THE IMPACT OF EMPLOYEE PARTICIPATION IN DECISION MAKING AND ORGANIZATIONAL PRODUCTIVITY (A CASE STUDY OF SKYE BANK PLC, ERUWA)
This study has examined the impact of employee participation in decision making and organizational productivity. Skye Bank Plc, Eruwa, Oyo State was used as the case study. The population consisted of 30 staff of Skye Bank, Plc, Eruwa and 66% of the target population was sampled. Questionnaire was used to obtain responses from some respondents. The Study made it clear that Participative decision making does not involve participation at all levels of management, there is a positive relationship between participative management and productivity i.e to say participative management results in increased productivity. Indeed participative management should be seen as an inevitable tool in any organization both public and private. The following recommendations were also put forward; Managers should put more efforts in encouraging their employees to contribute to decision making and incorporate them into the organizational policy, Managers should allow increased level of workers participation in decision making since they are the centre of operations and can say better on issues bearing on those areas.
1.1 Background of the Study
Decision making is shared at all levels of management. It is observed that decision making in Japanese firms are focused on defining questions or issues rather than on finding solutions. Thus all levels of the organization are involved in this process. In the United States, industrial democracy is practiced, employees are encouraged to buy shares in companies thereby enabling them to have a say in the management of their organization. In other developed countries like Britain, Yugoslavia and Germany, participatory management is popular. In Britain and Yugoslavia, it is known as joint consultation and self-management respectively while in Germany, it is known as co-determination.
In Nigeria, participatory management has come a long way. The Nigeria Military Government in 1977 decided to democratize industrial ownership in Nigeria by promulgating the Nigerian indigenization decree part of which provides “that 10 percent total equity share of any enterprise on schedule, 2 and 3 should be reserved for workers”. This is to ensure that workers have a sense of belonging in their respective organizations.
Both the state and Federal government of Nigeria have in the past involved its citizenry in the management of affairs of the state. Ejiofor and Aniagor (1984) stated that the state represents both enterprise and workers and other social and economic institutions. Based on this argument, the researcher sees the state as representing management while the citizenry represent workers. Everybody is working for the state because everything you do, be in the private or public sector, is contributing to the national development. It is in recognition of the significance of participation that the federal military government of Nigeria sometime invited the entire citizenry to participate in deciding whether Nigeria should accept the IMF loan or not. After a heated debate by “well meaning” Nigerians, the idea was cancelled.
Apart from the Federal and State government being aware of the need to involve citizens in the management of affairs of the state, many companies in Nigeria mostly the multinationals are practising participative management A.G. Leventis, United African Company (UAC), United Trading company and John Holt call it consultation committee. Suggestion boxes and
House journals are means through which employees are represented on the Board of Nigeria Ports Authority.
Despite these evidences of the existence of participative management in the Nigerians industrial set up, some people in other countries and some Nigerians are of the view that real participatory management does not exist and cannot exist due to under development, inexperience in democratic process, political instability and economic instability caused by frequent changes in economic policy by the federal government. Participative decision making can be well practiced only in a stable economic environment because of its time consuming nature and investment in training to enable workers have a contributing capacity. Also the negative attitude of the Nigerian worker to work does not encourage participatory management. They are more interested in what they will get from the employer in terms of salaries and other employment benefit and not the job itself. Such attitudes definitely cannot give rise to effective participation.
Organization productivity is determined by a broad range of factors, some can be evaluated quantitatively, while others require a qualitative, analytical approach. When assessing productivity, it is important to fully understand each of the key drivers that impact productivity. In addition to evaluating each driver individually, it is necessary to determine how well these drivers work together and function as a whole. Changes to one driver might (and probably will) have an effect on others. Effective Assessment involves understanding how each driver contributes to overall productivity.
1.2 Statement of Problem.
The issue of whether participative decision making exists in the Nigerian industrial set-up is very controversial. Some companies in Nigeria practice participative decision making and the government has in the past encouraged participative decision making through legislation. On the contrary, some management writers in Nigeria are of the opinion that it does not exist and where it does it is not real. Their reason is that the necessary prerequisite conditions to encourage participation in Nigeria are not available.
However, research into leadership style has exposed employee’s desire for involvement in decision making in their various organizations. Employees are at the same time important elements of the accomplishment of the organizational goals, and thus organizational survival. The reason basically rests on the fact that employees are operators and are in better position to know the problems they encounter in doing a particular task and how best to solve them.
The problem mainly lies on the fact that participation though obtained has not been clearly understood as well as its benefits. Some of the managers feel that the decision making process is their sole prerogative and as such should be protected. Again top management likes to remain aloof from its employee as to build an all important air around themselves.
In the light of the above, this study therefore examines the extent of practice of participative decision making in government Press and few other firms and its influence on productivity as well as ascertaining the benefits and problems arising from such practice.
1.3 Research Objective
The broad objective of the study is to examine the impact of employee participation in decision making and organizational productivity.
While the specific objectives are:
i. Examine the perception of workers towards participative management policy in an enterprise.
ii. Ascertain the level of workers participation in decision making of the organizations.
iii. Verify if employees opinions are made use of after being collected.
1.4 Research Question
? To what extent does employee opinion made use of management in decision making?
? To what extent does employee participation in decision making affect the organizational productivity?
1.5 Significance of the Study
This study is designed to provide information to the public on how Skye Bank Plc, Eruwa have faired in their practice of participative decision making and its contributions to productivity, thereby enhancing organizational efficiency. It is expected that this study will be beneficial to the management by giving enough insight into the benefits of employee participation in decision making, make clear to managers what participative management stands for hence, reducing the fear often harboured by these managers. Workers, students of business Administration and the society at large are equally the potential beneficiaries of this study.
It is equally my hope that the study would provide a basis on which further research could be carried out.
1.6 Scope of the Study
This study is about participatory management. The extent of employee participation in decision making and organizational productivity, the effect on satisfaction and productivity of employees and the problems encountered in its practice will be examined. The study cover all the staff of Skye Bank Plc, Eruwa.
1.7 Limitation of the Study
The Study is thereby limited to Skye Bank Plc, in Eruwa. This is due to limited time and finance being faced by the researcher.
1.8 Definition of Terms
Employee/Worker: For the purpose of this study a worker is taken to mean any person who has undertaken to place his gainful activity in return for a remuneration, under the direction of another person who may be an individual, a private or public company or a corporation, who is styled the employer. (Akpala 1990)
Productivity: The output per unit of a factor of production is called the “productivity” of that factor. Imaga (1996)
An organization’s ability to transform inputs to output at the lowest possible cost is its productivity, Unamka & Ewurum (1995).
Participation: This will be regarded as the process by which people contribute ideas towards the solution of problems affecting the organization and allied matters.
Employee Participation: This will be taken to be when those below the top of an enterprise hierarchy take part in the managerial function of enterprise.
Decision Making: This could be taken to mean an art considering and making a judgment concerning a particular issue or issues.