CHAPTER ONE
INTRODUCTION
1.1. Background of the Study
In this 21st century, the workplace is a fast-paced, dynamic, highly motivating environment that comes with a lot of benefits and opportunities to those who work within it. Across the world, the success and effectiveness of any organization can be traced to the performance of its employees. This is because employees are an organization's most valuable asset and also they are the most difficult resource for any organization to manage. Therefore, the ability to involve its employees in decision making is a key feature of a successful business towards achieving organizational productivity.
Organization productivity is an assessment of the efficiency of the organization in terms of product outputs. According to Mathias and John (2015) productivity is a measure of the quantity and quality of work done, considering the cost of the resources used. The more productive an organisation, the better its competitive advantage, because the costs to produce its goods and services are lower. Better productivity does not necessarily mean more is produced; perhaps fewer people (or less money or time) was used to produce the same amount, (Mathias & John, 2015). McNamara (2017) affirmed that, results are usually the final and specific outputs desired from the employees. Results are often expressed as products or services for an internal or external customer, but not always. They may be in terms of financial accomplishments, impact on a community; and so whose results are expressed in terms of cost, quality, quantity or time, (McNamara, 2017). Measuring productivity involves determining the length of time that an average worker needs to generate a given level of production.
In Europe, many companies have recognized the importance of involving employees in decision making towards achieving organizational objectives, (Management Study Guide, MSG, 2016). It was observed that companies that employ participative management approach have recorded dramatic breakthrough in the area of operational cost, high profit margin and work productivity. Through the involvement of employee in decision making, individuals are offers the chance carry job responsibility and partake in joint decision making for the whole welfare of the firm (Management Study Guide, MSG, 2016). In a number of companies, the power of formulating decision depends on the magnitude of confidence gains into a certain jobs. This provides the opportunity for employees to make recommendations and contributions needed to achieve organizational performance, (Jones, Kalmi, & Kauhanen, 2017).
In the UK, the employees’ involvement in decision-making tends to build a sense of workforce membership, as well as a comfy atmosphere in which leaders and managers are willing to impart to a stable industrial relationship, (Sagie & Ayean, 2017). Managers are meant to allow a high engagement level in determining employee interaction and contextualize their workplaces with the goal of enhancing job results and civic responsibility. The role of employees in strategic planning was thus seen as a way to inspire players to retain decent jobs and quality expectations of jobs, (Noah, 2018). Therefore, the importance of employees’ in decision making process has been recognized by the actions of management and employees as the management method to restore organizational efficiency, (Singh, 2016). The study of Somech (2020) revealed that involving employees in decision making is the best thing ever towards attaining organizational performance.
In the USA, the success of an organization relies on involving the workforce’s entire capacity to generate new ideas and ways of working to outsmart their competitors, (Beardwell & Claydon, 2017). Employees must be involved if they are to understand the need for creativity and employees must be involved if they are to be committed to changing their behaviours in work, in new and improved ways, (Helms, 2019). The involvement of employees in decision making serves to create a sense of belonging among the employees as well as a congenial environment in which both the management and the employees voluntarily contribute to healthy industrial relations, (Noah, 2018). A contemporary business organization looking to achieve profitability, productivity and overall performance will not keep its employees in the dark about vital decisions affecting them, (Helms, 2019). It trusts them and involves them in decision making at all levels. The use of “Command and Control” is no longer an adequate approach to organization management. However, a more open and collaborative approach will exploit the talents of all employees, (Hewitt, 2019). Ezennaya (2020) stated that in the United States of America (USA), Britain, Germany and other developed countries of the world, participatory management is one of the key factors that aid organization and economic success. For example in the USA, industrial democracy is practiced, employees are encouraged to buy shares in companies thereby enabling them to have a say in the management of their organization. In other developed countries such as Britain and Germany, participatory management is popular. In Britain, it is referred to as the joint consultation whereas in Germany, it is referred to as co-determination.
