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NEW GENERATION UNIVERSITY COLLEGE

DEPARTMENT OF BUSINESS ADMINISTRATION

ASSESSEMENT OF PERFORMANCE APPRAISAL SYSTEM: THE CASE STUDY OF


COMMERCIAL BANK OF ETHIOPIA
RESEARCH PROPOSAL SUBMITTED TO PARTIAL FULFILLMENT OF THE REQUIREMENT FOR BA
DEGREE IN BUSINESS ADMINISTRATION

Submitted By: Biruk Andualem 21/2139


Melat tadesse 21/2252
Hafsa Reswan 24/4425
Emran Jelaledin 24/4424

Advisor: Naol Woldie (MBA)


APR, 2024

Addis Abeba, Ethiopia


ASSESSEMENT OF PERFORMANCE APPRAISAL SYSTEM: THE CASE STUDY OF
COMMERCIAL BANK OF ETHIOPIA, ARATEGNA BRANCH

By: Biruk Andualem 21/2139


Melat tadesse 21/2252
Hafsa Reswan 24/4425
Emran Jelaledin 24/4424
Approved BY BOARD OF EXAMINERS

DEAN, SCHOOL OF BUSINESS SIGNITURE&DATE

ADVISOR SIGNITURE&DATE

EXTERNALEXAMINER SIGNITURE&DATE

INTERNALEXAMINER SIGNITURE&DATE
Acknowledgements
I would like to express my heartfelt gratitude to my powerful God for guiding me throughout my study. I extend
my sincere thanks to my advisor, Naol Woldie (MBA) , for his invaluable guidance. I am thankful to my friends
and others who have shared their knowledge and provided valuable suggestions. Their support has been
instrumental in completing this study.

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ABSTRACT

The study is focused on performance appraisal in CBE in Addis Ababa. It will try to assess the techniques used in
the organization for performance appraisal. The type of research we are planning to conduct is descriptive
research. The population size of the organization is 45 that mean for the research purpose, this study will use
Census. The type of data will be collected to conduct the study will be both quantitative and qualitative data; the
data will be collected through questionnaires, structured interviews. The collected data will be analyzed and
presented by the help of tables and percentage. After collecting all necessary information through census, Then
the necessity data will be followed by data analysis, interpretation and presentation will be made. the researcher
will try to identify the major problems of performance appraisal system. Finally, the study will summarize and
recommended alternative of solutions to develop organizational performance of the employees.

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Table of Contents

Table of Contents
Acknowledgements.................................................................................................................................................................1
ABSTRACT................................................................................................................................................................................1
Acronyms/Abbreviation..........................................................................................................................................................4
Abstract................................................................................................................................................................................... 7
CHAPTERONE...........................................................................................................................................................................8
INTRODUCTION.......................................................................................................................................................................8
1.1. Background of the study...................................................................................................................................................8
1.2. Background of the Organization......................................................................................................................................9
1.3. Statement of the Problem.................................................................................................................................................9
1.5. Objectives of the Study..................................................................................................................................................10
1.5.1. General Objectives......................................................................................................................................................10
The study aims to examine the employee performance evaluation approach used by the Commercial Bank of Ethiopia.
........................................................................................................................................................................................... 10
1.5.2. Specific Objectives......................................................................................................................................................10
1. The study examines how the employee performance evaluation system at the Commercial Bank of Ethiopia aligns
with the bank's overall strategic goals...............................................................................................................................10
1.6. Significance of the Study...............................................................................................................................................10
1.7. Scope of the Study..........................................................................................................................................................11
1.8. Limitations of the Study.................................................................................................................................................12
1.9. Organization of the Study...............................................................................................................................................13
CHAPTERTWO........................................................................................................................................................................14
REVIEW OF RELATED LITERATURE................................................................................................................................14
2.1.1. What is Performance...................................................................................................................................................15
2.2.1 Performance Management: An Overview....................................................................................................................16
2.2.1 What is Performance Evaluation?................................................................................................................................17
2.2.1 Role of Performance Evaluation..................................................................................................................................17
2.2.1. Bias and Errors............................................................................................................................................................19
2.2.1.1. Future-Oriented....................................................................................................................................................22
2.1.1. Purpose of Employees Performance Evaluation.........................................................................................................23
2.1.8. The Performance Evaluation Process..........................................................................................................................24
2.3. Empirical Review...........................................................................................................................................................29
CHAPTERTHREE....................................................................................................................................................................31
RESEARCHDESIGNANDMETHODOLOGY........................................................................................................................31

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3.1. Research Design and Approach.....................................................................................................................................31
3.2. Source of Data................................................................................................................................................................33
3.3. Data Gathering Instruments............................................................................................................................................33
3.4. Reliability.......................................................................................................................................................................34
3.5. Method of Data Analysis................................................................................................................................................35
3.6. Ethical Considerations....................................................................................................................................................36
CHAPTERFOUR......................................................................................................................................................................37
DATAANALYSISANDINTERPRETATION.........................................................................................................................37
4.1. Response Rate....................................................................................................................................................................37
4.2. General Profile of Respondents..........................................................................................................................................37
4.2. Analysis of the Collected Data.......................................................................................................................................39
CHAPTERFIVE........................................................................................................................................................................53
FINDINGS, CONCLUSIONS AND RECOMMENDATIONS...............................................................................................53
5.2. Conclusions........................................................................................................................................................................54
5.2. Recommendations..............................................................................................................................................................55
Appendices............................................................................................................................................................................61

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Acronyms/Abbreviation

CBE: Commercial bank of Ethiopia

HR: Human resource

HRM: Human resource management

PMS: Performance management system

SPSS: Statistical Package for the Social sciences

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List of Table
Table 1 Reliability test of Variables Using Cranach’s Alpha...................................................................................35
Table 2 General Profile of Respondents...................................................................................................................39
Table 3 Respondents' Awareness regarding the Linkage between Performance Evaluation and Business Strategic
Objectives.................................................................................................................................................................41
Table 4 Respondents Opinion on Employees Performance Standard......................................................................43
Table 5 Respondents Reaction to Communicating the Performance Standards.......................................................45
Table 6 Respondents Awareness to Measure the Actual Performance..............................................................46
Table 7 Respondents Opinion on Comparison of Actual Performance with the Standards............................49
Table 8 Respondents View on Performance Evaluation Feedback....................................................................50
Table 9 Respondents reaction bout the Advantages of Taking Corrective Action...................................................52

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List of Figure

Figure 3.1 The Process of performance evaluation standard...............................................21

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Abstract

In the abstract, the researchers present a study that aimed to assess the performance
evaluation system used by the Commercial Bank of Ethiopia (CBE) in its Addis Ababa
branches. Through a combination of quantitative surveys and qualitative interviews, the study
sought to understand how the employee performance evaluation system is linked to the bank's
overall strategic objectives, whether the evaluation system follows standard processes, the
clarity and relevance of the performance standards, and the key issues with the performance
evaluation system. The findings revealed that while the organizational, departmental, and
individual goals are generally aligned, there are several areas that need improvement, such as
lack of regular feedback, poor employee understanding of the bank's strategy, insufficient
employee participation in setting performance standards, rater bias, and lack of corrective
actions. To address these gaps, the researchers propose recommendations including enhancing
employee involvement in the evaluation process, improving awareness of the evaluation
system's purpose, setting goals through mutual agreement, incorporating self-appraisal,
gathering feedback from multiple sources, providing regular feedback, setting achievable
goals, and making the evaluation criteria more objective and well-timed. The study provides
valuable insights to help the CBE strengthen its performance evaluation system and align it
more effectively with the bank's strategic priorities.

Keywords: Performance evaluation, HRM ,Performance standards,

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CHAPTERONE

INTRODUCTION

1.1. Background of the study

The introductory section provides the background and foundation for the overall study. It
covers the importance of performance evaluation as a key aspect of human resource
management (HRM). Performance evaluation is described as a process of advancing
organizational performance by systematically developing the performance of individuals and
teams. An effective performance evaluation system helps managers evaluate and measure
individual performance, align individual and strategic objectives, set clear performance
expectations, document performance for future decisions, and focus on skill development
(Armstrong, 2009).

The study emphasizes that having the right performance evaluation system is a concern for
every organization, as it is a critical component for organizational success by evaluating and
developing employee performance. Performance evaluation is defined as a continuous process
of identifying, measuring, and developing individual performance, while aligning it with the
organization's strategic goals.

The introductory section highlights the significance of performance evaluation in


organizational settings. It helps ensure employees are working towards achieving the
organization's mission and objectives. Performance evaluation sets expectations, motivates
employees, and provides a structured management process to assess organizational and
employee performance. Improving individual employee performance through an effective
evaluation system is seen as a pathway to enhancing overall organizational performance
(Macky & Johnson, 2000; Ying, 2012).

The comprehensive coverage of the background, importance, and definitions of performance


evaluation in this introductory section lays the groundwork for the rest of the study.

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1.2. Background of the Organization

The Commercial Bank of Ethiopia (CBE) has been a leading bank in the country's economic development for
over 75 years. Established in 1943, the CBE has aggressively expanded its presence nationwide and currently
has more than 1,280 branches serving over 18.8 million customers across Ethiopia. Despite stiff competition
from private commercial banks, the CBE remains the market leader in terms of assets, deposits, capital,
customer base, and branch network. As of June 30, 2018, the bank's total capital reached 565.5 billion ETB
(CBE Website).

The CBE combines a large human capital base of over 33,000 talented and committed employees, along with a
robust infrastructure that helps connect its branches and head office operations. The bank's vision is to become
a world-class commercial bank, and its mission is to best serve stakeholders' needs through enhanced financial
intermediation, supporting national development priorities, and deploying highly motivated, skilled, and
disciplined employees as well as state-of-the-art technology. The CBE strongly believes that winning public
confidence is the basis of its success (CBE Website).

The core values of the CBE include integrity, customer satisfaction, employee satisfaction, being a learning
organization, teamwork and collaboration, public trust, value for money, decentralization, and corporate
citizenship (CBE Website).

