Using Performance Appraisal Systems In Motivation Business Essay

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A performance appraisal is the process of assessing workers performance in comparison to certain predetermined organizational standards. Appraisals not only help employees understand how they are doing but they also help the worker's supervisor along with the organization as a whole.

Performance appraisal is one way of giving employees feedback about their performance at work. According to ACAS (1997) appraisals regularly record an assessment of an employee s performance, potential and development needs.

Performance appraisal is a formal system of measuring, evaluating, and influencing an employee s job-related attributes, behaviours and outcomes.

In some organisation s appraisal results may be used to determine relative rewards in the firm -- who should get merit pay increases, bonuses, or promotions. Similarly, appraisal results can be used to identify the poorer performers who may require some form of counselling, demotion, dismissal or decreases in pay.

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 many theorists including Elton Mayo Frederick Taylor, who have recognized the power of recognition as an incentive (Maslow and the Expectancy Theory of Motivation).

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.

There have been many theories on the aspect of motivation. Many contemporary authors have defined the concept of motivation. Krietner (1995) defined motivation as a psychological process that gives behaviour purpose and direction.

Motivation is seen as a very important aspect of an organisation as it contributes to how well it performs. This ultimately has an effect on the organisations corporate objectives. This includes attainment of higher market share and profit maximisation as a result of an individual s performance. Processes that are used to motivate employees have an effect on their willingness to stay with the organisation. Appraisals are prevalent in many companies and are seen as a crucial ingredient in motivating employees; therefore it increases the importance of carrying out this study.

The purpose of this study is to examine the statement To what extent do performance appraisals motivate individuals in the workplace . The findings will be attained from the prominent theories in motivation. The study will try to find which of the theories from Mayo, Hertzberg and Taylor are evident from the findings.

The reason that research is being conducted is because motivation and the fact that it is a broad subject and can be interpreted into many different functions. Also it plays a pivotal role within different departments of organisations and it is attributed to the success of an organisation.

Literature review

Theories of motivation

In general, motivation theorists focus their work on the "whys" of human behaviour (Weiner, 1992). Cognitive theorists of motivation propose a clear relation between beliefs, attitudes, and values as mediators of task engagement (Eccles, Wigfield, & Schiefele, in press). That is, the extent to which one engages in a task depends upon beliefs about one's own competence or self-efficacy, the extent to which one values a given task, and whether that value is intrinsic or extrinsic in origin (Deci & Ryan, 1985). Motivation researchers see these individual beliefs, values, and goals for achievement as critical determinants of achievement-related behavior (Weiner, 1992; Wigfield & Eccles, 1992). These constructs can be conceptualised as a series of questions an individual asks themselves with respect to a given activity or task (Wigfield, 1997), including

? Can I succeed?

? Do I want to succeed and why? and

? What do I need to do to succeed?

Researchers in this area have developed a number of motivational constructs to describe how they relate to various achievement behaviors. These include perceptions of ability and self-efficacy, task values, achievement goals, control beliefs, intrinsic and extrinsic motivation, and achievement attributions (Rigby, Deci, Patrick, & Ryan, 1992; Wigfield & Eccles, 1992).

Many theorists on practical aspects of motivation in the workplace have conducted motivational research. Research that has been undertaken in this field notably by Douglas McGregor [theory y], Frederick Herzberg [two factor motivation hygiene theory,] Abraham Maslow [theory z, hierarchy of needs] Elton Mayo [Hawthorne Experiments] Chris Argyris Rensis Likert and David McCelland [achievement motivation] But within this Literature review the prominence and analysis will be concentrated solely on the three theorists:-

- Elton Mayo (Hawthorne Experiments)

- Douglas McGregor (theory Y)

- Abraham Maslow ( hierarchy of needs)

- Frederick Herzberg (two factor motivation hygiene theory)

The most important issue that will be evaluated while analysing the affects of the above theorist and their views will be their significance to the overall selected research topic in addition to their individual failings in their theory s and research.

Introduction to Maslow s Hierarchy of Needs Maslow s Hierarchy Needs

Maslow's theory consisted of two parts:

? The classification of human needs, and

? Consideration of how the classes are related to each other

Maslow summarized the hierarchies of needs relevant to the chosen research topic as follows:

- A person starts at the bottom of the hierarchy (pyramid) and will initially seek to satisfy basic needs (e.g. food, shelter)

- Once these physiological needs have been satisfied, they are no longer a motivator. The individual moves up to the next level

- Esteem needs are about being given recognition for a job well done. They reflect the fact that many people seek the esteem and respect of others. A promotion at work might achieve this.

Problems with the Maslow s Model

The problem with the above study is although Maslow's model has great potential appeal in the business world. The message is barely clear if management can find out which level each employee has reached, then they can decide on suitable rewards so therefore only then can they increase motivation..

