The study examined the relationship between performance appraisal and corporate survival. The objectives of the study are to ascertain the relationship between job evaluation and organizational adaptability in selected oil and gas firms in PHC, Rivers State, determine the relationship between job evaluation and service quality improvement in selected oil and gas firms in PHC, Rivers State, determine the relationship between job evaluation and profitability in selected oil and gas firms in PHC, Rivers State. The survey method was adopted. The study was designed to focus on Ciscon Nigeria Limited and Thompson and Grace investment Limited. The population of the study was made to be one hundred (100). The Yaro Yemen’s was used to determine the sample size as 80. A self-designed questionnaire on performance appraisal and corporate survival was used and administered for the data collection. The Chi-Square statistical tool was used to test the hypothesis. Findings reveal that there is a significant relationship between performance appraisal and corporate survival. Based on the findings of the study summary, conclusion and recommendations were made that for appraisal to yield the desired outcomes, adequate attention should be paid to the avoidance of appraisal politics and the pursuance of fairness and transparency in the organization, performance appraisal exercise should not be seen as ingestion but rather as a means of developing the employee in his job with the intention of strengthening the strong points of the employee while enabling him to improve his weak point and that in addition, for management to achieve the objective of performance appraisal, the performance of workers at work and errors committed should be pointed out to them from time to time since this will aid their careers development in the attainment of corporate objectives.
TABLE OF CONTENTS
Title Page i
Table of Contents ix
List of Table xi
List of Figure…………………………………………………………………………………………Xiii
CHAPTER 1 1
1.1 Background To The Stdudy 1
1.2 Statement of Problem 4
1.3 Objective of The Study 5
1.4 Research Questions 5
1.5 Research Hypotheses 6
1.5 Significance of the Study 7
1.6 Scope of The Study 7
1.7 Limitation of The Study 7
1.8 Definition of Terms 8
CHAPTER 2 10
REVIEW OF RELATED LITERATURE 10
2.1 Conceptual Framework 10
2.1.1 Concept Of Performance Appraisal 11
2.1.2 Dimensions Of Perfomance Appraisal 12
2.1.3 Objectives Of Performance Appraisals 13
2.1.4 The Goals Of Performance Appraisals 13
2.1.5 Methods Of Performance Appraisals 16
2.1.6 Concept Of Corporate Survival 22
2.1.7 Measures Of Corporate Survival 23
2.2 Theoretical Framework 25
2.2.1 Goal Theory 25
2.2.2 Control Theory 26
2.3 Empirical Framework 28
CHAPTER 3 31
RESEARCH METHODOLOGY 31
3.1 Research Design 31
3.2 Population 32
3.3 Sample And Sampling Techniques 32
3.4 Questionnaire Design 33
3.5 Source And Method Of Data Collection 34
3.6 Data Analytical Techniques 35
3.7 Reliability And Validity 36
CHAPTER 4 37
DATA PRESENTATION AND ANALYSIS 37
4.1 Data Collection And Presentation 37
4.2 Data Analysis 38
4.3 Testing Of Hypothesis 44
CHAPTER 5 48
DISCUSSION OF FINDINGS 48
CHAPTER 6 51
SUMMARY, CONCLUSION AND RECOMMENDATION 51
6.1 Summary 51
6.2 Conclusion 51
6.3 Recommendations 52
Appendix I 55
Appendix Ii 56
1.1 Background of the Study
In today’s competitive business world, it is understood that organizations can only compete with their rivals by innovating. Organizations can only innovate by managing their human resources well. The human resource system can become more effective by having a valid and accurate appraisal policy used for rating performances of the employees. Unfortunately, the number of organizations using an effective performance appraisal policy is limited (Yalcin, 2002).