1.3. Statement of the Problem


In a research study on the assessment of the employee performance evaluation system at the
Commercial Bank of Ethiopia (CBE), the authors highlight the importance of performance
evaluation as a common practice in most organizations. Effective performance evaluation is
essential for driving better performance at both the individual employee and organizational
levels. The study emphasizes that satisfied employees play a crucial role in creating improved
organizational performance (Karimi, Malik & Hussain, 2011).

However, the researchers note that certain aspects of the performance evaluation system at the
CBE have not been thoroughly examined in prior studies. Specifically, the study aims to

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assess the level of staff participation in setting performance standards, the clarity and fairness
of the performance evaluation system, and the alignment between employee performance
standards and the bank's strategic objectives. Previous research on the CBE has primarily
focused on the general level of performance evaluation implementation, the challenges faced,
and the awareness among managers and employees. This study seeks to address these gaps in
the existing literature by conducting a comprehensive assessment of the problems in the CBE's
employee performance evaluation system.

1.4. Research Questions


1. How does the employee performance evaluation system align with the bank's overall strategic goals?
2. To what degree does the CBE's employee performance evaluation process adhere to standard best
practices?
3. How clear and relevant are the performance standards used in the evaluation process?
4. What are the identified problems or issues with the CBE's performance evaluation system?

1.5. Objectives of the Study

1.5.1. General Objectives


The study aims to examine the employee performance evaluation approach used by the Commercial Bank of
Ethiopia.

1.5.2. Specific Objectives


1. The study examines how the employee performance evaluation system at the Commercial Bank of Ethiopia
aligns with the bank's overall strategic goals.
2. The research looks at the extent to which the CBE's employee performance evaluation process adheres to
standard best practices.
3. The study evaluates the clarity and relevance of the performance standards used in the CBE's evaluation
process.
4. The research aims to uncover and assess the specific problems or issues identified with the performance
evaluation system at the Commercial Bank of Ethiopia.

1.6. Significance of the Study

The significance of this study on the employee performance evaluation system at the
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Commercial Bank of Ethiopia (CBE) is multifaceted. Firstly, the bank has made substantial
investments in implementing this performance evaluation system, so the research aims to
provide valuable insights by identifying both the areas that need improvement as well as the
aspects the bank is currently handling well. The findings of the study are expected to make a
meaningful contribution to the existing body of literature on this topic, serving as an
additional reference source for academics and practitioners alike.

Importantly, enhancing the effectiveness of the employee performance evaluation system


could have a positive impact on customer satisfaction by driving improvements in overall
employee performance. The research can also act as a springboard for other researchers to
conduct more detailed, focused studies on the specific issues and challenges faced by the CBE
in its performance management processes. This, in turn, can help the bank take appropriate
actions to strengthen its efforts towards building a stronger performance-oriented culture and
introduce new directives as needed.

The significance of this study lies in its potential to provide the CBE with actionable insights
to optimize its performance evaluation system, add value to the existing knowledge base, and
ultimately lead to improved customer experiences through enhanced employee performance.
The findings could prove invaluable in helping the bank further refine and enhance its
approach to performance management, ultimately supporting its strategic objectives.

1.7. Scope of the Study

The scope of this research is focused specifically on assessing the employee performance
evaluation system at the Commercial Bank of Ethiopia (CBE). While performance evaluation
can encompass various levels, including organizational, team, and individual employee
performance, this study narrows its attention to examining the processes and mechanisms used
to evaluate the performance of individual employees.

The research was conducted among the permanent clerical staff and management personnel
across a sample of 10 CBE branches located in Addis Ababa. Due to constraints around time
and financial resources, the researcher was limited to studying the performance evaluation
system within this specific geographic area, covering just a subset of the bank's branch
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network.

In summary, the scope of the study is delimited to an in-depth examination of the individual
employee performance evaluation system at the CBE, based on data collected from a selected
sample of Addis Ababa-based branch operations and management. The research does not
extend to evaluating team or organizational performance measurement at the bank. The
restricted geographic coverage also represents a limitation in the scope of this particular study.

1.8. Limitations of the Study

The limitations of this study on the employee performance evaluation system at the
Commercial Bank of Ethiopia (CBE) are notable and important to acknowledge. Firstly, the
research was confined to only addressing the perspectives and experiences of employees and
managers from a selected set of CBE branches, rather than taking a bank-wide approach. This
restricted sample may not fully capture the nuances and variations in the performance
evaluation practices across the organization's entire branch network.

Additionally, the researcher was constrained by the time allotted to complete the study, which
was deemed insufficient to conduct a truly thorough and comprehensive investigation of the
topic. This time pressure necessitated the researcher to limit the size of the sample selected for
the study. Furthermore, the geographic scope of the research was narrowed down to only the
branches located in Addis Ababa, the capital city. This focus on a specific regional area may
affect the ability to generalize the findings to the performance evaluation processes employed
across CBE's operations in other parts of the country.

Collectively, these limitations around sample size, time constraints, and geographic focus
represent significant boundaries on the scope and coverage of this particular study. The
researcher recognizes that these factors could potentially limit the ability to extrapolate the
study's findings to fully reflect the employee performance evaluation system used throughout
the Commercial Bank of Ethiopia as a whole.

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1.9. Organization of the Study

This study is organized into five chapters. The first chapter is an introduction part and
itcontains background of the study, statement of the problem, research questions, and
objectivesofthestudy,significanceofthestudy,scopeofthestudy,limitationsofthestudy
andorganization of the study. The second chapter is the review of related literature, and the
thirdchaptercontainsresearchmethods,andthefourthchaptercontainsDataPresentation,Analysis
andInterpretation. Finally, the fifth chapter contains Summery, Conclusion
andrecommendation.

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CHAPTERTWO

REVIEW OF RELATED LITERATURE

The theoretical literature review likely examines the underlying theories, concepts, and
frameworks that form the foundation for understanding employee performance evaluation
systems. This could include discussing theories related to performance management,
motivation, organizational behavior, and human resource management.

The empirical literature review, on the other hand, would focus on summarizing and
synthesizing findings from previous studies and research that have been conducted on the
practical implementation and effectiveness of performance evaluation systems, particularly in
the banking or organizational context.

By incorporating both the theoretical underpinnings as well as the empirical evidence from
prior research, the literature review chapter provides a comprehensive overview of the current
state of knowledge on the topic. This helps establish the intellectual basis and contextual
background for the current study being conducted on the employee performance evaluation
system at the Commercial Bank of Ethiopia.

The inclusion of both theoretical and empirical literature components is a common and
effective approach for a literature review section in academic research. This structure allows
the researcher to situate the current study within the broader academic discourse while also
highlighting relevant practical insights from previous empirical investigations.
2.1. Theoretical Literature

The theoretical literature review section of this study appears to provide a comprehensive
overview of the core concepts and frameworks underpinning employee performance
evaluation. The review delves into the foundational aspects of performance and performance
management, establishing a solid theoretical grounding for the research.

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Specifically, the theoretical literature examines the multifaceted nature of performance, the role
and importance of performance evaluation, and the potential biases and errors that can arise in
such evaluation processes. It also explores the various techniques and methods employed for
performance appraisal, as well as the overarching purpose and process of evaluating employee
performance. Crucially, the review also covers the key requirements for developing an
effective performance appraisal system and examines employees' perceptions and experiences
regarding performance evaluation.

By thoroughly covering these theoretical underpinnings, the literature review chapter sets the
stage for the empirical investigation that follows. This comprehensive theoretical foundation
helps situate the current study within the broader academic discourse on performance
management, enabling the researcher to build upon established concepts and frameworks in
their exploration of the employee performance evaluation system at the Commercial Bank of
Ethiopia. The structured approach to the theoretical literature review demonstrates a strong
grasp of the conceptual aspects underlying the research topic.

2.1.1. What is Performance

The concept of performance management encompasses both the accomplishment and


completion of tasks, as well as the process and manner in which the work is carried out.
Performance refers not only to the outputs or outcomes achieved, but also to the behaviors and
actions exhibited in the process of getting the work done.

Performance can be viewed as the behaviors and actions through which organizations, teams,
and individuals execute their work. Job performance is a function of both what the person
accomplishes (the results) and how the person goes about doing the job (the behaviors).

As highlighted by Grote (2002), for an organization to be successful, both the behaviors and
the results are important. The definitions provided focus on this dual aspect of performance,
emphasizing that a comprehensive view of performance must encompass both the behaviors
and the outcomes.
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In essence, performance entails either the behaviors exhibited by the performer and the actual
results or outputs achieved. The behaviors are the tangible actions that transform performance
from an abstract concept into practical implementation.

When managing the performance of teams and individuals, both the inputs (behaviors) and the
outputs (results) need to be considered holistically. This integrated perspective on performance,
accounting for both the process and the outcomes, is crucial for effective performance
management.

2.2.1 Performance Management: An Overview

Performance management is an ongoing, strategic process that aims to align the performance of
individual employees and teams with the overall goals and objectives of the organization. This
involves continuously identifying, measuring, and developing the performance of personnel to
enable them to carry out their roles as effectively as possible and meet or exceed established
targets (Smithers & London, 2009).

The performance management system can be viewed as a flexible, collaborative framework


that is based on the principles of management through agreement and consensus, rather than
top-down command and control. The success of this system is critical for the organization's
continued viability, as employees' attitudes and perceptions towards it can significantly impact
the firm's profitability (Inyang, 2008).

The fundamental purpose of performance management is to achieve positive outcomes for both
the employees and the organization as a whole. This is facilitated through a process that
provides clear, supportive feedback and recognition to all contributors (Weiss & Hurtle, 1997;
Armstrong, 2009).

When implementing an effective performance management system, key steps include

16
developing a robust communication plan, establishing an appeals process, training raters, and
pilot testing the system to ensure it captures all necessary details (Aguinis, 2007; Ayanyinka &
Emmanuel, 2013). Given the high level of engagement and commitment required from
personnel, studying the performance management practices of an organization like the
Commercial Bank of Ethiopia is crucial, as employees' perceptions can greatly influence
overall organizational performance (Furnham, 2004; Ayanyinka & Emmanuel, 2013).

