ASSESSMENT OF EMPLOYEE PERFORMANCE APPRAISAL

PRACTICES IN CASE OF ETHIOPIA ROAD AUTHORITY

WOLKITE BRANCH

A RESEARCH PAPER SUBMITTED FOR THE PARTIAL

FULFILMENT OF REQUIREMENT BACHELOR OF ART (BA)
DEGREE IN MANAGEMENT

BY: ESHETU FIKEDU

ADVISOR: AYAL ADAMU (MBA)

WOLKITE UNIVERSITY
COLLEGE OF BUSINESS AND ECONOMICS
DEPARTIMENT OF MANAGEMENT

JUNE, 2016

WOLKITE. ETHIOPIA
Declaration
I,Eshetufikedu, under signed declare that this senior research project is original work and has not
been presented for degree program in any university and all the source of materials used in the
senior research project has been duly acknowledged

Declared by
Full name ID NO

Eshetufikedu …………………………………………………………………………….078/06

Confirmed by the advisor

Name ………………………………………………………..

Signature ………………………………………………….

Date ………………………………………………………….

Confirmed by the examiner

Name ……………………………………………………….

Signature ………………………………………………..

Date ……………………………………………………….
TABLE OF CONTENT
CHAPTERONE……………………………………………………..…
1Introduction……………………………………………………………1

1.1Back ground of the study ………………………………………………………………….1

1.2Statement of the problem ………………………………………………………………..…2
1.1 Objective of the study ………………………………………………………………………3
1.3.1 General objective ……………………………………………………………………..3
1.3.2 Specific objective ………………………………………………………………...…3.
1.4 Significance of the study……………………………………………………………………...3
1.5 Scope of the study………………………………………………………………………….….3
1.6 Limitation of the study ………………………………………………………………………..3

1.7Organization of the study…………………………………………………………………..….4

CHAPTERTWO ……………………………………………………..…4
2.1 Overviews of human resource management…………………………………………………..4

2.2 Performance appraisal definition and meaning ………………………………………………4

2.3 Process of performance appraisal ………………………………………………………….…4

2.4 performance appraisal problem…………………………………………………………….…7

2.5 common appraisal problem…………………………………………………………………..10

2.6 Who should do the appraisal………………………………………………………………11

2.7 approaches to measuring performance …………………………………………………..… 13

CHAPTERTHREE……………………………………………………………......16
RESEARCHMETHODOLOGY……………………………………………….16
3.1ntroduction…………………………………………………………………………………..16

3.2 research design……………………………………………………………………………..16

3.3 population and sampling design………………………………………………………….…16

3.4 sampling design …………………………………………………………………………... 16

3.5 sampling selection technique and sampling size ……………………………….................. 17

3.6 source of data and data collection tools …………………………………………………….17

3.7 data analysis ………………………………………………………………………………...17

CHAPTRE FOUR………. …………………………………………………………………….18

DATA ANALYSIS AND INTERPRETATION……………………………………………...18

CHAPTERFIVE…………………………………………………………….……27
Summary of major finding conclusion and recommendation……………………………………27

5.1 Summary of major finding……………………………………………………………….….27

5.2 Conclusion ……………………………………………………………………………….…28

5.3 Recommendation ……………………………………………………………………………28

Reference …………………………………………………………………………………….29

Appendix
LIST OF TABLE
4.1 Back ground of the respondent …………………………………………………….…..….18

4.2 Formal appraisal process …………………………………………………………………...19

4.3 performance evaluated …………………………………………………………….…….….20

4.4 Conduct performance appraisal ……………………………………………………………..20

4.5 Approach used to measure performance ………………………………………………….…21

4.6 Communicate the purpose of performance appraisal …………………………………….….22

4.7 Purpose of performance appraisal ………………………………………………………...…22

4.8 Respondent on performance discussion ……………………………………………………..23

4.9 Criteria to measure performance …………………………………………………………….23

4.10 Awareness about organization objective………………………………………………...…25

Acknowledgement
Above all, thanks to almighty God for priceless help during the entire period of my life.
Secondly, I would like to extent my heartfelt thank to the ERA employees, for his contribution
process, especially the road transport officer Mr,Yohanes likewise, I would not escape from
expressing my special thanks to my advisor instructor AyalAdamu for supporting me in the
process of preparing this research paper by giving important ideas, constructive suggestion and
guidance.

Thirdly, my deepest and heart feltgratitude goes to my family to help me by supporting

financially and morally from the beginning until now to finish my BA degree in management.

Last but not list, I want to thank my, friends and dormitory members all those who have
contributed with their valuable ideas for the successful completion of this research paper.
Abstract
This study would aim to assess the performance appraisal practice of Ethiopian road authority in
wolkite branch. The main objective of the study was also to asses the performance appraisal
practice of Ethiopia road authority in wolkite branch and to recommend alternative solution for
the problem. The researcher distributes 39 questionnaires but was collected only 28. In this study
the researcher was used judgmental sampling method to select managers and sample random
sampling to select the respondents of the study. The study used both primary and secondary
source data in order to collect the information. Mostly the focuses were given to primary source
of data which is collected by questioner. After the data has been gathered, it was processed,
analyzed and presented. The data analysis was carried out by using tabulation and percentage
and the data described by the descriptive method. The target population of the study was both
managers ‘and employees of the organization. Therefore, to get accurate information the
researcher was used both qualitative and quantitative data regarding performance appraisal
practice’s in order to get relevant data of the organization.
CHAPTER ONE
INTRODUCTION

1.1 BACK GROUND OF THE STUDY

The success or failure of an organization is highly dependent up on effective and efficient
utilization of the resource, i.e. material resource, information resource and human resources.
However, the human elements are the most important of all the other resource to come up with
fruit full results.Therefore, it is human resource, which should stronglybe developed to get the
best out of the other resources. The human resource of any company represent the determinant
factor that has the capacity to inhibit or to enhance business development the continuity of the
organization and its continued growth and prosperity are assured only through human resource
development (Monday &mobiles 1991).