In Africa, recent developments in the way employees are managed in organizations have brought about the need to seriously consider employees as major stakeholders in organizations (Tchapchet, Iwu, & Allen-Ile, 2020). At a time when employees in other parts of the world are regarded as the main source of competitive advantage, South Africa is still enmeshed in a labor crises typified by industrial actions. Voss and Gruber (2018) asserted that in order for public HE institutions to provide services of good quality to the students (who are the customers of public HE institutions), the employees should be knowledgeable, well-organized, encouraging, helpful, caring to students’ needs, approachable, experienced, friendly and should have good communication skills. Rendering services of good quality will help improve the productivity (that is more graduates) of public HE.
In South Africa, employee participation is considered to be a crucial element in effectively introducing advanced management techniques and a significant determinant in evaluating the degree of accountability, (Barringer, & Bluedorn, 2018). In essence, this strengthens the individual employee dedication and inspiration. In addition, Higgins (2015) suggests that engagement is a cognitive and emotional replication to achieve organisational goals and objectives, importance in the business context. For example, Barringer and Bluedorn (2018) argued that a chance to engage employees in decision-making tends to build trust and to deliver inherent incentives towards staff and supervisors.
In Ghana, organizations are facing issues of casual employment amongst indigenous employees, unrealistic target given to new employees, personality differences, adapting to changing environment such as globalization and technology, challenge of different faith and culture, challenge faced in handling difficult people and situation etc. These often resulted in employees’ turnover, dissatisfaction, among others. Employee leave has been broadly viewed as a disadvantage for firms losing valuable human capital, affecting performance negatively and implicating replacement costs in the form of recruitment and training (Campbell, Ganco, Franco & Agarwal, 2019).
In Nigeria, Rubyutsa (2015) posited that participatory management does not exist and cannot exist as a result of under development, inexperience in democratic process and economic instability caused by frequent changes in economic policy by the federal government. In the opinion of Ojokuku and Sajuyigbe (2018), they stated that participative decision making can be well practiced only in a stable economic environment because it is time consuming in nature and investment in training to enable workers have a contributing capacity. Ezennaya (2020) was of the opinion that participative decision making can be possible in a certain sector of the economy and not in all government owned enterprises because of the government intention to mobilize popular support for development purposes. Ezennaya (2020) further affirmed that employees participation in the multinational companies, on the other hand has at best remained elusive. Most of these companies are controlled by and rely on their parent bodies abroad for policies and decision. Among the indigenous organizations, especially the small and medium sized organizations, their attitude to employees is paternalistic and based on authoritarianism, (Ezennaya, 2020). Their activities are often shrouded on secrecy. They are suspicious of the employees and therefore cannot afford to share information and decision with them.
Most studies examined have shown that the engagement of employees in decision making will eliminate and reduce staff absenteeism, increase individual commitment, improved performance, increase job satisfaction, employees feel as being part of the organization, and this raise their degree of worth importance within the organization, (Aliyu, 2019). In a study conducted by MSG (2016) revealed that, the involvement of employees in decision making has promoted the level of individuals’ satisfaction on the job. When people have that feeling that there are been involved on decision process of the firm the find there salve, that only can motivate them to put in their best even when the cash reward is not fort coming they are not demoralized in making sure that organizational goal and objective is been achieved.
Therefore, based on the above, this study seeks to examine the effect of employees’ decision making in an organizational productivity in Guaranty Trust Bank Plc, Sagamu, Ogun State.
1.2. Statement of the Problem
In the past years, a substantial amount of literature has emerged about employees’ involvement in decision making process and its impacts on organization performance. Research into this topic has spanned diverse fields, which include economics, human resource management (HRM), strategic management, and sociology. However, while each of these respective research streams has provided valuable insights into the antecedents and consequences of employees’ involvement in decision making process; the result is a research literature on employee decision making that is highly fragmented and disorganized. Despite its lack of consistency and mixed reactions, literature on employee decision making is of particular interest to this present study.
