REVIEW OF RELATED LITERATURE
This chapter review the literature on topic “Human Resource Management and Productivity in Nigeria Public Sector”. This review is subdivided into: Concept of Public Sector, Nigeria Public Sector, Brief History of Nigeria Public Sector, Characteristics and Classification of Public Sector, Human Resource Management in Public Sector, Impact of HRM on Productivity in Public Sector, Challenges of Human Resource Management in Public Sector
2.1 CONCEPT OF PUBLIC SECTOR.
Public Sector Organization can be defined as an organization that is set up as a corporate body and as part of the governmental apparatus for an entrepreneurial or entrepreneurial-like objective (Longman Dictionary). Public Sector Organization is organization which emerged as a result of government acting in the capacity of an entrepreneur (Obikeze and Anthony 2004:248). Public Sector Organization (also known as public corporation) is defined by Otobo and Omole (1981:69) as publicly-owned enterprise that has been chartered under federal, state or local government law for a particular business or financial purpose. According to Pfiffner (1964:40) “A corporation is a body framed for the purpose of enabling a number of persons to act as single person.”
Public Sector Organization essentially has the features of several individuals who act as one. The Sector Organization thus is viewed as an artificial person who is authorized by law to carry, on particular activities and functions. It is described as a corporate body created by the legislature with defined powers and functions and independently having a clear-cut jurisdiction over a specified area or over a particular type of commercial activity. Public Sector Organization is part of government apparatus and three implications are hereby highlighted. First, a public sector organization, by virtue of its intricate relationship with government, is an instrument of public policy and its primary mission is in connection with governmental objectives and programmes. It is therefore naturally under governmental control. Second, a public sector organization, by its nature, mostly manages public resources, especially public money and this means that attention must be paid to mechanisms for enforcing accountability.
Third, the combination of financial and economic objectives with social and political aims invariably makes it difficult to devise appropriate performance measurement instrument. The Public Sector, sometimes referred to as the state sector, is a part of the state that deals with the production, delivery and allocation of services by and for the government or its citizens, whether national, regional or local/municipal. The organization of the public sector (public ownership) can take several forms, including:
• Direct administration funded through taxation; the delivering organization generally has no specific requirement to meet commercial success criteria, and production decisions are determined by government.
• Publicly owned corporations (in some contexts, especially manufacturing, “state owned enterprises”); which differ from direct administration in that they have greater commercial freedoms and are expected to operate according to commercial criteria, and production decisions are not generally taken by government (although goals may be set for them by government).
• Partial outsourcing (of the scale many businesses do, e.g. for IT services), is considered a public sector model.
In spite of their name, public companies are not part of the public sector organizations; they are a particular kind of private sector Company that can offer their shares for sale to the general public. The public sector is any business which is owned by the country as a whole and run on behalf of the people. Some public sector enterprises are run by the federal government, other known as municipal undertakings, are run by local Government Authorities. Although the government or local authorities run and control public sector business, they are owned by the country. The finance for public sector businesses is found by federal, state and local government and their aim are to give service either for the people of the country as a whole or for those who live in the local government authority area.
2.2 NIGERIA PUBLIC SECTOR
The concept and structure of what is today known and operated as the Nigerian public service sector of the entire economy has been premised on the nation’s public administration system based on its colonial experience. Thus, what constitutes the public service sector in Nigeria is one of the legacies bequeathed to the country at its independence. The sector has largely remained a semblance of what obtains in the context of colonial master’s home politico-economic model of running public undertakings. The public service is that sector of the economy owned and controlled by the governments of the federation or their agencies. It is a sector which is expected to serve all the citizens and it is funded and administered from and by the public resources. Essentially, the Nigerian public service sector, according to Otobo and Omole (1981) and MAMSER (1987) is economically divided into three categorizations:
1. The Civil service: This category can be identified as the federal, state, state ministries as well as the local government councils.
2. The institutions of learning, research institute and other allied systems.
3. The parastatals: These are Federal and State corporations like the Nigerian Railway Corporation, Housing Corporation, Port Authorities, Air and Sea, Crude oil and Solid mineral Ventures and Transportation undertakings. Others include the Power Holding Company of Nigeria, Water Corporation, Nigerian Television Authority (NTA), Federal and State Radio Corporations, The Nigerian Postal Service (NIPOST), Federal and State Waste Management Board; the Banking industry, among others.
These parastatals are supposed to provide certain essential services to members of the public even if they are unable to make profits or at least break even. The public enterprises are businesses set up to make profits and they must operate fully as commercial enterprises. Some of these enterprises are owned wholly by the governments and in other cases the governments have the majority or minority shares as the case may be.
