.

Should not judge the appraiser as a person on the basis of the feedback.

On the part of the appraiser or the manager / person giving the feedback, the
following points are to be taken care of:

The appraiser should make the receiver feel comfortable during the feedback
meeting.

The appraiser should make it a two way conversation i.e. let the employee
speak.

Listen to the employee and note his points, suggestions, problems etc.

27

The appraiser should not adopt a confrontational approach towards the meeting.
The goal is not to criticize the employee.

Provide a constructive feedback to the employee i.e. in a way which will

motivate him to perform better.

Have a positive attitude towards the process

Try to understand the reasons of his failure.

Make the appraisal feedback meeting useful and productive for the organization and
the employee.

PERFORMANCE REVIEW MEETING

Today, Performance Review Meetings are regarded as conversation with a

purpose. They are considered extremely important for the development and health of
the organization. The purpose of the performance review meetings is to reach
mutually agreed conclusions about the development of the individual and his
performance and if applicable, any areas for improvement, including how such
improvements are to be achieved.

The purpose of Performance and Development reviews is to enable the

employees to engage in a dialogue and get the support of the manager about the
individuals performance and development. They should be more like free- flowing,
open meetings in which views are exchanged so that agreed conclusions can be
reached. The three key elements of performance review meetings are:

1. Feedback - Providing information on how a person has been doing.

2. Measurement assessing results against agreed targets and standards.
28

3. Exchange of views - Ensuring that the discussion involves a full, free and
frank exchange of views about what has been achieved, what needs to be done
to achieve more and what employees think about their work the way they are
managed and their aspirations.
Performance Appraisal review is the meeting when the employee can be
motivated to perform better in future or reinforce his desirable behaviour. Review
discussion meetings ideally should include the following:

Review of progress on tasks and activities in relation to the employees

performance plan,

The developmental initiatives taken by the employee himself and those

planned by the management for the employee.

Identification of variances in terms of delays, requisite quality and shortfall in

help planned for the employee, if any

Analyzing the causes of the delay, the problems faced and the solutions
adopted.

Preparation of action steps for solving identified problems and contingency

plans for anticipated problems.

Periodic review meetings become meaningful only when they help pause, reflect, take
stock and strategize in an otherwise active relationship.

29

How to Complete Performance Appraisal Form

Performance Appraisal form provides the basis for the performance review,
providing the feedback to the employees and the final rating of the employee. It also
facilitates various other HR decisions and career development plans and decisions of
the employees. Therefore, performance appraisal from should be filled with utmost
care

and

objectivity.

The Performance appraisal form should be filled by the immediate supervisor or

manager of the employee in order to ensure that the appraiser if fully acquainted with
the performance, responsibilities, targets and standards of the employee. All the
instructions and guidelines on the appraisal form should be read and followed
carefully.

Be prepared with all the details of the performance, the standards, job
description and the past appraisals of the employee.

Clear and unambiguous description of the employee performance should be

given in terms of average, above average, good and excellent performance.

The focus should be on the employees behaviour throughout the year and not
just his recent performance.

Quantify the ratings, wherever possible, to ensure easy comparability.

Substantiate and support your rating, and attach all the necessary documents
(if required).

30

Apart from the defined performance objectives and results, discuss the related
issues as well covering all the aspects of the performance.

When filling the appraisal form, be honest and objective.

ANALYSIS FOR IMPROVING PERFORMANCE

Any performance review process is incomplete without the feedback to the

employees. The feedback could be given in the review discussion. Review discussions
are semi formal, scheduled, periodic interactions usually bimonthly or quarterly
between a manager and his employee. The basic purpose of the review discussion is
to analyze the performance of the employee in the past to improve the performance
of the employee in future.

A review discussion is an opportunity to coach, mentor, learn and understand.

The manager encourages his/her employees to critically reflect over progress made on
the Performance appraisal plan and to develop creative, yet feasible alternatives for
problem areas.The manager uses this opportunity to:

Review the performance of the each employee individually.

Discuss the problems faced by the employees during the course of action.

The solutions tried, and the degree of success achieved in solving the
problems faced.

Revisit with the employee, his/ her annual plan for the remaining time period
and develop revised action plans, if necessary.

