The greatest asset of any organization is the people that work in it, its human resource. Hence for any organization to grow, it needs to support the growth of the people involved in it. However, one of the most difficult to implement but most fundamental features of any human resource management; yet very relevant to individual and organizational growth is performance appraisal (Obisi, 2011). Performance appraisal is a process of setting employees individual targets, monitoring those targets, measuring the results through evaluation and either correcting or rewarding the employees performance. In other words, appraisal is the evaluation of employees work. The main objective of any performance appraisal is to give positive or (negative) feedback to the employee on ways to improve subsequent performance, thereby to enhance productivity and efficiency in an organization’s performance, whether public or private. In addition, it is one of the most essential aspects of human resource management subsystem in many third world countries. Despite its significance and prevalence, there is a wide gap between theory and practice hence its implementation and effectiveness has been highly controversial.
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Public service sector in Nigeria currently uses the Annual Performance Evaluation system (APER). This is based on the overall evaluation of employee’s contribution to the organization on yearly basis. However, the system is ineffective and inefficient because evaluation is not conducted on regular basis for maximum output. Consequently, the system creates room for subjective evaluation and favoritism in the sense that there is no proper data base for the recording of staff activities and tasks are not time dependent. Hence it becomes difficult for supervisors to evaluate objectively and accurately measure deliverability. For example, in the United States the Civil Service Reform Act (CSRA) of 1978, the last legal document on Civil Service Reform, opted for an objective-based performance evaluation system in place of the numerous informal subjective systems (Perry, 2008).
In designing a conceptual framework for an effective appraisal system, there must be clear and measurable job specifications. The employees should be educated on what is expected of them to do and how their actions will positively or negatively affect their evaluation. The employees should also be aware of the goals and mission of the organization and how they will contribute in achieving these said goals and objectives. Furthermore, there should be participatory workforce attitude; whereby communication is carried out with dual categories of employees in getting their opinions on the current appraisal system and how to improve it.
Nigeria’s public sector appraisal ratings are mostly inflated to favor certain employees and others do not get true feedback about how well they have performed. This is due to the fact that, performance appraisal is seen as the supervisors’ exclusive role and opportunity to reward loyalty and punish those considered rebellious. In essence, the process over looks its fundamental objective of development and growth while relishing solely on its evaluative aspect. Another major issue has to do with the fact that the supervisors lack the knowledge and coaching on how to conduct an effective appraisal, rather they follow the sectors ongoing culture. Organizational culture has a strong influence on how performance evaluation is applied. There is need for the appraisal system to be cognizant and supportive of the working environment (Mohman et al, 1989). Furthermore unfair appraisals demoralize the employees thereby leading to underperformance which automatically affects the public sectors contribution to the economy thereby stagnating the economy’s development. As noted by Oh and Lewis (2009) unfair appraisal systems has no positive effect on employees morale hence failing to adequately motivate them to perform better
1.2 Purpose of the study
The purpose of this research paper is to critically examine the Nigeria’s civil servants performance appraisal system in terms of objective criteria and propose suggestions for its improvement. The paper has four main goals namely:-
To review scholarly arguments on the concept of performance appraisal available in academic literature;
To present an overview of the Nigeria’s public sector performance appraisal system and enumerate on the challenges currently facing the appraisal system used in the public sector.
To identify the importance and benefits derived from fair and objective appraisal system;
To propose measures to improve the current system in order to improve public servants efficiency and overall sector’s productivity.
1.3 Research questions
How is performance appraisal defined by experts in academic literature?
What is the conceptual framework of implementing an effective performance appraisal system in the civil service sector?
What are the best Standards of Performance appraisal and how can it be applied in Nigeria’s public sector for utmost productivity?
How are the current performance appraisal systems working?
Why do performance appraisals elicit adverse reaction?