Human resource or manpower may be through as the total knowledge, skill, creative objectives,
talents and aptitudes of an organization work force, as well as the value, attitude and benefit of
individual involved. If the objective of HRM is to be accomplished, top managers will have to
treat the human resource of the firm as a key to effective ness. To do this, to accomplish the
importance objective of HRM, management must regard the development of superior human
resource as an essential competitions requirement that needs carefull planning, hard work and
performance evaluation (Ivancenich&Glueck, 1989).

Even though Performance appraisal of human resource occurs in most organization, often this is
a causal, subjective and infrequent activity, but increasingly manyorganizations have decided to
formalize the assessment process and used it to improve performance, assess training needs and
predict the potential of employees. Performance appraisal plays crucial role in importing
motivation at work and provides an opportunity for combination between those who assign work
and the person who perform it (wright, 1996).

Employees want and need feedback regarding how they are doing and appraisal provides an
opportunity for the manager to give them that feedback to meet the company’s expectation.An
organization performance appraisal must generate fair, accurate and valid information that can as
a round basis for organizational decision making regarding salaries, promotion, training and
development and so on.At the sometime appraisal must assist and encourage open sharing
information regarding employee development and motivation (wright, 1996)
Therefore the main purpose of this research paper is to assess the employee performance
appraisal practice in case of Ethiopia road authority wolkite branch.

1.2. Statement of the problem

Performance appraisal is one of the many responsibility of managers and if appropriate used it
contribution to the well-being and growth and development of the organization, promotion and
motivation of the employees and so on, but if abused or misused, it does affect not only the
working atmosphere of the organization in general but also it affect the morale of each and every
employee in organization. since performance evaluation is closely related to human behavior, it
is very sensitive and it has to be perform carefully and genuinely, since human behaviors is
complex and as performance appraisal to deal with this complexity of human nature it has to be
carried out consciously and constantly to serve the desired purpose (Robert &Jakson, 1997).Too
often performance appraisal of most organization faced with some problems such as the problem
of tails to reflect the actual performance, not provide performance feed, lack of document
criteria, no formal basis for personnel decision like salary increase, disciplinary action,the degree
of openness and trust between manager and subordinate and the like. Generalthere is also
problem relate to performance appraisal practice the appraisal on how to use the result in future
personnel action. Thereforethese researches wereconduct to asses practice and related problems
of performance appraisal by answering the following research questions:

1. For what purpose the organization use the result of performance appraisal?
2 What are the techniques used by the organization to apprise employees.
3 What are the challenges related to PA systems of the organization
4 Who is the responsible body that evaluates the employee’s performance?
1.3. Objective of the study

1.3.1. General Objective

The general objective of the study is to assess the employee performance appraisal practice the
case of Ethiopia road authority in Wolkite branch.

1.3.2. Specific objective

The specific objective of the study is as follows

1. To assess the purpose of performance appraisal.

2 To assess the criteria and techniques used to appraisal employees performance.
3 To identity the challenge related to performance appraisal system.
4 To identity the responsible body that evaluates the employee’s performance.

1.4. Significance of the study

At the end of the study, the results canbe used by Ethiopia road authority Wolkite branch
enhancing its performance evaluation practices. It helps the management to make the
necessary improvement to boost productivity by motivating employees and rewarding
high performance , the study also provide that accurate result of performance evaluation
increases the quality of decision made in the respect of human resource planning, training
development compensation program internal employee relation and assessment of
employee potential. It also used as a potential base data for further study on the same
topic by identifying the research gap.

1.5. Scope of the study

The coverage of the study was limited on the area which considers in the study on the employee
performance appraisal practice of Ethiopia road authority Wolkite branch.

1.6. Limitation of the study

Conductingeffective research requires many things. Time and money is among the basic
requirement. During conducting research, there was shortage of time. The time given for the
collection of data was not sufficient to collect the required information.

Even though the main sources of data for the research are through investigation of primary data
and; there is lack of latest supporting document for secondary data in the library. And also it was
difficult to get voluntary respondents to collect data from them.
 CHAPTER TWO
2. REVIEW OF RELATED LITERATURE

2.1 OVERVIEW OF HUMAN RESOURCE MANAGEMENT

Human resource management deals with human resource of an organization consisting of all
people who perform its activities. Beforeidle in to the detailed discussion regarding performance
appraisal, its important if gave brief definition of HRM. Many authors defined HRM from
different perspective

 Human resource management concerns the personnel policies and managerial practices
and system that in the fence the work force (Be rnardin, 2007).
 Another group of authors defined HRM as the policies, practices and system that
inferenceemployee’s behavior attitude and performance (Neo, 1999, 1996).