Review discussions reassure the employees that each one of them has
structured opportunities for one to one interaction with the manager once every two or
31

three months during the year. These opportunities are important as they provide an
important chance for performance monitoring or development mentoring. The aim of
the performance review discussions is to share perceptions, solve the problem faced
during the course of the action, decide on the new goals jointly and provide a
feedback to the employee for the past performance i.e. to look at his strengths and
weaknesses and also help to chart out a career plan for the employee. The focus of
these performance review discussions should not bet o judge the employees past
performance; rather it should be to motivate the employee to improve his future
performance and reinforce his good behaviour.

Active Performance Appraisal Conversation

1. Active conversation plays an important part in the performance review

meeting. The appraiser should ensure that the meeting has a two way
conversation and that the employee should get a fair chance

To speak. The "manner" of giving the feedback of the performance of the

employee is very important. The conversation should have an optimistic and
motivating tone.

Some important points that should be taken care of in the active

Performance Appraisal Conversation are:

Make it a two-way conversation. An effective Performance appraisal review

requires an interactive discussion with an open agenda. Try to formulate
questions that seek the employees ideas and input. This will help the
employee feel you value his or her opinions. Give the employee a fair
chance to put forward his ideas; let him speak.
32

2. Be a good listener. Remember to be an active listener and to pick up on your

employees verbal and nonverbal cues. Listen to his ideas and problems.
3. Address whats important to the employee. Since job satisfaction is the most
important factor affecting an employees attitude (and therefore his or her
level of performance and value to your company), an effective review
should delve into areas that include issues most important to that employee.
4. Lead with the positive. Its important to reaffirm the employees strengths at
the beginning of the review. Since job security is the number one concern of
most people, the performance review is a good time to tell an employee how
much you value their contributions to your business.
5. Dont be confrontational. Its important not to criticize the employee in
general terms. The goal is to evaluate job performance and not the person. A
performance review that turns into a gripe session misses the opportunity to
raise employee morale.
6. Positive reinforcement emphasizing what has been done well so that it will
be done even better in the future and making only constructive criticisms
(i.e. those that point the way to improvement).
7. Exchange of views - Ensuring that the discussion involves a full, free and
frank exchange of views about what has been achieved, what needs to be
done to achieve more and what the appraiser think about their work the way
they are managed and their aspirations.

Agreement - jointly coming to an understanding about what has to be done by both

parties to improve performance, knowledge and skills and overcome any work
problems raised during the discussion
33

Performance Appraisal Feedback

Performance appraisal process is incomplete without the feedback given to the
employee about his appraisal and his performance. But the way of giving as well as
receiving the feedback differs from person to person and their way of handling and
their outlook towards the issue.

According to a popular saying:

"A SUCCESSFUL MAN IS ONE WHO CAN LAY A FIRM FOUNDATION
WITH THE BRICKS OTHERS HAVE THROWN AT HIM."

Therefore, On the part of the person receiving the feedback, the following points are
important to be taken care of:

The employee should have a positive attitude towards the feedback process

He should listen to the suggestions of the appraiser calmly and try to

incorporate them in his plans.

He should not hesitate to ask for the help of his superiors.

Should have a co-operative attitude during the feedback meeting.

Dont judge the appraiser as a person.

Should take the feedback objectively.

Should not judge the appraiser as a person on the basis of the feedback.

On the part of the appraiser or the manager / person giving the feedback, the
following points are to be taken care of:

34

The appraiser should make the receiver feel comfortable during the feedback
meeting.

The appraiser should make it a two way conversation i.e. let the employee
speak.

Listen to the employee and note his points, suggestions, problems etc.

The appraiser should not adopt a confrontational approach towards the

meeting. The goal is not to criticize the employee.

Provide a constructive feedback to the employee i.e. in a way which will

motivate him to perform better.

Have a positive attitude towards the process

Try to understand the reasons of his failure.

Be fair and objective

Prepare yourself for what to say and how to say.

