Effects Of Appraisal System On Employees’ Productivity

Project and Seminar Material for Industrial Relations and Personnel Management

Effects Of Appraisal System On Employees’ Productivity


Abstract


Performance appraisals allow the organization to tell the employee something about their rates of growth, their competencies, and their potentials. The absence of effective performance appraisal is a fundamental cause of low output of staff to work. This study outlines the benefits that can be derived from the use of the performance appraisal system if it is properly administered to workers on the working environment of Cadbury Nig, Plc. It was found out that performance appraisal influences performance positively. However, the researchers realized that performance appraisal is mostly undertaken on annual basis at the workplace. Again, it was also realized that Cadbury Nig, Plc uses rating scale, descriptive system and management by objective system methods of appraisal to evaluate employees. It was also realized that management by objective is the mostly used method. Hence, it showed that appraisal is conducted annually in the organization. Finally, we realized from the research that performance appraisal has got much influence on job performance of Cadbury Nig, Plc employees.


Chapter One


Introduction

1.1 Background to the Study

One of the most popular tools used in the contemporary productivity enhancement programme is the application of performance appraisal systems. However, since appraising is considered to be a particularly controversial management practice anywhere it is being practiced, its adoption in the manufacturing industry in Nigeria faces numerous challenges and obstacles (Musi, 2015).

Appraisal system provides a rational medium or instrument for measuring individual worker contribution to corporate goals achievement and success. It is a complex management function which demand for extra-maturity, fairness and objectivity in assessing individual worker job performance based on explicit job related criteria (Onyije, 2015).

Appraising performance is important because since it helps to ensure that the organization system will be easily understood by employees and effectively put into action by managers. Appraisal structures that are complex or impractical tend to result in confusion, frustration, and nonuse. Likewise, systems that are not specifically relevant to the job may result in wasted time and resources. Indeed, most successful appraisal programs identify and evaluate only the critical behaviors that contribute to job success. Systems that miss those behaviors are often invalid, inaccurate, and result in discrimination based on nonrelated factors (Mwema and Gachunga, 2014).

Performance appraisal system is a critical component of the overall human resource management function in both private and public sectors. The use of performance appraisal systems is generally motivated by the desire to influence employee behaviors, attitudes and subsequently productivity. The quest for methods to motivate employees and thereby improve efficiency in the organisation has for a long time been influenced by persisting fiscal constraints, declining employee productivity and disenchantment with the delivery of public services (Musi, 2015).

Performance appraisal should be conducted periodically to evaluate an employee’s performance measured against the job’s stated or presumed requirements. It is important that members of the organization know exactly what is expected of them, and the yardsticks by which their performance and results will be measured. Mullins (2002) substantiated the necessity of an effective appraisal scheme by saying that it can identify an individual’s strengths and weaknesses and indicate how such strengths may best be utilized and weaknesses overcome (Mwema and Gachunga, 2014).

The appraisal system should be formalized especially in supporting decisions on salary and wage increases, transfers, promotions and dismissals, as well as communicating information toappraise through a review of their progress. Results of performance appraisal are used to discuss performance and progress of personnel in relation to goals (Wolf, 2005; Armstrong, 2012).

Performance appraisal as an element of performance management is often carried out to reveal individual employee’s contribution to the overall organizational objectives. To drive this notion home Biswajeet (2009) asserted that people do not learn unless they are given feedback on the results of their actions. For corrective actions to take place feedback must be provided regularly and it should register both successes and failures.


1.2 Statement of the Problem

The quest for methods to motivate employees and thereby improve productivity in the organisation has for a long time been influenced by persisting fiscal constraints and declining employee productivity. Salaries and Remuneration Commission of 2014 report shows that the current declining productivity levels experienced in the workplace is as a result of low executive commitment to performance appraisal systems, absence of rigor, objectivity and continuity in the administration of the system, non-linkage of the process to an enforceable reward and sanctions mechanism, non-linkage of the system to staff development, and lack of effective monitoring, annual reporting and feedback mechanisms. The end result of this failure has been the inability of the organisation to measure and evaluate the performance of their workers.

The process of appraising the performance of employees in Nigerian organizations is often vague, the areas of performance for which an individual is responsible are often unclear and evaluations are often not based on actual performance but on the perceptions and judgment of an employee’s immediate boss. Therefore, an ill-conceived and ill-considered appraisal system could create tensions in the organization.

In a sum, there are lots of problems associated with effective performance appraisal which includes untrained supervisors/managers, lack of effective metrics, inconsistent rating of employees, unreliable reward systems. It is on this premises that the study seek to know the effect of performance evaluation system on employee productivity.

Many of the studies on the impact of appraisal system on employee productivity were done outside Nigeria. These studies particularly focus on the public sectors. Research on appraisal system and employees’ productivity are very few. In Nigeria, most of the available studies aboutappraisal system were also theoretical studies whose findings were subjectively based on researchers’ personal opinions. It is noted that the past studies did not give adequate attention to the impact of appraisal system on employees’ productivity, as well as highlighting effectiveappraisal strategy that can stimulate better organization performance. Hence, the undertaking of this research work will fill in the gap by critically exploring the effect of appraisal system on employees’ productivity with a special reference to Cadbury Nig Plc.


1.3 Objectives of the Study

The main objective of the study is to examine the impact of appraisal system on employee productivity. Other specific objectives shall include:

  1. To examine the relationship between performance appraisal system and employee performance.
  2. To explore the nexus between periodic assessment and employees commitment to work
  3. To examine whether performance appraisal reveals employees’ actual strengths and weaknesses in the organization
  4. To examine the methods adopted in Cadbury Nig Plc to measure employee performance.
  5. To suggest ways by which appraisal system could be used to enhance employee productivity.

