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EFFECT OF PERFORMANCE APPRAISAL
IN IMPROVING PRODUCTIVITY
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
purpose of writing this project is to investigate into how performance
appraisal can enhance increased productivity in Union Bank Nig Plc. The study
will among other things try:
i.
To find out the various performance
appraisal techniques used.
ii.
To examine the implications of
performance and productivity.
iii.
To provide bases for reward employees
in relations to their contribution to the organization.
iv.
To identify some common appraisal
problems of employees and how proper appraisal can enhance increased
productivity.
v.
To make some used recommendations to
management.
1.4 STATEMENT
OF HYPOTHESIS
A
hypothesis is a conjectural statement of relationship between two or more
variables. They are always in declarative sentence form, and they relate either
generally or specifically, variable or variables. They are particularly
necessary in the studies of this nature where cause and effect relationships
are to be discovered.
H1: Performance
appraisal techniques provide formal management procedure used in the evaluation
of work performance in the organization.
H0: Performance appraisal techniques do not provide formal management
procedure used in the evaluation of work performance in the organization.
1.5 SIGNIFICANCE
OF THE STUDY
i)
The study is of vital importance to
organization’s effectiveness, hence the result will be useful to the
organization in developing effective and efficient performance appraisal plans
and programmes to aid the organization in its goals attainment.
ii)
The importance of this study
therefore is to research into those benefits that performance appraisal could
bring to the organization, employer and the employees alike.
iii)
The study could also be valuable as
source of reference to students of management studies who mighty carry out
similar or further research in this area.
iv)
The study will help the researcher to
fulfill the requirement for the award of HND in management studies.
1.6 SCOPE
OF THE STUDY
The
study would squarely concentrate in analyzing performance appraisal techniques
in Union Bank Nig Plc. The researcher has related the study only to the areas
that are related to the topic such areas are: performance appraisal, techniques
for performance appraisal.
1.7 LIMITATION
OF THE STUDY
In
a developing country like Nigeria, students are normally faced with grave
shortage of relevant facts necessary for their research work and mine is not an
exception.
However,
confidence and ability are best assets every human being must possess. The
following are some of the constraints encountered during this project work.
1.
Insufficient Textbooks and High
Price Tags: In Nigeria nowadays, in purchase good
and comprehensive textbooks for reading to further research on a typical
issues. It will cost an average of three thousand naira and an average student
cannot lay their hand on it as a result of the economic situation.
2.
Time Factor:
In this part of the country and due to classroom lecturers, it often hinders
someone to concentrate more one it project writing because part of the time are
used in classrooms and to further participate in classroom group discussion and
assignments.
3.
Finance:
This project work involves huge financial expenses such as photocopy, typing
and movement from one point to another to gather information. The financial
problems not only hindered movement but also discourse ones enthusiasm in
learning.
4.
Personal Limitations:
Personal time available for recreation resting and washing are partly engulfed
by this study in attempt to beat the expiration time for submission.
1.8 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.
1.9 DEFINITION
OF TERMS
Ø Performance
Appraisal: It is a process or series of
formalized discussions with an employee about performance over a specified
period of time.
Ø Manager:
A person with the task of planning, organizing, directing, coordinating and
controlling organization’s resources to attain the objectives of the
organization.
Ø Productivity:
It is the “quantity or volume of the product or service that an organization
provides” (Decenzo and Robbins, 1989).
Ø Effectiveness:
This is concerned with the art of getting the right things done, in the right
way, at the right time and for the right purpose.
Ø Efficiency:
It is concerned with achieving an objective or producing product at the least
cost to enhance organization achieves the main objective.
Ø Organization:
An enterprise established by a person or group of individuals; government in
order to provide goods and services for the satisfaction of human needs.
Ø Management:
This is the process of planning, organizing, directing and controlling both
human and non-human resources effectively and efficiently towards the
attainment of organizational goal.
CHAPTER TWO
REVIEW OF RELATED LITERATURES
2.1 INTRODUCTION
Studies
have shown that no organization can develop without the existence of systematic
appraisal. A good performance appraisal is the one that helps employee to know
his or her stand in the company.
Performance
is the degree of accomplishment of the tasks that make an individual’s job. It
is often confused with efforts which refers to energy expended. However,
performance is measured in terms of results and combination of three factors –
efforts, ability and direction makes the quality of performance.
According
to Rue and Byars (1982: 13), effort refers to how hard a person works, that is,
the amount of energy (physical or mental) used by an individual in performing a
task, while ability is concerned with personal characteristics used in
performing a job. And direction refers to how well the person understands what
is expected of the job.
Peter
Drucker (1983:41) in his book, Management: Tasks, Responsibilities and
Practices, opined that it is the “test of an organization to make ordinary
human beings perform better than they seem capable of”. Wendell French (1979:7)
in discussing performance appraisal, observed that it is an attempt to provide
data about past, present and expected future performance so that appropriate
decision can be made. He also argued that although appraisal tends to be taken
place somewhere within the organization at any moment in time. Systematic
performance appraisal of an individual employee are likely to occur at
intervals throughout the person’s employment.