Performance appraisal is a key in human resource management function which is viewed as a subset of performance management. Rao (2005) argues that performance appraisal is a method of evaluating the behavior of employees in the workplace, this normally include both the quantitative and qualitative aspects of job performance. It helps to identify and overcome the problems faced by the employees in their workplace (Mackey & Johnson, 2000). Although it has many benefits for the organizations, states that performance appraisal have the equal probability of having a bad influence on the organization as well as on employee performance (Nurse, (2005)
According to Kuvaas, (2006); performance appraisal or employee appraisal is a method by which the job performance of an employee is evaluated generally in terms of quality, quantity, cost and time typically by the immediate line manager or supervisor. A performance appraisal is a part of the process of guiding and managing career development in both private and public sectors. It involves the task of obtaining, analyzing and recording information about the relative worth of an employee to the organization (Maud, 2001).
Accurate appraisals are crucial for the evaluation of recruitment, selection, and training procedures that can lead to improved performance. Appraisals can determine training needs and occasionally, counseling needs. They can also increase employee motivation through the feedback process and may provide an evaluation of working conditions, thus, improving employee productivity, by encouraging the strong areas and modifying the weak ones (Rao, 1994).
When effective, the appraisal process reinforces the individuals’ sense of personal worth and assists in developing his/her aspirations. helps firms, industries and nations to achieve sustainable competitive advantage (Maud, 2001). Industry is a thrust area for countries in their quest for competitiveness. It must be noted that banks which have maintained the momentum of continuous growth, and profitability showed better ratio of manpower effectiveness. Each element has crucial sub-components which serve as building blocks for productivity (Rao, 1994).
To thrive or survive, organizations need to continuously improve quality, attract more customers, and become more cost conscious. In other words, firms need to better manage their performance appraisal which has the propensity of enhanced employee performance. Over the years, there are many practices, tools, techniques, systems, and philosophies that aim at helping organizations to gain the competitive advantage of higher performance.
There has been a widespread use of performance appraisal in work organizations all over the world. This widespread use of Performance Appraisal Systems (PAS) can be attributed to human resource specialists, academics and consultants who proclaim that performance appraisal is a critically needed tool for effective human resource management (Locker and Teel,1997).
Formal performance appraisal has become a widespread instrument of human resource management. Surveys reported in the 1970s and 1980s already indicated that between 74 percent and 96 percent of U.S. organizations, and a comparable proportion of British firms had a formal performance appraisal in place. Large, complex organizations are especially likely to conduct formal appraisals (Berry, 2003). Not surprisingly, many firms in Thailand are vigorously implementing Performance Management System (PMS) to help them better manage their employee’s performance and in turn, it affects organizational performance. Since it is the key process through which work is accomplished, it is considered the “Achilles heel” of managing human capital (Pulakos, 2009). Hence, it is very important to manage performance appraisal effectively.
Organizations exist to survive in the midst of environmental factors that tend to encroach on business performance. Organizations attempt to maintain the existing state of affairs, but essentially the larger part of their efforts is tilted towards survival (Mindy, 1998). The competition in the industry is getting stronger and firms are adopting different strategies to survive the prevailing competition in the industry. Surviving is the global struggle to meet with increasing demand on firms in the market place has seen by many researchers and academicians as having a resort to pay attention to the individual employees in the organization since innovation in product and services are brought about by these individuals.
However, in the review of past studies carried out by Ebue (2003) despite the level of work that has been done, only few studies try to discuss some specific aspects of performance appraisal that can affect survival of organizations. From the foregoing therefore, this study seeks to examine the relationship between performance appraisal and corporate survival in some selected Gas Companies Port Harcourt Metropolis.
1.2 Statement of Problem
This brings us to those problems that are associated with conducting performance appraisals. The process usually starts at the middle management level where it is the job of a middle level manager to appraise his subordinates or employees who are under him. In fact every successive hierarchical level, the superiors are asked to evaluate the employees who are working under them. This can give rise to many issues that make performance appraisals an unpleasant task. As a result, many managers view the process of appraisal as time consuming and burdensome. To begin with performance appraisals can cause friction, resentment and the consequent low morale. Since appraisals are rather subjective in nature, they can also be disputed in case of negative ones.