2.2.1 What is Performance Evaluation?

Organizations use a process called performance evaluation or appraisal to assess and judge the
work performance of their employees based on predetermined standards (Manjunath, 2015).
The primary purpose of these evaluations is to assist managers in effectively staffing the
company, utilizing human resources, and ultimately improving organizational productivity
(Manjunath, 2015). When conducted properly, performance appraisals achieve this by
providing employees with feedback to enhance their work performance, setting goals for them,
and helping managers assess the effectiveness of their subordinates - information that informs
critical HR decisions such as hiring, promotions, training, and compensation (Lansbury, 1988
as cited in Seniwoliba, 2014). Performance evaluation can be defined as a formalized,
structured interaction between a subordinate and their supervisor, occurring annually or semi-
annually, to review the subordinate's job performance and identify areas for improvement and
skill development (Deepa & Kuppusamy, 2014). This systematic process of gathering,
analyzing, and recording information about an employee's worth, performance, and capabilities
ultimately supports the employee's further growth and advancement within the organization
(Khan, 2013).

2.2.1 Role of Performance Evaluation


Effective performance appraisal within an organization or company serves to improve the
overall effectiveness of the entity (McGregor, 1966). McGregor (1966) identified three primary
functional areas of performance appraisal systems: administrative, informative, and
motivational. Appraisals serve an administrative role by facilitating orderly salary and reward
determinations, as well as delegating authority and responsibility to the most capable

17
individuals. The informative function is fulfilled when the appraisal system provides managers
and employees with data on individual strengths and weaknesses. Finally, the motivational role
entails creating a learning experience that encourages workers to improve their performance.
When used effectively, performance appraisals help employees and managers establish goals
for the period before the next evaluation (Maddux, 1993).

Appraisees, appraisers (managers), and the company all benefit from effective performance
appraisals (Maddux, 1993). Appraisees gain clarity on expectations, can set goals, and better
understand their strengths and weaknesses. Appraisals also provide a constructive forum for
feedback and allow workers to provide input to their managers. Managers, in turn, can
effectively identify performance trends, compare subordinates, and use the information to
assist employees in planning goals and tailoring job responsibilities (Maddux, 1993). For the
organization, the appraisal process enables improved communication, greater staff motivation,
and a more informed and productive workforce, which leads to better decision-making and
comprehensive goal achievement (Brown, 1988).

Effective performance appraisal systems are pragmatic, relevant, and uniform, which helps
ensure the system is easily understood by employees and effectively implemented by managers
(Brown, 1988). Systems that are not specifically relevant to the job may result in wasted time
and resources, so successful appraisal programs identify and evaluate only the critical
behaviors that contribute to job success (Brown, 1988; Maddux, 1993).

Uniformity of the appraisal structure is vital as it ensures all employees are evaluated on a
standardized scale. Non-uniform appraisals are less effective because the criteria for success or
failure become arbitrary and meaningless (Brown, 1988). Uniform appraisals also allow a
company to systematically compare the appraisals of different employees.

The specific criteria measured in a performance appraisal should be selected to encourage the
achievement of comprehensive corporate objectives. This is done by determining the exact role
of each job in accomplishing company goals and identifying the critical behaviors and results
for success in each position (Maddux, 1993). Evaluators should focus on objectively measuring

18
productivity and quality to avoid biased appraisals.

Managers typically select an employee's immediate supervisor to provide the initial


assessment, which is then reviewed by a higher-level manager or the personnel department.
Other potential evaluators include coworkers, subordinates, customers, or the employees
themselves (Maddux, 1993).

The most popular rating techniques used in performance appraisals include rating, ranking,
critical incidents, and techniques using multiple or miscellaneous criteria. Effective
communication of assessment results to employees is important, often involving feedback
methods like written follow-ups, goal setting, and allowing employee input (Brown, 1988;
Maddux, 1993).

The performance appraisal process generally consists of three steps: evaluation and job
analysis, the appraisal interview, and the post-appraisal interview. The first step involves both
the appraiser and appraisee preparing by considering job performance, responsibilities, goals,
and concerns. The appraisal interview is an exchange where both parties share their
perceptions, and the post-appraisal interview addresses salary and promotion decisions
(Maddux, 1993).

2.2.1. Bias and Errors

Even when a performance evaluation program is thoughtfully structured, its true effectiveness
can still be undermined by the improper use of subjective measures rather than objective ones.
Objective measures are readily incorporated into appraisals because they are quantifiable and
verifiable - things like the number of cars a fast-food worker can serve at the drive-through in a
given shift, or the error rates, complaint volumes, and other tangible metrics that provide clear-
cut gauges of performance (Rao & Rani, 2014). In contrast, subjective measures rely heavily
on the personal opinions and perceptions of the evaluator, such as assessing a worker's
courteousness or attitude. These types of subjective assessments open the door to bias,
prejudice, and other distortions that can skew the accuracy of performance reviews (Rao &
Rani, 2014).
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Organizations make efforts to train appraisers on recognizing and mitigating common forms of
bias, such as cross-cultural expectations, the tendency to focus on recent events rather than
long-term patterns, the "halo effect" of letting personal opinions color evaluations, and the
inclination towards leniency or strictness (Lunenburg, 2012). However, these biases can be
deeply ingrained, and even the most well-intentioned managers may struggle to overcome
them. Additional flaws can creep in through the execution of the appraisal process itself, as
managers may feel pressure to adjust ratings to fit departmental budgets or pursue personal
agendas (Lunenburg, 2012). Ultimately, organizations must be vigilant in monitoring the
effectiveness of their performance review systems and addressing the root causes of any issues
that arise (Lunenburg, 2012).

2.2.1. Performance Evaluation Techniques


Performance appraisal techniques can be classified not only by the four general categories
previously discussed, but also by their temporal orientation - whether they are past-oriented or
future-oriented (Aggarwal & Thakur, 2013; Shaout & Yousif, 2014). Past-oriented techniques
focus on assessing behaviors and actions that have already occurred, with the primary goal of
providing employees with feedback about their prior performance to help guide them towards
greater success in the future. Examples of past-oriented approaches include rating scales,
checklists, and critical incident evaluation, all of which look back at the employee's previous
actions and results to identify strengths, weaknesses, and areas for improvement (Aggarwal &
Thakur, 2013; Shaout & Yousif, 2014). In contrast, future-oriented appraisal techniques
emphasize assessing the employee's potential for future achievement, with an emphasis on
setting targets and goals for both short-term and long-term performance. Behavioral-based
rating scales (BARSs) and forced-choice appraisals are examples of these forward-looking
methods that analyze the employee's current skills, competencies, and abilities to determine
development needs and establish objectives for upcoming performance (Aggarwal & Thakur,
2013; Shaout & Yousif, 2014). The key distinction is that past-oriented approaches are
centered on reviewing and providing feedback on prior behavior, while future-oriented
techniques are more focused on evaluating potential and setting targets for future growth and
performance (Aggarwal & Thakur, 2013; Shaout & Yousif, 2014).

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2.2.1.1. Past-Oriented
Some of the traditional performance review methods like rating scales and checklists remain
popular today, despite their clear shortcomings. These approaches involve a manager
subjectively assessing an employee's performance, scoring them on factors like dependability,
attitude, and attendance (Aggarwal & Thakur, 2013). The rater simply checks a box to indicate
if the employee is "excellent," "good," "fair," or "poor" on each factor, and these scores are
totaled to determine the employee's ranking.

For checklists, the manager just marks statements they believe describe the employee, like
"works well with others." The main advantages of these techniques are that they're cheap and
easy to implement. However, they have significant drawbacks - they're highly vulnerable to
bias, often ignore key job-related information, provide limited feedback opportunities, and fail
to set clear standards for future success. Rating scales in particular can also open companies up
to legal issues (Aggarwal & Thakur, 2013).

A fairer approach is behaviorally anchored rating scales (BARSs), which identify job-specific
activities and describe the most and least effective behaviors for succeeding in that role. The
rater observes the employee and records their behavior on the BARS scale. This is similar to
checklists, but the statements allow the rater to better differentiate between behavior,
performance, and results, making BARSs more useful for goal-setting (Aggarwal & Thakur,
2013). The advantages are that BARSs are highly job-specific, easy to use, and less biased.
However, they can be costly and time-consuming to develop.

Another option is forced-choice appraisals, where the rater must choose between paired
positive and negative statements about the employee, like "Always on Time" vs "Never on
Time" (Khan, 2013; Khanna & Sharma, 2014). This helps generate an accurate overall
representation of the employee's abilities. Forced-choice appraisals are simple and inexpensive,
but can lack job-relatedness and feedback opportunities.

Critical incident evaluation has the rater document specific examples of the employee's good
and bad job-related behaviors. This provides valuable feedback, and is less susceptible to bias.

21
But it requires ongoing, close observation and is not easily standardized (Shaout & Yousif,
2014).

Finally, field review appraisals involve HR professionals assisting managers by interviewing


the employee, coworkers, and the manager, then preparing an evaluation. This improves
reliability and reduces bias, but is costly and impractical for most companies, only used in
special cases (Aggarwal & Thakur, 2013).

2.2.1.1. Future-Oriented

One of the most popular future-oriented performance appraisal techniques is the management
by objectives (MBO) approach. With MBO, managers and employees work collaboratively to
set meaningful goals (Khanna & Sharma, 2014). This goal-oriented process aims to foster
continuous improvement by having employees actively participate in setting their objectives,
receiving feedback, and making corrections as needed (Khanna & Sharma, 2014).

When employees have a hand in defining their goals, they're naturally more motivated to
accomplish them and are also more receptive to any constructive criticism that arises from
measuring their performance against those objectives (Khanna & Sharma, 2014). Of course,
MBO requires that the goals be specific, measurable, and time-bound for it to be truly effective
(Khanna & Sharma, 2014).