According
to Rue Byars (1982:161) performance appraisal is a “process that involves communicating
to an employee how he is performing the job and ideally involves establishing
plan for improvement”. He viewed the use of performance appraisal in
organization as promotion and demotion, transfer, layoffs, discharge,
counseling with employee, human resource planning and wage and salary
administration.
Decenzo
and Robins (1989: 358) viewed performance appraisal as designed for three
purposes. First, it can be used as a basis for reward allocations. Decisions as
to who get salary increases, promotion and other rewards are determined by
their performance evaluation. Secondly, these appraisal can be used for
identifying areas where development efforts are needed. Management need to spot
those individuals who have specific skill or knowledge deficiencies.
Performance appraisal is major tool for identifying those deficiencies.
Finally, it can be used as a criterion against which selection devices, and
development programs are validated. Thus, developing a valid, reliable and
bias-free performance appraisal system can establish a satisfactory standard.
Unfortunately,
environmental factors like inadequate work facilities, poor working conditions,
lack of cooperation in the department affects the performance of the employees.
The above factors should be eliminated by the Supervisor and what is expected
of the employees must be effectively communicated to them.
2.2 PRINCIPLES
GUIDING PERFORMANCE APPRAISAL
One
ailment that is constantly riddled in Nigerian companies is the issue of
godfatherism or man-know-man. The element of patronage relationship has
jeopardized any meaningful attempts at objective evaluation of performance.
This factor has led to nepotism in different companies in Nigeria. It follows
from what is said above that appraisals should focus purely on the level of
performance of the employee on the job, rather than on his patronage and ethnic
origin. In Nigerian companies, the allocation of post is based on quota or the
federal character principle has negated the merit system of administration. One
is recruited to his state of origin.
Closely
linked to this is personal prejudice. An effective appraisal system should be
devoid of any traces of bias, or hostility. To ensure this fairness, it has
been suggested that appraisal should if possible be reviewed by the peers of
colleagues of the appraisee as well as his appraiser’s boss.
A.K.
Ubeku (1984) in his book “Personnel Management in Nigeria” is of the view that
nationality is achieved if every individual worker is made to realize the
target that he is expected to meet and the time limit and then appraise him or
his performance without bias.
2.3 CONCEPT OF PERFORMANCE APPRAISAL
The
idea behind performance appraisal is not merely to find out what someone’s
performance is worth, but equally to find ways of making it worth more. In the
organizations that make up our complex and fast changing economy, nothing counts
more than what people do at work. Helping them to do it better is what
performance appraisal is all about.
Effective
performance involves confrontation. It requires facing up to disagreement and
conflict. Many supervisors have trouble managing confrontation. Others do not
even try to manage it, they simply squelch any views that differ from their
own. Effective performance appraisal takes time because it cannot be done in 10
or 15 minutes. So many impatient superiors do slapdash appraisals that may do
more harm than good. Effective performance appraisals requires skills, and many
appraisals are messed up by appraisers who know little or nothing about
appraising.
In
every organization, some managers do a good job of appraising the performance
of their subordinate by discussing the evaluation with them as a means of
helping them to improve their work and their changes for promotion. Often,
there is no uniformity among divisions and departments. Therefore, the company
desired to appraised management performance and identify individuals who show
greatest potential for higher managerial positions.
For
instance, performance appraisal is not confined to management positions only,
it is used by many firms in evaluating the performance of non-supervisory
employees (Pigor and Myers (1983:77).
Indeed,
performance appraisal systems vary considerably. There has been disagreement
over the most effective approach to stimulating improved managerial
performance. This controversy reflects different personnel concepts of management.
Under management by centralized direction and control, appraisals are made by
higher-level manager, sometimes in consultation with other superiors at the
same or higher level and communicated to subordinate managers. However, there
is little opportunity for two-way communication on managerial performance.
Managers are told where they stand and what they must do to move ahead.
2.4 OBJECTIVE
OF APPRAISAL
The
main purpose of performance appraisal is to improve the overall efficiency of
an organization by trying to get the best of the individuals working for it.
Within these concept therefore, performance appraisal schemes are used for
specific purposes:
1.
The scheme provides an opportunity
for the managers and his subordinates to review the latter’s work in the light
of set objectives. The employee is, thus told how well he has performed on the
job (Luthans, 1986:245).
2.
According to Pigers and Myers
(1981:289), appraisals have been frequently used as a basis for selecting
candidates for promotion to better jobs and for making ‘merit increase in
hourly rates or salaries”.
3.
Performance appraisal is also used as
a check on the success of recruitment, selection, placement and training
procedures. Appraisal of probationary employee can help determine if they
should be retained or not at the end of 30 to 60 days period for new employees.
It is also used as a means of assessing how much increment in salary a worker
is to get in comparison to his colleagues. The belief here is that output level
varies directly with increment in salary and fringe benefits.
4.
