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IMPACT OF EMPLOYEE PERFORMANCE APPRAISAL ON THE PERFORMANCE OF WORKERS IN AN ORGANIZATION

CHAPTER ONE

INTRODUCTION

1.1     Background of the Study

Performance appraisal is one of the most significant aspects of human resource activities designed and performed in the companies as well as in every walk of life. In terms of definition, it is an act of formally evaluating performance of non-managerial staff at least once in a year (John, Clive, 2007). Performance appraisal can be defined as an act of testing, evaluating, measuring and justifying the performance displayed by the employees during a specific period of time (Meysam, Mohammad, Behrooz, Ebrahim, 2012). The companies may change the time interval of performance appraisals according to their nature of business and requirement.

Historically, performance evaluation was first time studied in the spinning factory in Scotland more than two hundred years ago. With the passage of time and the evolution process, performance appraisal has gained so much importance that, not only in corporate sector but almost in all sectors, the decision of awarding reward and punishment is based on it. Now performance appraisal is defined as an act of managers to examine and evaluate employee’s performance comparing it with the set benchmark and document the results and giving feedback to the employees to indicate where there is deficiency which needs to be improved. The main purpose of performance appraisal to the management is that it assists them to determine who needs what training, who should be promoted, demoted, retained or fired, basing on employee’s performance. Employee performance is the set of actual (timely and accurate) accomplished tasks and duties by the employee. The tasks and duties are set and evaluated by the management or the line manager. The employee performance is so important that the ultimate goal of Human Resource Department is to achieve sustainable improvement in employee performance by providing required training, work environment, rewards and care.

Employee Performance is outcomes achieved and accomplishments made at work. It is aimed at results as planned. Although performance evaluation is at the heart of performance management (Cardy 2004), the full process extends to all organizational policies, practices, and design features that interact to produce employee performance. This integrative perspective represents a configurational approach to strategic human resources management which argues that patterns of HR activities, as opposed to single activities, are necessary to achieve organizational objectives (Delery and Doty, 1996). One variable that has been receiving increasing attention as a key determinant of employee performance is employee engagement (Macey, Schneider, Barbera, and Young, 2009). Studies (Mone and London, 2010) suggest that fostering employee engagement will lead to higher levels of performance.

1.2       Statement of the Problem

Many organizations experience low productivity despite their acclaimed effective performance appraisal system (Armstrong, 2006).  In Nigeria, many organizations are experiencing low productivity and performance due to ineffective appraisal system. Performance appraisal is viewed and conducted solely in terms of its evaluative aspect thereby overlooking its use for facilitating growth and development in workers through training, coaching, counselling and feedback of appraisal information (Asamu, 2013). The inability of many organizations to install an effective performance appraisal strategy has hindered them from achieving competitive advantage (Obisi, 2011). Some of the questions bothering the mind of the researcher are; what is the level of awareness of existence of performance appraisal in Chemical and Allied Products Plc? What impact does the performance appraisal system have on employee performance? And what are the problems that hinder effectiveness of performance appraisal in Chemical and Allied Products Plc?  This study justified the need for a detailed explanation in this area if the Nigerian manufacturing industry is to achieve its vision of taken a leading position in the global manufacturing space.

1.3       Objectives of the Study

The main objective of this study is to determine the impact of employee performance appraisal on the performance of workers in an organization in Chemical and Allied Products Plc. Specific objectives include; 

i.  To determine the level of awareness of existence of performance appraisal in Chemical and Allied Products Plc.

ii.  To assess the impact of performance appraisal on employees’ performance.

iii.  To identify the problems to effective performance appraisal system in Chemical and Allied Products Plc.

1.4   Research Questions

i.  What is the level of awareness of existence of performance appraisal in Chemical and Allied Products Plc?

ii.  Is there a significant impact of performance appraisal on employees’ performance?

iii.  What are the problems to effective performance appraisal system in Chemical and Allied Products Plc?

1.5     Research Hypothesis

H0: There is no significant impact of performance appraisal on employees’ performance.

Hi: There is a significant impact of performance appraisal on employees’ performance.

1.6     Significance of the Study

This study will be of immense benefit to other researchers who intend to know more on this study and can also be used by non-researchers to build more on their research work. This study contributes to knowledge and could serve as a guide for other study.

1.7    Scope of the Study

This study is on the impact of employee performance appraisal on the performance of workers in an organization. The study will be conducted in Chemical and Allied Products Plc.

1.8       Limitations of the study

The demanding schedule of respondents made it very difficult getting the respondents to participate in the survey. As a result, retrieving copies of questionnaire in timely fashion was very challenging. Also, the researcher is a student and therefore has limited time as well as resources in covering extensive literature available in conducting this research. Information provided by the researcher may not hold true for all research under this study but is restricted to the selected respondents used as a study in this research especially in the locality where this study is being conducted. Finally, the researcher is restricted only to the evidence provided by the participants in the research and therefore cannot determine the reliability and accuracy of the information provided. Other limitations include;

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).

Time constraint: The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

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