Chapter 1
Introduction
“Assessment” is the process of evaluating the work of the staff
member in a given period
vis-a-vis responsibilities assigned, providing timely feedback for
the same with a view to performance improvement/ development, and providing
him/her an opportunity to state his/ her views for the same.
Testing
of a performance is an informational system which is the essential core of the
performance evaluation process. This has a vital significance for the system of
performance evaluation to be effective and efficient. Performance appraisal
helps to success of the organization in realizing of strategic purposes and
increasing of effective working processes through continuous improvement of
individuals' performance and processes along with focusing on weak improvable
points (Divandari, 1378; 107). With due attention to the fact that Performance
appraisal is one of the main parts of organizational life and could be
consisted of several organizational processes such as measuring of work
performance, establishing of purposes and reward management (Dickinson, 1993;
Llgen, 1993), however many organizations express dissatisfaction about the
designs of their performance evaluation. This situation could be a sign of
failure of performance evaluation as a mechanism for development and
provocation of employees (Fletcher, 1997; 104). It is possible to evaluate
subjects of performance evaluation from various aspects. There are two basic
traditional and modern approaches in this regard. In the traditional approach,
justification and recollection of performance and controlling of the one who
has been evaluated are focused on and it has an instructional style. In modern
approach, education, growth and development of the capacities of the one who is
evaluated, improvement and restructuring of individuals and organization and
its performance, offering of consultative services and participation of beneficiaries,
creating of motivation and accountability in order to improve the quality and
optimization of activities and operations have been considered. The basis of
this approach is composed of identification of the strong and weak points and
organizational elevation. Performance appraisal in the traditional approach is
a tool for justification and recollection of performance, but in modern
approach the major and basic orientation of the evaluation system is inclined
towards growth and training of the evaluated person (Rahimi, 1385; 42).
Generally the agreement among researchers and theoreticians in the field of
performance evaluation is that assessing of reflections and reactions of
evaluation are very important (Keeping & Levy, 2000). For instance, it has
been frequently discussed that Performance appraisal has a positive effect on
employees' behavior and their job route progress in the future. Employees
should experience positive reflections of performance evaluation; otherwise
each evaluation system would be destroyed (Cardy &Dobbins, 1994). Although
Performance appraisal satisfaction has frequently been measured as a reflection
of evaluation, there are no evidences of the manner and reason of measuring of
satisfaction from evaluating of experimental evidences. Despite the existence
of eloquent literature about Performance appraisal and its effect on motivation
and commitment, the behavior and work performance of such relations have been
more supposed than being tested. The purpose of this research is to study the
replacing relations between Performance appraisal satisfaction and results of
employees in the shape of work performance, organizational commitment and
tendency to quit job position. Moreover, the role of intrinsic motivation as a
mediation variable between satisfaction of performance and results of employees
has been examined in this study.
Problem Statement
Appraisal system plays an
integral role in the employer’s performance management process as it translates
employer’s strategic goals into an individual employee’s goals. Assessment
system is aimed at helping in identifying staff capabilities and aptitudes that
match the expectations of their jobs in terms of job knowledge, skills and
attitudes, thus enhancing motivation, morale and job satisfaction.
Objective
of the Study
The
main objective of this paper is to develop a model which explains the two
biases in appraisal ratings, and at the same time explains how its impact on
employees future performances with regard to motivation. Although this paper
might be does not address the problem of the design of an optimal reward
scheme, it does illustrate that a better understanding in the performance appraisal
process is likely to contribute to a better understanding of the working of
incentive schemes through performance appraisal for employee motivation.
Hypothesis
testing
H0: Performance appraisal and employee motivation are
correlated with eachother.
H1: Performance appraisal and employee motivation are
not correlated with eachother.
Chapter 2 –
Literature Review
Performance Appraisal
& Employee Motivation and Loyalty
In the growing age of business and markets, human resource is
the big asset of the organization; if the organization is not keeping well with
its labour work force then it might get into trouble. Employees are the key
features of the growth of the organization. In order to have efficiency,
employee should be motivated and satisfied with their job and have devotion
with the organization. HR professionals are the one who can make it possible to
motivate the employees with the assessment systems by giving them fair
appraisals as per their performance. There is a strong relationship between
appraisal and motivation, job satisfaction and devotion. Keeping aside the main
objectives of performance appraisal, it can be use as a mechanism to create a
completion between employees to get the job done with all the linked targets
and benchmarks (Robert, 1984).
If the performance appraisal has some shortcoming in it and is
actually creating some discrepancy in the process, then it will affect the
motivational level of the employees and ultimately it will affect their efforts
and the risk taking ideas for the betterment of the organization. Also they
will lose interest in the affairs of the organization (Robert & Kim, 2007).
Plus this de-motivation leads the employees to the lack of loyalty and they
will look other options of good job and hikes in the rewards (bonnie, 2002).
Accurate performance appraisal is always preferable but if there
is any inaccuracy then employees always prefers to have accurate performance
appraisal with no hikes in rewards but not an inaccurate system that never
encourages or recognizes their efforts. The assessment process should be fair
because those employees who desires to receive exact performance appraisal over
the period of time and also have all the rewards associated with that appraisal
is the most motivated employee among all and similarly he or she tends to be
more satisfied with his or her job and more loyal to the organization.
