A NEW STRATEGY FOR OPTIMIZING MICRO FINANCE BANK PRODUCTIVITY: A STUDY OF AKWA SAVINGS AND LOANS LIMITED AND PILLARS MICRO-FINANCE LIMITED, UYO, AKWA IBOM STATE, NIGERIA

ABSTRACT (A NEW STRATEGY FOR OPTIMIZING MICRO FINANCE BANK PRODUCTIVITY)

Performance Management processes have become prominent in recent years as means of providing a more integrated and continuous approach to the management of performance that was provided by previous isolated and often inadequate merit rating or performance appraisal schemes. Performance management is based on the principle of management by agreement or contract, rather than management by command. It emphasizes development and the initiation of self-managed learning plans as well as the integration of individual and corporate objectives. It can, in fact, play a major role in providing for an integrated and coherent range of human resource management processes which are mutually supportive and contribute as a whole to improving organizational effectiveness. Performance management is not a top-down, backward-looking form of appraising people, nor a method of generating information for pay decisions. It is forward-looking and developmental. It provides a framework in which managers can support their team members rather than dictate to them, and its impact on results will be much more significant if it is regarded as a transformational rather than as an appraisal process. In this dissertation, the survey research design was employed by the researcher to gather data for the study and the questionnaire was used as the instrument for data collection. Data were analyzed using tables and percentages. The chi-square statistical tool was used in the testing of the research hypothesis raised in chapter one of the study. The research findings revealed that there is a strong relationship between effective performance management and overall improvement in organizational effectiveness, performance and productivity; that effective performance management helps to clarify corporate goals to both the managers and employees; that performance management encourages open and honest communication between manager and subordinates in an organization and that performance management has truly become the new strategy for optimizing organizational productivity. Hence, the researcher recommends that for performance management to maintain this high status, that performance management should be monitored and evaluated regularly, especially after its first year of operation. That feedback should be encouraged amongst all stakeholders; and that more detailed assessment and evaluation amongst managers and employees on the impact of the process be done to reveal specific areas in which performance has improved and could be linked to an overall performance measure.

CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND OF THE STUDY

The concept of performance management has been one of the most important and positive developments in the sphere of human resource management in recent years. The phrase was first coned by Beer and Ruh in 1976 but it did not become recognized as a distinctive approach until the mid 1980s, growing out of .the realization that a more continuous and integrated approach was needed to manage and reward performance.

All too often, crudely developed and hastily implemented performance related pay and appraisal systems were not delivering the results that, somewhat naively, people were expecting from them.

Performance management has risen like a phoenix from the old-established but somewhat discredited systems of merit rating and management by objectives. Many of the more recent developments in performance appraisal have also been absorbed into the concept of performance management, which aims to be a much wider, more comprehensive and more natural process of management. Performance appraisal has too often operated as a top-down and largely discredited bureaucratic system owned by the personnel department rather than by line managers.

1.2   STATEMENT OF THE PROBLEM

Performance management is based on the principles of management by agreement or contract rather than management by command. It emphasizes development and the initiation of self-managed learning plans as well as the integration of individual and corporate objectives.

Consequently, the problem of this study is on “Performance Management”, as a new strategy for improving organizational effectiveness.

The dimension of this problem is based on the following factors that:

(i)    Measures should relate to results, not efforts.

(ii)    The results must be within the job holder’s control.

(iii)   Measures should be objective and observable.

(iv)   Data must be available for objective measurement.

It is based on the above problems that this study was conducted, in order to use performance management to optimize micro-finance sector’s effectiveness and productivity.

1.3   PURPOSE (OBJECTIVE) OF THE STUDY

        The objective of this thesis was to study and analyze the role of performance management as a new strategy for optimizing organizational effectiveness and productivity in Akwa Savings and Loans Limited, and Pillars Micro-finances Limited, Uyo, Akwa Ibom State.

The objectives were clearly spelt out as follows:

(a)   To analyze the role of performance management as a means of getting better results from the organization, teams and individuals.

(b)   To discuss the application of performance management by understanding and managing performance within an agreed framework of planned goals, standards and competence requirements.

(c)    To apply performance management as a process for establishing shared understanding about what is to be achieved.

(d) To discuss performance management as an approach to managing and developing people in a way that increases the probability that enhanced effectiveness of the organization would be .achieved in the short and longer term.

1.4   RESEARCH QUESTIONS

As a guide to this thesis, the following research questions were formulated:

(i)    Is there any relationship between effective performance management and overall improvement in organizational effectiveness?

(ii)    Could effective application of performance management help to clarify corporate goats?