Presently, as opined by Otobo and Omole (1987), the Nigerian Public Service Sector, when compared to the private sector of the economy, constitutes various categories of employees requiring varying skills in level and content as regards their job holding. Thus, the employees in these categories form the largest number of those employed in the country. As would be expected, they should constitute area of interest in the field of organizational study or discourse of what happens in the work. In this wise, the development and the acquisition of skills at the required levels by all workers in the public service sector becomes a study target as it obtains in this paper. It should be noted, however, that the public service sector is growing in nature and scope by the day, in response to the immediate and external socio-political and economic developments, especially in the content and context of the globalization trends and Millennium Development Goals (MDGs).
For this public sector to meet their increasing responsibilities, they require responsive and well equipped workers in terms of necessary knowledge, attitudes and adequate skills to enhance their on-the-job behaviour for effective and efficient service delivery on the parts of their employing public sector units (Oladunni 1998). This, he opines, could be better realized if the Nigerian tertiary institution, particularly the universities and professional associations such as the Chartered Institute of Personnel Management of Nigeria (CIPMN), the Nigerian Institute of Management (NIM), Administrative Staff College of Nigeria (ASCON) and a host of others, focus more seriously on the training and development of Human Resource Practitioners who will in turn train and develop the Nigerian public sector employees of all categories. It will be in form of training-the –trainer model for human resource skills provision by making such trained trainers professionals in the area of skill development in the proper sense of it. This responsibility rests squarely on the organization based Human Resource Development managers and their outdoor professional counterparts (consultants).
2.2.1 The Nigerian federal civil service context
Prior to 1988 reforms, the civil service in Nigeria was organized strictly according to British traditions (Ademolelekun and Gboyega, 1979), apolitical, bureaucratic and conservative, which made the structure an ossified system. The roots of the Nigerian civil service can be traced to the colonial civil service established by the British to govern Nigeria, as a colonial territory (Olowu et al., 1997), in 1861. However, it was not until 1914 (amalgamation of the northern and southern protectorate) that there was a unified governmental structure in Nigeria and that year marked the beginning of a Nigerian civil service (Olowu et al., 1997). The system remained in place after independence in 1960. Up to 1988, there were three major categories in the civil service within the framework of 17 point Unified Grading and Salary Structure (UGSS) that was adopted in 1975. Olowu et al. (1997) identified the grade levels structures as junior staff (01 -06), senior staff (07 – 12) and management staff (13 – 17), and in 1988, as part of the reform, a fourth tier structure was adopted by creating a directorate cadre (15 – 17) of the management cadre. The later now include officers on posts graded GL 13 – 14.
The Nigerian civil service has been undergoing gradual and systematic reforms and restructuring since May 29, 1999 after decades of military era (Babaru, 2003). The military ruled Nigeria between 1966 and 1979; and between 1984 and 1999. As part of the reforms, section 153(1) of the 1999 constitution of the federal republic of Nigeria has vested in the Federal Civil Service Commission (FCSC) the powers to appoint persons to offices in the federal civil service and to dismiss and exercise disciplinary control over persons holding such offices. The commission comprises a chairman and fifteen com-missioners who are appointed by the president subject to senate approval. Appointments into the federal civil service are done through recruitment, transfer and secondment (Babaru, 2003). Recruitment is the filling of vacancies by appointment of persons not already in the federal civil service (FRN, 2000: Rule 0228), transfer is permanent release of an officer from one schedule service to another or within the same service, while secondment refers to the temporary release of an officer to the service of another government agency or international organization of which Nigeria is a member for a specified period (FRN, 1998:). Section 170 of 1999 constitution empowers the commission to delegate any of its powers and functions in order to guard against possible delays and allow for the devolution of administrative powers in view of the crucial role the commission is expected to play as a regulatory authority of the federal civil service. Though the commission delegates powers to ministries and extra-ministerial departments to recruit junior staff to posts graded GL 01 – 06, it has the reserved right to exclusively appoint the entry grades of senior staff on GL 07 – 10. Appointments to posts graded GL 12 – 14 are done directly by the commission after due advertisement as the need arises and appointment of directorate staff, which is GL 15 – 17 is made by the commission in consultation with the head of the federal civil service and in response to advertised vacancies (FRN, 2000: Rule 12102).
In Nigerian federal civil parlance, appointment is often synonymous with recruitment (Al- Gazali, 2006). Recruitment in the Nigerian federal civil service is determined by three major factors (Babaru, 2003). The first is the availability of vacancies declared by the ministries and extra-ministerial departments and forwarded to the commission through the office of the head of civil service of the federation. Awareness for such vacancies is publicized through advertisements and notices. The second factor is the qualifications of the potential applicants. The specific qualifications and skills required for various categories are presented in schemes of service (2000). The third factor is the principle of federal character. That is quota allocated in the recruitment exercise to states to ensure that the federal civil service reflects ‘Federal Character.’