There are several problems with the Maslow model when a real-life working practice is considered:

- Individual behaviour seems to respond to several needs - not just one

- The same need (e.g. the need to interact socially at work) may cause quite different behaviour in different individuals

- There is a problem in deciding when a level has actually been "satisfied"

- The model ignores the often-observed behaviour of individuals who tolerate low-pay for the promise of future benefits

- There is little empirical evidence to support the model.

Therefore linking this to the research proposal question in Maslow s analysis appraisal will come below the fourth level of the hierarchy this can be criticized, as a number of people may believe without appraisal in a workplace they may not be with the organization for a long period of time.

Motivator Factors

Motivator factors are based on an individual's need for personal growth. When they exist, motivator factors actively create job satisfaction. If they are effective, then they can motivate an individual to achieve above-average performance and effort. Motivator factors include status, opportunity for advancement, gaining recognition, responsibility, challenging/stimulating work, sense of personal achievement & personal growth in a job.

There are several similarities between Herzberg's and Maslow's models. They both suggest that needs have to be satisfied for the employee to be motivated. However, Herzberg argues that only the higher levels of the Maslow Hierarchy (e.g. self-actualization, esteem needs) act as a motivator. The remaining needs can only cause dissatisfaction if not addressed.

Applying Hertzberg's (model to de-motivated workers. What might the evidence of de-motivated employees be in a business?

Low productivity, poor production or service quality, strikes / industrial disputes / breakdowns in employee communication and relationships, complaints about pay and working conditions and according to Herzberg, management should focus on rearranging work so that motivator factors can take effect. He suggested three ways in which this could be done job enlargement, job rotation job enrichment good quality training, Focus on quality of communications

McGregor s Theory X and Theory Y

McGregor developed two theories of human behaviour at work: Theory and X and Theory Y. He did not imply that workers would be one type or the other. Rather, he saw the two theories as two extremes - with a whole spectrum of possible behaviors in between.

Theory X workers could be described as follows:

- Individuals who dislike work and avoid it where possible

- Individuals who lack ambition, dislike responsibility and prefer to be led

- Individuals who desire security

The management implications for Theory X workers were that, to achieve organisational objectives, a business would need to impose a management system of coercion, control and punishment.

Theory Y workers were characterised by McGregor as:

The management implications for Theory X workers are that, to achieve organisational objectives, rewards of varying kinds are likely to be the most popular motivator. The challenge for management with Theory Y workers is to create a working environment (or culture) where workers can show and develop their creativity.

Literature review for Performance Appraisals

Armstrong (1994) defines performance Appraisals as "a process designed to improve organisational, team and individual performance". Quoting from Rogers (1995), Performance management is a joint process that involves both the supervisor and the employee, who identify common goals, which correlate to the higher goals of the institution. This process results in the establishment of written performance expectations later used as measures for feedback and performance evaluation.

Performance management is about harnessing the abilities and creativity of each employee. In order to get the most out of performance management, organizations need to put in place systems and methods which translate the goals of strategic management into individual performance terms. (Storey and Sisson, 1993).

Armstrong (1994) describes performance management as a continuous self-renewing cycle whose main activities are:

? Role definition

? Performance agreement or contract

? Personal development plan

? Managing performance throughout the year

? Performance review

Mabey, Salaman and Storey (1998) argue that performance agreement should cover the following points:

Objectives and standards of performance

Performance measures and indicators

Competency assessment

Core values or operational requirements

Kitay and Lasbury (1997) suggest that there has been a growth in pay for performance schemes, flexible employment practices, training, performance appraisals and broader job structures. These developments imply an emphasis on improving employee performance while at the same time increasing the flexibility of labour

Capelli and Crocker-Hefter (1996) argue that there is no single best practice in performance management to which all organizations should aspire. Moreover, the literature shows that each firm has a distinctive performance management system that represents a core competencies required for the survival and sustainability for that particular organization and does not put emphasis on one single aspect.

In short, there is no best performance management theories or practices. What was best for one company may not be best for another. What was best last month may not be best today. The concept of best is highly subjective and non-specific.

Aims and objectives

The following are the aims and objectives that will be examined during the research:

- Do performance appraisals motivate in the workplace?

- To what extent do performance appraisals motivate the workforce?

- Which other factors other than performance appraisals affect motivation of the workforce?

The answers to the above questions will determine whether or not the statement performance appraisals motivates in the workplace is true and if it is, to what extent and conditions does it apply. The main aim is to carry out research to conclude if performance appraisals are the only factor driving towards motivation. Therefore it has been emphasised that obtaining the highest possible wages through working in the efficient and productive way would motivate workers . This will also lead to establish the relationship between performance appraisals and motivation looking at the sheer scale of the strength of this relationship.

The second aim will then move on to find out to what extent performance appraisals motivates at the different hierarchical levels of the organisation. It will then illustrate whether there are alternative factors that drive motivation or if it is a combination of the two.