Quite a number of studies have shown high performance of employees, including those at the lower level management when they are involved in the decision-making process (Nnabuife, 2017). Understandably; these workers who are closer to the problems of clients have the understanding and knowledge necessary to make important decisions. A similar argument is shared with Rubyutsa (2015) who argued that the lower-level managers and operational employees are closer to the activities and typically have more detailed knowledge about problems than do top managers. Most studies observed that these lower-level managers and operational employees are not carried along in decision making process thus giving rise to low employees' commitment, poor cooperation between managers and employees, low job satisfaction, low employee morale, and finally poor organizational performance.
Leng (2014) did research on the impact of employee creativity on the performance Retail Industry in Malaysia. The findings concluded that the involvement of employees in decision making enhances their creativity on organizational performance. Also, there is not enough study examined in this regard which is a gap this study will fill. In addition, this present will adopt a more comprehensive technique such as the ANOVA and regression analysis in analyzing the data collected, which will offer more robust findings for the study.
In a study conducted in South Africa by the Human Sciences Research Council for the Education Labour Relations Council in 2005, it was found that 55% of teachers would leave their job if they could. The reasons cited for this included workload stress, low salaries, lack of discipline in schools and lack of career advancement. Zimbabwe is reported to have lost very many newly qualified teachers who probably sort greener pastures. The problem of teacher turnover in Malawi is also reported to be over whelming in relation to other developing countries (Xaba 2015). Kaiser, Kongsted, and Rønde (2015) also found that the social network effects when employees leave to join another firm is not only positive but cancel out the loss of knowledge from the employee leaving the firm. The benefits from employee mobility is not limited to organizations, employees that change jobs have shown to perceive more positive outcomes than those that do not (Fields, Dingman, Roman, & Blum, 2016). The benefits found from engaging in mobility includes higher salary, reduced stress, more job autonomy, better advancement opportunities and higher job satisfaction.
The study of Ezennaya (2020) revealed that, the task of decision-making seemed to be a task of top management. Obviously, this has direct or indirect negative impacts on those companies, in terms of employee commitment, cooperation between managers and employees and finally on organizational performance. Employees seem to show greater commitment to decisions in which they have participated or consulted. It is therefore maintained that when groups are excluded from effective roles in decision-making affecting them, they tend to react in aggressive, polarizing ways (Rubyutsa, 2015). Public enterprise administration in developing countries has been consistently plagued with the tendency toward excessive centralization.
Sunia (2020) stated that, in every contemporary organization, it is very important that individuals work as a team regardless of their cultural background and race. However, this can be very exciting, but as well be very frustrating in most cases, (Bindu, 2018). Thus, it becomes imperative for every organization to find ways on how to effectively manage these issues. The study of Kochan, Bezrukova, Ely, Jackson, Joshi, Jehn, and Thomas (2019) revealed that the employees of today’s business environment are more diverse in nature than in the past and if their diversity is not properly managed, it could affect the ability of a business to achieve team success and innovative ideas. In the study of Ang, Van Dyne, Koh, Ng, Templer, Tay, and Chandrasekar (2020), the authors revealed that the rate of diversity in today’s workplace will negatively affect organizational factors like teamwork, innovativeness and creativity, positive communication, and problem solving if not effectively managed. However, the various empirical findings showed mixed findings.
The problem statement identified is that, empirical findings has revealed a mixed reaction to the study, thus, it is important to find out how employees’ decision making affect organizational productivity in Guaranty Trust Bank Plc, Sagamu, Ogun State, to know whether the findings of this study will corroborate earlier studies in relation to the topic. Therefore, discovering the main problems affecting employee involvement in decision-making in Guaranty Trust Bank Plc, Sagamu, Ogun State, becomes an important factor at this time hence, the following variables: employee perception, employees job satisfaction, employees teamwork, employees creativity, and employees exit or leave were operationalized and examined to ascertain the effect of employees’ decision making in an organizational productivity in Guaranty Trust Bank Plc, Sagamu, Ogun State.