Another aim is to satisfy the
individuals needs; by knowing what the organization thinks of the employee. To
have guidance for self-development; to discuss his or her performance with
superiors and seek ways of improving it, to be satisfied that future
development and career potential are given proper consideration.
5.
Performance appraisal indirectly aims
at bringing the manager close to his subordinates. The worker thus acquires a
sense of belonging and consequently is more committed to the organization. It
is an established principle of management that the supervisory manager must
know his subordinates intimately; not just part of him but the whole him.
Therefore, continuous contact, observation and discussion between managers and
appraisees are encouraged.
6.
The continuous nature of the
appraisal scheme makes for the employee’s optimum performance since the
employee can now tell when his efficiency rises or drops. Therefore, managers
must not wait for twelve months before writing reports in December.
2.5 APPRAISAL
PROCESS
According
to Decenzo and Robbins (1989:361), appraisal process begins with the
establishment of performance standards. These should have evolved out of job
analysis and job description. The performance standard should also be clear and
objective enough to be understood and measured. And there must be a
clarification of the expectations of the workers. Underlying the system is the
belief that one cannot evaluate performance objectively without knowing exactly
what performance levels are required and expectd of the workers. It becomes
essential, therefore, to figure out and write down in specific language the
kind of performance and types of results that are expected. Actual performance
can then be measured against them.
For
instance, Decenzo and Robbins (1989:361) observed that once performance
standard are established, it is necessary to communicate these expectations. It
should not be part of the employee’s job to guess what is expected of them. It
is unfortunate that too many jobs have vague performance standards. The problem
is compounded when these standards are not communicated to the employee. It is
important to know that communication is a two-way street. Communication only
takes place when the transference of information has taken place and has been
received and understood by the subordinate. Therefore, feedback is necessary
from the subordinate to the manager. Satisfactory feedback ensures that the
information communicated by the manager has been received and understood in the
way it was intended.
Appraisal
Process Chart
1.
Establish
performance Standard
2.
Communicate
performance expectation to employee
3.
Measure
actual performance
4.
Compare
actual performance with standard
5.
Discuss
the appraisal with the employee
Source: Decenzo
and Robbins, p. 362.
The
third step in the appraisal process is the measurement of performance. To
determine what actual performance is, it is necessary to acquire information
about it. The company should be concerned with how it measure and what it
measures.
However,
to measure actual performance certain information are used by managers and some
common sources of information are personal observation, statistical reports,
oral reports and written reports. Each of these has its strength and
weaknesses, a combination of them increases both the number of input sources
and the probability of receiving reliable information. What we measure is
probably more critical to the evaluation process than how we measure, since the
selection of wrong can result in serious dysfunctional consequences. And what
we measure determines, to a great extent, what people in the organization will
attempt to excel at. When we tell an employee that she will be evaluated on
criterion X and appraise her performance base on criterion Y, we can expect to
do a good job to decline.
The
fourth step in the appraisal process is the comparison of actual performance with
standards. The attempt in these steps is to note deviation between standard
performance and actual performance.
The
final step in appraisal process is the initiation of corrective action when
necessary. Correction action can be of two types – one is immediate and deals
predominantly with symptoms. The other is basic and delves into causes.
Immediate corrective action is often described as “putting out fires”, whereas
basic corrective action gets to the source of deviation and seeks to adjust the
difference permanently (Decenzo and Robbins, 1989:364).
They
further argued that immediate action corrects something right now and get
things back on track. Basic action asks why and how performance deviated. In
some instances, managers may rationalize that they do not have the time to take
corrective action and therefore must be content to “perpetually put out fires”.
Good managers should recognize that they must find the time to analyze
deviations and, in situations where they benefit justify such action, permanently
correct significant differences between standard actual performance.
2.6 ADMINISTERING
AN APPRAISAL PLAN
Piger
and Myers (1983:289) viewed performance appraisal as ultimately a
responsibility of line management, to be met with the assistance of the personnel
administrator and his or her staff. Almost any plan will be worthless if it
lacks the support of management, or if supervisors are poorly trained in
systematic appraisal or unconvinced of its value or equally if discussion of
results with employees is boldly handled, or if appraisal are not honesty used
for the purpose intended.
These
and other difficulties often prevent the successful operation of a systematic
programme. Pigor and Myers assert that these may be avoided if the personnel
administrator helps management by taking the following steps:
1.
Secures full agreement of line
management on the need for a formal performance appraisal plan on the purposes
for which it be used. A choice has to be made among several types of appraisal
plans:
a.
Point system the weights for each
other;
b.
Non-point system with a chart or form
describing the factors to be appraised;
c.
The rank-order, paired comparison, or
forced-distribution method, in which each supervisor ranks employees on overall
performance or divides them into groups, such as the top 10%, the next 20%,
etc;
d.
The field review method in which the
performance of each employee is reviewed in detail by supervisor with the help
of the personnel department;
e.
Appraisal by results of objectives.
2.