Federal character principle is a constitutional matter and an important factor that determine appointments into the federal civil service. This issue is expressed in section 14(3) of the constitution as “The composition of the Government of the Federation or any of its agencies and the conduct of its affairs shall be carried out in such a manner as to reflect the Federal Character of Nigeria and the need to promote national unity, and also to comm.- and national loyalty thereby ensuring that there shall be no predominance of persons from few States or from few ethnic or other sectional groups in that Government or any of its agencies.”
The basic idea of the principle is to have an even representation of all states, ethnic and other sectional groups in the federal service. It has a lot of political support, especially from those in the disadvantaged areas- mainly the northern states of Nigeria (Olowu et al., 1997). In order to implement this concept effectively, a commission called the Federal Character Commission was created in 1995. However, promotion in the federal civil service is determined by factors such as number of years in a grade level, performance in promotion examination and interviews (FRN, 1998), and availability of vacancies or jobs at a higher level.
2.3 BRIEF HISTORY OF NIGERIA PUBLIC SECTOR
The private sector was the traditional structure of the world’s economies. The Nigerian economy is largely private-sector based. The public sector emerged in Nigeria as a result of the need to harness rationally the scarce resources to produce goods and services for economic improvement, as well as for promotion of the welfare of the citizens. The involvement of the public sector in Nigeria became significant during the period after independence.
The railways were probably the first major example of public sector enterprises in Nigeria. At first, conceived mainly in terms of colonial strategic and administrative needs, they quickly acquired the dimension of a welcomed economic utility for transporting the goods of international commerce, like cocoa, groundnut, and palm kernels. Given the structural nature of the colonial private ownership and control of the railways in the metropolitan countries, it would hardly be expected that the Nigerian Railways Corporation could have been started as any other project than as a public sector enterprise for such mass transportation.
The colonial administration was the nucleus of necessary economic and social infrastructural facilities that private enterprise could not provide. Facilities included railways, roads, bridges, electricity, ports and harbours, waterworks, and telecommunication. Social services like education and health were still substantially left in the related hands of the Christian Mission. But even at this initial stage government herself moved positively into some of the direct productive sectors of the economy: the stone quarry at Are, the colliery at Udi, and the saw mill and furniture factory at Ijora. Those were the early stages.
The emergence of the crude oil industry into the Nigerian economy, after the civil war in the 1970s, with the associated boom intensified governmental involvement in production and in control of the Nigerian economy. One major aim of government at that time was to convert as much as possible of the growing oil revenue into social, physical, and economic infrastructural investments. The Nigerian Enterprises Promotion Decree of 1972, which took effect on 1 April, 1974, with its subsequent amendment in 1976, provided a concrete basis for government’s extensive participation in the ownership and management of enterprises. Given these developments, public sector enterprises at the federal level had exceeded 100 in number by 1985; and these had spread over agriculture, energy, mining, banking, insurance, manufacturing, transport, commerce, and other service activities, before long, the range of municipal transport to mining, from housing to multipurpose power, and from trading to banking and insurance.
At the state and local governmental levels, the range of activities that had attracted public sector investment also had become quite large. Thus, a variety of enterprises – with public interest in terms of majority equity participation or fully-owned by state and local government as well as other governmental entities – became visible in various parts of Nigeria. Between 1975 and 1995, it was estimated that the Federal Government of Nigeria had invested more than $100 billion in public sector enterprises.
2.4 CHARACTERISTICS AND CLASSIFICATION OF PUBLIC SECTOR.
The Characteristics of Public Sector Organization are:
i. A Public Sector Organization comes into existence as a result of an Act passed by the legislature or a decree under, military rule. Public Sector Organization also defines its aims and objectives, powers and duties, immunities, the form of management and relationship with established departments and ministries.
ii. It is a legal person, capable of suing and being sued, entering into contracts, acquiring and owing property in its own name and can also dispose of property than ordinary government departments.
iii. It is wholly owned by the government.
iv. Except for appropriations to produce capital or to cover losses, a public sector organization is usually independently financed. It obtains its funds from the treasury or the public and from revenues derived from the sale of goods and services. It is authorized to use and reuse its revenues.
v. It is generally exempted from most regulatory and prohibitory statutes applicable to expenditure of public funds. There are no hard and fast rules behind them in the matter of making contracts of buying and selling works, etc. Thus, a great deal of liability and discretion is left for the management in the matter of procedure.
vi. It is ordinarily not subject to the budget, account and audit laws and procedures applicable to government departments. Their audit is to be done by the Accountant-General of Nigeria or any other person appointed by him. However, both the accounts and audit are commercial nature.
vii. Excluding the offices taken from government departments on deputation the employees of public sector organization are not civil servant and they are not governed by government regulations in respect of conditions of service. The recruitment is not subject to civil service rules, promotion is by seniority and personnel can be fired easily if they are incompetent
viii. The Public Sector Organizations are free from the control of the legislature.