1.3. Research Objectives
The main objective is to examine the effect of employees’ decision making in an organizational productivity in Guaranty Trust Bank Plc, Sagamu, Ogun State. In order to achieve the main objective, the following specific objectives are to:
- assess the effect of employees perception on organizational efficiency in Guaranty Trust Bank Plc, Sagamu, Ogun State
- examine the effect of employees job satisfaction on organizational effectiveness in Guaranty Trust Bank Plc, Sagamu, Ogun State
- investigate the effect of employees teamwork on organizational profitability in Guaranty Trust Bank Plc, Sagamu, Ogun State
- find out the effect of employees creativity on organizational implementation in Guaranty Trust Bank Plc, Sagamu, Ogun State
- determine the effect of employees exit on organizational turnover in Guaranty Trust Bank Plc, Sagamu, Ogun State
1.4. Research Questions
The following are the research questions posed for the study.
- What is the effect of employees’ perception on organizational efficiency in Guaranty Trust Bank Plc, Sagamu, Ogun State?
- What is the effect of employees’ job satisfaction on organizational effectiveness in Guaranty Trust Bank Plc, Sagamu, Ogun State?
- What is the effect of employees’ teamwork on organizational profitability in Guaranty Trust Bank Plc, Sagamu, Ogun State?
- How does employees’ creativity enhance organizational implementation in Guaranty Trust Bank Plc, Sagamu, Ogun State?
- What is the effect of employees exit on organizational turnover in Guaranty Trust Bank Plc, Sagamu, Ogun State?
1.5. Research Hypotheses
The research hypotheses for this study are formulated in their null form
Ho1: There is no significant effect of employees’ perception on organizational efficiency in Guaranty Trust Bank Plc, Sagamu, Ogun State
Ho2: There is no significant effect of employees’ job satisfaction on organizational effectiveness in Guaranty Trust Bank Plc, Sagamu, Ogun State
Ho3: There is no significant effect of employees’ teamwork on organizational profitability in Guaranty Trust Bank Plc, Sagamu, Ogun State
Ho4: There is no significant effect of employees’ creativity on organizational implementation in Guaranty Trust Bank Plc, Sagamu, Ogun State
Ho5: There is no significant effect of employees exit on organizational turnover in Guaranty Trust Bank Plc, Sagamu, Ogun State
1.6. Operationalization of Research Variables
The dependent variable is employees’ decision, represented by Employee Perception (EP), Employee Job Satisfaction (EJ), Employee Teamwork (ET), Employee Creativity (EC), and Employee Exit (EE). On the other hand, organizational productivity, being the independent variable, is proxied by Organizational Efficiency (OE), Organizational Effectiveness (OE), Organizational Profitability (OP), Organizational Implementation (OI), and Organizational Turnover (OT).
Where Y= Dependent variable
X= Independent variable
Y= f(X)
X= Stress
X = Employee Decision
X = f(x1, x2, x3, x4, x5)
x1= Employee Perception (EP)
x2= Employee Job satisfaction (EJ)
x3= Employee Teamwork (ET)
x4= Employee Creativity (EC)
x5= Employee Exit (EE)
Y= Organizational Productivity
Y= f(y1, y2, y3, y4, y5)
y1 = Organizational Efficiency (OE)
y2 = Organizational Effectiveness (OE)
y3 = Organizational Profitability (OP)
y4 = Organizational Implementation (OI)
y5 = Organizational Turnover (OT)
The four specific objectives are operationally expressed as:
To assess the effect of employees perception on organizational efficiency in Guaranty Trust Bank Plc, Sagamu, Ogun State.
