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THE EFFECT OF EMPLOYEES PARTICIPATION IN DECISION MAKING ON ORGANISATION PERFORMANCE

ABSTRACT

This research tends to examine the effect of employees participation in decision making on organization performance with reference to Nigeria Bag Manufacturing Plc. Survey research design was employed and simple random sampling technique was used in collecting data. With the use of well structured questionnaire, data was gathered from one hundred staff of Nigeria Bag Manufacturing Plc. The data collected was analysed and presented on table in percentile. Two hypotheses were formulated and tested with the use of Chi-square test analysis. The analysis resulted into reject both null hypotheses and accepting the alternate hypotheses, thereby concluding that there is significance correlation between employee’s participation in decision making and organization performance and that significance relationship exists between employees working experience and level of participation in decision making. Recommendations were proffered to Nigeria Bag Manufacturing Plc. and manufacturing industries in large.

CHAPTER ONE

INTRODUCTION

1.1     BACKGROUND TO THE STUDY

Economic changes in recent decades have required employers to seek more efficient and flexible means of production. Deregulation and privatization have also significantly altered the Nigeria’s industrial relations climate, with a decline in trade unions' influence and membership. Mirroring this has been the growth in ‘new' forms of work-related participation by employees, under the banner of human resource management and associated programmes and strategies for partnership and high commitment (Abdel, 2003).

Governments must balance the needs of a competitive economy with the welfare of their citizens. A change in political climate has seen social partnership currently being promoted by all interested parties. Reflecting this change, the inclusion of trade unions in government consultation exercises is significant. (Schuler, 2005) Employee participation in decision-making has attracted a great deal of interest among management writers, researchers, and more encouragingly, managers in organizations as well. It is generally believed to be instrumental in increasing productivity, as the Japanese has shown, through creating satisfied and motivated employees. Thus in recent years, many participative programmes were introduced in organizations. Among them are quality circles, total quality management, work councils, works teams, and so on (Abdel, 2003).

Employee participation in decision-making has been defined in various ways. Some writers associate it with terms such as influence, involvement, decision-making, and control. Participation can also include indirect forms such as through employee representatives like trade unions and so forth as against the direct form where employees are involved in the decision-making process directly. However, most writers tend to be concerned with the direct form of participation rather than the indirect form.

Participation here is as the degree to which employees perceive they have involvement and/or influence in the decision-making process in their organizations that might have impacts on their jobs, whether such impacts may be direct or indirect. Such decisions may include goal setting, evaluating alternatives which lead to making the final choice, solving problems, "organizational development" and other similar kinds of decisions in an organization, (Schuler, 2005).

The relationships between employee participation and performance as well as with job satisfaction have been fairly well researched in developed countries. Generally, these studies have indicated that employee participation is positively related to employee performance and job satisfaction. However, one question that arises concerns the generalization of these findings across cultures. If employee participation were to benefit organizations, then what factors could be considered by management personnel to be implemented successfully in their organizations? In addressing this issue, most studies in the past have examined the effects of individual characteristics on participation.  However, the effect of organizational variables on employee participation has not been thoroughly researched (Schuler, 2005).

Similarly, the effect of employees' motivation to participate in the decision-making process in their organizations has also not been thoroughly researched. Against this background, the three main rationales for introducing employee participation are based upon different economic, social and political assumptions:

i. Economic – changes in employees' attitudes and behaviour are achieved through financial participation, by offering employees a stake in the firm. Employees' association with management values and goals is thereby increased, and they are more motivated and committed to achieving those goals.

ii. Social – by catering for employees' social needs, through improved job security and satisfaction and quality of working life, higher performance is achieved. Alternatively, satisfying social needs can be treated as an end in itself. In attempting to explain participation performance and participation-satisfaction relationships the objective of this study will be examined.

1.2    STATEMENT OF THE PROBLEM

The relationships between employee participation and performance as well as with job satisfaction have been fairly well researched in developed countries. Generally, these studies have indicated that employee participation is positively related to employee performance and job satisfaction. However, one question that arises concerns the generality of these findings across organizational cultures. Furthermore, most of these studies were carried out in profit making organizations. Would similar findings also apply to employees in non-profit making settings such as a training organization? If employee participation were to benefit organizations, then what factors could be considered by management personnel to be implemented successfully in their organizations? In addressing this issue, most studies in the past have examined the effects of individual characteristics on participation.  However, the effect of organizational performance on employee decision participation has not been thoroughly researched (Schuler, 2005). Similarly, the effect of employees' motivation to participate in the decision-making process in their organizations has also not been thoroughly researched.