1.4 Methodology
The study will be based on extensive literature review using secondary data; articles, journals, books, Government publications, analysis of the APER forms, and outcomes of unstructured interview conducted with officials of Federal civil service Commission, which is the agency saddled with the responsibility of appraising Federal civil servants in Nigeria. There is no definite theory to the literature review, rather it is used as an aid to gather and analyze data for conceptual framework in answer to the research questions. Furthermore, some of the information will be based on personal work experience, having been in the public sector for the past five years presents participant observation based on first- hands experience in the performance appraisal process.
1.5 Structure of Study
The study has been organized into four parts; the introductory part covers the background, purpose of study, questions to be addressed and the methodology. The next part covers literature review which seeks to answer the research questions based on analyses and reviews of available literature on performance appraisal and the current appraisal system used in Nigeria’s Civil service. The secondary data will be used to frame a conceptual model that will be used analyze how the current appraisal system is working in Nigeria. Finally, the study will be concluded with implications and recommendations for improving the current appraisal system used in Nigeria’s civil service. It will also discuss limitations for the research and need for further additional study.
Chapter: Two
LITERATURE REVIEW/CONCEPTUAL FRAMEWORK
2.1.1 Introduction
This chapter reviews literature based upon the research objectives and builds the foundation of a theoretical framework by answering the research questions. It begins with the historical background of performance appraisal, how the appraisal process was introduced. It then elaborates on the definition of performance appraisal and why it is conducted. This is followed by a literature review of the participants involved in the process and how the evaluation is conducted. It further seeks to examine the appraisal process in the Nigeria’s civil service and the challenges facing the system. Finally, the information generated will lead to the building of a conceptual model.
2.1.2 Historical Background of Performance Appraisal
Institutionalization of performance appraisal started as far back as the industrial revolution when it was used as a means of measuring organizational efficiency (Fandray, 2001). Wren (1994) affirmed that Performance appraisal was incepted when Robert Owen used wooden colored block to measure the achievement of employees working in the cotton Mills in Scotland at the close of work hours. During that era, it was utilized as a disciplinary mechanism for punishing poor performance (Kennedy & Dresser 2001). This resulted in the negative notation of the appraisal system which turned out to be despised by both the appraiser and the appraisee. As confirmed by Robert and Pregitzer (2007) “performance appraisal is a yearly rite of passage in organizations that triggers dread and apprehension in the most experienced, battle hardened manager”. The above quote summarizes the extent to which the appraisal process is disliked by the evaluators. Subsequently, organizations tried to refine the methods linking it to other administrative matters including reward, promotion, training and so forth, arguing that employees achievements should not only be measured but evaluated and managed (Kennedy & Dresser 2001). Despite the historical perspective, appraisal is both inevitable and universal. There has been several analysis and wide criticisms of the effectiveness and use of PA within the organizational context but up to recent times the issue is still being debated among scholars, academicians and professionals and NO system has been successful in meeting the desired goal.
2.1.2 Definition of Performance Appraisal
Performance appraisal is a means of measuring or assessing employees’ achievements within a stated period of time using reliable measurement criteria with the ultimate goal of providing information to superiors on how to improve employees’ effectiveness. There are tons and wide range of literature on performance appraisal. The term has been synonymous with performance management, performance review and performance evaluation. In the book “Strategic performance management” the author defined Performance appraisal as “a systematic & holistic process of work, planning, monitoring and measurement aimed at continuously improving the teams and individual employee’s contribution to achievement of organizational goals” (Akata, 2003). This depicts that performance appraisal is used as a means of establishing future goals, monitoring employees’ progress based on specified job description, and measuring performance, teamwork and achievements based on specified tasks that can be linked with organizational goals and objectives. Furthermore, performance appraisal is used to formally determine employees’ effectiveness and contribution (Ikramullah et al, 2011). In addition, Fletcher (2001) opined performance appraisal as a means by which organizations develop competency, improve employee motivation and achieve equitable allocation of resources. In essence, performance appraisal achieves multiple purposes from measurement to motivation and resource allocation. As noted by Cleveland, Murphy, and Williams (1989), performance appraisal systems can be used to motivate employees through remuneration, promotions, retrenchment, and the improvement of skills, competence and expertise. In addition, performance evaluation can be said to be a process of measuring employees contribution which turns out to be beneficial, both to the staff and the organization at large if carried out properly.