2.2.PERFORMANCE APPRAISAL DEFINITION AND MENING

Performance appraisal is the process by which a manage consultant

 Examines and evaluate an employees work behavior by comparing it with preset

standards
 Documents the result of the compassion and show where the improvements are needed
and why performance appraisal are employed to determine who needs what training, who
will be promoted, demoted, retailed or fired (monday 1999).Performance appraisal is
review and discussion on employee’s performance of assigned duties and responsibilities
the appraisal is based on result obtained by the employee in his/her job, but hot on the
employee’s personality characteristics. The appraisal measures skills and
accomplishment with reason able accuracy and uniformity. (Ibid)

2.3. PROCESS OF PERFORMANCE APPRAISAL

According to monday (1999) Performance appraisal is planned, developed and implemented
through a series of steps.

A. Job analysis
B. Establishing standard of performance
 C. Communication performance standards to employees
D. Measuring actual performance
E. Comparing actual performance with standards and discuss with employees
F. Initiating corrective action it necessary.

Detail Description of the Steps in Performance Appraisal Process

1. Job analysis, job description and job specifications performance appraisal is the process not
to be undertaken in isolations of various human resourcesfunction. It begins with job
analysis, job description and job specification. Thee helps in establishing the standard
performance
2. Establishing standard of performance: - appraisal system requires performance standard,
which serves as benchmarks against which performance is measured. The standard set for
the performance should be clearly defined and unambiguous. It should be attainable by
normal employee. To be useful, standard should relate to the desired result of each job
performance standard or goals must be developed by the supervisor to insure that all recant
factors have been on included. Where the output can be measured the personal
characteristics, which contribute to employee performance, must be determined. Goals
must be written down. They must be measurable within certain time and cost consideration.
3. Communications performance standard to employees: - performance appraisal involve at
least two parties the appraiser who does the appraisal and the appraise whose performance
is being evaluated the performance standards specified in the second step about are to be
communicated and explained to the employees (both appraiser and appraise) so that they
come know what is expected of them .feedback should also take to relieve of from any
confusion or misunderstanding. Feedback enables the manager that the information has
reached the employees. If necessary the standards may be revised or modified in the light
offeedback obtained from the employees and the evaluators.
4. Measuring the actualperformance:-after the performance standard are set and accepted, the
next setup is to measure the actual performance this requires choosing the right techniques
of measuring, in identifying and the internal and external factor inflecting performance and
couching information on results achieved.it can be affected through personal observation,
written and oral reports from supervisors. The performance of different employees should
 be so measured that it is comparable. Performancemeasures, to be helpful must be easy to
use, be reliable and report on the critical behaviors that determine performance.
Performance Measure May Be Objective or Subjective
A, objective performance measures: - measures are indication of job performance that
can be verities by others and are usually quantitative objective criteria include:
- Quality of production
- Degree of training needed
- Accidents in a given period
- Absenteeism
- Length of service etc.

B, Subjective performance measures: - measures are rating that are based on the personal
standard for opinions of those doing the evaluation and are not veritable be others subjective
criteria include.

- Rating by supervisors
- Knowledge about over all goals
- Contribution to socio-cultural values of the environment.
5. Comparing the actual performance with standard and discuss the appraisal with the
employees :-
Actual performance is compare with the pride remind performance standard. Actual
performance may be better than expected and sometimes. It may to affiancedeviations if
any from the set standards are noted. Along with the deviations the reason behind them are
also analyzed and discussed such discussion will enable an employeesto know his or
sheweakens and strength, weakness is discussed so that employee takes interest in
improving the performance he will be motivated to improve his or her self. The assessment
of another person’s contribution and ability is not an easy task.it has serious emotional
overtones as it affects the self-esteem of the appraisal.
6. Initiating corrective action, if any
The least step in the process is to initiate corrective action essential to improve the
performance of employeescorrective action two types
- The one, which put outs theirs immediately
- The other one, which strikes at the root of the problem permanently
 1.3.1 HOW TO DEFINE THE JOB

The Job description of ten is not sufficient to clarify what you’re subordinate to do this is
because most are written not for specific jobs but for groups of jobs. All sales managers in the
firm night have specific ideas regarding what you expect your sales manager to do. Forexample,
thejob description may list duties such as ‘supervise sales force ‘and ‘is responsible for all phases
of marketing the division products’. However, you may expect your sales manager to personally
sale at least 600,000 worth of product per year by handling the division two largest account; keep
the sales force happy and customers away from the executives including you.

2.4. Performance appraisal problem

According to Invancevich& Gluck (1989) there are various types of performance related
problem:

Unclear standard

Unclear performance standards are one problem an appraisal system that is to open to
integration, instead include descriptive phases that define each trait and what is meant by
standards like’’ good’’ or’’ for example, deferent supervisor would probably detine’’good’’
performance ‘’ fair’’ performance and so on differently. The same is true for trait such as
‘quality ‘of work or’creativity’.there are several ways to rectify this problems.

HALO EFFECT

In the performance appraisal, the problems that occurs when supervisors rating subordinate son
one trait biases the rating of that person on the other traiti.e. rating of subordinates on one trait
such as gets along with others biases how you that person on the other trait quality of work. This
problem often occurs with employees who are specially friendly and unfriendly toward the
supervisors. For example unfriendly employees will often be rated unsatisfactory for all traits
rather than just for the trait; gets along well with other ‘. Being aware of this problem is major
step towards avoiding it. Supervisory training can also alleviate the problem.
CENTERAL TENDENCY

If you use graphic rating scale this central tendency could restriction can distorts the equation
making then less use full for promotion, salary or consoling purpose. Ranking employees instead
of using graphic rating scale can avoid this problem because all employees must be ranked and
thus cannot all be rated average tendency is a tendency to rate all employees the same way, such
1up to7, they tend to

LENIENCY OR STRICTENESS

This is the problem that occurs when a supervisor has a tendency to rate all subordinate either
light or how. In fact, if you must use of performance that, say only about 10% of your employee
should be rated. Excellent’20%’ good’ and so on graphic rating scale, it might be good idea to
assume a distribution.