Intrinsic motivation
If we consider performing of an activity
by others as a simple definition of management (Blanchard, 1372; 11), we will
accept that such performing of activity by others has a very close relationship
with their motivation. While it seems what causes individuals' activity is a
motivation that has been aroused from their need, so motivation is called
individual's driving motor. We can consider motivation in individuals as a mood
that attracts them to perform a special behavior and action (Golshan, 1372;
22). Intrinsic motivation is the motivation for performing of an activity for
the individual himself. Because of the experience of feeling of satisfaction
and pleasure in performing of that activity (Deci et al, 1989; Arlene, 1997)
motivation is used for a collection of changing relations, whether independent
or dependent, that making clear direction, extent and durability of behavior (
Compel, 1976). In a enthusiasm towards performing of activities that are
necessary for attaining of aims of the intended system.
Conceptual Framework
Managerial Perspective
If we look at the performance appraisal process from the eyes of
the management, they have a much positive approach and views about it as
compared to that of the employees. Some
of the benefits of the performance appraisal
process according to the article which appeared in the May-June
1997 issue of Corporate University Review, the viewpoint of senior executives, performance
appraisal systems are generally regarded as a necessary part of the organization’s
management system. This condition seems to exist because of the widely accepted, generallyunquestioned benefits of performance appraisal systems. If asked, atypical
executive might indicate the following benefits:
- The
system provides an opportunity for performance related discussions that
include the following aims: setting work objectives for the
employee, aligning individual and organizational goals, identifying training anddevelopment needs, and discussing career progression
opportunities.
- Perhaps
the most significant benefit of appraisal is that, in the rush and bustle of daily working life, it offers a rare chance for a supervisor andsubordinate to have "time out" for
a one-on-one discussion of important work issues that might not
otherwise be addressed.
- Appraisal
offers a valuable opportunity to focus on work activities and goals, to identify and
correct existing problems, and to encourage better future performance. Thus
the performance of the whole organization is enhanced.
- Performance
appraisal can have a profound effect on levels of employee motivation and satisfaction - for better as well as for
worse.
- Performance
appraisal offers an excellent opportunity - perhaps the best that will ever occur - for
a supervisor and subordinate to recognize and agree upon individual training and development needs.
Factors
affecting Employees’ Motivation
No one works for
free, nor should they. Employees want to earn reasonable salary and payment,
and employees desire their workers to feel that is what they are getting
(Houran. J). Money is the fundamental inducement, no other incentive or
motivational technique comes even close to it with respect to its influential
value (Sara et al, 2004). It has the supremacy to magnetize, maintain and
motivate individuals towards higher performance. Frederick Taylor and his
scientific management associate described money as the most fundamental factor
in motivating the industrial workers to attain greater productivity (Adeyinka
et al, 2007). Research has suggested that reward now cause satisfaction of the
employee which directly influences performance of the employee (Kalimullah et
al, 2010). Rewards are management tools that hopefully contribute to firm’s
effectiveness by influencing individual or group behavior. All businesses use
pay, promotion, bonuses or other types of rewards to motivate and encourage
high level performances of employees (Reena et al, 2009). One way managers can
instigate motivation is to give appropriate information on the sentences of
their actions on others (Adeyinka et al, 2007).
Chapter 3 – Research Methodology
In order to
study the effect of performance appraisal process on the intrinsic motivation,
a questionnaire designed and distributed among 100 employees of various Department
in Health Sector and will use Statistical tools and testing to get better
results.
Participants
Participants will be individuals age 18-50
located in Karachi.
Study Design
The PA occurred
naturally in this organization. All employees were given a formal PA by their
immediate supervisor once a year on the anniversary of their hire date. A
graphic rating scale format was used for the written appraisal. During the PA,
employees were provided past performance feedback, information on future areas
for improvement, training needs assessment, and any merit increase. In effect,
the PAs were intended by the organization to be both developmental and
evaluative.
Although actual
merit increases were not available for this research, pay and other rewards
(for example, promotions) were tied to performance ratings. Therefore,
investigating the role of performance ratings should provide an indication as
to whether the relationship between perceived evaluative PA use and attitudinal
reactions depends on the outcome of the appraisal.
Measures
The survey was
pilot-tested with the company’s Human Resource Department to ensure that it was
complete, easy to follow, and that the items were not ambiguous. A 1-5 Likert
scale (1=strongly disagree, 5=strongly agree) was used for survey items
regarding PA use and employee attitudes.
Conclusions
In many
organizations, annual performance appraisals form the basis for the rewards
employees get. This study adds to our understanding of the impact of different
PA uses by investigating the relationship between employee perceptions of
developmental and evaluative use and employee attitudes. There appears to be a
strong, positive relationship between perceived developmental use and
employees’ feelings about the appraiser and the appraisal. The relationship
between perceived evaluative PA use and these attitudes is less clear. How assessments
are used within organizations and the perceptions regarding their use are,
therefore, fruitful areas for continued research.
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