The final aim set out for this proposal is to investigate the alternative factors that motivate. This is because even the most performance appraisals-orientated theorists such as Fredwick Taylor have addressed that there are other factors that motivate, even though they may disagree with the extent to which each affects motivation. Therefore, by addressing these other factors, critical understanding can be attained through justifying the alterative factors by investigating why and how they motivate.

Research Question

To what extent do performance appraisals motivate individuals in the workplace?

The variables below will be measured throughout the research

Independent variable Intervening variable Dependent variable

Moderating variable


Population and sample

The proposed research will be conducted on a market research company called National Opinion Poll (N.O.P), which is based in Luton. This company was chosen as performance appraisals are very prevailing in this business and are undertaken a number of times each year.

In this study the effects of appraisals within the organisation N.O.P will be investigated. The most important factor that will be looked into while analysing the affects of appraisals will be if they have a considerable impact on motivation with regards to the employees within N.O.P. Furthermore, the views of employees of N.O.P will be given as to what their views and feelings are on performance appraisals.

Population and sample

I have chosen the complete workforce of my organisation as the population, which consists of 750 employees together with, management, supervisors, and team leaders across three different shift-patterns (9am-1pm, 1pm-5pm, 5pm-9pm). A record of all employees on different shift patterns will be attained from the human resource branch by request.

The recommended sample size is 254 with a 95 percent level of certainty. This leaves a margin of error of 5 percent. A reasonable response rate for interviews (kervin, 1992) theses responses rates will be taken into consideration when carrying out the research.

The sampling techniques that will be as a rule suitable in this organisation are systematic and stratified random sampling. The workforce will be divided into two separate strata. One stratum being management consisting of managers, supervisors and team leaders, the other stratum consisting of the telesales staff.

After carrying out the calculation it was found that 1 in every 3 cases needs to be selected from the sampling frame to represent the telesales staff.

The sampling fraction formula that was used to attain the fraction for telesales staff sample selection is 322/750=1/3

Research question

To answer the research question and meet the objectives a multi-method approach will be taken.

The first method that will be used to collect data is through the use of semi-structured interviews. The interviews will be conducted on a one-to-one basis and voice recorded. Consequently the data will be used to understand the relationships between the variables. Interviews will be conducted with the staff in various departments to fully understand their experiences and views on performance appraisals as a motivator; however, interview method will take more time in gathering information. Furthermore, some information gathered from interviews might be bias. But the interview method was chosen because it allows flexibility to get full range and in-depth information from the participants. Response rate very high use of panel is easy

The interviews will be carried out randomly on a few people from each department. This may give an overview on the extent to which appraisals motivate and will exemplify the relationship between appraisals and motivation whilst moving along the hierarchy.

The second method that will be used will be in the form of questionnaires, which will be handed out, this method was chosen as questionnaires are a less expensive way to reach more people, data analysis can begin right away..

Thoughts on questionnaires

Potential Advantages on questionnaires

Easy to administer

Can cover a variety of topics in a brief amount of time

Helps to establish relationship with participants

Easier to communicate results

Potential Disadvantages

Information (perception and opinion) considered to be indirect data

Good surveys and questionnaires are difficult to develop

Voluntary participation may result in biased results

Forced-response choices may not allow individuals to respond as they wish

I can over come the disadvantages of this method by; -

Pilot all instruments

Non-appropriate methods

Mail surveys this method was considered to eliminates interviewer bias but the disadvantages involved with method was that no one would be available to prod respondent to answer questions, no on would be available to answer respondent questions and also mail surveys would take longer to get back in addition to blank responses are more frequent so this method was not preferred.

Data analysis and presentation

Microsoft data analysis software i.e. Excel will be used to analyse data. Graphs are one way to visualize data and will be used as they help when looking for patterns. Data will be constructed into graphs. This will sufficiently analyse the descriptive information. It will also allow the research aims and objectives to be examined and allow the hypothesis To what extent do performance appraisals motivate individuals in the workplace to be established.

From the analysed results, the findings of the value of performance appraisals or the impact of the appraisals on motivation inside NOP can be acknowledged. This information can then be used to make recommendations for improvement to the company.

Month Task Carried Out

Section 2 Attain permission from NOP head office to conduct research

Section 3 Setting up

Section 4 Monitor conditions

Section 5 Start observations

Section 6 to 9 Evaluate and study results put together recommendations

Section 10 Report Writing

Gantt Chart Showing Project Time Management

Month May Jun Jul Aug Sep

Week 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3 4 1 2 3

Research Task

Section 2

Section 3

Section 4

Section 5

Section 6

Section 7

Section 8

Section 9

Report writing

Section 11



Presenting the study

Gantt chart showing project time management

Project Budget

The research will be self-funded.

Amount Task

20 Constructing questionnaire e.g. printing costs

10 Material e.g. stationary, paper etc

5 Travel costs


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? Latest Surveys offer Insigths into how to motivate and retain your top performers.