CAIIB · Advanced Bank Management · Module B — Human Resources Management
CAIIB ABM Unit 14 — Performance Management: Free MCQs with Explanations
By Swarnakshi Jha (ex-banker) · Updated 29 October 2026 · Paper I of the December 2026 cycle (Sunday 6 December 2026)
This is the free practice page for CAIIB ABM Unit 14 — Performance Management (Module B — Human Resources Management). The CAIIB Mock Centre holds 197 questions on this unit alone, every one with a why-right / why-wrong explanation; below are the facts examiners keep returning to, five practice questions with explanations, and the traps that cost marks.
ABM · Module B197 MCQs in the Mock Centre5 free belowPaper on 6 December
Key facts examiners test from this unit
Performance appraisal: meaning, objectives and process — appraisal is inevitable (Flippo); the choice is the method, and a good one serves judgment, development and counselling through six steps.
Methods of performance appraisal — traditional methods rate traits, modern methods rate results; 360-degree adds many raters, 720-degree adds a second round.
Potential appraisal, rating errors and a good appraisal system — performance shows today's job, potential shows tomorrow's; open systems and trained raters beat confidential reports and rating errors.
5 free practice questions — tap an option
Five practice questions from this unit. Answers lock on the first tap, exactly as in the exam, and an explanation opens underneath. The Mock Centre has all 197 questions on this unit, from easy to tough, with caselets and key-in numericals, why every other option is wrong and the exam tip — and tracks your score and revision dates.
Question 1 of 5
Appraisal results serve both developmental and administrative purposes. Which of these is a developmental use?
Why (c): Developmental uses help the employee improve: appraisal identifies training needs and leads to coaching, counselling and planned interventions. Increments, promotions and transfers are administrative decisions that use appraisal results. (a) is wrong: Increments are an administrative reward decision. (b) is wrong: Promotion shortlisting is administrative. (d) is wrong: Transfers are administrative placement decisions.
Question 2 of 5
Management by Objectives emphasises:
Why (d): MBO is result-oriented and emphasises goal achievement rather than the method; it minimises external controls. (a) is wrong: MBO looks at achievements. (b) is wrong: It reverses MBO's emphasis. (c) is wrong: MBO tries to minimise external controls.
Question 3 of 5
In preparing for a review, what does the previous year's appraisal give the superior?
Why (c): The previous year's appraisal records the goals set for the current year, against which performance is reviewed. (a) is wrong: Salary is not set by the old form. (b) is wrong: This year's rating is yet to be decided. (d) is wrong: Transfers are not its purpose.
Question 4 of 5
Who defined competency mapping as "identifying key competencies for an organisation and the jobs and functions within it"?
Why (b): This is Dhar's (2006) definition of competency mapping. (a) is wrong: Garrette described mapping as a process an individual uses. (c) is wrong: Parry defined competency, not mapping. (d) is wrong: Spencer and Spencer defined competency.
Question 5 of 5
In a bank's assessment centre for promotion to branch head, what role should HR officials play?
Why (a): HR officials organise and facilitate the centre, scheduling exercises and briefing assessors and candidates, but are kept out of rating to avoid role conflict; the ratings come from several trained assessors whose judgments are pooled. (b) is wrong: HR training does not make them assessors; they facilitate to avoid role conflict. (c) is wrong: HR officials are kept out of rating altogether. (d) is wrong: Ratings come from pooled assessor judgments, not an HR review.
0 of 5 answered.
Traps in this unit
Appraisal is not only for promotions.
Measure only after standards are set and communicated.
Halo is common, not "always" present.
Practise all 197 questions on Unit 14. The free CAIIB demo opens Units 1–2 of every paper with full explanations; the ABM Online Mock Centre unlocks all 4,600+ ABM questions, the full-length papers with caselets and key-ins, module mocks and Smart Revision for 18 months (₹1,499).
Independent study aid — not affiliated with, endorsed by, or sponsored by the Indian Institute of Banking & Finance (IIBF). Exam pattern, dates, fees and passing criteria are set by IIBF — always confirm the current rules at iibf.org.in. CAIIB content follows rules and developments up to IIBF's cut-off of 30 June 2026 (where a rule changed later, the update box says so); verify from official sources before relying on them in practice.