2.4.1 Classification of Public Sector Organization
Public Sector Organizations are classified into three; namely public/statutory corporations, state-owned companies, and mixed economy enterprises.
They are explained below:
• Public/Statutory Corporation: These are enterprises, which arise when the government assumes responsibility for the management of an economic or social pursuit through a special entity that has its own legal personality and still keeps some of the special prerogatives or privileges associated with a governmental organization. The blends of these features are aimed at enabling the organization to function effectively as an autonomous body while it remains an instrument of government policy. Enterprises that fall under statutory corporations include Central Bank of Nigeria (CBN), Nigerian Television Authority (NTA) and Federal Radio Corporation of Nigeria (FRCN) among others.
• State Owned Companies: These are companies created by government under the provisions of ordinary company law, though they belong entirely to the government. They are registered in the registry of companies, with the government as the sole proprietor. Government, therefore, appoints the Board of Directors as is customary in private companies. Examples of such companies include New Nigeria Newspaper Ltd, New Nigeria Development Company Ltd and Odua Investment Company Ltd.
• Mixed-Economy Enterprises: These are enterprises where the government is the majority shareholder in a partnership with private entrepreneurs. In such companies, government usually dominates the board since it is the major shareholder. One example of such enterprises is Peugeot Automobile Nigeria Ltd. (PAN). (Obikeze and Anthony: 2004:249-250).
2.4.2 Reasons for the establishment of public sector organization
There are many reasons for the establishment of Public Sector Organization. They are outlined below:
• The desire to use the Public Sector Organization as an instrument of effective plan implementation in a context where it appears futile devises a development plan for the private sector.
• The need to secure economic independence.
• The urgent desire to assure government control over “strategic” sectors of the economy (e.g. Central Banking, Broadcasting, iron and steel, roads, shipping, etc).
• The need to separate some activities from the civil service and allow more autonomy in their running.
• The perceived need to provide employment for the citizens in context where the private sector offers very limited employment opportunities.
• The need to ensure state control of key profitable enterprises with a view to generating revenues that will add to available national capital for financing development programmes and projects.
• The desire of some socialist-orientated regimes to use state control of key profitable enterprises to pursue the objectives of preventing the concentration of wealth or of the means of production and exchange in the hands of few individuals or of a group (i.e. promoting equitable distribution of wealth) (Obikeze and Anthony: 2004:253).
• In many developing countries, the resources available to the private sector are not adequate Also political considerations influence governmental involvement in the provision of certain social and economic services. In many African countries, development is closely associated with the provision of social services; consequently, the performance of the government in many of these countries, are evaluated on the basis of its ability to provide different types of public services in areas where such services do not exist.
• The governmental intervention in the provision and management of services in many parts of the world is the fact that no person should be permanently deprived of the access to such facilities because of lack of finances or by reason of geographical location.
• Another reason relates to the need to protect the consumer, which may not be of Interest to the private sector. For example, government intervenes in the provision of education in many countries to protect children, who are not capable of making important decisions for them, by making education up to a certain age compulsory and free.
• The governmental intervention in the provision of certain services relates to the indivisibility that characterizes such services. Some facilities, such as bridges, tunnels, roads, streetlights, and waste disposal facilities, cannot be divided or partially provided. Either streetlights are provided for the benefit of everybody in the community or they are not. Facilities of this type must therefore be provided publicly and financed through taxation.
• The final reason for governmental intervention is the consciousness of the national security. Certain facilities, like the National Ports Authority and the police, are too vital to be left at the mercy of private citizens.
2.5 HUMAN RESOURCE MANAGEMENT IN PUBLIC SECTOR
The concept of human resource management has its roots in the traditional thinking in the field of personnel management and administration but represents contemporary sophisticated views and ways of managing people at work in the public sector. Human resource management evolved from personnel management. This never term according to Ikeagwu (1999:58) assumes a different position and tackles organizational problems from a different direction. It takes into account activities like planning, monitoring and control rather than mediation between employee and management of a public sector organization.
This means that human resource management involves every aspect of dealing with employee as resources. This view was upheld by Colby and Alkon (1991:103) and Byars and Rues (1991:6) in their attempt to come up with a meaningful definition of human resource management.
Colby and Alkon’s views were more or less in line with personnel functions or human resource functions in that they stated in their text that human resources management involves every aspect of dealing with employee as resources as such as planning, staffing, training and development, performance appraisal and compensation.