While MBO was hugely popular in the late 20th century, it's faced some criticism over the
years for its emphasis on objectively measured behaviors like quantity of output, rather than
more subjective quality metrics (Khanna & Sharma, 2014). This can potentially lead to
employee frustration or subpar performance, if the evaluation feels overly focused on the
numbers rather than the big picture.

Another future-oriented approach is the assessment center, which is a more complex, multi-
faceted evaluation typically used for managerial or executive candidates (Shaout & Yousif,
2014). This process involves a battery of interviews, tests, and exercises, both individual and
group-based, to assess the employee's future leadership potential and identify their strengths
22
and weaknesses (Shaout & Yousif, 2014).

While assessment centers can be effective, they are also quite costly and have been criticized
for potential bias and lack of direct job relevance (Shaout & Yousif, 2014). But many
organizations still find value in this comprehensive, multi-rater approach to identifying high-
potential talent.

Psychological testing is a less elaborate future-oriented technique, relying on interviews,


assessments of intellectual/emotional/work-related traits, and evaluations by psychologists and
supervisors (Khan, 2013; Khanna & Sharma, 2014). The results are documented in a report that
may or may not be shared with the employee (Khan, 2013; Khanna & Sharma, 2014). This
process is time-consuming and expensive, and its success hinges greatly on the psychologist's
skills (Khan, 2013; Khanna & Sharma, 2014).

Self-appraisal is another future-oriented approach, where employees evaluate their own


performance (Khanna & Sharma, 2014). This can help workers set personal goals and identify
areas for improvement, while also providing valuable feedback for managers (Khanna &
Sharma, 2014). The advantage is that employees tend to be less defensive about critiques they
give themselves, making self-improvement more likely (Khanna & Sharma, 2014).

In practice, many organizations employ a hybrid approach, combining various future-oriented


and past-oriented techniques to get a well-rounded assessment of employee performance and
potential (King, as cited in Khanna & Sharma, 2014). This enables them to measure both
behaviors and results, and establish meaningful goals to enhance worker motivation and
productivity.

2.1.1. Purpose of Employees Performance Evaluation

Performance appraisals are absolutely crucial tools for organizations, as they provide
invaluable information that informs key personnel decisions like promotions and merit-based
pay increases (Obisi, 2011). Experts agree that performance reviews typically serve either
administrative or developmental purposes (Gomez-Mejia et al., 2012).

23
On the administrative side, the data gathered during the appraisal process is used as the basis
for decisions about an employee's work conditions, such as their job status, benefits, and
compensation (Behn, 2000, as cited in Mamimini et al., 2015). As one scholar puts it, "One of
the most common uses of performance appraisal is for making administrative decisions relating
to promotions, fringes, layoff, and merit pay increases" (Rahim, 2012, p. 386).

But performance reviews also play a vital developmental role (Kondrasuk, 2011, as cited in
Mamimini et al., 2015). Providing employees with candid feedback, coaching on effective
work behaviors, and recommendations for training and other learning opportunities - all based
on their appraisal results - helps improve their performance and strengthen their job skills
(Gomez-Mejia et al., 2012). Experts note that highlighting areas for improvement is a key way
performance reviews can guide employees toward growth and development (Wangithi &
Muceke, 2012).

Ultimately, the performance appraisal process is a critical management tool that serves both
organizational and individual needs. When executed thoughtfully, it gives leaders the insights
they require to make fair, strategic personnel decisions, while also empowering employees to
enhance their skills and contributions.

2.1.8. The Performance Evaluation Process

Establish Performance Standards and Expectations

The performance review process begins with the critical step of establishing clear performance
standards and expectations for the employee (Manjunath, 2015). The essence of this upfront
work is to make it easy to identify the specific outputs, skills, and accomplishments that will be
assessed (Manjunath, 2015).

This step is all about setting the concrete criteria that will guide the manager's evaluation of
24
whether the employee's performance is satisfactory, and the degree to which they are
contributing to the organization's overall goals and objectives (Manjunath, 2015).

Taking the time to carefully define these standards serves an important purpose - it provides a
shared understanding between the manager and employee about the benchmarks against which
the employee's work will be measured (Manjunath, 2015). This transparency helps ensure the
evaluation process is fair and objective.

When both parties are aligned on the specific performance factors being assessed, it lays the
groundwork for a more meaningful, constructive dialogue during the review (Manjunath,
2015). The employee understands exactly what is expected of them, and the manager has clear
guidelines to follow in providing balanced, actionable feedback.

Establishing these standards is a crucial first step that sets the tone for the entire performance
appraisal to unfold in a collaborative, transparent manner (Manjunath, 2015). It's an investment
that pays dividends throughout the review process and beyond.

 Communicate Performance Expectations of employees

Before the performance review process can really begin, it's essential that managers and
employees sit down together to clearly establish the performance standards and expectations
(Manjunath, 2015). Past experience has shown that neglecting this crucial upfront step can
seriously undermine the entire appraisal, leading to confusion and frustration on both sides
(Manjunath, 2015).

The transfer of information from manager to employee is not enough - true communication
only happens when the employee has not just received the information, but fully understood it
(Manjunath, 2015). Managers must go beyond simply delivering the standards, and instead
engage in an open dialogue to ensure the employee is completely aligned on what is expected
of them (Manjunath, 2015).

25
Getting direct feedback from the employee on the communicated standards does a great way to
verify this mutual understand (Manjunath, 2015). When employees are aware of and in
agreement with the criteria by which their work will be evaluated, it helps create a foundation
of trust and transparency (Manjunath, 2015).

This collaborative, two-way discussion sets the stage for a more effective and productive
performance review process overall (Manjunath, 2015). It lays the groundwork for the entire
appraisal to unfold as a meaningful experience, where both manager and employee work
together toward shared goals and expectations (Manjunath, 2015).

 Measuring Actual Performance

When evaluating employee performance, managers gather information from a variety of


reliable sources to get a well-rounded, objective assessment (Manjunath, 2015). This can
include directly observing the employee's work, reviewing statistical reports, listening to oral
feedback, and examining written records (Manjunath, 2015).

The goal is to base the measurement of performance on clear facts and evidence, rather than
subjective feelings or biases (Manjunath, 2015). This objectivity is crucial, because what is
being measured is far more important to the overall evaluation process than how it is measured
(Manjunath, 2015).

Managers must be diligent about collecting data from multiple credible channels to ensure their
assessment of the employee's actual work output and behaviors is as accurate and unbiased as
possible (Manjunath, 2015). This solid foundation of facts and figures will then allow for a
fair, constructive performance review discussion (Manjunath, 2015).

While the "how" of the measurement process is important, the "what" - the actual metrics,
observations, and evidence gathered - carries the most weight in determining the employee's
strengths, weaknesses, and overall standing (Manjunath, 2015). Maintaining this objective,
data-driven approach is essential for performance reviews to be meaningful and impactful.

26
 Compare Actual Performance with Standards
At this stage of the performance review process, the employee's actual work performance is
carefully compared against the predetermined standards (Manjunath, 2015). This comparison
can shed light on the gap between the expected benchmark and the employee's real-world
outcomes (Manjunath, 2015).

Uncovering this deviation is a crucial part of the appraisal, as it will allow the evaluator to have
a constructive, in-depth discussion with the concerned employee (Manjunath, 2015). The goal
is to really dive into the details and provide the employee with a clear, well-rounded
understanding of their strengths, weaknesses, and areas needing improvement (Manjunath,
2015).

This step is pivotal, as the insights gleaned from the comparison will form the foundation for
the upcoming feedback session (Manjunath, 2015). The evaluator must approach this analysis
thoughtfully, preparing to have an open, empathetic dialogue with the employee about their
performance (Manjunath, 2015).

Handling this phase with care and sensitivity will help ensure the performance review leads to
meaningful growth and development for the employee, rather than becoming a source of
frustration or defensiveness (Manjunath, 2015).

 Discuss the Appraisal with the Employee

Communicating and discussing the results of the performance appraisal with employees is a
critical next step in the process, though it can also be one of the trickiest tasks for managers
(Manjunath, 2015). Presenting an accurate and fair assessment to employees and getting them
to accept it constructively is a delicate balancing act (Manjunath, 2015).

When done well, the appraisal discussion allows employees to understand both their strengths
and areas for improvement (Manjunath, 2015). This feedback can have a significant impact,
positive or negative, on their future performance - it all depends on how the manager
approaches the conversation (Manjunath, 2015).
27
Managers have to walk a fine line, delivering an honest evaluation while also being sensitive
and helping the employee see it as an opportunity for growth, not a personal attack (Manjunath,
2015). It requires strong interpersonal skills and empathy to navigate these performance review
discussions in a constructive manner (Manjunath, 2015).

The final step in the performance review process involves taking corrective action to address
identified areas for improvement (Manjunath, 2015). Managers first pinpoint the specific
performance issues that need to be addressed, and then implement measures to correct or
enhance employee performance (Manjunath, 2015). There are two main types of corrective
actions that can be taken - immediate solutions that focus on quickly resolving the immediate
symptoms, and more fundamental actions that delve deeper into the underlying causes to make
permanent adjustments (Manjunath, 2015). While the more thorough basic approach may be
preferable, managers often opt for the quicker "put out fires" immediate actions, as they
provide faster remedies (Manjunath, 2015). Common corrective methods utilized include
training, coaching, and counseling employees to help improve their performance (Manjunath,
2015).

28
Source: Adopted from Manjunath (2015)

2.3. Empirical Review

The performance appraisal system has been the focus of several studies in various organizational contexts. Migiro
and Taderera (2011) empirically evaluated the performance appraisal system at the Bank of Botswana, using a
stratified sampling method. The study aimed to identify the purposes of performance appraisal, the effectiveness
of the performance appraisal system, and the challenges of the existing system. The study concluded that several
issues need to be addressed, including regular training for both employees and evaluators, transparency in the
implementation of the appraisal system, provision of continuous feedback to employees, and reduction of
inconsistency in the system (Migiro & Taderera, 2011).