Study plan of other companies and
existing literature on the subject to develop a plan best suited to the needs
of the particular organization. Complicated plans should be avoided, in our
judgment, point system are open criticism because of their complexity. Ratings
in not more than four categories for each factor (example outstanding, good,
satisfactory, unsatisfactory) are preferable, because points numerical weights
suggest a degree of accuracy that is not possible in subjective employees
performance appraisal. Much depend, however, on how the appraisal plan has been
developed and how carefully the rater have been trained.
3.
Enlists the cooperation of
supervisors in drawing up the appraisal form, including discussion to the
approach to be used and uniform descriptions or instructions to be followed.
4.
Provide or secure careful training of
the supervisors, in order to get unbiased, uniform appraisals of the employees.
Progress in rating will be almost directly proportionate, at least in the early
stages of the programme to the amount of intelligent effort expended to improve
the ability of the individual raters.
5.
Achieve link and staff coordination
and mutual checking of the employee performance appraisal, in order to get
consistency and uniformity within and between departments. In a large
metal-trade company, there was much employee dissatisfaction because in one
department, a point rating of 75 was “excellent” whereas took 90 in another
department to be considered. Coordination of appraisals through group
discussions between the personnel administrators and superintendents can help
to minimize each discrepancies.
6.
Arrange for periodic discussion of
performance appraisals by the supervisor with each subordinate. Good points
should be stressed, difficulties pointed out, and better performance
encouraged. All employees have the right to know from their supervisors on how
they are getting along, and good supervisor will let them know more frequently
than at the formal appraisal review. The appraisal discussion should be in the
nature of a progress review with an opportunity for employees to respond if
they feel differently about their job performance.
All
in all, a systematic appraisal plan helps supervisors to review the performance
of their employees. This is probably the greatest value to any organization.
Management should participate from the start in the development of the
programme, for it is management responsibility to evaluate employee
performance. The personnel officer should clearly remain in a staff capacity.
2.7 METHODS
OF APPRAISAL
There
are many methods of performance appraisal. There is no general method
appropriate for all purposes. The problem of management is to determine what
kind of performance appraisal method is adequate, given the purposed to be
served.
a)
Trait
Checklist
Here
the rater uses a list of behavioural description and check off behaviours that
apply to the employee.
Sample of Checklist Item in
Appraisal
1.
Are supervisors’ orders usually
followed? Yes/No
2.
Does the individual approach
customers promptly? Yes/No
3.
Does the individual lost his or her
temper in public? Yes/No
4.
Does the individual keep busy when
not serving customers? Yes/No
5.
Does the individual volunteer to help
the employee? Yes/No
Once
the checklist is complete, it is usually evaluated by the staff personnel
department, not the manager doing the checklist. Therefore, the rater does not
actually evaluate the employee’s performance, he or she merely records it. An
analyst in the personnel department then scores the checklist. The final
evaluation can then be returned to the rating manager for discussion with the
subordinate. The example of trait, according to Luthan et al, that frequently
appear on such forms are neatness, ingenuity, initiative, ability to follow
instructions promptly, and ability to get along with co-workers.
Advantages
Checklist
method reduces some bias. It is easy to install and administer since relatively
few forms are commercially available. In fact, all employees are rated on the
same factors and on the same scale. Checklist method is suited to anniversary
date.
Disadvantages
The
trait checklist is general and not related specifically to job performance. In
this method, they are particularly susceptible to varying standards of
comparison being used by various raters. The tendency of those using this
method is to focus on personal characteristics rather than job performance
results. And the factors rated are general, there is a tendency for ratings to
reflect the “halo effect”.
b)
Graphic
Rating Scale
Graphic
rating scale is the most popular method of appraisal. It is used for assessing
factors such as quantity and quality of work, job knowledge, cooperation,
loyalty, dependability, attendance, honesty, integrity, attitudes and
initiative. However, this method according to Decenzo and Robbins (1989, p.
367) is most valid when abstract traits like loyalty or integrity are avoided
unless they can be defined in more specific behavioural terms. The assesses
goes down the list of factors and notes the point along the scale that best
describes the employee. This is often rated alongside the tradition method. The
advantage of scaling is that there is more flexibility.
Graphic
Rating Scale
Employee’s
Name: Date:
Evaluator’s
Name: Period of
Evaluation:
Directions: Circle the point on each scale which best approximates the
employee’s performance.
|
|
Poor
|
Below
Average
|
Above
Average
|
Excellent
|
|
Job
knowledge
|
|
|
|
|
|
Quality
of work
|
|
|
|
|
|
Quantity
of work
|
|
|
|
|
|
Co-operation
|
|
|
|
|
|
Company
loyalty
|
|
|
|
|
|
Customer
courtesy
|
|
|
|
|
|
Ability
to learn
|
|
|
|
|
|
Dependability
|
|
|
|
|
|
Safe
habits
|
|
|
|
|
|
Ability to follow direction
|
|
|
|
|
c)
Forced
Choice
Luthan,
et al (1979:48) looks at force choice as a process whereby the supervisor
evaluate an employee’s performance on the basis of the categories of traits
listed under the trait method, but the supervisor is forced to make a yes or no
judgment.
