Influence of performance appraisal system on employee productivity in public sector: a case of ministry of agriculture Ruiru Kenya

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1 Volume: 2, Issue: 5, May e-issn: p-issn: Impact Factor: Yusuf Wanjala Musi Master of Business Administration of School of Business and Economics of Jaramogi Oginga Odinga University of Science and Technology Influence of performance appraisal system on employee productivity in public sector: a case of ministry of agriculture Ruiru Kenya Yusuf Wanjala Musi Abstract The public sector in Kenya is going through profound restructuring in the face of financial constraints that force the sector to encourage employees to appreciate appraisal systems for enhancement of productivity. In this respect, one of the most popular tools used in the contemporary productivity enhancement programme is the application of performance appraisal systems. However, since appraising is considered to be a particularly controversial management practice anywhere it is being practiced, its influence in the public sector faces numerous challenges and obstacles. The purpose of this study was to explore the influence of performance appraisal system on employee. The study was guided by the specific objective namely; - to determine the influence of training, to establish the influence of promotion, to examine the influence of remuneration and to find out the influence of discipline on employee productivity. The study hoped that it would provide valuable information to management that would assist management in ensuring that performance is more than ability and motivation. The theories included; goal setting theory, learning and training and evaluation theory, agency theory and expectance theory respectfully. Content analysis was used to calculate qualitative data while descriptive analysis was used to calculate mean, frequencies and percentage. A case study was adopted due to the nature of the study and because it would enable an in-depth analysis of the study phenomenon. The target population was 90 and a saturadete sampling method was adopted. Questionnaires were used to collect data and was analyzed and presented through tables and charts. The researcher used both qualitative and quantities techniques in analyzing the data. The researcher selected a pilot group of 10 individuals to test the reliability. Validity test was done on 5 participants. Cronbach s Alpha was calculated and come as for part II and III and for part IV and V. The findings from the study established that majority of employees felt that the performance appraisal system was not the best tool in measuring performance. It also established that training, promotion; discipline and remuneration had an influence on staff performance and hence enhanced their productivity. It is essential therefore to train and develop people for effective performance. Promotion influences the perception of the employees about fairness in the organization, while remuneration that is not visible to the employee may fail to get desired motivating effect. Organization still need to have displinary procedure, whether formal or informal, that carries successively stiffer penalties for repeated or for most serious offenses. Keywords: Gross Domestic Product, United Nations Development Program, Organization for Economic Cooperation and Development, Salaries and Remuneration Communication Correspondence: Yusuf Wanjala Musi Master of Business Administration of School of Business and Economics of Jaramogi Oginga Odinga University of Science and Technology Introduction One of the most popular tools used in the contemporary productivity enhancement programme is the application of performance appraisal systems. However, since appraising is considered to be a particularly controversial management practice anywhere it is being practiced, its influence in the public sector faces numerous challenges and obstacles. Performance appraisal system is a critical component of the overall human resource management function in the public sector. The use of performance appraisal systems is generally motivated by the desire to influence employee behaviors, attitudes and subsequently productivity. The quest for methods to motivate employees and thereby improve efficiency in the public sector has for a long time been influenced by persisting fiscal constraints, declining employee productivity and disenchantment with the delivery of public services. Hence this study sought to establish the influence of performance appraisal system on employee productivity in public sector in Ministry of Agriculture in Ruiru District, Kenya. Objectives of the Study The purpose of the study was to assess the influence of performance appraisal system on employee productivity in public sector in Kenya. The study was also guided by the following specific Objectives; ~ 235 ~

