Performance appraisal in organizations
Organizations are in constant battles to ensure that their employees are motivated. Motivation has commonly been referred to as a psychological process that leads to arousal, direction, and persistence on a voluntary action that is goal-oriented. For the growth of firms, employees are the vital part that must be there to achieve success and growth (Kusluvan, S., Kusluvan, Ilhan, and Buyruk, 2010). Organizations use the management sector to employ various expertise and techniques to efficiently plan, organize, direct, and control the operation of the firm to achieve the desired growth and success. The human resource management is entrusted with managing the workforce of organizations and they are responsible for recruiting, and retention of employees as well as the training and development that employees receive to boost their efficiency, productivity and ensure they are satisfied in their workplace and as such promote the success of the firm. Performance appraisal is usually used by human resource managers (HRM) as a way of evaluating the performance of their employees which is a vital task while striving towards the success of the company (Pichler, 2012). Organizations seek to find the desirable performance of their employees and which is dependent on positive job attitudes such as commitment and job satisfaction. Performance appraisals have extended their roles from just rating the performance of the employees, to other aspects such as job motivation.
In the hospitality industry, performance appraisals play a crucial role in ensuring that the employees retain their positive attitudes and as such the hospitality organizations remain competitive in a continuously shrinking labor pool (Kong, Cheung, and Song, 2011). The following proposal seeks to explore how performance appraisal influences the job satisfaction of the employees in the Chinese hospitality industry.
Research problem
High employee turnover in the hospitality industry results in negative consequences, for employees are a crucial part that renders and creates services and as such leads to great customer experience. The hospitality industry plays a great role in the Chinese economy and a survey conducted by the china tourism Association showed that high turnover rates in the industry are at 19.8 % (Qiu, Haobin Ye, Hung, and York, 2015). In developed cities like Shanghai and Beijing, the turnover rate is said to be higher. However, when compared to a country like the US whose turnover is at 48%, China is said to have a lower turnover rate (Chen, Ayoun, and Eyoun, 2018). The hospitality industry has invested in performance appraisals as a way of motivating their employees and reduce the high turnover rates.
Aim and objectives
This study seeks to investigate whether the type of employee performance appraisal approaches used in hospitality organizations influence employee job satisfaction. The study is based on China’s hospitality industry which is characterized by high turnover levels.
Objectives
- To establish employees’ perception of fairness of the appraisal systems used in China’s hospitality sector
- To investigate the influence of the type of performance appraisal on the quality of the relationship between employee and supervisor in China’s hospitality sector
- To analyze the impact that performance appraisal systems has on employee job satisfaction in China’s hospitality sector
Significance of the research
The following research will be an important tool for the knowledge that is present on performance appraisals and their impact on job satisfaction on the employees of the Chinese hospitality industry. The study will be useful in Chinese hospitality which has been noted to have a huge impact on the Chinese economy. Additionally, the study will be a reference for other related studies in the future.
Literature review
A performance appraisal has been defined as a discrete, organizational sanctioned event, and one that is formal, and it states the performance dimensions used in the evaluation process. It is said to be a formal procedure of monitoring the employees and it involves performance evaluations on the basis of opinions and judgment of supervisors, subordinates, other managers, and peers (Kong, Cheung, and Song, 2011). The main concern behind the performance is the clarification of the expectations of the employees, help them with individual growth as well as the collective growth of the whole workforce at large. Performance appraisal has been noted to help in guiding the employees on how the organization expects them to perform towards the organizational goals. Studies have shown that three main reasons lead to the undertaking of a performance appraisal and which have been categorized as developmental and evaluative.
The first is to attain a review of the employee’s performance. It allows employees to learn their strong areas as well as areas that they need to improve on and which is done through discussion by managers and their employees creating a bond between the employees and the managerial department (Heponiemi, Manderbacka, Vänskä, and Elovainio, 2013). Second, managers communicate their reward decisions such as increased pay, promotions, layoffs, poor performance, retention, and benefits to the employees. Additionally, they can receive feedback directly from the employee. Lastly, the performance appraisal provides an opportunity for employees to receive information on future opportunities and their progression as well as suitable work for them in the future and how that can be achieved.
There are various approaches used by different firms for undertaking performance appraisals and they have been broadly categorized as a result-focused approach and behavior-based approach. The result based method focuses on the results brought by the appraisal. Some of the methods in the result based method include management by objective (MBO). MBO is a contemporary performance appraisal that evaluates the performance of the employee objectively (Heponiemi, Manderbacka, Vänskä, and Elovainio, 2013). In this approach, managers and the employees discuss which goals are to be achieved and ways to achieve them.
