Effect Of Employee Performance Appraisal On Organizational Productivity
Effect Of Employee Performance Appraisal On Organizational Productivity
Abstract
This study was carried out on the effect of employee performance appraisal on organizational productivity, using Union bank, Enugu Zonal Office. The study employed a descriptive survey method. The target population or universe of this study comprised the entire staff of Union Bank, Nigeria Plc, the actual size of the service could not be determined at the time of this study but it was estimated to be about three thousand two hundred (3,200), workforce. As the size of the population is too large for the researcher to cover within limits, the simple random sampling method was used to draw the samples of eighty (80) respondents Union Bank, Nigeria Plc, Enugu. The instrument for collecting primary data was through the use of questionnaires and interviews, closed ended questionnaires to be precise, where questions are structured in line with the research hypotheses and other relevant questions in the research study. The study established the problems affecting performance appraisal in Union Bank, Nigeria Plc as lack of managerial skills, emphases on connections and informal contacts, inadequate and insincere performance appraisal, inadequate training and development. Itwas concluded from the findings of this study that Union Bank, Nigeria Plc is faced with performance appraisal problems which have affected their service delivery. The study recommended that more emphases should be placed on training, retraining and development of staff.
Chapter One
Introduction
1.1 Background Of The Study
In any evaluation of the condition necessary for the growth and survival of an organization, the role of performance appraisal is a strategic factor. It is believed that both the individual and the organization need to know how well actual performance is contributing to the accomplishment of the job plans, the staffing plan, and ultimately the overall strategic plan of the organization. In addition, the individual employee requires feedback relative to his or her own goals development, as well as that relative to management’s expectations.
Performance appraisal is a formal and systematic assessment of an employee to determine the degree to which the employee is performing his/her job effectively. It is usually made in a prescribed manner of specific intervals such as quarterly, bi-annually or even annually. Each employee at one time or the other wants his immediate boss or more still his employer to assess his on-the-job performance, and where necessary give him guidelines or advice for improving his efficiency.
An effective performance review system serves these general purposes. In other words, as Nwachukwu (1985) puts it, “the essence of performance appraisal is to give information for the promotion, demotion, transfer, pay increase, training and development and discharge of an employee”.
Secondly, it provides employees with constructive on how they are performing in their jobs as viewed by their managers, thus leading to increased productivity.
Therefore, in any organization, manpower remains the most prominent and the most valuable assets among other factors of production. It is this reason performance appraisal is given recognition as a tool to improve organizational activities.
1.2 Statement Of The Problem
Since the study seeks to examine performance appraisal as management tool for increased productivity in Union Bank Nig Plc. It therefore attempts to identify various employee appraising techniques, some common appraisal problems and how proper performance appraisal can enhance increased productivity in Union Bank Nig Plc.
1.3 Objectives Of The Study
The main objective of this study is to determine the extent to which performance appraisal can enhance employee performance and productivity. Other specific objectives include:
- To examine the extent to which private sector managers utilize performance appraisal strategies to improve employees’ performance and productivity.
- To examine whether there is a relationship between performance appraisal and employees productivity in the Nigerian private sector.
- To determine how individuals objectives and corporate objectives can be integrated to achieve better employee performance and productivity enhancement in Union Bank, Nigeria Plc.
- To determine the extent to which organisational climate can influence workers behaviour towards better performance or otherwise.
- To suggest on how to overcome identified problems in the system, therebyproffering strategies for performance appraisal to become more effective and efficient while embarking on performance appraisal excise.
1.4 Research Questions
To investigate the problem of performance appraisal in Nigerian private sector, effort will be made to beam our search light on the following research questions.
- Do private sector managers use performance appraisal in improving workers performance and productivity?
- Is there any relationship between performance appraisal and employees’ performance and productivity in Nigerian private sector?
- Is there any correlation between performance appraisal and attitude to work by employees of Union Bank, Nigeria Plc?