29
Similarly, Mishra (2013) studied the Employee Appraisal System in the Hong Kong and Shanghai Banking
Corporation and concluded that the process of performance appraisal should be a continuous activity conducted
on a regular basis. The study also suggested that performance appraisal plays a vital role in achieving the
predetermined goals of the organization through the efforts of HR, which ensures the accomplishment of tasks by
judging the behavior of employees and their overall performance (Mishra, 2013).

Furthermore, Atta-Quartey (2015) investigated the staff's perception on the effectiveness of the annual assessment
system and examined the motivation status of staff after assessment at the University of Cape Coast. The study
concluded that the current appraisal system of the university is ineffective, and performance appraisal, as well as
performance management at the University of Cape Coast, lacks policy direction. The study recommended that
the Division of Human Resources should review the appraisal system and introduce a new appraisal system, while
also arranging training for supervisors to provide them with appropriate assessment skills (Atta-Quartey, 2015).

30
CHAPTERTHREE

RESEARCHDESIGNANDMETHODOLOGY

The research design and methodology section is a critical component of any research study, as
it outlines the overall approach, techniques, and procedures that will be used to carry out the
investigation. This includes details on the research approach (qualitative, quantitative, or mixed
methods), the specific data collection methods (surveys, interviews, experiments, etc.), the
sampling strategy and sample size, the sources of data (primary or secondary), the
questionnaire design process, and the ethical considerations that will be addressed. Careful
planning and execution of these methodological elements is essential for producing reliable,
valid, and ethical research findings. The research design lays the foundation for how the study
was conducted; ensuring that the data collected can adequately answer the research questions
posed.

3.1. Research Design and Approach

For this research, the researcher decided to go with a descriptive research design to really
assess the performance evaluation system in depth. The researcher felt that a combination of
both qualitative and quantitative approaches would give the most well-rounded understanding
of the topic.

In terms of data collection, the researcher developed a questionnaire that used a 5-point Likert
scale - you know, the one that ranges from "Strongly Agree" to "Strongly Disagree." This
allowed the researcher to get quantifiable responses from a wider pool of participants. But the
researcher also conducted interviews with a few key management members to get some more
qualitative, in-depth insights.

Once the researcher had gathered all that data, they organized it into tables. The researcher
found that presenting the information in this structured format really helped to give meaning
and clarity to the findings. It allowed the researcher to identify patterns and draw out the key
takeaways from the research.

31
The researcher felt that this multi-faceted methodological approach was crucial for delivering a
comprehensive assessment of the performance evaluation system. By blending the quantitative
survey data with the qualitative interview findings, the researcher was able to develop a rich,
nuanced understanding of the topic. And the visual tables helped the researcher to
communicate those insights in a clear, compelling way.

The research study utilized a carefully designed sampling approach to ensure the data collected
was representative of the target population. The researcher focused the study on 10 branches of
the organization located within Addis Ababa city, as this was the most convenient and
accessible area for data collection.

In total, these 10 branches employed 415 clerical staff. However, rather than attempting to
survey every single employee, the researcher applied a calculation formula to determine the
optimal sample size. Using the Kish Leslie (1965) formula, and aiming for a 5% margin of
error, the ideal sample size was calculated to be 204 respondents.

To select these 204 participants, the researcher employed a stratified sampling technique. They
recognized that the employee roles varied across the branches, so they wanted to ensure the
sample was representative of this diversity. After classifying the staff into relevant strata based
on their positions, the researcher was able to apply proportional sampling to identify the
appropriate mix of respondents from each branch.

The formula used was: Sample = (number of employees from each branch / total population) x
204. This ensured the distribution of participants mirrored the actual makeup of the workforce
across the 10 branch locations.

By thoughtfully designing this sampling methodology, the researcher was confident the data
collected would be high-quality and representative of the broader population. The convenience-
based selection of branches within Addis Ababa, combined with the structured, proportional
sampling approach, allowed the researcher to efficiently and effectively gather the necessary
information to support the goals of the study.

32
3.2. Source of Data

In conducting this study, the researcher drew upon both primary and secondary sources of
information to gather the necessary data and insights. On the primary data front, the researcher
took a hands-on approach, directly engaging with the key stakeholders at the heart of the
investigation. Structured questionnaires, featuring a blend of closed-ended and open-ended
questions, were carefully distributed to elicit first-hand responses and perspectives from the
relevant parties. Additionally, the researcher conducted unstructured interviews, providing
opportunities for more in-depth, contextual discussions.

This primary data collection allowed the researcher to gain direct, up-to-the-moment insights
from the individuals and entities most closely involved with the research subject matter. To
complement the primary sources, the researcher also turned to a rich array of secondary
sources. These included scholarly journal articles, reference books, the organization's own
performance appraisal manuals, and the company's annual reports.

By tapping into this broader ecosystem of information, the researcher was able to situate the
primary data within a larger context, drawing upon established research, organizational
records, and industry knowledge. This dual-pronged approach, leveraging both primary and
secondary sources, enabled the researcher to develop a well-rounded, multi-faceted
understanding of the topic at hand.

The judicious use of these diverse information sources, from firsthand accounts to published
materials, lent depth, nuance, and rigor to the overall research process. This comprehensive
data-gathering strategy was instrumental in helping the researcher achieve the objectives of the
study.

3.3. Data Gathering Instruments

To gather the necessary information for this study, the researcher utilized a multi-pronged
approach, drawing from both primary and secondary sources.

33
On the primary data front, the researcher collected responses directly from employees through
the use of carefully constructed questionnaires. This allowed them to gain first-hand insights
and perspectives from the key stakeholders at the heart of the research topic.

The questionnaire data, which took the form of ordinal measurements, was then meticulously
coded and analyzed using the powerful SPSS software package. This rigorous quantitative
analysis enabled the researcher to identify patterns, trends, and relationships within the
employee-provided information.

In addition to the closed-ended questionnaire items, the researcher also incorporated open-
ended questions and conducted interviews. This qualitative data was subsequently analyzed
through a comprehensive content analysis, allowing the researcher to uncover rich contextual
details and nuanced understandings.

To complement the primary data collection, the researcher also extensively reviewed secondary
sources. This included delving into relevant books, research articles, internet resources, and
previous scholarly findings related to the study's subject matter.

By drawing upon this diverse array of primary and secondary sources, the researcher was able
to develop a well-rounded, multi-faceted understanding of the key concepts, issues, and ideas
central to the investigation. The judicious use of both quantitative and qualitative methods,
supported by a thorough review of the existing literature, ensures a robust and well-grounded
research approach.

3.4. Reliability

The independent variables demonstrated "good" to "acceptable" internal consistency, with an


overall average Cronbach's alpha of 0.890, indicating the questionnaire items reliably measured
the constructs.

34
Table 1 Reliability test of Variables Using Cranach’s Alpha

1 Business strategic objectives .845 .843 4 Good

2 Employees Performance Standard .817 .832 5 Good

3 Communicating the Standards .885 .808 3 Good

4 Measure the actual performance .835 .839 5 Good

5 Compare the actual performance .739 .704 3 Acceptable


with the standards
6 Providing feed back .789 .735 4 Acceptable

7 Taking corrective action .836 .839 3 Good

Total 27

Source: own survey, 2024

3.5. Method of Data Analysis

For the qualitative data collected through the interviews and open-ended questionnaire items, the
researcher used a content analysis approach to examine the responses in-depth and contextually.
This involved carefully summarizing the key themes and ideas based on their similarities and
patterns.

The researcher didn't just want to take the responses at face value - they wanted to really dig
into the underlying meanings and insights. By conducting this qualitative analysis, the
researcher was able to synthesize the findings and draw out the core substance and takeaways
from the study. As for the quantitative data gathered through the 5-point Likert scale questions,
the researcher turned to IBM SPSS Statistics software version 20 to help with the analysis.
They used descriptive statistics like frequencies and percentages to paint a clear picture of the
numerical results. Organizing the quantitative data into well-structured tables was crucial for
the researcher. It allowed them to present the results in a crisp, easy-to-digest format. From
there, the researcher was able to carefully analyze and interpret the patterns and trends
highlighted by the tabulated findings.

35
By blending the qualitative and quantitative analysis approaches, the researcher was able to
develop a rich, multi-faceted understanding of the research topic. The contextual insights from
the content analysis complemented the statistical overview provided by the descriptive
analytics. This comprehensive analytical process was key to ensuring the researcher could
deliver meaningful, well-rounded conclusions

3.6. Ethical Considerations

When it came to the ethical dimensions of this research project, the researcher took great care
to protect the confidentiality and privacy of all involved. They understood that tapping into the
personal information and company documents of the participants was a sensitive matter, so
they made ironclad guarantees that everything would be kept strictly confidential.

The researcher assured all respondents that their individual identities and any proprietary
organizational materials would be safeguarded at all times. The data collected would only be
used for the purposes of this academic research study - nothing else.

Maintaining the trust and comfort of the participants was of the utmost importance to the
researcher. They knew that open and honest responses were crucial to the integrity of the
findings, so creating an environment where people felt safe to share information was a top
priority.

By proactively addressing ethical considerations like confidentiality and data usage upfront,
the researcher was able to put the minds of the respondents at ease. This allowed the data
collection process to proceed smoothly, with participants feeling confident that their personal
and organizational information would be protected. It was a key part of the researcher's overall
commitment to conducting this study in an ethical, responsible manner.

36
CHAPTERFOUR

DATAANALYSISANDINTERPRETATION

This section presents the analysis and interpretation of data collected through employee
questionnaires and manager interviews. The questionnaires assessed employees' perceptions of
the bank's performance evaluation system, while the interviews provided qualitative insights
from branch managers. The mixed-methods approach allowed the researcher to develop a
comprehensive understanding of the performance management practices within the
organization.