Moreover, Seidan, Sally and Jessica E. Sowa (2011) believed that the ultimate objective of any evaluation procedure is aligning individual goals and objectives with organizational objectives and priorities while individual performance should be reflected in how they contribute to organizational growth and development. According to Bassey, Esu and Inyang (2009), performance appraisal system is a means of investigating employee achievement over a certain period of time for achieving organizational goals. Consequently, performance appraisal is a means of knowledge sharing among subordinates and superiors to adequately measure the progress of the employee which will aid in making strategic human resource decisions.
In addition, Atiomo (2000) agrees with Fajana (1997) that performance appraisal is a method of assessing the human resource capabilities and skills and also to identify areas of improvement (Fajana, 1997; Atiomo, 2000; Obisi 2010). Atiomo (2000) noted that in order for performance appraisal to be effective there must be clear job description hence every individual needs to know what his role is in the organization. It can be deduced that performance appraisal is the process through which an organization collects individual’s data in terms of strengths and weaknesses in order to explore ones opportunities and potentials for development and growth while also determining future threats that can be harmful to one’s career and the organizational setting at large, which is subsequently communicated to the individual.
2.1.3 Objectives of performance appraisal
The primary aim of performance appraisal is to improve the effectiveness of an organization by assessing the impact of individuals employed in it (Cumming, 1972). Performance appraisal generally plays two dominant roles: judgmental and developmental (Cummings and Schwab, 1973; Daley, 2002; Condrey 2010). Although, these two categories are often seen as potentially conflicting, they both share the ultimate goal of enhancing productivity. As part of larger performance evaluation system, organizations conduct appraisals to serve the purpose of improving employee effectiveness (Denisi and Robert D. Pritchard 2006).
Development approaches focuses on within-person decisions, individual potentials and adding value to the employee rather than on his or her current skills and capabilities. The approach tends to link performance with training, development opportunities or potential extrinsic rewards. Unfortunately, even in the most objective appraisal system linking training to evaluation proved difficult (Daley, 2002). This approach aids the employee in knowing his capabilities and advice on how to explore his hidden abilities. Categorically speaking, the evaluator plays the role of a guidance and counselor. In essence, the organization needs to determine the benefits it can accrue from enhancing the employee’s hidden potentials. Hence it is important to consider the question of development for whom?
Judgmental approach focuses between-person decisions, pursuing the management system or command-and-control model of authority (Daley, 2002; Condrey 2010). The role is to measure performance for the purpose of making administrative decisions regarding promotions, rewards, merit pay, punishment and other uses such as test validation criteria. The supervisor plays the role of a judge and uses his authority to make decisions that will improve employee performance. Merit pay is appealing to most public organization as a means of cutting cost and improving productivity however, the practice is somewhat different (Lovrich, 1987; Perry, Patrakis, and Miller, 1989; Daley 2002). The reward structure imbedded in the approach even though it is essential has proved to be an important limitation among public sectors due to resource constraint and bureaucratic procedures.
In addition, feedback is very critical in the appraisal system because employees need to know the result of the evaluation. They hope to get responses on enhancing their performance from the appraisal process. There is also the desire for objective appraisal likewise any perceived unfairness and subjectivity can ultimately demotivate employees this can lead to potential conflict between individuals and organizations (Murphy and Cleveland 1995; Daley 2002; Condrey 2010).
There is also the desire of development and reward both by the organizations and the employees. Regrettably, one cannot go with the other, hence the achievement of development may hinder reward and vice versa. If individuals showcase an excellent performance, they may receive reward and miss out on the needed training that will boost their careers. Adversely, in order to develop employee potentials, organizations’ may miss out on rewarding excellent performance which can further motivate employees (Longenecker and Nykodym, 1996; Daley 2002).
