Performance Is Key Aspect Behind The Success Or Failure Of A Firm


Performance is a key aspect behind the success or a failure of a firm or organization. The success or failure of an organization depends upon the performance of the employee. This requires that "all noses are pointing in the same direction", as every person in the organization contributes to the company objectives via his or her activities (Flapper, 1995). However, there are a lot of factors that affect the performance among the employee in a firm or organization. The hierarchical system inside the company has always been a source of parent-child dynamism. Employees have developed a considerable amount of dissatisfaction due to this parent-child dynamism. Since, people may not function properly and learn well under the atmosphere permeated with judgment; it has been a painstaking job these days for managers to find ways for better performance in a firm or organization. A newer and better managerial tool should be developed and implemented because under a hierarchal system, someone may feel dominated. Hence to motivate the employee is very crucial to get the job done inside an organization. Hence a deep understanding of performance management process inside a company or organization is one of the utmost concerns of this research. Since TESCO is Britain's leading retailer, is one of the top three retailers in the world, and is very convenient to the researcher in terms of feasibility, availability, practicality and locality; the researcher has chosen TESCO as a target research area.

Purpose/Aims/Rationale/Research Questions

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My objectives are twofold. First I shall investigate the factors that are responsible for performance of employee in TESCO. In doing so, it is assumed that the most important factor that effects the performance is TESCO shall also be investigated. Secondly, I shall investigate how performance is controlled and monitored in TESCO. Although there are a lot of theoretical basis for performance management, where different kinds of researches have done in different organizations, there are very few researches done in TESCO. Since, TESCO is a well established retailer that provided thousands of jobs every year, research of TESCO could play a vital role to uncover important insights about performance management.

Research questions

What are the factors that affect the performance of employee in TESCO?

What is the most influential factor that affects the performance of employee in TESCO?

How is the performance of employee controlled and monitored in TESCO?


H0 : Motivation effects the performance.

H1: H0 is not true.

H0: Effective Communication has a positive relationship with performance

H1: H0 is not true.

Review of Literature

Performance depends on education, training and experience as it could be slow and a lengthy process. However, motivation can be improved quickly. Below listed are some steps for motivation.

Positive reinforcement/ high expectations

Effective discipline and punishment

Treating people fairly

Satisfying employee needs

Setting work related goals

Restructuring jobs

Base rewards on job performance

The success and continuity of an organization depend on its performance, which may be defined as "the way the organization carries its objectives into effect". This requires that "all noses are pointing in the same direction", as every person in the organization contributes to the company objectives via his or her activities. A good manager keeps track of the performance of the system he or she is responsible for by means of performance measurement (PM). His/her staff carrying responsibility for certain activities within the system, need PM to see how well they are performing their tasks. This also holds for the employees actually executing the various process steps. So performance indicators (PIs) are important for everyone inside an organization, as they tell what has to be measured and what are the control limits the actual performance should be within (Flapper et al, 1995)

What you measure is what you get. Senior executives understand that their organization's measurement system strongly affects the behaviour of managers and employees. Executives also understand that traditional financial accounting measures like return-on-investment and earnings-per-share can give misleading signals for continuous improvement and innovation-activities today's competitive environment (Norton & Kaplan, 1992).

3.1 Theories of Motivation

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There is an old saying that you can take a horse to water but you cannot force it to drink, it will drink only if it is thirsty. It will only drink water if it is thirst or in other words if it is motivated to drink. Whether working in a simple restaurant or in a extremely competitive business market, they must be motivated or driven to it. Performance is understood as a function of ability and motivation.

