MEASURING EMPLOYEES’ PERFORMANCE

The choice of this topic stems from a piece written by one Junaid Korede Agbabiaka (JKA) who alleged that he was wrongly dismissed by GTBank, one of Nigeria’s foremost financial institutions. While there were other HR problems raised by the writer as leading up to the downsizing of one hundred employees, a periodic performance appraisal exercise within the Bank culminated into their sack. It then becomes pertinent for organisations to have a rethink on their performance management system with a view of preventing a public outcry from aggrieved employees and its potential adverse effect on their bottom-line. Consequently, this article intends to discuss efficient and effective ways of measuring employees’ performance.

In simple terms, performance measurement can be likened to the numerous exams we all wrote while in school.  Exams are written every term-end and results cumulated for three terms to gain promotion into the next class. In a more complex business environment however, it isn’t that simple. Organisations operate in a very competitive market and are required to continually improve the quality of their products and services. Huge resources are expended as personnel costs even in the face of current global economic downturns and a very dull business climate. In view of these challenges, it is desirable for employers to measure staffs’ commitment and competence to meet the demands of today’s business world. However, it is important for businesses to get this performance measurement right.

For a performance measurement to be seen as just and not punitive, it must be strategically carried out. One single method of measurement or a blend of methods can be adopted but more importantly it should align with organisational objectives. The tradition tool of measuring performance is the appraisal system. It can be traced to ‘management by objective’ (MBO) business system where objectives are spelt out and reviewed for every employee at the beginning and end of a specified period of time respectively.  Through performance appraisal, an individual’s contribution to a group or department can be determined. It also serves as a means of feedback to employees on how their performance is viewed by top management. Training needs of employees can also be identified using appraisal system. A very interactive process which allows employees to voice out any concern they may have.

As sterling as the characteristics of performance measurement may appear, there are a whole lot of limitations. The fact that appraisal focuses on the individual rather than taking a holistic view on organisational performance, it might have a reverse effect of what it was intended to achieve. Let me explain this. If my promotion at work is dependent upon my performance, it is only natural that my focus will be on those job schedules that will earn me the promotion. Individualism will set in and good work ethics like teamwork and mentoring are neglected. The common saying of “every man for himself” aptly describes this scenario which is counterproductive to the objectives of every organisation.

Appraisers are put in a situation where they ‘play God’ by being asked to rate the performance of the same employees they are meant to motivate and develop. These are two conflicting tasks which can be inimical to the whole appraisal. If I goofed while discharging my job functions, I won’t be forthcoming to my supervisor since I knew it will affect my scores or promotion chances during appraisal time. Appraisals can even degenerate into conflict between the appraiser and the staff being appraised. In trying to avoid any conflict, some supervisors tend to only see the good side of their staff and ignore some faults that could aid growth or development. This is called the halo-effect.  Research has also shown that appraisal ratings are influenced by biases like ethnicity, gender and physical attractiveness.

It is interesting to report that some organisations have reacted to these biases by developing ways of gathering data on employees using multiple sources. One of such designs is the ‘balanced scorecard’, a management measuring style which monitors the progress of all critical units within an organisation in relation to its strategic objectives. The ‘360 degree’ appraisal method is also another way of eliminating biases in appraisals. It involves ratings from superiors, subordinates, peers and customers. The beauty of this approach is that an employee’s career progression does not rest on one single person. Employees are also highly involved in the entire process and it’s a tool which checks behaviour and performance.

From the above, it was obvious that Junaid Korede Agbabiaka (JKA), who recently lost his job with GTBank, was a victim of the traditional appraisal system. This piece is not aimed at apportioning blames but to highlight more credible ways of measuring performance for adoption by businesses in Nigeria. Attention should shift towards an organisation-based performance rather than the individual. Financial institutions in Nigeria have also developed a crude way of disengaging their employees. A situation where an employee is denied access from logging into the bank’s system without notice is not right and only goes to portray the image of the organisation in bad light. On the flip side, access denial could forestall a possible fraud from a disengaged staff. In an industry that is characterised by stiff competition, this is not the kind of publicity that GTBank wants at this time. There are better ways of communicating to staff even when their services are no longer required.

Bashir Mudi Baba can be reached on Twitter via handle @El_De_Bash

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7 thoughts on “MEASURING EMPLOYEES’ PERFORMANCE

  1. Dear Bash,

    I quite agree with your thought on this. In order to eliminate this urgy scenario that occur between GTB and JKA, organisation should ensure that they communicate each employees key performance indicators at the beginning of the financial year. Employee should be made to signed off the KPI when procedure and expected outcome has been agreed with the employee.

    GTB appraisal system needs to change to rewarding teams instead of individuals and this is the worldwide trends. The duty is for team leader not to allowing social loafing in his team.

    The JKA-GTB issues confirmed some of my hypothesis in my present research on Envy and harming behaviour. Using samples of 240 employees in Spain i found out that employees that is predisposed to envy will harm individuals and organisation more when there is injustice in performance appraisal outcome and procedure.

    JKA has harmed GTB by publishing his grievances on social media and public domain which resultant effect of negative press and negative brand perception of GTB brand in recent days.

    My advice to GTB is as follows:

    1. They should redesigned the appraisal system incorporating balance score and 360 degrees feedback.

    2. Organize Employee engagement programme with the aim to ensure that each employee has a positive relationship with boss.

    3. In order to combat the negative effect of envy GTB should ensure fairness in procedure, and outcome of performance appraisal.

    4. GTB should create a framework where aggrieved employees can appeal the decision of performance appraisal system this might help to discourage washing the dirty linen of GTB in public.

    5. GTB should organize emotion management training. This training programme might achieve two main objectives. firstly, It will communicate to employees that they are valued member of the organization and secondly, it will help in combating dysfunctional emotion reaction that might occur in context of daily workplace issues that seems not to be fair.

    Thank you.

  2. Yes O Bash, the traditional appraisal does not improve the employee or develop the corporation. I will find a way d mgt of my organization go through this piece. Great ! Welldone.

  3. I consider GTB’s response to this accusation as an exaggerated focus on public impression management – which is not wrong, but more attention should be dedicated to its internal mechanisms. The publication by JKA was more or less an opportunity for other staff members to air their accrued grievances and dissonances especially with the organisation’s appraisal methods. If as an organisation, they decide to layoff 100employees in a year, due to low performance, then I am skeptical about the validity of your recruitment processes. More attention should be devoted to cognitive ability assessments in their recruitment exercises as it is a powerful predictor of future Job performance. Besides, with my current knowledge in Management Psychology from the University of Nottingham, Malaysia, I am more concerned about the psychological implications of the layoff on other staff members of the organisation. You don’t solve one problem by creating two other serious implicit problems. GTB has created an organisational climate of fear and insecurity largely characterized by the dubiety of the employer-employee ‘psychological contract’. And you cant get employees to perform maximally by doing that. Imagine sacking an employee without any prior notice but by him/her not being able to login to his/her station. What kind of signal is that? For a reputable organisation like GTB, Organisational productivity i know is a paramount priority to the board and management, but you must not forget that customer loyalty is a direct function of employees’ satisfaction (which includes security). Employees’ satisfaction = Customer’s Loyalty = Organisational Productivity. HRMgrs in Nigerian Organizations must wakeup to the consciousness and reality of the psychological implications of their decisions on their employees. Employees are not electronic machines, they are embodiments of psychological processes.

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