Their views however differs from those of Byars and Rues conclusion in that the latter sees human resource management in the aspect of wages and salaries and still support the former’s view by including recruiting, hiring, and training as the major functions of human resources management.
Human resource management can also be seen as that which involves all management decisions and practices that directly affect or influence the people who work for the organization. This definition of human resource management is broader and more practical oriented than personnel management put by Fillipo (1979:75). Wikipedia defines Human Resource Management (HRM) as the management of an organization’s employees. While human resource management is sometimes referred to as a “soft” management skill, effective practice within an organization requires a strategic focus to ensure that people resources can facilitate the achievement of organizational goals.
Human resource management is defined as a strategic and coherent approach to the management of an organization’s most valued assets – the people working there who individually and collectively contribute to the achievement of its objectives. Storey (1989) believes that HRM can be regarded as a ‘set of interrelated policies with an ideological and philosophical underpinning’. He suggests four aspects that constitute the meaningful version of HRM:
1. A particular constellation of beliefs and assumptions;
2. A strategic thrust informing decisions about people management;
3. The central involvement of line managers; and
4. Reliance upon a set of ‘levers’ to shape the employment relationship.
Human resource management according to Fisher et al (1990: P6) involves all management decisions and practices that directly affect or influence the people who work for the organization. According to Ikeagwu (1999) the two terms human resource management and personnel management are synonymous but personnel management is the older and more an established name while human resource management is the more up to date title for the field.
Human Resource Management (HRM) is a planned approach to managing people effectively for performance. It aims to establish a more open, flexible and caring management style so that staff will be motivated, developed and managed in a way that they can give of their best to support departments’ missions. Good (HRM) practices are instrumental in helping achieve departmental objectives and enhance productivity.
Susan M. Heathfield (2011:12), Human Resource Management (HRM) is the function within an organization that focuses on recruitment of, management of, and providing direction for the people who work in the organization. Human Resource Management can also be performed by line managers. Human Resource Management is the organizational function that deals with issues related to people such as compensation, hiring, performance management, organizational development, safety, wellness, benefits, employee motivation, communication, administration, and training. Human Resource Management is also a strategic and comprehensive approach to managing people and the workplace culture and environment. Effective (HRM) enables employees to contribute effectively and productively to the overall company direction and the accomplishment of the organization’s goals and objectives.
Human Resource Management is moving away from traditional personnel, administration, and transactional roles, which are increasingly outsourced. (HRM) is now expected to add value to the strategic utilization of employees and that employee programs impact the business in measurable ways. The new role of (HRM) involves strategic direction and (HRM) metrics and measurements to demonstrate value. Becker and Gerhart (1996) see Human Resource Management (HRM) as a term used to describe formal systems devised for the management of people within an organization. These human resources responsibilities are generally divided into three major areas of management: staffing, employee compensation, and defining/designing work. Essentially, the purpose of (HRM) is to maximize the productivity of an organization by optimizing the effectiveness of its employees. This mandate is unlikely to change in any fundamental way, despite the ever increasing pace of change in the business world.
As Edward L. Gubman observed in the Journal of Business Strategy, “the basic mission of human resources will always be to acquire, develop, and retain talent; align the workforce with the business; and be an excellent contributor to the business. Those three challenges will never change.” Until fairly recently, an organization’s human resources department was often consigned to lower rungs of the corporate hierarchy, despite the fact that its mandate is to replenish and nourish the company’s work force, which is often cited—legitimately—as an organization’s greatest resource. But in recent years recognition of the importance of human resources management to a company’s overall health has grown dramatically. This recognition of the importance of (HRM) extends to small businesses, for while they do not generally have the same volume of human resources requirements as do larger organizations, they too face personnel management issues that can have a decisive impact on business health.
2.5.1 Human Resource System
Human resource management operates through human resource systems that bring together in a coherent way:
? (HRM) philosophies describing the overarching values and guiding principles adopted in managing people.
? (HRM) strategies defining the direction in which (HRM) intends to go.
? (HRM) policies, which are the guidelines defining how these values, principles and the strategies should be applied and implemented in specific areas of (HRM).
? (HRM) processes consisting of the formal procedures and methods used to put (HRM) strategic plans and policies into effect.
? (HRM) practices comprising the informal approaches used in managing people.
? (HRM) programmes, which enable HR strategies, policies and practices to be implemented according to plan.
Becker and Gerhart (1996) have classified these components into three levels: the system architecture (guiding principles), policy alternatives and processes and practices.
2.5.2 Aims of Human Resource Management
The overall purpose of human resource management is to ensure that the organization is able to achieve success through people. As Ulrich and Lake (1990) remark: ‘(HRM) systems can be the source of organizational capabilities that allow firms to learn and capitalize on new opportunities.’ Specifically, (HRM) is concerned with achieving objectives in the areas summarized below.
