1.1 Introduction
Performance appraisal is a systematic evaluation of the performance of an employee on his present job and also in relation to future jobs that he may be required to take up (Hartzell, 2006). It measures and evaluates the results of the performance of workers pointing out their potentialities and deficiencies so that they can improve over time. A good appraisal system is so fundamental to the management of people in any organization. The success of the organization itself depends largely on a good appraisal system. With a good appraisal system those who contribute more will be adequately rewarded and the right type of people are likely to be promoted into positions of higher responsibilities (Stonner, Freeman & Gilbert, 2005).
As a prelude to other parts of this study, this chapter will discuss the background upon which this study was initiated, the statement of problems that led to this study, the Aim and Objectives of the study. Others are Significance of the study, Scope of work, Research hypothesis and questions, Limitations of the Study and Definition of technical terms.
1.2 Background of Study
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 (Lillian & Sitati,2011). There are number of banks in Pakistan that using the performance management system for making better their employee’s performance because it leads to achieve organizational performance. Armstrong (2001) stated the 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. Dessler (2005) define performance appraisal as “comparing the employee’s present and past performance to his/her performance standards”. (Grubb, 2007) says performance appraisal is a procedure to evaluate how individual personnel are performing and how they can improve their performance and contribute to overall organizational performance. (Beach, 2001) Performance appraisal is the systematic evacuation of employees according to their job and potential development. (Pınar 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. After employee selection, probably the most powerful tool managers have to examine employee’s performance and getting results is the performance appraisal. (Todd Grubb, 2007). Performance appraisal involves 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).
However studies have found out that formal appraisal by managers is often infective in improving the performance of subordinates since those given criticism about their performance tend to become defensive and resentful and thus then-productivity after appraisal tend to decline since productivity itself implies both efficiency and effectiveness which performance appraisal may affect (Decenzo, 2002).
Davar (2002) believes that appraisal of the employee is undoubtedly necessary at a time of his employment. However, an appraisal on continuing basis during the working life of such an employee is also very desirable and useful. Actually evaluation is constantly being done although at an unconscious level. Employees appraise supervisors, fellow colleagues, and subordinates. What is needed to generate proper control is a formal procedure for evaluating personnel within the organization. Such appraisals are at times as ratings where one individual after comparison with the other is ranked excellent, normal, or average. Such merit rating is usually used for ascertaining an employee's eligibility in fixing the qualities and characteristics to be rated in determining the person who should make such appraisal as well ·as by prescribing the appropriate procedure. Performance appraisal can be used for basically three purposes of which one is for promotions, salary increases and a basis for reward allocation. Secondly for identifying areas where development efforts are needed and lastly can be used as a criterion against which selection devices and development programs are validated.
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).
Therefore, in First Bank Nigeria Ltd where the research was carried out, the activities that was conducted is to know the Roles of Performance Appraisal on the Determination of Employees Productivity.
1.3 Statement of Problems
Appraisal is one of the most important activities carried out in almost all organizations in order to ascertain their employees and employers performance. Different appraisal techniques are used by different organizations while others combine all. Though appraisal has been introduced and applied with the aim of increasing employee productivity the appraised individuals have instead declined in productivity. Therefore this research will seek to establish more on the variables.
It has been observed that majority of workers m the manufacturing sector are daily exposed to diverse occupational health and safety hazards. This has impaired their health status and adversely affected their productive capacity. In the same vein, their prunes to industrial accidents had equally incapacitated physically some of the factory workers, which in turn had caused a decline in their level of productivity.
1.4 Aim and Objectives of Study
The aim of the study is to scrutinize the Roles of Performance Appraisal on the Determination of Employees Productivity using First Bank Nigeria Ltd as a case study. In achieving this aim, the following specific objectives were laid out as follows:
- To examine the types of performance appraisal in First Bank Nigeria Ltd
- To determine the role of performance appraisal on Employees Productivity in First Bank Nigeria Ltd
- To examine the factors which affect employee productivity in First Bank Nigeria Ltd
- To determine the relationship between performance appraisal and employee productivity in First Bank Nigeria Ltd
1.5 Research Questions
The study came up with research questions so as to be able to ascertain the above stated objectives. The specific research questions for the study are stated below as follows:
- What are the types of performance appraisal in First Bank Nigeria Ltd?
- What is the role of performance appraisal on Employees Productivity in First Bank Nigeria Ltd?
- Are any factors affecting employee productivity in First Bank Nigeria Ltd?
- What is the relationship between performance appraisal and employee productivity in First Bank Nigeria Ltd?
1.6 Research Hypothesis
In order to pursue the objective of this study, the following generalized statements have been designed to guide and aids in obtaining the result for the experiment to be conducted. For this work, the null hypothesis will be represented with H0 while the alternative hypothesis will be represented with hypothesis H1.
- H0: There is no significant relationship between performance appraisal and employee productivity in First Bank Nigeria Ltd
- H1: There is a significant relationship between performance appraisal and employee productivity in First Bank Nigeria Ltd
1.7 Significance of Study
The significance of the study will be of great importance to organizations and researchers and would enable the organizations to improve on the ways of increasing productivity. Performance appraisal is a critical management function which helps significantly in boosting employee morale and resulting to improved employee productivity. The result of the study will be of immense benefit to management practitioners, scholars, policy-makers, students and the public who will increase their understanding of the concept and applicability of this concept in various workplace situations. Specifically, the study will:
- Help managers learn and understand the role of performance appraisal in regard to employee productivity.
- Use the findings for proper and strategic decision-making.
- Add to the existing literature and knowledge on performance appraisal and serve as a basis for further research.
1.8 Scope of Study
The study focuses on the Roles of Performance Appraisal on the Determination of Employees Productivity using First Bank Nigeria Ltd as a case study.
1.9 Limitations of the Study
During the course of this study, many things militated against its completion, some of which are:
- Time Constraint: The time frame given to accomplish this project was very short due to school academic calendar and it was carried out under pressure which made the researcher not to implement some necessary features.
- Establishment Policies: Establishment policies posed a serious limitation as most staffs are not ready to release information needed for this project work. There were lots of information needed from the staffs of this establishment to enhance the study which took them time to release or they did not release at all for security purposes, hence the scope was reduced.
- Research material: availability of research material is a major setback to the scope of the study.
- Frequent power failure: This made the researcher append more money on fuel to ensure sustainable power.
- Financial Constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).
