THE EFFECT OF COMPENSATION MANAGEMENT IN IMPROVING EMPLOYEES’ PERFORMANCE IN AN ORGANIZATION (A Case Study of Nigeria Ports Authority, Apapa)
Compensation management is one of the most important aspects of personnel management. It covers economic rewards in form of wages and salaries as well as in various forms of non-wage economic payment known as fringe benefits, indirect compensation or supplementary pay. Therefore, this research work has been carried out to look at the impact of organizational compensation management system on the performance of employees in the public sector.
The research found out that compensation management has a great impact on the performance of employees in the organization and that there are other factors which re not monetary inclined that contributed greatly to the performance of employees. Factors such as; motivation, leadership, communication, control, sense of belonging and decision making. It is therefore hoped that this project will help in understanding the impact of compensation management on employees’ performance. The project is intended to create awareness for organization members, society and government. Also the general reader will find it educating and informative. The need for this study arises from the variation in performance of employees in the organization that has been noticed and this research work hoped to improve the standard and in order to achieve this, project has gone into so many past works of authors and related literatures in order to profound solutions.
This study is divided into five chapters covering the wide scope of compensation management. Chapter one deals with the general focus of the study. Chapter two tries to review various concepts and theoretical strands that are relevant to this study. In chapter three, attempt was made to look into the methodology of the study. Chapter four endeavour to present, analyze and summarize the data collected in the course of the study. The conclusion of the study is in chapter five where general discussions, conclusion and recommendations were made. These were considered relevant to improve the impact of compensation management on employees’ performance. In the analysis of the research work it was concluded that compensation management system has a great impact on employees’ performance.
TABLE OF CONTENT
Title page 1
Table of contents 3
CHAPTER ONE: Introduction
1.0 Introduction 5
1.1 Statement of Problem 8
1.2 Research Questions 8
1.3 The Hypothesis which this study tested 9
1.4 Purpose of Study 9
1.5. Relevance of Study 9
1.6 Scope of the Study 10
1.7 Significance of the Study 10
1.8 Limitations of the Study 11
1.9 Literature to be Reviewed 11
1.10 Method to be Sold 11
1.11 Definition of Terms 12
1.12 Operationalisation/Definition of Variables 12
1.13 Brief History of Guaranty Trust Bank Plc 12
CHAPTER TWO: Literature Review
2.1 Introduction 16
2.2 Assessment of Training Needs 19
2.3 Training Objectives 20
2.4 Present Status 20
2.5 Determination of Training Effectiveness 23
CHAPTER THREE: Research Methodology
3.0 Introduction 48
3.1 Research Design 48
3.2 Characteristics of the Study Population 49
3.3 Sample Size and Procedure 49
3.4 Data Collection and Administration 49
3.5 Data Analysis 49
CHAPTER FOUR: Presentation of Data Analysis
4.0 Introduction 51
CHAPTER FIVE: Summary, Conclusion and Recommendation
5.0 Summary 66
5.1 Research Findings 66
5.2 Conclusions 66
5.3 Recommendation 67
Appendix I 70
Appendix II 71
Business is becoming more complex and human elements remain an indispensable component of its survival. Training is a sort of investment from which an organization expect some positive returns. It involves the development or modification of behaviour of employee in such a way that they become more effective at their duty post.
Flippo (1980) said that when employees have been selected, recruited and inducted, such employee must be develop to better fit the job and the organization since on one is perfectly fit at the time of hire. Soetan, (1995) also buttressed this point when he said that training is always necessary when required skills, attitude and knowledge are either inadequate or completely lacking and when performance deficiencies that can be eliminated through training are identified.
However, training is often aimed at increasing productivity, improving quality of work, raise moral as well as development of new skills, knowledge and attitude. Development on the other hand, is a learning activity which is directed toward future rather than present needs and which is concerned more with career growth than immediate performance. The focus of development tends to be more on future manpower requirement and other growth needs of individual in the workplace.
Training and development are not synonymous. Whiles training is the process of improving job behaviour of an employee immediately, while development is future oriented often geared toward preparing an employee for greater responsibilities in the future.
Effective management of change calls for a dynamic human resources development policy to ensure that each staff in an organization possesses requisite knowledge, skills experience and expertise for the performance of his task.
The Administrative approach is based on the number of employees to be trained in one year at a particular period. The needs of the employee or the organization is not considered rather it depend on whose turn it is to go for training and the number of staff the budget can take care of. This approach, the employees is sent to improve his/her welfare either financially academically or otherwise. The employees is sent for training for his/her personal benefit. In organization, a measure of polities exist as the employee interact with one another here, training selection is based on either or some of the following lobbying, setting rid of some troublesome employees and projection of individual’s personal image, this is know as political approach. The organization development approach is usually adopted where the management cadre in an organization are made to attend training programmes as a result of poor performance of a unit or division as the case may be.