35

Company
Profile

36

Company Profile
HDFC Bank

Type

Public
BSE: 500180
NSE: HDFCBANK

Traded as

NYSE: HDB
BSE SENSEX Constituent
CNX Nifty Constituent

Industry

Banking, Financial services

Founded

August 1994

Headquarters

Mumbai, Maharashtra, India

Area served

Worldwide

Key people

Aditya Puri (MD)

Investment Banking
Investment Management

Products

Wealth Management
Private Banking
Corporate Banking
Private Equity

37

Finance and Insurance

Consumer Banking
Mortgages
Credit Cards

Revenue

743.7322 billion (US$11 billion) (2016)

Profit

128.1733 billion (US$1.9 billion) (2016)

Total assets

6.87892 trillion (US$100 billion) (2015)

Total equity

5.0564 billion (US$75 million)

Number of employees
Website

76,286 (March 2015)

HDFCBank.com

HDFC Bank is an Indian banking and financial services company headquartered in

Mumbai, Maharashtra. It has about 76,286 employees including 12,680 women and
has a presence in Bahrain, Hong Kong and Dubai. HDFC Bank is the second largest
private bank in India as measured by assets. It is the largest bank in India by market
capitalization as of February 2016. It was ranked 58th among Indias most trusted
brands according to Brand Trust Report, 2015.

38

FORMATION OF THE COMPANY

The Housing Development Finance Corporation Limited (HDFC) was amongst the
first to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set
up a bank in the private sector, as part of the RBI's liberalization of the Indian
Banking Industry in 1994. The bank was incorporated in August 1994 in the name of
'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank
commenced operations as a Scheduled Commercial Bank in January 1995.

PROMOTER
HDFC is India's premier housing finance company and enjoys an impeccable track
record in India as well as in international markets. Since its inception in 1977, the
Corporation has maintained a consistent and healthy growth in its operations to
remain the market leader in mortgages. Its outstanding loan portfolio covers well over
a million dwelling units. HDFC has developed significant expertise in retail mortgage
loans to different market segments and also has a large corporate client base for its
housing related credit facilities. With its experience in the financial markets, a strong
market reputation, large shareholder base and unique consumer franchise, HDFC was
ideally positioned to promote a bank in the Indian environment.

39

BUSINESS FOCUS

HDFC Bank's mission is to be a World-Class Indian Bank. The objective is to build

sound customer franchises across distinct businesses so as to be the preferred provider
of banking services for target retail and wholesale customer segments, and to achieve
healthy growth in profitability, consistent with the bank's risk appetite. The bank is
committed to maintain the highest level of ethical standards, professional integrity,
corporate governance and regulatory compliance. HDFC Bank's business philosophy
is based on four core values Operational Excellence, Customer Focus, Product
Leadership and People.

CAPITAL STRUCTURE
As on 31st March, 2009 the authorised share capital of HDFC Bank is Rs. 550 crore.
The paid-up capital as on the said date is Rs. 425,38,41,090/- ( 42,53,84,109 equity
shares of Rs 10/- each). The HDFC Group holds 19.38% of the Bank's equity and
about 17.70 % of the equity is held by the ADS Depository (in respect of the bank's
American Depository Shares (ADS) Issue). 27.69 % of the equity is held by Foreign
Institutional Investors (FIIs) and the Bank has about 5,48,774 shareholders.

The shares are listed on the Bombay Stock Exchange Limited and The National Stock
Exchange of India Limited. The Bank's American Depository Shares ( ADS ) are
listed on the New York Stock Exchange (NYSE) under the symbol 'HDB' and the
Bank's Global Depository Receipts (GDRs) are listed on Luxembourg Stock
Exchange under ISIN No US40415F2002.
40

TIMES BANK AMALGAMATION

In a milestone transaction in the Indian banking industry, Times Bank Limited
(another new private sector bank promoted by Bennett, Coleman & Co./Times Group)
was merged with HDFC Bank Ltd., effective February 26, 2000. As per the scheme of
amalgamation approved by the shareholders of both banks and the Reserve Bank of
India, shareholders of Times Bank received 1 share of HDFC Bank for every 5.75
shares of Times Bank. The acquisition added significant value to HDFC Bank in
terms of increased branch network, expanded geographic reach, enhanced customer
base, skilled manpower and the opportunity to cross-sell and leverage alternative
delivery channels.

