The Effect Of Performance Appraisal On Employees’ Productivity In The Public Sector

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The Effect Of Performance Appraisal On Employees’ Productivity In The Public Sector


Abstract


This study is delved into the effect of performance appraisal on employees’ productivity in the public sector using The Nigerian Custom Service as a case study. Performance appraisal helps to ensure that organizational members possess the knowledge and skills they need to perform their jobs effectively, take on new responsibilities, and adapt to changing conditions. It is also believed those performance appraisals identifies the weakness of employees and sport the areas which development efforts are needed in the organization.

This study is carried out with duly valued questionnaires which were used as instrument to collect primary data from 120 respondents for statistical analysis. The result of data were analyzed with simple percentage, bar chart and frequency distribution while the stated hypotheses were tested using Pearson Moment Correlation (PPMC) statistical tool to test the four (4) hypotheses formulated. The result of the four hypotheses tested indicates that: there is high positive relationship between performance appraisal and employees’ productivity in Nigeria Custom Service, there is no problem that hampers the use of performance appraisal in Nigerian Custom Service.

Based on the findings of this research, it revealed that performance appraisal improves the employees’ performance. Some vital recommendations were made which are put forward based on the findings and conclusion of this research that performance appraisal should be up- to-date with new process or technology and methods because new studies and researches enhanced learning methods, identification of performance appraisal needs to be done more professionally in conjunction with line manager as well as individual involved together with the human resources manager. Also a basic for motivating through equity and development rewards should be provided as this will lead to commitment and improved performance. It concluded that performance appraisal is a tool for identification of deficiencies which point out the weaknesses of employees and spot the areas where development efforts are needed in the organization.


Chapter One


Introduction

1.1 Background to the Study

Performance appraisal is a tool for identification of deficiencies which point out the weaknesses of employees and spot the areas where development efforts are needed in the organization. Performance appraisal also plays a key role to measure the employee’s performance and help the organization to check the progress towards the desired goals and objectives (Ijbmr, 2012). Now organizations are using performance appraisal as a strategic approach by coordinating the human resource functions and business policies. They are focuses on it as it is a broad term that covering number of activities like examines employees, improve abilities, maintain performance and allocate rewards (Fakharyan, Jalilv and Dini, 2012). Performance appraisal help aligns individual goals and objectives with the organization goals. The system engages, motivates employees and thereby directs them toward achieving the strategic ‘goals of the organization (Verhulp, 2006).

The fact remains that good organization performance refers to the employee’s performance, satisfactory performance of employees does not happen automatically. Managerial standards, Knowledge and Skill, Commitment and Performance appraisals have effect on employee’s productivity. According to Lillian and Sitati (2011) opined that the history of performance appraisal is quite brief. Performances appraisal roots can be traced in the early 20th century to Taylor’s pioneering time and motion studies. The performance appraisal system start in practiced mainly in the 1940s and with the help of this system, merit rating was used for the first time near the Second World War as a method of justifying an employee’s wages. There are number of government establishment in Nigeria using the performance management system for making their employee’s productivity better because it leads to achieve organizational performance. However performance appraisal is very important process but it deemed to be the “weak point” of managing human force (Pulakios, 2009). Therefore performance appraisal is important to manage employee’s work effectively.

According to Armstrong (2001) who found performance as behavior the way in which organization’s teams and individuals get work done. (Mooney, 2009) suggested that performance is not only related to results but it also relates with activities and behaviors of employees that they adopted to achieve their given goals. Performance appraisal is the systematic evacuation of employees according to their job and potential development. (Pinar Güngör, 2011) says “Motivation is the ability of person to modify his/her behavior”. Motivation is a driven force that leads and directed a person toward some specific goals.

Performance appraisal has been helping an employee knowing what is expected of him and remain focused with the help of the supervisor, tells them how well they have done that motivates the employees toward the good performance(Casio, 2003). Performance management system is the process that strongly involves assurance and participation of employees within the organization and that determine the organizational results. The evaluation system identifies the gap of performance (if any). The feedback system tells the employee about the quality of his or her work performance (NCN report HR Department’, 2010). Performance appraisal can enhance the benefits for the organization, but apparently it is not delivering the benefits in many cases (John Mooney, 2009).

Most of the organizations usually include performance appraisal they cannot take the benefits from that because there lay a huge difference between the anticipations and experiences in the present system (Elverfeldt, 2005). Importantly, most employees believe that the major outcome of performance appraisal is promotion and its attendant increase in financial benefits plus enhanced professional and social status (Tessema and Soeters, 2006; Shahzad, Bashir and Ramay, 2008). Performance appraisal outcomes tend to have high motivational impact and are a major determinant of employee performance. This matrix of tasks makes the job of Nigerian Custom Services is highly demanding, thereby requiring an effective performance evaluation system that will ginger higher motivation for enhanced job performance (Aslam, 2011).


