ABSTRACT
This
study examined the relationship between employees’ performance appraisal and
organizational growth. It employed the descriptive survey research method. The
random stratified sample method was used to select the total numbers of 250
respondents used for the study. Data used for the study were collected through
the questionnaires. Hypotheses one and two were tested using the t-test of
significance method while hypotheses three to five were tested using Chi square
statistics method with the help of Special Package of Social sciences (SPSS).
Findings of the study showed that the tested employees of Nigeria Bag
Manufacturing Company placed significant attention to performance appraisal system; there was a
significant difference between Performance Appraisal of Nigeria Bag
Manufacturing Company (BAGCO) and those of literature. Result further shows
that Nigeria Bag Manufacturing Company managers have significant knowledge of
the method of Appraisal System and a significant relationship exist performance
appraisal m and organization growth.. It is recommended that individual
goals should derive from strategic direction and overall company goals. These
goals should be stated in measurable term so that the expectations of the
employee and the manager could be aligned. Managers should have good knowledge
of employees’ performance appraisal system and that performance appraisal
should have a feedback.
TABLE
OF CONTENT
Title
page i
Certification ii
Dedication iii
Acknowledgements iv
Abstract v
Table of Content vi
CHAPTER ONE- INTRODUCTION
1.1
Background of the Study 1
1.2
Statement of the Problem
6
1.3
Aims / Objective of the Study 7
1.4
Relevant Research Questions 8
1.5
Relevant Research Hypotheses 8
1.6
Significance the Study 9
1.7
Scope of the Study 10
1.8
Operational Definition of Terms 10
End
of Chapter one References 11
CHAPTER TWO- LITERATURE REVIEW
2.1 Preamble 12
2.2 Theoretical
Framework of the Study 12
Concept
of Appraisal Performance 15
Benefits
of Performance appraisal 18
Concerns
and challenges of Performance appraisal 20
2.3 Empirical
Review of Previous Work in the Subject of Study 25
End
of chapter two References 29
CHAPTER THREE- RESEARCH METHODOLOGY
3.1 Preamble 32
3, 2 Research
Design 32
3, 3 Population
of the study 32
3.4 Sampling
Procedures and Sample size 32
3.5 Data
collection Instrument and Validation 33
3.6 Method
of Data analysis 33
3.7 Limitation
of the Methodology 33
End of chapter three
References 34
CHAPTER FOUR- DATA PRESENTATION AND
ANALYSIS
4.1 Preamble 35
4.2 Presentation
and analysis of Data according to Research questions 42
4.3 Testing
of Hypotheses 48
4.4 Discussion
of Findings 53
End
of chapter four References 56
CHAPTER FIVE- SUMMARY, CONCLUSION,
RECOMMENDATION
5.0 Preamble 57
5.1 Summary 57
5.2 Conclusion
59
5.3 Recommendations 60
End of chapter five
Reference 62
Bibliography
63
Appendix 67
CHAPTER
ONE
INTRODUCTION
1.1
Background
of Study
Growth
is essential to organization’s survival. Without it, the organization will find
its competitive position weakened as rivals increase their hold on the market;
eventually it will either suffer a declining market share or succumb to a
takeover. In addition, growth offers a greater opportunity to satisfy the
aspiration of the diverse interests within organization. It should be borne in
mind that willingness to grow is not sufficient. Condition both within and
outside the organization must be favourable to growth if this is to be
achieved. The human resources have been
identified as a critical factor in organization growth. Ever since the time of
Abraham Taylor (1856-1951) productivity improvement in organization had been an
issue of great concern (Idemobi and Onyeizugbe, 2011). It is noted that there
is negative influence of group on performance.
As a result Abraham Taylor broke informal group activities through
spatial and work-flow designs and individual piece rate system of pay. Taylor
had based his management system on production-line time studies. Instead of
relying on traditional work methods, he analyzed and timed steelworkers’
movements on a series of jobs. He
therefore, encouraged employers to pay more productive workers at a higher rate
than others, using a “scientifically correct” rate that would benefit both
company and worker. Thus, workers were urged to surpass their previous performance standards to earn more pay. Rather
than quarrel over
profits, both management
and workers should
try to increase production and by so doing, he
believed, profits would rise to such an extent that labour and management would
no longer have to fight over them. What this analysis seems to suggest is that the productivity
of an organization
is jointly determined
by the efficiency with which the organization
utilizes several available factors of production which invariably are scarce relative to the demand for them. In
other words, organizations can only win a competitive advantage through people (Obisi
(2011).
However,
the importance of effective employees’ performance appraisal system cannot be
underscored. In this ever increasing and competitive world, organizations
can grow to the extent
that people who
work in such organization are supported to grow. It
has been reported by researchers that many Nigerian business organization pay
less attention to performance appraisal system despite the believe that management and labour had a common
interest in increasing employees’ productivity in the organization, evidence in
the literature also suggests that 44% of organizations worldwide use performance
measurement systems as a mechanism to improve employee performance (Idemobi and
Onyeizugbe, 2011). Yet, many Nigerian Organization view performance
appraisal and conduct it solely in terms of its evaluative aspect thereby
overlooking its use to facilitate growth and development in employees through
training, coaching, counseling and feedback of appraisal information (Obisi,
2011). Nigerian business organizations need to view performance appraisal as a major
management practice to assess the immediate and future relevance of their workers.