The behavior-based approach has been defined to use particular factors of performance while evaluating the employees. They include the forced-choice method and rating scales method. The behaviors may be different depending on the type of task at hand. The method has been termed as effective for it does not evaluate an employee based on the performance of another employee, but rather, every employee is evaluated on his performance yardsticks. Other studies have identified other approaches like 360 degrees appraisal which have been described to take an all-inclusive approach (Kamruzzaman, 2020). In this approach, employees receive feedback from all parties that are related to him such as supervisors, managers, and other team members.
The equity theory is used to explain the importance of an employee’s perception of fairness in the appraisal system. The theory focuses on relational satisfaction when it comes to the perceptions of fair or unfair (Rowland, and Hall, 2012). Employees are said to seek fairness for their contribution to an organization. They are said to weigh according to how they view other employees’ contributions to the company and how the organization rewards them. As a result, the issue of motivation is bordered here for when an employee perceives his treatment from the organization as fair, then he maintains a healthy relationship with the organization and his colleagues. In the situation where an employee is under or over rewarded, they tend to work towards decreasing or increasing their contributions respectively. The theory focuses on recognition and rewards and which are usually shown in the form of salary increments, bonuses, and promotions (Robbins, Ford, and Tetrick, 2012). In relation to the performance appraisal, the theory argues that fairness is present and it reflects in actions such as the provision of feedback, making roles clear to every employee, promotions, and as a result, employee’s job satisfaction is attained.
Supervisors of firms are expected to prepare performance expectations of their employees and the employees need to understand the objectives or the scope that they are expected to achieve for the organization easily (Chen, Sun, Lam, Hu, Huo, and Zhong, 2012). As such, the preparation of a performance appraisal is easily done in assessing the performance of the employees. The leader-member exchange theory states that the relationship between the employee and the supervisor and how it affects the performance of the employee (Culbertson, Henning, and Payne, 2013). The relationship is termed to be ambiguous and more dynamic and as such a variety of tools are needed to develop a performance appraisal. For instance in the feedbacks from the 360 system are important to the supervisor for they learn to have clear communication with their subordinates (Kamruzzaman, 2020). Employees strive to have a good relationship with the supervisor as a way of ensuring they achieve the expectation that they fixed with the management. They work together towards achieving the organizational goals and this is a positive thing on the employee’s performance appraisal. Employees are said to believe that if they get the trust of their supervisors, then their performance appraisal will be done fairly, they may receive more respect as well as more opportunities. In return, the employee receives job satisfaction, which has been termed as crucial in terms of productivity and in reducing the high rates of employee turnovers. They also end up with great relationships with their supervisors or their managers depending on who is doing the appraisal.
(Shrivastav & Sapra, 2012) emphasize that the impacts of the performance appraisal on the attitudes of an employee are based on rewards and feedback. Providing employees with feedback after undertaking a performance appraisal is said to have positive impacts on their performance. The feedback is said to contribute to a healthy and strong relationship between the supervisor and the employee and also grants the employee the motivation needed to work fruitfully towards the growth of the organization. Performance appraisals are also termed as key when it comes to guiding the employees towards the organizational goals as well as their personal goals (WAHJONO and MARINA, 2016). If the performance appraisal is poorly undertaken, studies have shown that there could be detrimental effects on the employee’s performance which translates to the poor performance of the organization.
Daoanis (2012) undertook a study on the impacts of the performance appraisal where she found that it contains positive and negative impacts on the employees. In her study, she found that the loyalty of the employee is highly affected, and depending on the effect whether positive or negative, the initiative of the employee to work changes for the better or the worse. When the organization rewards the employees fairly, the employees are said to tend to feel obliged to repay the firm in the form of high performance and high productivity. Additionally, having clear roles to employees is said to have a positive impact on the employee’s performance appraisal. Finally, when developmental performance appraisal is undertaken, the employees tend to receive a sense of belongingness and the feeling and perception of being of value to an organization increases the level of job satisfaction of an employee with results being increased productivity to the organization.
Research questions
What are the employee’s perceptions of fairness of the appraisal systems used in China’s hospitality sector?
What is the influence of the type of performance appraisal on the quality of the relationship between employee and supervisor in china’s hospitality sector?
What are the impacts of the performance appraisal systems on employee job satisfaction in China’s hospitality sector?
Methodological approach
Research design
There are various methods used in research and they include quantitative, qualitative, and mixed-method (Saunders, Lewis, Thornhill, Booij, and Verckens, 2011). The quantitative method is usually more objective and it focuses on evaluating evidence as well as clarifying hypotheses and theories. It deals with collecting and analyzing statistics, counting, and measuring variables. The qualitative method focuses on interpreting non-numerical data and is more subject to fewer numbers but more interviews. The mixed method of research incorporates both qualitative and quantitative methods of research.