1.3     PURPOSE OF THE STUDY

The overall aim of the objective of this study is to examine the nature of relationships between selected independent variables with employee participation in decision-making and how it affects organizations performance.  The study was conducted to determine the effect to which employee participation is related to organization performance and job satisfaction using Bagco Super Sack as a study. The study shall aim at the following: Other objectives include to:

i. determine  if  higher the level of employee participation in decision-making the higher would be the organization performance, job satisfaction and job performance

ii.  examine whether the more years of working experience (holding current job, serving in current organization, and total working experience) the higher would be the level of participation.

iii. determine if the higher the job ability or task competency the higher would be the level of employee participation in decision-making.

iv. Determine Employees who possess progressive and dynamic personality traits show higher levels of need for achievement, need for independence, and need for power; but a lesser degree of authoritarianism tend to have a higher level of participation in decision-making.

v.  Determine if the greater the motivation to participate, the greater would be the level of participation.

vi. To determine if the more conducive the work environment (greater superior supportiveness, superior's lesser degree of authoritarianism, positive task attributes, work pressure, and pace of change) the higher would be the level of employee participation in decision-making.

1.4     RESEARCH QUESTIONS

i.  The higher the level of employee participation in decision-making the higher would be the organization performance and job satisfaction.

ii. The more years of working experience (holding current job, serving in current organization, and total working experience) the higher would be the level of participation.

iii. The higher the job ability or task competency the higher would be the level of employee participation in decision-making.

iv. Employees who possess progressive and dynamic personality traits show higher levels of need for achievement, need for independence, and need for power; but a lesser degree of authoritarianism tend to have a higher level of participation in decision-making.

v.  The greater the motivation to participate, the greater would be the level of participation and organization.

vi. The more conducive the work environment (greater superior supportiveness, superior's lesser degree of authoritarianism, positive task attributes, work pressure, and pace of change) the higher would be the level of employee participation in decision-making.

1.5     STATEMENT OF HYPOTHESIS

In order to find some answers to the research questions posed above, a study was conducted among staffs in (BAGCO), and the relevant hypotheses selected for testing included the following:

Hypothesis 1

H0: That there is no significant correlation between employee’s participation and organization performance.

H1: That there is significance correlation between employee’s participation in decision making and organization performance.

Hypothesis 2

Ho: there is no significance relationship that exist between employees working          experience and level of participation in decision making.

Hi: there is significance relationship that exists between employees working experience and level of participation in decision making.

1.6     SIGNIFICANCE OF THE STUDY

The relevance of this study is aimed at showing the importance of employee participation if properly enhanced, certain critical factors will be present in an organization.

i. These include supportive superiors who are less authoritarian in their management approach.

ii. Employees would be independence and perceive that they face a moderate amount of work pressure.

iii. Individuals with high need for independence, achievement, and job abilities are likely to perform better in their jobs.

iv. On outcomes from participation, trainers were found to place greater importance on intrinsic than extrinsic outcomes

The study will also be useful to scholars in the field of social science, management and other related field as secondary source.

1.7     SCOPE OF STUDY

The scope of this study will be limited to the personnel of the organization of study (BAGCO). However, only the middle and lower category staff will be given the questionnaire. (Category A: Middle staff), and the lower officers (Category B: Lower Staffs) the research work will focus mainly on the employees participation in decision making. The study shall be conducted at the Lagos office of Bag Manufacturing Company Nigeria Plc, for the sampling of opinions on the subject.

1.8     DEFINITION OF TERMS

Employees: Personnel who are paid to work

Decision: The ability to choose or decide about things in a clear and definite way without too much hesitation or delay.

Participation: To take part in an event or activity.

Decision Making: The process of making choices or reaching conclusions, especially on important political or business matters, deciding on important matters.

Organization performance: a group of people identified by a shared interest or purpose to develop and enhance the growth of their company.

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