In
this checklist, the rater has choice between two or more statements, all of
which may be favourable or unfavourable. The appraiser’s is to identify which
statement is most descriptive of the individual being evaluated.
Decenzo
and Robbins (1989:368) gave advantages of forced choice method by viewing that
since the appraiser does not know the right answers, it reduces bias and
distortion. The appraiser may, for example, like a certain employee and
intentionally want to give her favourable evaluation, but this becomes
difficult if one it not sure which responses is most preferred.
On
the negative side, this method tends to be disliked by appraisers. Many do not
like being forced to make distinctions between statements that are difficult to
differentiate amongst them. Raters may also become frustrated with a system
where they do not know what represents a “good” or “bad” answer.
Forced
Distribution of Employee
Department………………………… Supervisor…………………
Date………………………………….. Period of Evaluation……..
Directions: Begin with the excellent classification
then processed to the above average, etc. List names of the employees who fall
into the classification; the total number within each category may not exceed
the percentage allowance for the classification.
|
Poor
|
Below Average
|
Average
|
Above Average
|
Excellent
|
|
10%
|
20%
|
40%
|
40%
|
10%
|
|
- Ward
- Johnes
|
- Lickting
- Ehlercoe
- Elbert
|
- White
- Jones
- Tyan
- Sharbrough
- Dean
- Brown
- Alexander
- Henderson
|
- Meeham
- Smith
- Nelson
|
- Vahaly
- Wilber
|
d)
Essay
Appraisal
Decenzo/Robbin
viewed essay appraisal method as the simplest of appraisal where the rater
rights a narrative description of an employee’s strength, weaknesses, past
performance, potential and suggestions for improvement.
The
strength of the essay appraisal lies in its simplicity, it requires no complex
forms. It can be a letter written by former employers, teachers or associates
concerning an individual’s qualifications and past performance. However, the
essay appraisal can provide considerable information, which can be fed and
assimilated by the employee.
e)
Critical
Incident Appraisal
Here,
the rater’s attention is focused on those critical behavoiurs that make the
difference between doing a job effectively and doing it effectively. They write
down little anecdotes that describes what the employee did that was especially effective
or ineffective. The strength of the critical incidents on a given employee
provides a rich set of examples from which the employee can be shown which of
his or her behaviours are desirable and which one call for improvement.
Its
disadvantage is that appraisers are required to regularly writes this incidents
down, but doing this on a daily or even weekly basis for all of their
subordinates is time consuming and burdensome for managers. Secondly, critical
incidents suffers from problem of comparison and ranking of subordinates.
f)
Paired
Comparison
According
to Carmel and Kuzmits (1982:250), paired Comparison is where each employee is
being given a positive comparison total and a certain percentage of the total
positive evaluation. This percentage of positive comparison gives the paired
comparison technique an advantage over the ranking forced distribution methods
like the ranking and forced distribution technique, paired comparison is quick
if few employees are involved and fairly easy to use. However, supervisors
prefer paired comparison to ranking or forced distribution because they compare
only two employees to each other.
The
disadvantage of paired comparison is that employee are simply compared to each
other on total performance rather than specific job criteria.
g)
Management
By Objective
According
to John Humble (1979:36) management by objective has induced a move to
result-oriented approach to assessment stemming from the basic axiom that
managerial effectiveness is the extent to which he achieves the output requires
of his position. In favour of MBO is the fact that such systems are based on facts
about what he appraiser actually did and the target objectives he is assessed
on are the ones which have been agreed between himself and the assessor at the
start of the assessment period. The difficulty lies in deciding what yardsticks
to use a measure of performance and upon which to set objectives. In banking,
many of the agreed targets and key tasks are not within the absolute control of
the appraiser. Time changes circumstances and in turn the agreed targets – it
is consequently difficult to disentangle the two. Moreover, quantitative
targets are of doubtful value in service department where quality standards are
obtained.
Assessment
centres have a further role to plan in this connection where the employee
assemble in other to undertake group task under observation. These lay greater
emphasis on assessing potential rather than past performance.
Studies
now observed that it is necessary to give a clear idea of where they stand in
the organization’s opinion and this is not easy; research has shown that
interviews tend to leave interviewees with an over-optimistic view, especially
of their promotion prospects.
Advantages
Management
by Objective (MBO) focus directly on the achievement of business results, not
the personal characteristics that may contribute to results. The annual
establishment is agreed plan business and personal objectives adjusts the
programme to changing business needs and personal development requirement.
Disadvantages
In
Management by Objective, each employee is rated on different factors and on
different scales. Furthermore, the system in susceptible to the use of varying
standards to establish performance objectives. The MBO approach is very
difficult to install in goal setting and subject to all the difficulty of
forecasting.
2.8 APPRAISAL
INTERVIEW
Appraisal
interview is an important aspect in assessing employee. In this context, it is
important that both supervisor and employee communicate their perception of the
employee’s performance. They should look at the job and the future rather than
personality and the past. The emphasis should be on development rather than on
appraisal.