The following research seeks to conduct a survey of employees serving in large hospitality organizations in china and hence it would make use of the quantitative research method. The research will collect the needed information for the study without changing the environment and as such provides a clear picture of the phenomena under investigation. The instrument to be used for the research will be questionnaires that should provide a standard model of collecting data and later analyzing the data using statistical methods. Some of the benefits connected to the quantitative method include the ability to test hypothesis and it allows for the researcher to measure precisely the relationship between the performance appraisal and the issue of high employee turnover rates (Saunders, Lewis, and Thornhill, 2012). It does not, however, provide wealthier data when compared to qualitative research.
Research philosophy
Research philosophy has been defined as the study of knowledge that deals with how data and information are collected, analyzed, and used. The philosophy of interpretivism argues reality is well understood in form of a subjective approach to obtain knowledge, views, expectations, and experiences of social actors (Saunders, Lewis, Thornhill, Booij, and Verckens, 2011). On the other hand, the philosophy of positivism argues that knowledge and reality of a given phenomenon are in existence objectively and it can be examined scientifically in the absence of a researcher.
In the following research, the aim is to establish the relationship existing between performance appraisal and the high employee turnover in the Chinese hospitality industry. As a result, the philosophy of positivism would be best effective for the research for it will allow a better measurement of the relationship between the two variables of study (Saunders, Lewis, and Thornhill, 2012). Since positivism is associated with objectivity, it will provide the research with reliable findings.
Research strategy
The research will employ the use of surveys to collect data and answer the research questions. The surveys are suitable for the research since they allow the researcher to collect data from large samples and as a result, attain enough findings to make the right conclusions.
Sampling technique and data collection
The right data for any research is needed if the right conclusions are to be made and hence it is crucial to decide on how the samples of the research will be collected. The use of wrong data would result in wrong conclusions and hence jeopardize the study (Saunders, Lewis, Thornhill, Booij, and Verckens, 2011). Before collecting data samples, it is worth considering the following key points sampling technique, sample size, be sure that the sample represents the population and the sample frame. The population at hand for this research is the Chinese population working in the hospitality industry and especially the big hotels. The reason they are the person of interest is since the research is focused on identifying the relationship between the performance appraisal and the high employee turnover in the Chinese hospitality industry. The employees in the hotels are in a better position to give the right data. For this research, questionnaires will be issued to at least two hundred and fifty employees selected through stratified random sampling in the Chinese large hotels. The questionnaires should be simply composed in a language that does not lead to ambiguity and to allow all respondents to understand the questions.
Data analysis techniques
Quantitative research methods require that statistical techniques are applied to analyze the data collected during the study (Saunders, Lewis, and Thornhill, 2012). As a result, the following study will also make use of the statistical techniques where excel spreadsheets will be used to code the raw data obtained from the questionnaires, from where the data will be analyzed using IBM’s SPSS which is a complex statistical data analysis software. The type of analysis expected is descriptive analysis in form of standard deviation and mean as a way of establishing main aspects of the respondents such as how the performance appraisal affects their loyalty or it motivates them to work towards the productivity of the company. To finalize, the Pearson correlation and regression analysis will be used in determining what relationship exists between the independent and dependent variables under study.
Research ethics
Ethics are a crucial part of every field of study as well as in our daily activities. The following research intends to observe three key principles of research that deal with human subjects which are the principle of respect, beneficence, and justice (Saunders, Lewis, Thornhill, Booij, and Verckens, 2011). For the above principles to be observed, the researcher must ensure that he observe several aspects of research. It would be ethical to notify the respondents before handing out the questionnaires through the use of emails and ensure that the intention of filling out the questionnaires is explained. Alternatively, the researcher can just explain by the use of the word of mouth the intention of the research. In the case where the respondents are unwilling to fill out the questionnaires, the researcher should not attempt to coerce them but rather respondents should fill the questionnaires at their convenience and when comfortable. The researcher should also ensure that they assure the respondent of handling their information with the utmost confidentiality and this could be one way of having the respondent gaining the confidence of participating in the study as well as providing the correct data (Saunders, Lewis, and Thornhill, 2012). Other ethical considerations to be observed by the researcher include avoidance of any form of physical or psychological harm to the respondent or other participants.
Discussion and conclusions
The following study aims at finding out the relationship existing between the performance appraisal and the high turnover rates in the Chinese hospitality industry. The research will focus on china’s large hotels. Similar studies have not been prevalent and considering that the hospitality industry has a great impact on the Chinese economy, the study is expected to bring light on whether the hospitality industry should embrace the performance appraisal and if so which approaches to use to ensure that the high turnover rates are reduced. It is however worth noting that if one approach works for a particular firm, it does not have to necessarily work for another firm.
The research hence intends to find out how the employees perceive the performance appraisals and how these perceptions affect their productivity and the growth of the firm. It will also focus on attaining the quality of relationships that are resulted from the performance appraisal between the supervisors and the employees. Additionally, it will attempt to understand how the performance appraisals impact the job satisfaction of the employees. The study will attain that by reviewing literature and also use quantitative research methodology to obtain the data needed to inform the study.