- Can organisational climate influence workers satisfaction, performance and productivity?
1.4 Research Hypothesis
This study is geared towards testing the following four tentative statements or research hypotheses for the purpose of this research.
- Organizational productivity is not dependent on effective performance appraisal.
- There is no correlation between performance appraisal and attitude to work by employees.
- Organisational productivity is not dependent on employees’ satisfaction and performance.
1.6 Scope and Limitations of Study
Since the researcher cannot cover the Union Bank, Nigeria Plc within limit and available resources, the study covered only the 80 respondents at the Enugu Zonal Office for the purpose of this study. These include the management, supervisory and the junior cadre of the Organisation. All cadres of staff at the Organisation were selected as samples for the purpose of questionnaires administration.
In the course of carrying out this study, it is envisaged that certain challenges will be encountered. These include: time constraint due to the detailed nature of the topic to be investigated, access to respondents could be difficult due to the ever busy schedule of those to be interviewed. Getting some of the policy makers (Deputy and Assistant Directors) in the Organisation for comments could be difficult as they are either in a meeting or not on seat.
Also, travelling to Enugu where the Organisation Zonal Office is located could be a major limitation to the effectiveness of the research work, raising enough finance for the study could be difficult in view of the harsh economic conditions in the countryand sourcing for materials across the length and breadth of the country could be a major handicap to any effective research work. In fact, some of the libraries visited did not allow borrowing of relevant materials, while others allowed restricted patronage. In some cases, access to certain materials was possible only on a fee.
Yet, lack of access to information at the Organisation due to bureaucratic bottle-necks and the secretive nature of our private service are emphasized. Finally, the result of the findings of this study may not adequately apply to all other organizations in Nigeria as the study only focused on the civil service. However, none of these omissions and limitations may have any adverse effect on the conduct, reliability and validity of this research report, but they among other difficulties constitute the limitations of this study.
1.7 Significance of the Study
The expected benefits of this research study to all stake holders and partners in national transformation and development are so enormous. First and foremost, the purpose of every scientific research is to discover answers to questions through the application of scientific procedures. These procedures have been developed and adopted in order to increase the likelihood that information gathered are relevant to the questions asked and are reliable and unbiased.
Secondly, the Federal and indeed the States and Local Governments will through the findings of this study discover the immense importance of performance appraisal if we are to achieve service oriented private service in Nigeria.
Thirdly, this study will also present to the government and management of Union Bank, Nigeria Plc, the true picture of what their concern about workers appraisal should be. Hence this study is intended to give an insight into the best ways of integrating the organizational objectives with that of the workers. This will make management to develop and adopt performance appraisal techniques that would improve employee performance and productivity. yet, organisations, managers, directors and policy formulators will benefit a lot if they are aware of those factors inhabiting their employees from greater performance and productivity.
This study is also of both practical and theoretical significance. Theoretically, it is significant in the sense that it will add to a body of knowledge in this area both in Nigeria and other countries of the world. Practically, this study is significant in the sense that it will serve as an appraisal of the value of performance management and appraisal in a work place.
Scholars, upcoming researchers and students in general stands to benefit from this study as it serves as intellectual information depository for research development on topical issues. Through this study, they will know what have already been said concerning the study area and the areas that call for further study. Above all, it will serve a guide and reference materials for scholars, researchers as well as undergraduate and postgraduate students conducting research in partial fulfillment for the award of degrees.
1.8 Definition Of Terms
Usually in most social science research, in order to avoid ambiguity in the interpretation and understanding of certain terms, concepts used in the study must be clearly defined. The key concepts that are used in this study are defined below:
Appraisal:
AS a measure of individual staff work achievements against agreed targets. As a progress evaluation, employee performance or merit rating of an individual worker in areas of relative strengths and weaknesses so as to reinforce the areas of shortcomings
Attitudes:
The word is used in this research to mean how one feels about one’s job. It refers to those evaluative states either favourable or unfavorable concerning objects, people or events. Here we concentrated on job attitudes like job satisfaction, job involvement i.e. the degree to which a person identifies with his or her job and actively participates in it; and organizational commitment, an indicator of loyalty and identification with the organisation.
