(A CASE STUDY OF AGIP OIL COMPANY NIG. LTD)
Complete Material Cost #3,000
Order for Complete Material now
ABSTRACT
The purpose of this research is to ascertain the Impact of Effective Organizational Reward System on employees job performance in Nigeria. The research questions and hypotheses addressed the extent to which improved employees job performance/reduced rate of industrial action is influenced by the implementation of effective organizational reward system. The core aspect of the study is the issue of cross-sectional survey research design in generating the required primary data. The Taro Yemen’s formula was used for the population using stratified random sampling method. The results indicated that implementation of effective organizational reward system in organizations to a large extent influenced improved employees’ job performance. It therefore recommends that; there should be regular review of organizational reward system to ensure fairness, maintenance of competitive rates of pay, flexibility in reward administration and rewarding people for the value they create.
CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
Reward is the benefits that from performing a task, rendering a service or discharging a responsibility. The principal reward for performing work is play, many employers also offer reward packages of which wages and salaries are only a part. The packages typically include: bonuses, pension schemes, health insurance, allocated cars, beneficial loans, subsidized meals, profit sharing, share options and much more.
Reward system is an important tool that management uses to channel employees motivation in desired ways. In other words, rewards systems seek attract people to join the organization, keep them coming to work and motivate them to perform to high levels.
According to Chiang and Birtch, the utility enticement entrenched in an organization’s reward system is revealed in a variety of theoretical perspectives. The dichotomy between intrinsic and extrinsic rewards as initiated by Herzberg et al, labeled achievement, recognition and advancement as intrinsic rewards that motivate employees more than extrinsic rewards (salary, job security or working environment etc). Zhou et al stated that the philosophy of extrinsic rewards originated from the term “utilitarianism” which suggests that people’s behaviours is modifiable. Thus, by providing extrinsic rewards their performance could be enhanced as opposed to the term “Romanticism” which refers to intrinsic motivation that boosts the innovative and creative abilities of the employees.
Vroom in his expectancy theory state that certain behave iour will be exhibited only when the expectations and consequences are related. Porter and Lawler followed vroom’s ideas and further contended that people often determine efforts at work by judging the value of their efforts and the relationship between their efforts end expected rewards. Maslow stated that only unsatisfied needs could motivate further action since it creates disequilibrium. Latham and Locke speculated in their goal setting theory that performance can be enhanced only when the objectives and goals of an organization are difficult and feedback is associated with the elevate performance for the attainment of higher goals.
Adams totally negates this notion and conceived the idea of equitable reward. According to him people can only be motivated when they are treated in an equitable manner. If employees feel that their inputs are fairly rewarded they would be happier or not dissatisfied. If they feel unfairly rewarded, they would become dissatisfied with their job and employer. It is important to note that the degree of dissatisfaction depends on the degree of perceived disparity in the reward-to-effort ratio. For some people, any smallest indication of negative disparity is enough to cause massive disappointment and a feeling of considerable injustice, others may reduce effort and become inwardly disgruntled or outwardly difficult recalcitrant or even disruptive, yet other may seek to improve their outputs by making claims or demands for more reward or seeking alternative job. It is against this background that it becomes pertinent to discuss the impact for fair reward system on employees’ job performance in Nigeria Agip Oil Company Limited, Port Harcourt.
1.2 STATEMENT OF THE PROBLEM
Effective, fair, timely, and market-driven rewards can be motivational for managers and employees alike. Experience and research in the science of success reinforces the concept that effective and fair rewards can motivate and enhance employee’s productivity. For the past 10 years, Nigerian Agip Oil Company limited Port Harcourt has been “experiencing problems in implementing it corporate reward system due to the non-residence of its expatriate personnel manager owing to the incidence of expatriates kidnapping in the Niger Delta.
This situation has resulted in the casualisation of most workers whose rewards are now based on a daily paid system culminating in fluctuations in organizational output. The corporate reward system of the company is usually determined by top management in the foreign headquarters of the company in Italy, while the expatriate personnel manager implements this reward system locally.
However, the non-residence of the expatriate personnel manager in Port Harcourt creates a managerial gap in the implementation of the corporate reward systems thus creating room for the development and contractors resulting in industrial actions (strikes/lockout) and unpredictable output levels. The local management of the reward system by the labour contractors also results in delays in the formulation of staff development plans. This situation demotivates employees and encourages industrial disputes and fluctuations in output levels.
It is this unfair reward system (daily paid system) and its associated industrial disharmony in Nigeria Agip Oil Company limited Port Harcourt that informed this research.
1.3 OBJECTIVES OF THE STUDY
The objectives of the research are as follows:
1) To determine the extent which improved employees’ job performance is influence by the implementation of fair reward system in Nigerian Agip Oil Company limited Port Harcourt.
2) To determine the extent at which reduced rate of industrial action is influence by the implementation of fair reward system in Nigerian Agip Oil Company limited Port Harcourt.
1.4 RESEARCH QUESTIONS
Previous attempts at implementation a fair reward system in Nigerian Agip Oil Company limited Port Harcourt has been bases on the local implementation of corporate reward system by the non-resident expatriate personnel manager without success. The managerial gap occasioned by his absence led to emergence of multiplicity of unfair daily paid reward system by various labour contractors thus prompting the following research questions:
1) To what extent is improved employees’ job performance influenced by the implementation of fair reward system in Nigeria Agip Oil Company Limited Port Harcourt?
2) To what extent is reduced rate of industrial action influence by the implementation of fair reward system in Nigeria Agip Oil Company limited Port Harcourt.
1.5 RESEARCH HYPOTHESIS
In view of the above research questions, the following null hypotheses were formulated:
H0: Improved employees’ job performance is not influence by the implementation of fair reward system in Nigeria Oil Company Limited Port Harcourt.
H1: Reduced rate of industrial action is not influenced by the implementation of fair reward system Nigeria Agip Oil Limited Port Harcourt.
1.6 SCOPE AND LIMITATION OF THE STUDY
The scope of the study is limited to Port Harcourt. Port Harcourt was chosen for the study because of its cosmopolitan nature and therefore. The find out of this study will at worst five the reader an ideal of how to improve employee’s performance through proper reward system.
In the course of carrying out this study, the researcher met certain problems and difficulties that constitute the limitations in one form or the other. The researcher being a student was pace with financial constraints time factor, and bureaucratic redtapism in the organization investigated which affected the pace of the work.
1.7 DEFINITIONS OF TERMS
ORGANIZATION: Organized group for people and system.
OBJECTIVE:Mission, parameter,compass or targets is fororganizations form or direction for the evaluation of the process in individual and work units to integrates them.
WORKER’S PRODUCTIVITY: The efficiency of the individual person whoworks in an industrial production.
Complete Material Cost #3,000