4.1. Response Rate

The researcher distributed 204 questionnaires to the sampled employees. Out of these, 190
employees, representing 93.1% of the sample, properly filled out and returned the
questionnaires on time. The remaining 14 questionnaires, or 6.9% of the sample, were
discarded due to incompleteness.

The data obtained from the completed and returned questionnaires is summarized and
presented in the tables below. Following the quantitative data from the employee surveys, the
researcher also includes the responses gathered through the interviews conducted with the
branch managers. This combined approach allows for a comprehensive analysis of the
performance evaluation system from both the employee and management perspectives.

4.2. General Profile of Respondents

This section focuses on summarizing the demographic information of the research participants.
It includes details such as the respondents' gender, job category, age range, educational level,
and work experience. Analyzing these biographical data points helps provide context and a
clearer understanding of the sample population. This information can offer insights into how
factors like role, age, or tenure may influence the participants' perceptions and experiences
related to the performance evaluation system being studied.

37
By presenting this descriptive overview of the respondent characteristics, the researcher sets
the stage for a more meaningful interpretation of the subsequent findings from the
questionnaires and interviews. The demographic summary lays the groundwork for exploring
potential patterns, trends, or differences in perspectives based on the participants' backgrounds.

Table 2 General Profile of Respondents

Characteristics Frequency Percentage


Male 135 71.05
Gender
Female 55 28.95
Managerial 36 18.95
Job category
Non-Managerial 154 81.05
18-25 67 35.3
26-30 53 27.9
31-35 42 22.1
Age range 36-40 22 11.6
41-50 6 3.2

Diploma 5 2.6
Educational level
First degree 173 91.1
Master’s degree 12 6.3
1-2years 49 25.79
3-5years 43 21.05
6-10years 48 24.21
Work experience 11-15years 28 14.74
16-20years 20 10.53
Above25 2 1.05
Source: Own survey Data,2024

The survey results show that out of the total 190 respondents, 55 or 28.95% were female, while
135 or 71.05% were male.

38
In terms of age distribution, the majority of the respondents, 85.30%, were between 18 and 35
years old. Regarding the educational background of the participants, 91.10% or 173
respondents held a first-degree qualification, 6.3% or 12 had a second-degree, and only 2.60%
or 5 had a college diploma. This aligns with the bank's recruitment policy. When examining
the respondents' length of service at the Commercial Bank of Ethiopia (CBE), 73.68% or 140
of the sample had been working at the bank for less than 10 years, while the remaining 26.32%
or 50 had over 11 years of experience. The data suggests that more than 50% of the
respondents have 11 years or more of experience, indicating that the more experienced
employees likely have greater knowledge and familiarity with the bank's performance
evaluation system.

4.2. Analysis of the Collected Data

The second part of the analysis focuses on the employees' responses regarding the bank's
performance evaluation system. Specifically, it examines variables such as employees'
participation in performance planning, the clarity of goals, and other related aspects.

For the purpose of reporting the findings, the researcher has combined the values of "strongly
agree" and "agree" to represent the employees' overall agreement with each statement.
Similarly, the values of "strongly disagree" and "disagree" have been combined to represent the
employees' disagreement.

This approach provides a more concise and easily interpretable summary of the data. By
consolidating the agreement and disagreement responses, the researcher can better highlight the
general trends and sentiments expressed by the survey participants regarding the various
elements of the performance evaluation system.

This streamlined presentation of the findings allows the reader to quickly grasp the key patterns
and insights emerging from the employee feedback. The researcher's decision to combine the
adjacent response categories enhances the clarity and accessibility of the data analysis.

39
Table 3 Respondents' Awareness regarding the Linkage between Performance Evaluation and Business Strategic
Objectives.

Response Total
SD DA UD A SA
Item Statements
F % F % F % F % F % F %
1 Performance objectives of 33 22.10 35 10.53 47 32.11 75 35.26 190 100
employees are aligned with
the bank's goals.
2 Employees are clear about 42 26.84 20 19.48 61 23.68 57 30 190 100
how their roles fit with the
bank's strategic objective.
3 Employees have knowledge 41 30 29 23.16 46 31.05 74 15.79 190 100
about what the strategic
objectives of the bank are.
4 The strategies of the bank are 61 32.11 35 18.42 15 7.89 43 22.62 36 18.95 190 100
understandable.
Source: Own survey data,2024

To gather the necessary information, employees were asked to rate the statements about the bank's strategic
objectives on a scale ranging from "strongly disagree" to "strongly agree". For the first statement, "Performance
objectives of employees are aligned with the bank's goals", 67.37% of the respondents expressed their agreement,
while the minority, 32.63%, indicated their disagreement. This reflects that the existing goals of the bank are
strongly aligned with the employees' performance objectives. From the managers' perspective, there also appears
to be a good alignment between the bank's goals and the employees' performance objectives.

For the second statement, "Employees are clear about how their roles fit with the bank's strategic objective",
53.68% of the sample responded positively, and the remaining 46.32% confirmed their disagreement. This
suggests that when the strategic objective of the organization aligns with the employees' roles, there is an
improvement from both sides, and the manpower is utilized more effectively. Managers also agreed that
employees are clear about how their roles fit with the bank's strategic objective.

40
For the third statement, "Employees have knowledge about what the strategic objectives of the bank are", 46.84%
agreed with the statement, while 53.16% had a negative response. This implies that employees often carry out
their tasks by default, without a clear understanding of the bank's strategic objectives.

For the fourth statement, "The strategies of the bank are understandable", 41.57% of the sample respondents had a
positive response, indicating that they have a clear understanding of the bank's strategy. However, 50.53% of the
respondents responded negatively, suggesting that the bank's strategy is not understandable to them, and the
remaining 7.89% were undecided. The conclusion drawn from this statement is that the more understandable the
bank's strategy is, the more applicable it becomes, directly benefiting the bank itself. Managers also agreed with
this observation. During the interviews, most managers acknowledged the lack of a clear linkage between the
performance evaluation and the strategic objectives.

41
Table 4 Respondents Opinion on Employees Performance Standard

Response Total
SD DA UD A SA
Item Statements
F % F % F % F % F % F %
1 Employees are clear on 41 21.58 26 13.68 46 24.21 77 40.53 190 100
What their job duties and
responsibilities are.
2 Standards are attainable 64 33.68 53 27.90 25 13.16 27 14.21 21 11.05 190 100
by employee.
3 Standards are related to 30 15.79 28 14.74 62 32.63 70 36.84 190 100
the desired result of the
job
4 The supervisor gives a 102 53.68 41 21.58 30 15.79 17 8.95 190 100
chance for employees to
participate in setting
performance standards.
5 Standards are established 55 28.95 34 17.89 57 30 44 23.16 190 100
according to the
individual job description
And qualification.
Source: Own Survey Data, 2024

Table 4.3 shows the employee performance standards at the bank.

For the first item, "Employees are clear on what their job duties and responsibilities are",
64.74% of the respondents replied positively. This indicates that employees have a good
understanding of their main responsibilities and duties, which is essential to avoid confusion
and help them focus on key activities rather than wasting time on trivial matters. However,
35.26% of the respondents had a negative response, suggesting that some employees are still
42
unclear about their job duties and responsibilities. The interviewed managers emphasized that
creating clarity around employee job duties and responsibilities is mandatory.

For the second item, "The standards of the evaluators are attainable by employees", 61.58% of
the respondents disagreed, indicating that the evaluation standards are not realistically
achievable. Only 25.26% agreed that the standards are attainable, and 13.16% were undecided.
The interviewed managers also agreed that the attainability of the bank's standards is a concern.

The third item states that "The standards are related to the desired result of the job". 69.47% of
the respondents believed that the evaluation standards are closely related to the desired job
outcomes, while 30.53% disagreed. The open-ended feedback revealed that the criteria used for
employee appraisal do not reflect the specific job requirements. Instead, the evaluators are
often influenced by personal relationships, position, and seniority, leading to biased results
favoring senior staff over new employees, regardless of actual performance. This suggests that
the bank's performance rating practice is not based on job-related requirements derived from
the job description.

For the fourth item, 24.74% of the respondents agreed that they participate in setting their
performance standards, while the majority, 72.26%, indicated that they were not given the
opportunity to do so. This implies a lack of transparency in the goal-setting process. However,
setting performance standards should be a collaborative process between the manager and the
individual, where they discuss and agree on what the person will achieve and how they will do
the job.

The final item states that "Standards are established according to the individual job description
and qualification". 53.16% of the respondents agreed, while 46.84% disagreed. This suggests
that while the standards are intended to be based on individual job descriptions and
qualifications, there is still room for improvement in this area.

43
The non-managerial employees justified that they receive a job description at the time of
placement, which they consider as their performance standard. However, the managerial
respondents highlighted the vague and general performance appraisal criteria, which are not
based on the employee's job description or directly related to their output. Managers also
acknowledged the need for greater clarity and employee participation in setting performance
standards.

Table 5 Respondents Reaction to Communicating the Performance Standards

Response Total
SD DA UD A SA
Item Statements
F % F % F % F % F % F %
1 Employees are clearly 59 31.05 47 24.74 53 27.89 31 16.32 190 100
communicated personal
standards.
2 The process and objectives 81 42.63 41 21.58 37 19.47 31 16.32 190 100
of performance evaluations
are described clearly to the
employees.
3 The supervisor clearly 67 35.26 52 27.37 45 23.68 26 13.69 190 100
explains to the employees
about standards that will be
used to evaluate their work.
Source: Own Survey Data, 2024

Table 4.4 shows that communicating the standards. On this table item number one mentioned
about, Employees are clearly communicated personal standards from the respondents
55.79%had negative response on it, this indicates the absence of updating personal standards
for the employees clearly, which results in poor performance of employee. For item number
two, the process and objectives of performance evaluations are
describedclearlytotheemployees,64.21%oftherespondents’disagreed.Thisindicatesthat,thesuper
visors did not explain the process and objective of the performance evaluations. And the
44
remaining 35.79% of respondents agreed on the supervisors describe and elaborate the process
and objective of performance evaluation system of the bank.