Job performance= Æ’ (ability) (motivation)

3.1.1 Definition of Motivation

A motive is a reason for doing something. Motivation is concerned with the factors that motivate people to behave in certain ways (Armstrong, 1999: pp-22). Motivation is incidental to or defined by goal directed behavior (Locke Et al, 1995). It means that motivation is concerned with strength and direction of that behavior. In other words it means that motivation takes place when people expect that an action is probable to lead to an achievement of a goal and a valued reward and will satisfy their needs and desires. Well-motivated people are therefore those with clearly defined goals who take action which they expect will achieve those goals (Armstrong, 1999: pp-22). It is undoubtedly clear that motivation affects the performance. Hence, motivation among the employee is a very crucial driving factor in a firm or an organization.

The process of motivation

The process of motivation can be modelled as shown in the figure below. This model is grounded on the needs of a particular person where it shows that motivation is a result of conscious of unconscious recognition of unsatisfied needs. Needs create wants, which means desire(s) to get goods or obtain something.

2. Establish Goal

1. Need 3. Take action

Attain Goal

(Fig 1.1 Source: Armstrong, 1993)

Goals are then established which will satisfy these needs and then a action is taken in the expectation that the action will facilitation the achievement of the particular goal imagined/setup by him/her. If the goal is achieved, then the need shall be satisfied and the behavior will repeat next time when same kind of need emerges and if the goal is not achieved then the behavior or action is less likely to be repeated.

This model illustrates the motivation process from a individualistic perspective. It is based on the motivational theories related to needs (achievements), goals, equity, behaviour modelling (reactance) and expectancy. It is also influenced by three concepts relating to motivation and behaviour: reinforcement (Hull, 1951), homeostasis, intrinsic and extrinsic theories. This model can be used to illustrate a process of motivation which involves setting of corporate goals that will likely be able to meet the individual and ultimately organizational needs and wants and encourage the behaviour required to achieve those goals.

3.3 Theory of Performance

A generalized theory of performance does not exist. However, there are theories of performance built on specific disciplines of studies such economics, psychology etc. Organizational behaviour describes as the criterion problem. We might want to extend it to the study of HRM. Performance management is a concept that has been spreading in developing countries relative to developed countries. There are various ways of understanding PM, from different aspects like theoretical, practical etc. However most of them agree that PM is a process of optimal management and allocation of resources that will help in achieving a common goal in an organization. (Edis, 1995) argues that PM is a management process which people and their jobs to strategy and objectives of the organization. On the other hand Slater et al (1998) argue that PM is a 'value adding' process of organizational performance. PM is defined within private sector as systematic and data oriented approach to manage people's behaviour at work that relies of positive reinforcement as a major as a major way of optimising performance.

Who are the real stake holders of performance and is performance same as outcomes? Generally performance can be seen as a company dominated criterion but outcome can be seen in a much broader sense and depends on a lot factors. These factors can be for example, environmental issues, job satisfaction, contribution towards the community or society etc. In an organizationally determined performance criterion, there might be a risk that some of these factors are ignored.

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PM is also defined as an integrated set of planning and review procedures, which cascades down through the organisation to provide a link between each individual and the overall strategy of the organisation (Rogers, 1994). (NAHT, 1991) describes PM as a mix of managerial strategies and techniques via which jobholders have better understanding about what the organization is trying to achieve; understand what is expected from their job and are provided with regular feedback on how they have been doing and have a continuous support from their managers and have an opportunity to understand, and judge their performance.

PM is not just appraisal; neither is it just incentives and financial rewards. PM is a much broader concept. Performance appraisal could play a vital role in performance management but it is a part of an integrative approach, incorporating process, attitudes and behaviours that will ultimately produce effective and coherent strategies for raising levels of effective individual performance.

4. Research Methodology

4.1 Research Philosophy

Different research philosophies have been seen in earlier research. In business researches broadly two different research philosophies have been classified, positivism and interpretivism. The two paradigms differ from each other in the way they answer the following questions (Figueirido & Cunha, 2007).

a) The ontological question enquires about what can be known;

b) The epistemological question looks into what is knowledge and what knowledge can we get;

c) The methodological question enquires about how we can build on that knowledge;

d) The ethical question asks what is the worth, or value, of the knowledge we build.