By so doing, employees will contribute more to the achievement of their
business organizations’ goal and objectives.
However,
it should be borne in mind that performance appraisal system facilitates
communication between the employees and their immediate supervisor by providing
a structure for feedback on performance. This demands that employees should understand
the need for performance appraisal to improve productivity. Once this is
understood, the employees and supervisors or managers have to define the
expectations by using the job description. Also, supervisors should conduct
reviews regularly during the year in order to discuss the employee’s progress
toward accomplishing desired results and to address ongoing issues. Good
employee relations are built upon fair and equitable treatment. It is important
that treatment of employees must be based on definite standards, applied fairly
and without discrimination. There are seven performance factors identified for
all employees and one additional optional factor. They include communication, customer
service, cooperation/teamwork, quality, productivity/core organizational/business
skills, job knowledge/technical proficiency and professionalism (Wikipedia
contributors, 2014). In the performance level, it should be borne in mind that
manager will rate each performance factor, on a scale of 1 to 5, as it relates
to employee performance. Specific, objective comments may be included to
support the ratings. Managers and employees must share a common understanding
of what each rating signifies, and use them consistently. There are four
performance levels documented in the existing literature. The first performance
level is the outstanding that is reserved for individual whose work performance
is clearly and consistently superior to the standards required for the
position. This caliber of performance is easily recognized by others in related
areas as well as outside of the individual’s own group or function. The
individual is successful in unusual and adverse situations, meets extraordinary
business challenges with little or no guidance, and sets a positive example for
others. Results significantly exceeded performance standards/objectives over a
sustained period. Second is the expectation that explains how individual
exceeds most requirements of the position, including all key areas. This rating
demonstrates a level of accomplishment that goes beyond reasonable and
demanding standards, particularly in key knowledge, skills and abilities.
Performance is characterized by high achievement and the individual
demonstrates planning and execution of all routine functions and most major
functions with minimal guidance. Third, achieves expectations describes how individual
demonstrates a level of accomplishment that clearly fulfills expectations and
at times exceeds them. It reflects good, solid and consistent performance. Has
demonstrated ability to execute and control routine functions and several major
functions with occasional guidance. Four, minimally meets expectations shows
how individual demonstrates a level of accomplishment that is below the
standards of performance and does not meet or marginally meets the
requirements. This individual demonstrates an inconsistent level of achievement
and requires more direction and guidance than normally expected for routine
function.
In
developed world, performance
appraisal has been used to exposes the strength
and the weakness
of the staff
on the job especially in
developed world (Per.
Com, .2013). In these countries, performance appraisal practice is done without the appraisers attaching themselves
to the exercise unlike developing countries where the exercise is said to be
unproductive and affect organizational goals. For
every organization to
constantly realized its
set goals, it is
important that performance appraisal must become
a regular exercise and must occupy central role/or function of the
management. The unbiased
practiced of performance appraisal will make all organizations to
face keen competitions
and challenges at local, national and international levels. That is,
performance appraisal is must become a tool to measure the status of any organization
across board. Hence, this study seeks to
examine performance appraisal as a management tool, exercise or practice to
determine the retention, promotion of staff and productivity of Nigeria Bag
Manufacturing Company (BAGCO). The
company pioneers the manufacture of woven polypropylene sacks thus
contributing to economic growth and development. The company seems
to be efficient in resources use. As noted by
Oluwo (2014) BAGCO’s In-Plant Training has so far accounted for 95% of its
middle level manpower needs. External training programmes are also conducted to
meet new challenges in the industry.
Most
undeniably, empirical evidence has shown that many organizations in Nigeria have not
given adequate attention to performance
appraisal review as a tool for improving performance even when recent
studies suggest that performance reviews benefit
organizational performance in
both private and public sectors (Asamu, 2013; Kolawole, Komolafe, Adebayo and
Adegbroye, 2013; Obisi, 2011; Dechev, 2010 to mention but
few).
Undeniably,
many Nigerian Organization view performance appraisal and
conduct it solely in terms of its evaluative aspect thereby overlooking its use
for facilitating growth and development in employees through training,
coaching, counseling and feedback of appraisal information (Obisi, 2011). Worst still, it is reported that most
of the managers and employees have only a few positive things to say about
performance appraisal and many of them even dislike it. Hence, performance
appraisal is accorded a lesser role in Nigerian organization as more emphasis
is given to selection, training, development and salary administration. This seems
to imply genuine individual and organization growth are stifled because of the
seemingly wrong approach. In essence, the inability of organization to install an effective
performance appraisal strategy has hindered them from achieving competitive
advantage which they require more now than ever before. It is further pointed that
appraisal processes are not systematic and
regular and often
characterized by personal
influences occasioned by
organizations preoccupation to use confidential appraisal system which
hinders objectivity and fairness. Effective performance management is essential
to ensure that a business is operating effectively and is on track to achieve
strategic goals. On this note, this study seeks to assess the casual
relationship between appraisal performance and organization growth.