The final item from this table, 62.63% of respondents’ replayed negatively that
supervisorclearlyexplainstotheemployeesaboutstandardsthatwillbeusedtoevaluatetheirwork.
37.37% of employees agreed with the clear explanation of the supervisors to employees
aboutstandardsthatwillbeevaluatetheirwork.Managershavepositivecommentonthecommunicatin
gof standards for the employees.

Table 6 Respondents Awareness to Measure the Actual Performance


Respons Total
e
Ite Statements
S DA UD A SA
m
D
F % F % F % F % F % F %
1 The supervisor reached an 45 23.68 84 44.22 26 13.68 35 18.42 190 100
agreement with employees
on how their performance
will be measured.
2 The actual performance of 68 35.79 53 27.89 41 21.58 28 14.74 190 100
the employee is measured
based on the set
performance standard.
3 The supervisor’s personal 88 46.32 61 32.11 29 15.26 12 6.31 190 100
bias does not affect the
outcome of the evaluation
process.
4 The overall evaluation 72 37.89 56 29.47 38 20 24 12.64 190 100
process is formalized,
standardized and made as
objective as possible.
5 The employee performance 87 45.79 49 25.79 33 17.37 21 11.05 190 100

45
evaluation of the bank
perfectly evaluates the
employee.
Source: Own survey data, 2024

The first item on the table reflects a concerning issue - only 32.10% of respondents indicated that there was an
agreement between supervisors and employees on how performance would be measured. A staggering 67.90%
disagreed with this, suggesting a lack of alignment and transparency around the performance measurement
process.

Moving on to the second item, 63.68% of respondents felt that employee performance was not solely measured
based on the set performance standards. This implies that there are additional, perhaps undisclosed, measures
being used to evaluate performance, which may leave employees feeling confused and uncertain about the
criteria.

However, the open-ended responses provided some additional context. While performance is ostensibly measured
against the bank's appraisal criteria, the respondents felt that these criteria were quite subjective and applied
uniformly across job grades. Worse still, they perceived that evaluators tended to rely on factors like seniority,
personal relationships, and past performance history, rather than objective measures.

The third item paints a particularly troubling picture - a vast majority of 78.43% of respondents believed that
supervisors' personal biases significantly affected the outcome of the evaluation process. This points to a deeply
flawed system that lacks fairness and transparency.

Respondents' views on the overall evaluation process were equally concerning. A sizable 67.36% felt that the
process was not formalized, standardized, or sufficiently objective.

Finally, the fifth item revealed that 71.58% of respondents did not believe that the bank's performance evaluation
system perfectly captured employee performance. While 28.42% had a more positive view, the overwhelming
sentiment was that the system had significant gaps and shortcomings.

46
The data from Table 4.5 suggests that the bank's performance evaluation processes are plagued by a lack of
clarity, objectivity, and fairness. Employees feel disempowered and distrustful of a system that appears to be
heavily influenced by subjective factors and personal biases. Addressing these concerns should be a top priority
for the bank's leadership.

47
Table 7 Respondents Opinion on Comparison of Actual Performance with the Standards

Response Total
SD DA UD A SA
Item Statements
F % F % F % F % F % F %
1 The actual 35 18.42 31 16.32 9 4.74 72 37.89 43 22.63 190 100
performance is
objectively compared
with employee’s
performance standard.
2 The comparison 45 23.68 37 19.47 57 30 51 26.85 190 100
clearly identifies the
deviation between
actual performance
and the set standard.
3 Result of the appraisal 44 23.16 41 21.58 7 3.68 61 32.11 37 19.47 190 100
is communicated and
discussed with the
employees on one-to-
one basis.
Source: Own Survey Data, 2024

The first item indicates that the majority of respondents, 60.52%, believe that the bank
objectively compares employees' actual performance to their set performance standards. This
suggests that the bank is making efforts to use the established standards as a basis for
evaluation. However, a concerning 34.74% of respondents disagreed with this, indicating that
there may still be room for improvement in ensuring the objectivity of this comparison process.

Moving to the second item, over half of the respondents (56.85%) felt that the comparison
process clearly identifies the deviations between actual performance and the set standards. This
48
is a positive sign, as it implies that the bank is providing employees with transparent feedback
on how their performance measures up to the expected norms. However, a significant minority
(43.15%) disagreed, hinting that the clarity of this comparison process may not be universal
across the organization.

The third item explores how the results of the performance appraisal are communicated to
employees. Here, the responses are more mixed – 51.58% of respondents indicated that the
results are communicated and discussed with employees on a one-on-one basis, while 44.74%
disagreed. This suggests that the bank may not have a consistently applied approach to
providing personalized feedback to all employees.

The data from Table 4.6 paints a somewhat mixed picture. While the majority of respondents
seem to believe that the bank is making efforts to objectively compare actual performance to
standards and provide feedback, there are still sizable minorities who feel that the process lacks
transparency and consistency. Addressing these concerns and ensuring a more standardized,
employee-centric approach to performance evaluation could go a long way in improving trust
and engagement within the organization.

Table 8 Respondents View on Performance Evaluation Feedback

Response Total
SD DA UD A SA
Item Statements
F % F % F % F % F % F %
1 Possible solutions are 91 47.89 52 27.37 33 17.37 14 7.37 190 100
discussed with the aim
of the problem solving
and reaching
agreement.
2 The standard will be 42 22.11 30 15.79 87 45.79 31 16.32 190 100
modified according to
49
the relevant feedback
from the employees or
The evaluators.
3 The performance 75 39.47 41 21.58 58 30.53 16 8.42 190 100
evaluation feedback
task is done very
carefully.
Source: Own Survey Data, 2024

The first item reveals a concerning statistic - only 24.74% of respondents agreed that possible
solutions are discussed with employees with the aim of problem-solving and reaching
agreement. A staggering 75.26% disagreed with this, suggesting a major disconnect between
employees and their evaluators. This points to a critical information gap, where employees may
feel their voices are not being heard or their input is not being meaningfully incorporated.

Turning to the second item, a majority of 62.11% of respondents agreed that performance
standards are modified based on relevant feedback from employees or evaluators. This is a
positive sign, as it indicates the bank is willing to adapt its benchmarks based on real-world
experience and employee input. However, the 37.89% who disagreed may represent those who
fear that providing feedback could lead to unfavorable consequences like demotion or
termination.

The third item is particularly worrying - only 38.95% of respondents felt that the performance
evaluation feedback process is done very carefully. A significant 61.05% disagreed, suggesting
that the feedback is not being provided with the level of diligence and sensitivity that
employees expect. This could further erode trust in the process and leave employees feeling
frustrated and demoralized.

These findings highlight the need for the bank to significantly improve its employee feedback
mechanisms. Fostering open dialogues, incorporating employee input into the standard-setting
process, and ensuring feedback is delivered thoughtfully and constructively could go a long
way in building a more transparent, collaborative, and effective performance evaluation
system. Addressing these gaps should be a top priority for the bank's leadership.

50
Table4.8. Respondents reaction about the Advantages of Taking Corrective Action

Table 9 Respondents reaction bout the Advantages of Taking Corrective Action

Response Total
SD DA UD A SA
Item Statements
F % F % F % F % F % F %
1 The corrective action is 65 34.21 42 22.11 68 35.79 15 7.89 190 100
given after fair and
objective investigations
Are made.
2 The objective of the 82 43.16 38 20 42 21.58 29 15.26 190 100
corrective action is to
correct and resolve
employee’s performance
problem and retain
Employee productive.
3 Employees will be 81 42.63 31 16.32 17 8.95 32 16.84 29 15.26 190 100
provided couching,
counseling and retaining
when there is
Incapability.
Source: Own Survey Data, 2024

The first item indicates that only 43.68% of respondents agreed that corrective action is given after fair and
objective investigations are made. This is quite concerning, as it suggests that in over half of the cases (56.32%),
corrective measures may not be grounded in a thorough, impartial review of the employee's performance. Without
this foundation of fairness and objectivity, corrective actions run the risk of being perceived as arbitrary or
punitive by employees.
Moving to the second item, an even smaller proportion - just 36.84% - agreed that the objective of corrective
action is to correct and resolve employee performance problems, with the ultimate goal of retaining productive
employees. The majority, 63.16%, disagreed with this, implying that corrective measures may be more focused
51
on punishment or demotion rather than constructive problem-solving. This is a crucial distinction, as an overly
punitive approach is likely to breed resentment and demotivation among employees.

The third item paints an equally troubling picture - only 32.1% of respondents agreed that employees are provided
with coaching, counseling, and retraining when they exhibit performance deficiencies. The overwhelming
majority, 67.9%, disagreed with this. This suggests a significant gap in the bank's ability to offer targeted,
remedial support to help underperforming employees get back on track. Without such developmental
opportunities, the corrective action process may feel more like a dead-end for employees.

The insights from the interview sessions further reinforce the importance that respondents place on using
corrective action to address behavioral issues and severe performance shortcomings. However, the survey data
indicates that the bank's current approach may be falling short in terms of fairness, constructiveness, and
developmental support.

To truly harness the power of corrective action as a tool for improvement, the bank should strive to create a more
transparent, employee-centric process. This could involve strengthening investigation procedures, aligning
corrective measures with developmental goals, and providing robust coaching and training resources. By taking
these steps, the bank can foster a culture of accountability and growth, rather than one of punishment and
resignation.

52
CHAPTERFIVE

FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

In this chapter, the research findings are thoroughly discussed, and important insights are
highlighted to address the gaps identified in the bank's current performance evaluation system.
The data revealed significant disconnects between employees and evaluators, with concerns
around the lack of collaborative problem-solving, transparent modification of performance
standards, and diligent delivery of performance feedback. The corrective action processes also
raised red flags, as less than half of respondents agreed that these measures are based on fair
and objective investigations, and the majority felt the focus was on punishment rather than
constructive, developmental support. To remedy these issues, the chapter recommends
strengthening two-way communication channels, ensuring meaningful incorporation of
employee input, providing training to evaluators, enhancing investigation procedures, aligning
corrective actions with developmental goals, and investing in robust training and support
resources for underperforming employees. By fostering a more collaborative, transparent, and
employee-centric performance management culture, the bank can build trust, improve
engagement, and unlock the full potential of its workforce. Continuous monitoring and
refinement of the performance evaluation system will be critical to ensure its long-term
relevance and effectiveness.