BIASE

Performance in one study individual defense among rates in terms of characteristics such as age ,
race, and gender can affect the rating they get, often quite apart from each rates actual for
instance, researchers found a systematic tendency to evacuate older rates. (Over 60 year of age)
‘Lower on performance capacity ‘and ‘potential for development‘than younger employees. The
race and gender can also affect the persons rating. However, here the biases are not consistently
against minorities or women, as it seems to be in the case of older workers. The employees
previous performance can be also affect the evaluation of his or her current performance.
Sometimes the rater may systematical overestimate improvement on the part of the poor worker,
for instance in some situation especially when change in behavior is more gradual the rater may
simply be insensitive to change in rates behavior

, Political behavior in performance e appraisal

According to Gerher(1996)usually people makes rating errors an intentionally, especially when

the criteria for measuring performance are not very specific training can reduce rating errors is
not the only cause of in accurate performance measurement. Sometimes the people rating
performance distort an evaluation on purpose to advance their personal goals.
These kinds of appraisal politics are unhealthy especially because the resulting feedback does not
focus on helping employeescontribute to organizations goals. High performing employees who
are rating unfairly will become frustrated and how performing employees who are over rated will
be reward rather than encourage improving. Therefore, organizations try to identify and
discourage appraisal politics. Several characteristics of appraisal system and company culture
tend to encourage appraisal politics.

Performance appraisals directly linked to high desirable reward to executive tolerate or ignore
distorted rating and senior employee tell new covers company “folklore” that in every
organization organization can minimize appraisal politics by establishing appraisal system that
is tearsome ways to promote fairness are to involve managers and employees in developing the
system. Use consistent standard for evaluation different employees, require that feedback be
timely and complete, allow employees to challenge their evaluation and communicate
expectations about performance standards, rewards and evaluation. The organization can also
help managers give accurate and fair appraisal by training them to use the appraisal process,
encouraging them to recognize accomplishment that the employees themselves have not identify,
and fostering a climate of openness in which employee feel they can be honest about their
weakness.

2.5. COMMON APPRAISAL PROBLEM

Some of the pitfalls to avoiding in performance appraise

- Lock of standard
Withoutstandard, there can be no objective evaluation of result, only a subjective
guess or feeling about performance
- Irrelevant or subjective standard

Standard should be established by analyzing the job output to ensure those standards are
job related.

-UnrealisticstandardStandardis goals with motivating potentials. Those that is reasonable but

challenging have the most potential to motivate.

-Poor measure of performance

 Objectivity and comparisons requires that progress towards standard or
accomplishment of standard be measured.
- Rater error
It includes rater biases or prejudice, halo effect, constanterror, central tendency and
Fear of confrontation.
- Poor feedback to employee
Standard and / rating must be communicated to the employee in order for the
performance evaluation to be effective.
- Negative communication
The evaluation process is hindered by communication of negative attitude such as
inflexibility, defensiveness and non-developmentalapproach.
- Failure to apply evaluation data; negates the primary purpose of performance
evaluation. The use and weighting of multiple criteria as well as the frequency of
evaluation also present problems.

2.6. WHO SHOULD DO THE APPRAISAL

- Appraisal by immediate supervisor

Supervisors ratings are the heart of most appraisal system this is because of getting a supervisor
appraisal is relatively easy and also make a great deal of sense. The supervisor should be –and
usually is –in the best position to observe and evaluate his or her subordinate’s performance.

- Using peer appraisal

The appraisal of an employee by his or her pears can be effective in predicting future
management success form the study of military offices, for example we know that peer rating
were quite accurate in predicting which officers would be promoted and which would not one
potential problem with peer rating is “logrolling“her all the peer get together or rate each other
high.

\
 - Using rating committees

Many employees use rating committees to evaluate employees these committees are usually
composed of the employees immediate supervisor and three or four other supervisor there is
several advantage to using multiple raters. While there may be discrepancy in the rating made the
different supervisors. The composite rating tend to be more reliable, fair valid those of individual
rating.

-Self rating

Some of employees self-rating of performance (usually in conjugation with supervisors rating)

the basic problem is that most study show that employee consistently rate themselves higher than
they are rated by supervisors are peers. Self-appraisal should be used carefully. Supervisors
requesting self-appraisal should know that their appraisal and the self-appraisal may accentuate
difference and rigidify position. Furthermore, even if self-appraisal is not formally requested,
each employee will enter the performance review meeting with his or her own self-appraisal in
mind and this will usually be higher than the supervisors rating.

- Appraisal by subordinates

More form currently late subordinate a anonymously evaluate their supervisor performance, a
process may called up ward feedback when conductedthroughout the firm the process helps the
managers diagnose managements actions with individual managers as required such subordinate
rating is especially valuable hen used for developmental rather than evaluative purposes
PERFORMANCE APPAISAL INTERVIEW TYPES

According to Invancvich& Gluck (1989) there are three types of appraisal interviewswith each
its own objective

- Satisfactory – promotable
In the interview the person’s performances is satisfactory and there is promotion
ahead. This is easiest of the three appraisal interview .your objective is discuss the
person’s career plans and to develop a specific action plans for the education and
professional development the person needs to move to the next job .
- Satisfactory – not promotable
 This interview is for the employees whose performance is satisfactory, but for whom
promotion is not possible.