According
to Luthan (1978), the decision a supervisor has to make in the appraisal
interview is whether to be participative or directive. In any interview, the
participative style encourages the employee to take part. In general, the
participative interview technique has proved more effective than the directive
technique in increasing the employee’s motivation and improving performance.
During
a directive type of interview, the supervisor tells the employee about his or
her performance. Researchers have viewed that the more directive the appraisal,
the less effective it is in improving performance. Luthan’s et al (1979:254),
recommended that the participative style be used in most circumstances.
However, during the interview the employee may review his or her own
performance and offer suggestions for improvement and development.
In
fact, any successful appraisal interview should look at the following points:
i)
The purpose of the interview should
be well understood by both parties;
ii)
Thorough preparation is undertaken by
both parties;
iii)
A favourable setting for the
interview is arranged;
iv)
The interview should follow a
pattern;
v)
A “problem solving” approach should
be adopted.
What Distort Performance
Appraisal
Performance
appraisal process and technique presents an objective system in which the
evaluator is free from personal bias, prejudices and idiosyncrasies.
In
spite of our recognition that a completely error-free performance appraisal can
only be an idealized model, with all actual appraisals being something less
than this optimum, we can isolate a number of factors that significantly impede
objective evaluation.
Leniency Error
Every
evaluator has his or her own value system which acts as a standard against
which is appraisals are made. Relative to the true or actual performance an
individual exhibits, some evaluators mark high and others low. When evaluators
are positively lenient in their appraisal, an individual performance becomes
overstated that is rated higher than it actually should. Similarly, a negative
leniency error understate performance, giving the individual a lower appraisal.
According
to Decenzo and Robbin (1989:376), if all individuals in an organization were
appraised by the same person, there would be no problem. Although there will be
an error factor it would be applied equally to everyone. The difficulty arises
when we have different leniency errors making judgments. Assume a situation where
both Jones and Smith are performing the same job for a different supervisor,
but they have absolute identical job performance. If Jone’s supervisor tends to
err toward positive leniency while Smith’s supervisor err towards negative
leniency, we might be confronted with two dramatical different evaluations.
Halor Error
According
to Bernadin and Beatly (1987:140), the Halo Effect or Error is a “tendency to
rate high or low on all factors due to the impression of a high or low rating
on specific factor”. For example, if an employee tend to conscientious and
dependable, we might become biased toward that individual to the extent that we
will rate him or her high on many desirable attributes.
People
who design teaching approval forms for College students to fill out in
evaluating the effectiveness of their instructor each semester must confront
the Halo Effect. Students tend to rate a faculty member as outstanding on all
criteria when they particularly appreciative of a few things he or she does in
a classroom.
Similarity Error
When
evaluators rate people in the same way that the evaluators perceive themselves,
they are making a similarity error. Based on the perception that evaluators
have of themselves, they project those perceptions onto others. For example,
the evaluator who perceives himself or herself in aggressive may evaluate
others by looking for aggressiveness. Those who demonstrate this characteristic
tend to benefit, while others are penalized.
Low Appraiser Motivation
What
are the consequences of the appraisal? Bernadin and Beatly (1987:270), viewed
that if the evaluator knows that a poor appraisal could significantly hurt the
employee’s future particularly opportunities for promotion or salaries
increases, the evaluator may be reluctant to give a realistic appraisal. There
is evidence that it is more difficult to obtain accurate appraisals when important
rewards depend on the result.
Thomas
Decotilis and Adre Petit (1987:635), argued that performance appraisals are
used as the determinants for rewards may be viewed as analogous to the
proverbial forward pass in football.
Ongoing Feedback
Employees
like to know how they are doing. The “annual review” where the manager shares
the subordinate’s evaluations with them may become a problem. In some cases, it
is a problem merely because managers out off such reviews. This is particularly
likely if the appraisal is negative. But the annual review is additional
trouble if the manager “save up” performance-related information and unloads it
during appraisal review. This creates an extremely trying experience for both
evaluator and employee. In such instances, it is not surprising that the
manager may attempt to avoid confronting uncomfortable issues which even if
confronted, may be denied or rationalized by the subordinate (Henderson,
1989:284).
The
solution lies in having the manager share with the subordinate both
expectations and disappointments on a day-to-day basis. By providing the
employee with frequent opportunities to discuss performance before they reward
or punishment. Consequences occur, there will be no surprises at the time of
the annual formal review.
2.9 RESPONSIBILITY FOR DECREASED AND INCREASED
PRODUCTIVITY IN RELATION TO PERFORMANCE
Employees
are performing well when they are productive. Yet productivity itself implies
both concern for effectiveness and efficiency.
“Productivity
is the quantity or volume of the major product or service than an organization
provides” (Robbins, 1983:22). In other words, it is the amount of work that is
being performed in the organization… in terms of how much and how well.