Merging developmental and judgmental purposes may prove to be the best solution to an effective appraisal system. The supervisor needs to be a coach as well as a judge (Roberts, 2003). Where there is an ample degree of employee trust and loyalty, objective measurement criteria and participatory work force attitude, such a combine system can prove to be effective (Daley, 2002). However, due to the conflicting role of the two approaches, it may not be possible to merge judgment and development in one evaluation process (Daley, 2002; Denisi and Pritchard 2006). Intellectually, previous research has indicated that, the purpose of appraisal influences the supervisors’ decision in the evaluation process (Murphy and Cleveland, 1995; Bowman, 1999; Daley, 2002). Hence, even with the most objective appraisal criteria, the purpose for which an appraisal is to be conducted dictates the direction of the evaluation outcome.
Approaches
What it focuses on
Outcomes
Developmental
Individual capacity; value addition & exploring hidden abilities
Training, Rewards and improvement opportunities
Judgmental
Interpersonal and relational skills & command-control model of authority
Enhancing effective administrative decisions
Combination of judgmental and developmental
Decision making and mentorship
General leadership and personal effectiveness development opportunities
Table. 1 Objectives of Appraisal
2.1.4 Participants in performance appraisal
Conventionally, performance appraisal is conducted by direct supervisors because they are in the best position to monitor and assess their subordinates (Kondrasuk, Riley, & Hua, 1999; Daley, 2002; Kondrasuk, 2012). This method is widely used and estimated to occur in almost ninety percent of the cases (Daley, 2002). Performance appraisal is on one hand seen as a management system tool in establishing power and authority and on the other hand as a strategy to strengthen employee-supervisor relationship through good communication and knowledge sharing. In addition to the aforementioned method, Daley (2002) noted that an organization can employ the use of agency insiders (e.g., self-appraisal, peer review, subordinate appraisal, and multi raters) or the employment of outsiders (e.g., personnel staff, consultants, assessment centers, customers and clients).
The self-appraisal is an exceptionally useful technique whereby the employee assesses his or her own achievements since one knows the accurate information of the performance. Although questionable in a judgmental approach due to self bias and subjectivity but quiet useful in developmental appraisals (Murphy and Cleveland 1995; Daley, 2002). Self-appraisal provides the organization with direct information of employees’ apparent needs for enhancement which is very vital in a developmental setting. In essence, it is important to understand employees’ way of thinking when applying this method because they tend to think more of their potentials -what they can do rather than present performance-what they did (Daley, 2002).
Peer review approach employs several appraisers, whereby employees are appraised by their colleagues. Research indicates that evaluations from peers are just as precise as those conducted by the supervisors (Murphy and Cleveland 1995; Daley, 2002; Kondrasuk, 2012). For the reason that peers are more in contact with the employee, witness the day to day activities and observe behaviors that would be overlooked by a supervisor, the evaluation will tend to be more inclusive. Peer ratings often face subjective concerns because they are disliked by employees due to lack of adequate training and guidance in the process. Furthermore, there is often the fear of making a negative impact on individual careers and relationships.
Appraisal of supervisors and managers by subordinates creates enormous apprehension from both parties. This is as a result of its anti hierarchical status which tends to undermine authority patterns (Daley, 1992; Murphy and Cleveland, 1995; Daley, 2002; Condrey, 2012). The nature of the subordinate appraisal makes it’s very difficult to adopt and it’s rarely used by organizations even though; it is strongly recommended and advocated by some scholars. Subordinate appraisals can aid enhance the quality of the working environment and also provide mangers with relevant feedback that will improve their workforce attitude. It can also portray the organization as a participatory leadership structure whereby decisions are made from bottom-up not only top-bottom.
Furthermore, team management approach employs the use of multi raters. This is a collaboration of supervisors and managers from different units working together on an appraisal panel in order to reduce rater errors and also improve fairness and objectivity (Edwards, 1991; Daley, 2002; Condrey 2012). Team management encourages knowledge sharing about skills and competencies and also aids in relationship building which leads to cooperation and coordination. This method has the highest chance of integrating both judgmental and developmental approach within a single appraisal process. The role of coach, counseling and advocate can be performed by the direct supervisor while the judgment role carried out by other team managers (Daley, 2002).