-Un satisfactory –correctable; when \a person‘s performance is un satisfactory but

correctable, interview objective is to layout an action plan (as explained latter) for
correcting the unsatisfactory performance.

2.6. APPROACHES TO MEASURING PERFORMANCE

1. Graphical - mating scale

The most common form of attribute approach to performance appraisal takes graphic rating scale
the manager considers one employee at a time circling the numbers that signal show much of that
trait the individual has typically GRS assessments a technique which evaluate a person on the
quality and quantity of this work is the outstanding about average o unsatisfactory(beck &
wright1996).

2. Mixed standard scales

To create the mixed standard system we design the relevant performance dimension and then
develop statement representing good average and poor performance a long each dimension all
the actual rating mixed standard scale to instruments sate later is asked to complete the lasting
instrument by indicating either the employees performance is positive (t), at zero, or below G1
the statement (ibid).

3. Behavioral Mchored Rating Scale (Bars(Ibid)

BARS builds on critical incident approach the critical incident are placed along the scale and
assigned points values according to opinion of expert it is designed to specifically define
performance dimension by developing behavioral anchors associated with different levels of
performance i.e.anchors are attached to their job diminution and placed on the appropriate scale
according to values that the group assign to them.

4. Critical Incident

This approach requires managers to keeps, record of specific example of effective and in
effective performance on the part of each employee. Herein an example of incident gives a
specific feedback to employees about what they strategy by focusing on incident that best
support the strategy. (Ibid).

5. Behavioral Observation Scale (Bos)

Bos is vacillation of BARS like Bars, Bos is developed prom critical incidents ,Bos differs from
BARS in two ways first, rather than discarding arrange number of the behavior that exam life
effective or in effective performance, Bos use many of them to more specifically dentine all the
behavior that are necessary for effective performance . second difference is rather than assessing
which behavior best reflect an individual’s performance a Bos requires a manger to hare the
frequency with the employee has exhibited each behavior during the rating period (Ibid).

6. Behavioral Observation

Behavioral approach to performance appraisal attempt to detive the behaviors all employees
most exhibit to be effective in the job, it provide specific guidance and feedback for employees
about the performance expected of them

7. Management by Objective

Outcome appraisal instrument asks a manager to assess the result achieved by workers such as
amount for number of product produced the most relevant outcome approach is mboand
naturally occurring outcome measures,mbo is goal directed approach in which workers and their
supervisors set a goal together for upcoming evaluation period, the rating set agoal then
consisting of deciding to what extent the goal have meet. With a management be objective
approach worker objection often can easily be adjusted at the beginning of new evaluation
period. (Ibid)

8. Organizational Behavior modification

Obm entails managing the behavior of employees through system of behavioral feedback and
rein forcemeat this system builds on behaviors is determined by past behavior that have been
positively rein forced. The techniques very but most have for comports:

- They define a set of key behaviors necessary for job performance

- They use a measurement system to assess whether those behavior are exhibited
 - The manager or constants inform employees of that behavior perhaps each setting a goal
for how often the employees should exhibited those behavior
- The manager or consultation inform employees of that behavior perhaps even setting a
goal for how often the employee should exhibited those behaviors
- Finally feedback and reinforcement are provided to the employee (Ibid)

9. Assessment center

Processing which multiple raters evaluate employee’s performance in a number of exercise, it

provide somewhat objective measures of an individual’s performance of managerial task (Ibid).

10. Paired Comparison

- it requires managers to every employee with every other employee in the work group giving on
employee a score one every time he/she is concerned the higher it is an appraisal that use
performer once all the pairs have been compared, the managers computers a number of time each
employee received the favorable decision (count up points0 and this because employees
performance score the paired comparison methods fends to be an increased spent control.

11. 360 Degree Appraisals

It is appraisal that use input from managers, supervisor subordinates, peers customers even set
appraisal including other.

12. Psychological appraisal

Large organization empty fulltime industrial psychologists when psychologist are used for
evaluations they assess an individual future potential and past performance the appraisal
normally consist of in depth interview, psychological test, discussion with supervisor and review
of other evolution(French, 1998).
 CHAPTER THREE
3. RESEARCH METHODOLOGY

3.1 INTRODUCTION
Research methodology is plan of action which links methods to outcomes, governs our choice
and use of methods (Creswell, 2003). Research methods or techniquesrefer to the methods a
researcher use in performing research operations. In other words all those methods which are
used by the researcher during the course of studying the research problem (Kothari 2004). This
section clearly illustrates the research design, a sampling technique adopted, types of data
observed and collected to the paper. Furthermore, target population and method of data analysis
that employed was presented.

3.2 Research design

According to Kothari (2004) a research design is the arrangement of conditions for collection
and analysis of data in a manner that aims to combine relevance to the research purpose with
economy in procedure. To achieve the stated objective, the study used descriptive research
design. The objective of descriptive researchis to portray an accurate profile of persons, events or
situations. Besides these,the study also used both quantitative and qualitative research approach
to examine a stated objectI’ve. According to Kothari (2004) quantitative research approach
involves the generation of data in quantitative form which can be subjected to quantitative
analysis in a formal and rigid fashion. In this study because of taking the data from samples only
once that a cross-sectional survey design was applied to assess the practice of performance
appraisal.

3. 3.Population and sampling design

The target population of the study wasmanagers and 62 employee of the branch. Therefore the
total population of the study was 64 employees of road authority wolkite branch.