Private Service:
The term is used interchangeably with the term private service. It refers to the body of officials and state institutions engaged in the formulation, administration and implementation of private policies and programmes.
Private Servants:
As permanent people who earn their living by carrying out government tasks and responsibilities as directed from time to time by the constituted authority.
Development:
Is a way or method designed to increase the quality and quality of managerial personnel through training. It is always designed around the needs of individuals involved and it is evaluated periodically. Development can be measured in terms of profitability or growth level.
Effectiveness:
As the achievement of desired goals. Tangible properties which deal with physical manifestation, here our emphasis is on the quantity or unit of production measure against standard.
Efficiency:
As achieving a purpose with lowest cost i.e. the ratio of output to input required to achieve output i.e. achieving a purpose with a low cost. This is the imputation of limited resources to maximize greater output. This emphasizes on cutting down waste so as to improve more profitability for the overall benefit of the organization.
Equity:
Here is defined as the perception by the workers that motivational incentives are directly proportional to their input or effort at work as compared with the rewards in similar professions.
Incentives:
Incentives here refer to those financial and non financial materials, morale and psychological inducement that are given to Nigerian private sector workers which tend to boast their morale and ego towards better performance and higher productivity for the achievement of private service goals.
1.9 Historical Background Of The Case Study
Union Bank is one of the five leading banks in Nigeria, ranking with the First Bank Plc, UBA Plc, Zenith Bank and Guaranty Trust Bank before and after recapitalization of banking industry. Union bank plc is a commercial bank that has been existing from 1917 as the then Barclays bank DCO, New Union Bank of Nigeria Plc came into the country. Barclays bank is a subsidiary of Barclays International was incorporated in Nigeria when the banking decree of 1969 was promulgated. It changed its name to Union Bank of Nigeria Limited in March 1972, when the indigenization decree came into existence.
The federal government held 52% of the banks share 40% for the Barclays international which sold 30% of its share to Nigerian in 1979, ten years later they sold the remaining 20% to Nigerian making it a wholly indigenes bank.
When the banking reforms introduced by Central Bank Governor Prof. Charles Soludo, that all banks operating in Nigeria to shore up their shareholders funds by sum 1150 percent from N2 billion to N25 billion (equivalent of 192 million dollars) before December 2005, the Union bank go into merger and acquisition with the following banks for consolidation. The bank merged and acquired Broad Bank Plc, where the capital base rose over N25 billion.
The staff strength of the bank is about 1000 people of various professional backgrounds well trained and carefully selected to attend to customers need with the highest standard of personal attention, confidentially and competence.
Union Bank is active in all Commercial Corporation and investment banking as well as international transaction. The bank operations are varied with specialized products for different aspects of banking. The bank also involve within the same industry. The stock in which the bank trade in is banking services and currency as its major raw materials.
The bank has a tradition for responsive and quick decision making her service delivery is backed with the latest technology including computer system and software are constantly updated to ensure that all transactions are handled with speed and efficiency.
The corporate vision of Union Bank Nigeria Plc is to be the most strong and reliable bank and most profitable banking the commercial bank and most profitable bank in the commercial industry.
These dreams are already being unmanifested through volume of assets, merger and acquisition of various commercial banks that cannot meet the mandatory N25 billion capital base laid down by the Apex bank (CBN). Her impact on the economy and society in general employment roll have felt nationwide.
Chapter Five
Summary, Conclusion And Recommendations
5.1 Introduction
This study was carried out to ascertain the extent to which effective performance appraisal system are employed in the appraisal of organizational productivity in Union Bank, Nigeria Plc; this to determine the impact it has made on administrative efficiency and effectiveness of organization. The study focused on the staff of Union Bank, Nigeria Plc Zonal located in Enugu, Nigeria.