1.2
Statement
of Problem
Many
organizations in Nigeria businesses have failed because of ineffective and inefficient
performance appraisal system (Obisi, 2011). The performance of staff of
executing agencies or public enterprises is limited to budget monitoring and
annual performance evaluation. However, experts are of the view that
there is no
link between employee
performance and organization productivity or growth (Idemobi and Onyeizugbe, 2011). These
organizations are required to give adequate attention to performance management
reviews to enhance productivity.
Research
studies have shown that only a few
organizations in Nigeria organizations
are making efforts
to embark on
a performance appraisal
review with the commensurate reward system. Some researchers
blame this on managers who do not have adequate information on performance
review techniques that could have significant impact on employees’
performance for greater
organizational effectiveness (Esu
and Inyang, 2009). The inability of organization to
install an effective performance appraisal strategy has hindered Organizational
performance and its resultant efficiency and effectiveness can only be achieved
when individuals them from achieving competitive advantage which they require
more now than ever before. Nevertheless, where employees job are evaluated
appraisal processes are not systematic and regular and often characterized by
personal influences occasioned by organizations preoccupation to use
confidential appraisal system which hinders objectivity and fairness. Often
organizations ignore management by objectives, critical incidents to personal
prejudices. This is retrogressive as it affects the overall performance of the
individual and often characterized by personal influences. This research study
seeks to assess appraisal performance as a tool for organization growth.
1.3 Aims /
Objectives of the Study
The general objective of the study
is to examine the relationship between performance appraisal organization
growths. Specifically, it is set out to:
1. Ascertain if Nigeria Bag
Manufacturing Company (BAGCO) attaches any significant importance on performance
appraisal review.
2. Find out if any difference exists between
BAGCO’s performance appraisal system and what literature reveals about
appraisal system of Nigeria business Organizations.
3. Assess the effectiveness of
organization performance appraisal review in Nigeria.
4. Examine the manager’s knowledge of performance
review techniques that could have significant impact on employees’ performance
for greater organizational effectiveness.
5. Assess the relationship between
performance appraisal and organization growth.
1.4 Relevant Research Questions
The following questions will guide
this research study
1. Will Nigeria Bag Manufacturing
Company place any priority to performance appraisal review in evaluating its employee
job performance?
2. Will BAGCO’s performance appraisal
system differ from what literature reveals about appraisal system of Nigeria
business Organizations?
3. To what extent has the company’s
performance appraisal review impacted on its productivity?
4. Does the manager’s have any
significant information about performance review techniques that could have
significant impact on employees’ performance for greater organizational
effectiveness?
5. Does performance appraisal have any significant
relationship with organization growth?
1.5 Relevant Research Hypotheses
The following null hypotheses will
guide this study
Ho 1: The Nigeria Bag Manufacturing
Company will not attach any significant importance to performance appraisal
system.
Ho 2: There will be no
significant difference between BAGCO’s performance appraisal system and what literature
reveals about appraisal system of Nigeria business Organizations.
Ho 3 The performance appraisal system of the
Nigeria Bag Manufacturing has not made any significant impact on its growth or
productivity.
Ho 4: The manager does not have any significant
information on performance review techniques that could have significant impact
on employees’ performance for greater organizational effectiveness?
Ho 5: There is no significant relationship
between performance appraisal and organization growth.
1.6 Significance of the Study
This study has implication for promoting
employees’ performance for greater organizational effectiveness. It is also
relevant in the true sense that it will make managers in business organization
in Nigeria to give adequate attention to performance management reviews to
enhance productivity. This research study will help educate employees and
supervisors on the area of having communication that will provide a structure
for feedback on performance. Therefore, this study will enhance employees
understanding and use performance appraisal as an opportunity to improve
employees’ productivity and develop his or her full potential. This research
study identifies and documents the present performance appraisal review of Nigeria
business organization. The awareness that this study will create would help
organization to tilt to effective performance appraisal and management
performance appraisal to bring about growth.
Organization will have to benefit from this study by achieving its
vision and objectives. Employees will also benefit through performance
incentives and morale. The study will also give employees the confidence to give a
good appraisal in order to \work environment. The study will help employers to
properly design and implement their organization aims and objectives leading to
a strong relationship between the
work performance and
the achievement of
the organization. It will add to
the growing body of knowledge.
1.7 Scope of the
Study
This research study focuses on
employee performance appraisal as a tool for enhancing organization growth. It
covers 250 employees of Nigeria bag manufacturing company. This will be
replicable to business firms or organizations in Nigeria. Obtaining materials
and gathering useful information from the employees also poised some
constraints.
1.7 Operational
definition of Terms
The following terms were
operationally defined.
Performance: An effort towards achieving a
desirable end. It also shows the outcome of work done or carried out by people.
Performance in this study may refer to input – output function.
Appraisal: making a fair assessment of
individual contributions or efforts. It is the evaluation of job performance.
Performance Appraisal: Performance
appraisal has been described as “the process of identifying, observing,
measuring, and developing human performance in organization.
Growth: achieving better rate of return and rising
share market the assets.
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