According to Decenzo and Robbins (1989:9) high productivity is what makes an
organization thrive. Without a good product or service to sell, problems in an
organization are sure to arise. Accordingly, productivity improvement
programmes are becoming more popular with organizations.
Productivity
is contingent on an employee motivation, the best trained employee, one who not
only has the ability but has access to the most advance piece of equipment,
will not be productive if he or she is unwilling to be so. Attitude plays an
important role as whether individual as the propensity to work. Accordingly, to
increase productivity we must, in fact, chance an employee’s attitude or in
academic terms, increase his or her morale. According to Walker (1980),
employees are motivated to perform, to develop personal capabilities and to
improve performance and productivity.
While
productivity improvements can be achieved through a series of events – proper
equipment, increase motivation – one common threat exists. That threat is a
worker’s ability to accept and implement changes. High performance depends on
both ability and motivation. Many employees with extra-ordinary talents do not
perform satisfactorily because they will not exert the necessary effort.
Therefore,
we desire to have capable employees who are highly motivated. If a person is to
perform effectively, extrinsic factors such as job design, working conditions,
job security and supervision must be seen as satisfactory. Many people also
look for intrinsic factors such as achievement, recognition and responsibility
from their work. For individuals who place high value on intrinsic factors, the
absence of this factors can reduce one’s willingness to exert high degree of
effort.
The
greater the output of a given input, the more efficient is the production process.
Similarly, if output is given, the lower input consumed to get that output
results is greater efficiently. It is most desirable to have objective measures
of productivity, this consists of efficiency as well as effectiveness.
Performance also includes personnel data such as measures of accidents,
turnover, absences and tardiness.
That
is a good employer is one who not only performs well in terms of productivity
but also minimizes problems for the organization by going to work on time, by
not missing days and by minimizing the number of work related accidents. More
widespread, but possibly less effective in eliciting employees participation in
productivity improvement are the profit-sharing movement, employee stock
purchase plans, and employee suggestion systems.
Genuine
employee interest and participation in increasing productivity are probably not
achievable through any specific technique or system. When any system is
successful, the common goal of a productive enterprise or organization.
2.10 IMPLICATION
OF PERFORMANCE AND PRODUCTIVITY IN MANAGEMENT
The
challenging opportunities that are inherent in every industrial organization
for people to assume responsibility, achieve status, acquire new skills, learn,
develop and exercise creativity become apparent once this area of collaboration
is carved out. The idea that workers are paid to do what they are told and
management is paid to tell them not only to prevent effective collaboration but
automatically creates the feeling of psychological failure. It leaves either to
indifferent positivity or to active hostility. Genuine participation problem
solving removes the causes of these common reactions (Douglas McGregor,
1988:92).
As
productivity has increased, gained have been shared with employees through
general wage and salary increases, pay incentive systems and other methods. But
how to share these gains in a way that will develop an enthusiastic and willing
workforce is a persistent problem for management. Should all gains go to
employees, or only some proportion? How can we measure the gains in
productivity? What approaches and what methods of gain sharing will encourage
employees towards higher productivity? These are among the perplexing questions
which continue to face management. Members of line management and staff
specialists, such as personnel administrator and the industrial engineer, need
to be informed on possible approaches in dealing with these continuing
problems.
Employee
interest in higher productivity does not develop without some stimulation by
management, either directly or through the creation of an atmosphere in which
the employees want to contribute their best efforts to the job. Too often in
the past, employees (and their unions) had felt that higher productivity
benefited someone than themselves. Often, they have not been convinced that
there is a direct relationship between higher productivity, and lower costs and
increased on the one hand and more job security and higher wage or salary
incomes on the other hand.
The
measurement of labour productivity is the increase in output resulting from all
factors that contribute to the reducing balour input per unit of output better
and more efficient machinery, better work-flow, reduced waste, improved
processes, more skilled workers, and increased efficiency and efforts by
workers of the same skill. The latter may be relatively less important, because
historically the largest increases in the output per production employee hour
have occurred because more and better machinery that is capital was introduced
by management in the capital labour mix.
When
productivity measurements are available for a particular industry, there are
good reasons for not precisely adjusting wage and salary charges in that
industries to charge in the industry’s labour productivity index. If these were
done for each industry wages and salaries would be increased when an industry
productivity was unchanged or falling. It is true that wages and salaries are
higher in those industries which have experienced the greatest increases in
labour productivity, such as air transportation, utilities, telephone
communications, and petroleum refining, among others. Thus, management and
unions have tended to negotiate agreements that share some of the increased
productivity gains in such industries with the employees of such industries.
If
higher productivity industries are also expanding industries and need to
attract more labour, then economists would agree that higher wages and salaries
are necessary for optimum allocation of labour. But this allocation function is
not always involved in wage decisions.
Process
affecting Individual Productivity
|
LOW
Pressure
from Foreman
Desire to
do four days work
Desire for
promotion
Fears for
loss of job
Egostic
drive to accomplish
|
HIGH
·
Resentment of management
·
Social pressure of group set rate
·
Fear of rate change
·
Reluctant to work too hard
·
Fear of working self out of work
|
Management
and stockholders have benefited from lower costs, better ality and less need
for supervision. Management’s job under a plan of this sort is not easy, but it
is different. Management official must “keep on their toes” to plan work ahead
and arrange for an adequate flow of orders and materials to the workplace.