The questionnaire which highlighted the key areas of concern were administered, collated, and analyzed using the simple percentage and chi-square analysis and the respondents expressed different views or opinions. Opinions were formed from these responses about the relevance and impact of the performance appraisal in enhancing administrative efficiency and productivity and suggestions on ways to improve on employee performance review in the organization were made.
5.2 Summary of the Findings
The relevance of performance appraisal and human motivation to the understanding of workers performance and productivity cannot be overemphasized. However, it is important to note that theories of performance are seldom conclusive with regards to the production of what factors actually ignite employees towards productivity.
The need to trained and retrain organization staff so as to have good knowledge of what is expected of them and what management plan to achieve cannot be over emphasized. No matter how good a performance appraisal method may be, if it is not properly implemented, the end result will not measure up to set standard; hence it will end up a fruitless effort. More emphasis should be placed on propertraining and reorientation of workers and those who fail to perform should be sanctioned.
In a nut-shell, productivity is the objectives of all organization. What we do know is that a multiplicity of factors is involved in performance and productivity improvement, and many of these factors are interdependent. It responds to many factors as x-rayed in our literature review; how the leader in the organization use these variables determine the level of employee performance and productivity. Knowledge of them and how to use them by leaders are therefore conditions precedent to better employee performance and productivity enhancement.
5.3 Conclusion
It was concluded from the findings of this study that Union Bank, Nigeria Plc is faced with performance appraisal problems which have affected their service delivery. The study established the problems affecting performance appraisal in Union Bank, Nigeria Plc as lack of managerial skills, emphases on connections and informal contacts, inadequate and insincere performance appraisal, inadequate training and development.
These problems have created difficulties for the organisation to perform and deliver as a regulatory financial institution. As a result of these problems in the system, the study also observed that workers are not induced to compete for excellence and greater performance. The study also revealed that Union Bank, Nigeria Plc designs performance appraisal system but with relatively low level of utilization at the lowest grade levels which has affected position classification and identification of defined duties and responsibilities in the system. It was finally concluded that as a result of lack of effective performance appraisal system in Union Bank, Nigeria Plc, the system is perceived to comprise of lazy, lousy, ineffective and inefficient people, resulting to low employee performance and productivity in the organization.
5.4 Recommendations
Based on the study’s findings and conclusions, we recommend that more emphases should be placed on training, retraining and development of staff. This is because training is an antidote for better employee performance and productivity. There should be regular and effective institutionalized training in performance appraisal and implementation for executive and administrative managers. There should be a correlation between training and training needs when designing training programs.
Union Bank, Nigeria Plc should design and implement remuneration, incentives and welfare schemes that are inconsonance with the private sector and in realities with the cost of living index or standard. Also, individual and corporate objectives should be integrated to achieve better employee performance and high productivity in the organization. This is based on the fact that while other resources are important to the success of any organization, the human elements are the most significant because it is the people who have to coordinate and use other resources to achieve organisational objectives.
That emphases placed on all kinds of subjective and informal contacts in recruitment exercise should be discouraged. Reliable and valid selection instruments should be devised. The aim is to attract and recruit as many qualified applicants as possible.
The need to re-assert meritocracy in reward and reward management, as well as the need to improve accountability in the organization cannot be over emphasized, as higher pay alone will not automatically lead to higher performance and productivity. The enforcement should start from the top level down to lower cadre; there should be a level of accountability from those who manage the organization.
Finally, there should also be a human capital audit, organizational and physical performance audit and audit reports should be submitted to management periodically. The immediate priority, therefore, is the need to re-examine the validity and reliability of performance management and appraisal instruments in use in the organisation. Above all, the recommendations must be sustained overtime and must be inculcated as a way of life in the study area in particular and the various Ministries, Departments and Agencies (MDAs) in general for sustained performance management and appraisal.
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