3.4.Sampling design
Sample design is made up of two elements. Sampling method refers to the rules and procedures
by which some elements of the population are included in the sample. Some common sampling
methods are; sample random sampling, cluster sampling and the estimator. The estimator process
for calculating sample statistics is called the estimator. Inthe study the researcher was use
judgmental technique to select the respondent and questioners were used distributed for
therespondent. From the target population the researcher was used to select the respondent from
managers for interview purpose

3.5.Sampling Selection technique and sample size

From the total population which is found currently at Ethiopian road authority wolkite branch,
the researchers were select 39 employees of the organization as a sample size. According to
Yamane (1967) sample size determination formal

n=n/1+N (e) 2 where

n =64/1+64(10%) 2 e= error probability

n =64/1+64(10%) 2 n= sample size

64/1+0 64 N = total population

64/1.64

=39

3.6. Source of data and data collection tools

The researcher was used frequency it helps of primary and secondary data.The primary data were
used collected through questionnaires from employees and interview from managers to collect
information about the practices of performance appraisal.

3.7. DATA ANALYSIS

The researcher was both qualitative and quantitative data analysis techniques.Quantitative data
were analyzed on the form of table and percentage. And qualitative data were also described and
discuss through the content analysis.

Chapter four

4.DATA PRESENTATION, ANALYIS AND INTERPRETATION

4.1. Introduction
In this chapter the data obtained through questionnaire were used for analysis.39 questionnaire
Were prepared and distributed, out of these only 28 questionnaires or 71.8% of respondent filed
and returned the questionnaire. Result of knowledge and opinion of the respondents are tabulated
and interpreted. Problem on different aspect of performance appraisal system are indicated.
4.2. Demographic data of the Respondents

This section of the analysis describes respondent’s demographic profile in terms of gender, age,
educational status, year of experience.
Table 4.1.Demographic background of the respondent

Respondent Percentage
1 sex Male 23 82%
Female 5 18
Total 28 100%
2 educational Grade 12th completed 0
status
Technical and vocational 7 25%
school
Diploma 7 25%
First degree and above 14 50%

Second degree and above 0

Total 28 100%
3 year of Less than 5 years 10 36%
experience
5 up to 10 years 0

10 up to 15 18 64%
15 above - -
Total 28 100%
Sourcesurvey or study result 2016

According to the data presented on the above table,

82% of employees are male. While the rest of 18% are females.This shows that in this organization, a
male seems to be given priority Both ,have second degree and majority of employees (50%) have
first degree , while the remaining 25% of employees possess diploma level .From this we can
conclude that the organization employees are well educated.. Regarding year of experience,
100% of managersand 64% of employees have been working in the organization for more than
11 years. The remaining 36% of the employees working in the organization for less than 5 year
this tells us that majority of employees have sufficientknowledge and experience regarding the
entire organizational activities

4.3. Descriptivemeasurement of data

Table 4.2 –response on formal appraisal process

4. Is there any Respondents Percentage

formal
performance
appraisal practice
in your
organization?

Yes 28 100%
No - =
Total 28 100%
Source; surveyor study result 2016

Table 4.2 indicates that full response of formal appraisal process.

The entire respondents agree there is formal appraisal process in the organizatioGenerally
researcher in this organization an employee’s performance is evaluated on regular basis or
procedure and the organization has planned way of letting the employees to know where they
stand and how they were progressing.
5. How often option Employees Percent
is your
performance
evaluated is a
year?
Once a year - -
Twice a year 28 100%
Three times - -
Four times - -
and above
Total 28 100%

Source, survey or study result 2016

As depicted in table4. 3, every employee, percentage confirmed that in their organization

performance appraisal activities are held semi-annually or twice in a year.

This shows that the organization is ready to know the strength or weakness of the employee’s
performance frequently and the raters spent much of their time conducting evaluations time
which and completing forms at one time which may lead them to want ‘’ get it over which
‘’quickly

Table 4.4 Responses on who does conduct performance appraisal

6. in your employees Percent

opinion who
should
evaluate
employee‘s
performance?
Option Director 20 71%
Division - -
manager
Immediate 8 29%
 supervisor
Subordinate - -
Total 28 100%
Source, survey or study result 2016

As shown in the table 4.4 71% of employees respond that performance appraisal practice was
done by director and only 29% of employees argue that the appraisal practice is through
immediate supervisor.

This shows that in ERA, the responsibility for appraising employees is given to director and
immediate supervisor in reality having only one rater is not appropriate for the organization
because the rating result is exposed to bias as a result of subjective evaluation techniques. Often,
eliciting performance information from a variety of source results in performance management
process is relatively accurate and effectives,thus having multiple raters like managers, peers,
self-subordinate, etc… provide a means for minimizing bias in otherwise subjective evaluation
techniques may be occurred

Table4. 5- Response on approach used to measure performance

7. Which Option Respondent

appraisal
techniques
dose the
organization
use to
evaluate the
employee’s
performance?
Respondents Percent
Graphical 6 21.4%
rating system
Critical - -
incident
 Mixed - -
standard scale
Ranking - -
methods
Paired 22 78.6%
compassion
Total 28 100%
Source, survey or study result 2016

Regarding the approach used to measure the performance , 78.6% respondents said that paired
compassion techniques used to measure employees performance and 21.4% of respondents said
graphic rating system that how they performance is used .

Generally, this organization comparative approach and focus on the performance of individual
employees.