Outsourcing of the appraisal process or participation of outsiders whereby experts are brought in to evaluate employee performance is an infrequent approach. Employees are evaluated based on their traits and characteristics which is basically a job analysis approach that can possibly lead to litigations (Mohrman, Resnick-West, and Lawler 1989; Daley, 2002; Condrey, 2012). In addition, clients or customers can also be incorporated in the appraisal process because they are the receivers of service hence they can provide adequate information about employee performance and relationship. This approach is more familiar in public organizations and can depict transparency and accountability.
The combination of supervisor, subordinate, peer and self-ratings are the basis of 360-degrees performance measures. This measure which seeks to provide a more balanced form of appraisal has lately ignited significant interest among public administrators and scholars. Similar to other techniques, 360-degree appraisal is only useful when focused on job-related components and is likely to be effective when employed for developmental purposes rather than into a judgmental system. Focusing on improving the value of employees, the impact of 360-degree feedback can be highly successful due to its participative technique (DeNisi and Kluger, 2000; Ghorpade, 2000).
In conclusion, if the participants are not adequately trained on the appraisal process, then there will be errors in the result. Evaluators often do not possess the necessary skills needed to conduct the appraisal (Vinson, 1996;Grote, 1996; Fletcher, 2001; Kondrasuk 2012). Hence most appraisals are not free from errors and it is not a surprise that the results tend to be less than ideal while the process most often than not fails to succeed.
Participants
What is appraised?
Why they appraise
Direct Supervisors
Personality traits and effective delivery of Job responsibilities
Assess subordinates personal effectiveness and performance
Self Appraisal
Individual strengths, weaknesses, achievements and potentials
Accurate information of performance & needs for enhancement
Reduce bias & increases perception of fairness
Peer Review
Attitude, team spirit and personality traits
Inclusive evaluation and feedback mechanism
Subordinate Appraisal
Supervisor-subordinate relationship, delegation and general leadership qualities
Improvement in quality of working environment and management performance
Multi Raters
Skills and competencies
Reduce subjectivity in staff performance assessment and promote excellence
Outsourcing
Personality traits and characteristics
Transparency and accountability
3600
Job-related components
Participatory workforce attitude and objectivity
Table. 2 Participants in Appraisal
2.1.6 Procedures for Evaluating Performance
A transparent and continuous process for evaluating employee would be much appreciated by individuals and the organization at large. The best and most widely acceptable standard of measuring performance is job-relatedness, which can be achieved in two ways-“enabling supervisors to discriminate between employees solely in terms of their job performance, and the organization must be able to prove or demonstrate the existence of that relationship” (Daley, 2002; Condrey 2012).
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In addition, Marmora (1995) and Saltz (1996) noted that performance standards should be established at the initial stage of performance evaluation. The standard should then be subsequently communicated to both the evaluator and the employees in order for them to know what is expected of them to do. This is followed by the actual evaluation process, comparing of the result with the standard set, and giving feedback to the employee (Obisi, 2011). Daley (2002) & Condrey (2012) opined that reliable, practical and controllable criteria must be taken into account when selecting performance measures. Reliability in terms of generating consistent results; practical in terms of availability for users; and controllable in form of representing individual behaviors.
The effectiveness of all appraisal system is determined by the performance standards. Hence standards must be established according to individual job description which should be tied to organizational goals and objectives. Furthermore, these standards should be a written document which will make it legally binding and objective. Failure to align performance standards with organizational goals and objectives leads to misunderstandings, poor morale, lack of job satisfaction, ineffectiveness, and confusion (Daley, 2002; Condrey 2012).
Knowledge, skills and abilities, work ethics, personal traits or characteristics and results all can be used to assess performance (Milkovich and Boudreau, 1994). Even though, knowledge, skills and abilities are difficult and costly to measure due to the fact that they are inherent in an individual not specific to the job itself but they signify the minimum requirement needed for optimum job performance.