2 i. To determine the influence of training on employee ii. To establish the influence of promotion on employee iii. To examine the influence of remuneration on employee iv. To find out the influence of discipline on employee Significance of the Study The study is hoped would provide valuable information to the management that would assist in ensuring that performance appraisal system is appropriately administered and appreciated. The management would also be able to formulate policies that help enhance employee productivity in the organization. The findings and recommendation of the study would enable the formulation of effective performance appraisal strategies for enhancing employee productivity without much resentment. The study would shed more light on the issues of performance appraisal that enhance employee productivity in the public sector. It would also enable the researcher to identify the gaps that still need to be addressed. The study would also provide added literature for knowledge advancement and scholarly discourse. was on a group of people working in the organization. Each group selected though distinct was likely to be intricately connected on wide ranging issues influencing the study phenomena. The researcher investigated the subject of the case study in depth using a questionnaire data gathering method to produce evidence that lead to understanding of the case and hence provide answers to the research questions. Cooper & Schindler, (2005) Define descriptive research as a formal, objective, systematic process to describe the relationship that exists among variables. A descriptive design was selected because it provided an accurate portrayal or account of the characteristics, behavior, opinions, abilities, beliefs, and knowledge of a particular individual, situation, or group. This design was chosen to meet the objectives of the study. Conceptual Framework Statement of the Problem Performance appraisal system is a critical component of the overall human resource management function in the public sector. The use of performance appraisal systems is generally motivated by the desire to influence employee behaviors, attitudes and subsequently productivity. The quest for methods to motivate employees and thereby improve efficiency in the public sector has for a long time been influenced by persisting fiscal constraints, declining employee productivity and disenchantment with the delivery of public services. Salaries and Remuneration Commission SRC, (2014) report show that the current declining productivity levels experienced in the public sector is as a result of low executive commitment to performance appraisal systems, absence of rigor, objectivity and continuity in the administration of the system, non-linkage of the process to an enforceable reward and sanctions mechanism, non-linkage of the system to staff development, and lack of effective monitoring, annual reporting and feedback mechanisms. The end result of this failure has been the inability of the public service to measure and evaluate the performance of their work. Hence this study sought to establish the influence of performance appraisal system on employee productivity in public sector in Ministry of Agriculture in Ruiru District, Kenya. Research Design The research applied a case study design because it enabled an in depth study of a particular situation it also narrowed down the research into one unit of observation. Kothari, (2004) defines the case study research method as an empirical inquiry that investigates a contemporary phenomenon within its reallife context, when the boundaries between phenomenon and context are not evident, and in which multiple sources of evidence are used. The researcher established the Ministry of Agriculture in Ruiru District to refer to over the course of study. Questions were formed about the situation or problem to be studied and the purpose determined. The research object in this case study ~ 236 ~ Fig 1: Conceptual Framework Target Population Target population as defined by Kothari, (2004) is a universal set of the study of all members of real or hypothetical set of people, events, or objects to which an investigator wishes to generalize the result. The target population was 90 and included all the staff of the Ministry of Agriculture in Ruiru District as indicated in table 1 below:. Table 1: Target Population Category No. of employees Percentage Management 5 3 Supervisors Support Staff Total Sampling Procedure and Sample Size A Census inquiry was used where the entire subjects were considered for the study. Zikmund, (2003) defines a census as a complete enumeration of all items in the population. It can be presumed that in such an inquiry, when all items are covered, no element of chance is left and highest accuracy is obtained. The entire staff of 90 subjects was therefore included in the study. Data Collection Method A questionnaire was used as data collection instrument. A questionnaire is a printed self-report form designed to elicit information that can be obtained through the written responses of the subjects (Kothari, 2004). Questionnaire was decided upon because it ensured a high response rate as the questionnaires are distributed to respondents to complete and is collected personally by the researcher. They required less