(iii)   Could performance management encourage self-management of individual performance?

(iv)   Could performance management encourage open and honest two-way communication between managers and subordinates?

(v)   Is performance management a better strategy for measuring and assessing all performance against jointly agreed goals?

1.5   STATEMENT OF THE HYPOTHESES

A hypothesis is seen as a searchlight in every research endeavour. It gives the directives of investigation and guides the researcher in the selection of appropriate research tools. In this thesis, the following hypotheses were formulated:

(1) H0: There is no significant relationship between         performance management strategy and the improvement   of organizational effectiveness.

Hi: There is a significant relationship between performance management strategy and the improvement of organizational effectiveness.

(2)   H0: Performance Management has no direct holistic impact on organizational effectiveness.

Hi: Performance Management has a direct holistic impact on organizational effectiveness.

1.6   SIGNIFICANCE OF THE STUDY

        The significance of this study on performance management as a new strategy for optimizing micro-finance banks productivity can well be summarized as follows:

(i)    That it would translate corporate goals into individual, team, department and divisional goals.

(ii)    That it would help to clarify corporate goals to the understanding of all stakeholders.

(iii)   That it is a continuous and evolutionary process, in which performance improves over time.

(iv)   That it relies on consensus and cooperation rather than control or coercion.

(v)   That it would encourage self-management and individual performance.

(vi)   That it encourages continuous feedback.

(vii) That certain general corporate operational requirements would be specified in such areas as product marketing, budgetary control, cost reduction and security.

(viii) That it would state clearly what the organization, departments and individuals are expected to achieve over a period of time, in terms of targets, tasks and projects.

1.7   ASSUMPTIONS OF THE STUDY

This study was based on the assumption that:

(i)    The information or data collected from respondents would provide adequate and fair information to justify the validity of the study.

(ii)    The respondents would be independent and unbiased in the information they give.

(iii)   The respondents are true representatives of the population.

(iv)   The variables and parameters used for this research will remain constant throughout the period of the study.

(v)   The result of the study will provide solution to the problem identified earlier in this chapter.

1.8   SCOPE AND LIMITATION OF THE STUDY

Recently, performance management has emerged as a powerful management tool, because they involve and empower employees. Hence, workers are more satisfied and higher productivity and product quality typically result.

For the purpose of this research, performance management as a new strategy for optimizing micro-finance bank productivity in Akwa Savings and Loans Limited and will be discussed. This study will corporate performance management concerns, its ethical considerations, background, its processes and 360-degree feedback, etc.

On the other hand, this study suffers from time and financial limitation that does not fully permit in-depth investigation and analysis. However, adequate effort has been made to achieve expected results within the available resources.

1.9   DELIMITATION OF THE STUDY

        This research project will be limited to the role of performance management as a new strategy for optimizing micro-finance banks productivity. And this will be done only at Akwa Savings and Loans Limited and Pillars Micro-finance Banks, Uyo, Akwa Ibom State.

1.10   DEFINITION OF TERMS

(i)    Performance: The organizations ability to attain its goals by using resources in an efficient and effective manner.

(ii)    Management: The attainment of organizational goals in an effective and efficient manner through planning, organizing, leading, and controlling organizational resources.

(iii)   Productivity: The organizations output of products and services divided by its inputs.

(iv)   Process: An organized group of related activities that work together to transfer inputs into outputs and create value.

(v)   Performance Appraisal: The process of observing and evaluating an employee’s performance, recording the assessment, and providing feedback to the employee.

(vi)   Performance Gap: A disparity between existing and desired performance level.

(vii) Performing: The stage of team development in which manager’s focus on problem solving and accomplishing the team’s assigned task.

(viii) Survey Feedback: A type of intervention in which questionnaires or organizational climate and other factors are distributed among employees and the results reported back to them by a change agent.

(ix) Organizational Change: The adoption of a new idea or behaviour by an organization.

(x) Organizational Commitment: Loyalty to and heavy involvement in one’s organization.

(xi)   Performance Test: Performance test measures job applicants performance on actual job tasks. Applicants for secretarial positions, for example, typically are required to complete a keyboarding test that measures how quickly and accurately they type.

(xii)  Performance Feedback: The process through which managers share performance appraisal information with subordinates, give subordinates an opportunity to reflect on their own performance and develop with subordinates, plans for the future.

(xiii) Objective Appraisal: An appraisal that is based on facts and is likely to be numerical.

(xiv) Subjective Appraisal: An appraisal that is based on perceptions of traits, behaviours or results.   

To go back to projects: https://project.edugist.ng/

Queen Elizabeth Commonwealth Scholarships 2022/2023