1. Organizational effectiveness:
Distinctive human resource practices shape the core competencies that determine how firms compete, Cappelli and Crocker-Hefter, (1996). Extensive research has shown that such practices can make a significant impact on firm performance. (HRM) strategies aim to support programmes for improving organizational effectiveness by developing policies in such areas as knowledge management, talent management and generally creating ‘a great place to work’. This is the ‘big idea’ as described by Purcell et al (2003), which consists of a ‘clear vision and a set of integrated values’. More specifically, HR strategies can be concerned with the development of continuous improvement and customer relations policies.
2. Human Capital Management:
The human capital of an organization consists of the people who work there and on whom the success of the business depends. Bontis et al (1999) sees Human capital as representing the human factor in the organization; the combined intelligence, skills and expertise that give the organization its distinctive character. The human elements of the organization are those that are capable of learning, changing, innovating and providing the creative thrust which if properly motivated can ensure the long-term survival of the organization. Human capital can be regarded as the prime asset of an organization and businesses need to invest in that asset to ensure their survival and growth. Human resource management (HRM) aims to ensure that the organization obtains and retains the skilled, committed and well motivated workforce it needs. This means taking steps to assess and satisfy future people needs and to enhance and develop the inherent capacities of people – their contributions, potential and employability – by providing learning and continuous development opportunities. It involves the operation of ‘rigorous recruitment and selection procedures, performance-contingent incentive compensation systems, and management development and training activities linked to the needs of the business’ Becker et al, (1997). It also means engaging in talent management – the process of acquiring and nurturing talent, wherever it is and wherever it is needed, by using a number of interdependent (HRM) policies and practices in the fields of resourcing, learning and development, performance management and succession planning.
3. Knowledge management:
Knowledge management is any process or practice of creating, acquiring, capturing, sharing and using knowledge, wherever it resides, to enhance learning and performance in organizations Scarborough et al, (1999). (HRM) aims to support the development of firm specific knowledge and skills that are the result of organizational learning processes.
4. Reward management
(HRM) human resource management aims to enhance motivation, job engagement and commitment by introducing policies and processes that ensure that people are valued and rewarded for what they do and achieve and for the levels of skill and competence they reach.
5. Employee relations
The aim is to create a climate in which productive and harmonious relationships can be maintained through partnerships between management and employees and their trade unions.
6. Meeting diverse needs
(HRM) aims to develop and implement policies that balance and adapt to the needs of its stakeholders and provide for the management of a diverse workforce, taking into account individual and group differences in employment, personal needs, work style and aspirations and the provision of equal opportunities for all.
7. Bridging the gap between rhetoric and reality
The research conducted by Bontis et al (1999) found that there was generally a wide gap between the sort of rhetoric expressed above and reality. Managements may start with good intentions to do some or all of these things but the realization of them – ‘theory in use’ – is often very difficult. This arises because of contextual and process problems: other business priorities, short-termism, limited support from line managers, an inadequate infrastructure of supporting processes, lack of resources, resistance to change and lack of trust. An overarching aim of (HRM) is to bridge this gap by making every attempt to ensure that aspirations are translated into sustained and effective action. To do this, members of the (HRM) function have to remember that it is relatively easy to come up with new and innovatory policies and practice. The challenge is to get them to work. They must appreciate, in the phrase used by Purcell et al (2003) that it is the front line managers who bring (HRM) policies to life, and act accordingly.
2.5.3 Policy Goals of Human Resource Management
The models of (HRM), the aims set out above and other definitions of (HRM) have been distilled by Wright, (2008) into 12 policy goals:
1. Managing people as assets that are fundamental to the competitive advantage of the organization.
2. Aligning (HRM) policies with business policies and corporate strategy.
3. Developing a close fit of (HRM) policies, procedures and systems with one another.
4. Creating a flatter and more flexible organization capable of responding more quickly to change.
5. Encouraging team working and co-operation across internal organizational boundaries.
6. Creating a strong customer-first philosophy throughout the organization.
7. Empowering employees to manage their own self-development and learning.
8. Developing reward strategies designed to support a performance-driven culture.
9. Improving employee involvement through better internal communication.
10. Building greater employee commitment to the organization.
11. Increasing line management responsibility for (HRM) policies.
2.5.4 Characteristics of (HRM)
The characteristics of the (HRM) concept as they emerged from the writings of the pioneers and later commentators are that it is:
• strategic with an emphasis on integration;
• based on the belief that people should be treated as assets (human capital);
• unitarist rather than pluralist, individualistic rather than collective in its approach to employee relations;
• a management-driven activity – the delivery of HRM is a line management responsibility;
• focused on business values.