3 time and energy to administer. They offered the possibility of anonymity because subjects names were not required on the completed questionnaire. Open-ended questions were included to enable the subjects to respond to questions in their own words and provide more detail. Closed-ended questions were included because they were easier to administer and to analyze. They are also more efficient in the sense that a respondent is able to complete more closed-ended items than open-ended items in a given period. Pilot Study The researcher carried out a pilot study to pre-test and validate the questionnaire. To establish the validity of the research instrument the researcher sought the opinion of the supervisor. This was to facilitate the necessary revision and modification of the research instrument thereby enhancing validity. The researcher selected a pilot group of 10 individuals to test the reliability of the research instrument. To test the validity of the instrument, a study was done on five participants. Based on their responses, validity tests were done to check for the validity and usability of the instrument. Cronbach s Alpha, was calculated to measure the internal consistency reliability of the instrument. If the value of Cronbach s Alpha is greater than 0.7 then the instrument is considered reliable. The value of Cronbach s Alpha came as for Part II and III and for Part IV and V; thus, the instrument was considered reliable for the study (Kothari, 2004). Data Analysis Methods For data collected to be meaningful, it needed to be analyzed in a way that it was easily understood by the common person. This included an analysis of data to summarize the essential features and relationships of data in order to generalize and determine patterns of behavior and particular outcomes. Before processing the responses, the completed questionnaires were edited for completeness and consistency. The researcher used both qualitative and quantitative techniques in analyzing the data. Content analysis was used to analyze the qualitative data while descriptive analysis such as mean, frequencies, and percentages was used to analyze the data. The organized data was interpreted because of concurrence to objectives using assistance of computer packages especially statistical package for social scientists (SPSS) version 21 to communicate research findings. Tables and charts were used for data presentation. After the analysis and interpretation of data, a final report was written to provide a summary of the findings. Presentation of Findings Questionnaire Return Rate The response rate determination was important because it clearly enabled the researcher to know the exact number of questionnaires that would be valid for analysis as indicated in table 2. Table 2: Questionnaire Return Rate Response Non Response 3 3 Total Table 2 indicates how the sampled respondents participated in the study. The total numbers of the respondents who successfully filled and completed the questionnaires to the required satisfaction of the research were 87, which comprised 97% while three comprising 3% of the respondents did not participate effectively. This was in tandem with Bryman et al, (2007) that a response rate above 50% of the total sample size contributes towards gathering of sufficient data that could be generalized to represent the opinions of respondents in the target population on the study problem. The study therefore relied on the data obtained from 87 respondents to determine the influence of performance appraisal system on employee productivity in the organization. Gender of the Respondents The issue of gender was important for the study as it would indicate whether there was gender balance in the responses given, the findings were as follows: Table 3: Gender of the Respondents Male Female According to table 3 the total number of males who responded was 56(64%) while females were 31(36%). From the study it can be concluded that the number of males who responded were higher than the number of females. Although there was gender disparity in the organization, the study found out that the female staffs were more productive than their male colleagues working in similar positions. This was because the female staffs were meticulously prepared for their routine tasks. Distribution of Respondents by Age Determination of the age of the respondents would add much value to the study in that it would reveal whether productivity increased or declined with age. The analysis of the age of respondents was as follows; Table 4: Age Bracket Above According to table 4, 11(13%) of the respondents were of the age bracket 18-25, 45(52%) were between the ages of while 22(25%) were between the ages of 36-45, 6(7%) were of the age bracket while 3(3%) were of the ages of above 55 years. Based on the study it can be inferred that majority of the respondents were between the age of This therefore indicated that majority of the employees were young and should be productive. However, this was not the case; the findings revealed that the most productive staff was those of age bracket between years. The study attributed this level of productivity partly due to experience and frequent training. Distribution of Respondents by Highest level of Education The analysis of the education level of respondents in this organization was relevant because it would show how well they appreciate performance appraisal systems and what it means for the organization. The findings were as follows: ~ 237 ~