The performance appraisal systems tend to have several problems. Raters‟ evaluations are often subjectively biased by their cognitive and motivational states (DeNisi & Williams, 1988), and supervisors often apply different standards with different employees which results in inconsistent, unreliable, and invalid evaluations (Folger, 1992). In order to create better systems, researchers have traditionally focused on validity and reliability (Bretz 1992) by designing newer “forms” of performance appraisals (e.g., behavioral based systems that better define specific essential job functions of employees or 360-degree feedback mechanisms that allow for cross-validation via multiple raters). However, despite these recent advances in evaluation design, critics continue to argue that performance appraisal systems are not consistently effective (Atkins & Wood, 2002; DeNisi & Kluger, 2000).This study sought to examine performance appraisal and organizational survival.
1.3 Objective of the Study
The main objective of the study is to examine the relationship between performance appraisal and corporate survival in selected oil and gas firms in Port Harcourt, Rivers State. The specific objectives are to:
i. Examine the extent to which rating scale associate with corporate survival in selected gas firms in Rivers State.
ii. Examine the extent to which ranking associate with corporate survival in selected gas firms in Rivers State.
iii. Examine the extent to which management by objectives associate with corporate survival in selected gas firms in Rivers State.
1.4 Research Questions
The following research questions will guide this study;
i. Does rating scale associate with corporate survival in selected gas firms in Rivers State?
ii. Does ranking associate with corporate survival in selected gas firms in Rivers State?
iii. Does management by objective associate with corporate survival in selected gas firms in Rivers State?
1.5 Research Hypotheses
With the research questions in perspective, the following
HO1: There is no significant relationship between performance appraisals and corporate survival in selected gas firms in Rivers State.
HA: There is a significant relationship between performance appraisals and corporate survival in selected gas firms in Rivers State.
1.6 Significance of the Study
This study is significant in the following ways;
Firstly, this study will be significant to shareholders of these organizations as the survival of the organization is paramount. It will also assist managers manager’s these firms even as it is in their continued survival. It will be relevant to employees in the organization. This study will add to existing knowledge in management sciences.
1.7 Scope/Delimitation of the Study
The study is intended to empirically examine the relationship between performance appraisal and corporate performance. The study limits scope to some selected Gas Companies in Port Harcourt Metropolis, Rivers State with special reference to Ciscon Nigeria Limited, Thompson and Grace Investment Limited.
1.8 Limitation of the Study
In carrying out an investigation of this nature the researcher must of necessity be faced with some constraints.
Firstly, the time constraints, the time frame provided for this study was short.
Secondly, Financial constraints. Usually, a study of this nature involved some level of expenditure therefore; finance was also a limiting factor.
Thirdly, Poor response from the respondent and inability to access the entire population of the study. In the next segment significance of the study will be discussed. Lastly, poor measurement instrument.
1.9 Definition of Terms
Adaptability is the degree to which an organization has the ability to alter behavior, structures; and systems in order to survive in the wake of the environmental change.
Corporate survival has been the most interesting topics for organizations over the years. Organizations exist to survive in the midst of environmental factors that tend to encroach on business performance.
CUSTOMER SERVICE IMPROVEMENT
Service quality improvement consists of systematic and continuous actions that lead to measurable improvement in service quality.
Job evaluation is the rating of jobs in an organisation. This is the process of establishing the value or worth of jobs in a job hierarchy. It attempts to compare the relative intrinsic value or worth of jobs within an organization. Thus, job evaluation is a comparative process.
Performance Appraisals is the assessment of individual’s performance in a systematic way.
Profitability means ability to make profit from all the business activities of an organization, company, firm, or an enterprise. It shows how efficiently the management can make profit by using all the resources available in the market.
Staff development represents an intentional effort by supervisors and administrative leaders of student affairs to improve staff members’ effectiveness, leading to improved organization effectiveness.
Complete Material Cost #3,000