DISTRIBUTION NETWORK
HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable
network of over 1229 branches spread over 444 cities across India. All branches are
linked on an online real-time basis. Customers in over 120 locations are also serviced
through Telephone Banking. The Bank's expansion plans take into account the need to
have a presence in all major industrial and commercial centers where its corporate
customers are located as well as the need to build a strong retail customer base for
both deposits and loan products. Being a clearing/settlement bank to various leading
stock exchanges, the Bank has branches in the centers where the NSE/BSE has a
strong and active member base. The Bank also has a network of about over 2526
networked ATMs across these cities. Moreover, HDFC Bank's ATM network can be
accessed by all domestic and international Visa/MasterCard, Visa Electron/Maestro,
Plus/Cirrus and American Express Credit/Charge cardholders.
41

BOARD OF DIRECTORS

The Composition of the Board of Directors of the Bank is governed by the Companies
Act, 1956, the Banking Regulation Act, 1949 and the listing requirements of the
Indian Stock Exchanges where securities issued by the Bank are listed. The Board has
strength of 12 Directors as on March 31, 2008. All Directors other than Mr. Aditya
Puri, Mr. Harish Engineer and Mr. Paresh Sukthankar are non-executive directors.
The Bank has five independent directors and six non-independent directors. The
Board consists of eminent persons with considerable professional expertise and
experience in banking, finance, agriculture, small scale industries and other related
fields.

None of the Directors on the Board is a member of more than 10 Committees and
Chairman of more than 5 Committees across all the companies in which he/she is a
Director. All the Directors have made necessary disclosures regarding Committee
positions occupied by them in other companies.

Mr. Jagdish Capoor, Mr. Keki Mistry, Mrs. Renu Karnad, Mr. Aditya Puri, Mr.
Harish Engineer and Mr. Paresh Sukthankar are non-independent Directors on the
Board.

Mr. Arvind Pande, Mr. Ashim Samanta, Mr. Gautam Divan, Mr. C. M. Vasudev
and Dr. Pandit Palande are independent directors on the Board.

Mr. Keki Mistry and Mrs. Renu Karnad represent HDFC Limited on the Board of
the Bank.

42

The Bank has not entered into any materially significant transactions during the
year, which could have a potential conflict of interest between the Bank and its
promoters, directors, management and/or their relatives, etc. other than the
transactions entered into in the normal course of business. The Senior Management
have made disclosures to the Board confirming that there are no material, financial
and/or commercial transactions between them and the Bank which could have
potential conflict of interest with the Bank at large.

TECHNOLOGY
HDFC Bank operates in a highly automated environment in terms of information
technology and communication systems. All the bank's branches have online
connectivity, which enables the bank to offer speedy funds transfer facilities to its
customers. Multi-branch access is also provided to retail customers through the
branch network and Automated Teller Machines (ATMs).
The Bank has made substantial efforts and investments in acquiring the best
technology available internationally, to build the infrastructure for a world class bank.
The Bank's business is supported by scalable and robust systems which ensure that
our clients always get the finest services we offer.
The Bank has prioritized its engagement in technology and the internet as one of its
key goals and has already made significant progress in web-enabling its core
businesses. In each of its businesses, the Bank has succeeded in leveraging its market
position, expertise and technology to create a competitive advantage and build market
share.

43

RATING
Credit rating
The Bank has its deposit programs rated by two rating agencies - Credit Analysis &
Research Limited (CARE) and Fitch Ratings India Private Limited. The Bank's Fixed
Deposit programme has been rated 'CARE AAA (FD)' [Triple A] by CARE, which
represents instruments considered to be "of the best quality, carrying negligible
investment risk". CARE has also rated the bank's Certificate of Deposit (CD)
programme "PR 1+" which represents "superior capacity for repayment of short term
promissory obligations". Fitch Ratings India Pvt. Ltd. (100% subsidiary of Fitch Inc.)
has assigned the "tAAA ( ind )" rating to the Bank's deposit programme, with the
outlook on the rating as "stable". This rating indicates "highest credit quality" where
"protection factors are very high".

The Bank also has its long term unsecured, subordinated (Tier II) Bonds rated by
CARE and Fitch Ratings India Private Limited and its Tier I perpetual Bonds and
Upper Tier II Bonds rated by CARE and CRISIL Ltd. CARE has assigned the rating
of "CARE AAA" for the subordinated Tier II Bonds while Fitch Ratings India Pvt.
Ltd. has assigned the rating "AAA (ind)" with the outlook on the rating as "stable".
CARE has also assigned "CARE AAA [Triple A]" for the Banks Perpetual bond and
Upper Tier II bond issues. CRISIL has assigned the rating "AAAStable" for the
Bank's Perpetual Debt programme and Upper Tier II Bond issue. In each of the cases
referred to above, the ratings awarded were the highest assigned by the rating agency
for those instruments?