In systematic approach, the need of the employee is identified from the gap between his actual performance and the desired performance. Periodic performance appraisal can provide very useful data to identify these needs` systematic approach to training is preferred in profit oriented organization because it is often job related and is directed toward the achievement of organization goals.
Training and development usually takes two forms namely:
- House training
- Off house training
In-house training is usually carried out within the organization e.g. induction course, on-the-job training coaching programmes, etc here, the training is done in the normal work environment situation with the trainee using the actual tools, equipment and material that he/she will use when he/she is fully trained. On the other hand, off-house training takes place outside the organization, for instance management consultant and training institutions organized training programmes which employee attends. Evaluation training it decides whether training justifies it cost or whether it is doing what it set out to do.
The main goal of training is to improve employee ability to perform specific tasks. Many organization therefore spend a deal of time and money on training and development of their employees. However, management is justifiable worried about the effectiveness of training programmes in term of content, method usefulness and result. There are many approaches to training depending on the purpose it is expected to serve.
v Administrative Approach
v Welfare Approach
v Political Approach
v Organizational development Approach
v Systematic Approach
Boydel C. (1971) has suggested the following ten steps as constituting systematic training process.
v Identification of the occupation chosen as priority.
v Examination of the occupation chosen as priority
v Analysis of the occupation
v Specification, selection, and appraisal of the people to be training
v Setting training objectives
v Planning of the training programme
v Implementation of training programme
v Checking / assessment of the training
Budgeting for training can be described as a process for systematically relating expenditure of funds for training to accomplish its planned objectives. The main purpose of training budget is to have realistic estimates of funding necessary for the training services which are meant to be crucial to the achievement for organizational goal both in short times and long time basis. According to Douglas (1969), the step to follow in preparing a training budget are as follows.
- Assess the training needs of the organization
- Draw a training programme for the year
- Document the annual budget for the training schools or department
The time to be spend on training
The number of people to be trained
The incidental expenses such as traveling expenses.
1.1 STATEMENT OF PROBLEM
In line with recent changes in business circles, human resources department (HRD) have come to stay. This department is usually responsible for handling matters on training and development while personnel and administrative department which have been in existences are still in charge of all other matters. This is done to ensure that all employees are assisted with programmes to enable them acquire additional knowledge, skill and attitude with which to perform their jobs.
It is common knowledge that most companies recognize that their principal asset lies within the skill of their employee at all level. Therefore, this research work is aimed at finding answer to questions relating to the impact of training on performance.
1.2 RESEARCH QUESTIONS
In the research, attempt shall be made to find answer to the following question
Is job performance dependent on staff training?
Is job dedication dependent on training received?
Is job commitment a function of training received?
Is labour turn-over a function of training received?
1.3 THE HYPOTHESIS WHICH THIS STUDY TESTED ARE:
HO: Job performance is not dependent on staff training?
H1: Job performance is dependent on staff training?
HO: Job dedication is not dependent on training received?
H1: Job dedication is dependent on training received?
HO: Job commitment is not a function of training received?
H1: Job commitment is a function of training received?
HO: Job security is not a function of staff training?
H1: Job security is a function of staff training?
HO: Labour turn over is not function of training received?
H1: Labour turn over is not function of training received?
1.4 PURPOSE OF STUDY
The purpose of this study is to examine the effect or extent which training motivates workers toward greater job performance in the banking industries. It also examines the training method being employed and it examine what can be regarded as adequate manpower raining and development on employees performance and how organization can improve employee performance beyond the impact of training and development.
1.5 RELEVANCE OF STUDY
Many organization spend a great deal of time and money on training and development of their employees, however the management of some companies are often worries about the effectiveness of such training and development programmes in terms of content, methods, usefulness and desire results. This research effort attempt to evaluate the impact of training and development on employees performance of a firm in the banking industry.
Training and development of employee is very relevant to an organization since it may increase high rate of workers turn over and encourage employee to stay with an employer for an appreciable period.
Secondly, there are chance of prevention of industries folding up if they have competent and well trained staff delivering improved and better services in line with the organization’s goal and objectivities. This will in turn enable our home made product and services to compete favorably with foreign products and services. Training programme also usually provide a job chance designed to improve the quality of work life the hope that the employees will reciprocate with training gives the employees a fair chance to better performance and avoids the frustrating experience of poor performance. Effective training and motivation therefore ensure the loyalty of employee and invariable, high productivity through the avoidance of wastages.