2.5.5 Principles of Human Resource Management
Business consultants note that modern human resource management is guided by several overriding principles. Perhaps the paramount principle is a simple recognition that human resources are the most important assets of an organization; a business cannot be successful without effectively managing this resource. Another important principle, articulated by Michael Armstrong in his book; A Handbook of Human Resource Management, is that business success “is most likely to be achieved if the personnel policies and procedures of the enterprise are closely linked with, and make a major contribution to, the achievement of corporate objectives and strategic plans.” A third guiding principle, similar in scope, holds that it is HR’s responsibility to find, secure, guide, and develop employees whose talents and desires are compatible with the operating needs and future goals of the company. Other (HRM) factors that shape corporate culture whether by encouraging integration and cooperation across the company, instituting quantitative performance measurements, or taking some other action—are also commonly cited as key components in business success. (HRM) summarized Armstrong, “is a strategic approach to the acquisition, motivation, development and management of the organization’s human resources. It is devoted to shaping an appropriate corporate culture, and introducing programs which reflect and support the core values of the enterprise and ensure its success.”
2.5.6 Position and Structure of Human Resource Management
Human resource management department responsibilities can be broadly classified by individual, organizational, and career areas. Individual management entails helping employees identify their strengths and weaknesses; correct their shortcomings; and make their best contribution to the enterprise. These duties are carried out through a variety of activities such as performance reviews, training, and testing. Organizational development, meanwhile, focuses on fostering a successful system that maximizes human (and other) resources as part of larger business strategies. This important duty also includes the creation and maintenance of a change program, which allows the organization to respond to evolving outside and internal influences. The third responsibility, career development, entails matching individuals with the most suitable jobs and career paths within the organization.
Human resource management functions are ideally positioned near the theoretic centre of the organization, with access to all areas of the business. Since the (HRM) department or manager is charged with managing the productivity and development of workers at all levels, human resource personnel should have access to—and the support of key decision makers. In addition, the (HRM) department should be situated in such a way that it is able to effectively communicate with all areas of the company. (HRM) structures vary widely from business to business, shaped by the type, size, and governing philosophies of the organization that they serve. But most organizations organize (HRM) functions around the clusters of people to be helped—they conduct recruiting, administrative, and other duties in a central location. Different employee development groups for each department are necessary to train and develop employees in specialized areas, such as sales, engineering, marketing, or executive education. In contrast, some (HRM) departments are completely independent and are organized purely by function. The same training department, for example, serves all divisions of the organization.
In recent years, however, observers have cited a decided trend toward fundamental reassessments of human resources structures and positions. “A cascade of changing business conditions, changing organizational structures, and changing leadership has been forcing human resource departments to alter their perspectives on their role and function almost overnight,” wrote John Johnston in Business Quarterly. “Previously, companies structured themselves on a centralized and compartmentalized basis—head office, marketing, manufacturing, shipping, etc. They now seek to decentralize and to integrate their operations, developing cross-functional teams…. Today, senior management expects (HR) to move beyond its traditional, compartmentalized ‘bunker’ approach to a more integrated, decentralized support function.” Given this change in expectations, Johnston noted that “an increasingly common trend in human resources is to decentralize the (HR) function and make it accountable to specific line management. This increases the likelihood that (HR) is viewed and included as an integral part of the business process, similar to its marketing, finance, and operations counterparts. However, (HR) will retain a centralized functional relationship in areas where specialized expertise is truly required,” such as compensation and recruitment responsibilities.
2.6 IMPACT OF HRM ON PRODUCTIVITY IN PUBLIC SECTOR
Productivity is an index which is used to measure the ratio of output per unit of input (Imaga, 1999). It simply tells whether or not factors of production are contributing more or less to total output. Production means application of processes (Technology) to the raw material to add the use and economic values to arrive at desired product by the best method, without sacrificing the desired quality. We have three ways of Production, they are:
(i) Production by Disintegration: By separating the contents of Crude oil or a mixture the desired products are produced. For example the crude oil is disintegrated into various fuel oils. Similarly salt production is also an example for product produced by disintegrated. We can use Mechanical or Chemical or both technologies to get the desired product, so that it will have desired use value.
(ii) Production by Integration: In this type of Production various Components of the products are assembled together to get the desired product. In this process, Physical and Chemical Properties of the materials used may change. The examples are: Assembly of Two wheelers, Four wheelers and so on.
(iii) Production by Service: Here the Chemical and Mechanical Properties of materials are improved without any physical change. The example for this is Heat Treatment of metals. In real world, a combination of above methods is used.