44

Corporate governance rating

The bank was one of the first four companies, which subjected itself to a Corporate
Governance and Value Creation (GVC) rating by the rating agency, The Credit Rating
Information Services of India Limited (CRISIL). The rating provides an independent
assessment of an entity's current performance and an expectation on its "balanced
value creation and corporate governance practices" in future. The bank has been
assigned a 'CRISIL GVC Level 1' rating which indicates that the bank's capability
with respect to wealth creation for all its stakeholders while adopting sound corporate
governance practices is the highest.

PRODUCT SCOPE
HDFC Bank offers a bunch of products and services to meet the every need of the
people. The company cares for both, individuals as well as corporate and small and
medium enterprises. For individuals, the company has a range accounts, investment,
and pension scheme, different types of loans and cards that assist the customers. The
customers can choose the suitable one from a range of products which will suit their
life-stage and needs.
For organizations the company has a host of customized solutions that range from
Funded services, Non-funded services, Value addition services, Mutual fund etc.
These affordable plans apart from providing long term value to the employees help in
enhancing goodwill of the company.

45

The products of the company are categorized into various sections which are as
follows:

Accounts and deposits.

Loans.

Investments and Insurance.

Forex and payment services.

Cards.

Customer center.

BUSINESS SEGMENTS
HDFC Bank offers a wide range of commercial and transactional banking services
and treasury products to wholesale and retail customers. The bank has three key
business segments:
(i) Wholesale Banking Services

The Bank's target market ranges from large, blue-chip manufacturing companies in
the Indian corporate to small & mid-sized corporate and agro-based businesses. For
these customers, the Bank provides a wide range of commercial and transactional
banking services, including working capital finance, trade services, transactional
services, cash management, etc. The bank is also a leading provider of structured
solutions, which combine cash management services with vendor and distributor
finance for facilitating superior supply chain management for its corporate customers.
Based on its superior product delivery / service levels and strong customer

46

orientation, the Bank has made significant inroads into the banking consortia of a
number of leading Indian corporates including multinationals, companies from the
domestic business houses and prime public sector companies. It is recognized as a
leading provider of cash management and transactional banking solutions to corporate
customers, mutual funds, stock exchange members and banks.

(ii) Retail Banking Services

The objective of the Retail Bank is to provide its target market customers a full range
of financial products and banking services, giving the customer a one-stop window
for all his/her banking requirements. The products are backed by world-class service
and delivered to the customers through the growing branch network, as well as
through alternative delivery channels like ATMs, Phone Banking, Net Banking and
Mobile Banking.

The HDFC Bank Preferred program for high net worth individuals, the HDFC Bank
Plus and the Investment Advisory Services programs have been designed keeping in
mind needs of customers who seek distinct financial solutions, information and advice
on various investment avenues. The Bank also has a wide array of retail loan products
including Auto Loans, Loans against marketable securities, Personal Loans and Loans
for Two-wheelers. It is also a leading provider of Depository Participant (DP) services
for retail customers, providing customers the facility to hold their investments in
electronic form.

47

HDFC Bank was the first bank in India to launch an International Debit Card in
association with VISA (VISA Electron) and issues the MasterCard Maestro debit card
as well. The Bank launched its credit card business in late 2001. By September 30,
2005, the bank had a total card base (debit and credit cards) of 5.2 million cards. The
Bank is also one of the leading players in the "merchant acquiring" business with over
50,000 Point-of-sale (POS) terminals for debit / credit cards acceptance at merchant
establishments.

(iii) Treasury
Within this business, the bank has three main product areas - Foreign Exchange and
Derivatives, Local Currency Money Market & Debt Securities, and Equities. With the
liberalization of the financial markets in India, corporates need more sophisticated
risk management information, advice and product structures. These and fine pricing
on various treasury products are provided through the bank's Treasury team. To
comply with statutory reserve requirements, the bank is required to hold 25% of its
deposits in government securities. The Treasury business is responsible for managing
the returns and market risk on this investment portfolio.