1.4 Research Questions

The research project beam a searchlight on the following research questions:

  1. What is the relationship between performance appraisal system and employee performance?
  2. How does periodic assessment affect employee’s commitment to work?
  3. Does performance appraisal reveal employees’ actual strengths and weaknesses in the organization?
  4. What are the methods adopted in Cadbury Nig Plc to measure employee performance?

1.5 Research Hypotheses

The researcher intends to test the following hypotheses;

Hypothesis 1:
  • Ho; There is no significant relationship between appraisal system and employee performance.
  • H1; There is a significant relationship between appraisal system and employee performance.
Hypothesis 2:
  • Ho; There is no significant relationship between employee appraisal and managers/employee relation.
  • H1; There is a significant relationship between employee appraisal and managers/employee relation.
Hypothesis 3:
  • Ho; There is no significant relationship between employee appraisal and organizational performance.
  • H1; There is a significant relationship between employee appraisal and organizational performance.

1.6 Significance of the Study

The outcomes of this study will first, enable managers to identify the areas where development efforts are needed so that personal and career development will be enhanced. Again it will help managers to make out individuals who have specific skills so that their promotions and transfer will be in line with organizational requirements. In addition, it will enable managers to administer a formal organization reward and counsel poor performers.

Furthermore, it will inform managers about which selection devices and development programs are needed for the smooth running of organizations. Finally, other researchers studying in the field of human resource management may find this research helpful to extend their knowledge about performance appraisals.


1.7 Scope / Limitations of the Study

This study on impact of performance Appraisal was carried out in Cadbury Nig. Plc. This study will cover all the employee of the above mentioned organization.

Financial resource was a major limitation to the research. Time constraint was the most frustrating as some of the respondents did not fill the questionnaire due to lack of time. Again some of the employees gave safeguarded answers to some crucial questions. Retrieval of answered questionnaires was a real challenge to the research.


Chapter Five


Summary, Conclusions and Recommendations

5.1 Summary

The absence of effective performance appraisal is a fundamental cause of low output of staff to work. This project outlines the benefits that can be derived from the use of the performance appraisal system if it is properly administered to workers on the campus of Cadbury Nig, Plc. The project traces the need for the evaluation process of been streamlined, proper procedures put in place and the need to create awareness in the staff of the institution to know what is expected of them. Performance appraisal, if properly constituted enhances planning and proper scheduling of work; it also examines the ways and means of assisting newly employed staff to find their feet in their new environment because the orientation programme which is used to introduce them to their new offices can be viewed subset of the whole annual performance appraisal system.

The appraisal system also calls for accountability on the path of both staff and supervisor, since they are made aware of what is expected of them. Supervisors who at the end of the year are called upon to assess their subordinates would be expected to show leadership by example, whilst subordinate are also expected to do their work without being asked to, they would also be expected to exercise a lot of initiatives in their duties.

It was found out that performance appraisal influences performance positively. However, the researchers realized that performance appraisal is mostly undertaken on annual basis at the workplace. Time factor was another hindrance since the researcher had to combine work and studies making it difficult to follow up on some of the issues that needed to be followed up like the collection of questionnaires, and time allotted for the interview.

The system of measurement to be adopted in ranking the performance of staff was another hindrance because there was no easy way of getting one system that could be used to measure the standard of performance of all the staff at the organization


5.2 Conclusion

It is now appropriate to draw out the main conclusions of the study:

From the study, findings and analysis showed that favoritism has not got much influence in appraising performance. Again, it was also realized that the company uses rating scale, descriptive system and management by objective system methods of appraisal to evaluate employees. From the analysis, it was realized that management by objective is the mostly used method. Hence, it showed that appraisal is an ongoing process in the company.

Another finding also revealed that 50% of the respondents received feedback information while the rest 50% do not.

Finally, we realized from the research that performance appraisal has got much influence on job performance. In other words, it was realized that appraisal has got a positive influence on performance.


5.3 Recommendation

From the above findings and conclusion, the research study recommends that organizations should enhance their employee’s productivity by appraising employee’s performance. The organization should then utilized accomplishments, targets, time management, organizational goals and efficiency for measuring performance purposes and evaluation process as it will help increase employee’s productivity.

From the research findings, the research study propose that organizations should develop and implement performance appraisal methods that would facilitate effective appraisal of the employees and hence providing opportunities to the organization in classifying performance targets, enhance employees performance, finding staff training needs and assisting employees on time management through proper planning and setting of deadlines. From the research results, the research study propose that companies should implement behavioural performance evaluation scheme and management by objectives as the appraisal methods were initiated to be statistically important in swaying employees relationship and enhancing employees productivity.


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Frequently Asked Questions


What are the benefits of performance appraisal to employees?

The manager can help guide the employee on the path to corporate advancement, and the employee gets a clearer understanding of what is expected from him or her in his/her daily duties performance appraisal have a wide variety of effects on employees that managers must identify and understanding such effects are:

What are the different views of performance appraisal differently?

Views of performance assessment differently depend does not on the employee’s particular needs and wants. Emphasis will be on keywords of performance appraisal, its steps, process and problem that are involved and also effects of performance appraisal on productivity and training for improved performance and to be analyzed.

What should be included in a performance appraisal?

Employees perform their duties to the best of their abilities throughout the year base on guidance from management part of a performance appraisal is when a manager and employee review the job description and compare the employee’s performance with expectations.

What are the benefits of standardized performance assessment?

Identifying Areas of Strength: The result of performance appraisal can be assessed to identify areas of strong performance across all employees by departments or by demographics. Standardized performance assessment allows companies to aggregate, calculate, and analyze results to show where performance is strong. 

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