Y1 = f (x1)
Y1 = b0 + b1x1 + u
To examine the effect of employees job satisfaction on organizational effectiveness in Guaranty Trust Bank Plc, Sagamu, Ogun State
Y2 = f (x2)
Y2 = b0 + b1x2 + u
To investigate the effect of employees teamwork on organizational profitability in Guaranty Trust Bank Plc, Sagamu, Ogun State
Y3 = f (x3)
Y3 = b0 + b1x3 + u
To find out the effect of employees creativity on organizational implementation in Guaranty Trust Bank Plc, Sagamu, Ogun State
Y4 = f (x4)
Y4 = b0 + b1x4 + u
To determine the effect of employees exit on organizational turnover in Guaranty Trust Bank Plc, Sagamu, Ogun State
Y5 = f (x5)
Y5 = b0 + b1x5 + u
1.7. Scope of the Study
The study is limited to the effect of employees’ decision making in an organizational productivity in Guaranty Trust Bank Plc, Sagamu, Ogun State. The unit of analysis of the study is the entire employees of Guaranty Trust Bank Plc,, Sagamu, Ogun State at Junior, Middle, Senior, and Management level positions. The population is given as 112, while a sample of 86 employees of Guaranty Trust Bank was selected from the study using the Yamane formula. The simple random sampling technique will be adopted to administer the questionnaire, in order to ensure that both male and female employees have equal chance of being selected for the study, while data gathered will be analyzed using the regression and ANOVA analysis. The geographical location for this study is Sagamu, Ogun State, Nigeria. The time frame for the study is employees working in Guaranty Trust Bank Plc for a period of 5 years and above (2016 till date).
1.8. Significance of the Study
The finding of this study is expected to contribute to the existing literature in the field of employees’ decision making and organizational productivity. In addition, this study will act as a reference point for further research to refine and extend the present study.
The study is significance of organization management in the sense that it will enlightened them on the need to integrate employees in decision making process in an organization towards ensuring the organization productivity and performance.
Furthermore, the findings will help draw recommendations on how the issue of employee participation in decision making can be handled by the organization management, stakeholders, as well as the government.
The findings will as well be important to industry in sense that it will help provide knowledge in adjusting or modifying the factors leading to high rate of employee turnover. Besides, it will help industry management to have a structured and policy in place that will be of benefit to both organization and employees betterment.
1.9. Operational Definition of Terms
Employee Perception: refers to the various diverse perception of employees in an organization.
Employee Job satisfaction: is the difference between the inputs made by employee and the outputs receive from the job, (Kotler, 2016).
Employee Teamwork: refers to how a group of individuals’ works together to achieved a given task, (Jones, Richard, Paul, Sloane, & Peter, 2017).
Employee Creativity: is explained as a design in which the employee make such innovative construction in which the work related problems are resolved in rightful manner with step by step process (Amabile, 2018).
Employee Exist: is the movement of talented employees out of an organization
Organizational Productivity: is an assessment of the efficiency of the organization in terms of product outputs.
Organizational Efficiency: refers to the efficiency of an organization task accomplishment (Sheehan, 2015).
Organizational Effectiveness: refers to the degree to which an employee achieved desired results in line with organizational goals and objectives, (Yesufu, 2016).
Organizational Implementation: refers to the process of carrying out, execution or practice of a plan in order to achieve a set goal, (Bhasin, 2019).
Organizational Turnover: refers to the ability of an organization to achieve turnover.
1.10. Historical Background of Guaranty Trust Bank
Guaranty Trust Bank Plc (GTBank) is a foremost Nigeria’s financial institution incorporated as a limited liability company licensed to provide commercial and other banking services to the Nigerian public in September 1990. The bank commenced operations in February 1991, and became a publicly quoted company in 1996 (GTB, 20202). The bank won the Nigerian Stock Exchange President's Merit award that same year and subsequently in the years 2000, 2003, 2005, 2006, 2007, 2008, 2009, 2011, 2013, 2015, 2016, and 2018. Presently, the bank has over 2 trillion Naira asset base, with shareholder’s funds of over 200 billion Naira and employs over 5,000 people in Nigeria, Cote d'Ivoire, Gambia, Ghana, Liberia, Sierra Leone and the United Kingdom (GTB, 2020).