48

The following tables summarizes the products and services and customer segments
offered by HDFC Bank:.
Table 1: Personal banking

Loan Product

Investment &
Deposit Product
Insurance

Auto Loan

Saving a/c

Mutual Fund

Loan Against Security

Current a/c

Bonds

Loan Against Property

Fixed deposit

Knowledge Centre

Personal loan

Demat a/c

Insurance

Credit card

Safe Deposit Lockers

General and Health

2-wheeler loan

Commercial vehicles finance

Equity and Derivatives

Home loans

Mudra Gold Bar

Retail business banking

Tractor loan

Working Capital Finance

Construction Equipment Finance

Health Care Finance

Education Loan

Gold Loan

Insurance

49

Cards

Payment Services

Access To Bank

Credit Card

NetSafe

NetBanking

Debit Card

Merchant

OneView

Prepaid Card

Prepaid Refill

InstaAlert

Billpay

Visa Billpay

ATM

InstaPay

Phone Banking

DirectPay

Email Statements

VisaMoney Transfer

Branch Network

eMonies Electronic

-------------------------------Forex Services

MobileBanking

Funds Transfer
-------------------------------

Product & Services

Trade Services

Forex service Branch Locater

RBI Guidelines

Online Payment of
Direct Tax

Source: http://www.hdfcbank.com/personal/prd_glance.htm

50

Table 2: Wholesale banking

Corporate

Large Corporates

Funded Services

Non
Services

Value
Services

Small and Medium

Government

Financial Institutions

Enterprises

Sector

and Trusts

Funded Services
Non

Internet Banking

Financial Institutions

Mutual Funds

Booking of L/Cs

Stock Brokers

Funded
E- Ticketing

Services

Funded
Specialized Services
Value
Added
services

Tax Collection

Collection

of
Insurance

added Stamp Duty

Internet Banking

Disbursement

Companies
of
Commodities

Pension

Electronic

Business

Trusts

Collection of fees

Supply

Chain

Collection

of

property tax

Partners

Dealer Financing

Vendor Financing

Agricultural
Lending
Source : http://www.hdfcbank.com/wholesale/prd_glance.htm

51

Table 3: NRI services

Accounts

&

Deposits

Remittances

Rupee Saving a/c

North America

Rupee Current a/c

UK

Rupee Fixed Deposits

Europe

Foreign Currency Deposits

Accounts for Returning

Middle East

Indians

Africa

Others

South East Asia

Quick remit
IndiaLink
Cheque LockBox
Telegraphic/ Wire Transfer
Funds Transfer Cheques/DDs/TCs

Investment & Insurances

Loans

Mutual Funds

Home Loans

Private Banking

Loans Against Securities

Portfolio Investment Scheme

Loans Against Deposits

52

Gold Credit Card

Payment Services
Access To Bank

NetSafe

NetBanking

BillPay

OneView

InstaPay

InstaAlert

DirectPay

ATM

Visa Money

PhoneBanking

Online Donation

Email Statements

Branch Network

Source: http://www.hdfcbank.com/nri/prd_glance.htm

BUSINESS STRATEGY
HDFC BANK

mission is to be "a World Class Indian Bank", benchmarking

themselves against

international standards and best practices in terms of product

offerings, technology, service levels, risk management and audit & compliance. The
objective is to build sound customer franchises across distinct businesses so as to be a
preferred provider of banking services for target retail and wholesale customer
segments, and to achieve a healthy growth in profitability, consistent with the Bank's
risk appetite. Bank is committed to do this while ensuring the highest levels of ethical

53

standards, professional integrity, corporate governance and regulatory compliance.

Continue to develop new product and technology is the main business strategy of the
bank. Maintain good relation with the customers is the main and prime objective of
the bank.

HDFC BANK business strategy emphasizes the following:

Increase market share in Indias expanding banking and financial services industry by
following a disciplined growth strategy focusing on quality and not on quantity and
delivering high quality customer service.

Leverage our technology platform and open scaleable systems to deliver more
products to more customers and to control operating costs.

Maintain current high standards for asset quality through disciplined credit risk
management.

Develop innovative products and services that attract the targeted customers and
address inefficiencies in the Indian financial sector.

Continue to develop products and services that reduce banks cost of funds.

Focus on high earnings growth with low volatility.