4 Table 5: Highest Level of Education Secondary 3 3 College University Totals Table 5 shows the level of education of various respondents. According to the table, 57(66%) of the respondents were university graduates while 3(3%) were of secondary level and 27(31%) were of college level. From the study, it can be deduced that the majority of the respondents were of university level. This implies that the majority had university level of education. The study found that staff productivity did not depend on the highest level of education, however, it was noted that staff from agricultural institutions were more productive. This was evident from those in the field. Marital Status The analysis of the marital status was important, as it would reveal whether their status had some positive or negative influence on their productivity. The findings were as follows; Table 6: Marital Status Divorced 7 8 Separated 4 5 Married Single Table 8 shows the influence of training on employee productivity. Based on the analysis, 67(77%) of the total respondents indicated that training had an influence on employee productivity, 20(33%) of the total respondents stated that training did not influence employee productivity. From the study it can be concluded that training had an influence on employee productivity. Promotion Rating On how they rated the benefit of promotion after appraisal the respondents indicated the following; Table 9: Promotion Rating Excellent Good Fair Poor 9 10 Table 9 indicates how they rated Promotion. Majority of the respondents comprising 48(55%) rated Promotion as good, 18(21%) rated it as excellent, 12(14%) rated it as fair while 9(10%) of respondents rated Promotion as poor. From the analysis it can be concluded that majority rated Promotion good. Influence of Promotion employee productivity On whether Promotion had an influence on employee productivity, the respondents indicated the following: Table 6 indicates the analysis of marital status. Based on the findings, 23(26%) of the respondents were single, 53(61%) of the respondents were married, and 4(5%) were separated while 7(8%) were divorced. This implies that the married respondents were the majority in the organization. Since majority of these employees are married, they most likely rely on the job to maintain their families and hence the need to be committed and productive. Training Rating Based on how they rated the benefits of training after appraisal, the respondents indicated the following; Table 7: Training Rating Excellent Good Fair poor 5 6 Table 7 shows how respondents rated training on employee productivity. The study findings indicate that 12(14%) of respondents rated it excellent, 29(33%) rated it good while 41(47%) rated it fair, 5(6%) of respondents rated it poor. This indicates that the majority of respondents rated training fair. Influence of training on employee productivity. Whether training had an influence on employee productivity, the response was as follows: Table 8: Influence of training Yes No ~ 238 ~ Table 10: Influence of Promotion Yes No Table 10 shows the influence of Promotion on employee productivity. Based on the analysis 71(82%) of the total respondents, indicated that Promotion had an influence on employee productivity while 16(18%) of the total respondents stated that Promotion did not have an influence on employee productivity. From the study it can be concluded that Promotion had an influence on employee productivity. Remuneration Rating On how they rated the benefit of remuneration after appraisal the respondents indicated the following; Table 11: Remuneration Rating Excellent Good Fair Poor 9 10 Table 11 indicates how they rated remuneration. Based on the analysis 15(17%) of the total respondents rated remuneration excellent, 20(23%) of the total respondents rated it good, 43(50%) of the respondents rated it fair while 9(10%) of the respondents rated remuneration poor. From the analysis it can be concluded that majority of the respondents rated remuneration fair.

5 Influence of remuneration on employee productivity On whether remuneration had an influence on employee productivity, the respondents indicated the following: Table 12: Influence of Remuneration Yes No Table 4.11 shows the analysis of the influence of remuneration on employee productivity. Based on the analysis, 65(75%) of the total respondents indicated that remuneration had an influence on employee productivity, 22(25%) stated that remuneration had no influence on employee productivity. From the study, it can be concluded that remuneration had an influence on employee productivity. Discipline Rating On how they rated the benefit of discipline after appraisal, the respondents indicated the following; Table 13: Discipline Rating Excellent 2 2 Good Fair Poor 7 8 Table 13 above indicates how they rated discipline. Based on the analysis, 54(62%) of the total respondents rated discipline as good, 24(28%) of the total respondents rated it as fair, 7(8%) of the respondents rated it as poor, while 2(2%) of the respondents rated it excellent. From the analysis, it can be concluded that majority of the respondents rated discipline as good. Influence of discipline on employee productivity On whether discipline had an influence on employee productivity the respondents indicated the following: Table 14: Influence of Discipline Category Respondents Percentage Yes No Table 14 shows the influence of discipline on employee productivity. Based on the analysis, 64(74%) of the total respondents indicated that discipline had an influence on employee productivity, While 23(26%) of the total respondents stated that discipline does not have an influence on employee productivity. From the study it can be concluded that discipline had an influence on employee productivity. Discussion of the Study The purpose of this study was to assess the influence of performance appraisal system on employee