5.1. Summary of Major Findings

The data analysis revealed some mixed results when it comes to how the bank's performance
management system is working. On the plus side, most employees feel their individual
performance objectives are well-aligned with the bank's overall business goals. And they
generally have a good handle on how their specific roles and responsibilities fit into the bigger
strategic picture.

Interestingly, opinions were more positive when it came to the clarity of individual job duties
and responsibilities. But employees were less convinced that the performance standards they're
being measured against are actually attainable. That said, they do generally feel those standards
are relevant to the core duties and desired outcomes of their roles.
53
The real pain point seems to be around employee participation in the performance management
process. Respondents overwhelmingly reported that they have very little input into setting the
standards by which they'll be evaluated. And that's a problem, since employees really should be
active partners in shaping job descriptions, metrics, and review procedures.

Another key issue is lack of transparency and communication around performance


expectations. Many employees don't feel they have a clear, shared understanding of what
success looks like or what their manager’s value most. They're often left in the dark, without
the guidance and support they need to really excel.

When it comes to the actual measurement of performance, there are some serious concerns.
Employees don't feel there's adequate agreement with their supervisors on evaluation criteria,
and they worry the process is too subjective and biased. There's a sense that the overall system
is not particularly formalized or rigorous.

That said, respondents did indicate that performance is generally compared objectively to
established standards, with clear identification of any gaps. But they also noted a lack of
collaborative problem-solving around issues that arise during the evaluation process. And they
feel feedback is not handled as carefully as it should be.

Finally, there were doubts around the fairness and effectiveness of any corrective actions
triggered by poor performance. Employees don't feel these interventions are grounded in
thorough investigation and a genuine focus on development and improvement. There's a sense
that the system is more about punishment than genuine support.

Taken together, these findings suggest the bank has some work to do when it comes to building
a performance management approach that is truly transparent, collaborative, and centered on
helping employees grow and succeed. Empowering staff to shape the process and addressing
communication gaps will be key.

5.2. Conclusions

Based on the feedback from respondents, it's clear there's a disconnect between the bank's overall
strategy and how employees' individual performance is actually evaluated. A lot of folks feel like
the standards they're being measured against aren't very clear or well-explained. They're just kind

54
of working in the dark, without a shared understanding of what success looks like or what the
organization's true priorities are.

And when it comes to the actual performance evaluation process, there are some real issues. The
criteria being used often feel subjective and biased, rather than tied to clear, agreed-upon metrics.
And employees' input and participation in setting those standards is seriously lacking. They don't
feel like they have much of a voice.

What's more, the corrective processes that kick in when someone's performance falls short seem
to be more about punishment than genuine support and development. Managers don't always
have a firm grasp on how to help struggling employees get back on track.

The goal-setting process is also problematic. Targets are often not negotiated with employees or
aligned with broader organizational objectives. They just feel unattainable. And the feedback
loop between managers and their teams is sorely lacking. People don't feel like they're getting the
regular, constructive input they need.

Ultimately, the general consensus is that the bank's performance evaluation system just isn't
working that well. It feels unfair, opaque, and disconnected from the realities on the ground.
There's a lot of room for improvement in terms of clear communication, collaborative goal-
setting, objective measurement, and meaningful development support.

If the bank can get those fundamentals right, it would go a long way toward building trust,
boosting engagement, and getting the most out of its workforce. But it's going to take a real
commitment to transparency, employee empowerment, and managerial accountability. Baby
steps won't cut it - this needs a top-to-bottom overhaul.

5.2. Recommendations

When it comes to the performance evaluation system, the bank really needs to do a better job of
communicating with employees. A lot of folks don't fully understand the purpose and process
behind it all. It's crucial that the bank, from the top down to the branches, takes the time to
explain why this system is in place and how it works. Employees need to feel like they're part of
it, not just passive subjects.

One key thing is getting employee participation from the very beginning. Let them have a real

55
voice in setting the performance standards they'll be measured against. This will help create a
sense of ownership and investment in the process. Supervisors should also be providing regular,
transparent feedback on how employees are doing in relation to those agreed-upon goals. That
open dialogue and trust-building is so important.

The performance standards themselves shouldn't just be dictated from on high either. There
needs to be room for negotiation and collaboration between managers and their team members.
Employees should have a say in what targets they're expected to hit. This dual goal-setting
approach gives people clearer direction and a stronger drive to succeed.

And when it comes to evaluating that performance, the bank has to make sure there are no
personal biases creeping in. Get feedback from both employees and managers to ensure the
process is fair and objective. And when issues do come up, the focus should be on constructive,
developmental solutions - not just punitive measures. Provide the coaching, training, and support
people need to improve.

At the end of the day, the bank's leadership has to be committed to making this a truly
collaborative, transparent system. Set achievable, meaningful goals. Foster open communication.
And bring in independent oversight to keep things on the up-and-up. With the right approach,
this performance evaluation can be a powerful tool for unlocking the full potential of the bank's
workforce.

56
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Appendices

NEW GENERATION UNIVERSITY COLLEGE


DEPARTMENT OF BUSINESS ADMINISTRATION

Dear Sir/Madam,
I am a graduate student in the Department of business administration . I am currently conducting a research
study on the topic of "Assessment of performance evaluation systems." This study is being undertaken as part
of the requirements for Business Administration degree.. I am currently conducting a research study for my
master's thesis on the topic of "Assessment of performance evaluation systems." This study is being
undertaken as part of the requirements of Business Administration.
The main objective of this questionnaire is to collect information regarding the performance evaluation
system at CBE. The data gathered from this study will be used solely for academic purposes. Your honest and
genuine responses to the questions are crucial for ensuring the quality and successful completion of the study.
The accuracy of the information you provide greatly influences the reliability of the findings. Please note that
you are not required to disclose your name while completing the questionnaire. Thank you for your
cooperation and for taking the time to contribute your valuable insights.

61
Section: A. General Information of the Respondents

Please tick (√)in the appropriate box

1. Your Gender Male Female


2. YourAgeRange18-25 5 26-30 31-35
46andabove
36-40 3 41-45

3. Your Work Experience in Bank (In


years)1-2 3-5 6-10 11 to15
16to20 21to25 Above 25 years of service

4. Your highest level of education

High school certificate College Diploma First Degree


Master’s & above other, please specify
5. Your Job category Managerial Non Managerial

Section: B. Opinion on Employees Performance Evaluation system

Please indicate the extent to which you agree or dis agree with the following statements
byputting√inthespaceprovidedbyusinglikertscalesuchas:SA=StronglyAgreeA=AgreeUD=Undeci
ded DA= Disagree SD=Strongly Disagree
Business strategic objectives

Statements SD DA UD A SA
1 Performance objectives of employees are aligned with the

bank’s goals.
2 Employees are clear about how their roles fit with the

Banks strategic objective.


3 Employees have knowledge about what the strategic

62
Objectives of the bank are.
4 The strategies of the bank are understandable.

63
Employees Performance Standard

Statements SD DA UD A SA
1 Employees are clear on what their job duties and

Responsibilities are.
2 Standards are attainable by employee.
3 Standards are related to the desired result of the job
4 The supervisor gives a chance for employees to

Participate in setting performance standards.


5 Standards are established according to the individual job

Description and qualification.

Communicating the Standards

Statements SD DA UD A SA
1 Employees are clearly communicated personal standards.
2 The process and objectives of performance management

are described clearly to the employees.


3 The supervisor clearly explains to the employees about

Standards that will be used to evaluate their work.

Measure the actual performance

Statements SD DA UD A SA
1 The supervisor reached an agreement with employees

On how their performance will be measured.


2 The actual performance of the employee is measured

Based on the set performance standard.


3 The supervisor’s personal bias does not affect the

64
Outcome of the evaluation process.
4 The overall evaluation process is formalized,

Standardized and made as objective as possible.

65
5 The employee performance evaluation of the bank

Perfectly evaluates the employee.

Compare the actual performance with the standards

Statements SD DA UD A SA
1 The actual performance is objectively compared with

employee’s performance standard.


2 The comparison clearly identifies the deviation between

Actual performance and the set standard.


3 Result of the appraisal is communicated and discussed

With the employees on one-to-one basis.

Providing feedback

Statements SD DA UD A SA
1 Possible solutions are discussed with the aim of the

Problem solving and reaching agreement.


2 The standard will be modified according to the relevant

Feedback from the employees or the evaluators.


3 The performance evaluation Feedback task is don every

Carefully.
4 The feedback provided through performance evaluation is
valuable and contributes to enhancing employee performance by
aiding in their improvement.

66
Taking corrective action

Statements SD DA UD A SA
1 The corrective action is given after fair and objective

Investigations are made.


2 The objective of the corrective action is to correct and

Resolve employee’s performance problem and retain

67
Employee productive.
3 Employees will be provided couching, counseling and

Retaining when there is in capability.

If you have any additional information other than mentioned before please put it specifically.

Thank You

68
APPENDIX TWO: INTERVIEW QUESTIONS

1. Is there periodical feedback given to the employees according to their performance after
evaluation?

2. Do you think it is essential to conduct performance evaluation in your organization? Why?

3. Could it be possible to say that CBE has successfully implemented a performance evaluation
system?

4 Does the specific job performed by an individual link with the strategic objectives of the
organization?

5 Does the performance evaluation system bring the desired outcome to CBE? If yes, discuss
how tangible results were observed.

6 Do you think that employees are well informed about performance evaluation systems in
order to develop their awareness about it?

7 Do you have any other comments or suggestions regarding the performance evaluation
system at CBE?

69

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