54

RECENT DEVELOPMENT
The Reserve Bank of India had approved the scheme of amalgamation of Centurion
Bank of Punjab Ltd. with HDFC Bank Ltd. with effect from May 23, 2008. All the
branches of Centurion Bank of Punjab will function as branches of HDFC Bank with
effect from May 23, 2008. With RBIs approval, all requisite statutory and regulatory
approvals for the merger have been obtained.
The combined entity would have a nationwide network of 1167 branches; a strong
deposit base of around Rs.1,22,000 crores and net advances of around Rs.89,000
crores. The balance sheet size of the combined entity would be over Rs.1, 63,000
crores.

On March 27, 2008, the shareholders of the Bank accorded their consent to a scheme
of amalgamation of Centurion Bank of Punjab Limited with HDFC Bank Limited.
The shareholders of the Bank approved the issuance of one equity share of Rs.10/each of HDFC Bank Limited for every 29 equity shares of Re. 1/- each held in
Centurion Bank of Punjab Limited. This is subject to receipt of Approvals from the
Reserve Bank of India, stock exchanges and other requisite statutory and regulatory
authorities. The shareholders also accorded their consent to issue equity shares
and/or warrants convertible into equity shares at the rate of Rs.1,530.13 each to
HDFC Limited and/or other promoter group companies on preferential basis, subject
to final regulatory approvals in this regard. The Shareholders of the Bank have also
approved an increase

in the authorized capital from Rs.450 crores to Rs.550

crores.

55

Promoted in 1995 by Housing Development Finance Corporation (HDFC), India's

leading housing finance company, HDFC Bank is one of India's premier banks
providing a wide range of financial products and services to its over 11 million
customers across hundreds of Indian cities using multiple distribution channels
including a pan-India network of branches, ATMs, phone banking, net banking and
mobile banking. Within a relatively short span of time, the bank has emerged as a
leading player in retail banking, wholesale banking, and treasury operations, its three
principal business segments. The bank's competitive strength clearly lies in the use of
technology and the ability to deliver world-class service with rapid response time.
Over the last 13 years, the bank has successfully gained market share in its

target

customer franchises while maintaining healthy profitability and asset quality. As on

March 31, 2008, the Bank had a network of 761 branches and 1,977 ATMs in 327
cities. For the year ended March 31, 2008, the Bank reported a net profit of INR
15.90 billion (Rs.1590.2crore), up 39.3%, over the corresponding year ended
March 31, 2007. As of March 31, 2008 total deposits were INR 1007.69 billion,
(Rs.100,769 crore) up 47.5% over the corresponding year ended March 31, 2007.
Total balance sheet size too grew by 46.0% to INR 1,331.77 billion

(133177 crore).

Leading Indian and international Publications have recognized the bank for its
performance and quality.

Centurion Bank of Punjab is one of the leading new generation private sector banks in
India. The bank serves individual consumers, small and medium businesses and large
corporations with a full range of financial products and services for investing, lending
and advice on financial planning. The bank offers its customers an array of wealth
management products such as mutual funds, life and general insurance and has
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established a

leadership 'position'. The bank is also a strong player in foreign

exchange services, personal loans, mortgages and agricultural loans. Additionally the
bank offers a full suite of NRI banking products to Overseas Indians. On 29th August
2007, Centurion Bank of Punjab merged with Lord Krishna Bank (LKB), post
obtaining all requisite statutory and regulator approvals. This merger has further
strengthened the geographical reach of the Bank in major towns and cities across the
country, especially in the State of Kerala, in addition to its existing dominance in
the northern part of the country. Centurion Bank of Punjab now operates on a
strong nationwide franchise of 404 branches and 452 ATMs in 190 locations across
the country, supported by employee base of over 7,500 employees. In addition
to being listed on the major Indian stock exchanges, the Banks shares are also
listed on the Luxembourg Stock Exchange.
AWARDS AND ACHIEVEMENTS
HDFC Bank began operations in 1995 with a simple mission: to be a "World-class
Indian Bank". We realized that only a single-minded focus on product quality and
service excellence would help us get there. Today, we are proud to say that we are
well on our way towards that goal.
It is extremely gratifying that our efforts towards providing customer convenience
have been appreciated both nationally and internationally.

