CHAPTER ONE

INTRODUCTION

1.1     Background to the Study

In the current business world humans are considered as the success factor for any business. For this reason reputed business firms are trying to hire the best human resource that is available in the market so that the firms can maintain its image and goodwill in the future as well. But having capable human resource on board is not an easy task for the firm and for the achievement of this objective the large firms have a separate department known as human resource department (HRD). Armstrong (2001) has stated that the main objective of HRD is to perform four vital functions in which one of them is managerial performance or performance management.

PM is related with the comparison of predetermined goals and objectives with the actual output of the employees. If company is able to achieve the desired results of the organization it shows that employees are achieving their objectives optimally otherwise there is the possibility of some underperformed employees, which are not able to achieve their targets (Stredwick, 2000). According to Armstrong and Baron (1998) PM is a strategic and integrated approach towards the performance of individuals and teams who are delivering their best for the success of the organization. Performance appraisal is the continuous process of monitoring that the organizational goals are achieved in an efficient and effective way (Tyson & York, 2002).

The fundamental goal of performance management is to promote and improve employee effectiveness. The process for linking a company’s compensation plan to individual or team performance includes setting, measuring and rewarding achievable performance expectation (Kagaari, Munene, & Ntayi, 2010). Many people associate performance management with performance appraisal however this is a typical misguided judgment. Anderson and Foss (2005) contends that performance management is the term used to allude to activities, tools, processes, and programs that organizations make or apply to deal with the performance of individual workers, groups, department, and other hierarchical units inside their authoritative control. In contrast, performance appraisal refers to the appraisal of assessing or assessing performance amid a given performance period to decide how well employees, a vendor or an organizational unit has performed in respect to concurred destinations or objectives, and this is one and only of many imperative exercises inside the general idea of performance management.

PM is the vital factor for the success of an organization because in the current world human resources are considering to be one of the essential factors for an organization. Employees should know from the start of the year that what their desired goals, objectives and targets are so that during the year he can put his efforts in the right direction for the achievement of the goals. All the employees should know that at the end of the year their supervisors are going to check their performance by comparing the actual results with the desired results and on the basis of this they can be judged as the over performed, satisfactory or underperformed worker. Employees should also know that their pay and package is dependent upon their performance and the employees who are performing well in the current year they get high pay rise after their performance appraisal.

Performance management systems are crucial to enhance organizational growth (Buchner, 2007) and effectiveness (Cardy, 2004; as cited by Gruman & Saks, 2011). However, despite the touted benefits of utilizing performance management systems, 70% of implementations of these systems fail (McCunn, 1998). In order to put successful performance management systems in place, organizations must know what characteristics of these systems are most instrumental in producing beneficial organizational outcomes. Although previous research has examined the impact of small sets of performance management characteristics, few studies have been conducted that define a comprehensive list of characteristics to determine the ones most predictive of positive organizational outcomes such as perceived effectiveness of the system and engagement. Therefore, the purpose of this study is to find out the implication of productive managerial performance in the general growth of an establishment.

1.2     Statement of the Problem

It has been observed that organization recently are faced with new competitive conditions, and have to cope with dynamic environments, leading them to the era of continuous improvement, value added, doing more with less, and productivity (Kagaari, Munene, & Ntayi, 2010). These developments have brought performance management to center stage.

Some organizations though invest so much in other factors of production such as machinery, information technology, funds etc but unfortunately place little value on manpower. In this regard, little attention is directed to improving the human capital which is the anchor of every organizational success story. Improving manpower requires that performance management becomes an essential tool to assess the individual employee and should be based on consistent feedback such that an appropriate reward system could be ascribed or measures for correction could be put in place. Lack of performance appraisal system in most organizations unfortunately makes assessment of individual employee extremely difficult and m that vain most organizational targets are not periodically achieved hence lack of direction and low productivity.

1.3     Objective of the Study

The main objective of this study is to find out the implication of productive managerial performance in the general growth of an establishment, specifically the study intends to;

1.     Find out the impact of managerial performance on organization growth

2.     Analyze the implication of productive managerial performance in the general growth of an establishment

3.      Examine the challenges of achieving a good performance management

1.4     Research Question

1.     What is the impact of managerial performance on organization growth?

2.     Is there any implication of productive managerial performance in the general growth of an establishment?

3.     What is the challenges of achieving a good performance management?

1.5     Research Hypothesis

Ho: there is no implication of productive managerial performance in the general growth of an establishment

Hi: there is implication of productive managerial performance in the general growth of an establishment

1.6     Significance of the Study

By measuring performance, nonprofit organizations can improve their effectiveness and enhance their ability to deliver on their mission. Developing a useful performance management system with related measures might realistically be viewed as an essential component of effective program management and service delivery.

This study will also give an empirical evidence of the strategic role of performance management in organizations and will also identify areas that can be pursued for future research.

1.7     Scope of the Study

The study is concentrated on implication of managerial performance on general growth of an establishment, the research work will examine managerial performance and organizational growth in De-United Food Industries Limited.

1.8     Delimitation of the Study

Finance for the general research work will be a challenge during the course of study. Correspondents also might not be able to complete or willing to submit the questionnaires given to them.

However, it is believed that these constraints will be worked on by making the best use of the available materials and spending more than the necessary time in the research work. Therefore, it is strongly believed that despite these constraint, its effect on this research report will be minimal, thus, making the objective and significance of the study achievable.