Thus, the planning function of management is increase. Directing the workforce
and giving orders are less difficult, since real teamwork and self-discipline
have developed.
Success
is usually not due to hardwork from any group of employees. Savings results
from suggestion to eliminate wastes to reduce the number of operations
required, or to coordinate the work of groups of employees.
For
example, in a book publishing plant, a press room worker found that some ink
companies would process waste ink and return it in usable form at a cost of N10
to N15 as compared with N50-N95 for row ink. His suggestion in a committee
meeting resulted in considerable saving. A bindery who was a member of a
production committee suggested stacking word in a different manner in order to
save floor space in an outside warehouse. This space was worth N50 a square
foot.
In
another firm, that did machine shop and sheet-metal machine operations on a
job-shop basis, new methods of cooperation and cost reduction developed. Each
mechanic agreed to pool his own figs and fixtures (formally jealously guarded)
and to share his ideas with fellow mechanics to reduce the time necessary to
complete orders.
Critics
may say than an efficient manager would have made these changes without the
benefit of employee suggestions through a joint labour management committee.
But the fact is that the actual level of efficiency in many firms is below the
optimum level. This is so partly because employees are neither motivated to
produce as a part of work group nor convinced that higher output will be to
their benefit as well as to the company.
CHAPTER THREE
RESEARCH METHODOLOGY
3.0 INTRODUCTION
In
order to find solution to any problem or issue at any point in time, there is
need of gathering relevant information which will form the basis for conclusion.
3.1 RESEARCH
DESIGN
In
carrying out a study of this kind, a lot of information has to be put together
and analyzed, extensive research is very necessary and importantly this is
because the success of the research work depend largely on how well, the
instrument used in gathering data were being design.
According
to Kelinger (1966) defined research design as the plan, structure and strategy
of investigation concerned to obtained answer to research questions and to
control variance. Thereby, the format employed to accomplish the systematic
application of the scientific method of investigation problem are:
Random
sampling via the questionnaire which was used for data collection from the
respondents in order to confirm hypothesis.
3.2 RESEARCH
POPULATION
The
population of the study refers to the total number of staff of First Bank Plc,
Kaduna branch the size of the population is relatively large, is said to be
about 360 including senior and junior staff respectively. This population would
provide the most authentic and dependable data necessary for the research, this
is the generalization from the study can be validly applied.
3.3 SAMPLE
SIZE AND SAMPLING TECHNIQUES
This
is the selection part of an aggregate population to represent the whole aggregate
in view of the large size of population of the study.
The
method used in that of Roscoe (1975) who seems to use 10% as rule of ‘thumb’
acceptable levels.
Therefore,
the researcher used the sample size of fifty six (56) questionnaire which were
administration but only fifty (5) were returned.
Random
sampling techniques were employed in the selection o avoid bias in the courses
of carrying out the research.
3.4 METHOD
OF GATHERING DATA
The
source and method of collection of data was approached from different angles,
which include primary data obtained through structural questionnaires for
analytical purpose, secondary data which consist of relevant textbooks,
journals and other publishing work to supplement the primary data.
3.5 JUSTIFICATION
OF METHOD USED
The
method used for data collection is questionnaire method. Questionnaire is
simply a formalized schedule to obtain the record specified and relevant
information in with tolerable accuracy and completeness. However, it advantage
are as follows:
·
It permits wider coverage at minimum
cost
·
It can be documented and kept for
reference purpose
·
It promotes much time for thought and
careful study of the questions before answering the question.
·
It has high possible way of gathering
the truth most especially form the employees.
The
disadvantages are considered as follows:
·
Problem of non-return of
questionnaire
·
It is difficult for the researcher to
follow-up the greater insight from replies.
3.6 METHOD
OF DATA ANALYSIS
The
techniques used by the researcher in this study for analyzing data were based
upon the use of percentage and scaling to extensively enable a clear
understanding and to indicate the comparison of certain figures or responses.
From this percentage and scaling system, one can deduce the result from the
highest respondents which signifies and shows the current trend and alternative
to its multiple answers provided. Therefore, the method of data analysis
adopted in this work or study are the percentage tabulation scaling method and
descriptive method.
3.7 JUSTIFICATION
OF INSTRUMENT USED
The
percentage tabulation, scaling method and descriptive method were used because
the instrument makes it easier for the tabulation of the alternative response
of each choice and also the respondents are all literate.
Also
the researcher employed chi-square for the test of hypothesis. This is because
the study aims to analysis the impact of human relation in banking industry.
The
chi-square is a statistical calculation used to test how well the distribution
of a set of observed data matches a theoretical probability distribution in the
formula.
Where: c2 = Chi-square
O = Observed frequency
E = Expected frequency
∑ = Summation
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