productivity in public sector. Based on the findings employee productivity was found to be influenced by four variables including; training, promotion, remuneration, and discipline. A total of 87 employees from the Ministry of Agriculture Ruiru participated in the study effectively by completing the study's questionnaire. ~ 239 ~ The results of the study indicate that, effective training was essential for employees whose performance do not meet productivity threshold. Employees in the organization indicated that it was very important to have frequent in house on the job training programs for skill improvement, which in turn can enhance their productivity. Moreover, employees in this study were very satisfied with their current performance appraisals systems because it identified their training needs and therefore appreciated the system as a useful tool for determining their performance. This finding gives credence to the assertion of related studies by Arthur, et. al., (2003) that also shows that higher levels of training result in more positive outcome on employee productivity. The findings show that employees would prefer promotion but with a well defined role. Employees indicated that performance appraisal results should be used fairly to promote only those whose productivity is higher. These findings give credence to the study by Gibbons, (2006) that promoted individuals assigned new roles better suiting their abilities were highly motivated to work harder and be productive. The results show that higher remuneration packages lead to higher employee productivity, and that employees were motivated by better remuneration schemes. These findings are in line with earlier reviewed studies by Corby, (2005) that better remuneration schemes have beneficial effect on individual motivation and productivity in the workplace. Employees also indicated that they preferred a code of conduct with the disciplinary measures of that represent an accurate picture of all disciplinary actions. The participants felt that there was need for participatory approach discipline. These results are consistent with the views of Imundo, (2006) who asserts that an organization which actively solicits and utilizes employee ideas in its disciplinary code is more likely to engender employee acceptance and therefore enhance their productivity. Summary of findings Influence of training on employee productivity Based on the analysis of 87 respondents, 77% of the total respondents indicated that training had an influence on employee productivity, 33% of the total respondents stated that training did not influence employee productivity. From the study it can be concluded that training had an influence on employee productivity. Influence of Promotion on employee productivity Based on the analysis of 87 respondents, 82% of the total respondents indicated that Promotion had an influence on employee productivity while 18% of the total respondents stated that Promotion did not have an influence on employee productivity. From the study it can be concluded that Promotion had an influence on employee productivity. Influence of remuneration on employee productivity Based on the analysis of 87 respondents, 75% of the total respondents indicated that remuneration had an influence on employee productivity, 25% stated that remuneration had no influence on employee productivity. From the study it can be concluded that remuneration had an influence on employee productivity. Influence of discipline on employee productivity Based on the analysis of 87 respondents, 74% of the total respondents indicated that discipline had no effect on

6 employee productivity, while 26% of the total respondents stated that discipline did not have an effect on employee productivity. From the study it can be concluded that discipline had an effect on employee productivity. Recommendation Based on the study findings: It is recommended that the employees of the Ministry of Agriculture in Ruiru district who lack job related skills be trained to enhance their productivity. It is recommended that employees of the Ministry of Agriculture in Ruiru district whose performance rating is exceptional be promoted to maintain their productivity. It is recommended that employees of the Ministry of Agriculture in Ruiru district receive fair remuneration to increase their productivity. It is recommended that employees of the Ministry of Agriculture in Ruiru district who perform below the stipulated standard be disciplined to improve their productivity. Conclusion The study was designed to assess the influence of performance appraisal on employee productivity in public sector. The variables investigated were training, promotion, remuneration and discipline. Performance appraisal in the public sector was introduced with the purpose of increasing staff productivity. The government thought that the system would rid off the public sector none performing individual and hence enhance productivity. Training was found to be an important factor in the enhancement of employee productivity. Adequately trained staffs were found to be able to comprehend the task performed in the organization. Promotion was seen to be an influencing factor of performance appraisal and therefore enhanced employee productivity. However, the staffs were found to be rather concerned about its fairness. 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