The two most objective performance appraisal instruments (management by objectives and behaviorally anchored scales) are layered with the foundation of behaviors and results (Murphy and Cleveland 1995; Daley, 2002; Condrey, 2012). Behavior is the manner in which individuals conduct themselves while performing on their jobs; results are the effect brought about by those conducts. The use of behavior is generally preferred in the public sector while the private sectors are result oriented (Daley, 2002).
Behaviors are mostly used in the public sector due to the nature of the organization which encourages and incorporates teamwork. Ultimately, organizational culture, organizational climate and nature of the job influence the direction of the appraisal procedure (Murphy and Cleveland, 1995; Daley, 2002; Condrey, 1994 & 2012).
On the contrary, performance appraisal systems tend to measure extreme performances accurately while failing to differentiate middle-range performance, hence individual behaviors may not be accurately evaluated (Gote, 196; Kondurasuk, 2011). Many appraisal systems are ineffective and highly unreliable due to rating errors (Roberts, 1998).
PERFORMANCE EVALUATION CRITERIA
Establish Performance Standards
Communicate performance expectation to employees
Measure actual performance
Compare actual performance with standards
Discuss appraisal with employees
Indicate corrective action when necessary
fig1. Source: The Evaluation Process Adapted from Mamonia C.B., 1995and Obisi Chris, 2011.
2.1.7 Techniques of Performance Appraisal
Performance appraisal research has primarily focused on perfecting the appraisal instrument and measurement issues which has led to the system being built around a central technique (Daley, 2000). Basically, there are two appraisal techniques- subjective based procedure which deals with observable acts and the objective based procedure which defines performance according to tasks and targets (Orpen & Christopher, 1997; Daley 2002). The type of technique used drives the appraisal process and contributes to organizational development.
Nevertheless, due to the inherent problems associated with the subjective techniques in terms of lack of communication, inter-rater differences, errors and inability to adequately explain to others the procedure of the appraisal, objective technique is most preferred. Hence, behaviorally anchored rating scales (BARS) and management by objective (MBO) approaches are most often used in place of subjective essays, graphic rating scales, forced choice checklist and forced distribution interpersonal comparison (Daley, 1997 & 2002).
Behaviorally Anchored Rating Scales: Behaviorally anchored rating scales are a modernized or extended version of the subjective graphic scale. They are an apparent attempt to transform the graphic rating scale into an objective appraisal in terms of level of performance and performance objectives. In other words, they are corrective measures for many of the subjective concerns that cloud the validity and hinder the use of graphic rating scales (Daley 2002; Condrey, 2010).
Even though BARS have received much attention in the private sector, they are also relevant to governmental settings because it is process-oriented rather than result-oriented. This is perhaps even more characteristics of public sector than private organizations. Teamwork and conditions of fragmented authority which are more likely to occur in government agencies are factors that inherent in the BARS approach to performance appraisal.
This technique specifies definite computable, quantifiable and observable job behavior on a range and the employee is rated on the basis of his/her behavior along the continuum. The scales combine elements of critical incident and graphic rating approach. In anchoring behaviors with specific examples BARS has two main options to choose from- behaviorally expected scales (BES) which represents managements judgment call as to what can be done and the behaviorally observed scales (BOS) which anchors its behaviors firmly in the reality of the situation (Latham and Wexley, 1994; Daley 2002; Condrey 2010).
Furthermore, the BARS represent a passive application of participatory leadership where employees are incorporated in decision making process. For the approach to work it must be accompanied by bureaucratic immunity and structural accommodation. Bureaucratic immunity prevents ordinary standards procedures and control process which can thwart change and success. Structural accommodation employs a high degree of autonomy in terms of decision making and resource allocation (Thompson, Hochwarter, and Mathys, 1997; Daley, 2002; Condrey, 2010).
Management by Objective Appraisal system:- The management by objective approach originated as a process whereby managers can transform their strategic plans into implementable action (Daley, 1992; 2002). In this approach, participation is central; goals and objectives are worked out based on mutual understanding. This enhances teamwork and relationship building among the supervisors and the employee. In addition, there is constant communication between the participants, prior
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