The comparative approach to performance measurement is an effective tool in differentiating

employee performance.

Generally speaking these techniques lack specificity for feedback purpose .based on their relative
rankings, employees, are completely an aware of what they must be differently to improve their
ranking. Instrument itself and it also became extremely time consuming and cumbersome

Table4. 6- Response on communicating the purpose of performance appraisal

 8. Do you
communicate
the purpose
of
performance
appraisal by
the
organization?
Respondent Percent
s
Yes 18 64%
No 10 36%
Total 28 100%

Source. Survey or study result 2016

As show on the above table, 64% respondent said hat, sometimes but yes there is communication
between the rater and the rates about the purpose of performance appraisal. While the rest 36%of
respondent says, there is no communication about the purpose of performance appraisalbetween
the rater and the rate.

This shows that majority of employees they know for what purpose that is performance appraisal
conducted in their organization.

Table4. 7- Responses on purpose of performance appraisal

9. for what Option Respondents
purpose does the
performance
evaluation result
used in your
organization?
Respondent Percent
Salary -
incremental
Promotion 4 14.3%
Reward purpose 3 10.7%
Training purpose 21 75%
Total 28 100%

Source.Survey or study result 2016

As indicated in the table, fromemployee’s perspectives 10.7%, 14.3% and 75%responded that the
purpose of performance appraisal in their organization is for rewarding, promoting and training
respectively.

Table4. 8- Response on post-performance Discussion

10. Do you Option Respondent

openly discuss
the performance
result with your
evaluators?
Respondent Percent
Yes 16 57.1%
No 12 42.9%
Total 28 100%
Source.Survey or study result 2016
Regarding table 4.8, 57.1% of employees respond that there is post appraisal discussion in their
organization, while the remaining 42.9% of employees confirm that there is no discussion at all
on the appraisal result.

This tells us the employee cannot know whether they are strong or weak at their performance and
the performance evaluation result are the kept secretly in the organization.

One of the main purposes of conducting performance appraisal is to give feedback on workers
performance.in the absence of such feedback employees do not know how they are assessed on
different aspects of their work and they perceive that their appraiser conspires on them and lack
confidence in the appraisal system as a whole.

Table4. 9- Responses on criteria to measure performance

11. Do the
criteria used by
the organization
to evaluate
employee
performance are
appropriates or
relevant?
Respondent Percent
Yes 15 53.6%
No 13 46.4%
Total 28 100%
Source.Survey or study result 2016

From the above table, 53.6% ofrespondent agree that the criteria used to evaluate performance
are appropriate or relevant. (46.4%)says the criteria used evaluate employee’s performance are
in appropriate or irrelevant.

The criterion of performance appraisal is a key element in the appraisal process. Since the
criteria are used to assess the performance of employees these criteria must be clear for both
appraiser and appraise
12. Employees comment on appraisal criteria

The employees who said that the criteria are inappropriate give the following comments.

 The criteria is not objective i.e., it is not quantifiable and verifiable and it is difficult to
measure.
 Subjective measure must be removed because it is not quantified and largely dependent
on the opinion of observers and it have a potential to dilute the quality of workers
evaluation result because they may be influenced by bias or distortion as a result of
emotion.
 There are evaluation criteria which are unrelated to employees work and must be
removed.
 The criteria are not capable of differentiating among employees according to their
performance.

13. Employees ‘response on rater’s error in performance appraisal

Completely error free performance appraisal may be an ideal but in reality, most appraisal fall
short of this ideal. This is often due to one or more actions that can significantly impede
objective evaluation. Even if the system is well designed, problems can arise because of the rater
error.

According to Ethiopia road authority the response of respondent there is various errors that the
rater commits.

 Rating every employee’s averagely even employees who has good performance rate
equally with other employees.
 Absence of feedback after the appraisal process
 Sometimes the rate compares employees present performance with the past performance
 The rater give high rating for the workers who have good with him

Generally speaking, from the above response we can conclude that the rater
committeestheerror like central tendency error and bias is widely seen in this organization.

14. Employees’ suggestion towards appraisal problems

 Most of employees are not satisfied in the appraisal process of ERA and give suggestions
towards improvement of appraisal practice.

 Provide timely and complete feedback in an atmosphere, of respect and courtesy.

 Communicate expectations regarding performance evaluations, standards and
rewards.
 Minimize rating error and biases by providing training for the rater.
 Establishing consistent standards when evaluating different employees.

As peer indicated on the above 10, regarding the awareness about the organization goal and
objective as result of performance appraisal,50% employees respond that pehave high value and
50% of employees said, it have moderate value for ERA to achieve its objectives and goals.

4.4. Analysis of Managers Interview

The researcher had made interview with the manager of the Ethiopia road authority wolkite
branch; they said that in their office there is performance appraisal twice a year using different
ranking giving method to identify their performance. Some of the obstacles that their office is
faced during feedback are responded to the employees. This is lack of budget, lack of material
and to not receiving the result after the appraisal is performed.
 CHAPTER FIVE

5. Summary, conclusion and recommendation

5.1 summary of major finding

According to the information gathered, based on the analysis the following finding described.