1.2 Statement of the Problems

Performance appraisal has been criticized by people because approach like bureaucratic and top-down under the control of human resource managers. It was often backward looking, concentrating on what had gone wrong, rather than looking forward to future development needs. Performance appraisal schemes existed in isolation. There was little or no link between them and the needs of the business. It has been discovered that line managers have frequently rejected performance appraisal schemes as being time consuming and irrelevant. Employees have resented the superficial nature with which appraisals have been conducted by managers who lack the skills required, tend to be biased and are simply going through the motions.

Additionally, situations may arise sometime whereby only some selected job elements are evaluated or given preference or higher points above other job elements in which the employee was equally engaged during the review period. This gap is the problem that occurs when performance does not meet the standards that are set by the organization. This calls to question the fairness of the appraisal system and its ability to effectively produce the desired outcomes. Performance appraisal believes to be a difficult and complex activity which is often not performed well by many organizations. It is quite understandable that the end result of this is that it produces exactly the opposite or have adverse effect to those intended.

Furtherance to the state of the problem, currently in Nigeria, it has seen in the public sector that general atmosphere of discontent pervading the entire labour panorama, which Nigeria Customs Service are not left out in the general state of disappointment and aggravation. In Nigeria today, the general state of poverty makes economic reward a very important reason why people go out to work, thereby making money to rank highly as a critical motivator. This situation has made it imperative for Nigerian workers to pay particular attention to human resource practices which have direct bearing on their financial rewards and social status. One of such human resource activities is performance appraisal, which is the focus of this study.


1.3 Objectives of the Study

The main objective of the research is to examine the effect of performance appraisal on employees’ productivity in the public sector.

Other salient objectives include;

  1. To assess the significant relationship between performance appraisal and employees’ productivity in Nigeria Customs Service
  2. To evaluate the factor inhibiting the use of performance appraisal of employees in Nigeria Customs Service.
  3. To know whether the -favouritism is responsible for ineffectiveness in the Nigeria Customs Service
  4. To make appropriate suggestions on how the use of performance appraisal system could enhance employees’ productivity in the Public Sector.

1.4 Research Questions

The study intends to seek answers to the following questions;

  1. Is there any significant relationship between performance appraisal and employees’ productivity in Nigeria Customs Service?
  2. Is the use of performance appraisal system affect employees’ productivity in Nigeria Customs Service?
  3. Will favouritism be responsible for ineffectiveness in the Nigeria Customs Service?
  4. Those performance appraisal enhance employees productivity in Nigeria Custom Service.

1.5 Statement of Hypotheses

The following research hypotheses were formulated for this study:

Hypothesis one
  • Ho: There is no significant relationship between performance appraisal and employees’ productivity in Nigeria Customs Service
  • Hi: There is significant relationship between performance appraisal and employees’ productivity in Nigeria Custom Service
Hypothesis Two
  • Ho: There is no significant relationship between problem hamper the use of performance appraisal system and employees productivity in Nigeria Customs Service
  • Hi: There is significant relationship that harripers the use of performance appraisal system and employees productivity in Nigeria Custom Service
Hypothesis Three
  • Ho: Favouritism is not responsible for ineffectiveness in the Nigeria Customs Service.
  • H1: Favouritism is responsible for ineffectiveness in Nigeria Customs Service.

1.6 Scope and Limitations of the Study

The scope of the study covers the effect of performance appraisal on employees’ productivity in Nigeria Customs Service as a case study. However, the study focuses on how performance appraisal used in an organization to increase employees’ productivity. However due to the nature and scope of the work, such a wild scope is out of the question since a work of this nature can hardly achieve a feat. This study is limited mainly on the appraisal system and training pattern described as ways of improving workers performance in an organization in Nigeria Customs Service (2007 —2013).


1.7 Significance of the Study

In the light of the foregoing, this study set out to investigate how performance appraisal that is anchored mainly on one job component, that is, research output, affects the motivation and overall performance of Nigeria Customs Service. However, despite the fact that engagement in research will help to update, sharpen, enlarge and enrich the Custom Officers’ knowledge base, which is in turn transferred to the organization, citizens, importers and exporters positively.

This study will serve as assistance differentiates satisfactory performers from unsatisfactory ones in Nigeria Customs Service. The performance appraisal will help the management to perform functions relating to selection, development, salary, promotion, penalties, lay-off and retrenchment. This study will geared towards the improvement productivity in the public sector through a better evaluation of employee’s performance, Therefore, this study will help in bringing ways by which employee are appraised as well as how their needs are being managed in Nigeria Customs Service. Finally, based on the abovementioned, this study would be of significance to all military men, policy and decision makers, management of organisation as well as students, scholars and upcoming researchers who may conduct similar study in future.

