Effect of Employee Performance Appraisal and Motivation Strategy on Employees in the Banking Industry

Effect of Employee Performance Appraisal and Motivation Strategy on Employees in the Banking Industry

Abstract of Effect of Employee Performance Appraisal and Motivation Strategy on Employees in the Banking Industry

Employee performance appraisal and motivation goes together in determining employee and organizational performance as well as competitiveness. Many organizations have tried to promote employee motivation and performance but most of them have not followed the requirement that could promote them. This study provides effective methods of using employee motivation and performance.

The study analyses various methods and approaches to integrate them. Five hypotheses were postulated to find out if there is significant relationship between employee motivation and employee performance, employee performance appraisal and organizational performance, managers’ appraisal skill and employee motivation, and employee performance appraisal and employee training.

Questionnaires were formulated based on based on the hypotheses and 130 questionnaires were distributed to six branches of Wema bank in Lagos and Ibadan which 92% (120) of the distributed questionnaires were retrieved. The questionnaires were analyzed based on inferential statistical method of chi-square at 0.05 level of significance.

Findings revealed that there is significance between employee motivation and performance appraisal, and employees and organizational performance. The study recommends that managers and organizations should engage in effective use of performance appraisal and motivate their employees for organizational performance.

Keywords: employee performance appraisal, employee motivation, employee performance and organizational performance.

Chapter One of Effect of Employee Performance Appraisal and Motivation Strategy on Employees in the Banking Industry

INTRODUCTION

BACKGROUND TO THE STUDY

The relationship between appraisal and motivation is one of the main concerns of an organization’s management. For organizations to achieve their stated objectives and goals, employees must have appraised based on the basis of present or past performance, relative to the organization so as to motivate them through feedback and encourage them to perform above par or put in more efforts.

A performance appraisal is the process of assessing workers performance in comparison to certain predetermined organizational standards. Performance appraisal is a formal system of measuring, evaluating and influencing an employee’s job-related attributes, behaviours and outcomes.

In some organizations, appraisal results may be used to determine relative rewards in the firm – who should get merit pay increase, bonuses, or promotions. Similarly, appraisal results can be used to identify the poorer performers who may require some form of counseling, training, demotion, dismissal or decreases in pay of the poor performance.

Interestingly, performance appraisal is a very controversial managerial issue. Some researchers have expressed doubts about the validity and reliability of the process. On the other hand, there are advocates of performance appraisal who claim that it may well be the most critical of all Performance Appraisal and Motivation.

Motivational research conducted by the theorists including Elton Mayo and Frederick Taylor, have recognized the power of recognition as an incentive performance appraisals provide employees with recognition for their work efforts. The appraisal system provides the supervisor with an opportunity to indicate to employees that the organization is interested in their performance and development. This recognition can have a positive motivational influence on the individual’s sense of worth, commitment and belonging.

Motivation is defined as a psychological process that gives behaviour purpose and direction. Motivation is seen as a very important aspect of an organization as it contributes to how well it performs. This ultimately has an effect on organizations’ corporate objective. This includes attainment of higher market share and profit maximization as a result of the employee of Permernace.

BACKGROUND OF WEMA BANK

Wema Bank Plc was formally known as Agbonmagbe Bank and was incorporated in 2nd May 1945 as a private limited liability company. It commenced business operations as a commercial bank in the same year. The Bank was converted to a public limited liability company in April 1987 and was subsequently listed on the floor of the Nigerian Stock Exchange inJANUARY 1990.

On February 5, 2001, the Central Bank of Nigeria granted a Universal Banking License to the Bank, thus allowing the Bank to undertake a wide range of financial services to its numerous customers across the country.

The Bank has witnessed tremendous growth and development in branch network, quality of service delivery and overall financial performance in the last two decades. The bank embarked on a process of corporate transformation that has resulted in the emergence of a restructured Wema Bank PIc, strategically positioned to fully optimize opportunities in the industry.

Wema Bank Plc is adequately capitalized, her shareholders’ funds is in excess of N25billion and her asset base is N165 billion. Presently, Odu’a Investment Company Limited holds 10% equity stake in the Bank, while private individual investors and staff of the Bank own the remaining 90%.

The authorized share capital of the Bank is N7,000,000,000.00 divided into 14,000,000,000 ordinary shares of SO kobo each.

With banking operations spanning sixty years, Wema Bank PIc is reputed to the longest surviving indigenous bank in Nigeria. Wema Bank Plc is a customer-focused bank and takes delight in learning the intricacies of her customers businesses and preferences, thus her byline “Together to greater heights”.

STATEMENT OF THE PROBLEM

Most organization does not usually do employee performance appraisal and motivation and the few that does these do not use appropriate method of employee performance appraisal and motivation. The inappropriate methods used by such organizations do not allow both the employees and the organization to benefit well from the employee performance appraisal and motivation strategy used. This study tends to look at effective methods to use in appraising and motivating employee performance so that the employees can have an improved performance to cope with the changes in the banking industry using Wema Bank Plc as a case study.

AIM AND OBJECTIVES OF THE STUDY

The aim of the study is to determine the significance of employee performance appraisal and motivation on employees in the banking industry.

The objectives are:

1.    To determine the significance of employee performance appraisal on employee performance.

2.    To find out the relationship between motivation strategy and employee performance.

3.    To examine the significance of performance appraisal on organizational performance.

4.    To investigate the relationship between managerial appraisal skills and employee motivation.

5.    To examine the relationship between employee training needs and performance appraisal.

6.    To determine the skills required for appraising employee performance.

7.    To provide plausible recommendations on how performance appraisal can be improved.

8.    To investigate how needs and need satisfaction operate to influence such variable as performance.

9.    To examine the behaviors of employees when the goals set before them are not realistic.

10.To check how performance appraisal is conducted in Wema Bank Plc.