Orlikowski and Baroundi (1991 p.5) described the differences between what is traditionally viewed as positivist or interpretive as follows:

"Positivist studies are premised on the existence of a priori fixed relationship within phenomena which are typically investigated with structured instrumentation […]positivist studies are characterized by evidence of formal propositions, quantifiable measures of variables, hypotheses testing, and the drawing of inferences about a phenomenon from the sample to a stated population […] interpretative studies assume that people create and associate their own subjective and intersubjective meanings as they interact with the world around them. Interpretative researchers thus attempt to understand phenomena through accessing the meanings that participants assign to them […] reject the possibility of an objective or factual account of events and situations, seeking instead a relativistic, albeit shared, understanding of phenomena "

Positivistic and interpretative research philosophies are so different to each other that they are almost mutually exclusive to each other in terms of Assumptions, roles of researcher and the characteristics . According to a positivistic approach the researcher is "outside the glass" and the research occurs "behind the glass" where the researcher observes the phenomenon without interfering it. However, the case is quite different in interpretivism which generally acknowledges the researches participation and interaction with the subject and attempt to reflect their bias as integrals to insights derived (DeLuca et al 2008)

The research we are trying to undertake requires an interaction of the researcher with the subject as it requires observation of a social phenomenon. "Interpretive research can help researchers to understand human thought and action in social and organizational contexts; it has the potential to produce deep insights into information systems phenomena including the management of information systems and information systems development" (Klein and Myers 1999 p.67).

4.2 Approach of the study

The exploratory nature of the problem makes the researcher to follow case study method. Although survey research has been very popular among the social science researchers, this kind of research may not provide a deep insight about a phenomenon. Field studies and interviews during case studies can provide richer data that that cannot be achieved via survey research method and can measure the casual effects more closely (Abrahamson, 1983). Although the research sounds more qualitative, considerations shall also be given to validity and reliability of the data. To be clear, the current research study is qualitative in nature but it shall follow both qualitative frameworks in data analysis. Data triangulation could serve as a medium to validate the data.

Primary data shall be collected through questionnaires and interviews and secondary data can be collected through documentations, and other source of information, especially internet.

4.3 Qualitative and Quantitative research approach

Qualitative research explores attitudes, behaviour and experiences through different methods such as interviews or focus groups. It attempts to get in-depth opinion from the participants. Since it is about attitude, behaviour or experiences, the sample size is relatively low in this kind of research. Since the research topic is also about behavioural studies, qualitative research can be quite useful in addressing the research problem.

Quantitative research generates statistics through the use of large scale survey research, using tools like questionnaire or interviews (structured). This type of research involves a large number of samples, hence is believed to be highly reliable. However, this research method has been blamed to have less contact with the participants, hence less engagements, and hence shallow data, in comparison to qualitative method which is believed to draw deeper inferences.

4.4 Research tools

Case study shall be done in a TESCO store to understand the performance management process in that particular organization. Semi structured Interviews along with questionnaires shall be the research tools, those of which will provide both qualitative and quantitative data. Secondary data shall also be collected via mediums like internet. Making an enquiry to learn a lesson from the expertise that practices it requires a closer integration with subject of analysis for some amount of time. Under such conditions, survey research is believed to more effective in comparison to other qualitative research methods (See Holloway, 1997).

4.5 Definition of Case study

Meriam (1998) defines case study as an entity which is studied as a single unit and has clear boundaries; it is an investigation of a system, an event, a process or a programme. However the definition of case study has changed with time and disciplines of studies. It is used in varieties of qualitative and quantitative research; however in this research it describes the qualitative study. Case studies differ from other qualitative approaches because of its three distinct characteristics; specificity, boundedness and multiplicity (Holloway, Ibid, Yin Opt cited). Yin argues that an empirical inquiry is preferred when the subject is to be studied is a contemporary phenomenon with a real life situation, when boundaries between phenomenon and content are not clearly evident, and in which multiple source of evidence is used.