1.6 SCOPE OF THE STUDY
Many organization spend a great deal time and money on training and development of their employee, however the management of some companies are often worried about the effectiveness of such training and development programmes in terms of content, method usefulness and desired to content, this research effort attempt to evaluate the impact of training and development on employees performance of term in the banking industries.
1.7 SIGNIFICANCE OF THE STUDY
Training can result in improve individual dedication and job satisfaction as performance when training requirement are determine by analyzing the work to be done the manpower resources available and the present and future environmental demand or organization.
All new employees, regardless of their previous training, education and experience, need to be introduced to their new employee’s work environment and to be taught how to perform specific tasks, moreover specific occasion, for training arise when job changes, and new skills must be introduced by advancing automatic.
As some employees respond to continue training, they can be progressively increase their value to organization and prepare themselves for promotion. Continues training can help employee to develop their ability to learn, adapt themselves to work methods, learn to use new kinds of equipment and adjust to method changes in job content and work relationship.
1.8 LIMITATIONS OF THE STUDY
The bank under investigating, guaranty Trust Bank had about 3,000 employee in the entire organization, it also has about 15 branches in Lagos due to the monetary and time constraints, the researcher limit the research to the Allen Avenue branch and training center also situated and it head office.
The study also does not intend to look into other factors hat are known to improve employees job performance such as motivation of staff in terms of monetary reward and fringe benefit etc.
1.9 LITERATURE TO BE REVIEWED
This existing literature reviewed is on manpower training and development. The view of management expert in the relationship between training, development and performance was examined. Training is a process of changing behavior of member of an organization in such a way to contribute effectively to the growth of the organization.
1.10 METHOD TO BE SOLD
This is the method through which the research was conducted; the focus is highlighting, the effective training on employees’ performance. In other words, we are interested in evaluating the effect of training and development on employee. The research activity was confirmed to the workers of Guaranty Trust Bank Plc. The subjects were both female and male the research instrument use for the study was a questionnaire the questionnaire was designed to find a number of issue such as:
- Whether employees who are trained enhance the performance of employee.
- Whether training has no significant relationship to labour turn over.
- Whether the time, money, material etc. invested on training is justified.
1.11 DEFINITION OF TERMS
Training and development it all about growth of an organization, training has been one of the great factor that makes organization to achieve their growth, goals and objectives performance, the word performance is all about the effort carried out in an organization by the employee to me training and development contribute to performance, after every employees have been trained with high training, it will surely enable them to perform very well, so in the other word training and development leads to higher performance.
1.12 OPERATIONALISATION / DEFINITION OF VARIABLES
For the purpose of this study, a number of concepts would feature prominently and attempts will be made to define them within the frame work of this project.
TRAINING: This is the systematic acquisition of skill, concept or attitude that results in improved performance in an organizational setting.
Training needs: This represent the gap between the kind of performance an employee has and the kind of performance which is expected to have which can otherwise be bridged by systematic training.
1.13 BRIEF HISTORY OF GUARANTY TRUST BANK PLC
Guaranty Trust Bank Plc received it license to commence commercial banking activities in Nigeria in August 1990, however the curtain actually rose in February 1991 when the bank opened the doors of its first office called “the Plaza” to the public.
The Plaza becomes a high benchmark for style and service in financial service provision. It may not have been rare but it was certainly not common that a new bank would insist on having its own purpose built premises and they go ahead to invest massively in functional technology before official commencing business. This was simply a reflection of Guaranty Trust Bank’s insistence on doing things right and doing the right things, from the very beginning it was important that the customers should begin to perceive and experience value added services, right from the moment they stepped into the premises. This is they unifying aesthetic quality at all branches from one branch in 1991, guaranty rust ban currently has twelve branches each strategically located to penetrate the major hubs of commerce in Nigeria. The following year, the Ikeja and broad street branches opened between 1995 and 1998, branches were opened in Apapa, Kaduna, Abuja, Onitsha, Aba Ibadan and Warri.
Meanwhile, the bank was moved its corporate headquarters from the plaza to plural house in October 1994. Then in September 1996, the bank became a publicly quoted organization with its share traded on the Nigeria stock exchange.
In its first year on the exchange, Guaranty Trust Bank earned the president’s merit award, the highest award bestowed on deserving members of the stock exchange. In 1998, after an in-depth strategic planning exercise, the offshoot of which included a major restructuring of the organization, the vision was tested and held through while the mission statement was reviewed as follow.
“We are the first class financial services provider possessing the urge to win at all times consistently adding value to all stakeholder.
Than bank has remained a learning organization learning new ways to delight its customer-sweet on the counters, a hand umbrella on a rainy day, aesthetic, function premises and technology has always been a passion with management from its early days of operations until today, guaranty trust bank has utilized functional contemporary technology that has kept is ahead of the curve.