The study investigated performance appraisal and organizational effectiveness with a view to assessing the impact of performance on firm’s productivity, employees’ satisfaction and adaptability. To actualize these objectives, the study adopted the survey research design, involving the design and administration of questionnaire to respondents drawn from Nigeria Bottling Company plc Benin City. The population size consists of 100 employees of the firm while the sample size used is 70. The research relied on the primary data i.e questionnaire. Upon presenting and analysis of data, it was discovered using Chi-square test that there is a significant relationship between quality performance appraisal, organizational effectiveness, employees’ initiative and organizational effectiveness amongst others. The study concludes that performance appraisal is a critical aspect of corporate existence and a determining factor for firm competitiveness. Accordingly, It was recommended that performance appraisal should be periodically conducted to prevent fall in productivity standards of employees; management should provide a conducive working environment for employees.
1.1 BACKGROUND TO THE STUDY
Attainment of a high level performance through productivity and efficiency has always been an organizational goal of high priority.
Performance appraisal as a vital tool measures the framework set by any organization to it employees. It is utilized to track individual contribution and performance against organizational goals and to identify individual strengths and opportunities for future improvements and assessed whether organizational goals are achieved or serve as basis for the company’s future planning and development.
The success of any organization depends on the quality and characteristics of its employees. The employees are significant factors in any organization since they are the heart of the company. Organizations simply cannot achieve their goals and objectives without them. However, it is a fact that any employee for that matter needs something to induce he/her to look forward to, so that he/she is motivated to work at the best interest of the company. This indeed was indicative of the more strategic approach to Human Resource Management (HRM) policies which sought to connect the arms of the individual. The organizations key aims, goals and objectives became an embedded part of and communicated through the performance appraisal process Marchington and Wilkinson (2005).
Deblieux, (2003) performance appraisal is the systematic periodic and impartial rating of an employee’s excellence in matters pertaining to his present job and his potential for a better job. Performance appraisal is a review and discussion of an employee’s performance of assigned duties and responsibilities. The appraisal is based on result obtained by the employee in his/her job, not on the employee’s personality characteristics. The appraisal measure skills and uniformity. It provides a way to help identify area for performance enhancement and to help promote professional growth. The essence of this performance appraisal is to obtain information for promotion, emotion, transfer, pay increment, training lay-off termination decision and development.
Armstrong and Baron (2005) defined the performance appraisal as a more limited approach which involves manager making a top-down assessment and rating the performance of their subordinates at an annual performance appraisal meeting.
Armstrong (2006) describes performance appraisal as a tool for looking forward to what need to be done by people in the organization in order to achieve the purpose of the job to meet new challenges. Better use of technology skills and attributed.
Szilag and Wallace (1990) in addition will develop both organizational and individual capabilities and reach agreement on areas where performance needs on the effectiveness of its employee generating information which influences many of the organizations decision. Annual performance appraisals enable management gavages and monitor whether institutional standards expectations and objectives, and delegation of responsibilities and tasks are achieved. Staff performance appraisals also establish individual training needs and enables organization to identify training needs analysis and planning.
Normally, performance appraisal has been restricted to a feedback process between employees and supervisor. However with the increased focus on teamwork, employee development and customers service, the emphasis has shifted to employee feedback from the full circle of sources deputed in the milt-input approach to performance feedback is sometime called 360-degree assessment (Mclean, 1997). Organization usually have annual performance reviews with supervisor providing comments on employee performance. The leading Indian companies are adopting a very progressive approach to performance management by adopting a 360-degree approach or management by objectives (MBO) Wise (2005) also said that performance appraisal system helps an employee discover his strengths and weaknesses and would help him in decision making about his career choices. Performance appraisal is one element of the performance management process which involves different measurements throughout the organization but it is an element which is important if the organization is to take advantage of their most important assets employees and gain human capital advantage. There are other processes within the organizations such as technology and design but it is the human factor which most difficult to replicate and therefore the most valuable.
Dinstrong and Baron,(2005). Strategy implementation and delivery of the organizational strategic target is the best accomplished through high performance people Michitsch, (2000). It is the development of these people whose performance appraisal seek to advance. This is not the only identified purpose for performance appraisal.
Ideal performance appraisal approach effectively enable the employee to meet their own performance targets to the organization through motivated self learning, also that the organization meet and indeed exceed their strategic target by linking individual performance target to the overall strategic target of the organization.
The institutions need to evaluate programs performance to achieve justice and quality among employees/personnel/staff. In order to raise the enthusiasm and competition among employees and to uncover the talent for the future Mohamed Ahmed, (2007). The process of measuring and evaluating the human resource management, through the measurement and evaluation enable the organization to judge the accuracy of the programs and policies adopted, whether policies to attract, select and appoint or programs and policies for training development and follow-up their human resources Mohamed, (2009). Many organizations have adopted the performance appraisal process as one of the main methods used for workers development, hence business performance improvement. A direct outcome of that massive adoption was the re-ignition and understanding of the dependency between accuracy, effectiveness, quality of the performance appraisal process, employee’s initiative, adaptability, job knowledge, reliability of the process and quality. Performance appraisal is very important within organization that will help to evaluate the staff according to their tasks in order to ensure they conduct their job at a required standard which will effect on the compensation. In addition its significance to identify their skills performance and to know their weakness and how to improve it within departmental target.