Employee Satisfaction: A Case Study

CHAPTER 1: INTRODUCTION

1. Problem Statement

In recent times the concept of performance management has gained wide popularity in the organizations worldwide. Most of the researches in the field are focused on the discussion of a single factor in performance management. The growing use of the concept shows that the performance management practices can be used to increase the level of employee satisfaction. It is important to know what factors are likely to influence the employees’ satisfaction with respect to their work and make them engage in the organization. There is a need to investigate whether there is an effect of performance management on employee satisfaction.

1.1 Background of the study

In recent times, establishing an effective performance

The term was first used in the 1970s, while the new existence of this term was known in the late 1980s, as a reaction to the negative aspects of the scoring system (Listani and Kartini, 2015). Bititci, Carie and Devitt (1997), define performance management as a “process by which the company manages its performance in line with its corporate and functional strategies and objectives”. It is a continuous process of communication between a supervisor and an employee that occurs throughout the year, in order to evaluate that whether the strategic objectives of the organization are achieved. The communication process of performance management includes clarifying expectations, setting objectives, identifying goals, providing feedback, and reviewing results. It is considered to be a critical aspect of organizational effectiveness. According to Armstrong (2000, as cited in Kagaari, Munene and Nayi 2010), performance management is a means of getting better results from the whole organization or teams or individuals within it, by understanding and managing performance within an agreed framework of planned goals, standards and competence

Employee satisfaction is considered either as an overall feeling about the job, or as a related set of attitudes about various aspects of the job (Spector, 1997 as cited in Pastuszak, 2011). Employee satisfaction has continued to be a notable area of discussion in the field of management and especially in organizational culture and human resource management for a long period of time. Employees are perceived to be more loyal and productive when they are satisfied and these satisfied employees affect the customer satisfaction and organizational productivity (Aydin and Ceylan, 2009). Employee satisfaction is an important variable that is able to give an idea about the general emotion and thinking forms of employees about their job and workplace.

Performance appraisal activities such as cooper¬ation, goal setting, communication and feedback affect satis¬faction with performance appraisal that consequent¬ly affects employee satisfaction and productivity. The previous research done in the field shows that, Performance appraisal system by using inter¬action helps the relationship between the supervisor and the subordinate. It makes employee involved, satisfied and motivated and especially the fairness element in the performance management is important for employee