 All respondent agree that there was formal appraisal practice in the selected organization.
 respondent confirmed that on their organization performance appraisal activities are held
semiannually or twice a year
 Majority of employees (75%) said that the purpose of appraisal is training purpose.
 In ERA performance evaluation is mainly used for administrative purpose and strategic
purpose such as to link employee’s activity with the organization goal and development
purpose i.e. rewarding employees who are outstanding in their performance and
providing training program for whom perform below their performance.
 respond that there is no discussion ( 42.9 %)of employee appraisal result at all
 In the appraisal process (32.1%) of employees does not participate.
  ERA used paired comparison method to measure employee’s performance 78.6% of
employees
 Majority of employees (46.4%) says that the criteria used to evaluate employee’s
performance are in appropriate or not relevant.
 Most employees respond that the rater committees central tendency error, contrast error
and bias when appraise employees performance.
 respondent that there no appraisal interview in their organization
5.2. Conclusion

Competent appraisal of individual performance in an organization or company serves to

improve the overall effectiveness’ of the organization.

 Effective appraisal contributes to wellbeing and growth of organizational and

development, promotion and motivation of employees inhabiting these organization.
 But, if abused or misused it does affect not only the working atmosphere of the
organization.in general, it also affects the morale of each and every employee’s in the
organization.
 ERA operated performance review scheme as indicated in chapter four of the data
interpretation and analysis part the organization performance appraisal scheme
largely exposed to issue such as subjective performance rating, bias and favoritism,
secrecy of evaluation results, absence of feedback on the employees’performance.
Therefore researcher conclude that
 The use of inappropriate criteria which is not clear for the employee is the major
persistent problem in appraisal system of the organization.
 The study result shows that the main purpose of appraisal is not to find fault with
employees and deprive them of some benefit rather it is used to understand
employee’s weakness and problem and indicate to them the mechanism of improving
their efficiency.
 Performance appraisal is about managing and improving performance, it is not about
completing
5.3. Recommendation
As per the data analysis and conclusion, the researcher gives the following
recommendation which help the organization to have more effective appraisal system.

 Only conducting performance appraisal on regular bases is not enough for the
organization without going through appraisal process.
 Employee should participate in appraisal process. One way for employee to
participate in appraisal process is designing the appraisal system with supervisor.
 Post-performance discussion should be conducted. An appraisal is incomplete
without discussing the result with the employees. Without feedback the appraisal
become an administrative exercise in filling out forms.
 The management should develop standard and criteria for varies job types at
every level of the organization through detailed job analysis. The organization
should use multi raters in order to reduce appraiser beperformance

APPENDIX
wolkite university

College of business and economics

Department of management
Dear respondent

My name is eshetufikedu. I am undergraduate student of wolkite University College of business

and economics. Here below, there questionnaire having the purpose of ‘’ assessing the employee
performance appraisal practice in case of Ethiopia road authority wolkite branch ‘’ for the partial
fulfillment of the requirement bachelor of arts (BA) in management. Hence, I would be grateful
if you kindly take a few minutes of your time to fill out this questionnaire putting your personal
experience with regard to the issue. Your willingness and cooperation in giving genuine
information is will appreciated and the information you provide will be used for academic
purpose and will be kept in strict confidentiality. If you would like to gain further information
about this study, of have a problem in completing the questionnaire, please contact me via +251-
916886076
General instruction:
1. Dear respondent you are not required to write your name to give, you have a freedom to
respond confidently and to keep you secret safely.
2. Please put ‘’ ‘’ mark in the please provide for you in box and if you have additional
information specify it in the space provided under each questions.
3. If the prepared space is no enough, you use the back page of the pa
Part one: respondent’s biographical data
1. Sex A. male B. female
2. Education A. Grade 12th completed B. Technical and vocational school
certificate C. Diploma D. First degree and above
3. Year of experience:
A. Less than 5 year B. 5-10 year C. 11-15 year D.16 above

Part II. Work related data

4. Is there a formal appraisal process in your organization? A. yes B. No

5. If your answer is yes how often do you evaluate your employee’s performance?

A. Once a year B. Twice a year C. three time a year D. Four times and above

6. in your organization who does usually evaluate employee performance?

A. Director B. Divisional manager C. Immediate supervisor D. Peer

 Other if any ---------------------------------------------

7. Do you communicate the purpose of performance evaluation to the employees?

A. Yes always B. Yes sometimes C. Not at all

8. for what purpose does the performance evaluation result used in your organization?

A. Salary incremental B. Reward purpose

C. For training purpose D. I do not know

9. Do you openly discuss evaluation result with the employees?

A. Yes always B. Yes sometimes C. Not at all

10. do you workers show positive attitude or motivated in the appraisal process?

A. Yes always B. Yes Sometimes C. No at all

11. Which appraisal techniques do you apply to evaluate the employee’s performance?

A. Graphical rating system B. Critical incident C. Mixed standard scale

 D. Ranking methods E. Pared comparison

12. Do you think the criteria used to evaluate employees performance are appropriates or
relevant? A. Yes B. No

13. If your answer is no give your comment toward appraisal crieteria of your organization?

---------------------------------------------------------------------------------------------------------------------
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14. Are there any mistake by the rater during performance appraisal (please explain?
---------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------

15. What do you suggests for the program related to performance appraisal in your organization?
------------------------------------------------------------------------------------------------------------

16. Is there appraisal interview in your organization?

A. Yes B. No

17. To what extent do you think ERA achieved its goal and objective as a result of its
performance appraisal practices?

A. To very high extent B. To high extent c. moderate D. lo

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 Robert, M. (1999-1996). Human resources management. 7thed olifion
 Wendell, L. & French. (1998). human resources management, 4th edition
 Wright.(1991,1996).Human resource management. 3rded
 Yamane, (1967). statics an introductory analysis, 2nd edyuouc