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Awards In 2009
Table 4: Awards in 2009

Euromoney Awards 2009

'Best Bank in India'

Economic Times Brand

Equity & Nielsen Research

Most Trusted Brand - Runner Up

annual survey 2009

Asia Money 2009 Awards

'Best Domestic Bank in India'

IBA Banking Technology

'Best IT Governance Award - Runner up'
Awards 2009

Global Finance Award

'Best Trade Finance Bank in India for 2009

IDRBT Banking Technology

'Best IT Governance and Value Delivery'
Excellence Award 2008

Asian Banker Excellence in

Retail

'Asian Banker Best Retail Bank in India

Award 2009 '

Financial Services

Source: http://www.hdfcbank.com/aboutus/awards/default.htm

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Awards In 2008
Table 5: Awards in 2008

Finance Asia Country

Awards for Achievement

'Best Bank and Best Cash Management Bank'

2008

CNN-IBN

'Indian of the Year (Business)'

Nasscom IT User Award

'Best IT Adoption in the Banking Sector'
2008

Business India

'Best Bank 2008'

Forbes Asia

Fab 50 companies in Asia Pacific

Asian Banker Excellence in

Best Retail Bank 2008
Retail Financial Services

Best local Cash Management Bank Award

Asiamoney
voted by Corporates

Microsoft & Indian Express

Security Strategist Award 2008
Group

World Trade Center Award

For outstanding contribution to international

of honour

trade services.

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Business Today-Monitor
One of India's "Most Innovative Companies"
Group survey

Financial Express-Ernst &

Best Bank Award in the Private Sector

Young Award

category

Global HR Excellence
'Employer Brand of the Year 2007 -2008'
Awards - Asia Pacific HRM
Award - First Runner up, & many more
Congress:

Business Today

'Best Bank' Award

Source: http://www.hdfcbank.com/aboutus/awards/default.htm

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QUALITY POLICY OF HDFC BANK

Security: The bank provides long term financial security to their policy. The bank
does this by offering life insurance and pension products.
Trust: The bank appreciates the trust placed by their policy holders in the bank. Hence,
it will aim to manage their investments very carefully and live up to this trust.
Innovation: Recognizing the different needs of our customers, the bank offers a range
of innovative products to meet these needs.
Integrity
Customer centric
People care one for all and all for one
Team work
Joy and simplicity.

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Research
Methodology

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Research Objectives
To study the existing appraisal system in the organization.
To Study existing appraisal system in the organization exactly measures the
employees performance
To study that there is any opportunities provided for the employees to improve
their performance.
To Study the appraisal system assists in the employees training and
development.

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RESEARCH METHODOLOGY
Research Design

I have used Descriptive research design for this study.

SAMPLING DESIGN
Descriptive Research Design

SAMPLE SIZE: A sample of minimum respondents was selected from HDFC Bank,
Lucknow. An effort was made to select respondents evenly. The survey was carried
out on 40 respondents.

SAMPLE UNIT: In this project sampling unit consisted of the employees of HDFC
Bank, Lucknow.

SAMPLE AREA: HDFC Bank, Lucknow.

SAMPLING TECHNIQUE: For the purpose of research convenient sampling

technique was used.

SAMPLING FRAME: It consisted of various sources from where information about

the respondent is extracted. Mainly personal links and employees of HDFC Bank,
Lucknow are used for getting information about the respondents.

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DATA COLLECTION SOURCE: Two methods have been used to collect the
relevant data, which are essential for the study, they are:

Primary Data: data is collected to obtain desired information through structured

questionnaire.

Secondary Data: it is compiled through books, magazines, newspapers and internet

etc

TOOLS OF PRESENTATION:

STATISTICAL TOOLS TO BE USED: A structured questionnaires is used to

collect the data and data will be analyzed

with the help of percentage table,

respective graph, bar graph and pie charts.

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Limitations

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LIMITATIONS OF STUDY

Time and resource were the major constraints during the execution of the
project. Therefore only a limited number of employees were included in the
project.

The respondents were selected inside the organization only. So it cannot be

generalized as a whole.

Some of the respondents were not even ready to spare time with the
researcher.

There are many respondents who hesitated to answer the questionnaire.

The human behaviour is dynamic and hence the results may not hold good for
a long time.

The results of the survey are totally dependent on the accuracy and
authenticity of the information provided by the respondents.

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Contact for more

Shrikrishna Computer Chinhat
Lucknow
Mo no- 9554444951

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