In 2007, the bank became the first Nigerian financial Institution to undertake a US$350 million regulation Eurobond issue and a US$750 million Global Depositary Receipts (GDR) Offer. The listing of the GDRs on the London Stock Exchange in July 2007 made the bank the first Nigerian Company and African bank to be listed on the main market of the London Stock Exchange. In December 2009, the bank also successfully completed the first tranche of its $200 million corporate bond targeted at increasing the depth of its operations in West Africa and Europe. Similarly, GTBank launched a US$500 million bond, the first non-sovereign benchmark bond offering from sub-Saharan Africa (outside South Africa), to the international community in May 2011, (GTB, 2020)
GTBank mission describes the company’s product, market, and technological focuses which reflect the values and priorities of the company’s strategic. The bank mission establishes major goals thereby providing the company’s a sense of direction and encourages higher levels of performance. In essence, mission statement is a broad declaration of a firm’s purpose which identifies the company’s products and customers; thus distinguishes the company from its competitors. GTBank mission and vision statement are stated below (GTB, 2020):
We are a high quality financial services provider with the urge to be the best at all times whilst adding value to all stakeholders. We are a team driven to deliver the utmost in customer services. We are synonymous with innovation, building excellence and superior financial performance; and creating role models for society. The bank mission and vision statements highlight its purpose, i.e. what the company is now and what it would like to become.
Strength constitutes capabilities and resources which give the bank an advantage compared to its competitors in meeting the need of the customers. The bank strengths are highlighted below: GTBank has stronger capital base. The bank strong capital base assists the bank to increase its share of business with core corporate customers; thus, provides total banking solution (GTB, 2020). The bank has high corporate lending expertise and reputation founded upon the quality and professionalism of its staffers (GTB, 2020). In 2006, GTBank was accredited with International Standards Organization (ISO) quality mark for service providers (GTB, 2020). The bank is the first Nigerian bank so accredited.
GTBank is the first Nigerian company and African bank listed on the London Stock Exchange. In 2007, the bank was listed on the main market of London Stock Exchange having raised $750 million through the issuance of a Global Depositary Receipt (GTB, 2020).
The bank is rated by international rating agencies (including, Fitch and Standard & Poor’s; and Augusto & Co) as the best Nigeria’s bank (GTB, 2020). The strong ratings have assisted the bank to attract more customers and enhance its reputation. The bank also has positive ethics; thus, facilitates improved customer relationship.
GTBank has invested heavily on telephone contact center to accelerate its retail banking and ensure real time responses to customers’ enquiries and problems (GTB, 2012). In addition, the bank is adjudged the most satisfied e-banking customers, and a leading internet banking provider in Nigeria as per the Intermac Consulting 2007 Nigeria e-Banking Survey. The bank also features in Interswitch’s top 3 in ATM and card usage.
The bank has positive and good corporate governance. This is obvious from the bank’s noticeable lack of contraventions in banking legislation, unqualified audit report, lack of nonperforming insider-related credits and IFRS compliance.
Weakness connotes limitations of a firm resources and capabilities resulting to ineffective meeting of the bank customer’s needs relative to its competitors. GTBank weaknesses are highlighted below: The bank liquidity is a concern as a recent study reveals that it has a worst maturity mismatch and advances are long term in nature with deposits being demand deposits. The bank has a concentrated customer base which makes her susceptible to deteriorating industry specific conditions. The bank’s pillars consist of reputation, professionalism, innovation, service and ethics (GTB, 2020). These pillars are particularly valued by corporate clients. However, previous studies revealed that some pillars of GTBank (i.e., excitement, belonging, fun and ubiquity) lack attribute good consumer brands.