4.6 Why survey within a case study approach?

Like in other qualitative research, a case study can just function as exploring the phenomenon in a specific context. A single case study may not always be generalizable; it is just a step towards generalization. It is wise to use number of steps towards generalization. It has been seen that researchers use number of sources in their data collection for example observation, documents and interviews etc, so that the study can be brighter and can gain a maximum validity. Observation and documentary research are the most common strategies that are used in case study research (Holloway, op.cit). However, when the purpose of the study is to understand the context of a contemporary phenomenon and extract lessons, a case study research approach can be an invaluable exploratory device (Gill and Johnson, 1997). According to Preece (1994), and Sharp & Howard (1996), a case study is a complex research activity, which may combine a number of general research instruments, such as interviews, observations, discussions, questionnaires, focus groups etc.

4.7 Maintenance of validity and Reliability

"Reliability and validity are tools of an essentially positivist epistemology." (Watling, as cited in Winter, 200, p. 7).

Joppe (2000) defines reliability as:

…The extent to which results are consistent over time and an accurate representation of the total population under study is referred to as reliability and if the results of a study can be reproduced under a similar methodology, then the research instrument is considered to be reliable. (p. 1)

Joppe (2000) provides the following explanation of what validity is in quantitative research:

Validity determines whether the research truly measures that which it was intended to measure or how truthful the research results are. In other words, does the research instrument allow you to hit "the bull's eye" of your research object? Researchers generally determine validity by asking a series of questions, and will often look for the answers in the research of others. (p. 1)

The qualitative data is always in a risk of lacking validity and reliability because of its relatively smaller sample size. Hence a proper consideration should be given about how to maintain validity and reliability of a research. An invalid or unreliable research study is not of any real importance. If the validity or trustworthiness can be maximized or tested then more "credible and defensible result" (Johnson, 1997, p. 283) may lead to generalizability which is one of the concepts suggested by Stenbacka (2001) as the structure for both doing and documenting high quality qualitative research. Hence the quality of a research depends on generalizability and thereby trustfulness and validity of the research. Maxwell (1992) on the other hand believes that the degree to which an account is generalizable is a key factor of distinguishing qualitative and quantitative research approaches. Hence, in this sense validity in qualitative method is very specific to a test to which it is applied in qualitative research, which is Triangulation.

4.7.1 Triangulation

Triangulation is typically a strategy (test) for improving the validity and reliability of research or evaluation of findings. Mathison (1988) elaborates this by saying:

Triangulation has risen an important methodological issue in naturalistic and qualitative approaches to evaluation [in order to] control bias and establishing valid propositions because traditional scientific techniques are incompatible with this alternate epistemology. (p. 13)

Patton (2000) argues that "triangulation strengthens a study by combining methods. This can mean using several kinds of methods or data, including using both quantitative and qualitative approaches" (p. 247). However there are some serious attacks on triangulation (See Barbour, 1998). She argues while mixing paradigms can be possible but mixing methods within one paradigm, such as qualitative research, is problematic since each method within the qualitative paradigm has its own assumption in "terms of theoretical frameworks we bring to bear on our research" (p. 353).

One of the paradigm of social research is constructivism, which views knowledge as a social process and may change within the change in circumstances. Crotty (1998) has defined constructivism from social perspective that "the view that all knowledge, and therefore all meaningful reality as such, is contingent upon human practices, being constructed in and out of interaction between human beings and their world, and developed and transmitted within an essentially social context" (p. 42). In any qualitative research, the aim is to "engage in research that probes for deeper understanding rather than examining surface features" (Johnson, 1995, p. 4) and constructivism may facilitate toward that aim. The constructivist notion, that reality is changing whether the observer wishes it or not (Hipps, 1993), is an indication of multiple or possibly diverse constructions of reality. Constructivism values the multiple realities that people have inside their mind. Hence different kinds of methods should be used to uncover those realities and validating the research process in such a constructive environment is highly important.