This widespread use can be attributed to human resource specialists, academics, and consultants who proclaim that performance appraisal is a critically needed tool for effective human resource management. This, in turn, is based on the belief that an effectively designed, implemented, and administered performance appraisal system can provide the organization, the manager, and the employee a myriad of benefits.


1.8 Operational 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.

Public Service:

The term is used interchangeably with the term public service. It refers to the body of officials and state institutions engaged in the formulation, administration and implementation of government policies and programmes.

Public 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 public sector workers which tend to boast their morale and ego towards better performance and higher productivity for the achievement of public service goals.

Management:

Management is the act of using the resources in an organization (i.e. training and material) to attain desire objective. Also, management can be said to be a team of people who are saddled with the responsibility to take certain key decisions that will determine future of the organization, a faulty policy by the management will bring about faulty result viz-versa. It involves the control of human and materials resources towards achievement of organisational goals and objectives. Getting things done through others, efficient utilization of resources. Guiding or directing a group of people towards organizational goals or objectives, i.e. the act of planning, organizing, staffing, directing, controlling, leading and separation with an organisation.

Motivation:

Motivation here refers to goal-directed behaviour i.e. the process and means of influencing and activating a workers energies and full potentials towards the performance of set tasks and achievement of agreed organizational goals and objectives.

National Development:

As a process involving the re-orientation and re-organisation of the entire economic, social and political system. It involves improvement not only in income and output per head, but radical changes in social, institutional and administrative structures as well as attitudes, customs and beliefs of people in Nigeria.

Objectives:

Objectives are unbiased aims or purpose existing in real world outside the training mind. That is to say, objectives are those ends that an organization seeks to achieve by its existence and operation. The more the objectives are clearly determined, stated and understood, the more likely they are achieved. The main characteristics of objectives are: Objectives are advance or predetermined statement; Objectives describe future desire results towards which present efforts are directed; Objectives serve a variety of functions in any organization t.

Performance:

This is simply referred to the extent to which an individual, unit or department carryout task assigned to him. It is also a means by which an organization evaluate an individual employee input and out level especially in the area of attaining set goals or task assigned to him or her. It involves the execution of duties and responsibilities assigned by constituted authorities which one have promised to do, so as to achieve set goals. Performance of the Nigerian civil servants measured in terms of effectiveness and efficiency

Policies:

As the general guides to action which constrain or direct objective attainment. In the light of this, policies channel how management/government orders its affairs and its attitude towards major issues: the guide to the dictate of the intent of those who guide the organisation/government institutions. In other words, instrument which define the universe from which future strategies and plans are derived.

Public Sector Productivity:

As the ratio of what is produced to what is required or expected to produce in the public civil. The output per person hour of input, it also includes client satisfaction which can be seen in terms of value of project or programme to the society, opinion or feelings of cliental over a policy or project etc. they are described as intangible properties.

Strategy:

As the basic steps or approaches of management/government towards effecting positive change in the Nigeria Custom Servicen in order to reach an objective or set of objectives. In other words, the methodologies or measures adopted or outlined by the towards the achievement of employee better performance and productivity improvement in the Nigerian public service to achieve its objectives.


1.9 Organization of Study

The organization setting of this study commences with an introduction i.e. a background statement, statement of the problem, then objectives of the study and research questions. These are closely followed by statement of research hypothesis and scope and limitations of the study, the significance/utility of the study and the definition of terms all within the first chapter.

Chapter two is made up of introduction, review of related relevant literature on the research topic and the theoretical framework. We reviewed the conceptual framework where we looked at the concept and definition of performance appraisal, performance and productivity improvement, objectives of performance appraisal. Also reviewed are significance/purposes of performance appraisal, problems of performance appraisal as well as steps for productivity improvement

The second phase of the review focused on the theoretical framework where theories of performance management, concept of reward and reward management as well as motivation theory and relevance of the theories to the study. We concluded with a summary of the chapter.

Chapter three devolves on the research methodology where aspects such as introduction, restatement of the research questions and hypotheses, the research variables, research design, target population, sample size and sample adopted, methods of data collection, research instruments used as well as a detailed explanation of administration of research instruments and methods of analysizing such data and finally limitations of the methodology.

The fourth chapter contains the analysis of the data itself and the exposition of responses. We commenced this chapter with a brief introduction, followed by respondents’ characteristics and classification, then presentation and analysis of data according to research questions. The presentation and analysis of data according to tested various research hypotheses to validate or invalidate the earlier claims of the research then comes discussion of the research findings.

Finally, the fifth chapter summaries the results of the fourth chapter, draws conclusions, propose appropriate recommendations to the research problems.


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 employee ; this to determine the impact it has made on administrative efficiency and effectiveness of organization. The study focused on the staff of Nigeria Custom Service 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 proper training 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 is faced with performance appraisal problems which have affected their service delivery. The study established the problems affecting performance appraisal in 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 bank 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 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 , 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.

Nigeria Custom Service 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 bank. 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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