In general production is the use of any process or procedure designed to transform a set of input elements into a set of output elements, which have use value and economic value. Production, in economics, manufacture and processing of goods or merchandise, including their design, treatment at various stages, and financial services contributed by bankers. Various economic laws, price data, and available resources are among the factors in production that must be considered by both private and governmental producers.
Production technology refers to the way capital, technology, natural resources, and labour are combined to create final goods. Businesses choose these inputs depending on the type and quantity of goods they produce. For example, a snack-cake factory and a local bakery will each use different equipment and methods to produce cupcakes. A production technology that requires many workers and relatively few machines is called a labour-intensive technology. A technology that uses many machines and relatively few workers is called a capital-intensive technology. Generally, as industries grow, they become more capital intensive. In the United States between 1950 and 1997, for example, the number of workers employed for every million dollars of commercial capital decreased from 33 workers to 1.1 workers.
2.7 THE EFFECTS OF HUMAN RESOURCE MANAGEMENT PRACTICE ON PRODUCTIVITY
Given the evidence in variations in HRM practices and productivity a natural question to ask is are these connected? We find that the answer is “probably, yes”. In the empirical section we focus on productivity as the key outcome. Many studies look at other outcomes such as worker turnover, absenteeism, worker perceptions, etc. These are useful, but if they have no effect on productivity then in our view they are second order – generally studies use them because they have no direct evidence on productivity (e.g. Blasi et al, 2009:4). We do not focus on measures of worker wellbeing such as job satisfaction or wages. Lazear and Shaw (2008) suggest that some of the dramatic increase in wage inequality in the US, UK and other country since the late 1970s is due to HRM practices. Lemieux et al (2009) and Guadalupe and Cunat (2009a) also take this position, although the current state of the evidence is still limited. These are interesting outcomes in their own right, and may also feed through into productivity, but we are space constrained and refer the reader to the wider literature were relevant.
An important issue is the correct way to econometrically estimate production functions and TFP. Ackerberg et al (2007) have surveyed such methods in a recent Handbook chapter, and this is a lively (but still unsettled) area of research. There is also a growing literature on examining the impact of worker characteristics (or “human resources” such as skills, gender, race, seniority and age) on productivity through direct estimation in production functions rather than the traditional approach of looking at these indirectly through including them in wage equations. Interested readers are referred to recent examples of this approach in Dearden et al (2006).
An important rejoinder to this is that firms maximize discounted profits, not productivity. It may increase productivity to introduce a given HRM practice, but this may still reduce profits, which is why firms have chosen not to adopt (an example is Freeman and Kleiner, 2005, who found that the abolition of piece rates reduced productivity but increased profits as quality rose in the absence of piece rates). This is analogous to any factor input such as capital – increasing capital per hour will increase output per hour, but the firm already takes this into account in its maximization program. Thus, just as we are interested in estimating the parameters of a conventional production function for capital and labour, we may be interested in the parameters associated with an HRM augmented production function.
A second for studying the effect of HRM on productivity is that if we do see any effect, we are interested in the mechanisms through which this effect is working. For example, we expect the introduction of incentive pay to affect the type of workers who want to join and leave the firm. How important are these sorting and selections effect relatively to the pure incentive effect? Moreover, even if we expect a positive effect, we may not be so interested in the average effect but rather how this varies with observable characteristics of sub-groups of workers, or of the firm or of its environment. Theory suggests that changing HRM will have heterogeneous effects in this way, so this places some more testable restrictions on the data.
2.8 CHALLENGES OF HUMAN RESOURCE MANAGEMENT IN PUBLIC SECTOR
A number of factors tend to influence the optimum allocation of Human Resources in public sector. Among them are the policies relating to recruitment, training, employment conditions, and the deployment of personnel. Equally important are the prevailing management environment, socio-economic conditions, and the traditional work culture. Let us take this one by one.
2.8.1 WORK MOTIVATION AND COMPENSATION
It has been commonly assumed that public sector organizations are more likely to employ individuals whose values and needs are consistent with the public service mission of the organization (Baldwin, 1984; Crewson, 1997; Perry ; Wise, 1990; Perry, 1996, 1997). Charged with promoting general social welfare, as well as the protection of the society and every individual in it, public organizations often have missions with broader scope and more profound impact than typically found in the private sector (Baldwin, 1984). The composition of the public workforce has been expected to reflect the nature of the work in the public sector by attracting employees who desire greater opportunities to fulfil higher-order needs and altruistic motives by performing public service. It is these individual characteristics that are often touted as the key to motivating behaviour because “understanding the values and reward preferences of public managers is essential in structuring organizational environments and incentive systems to satisfy those preferences” (Wittmer, 1991, p. 369). In fact, it is believed that the importance public employees place on the opportunities thought to be more readily available in the public sector, such as performing altruistic acts or receiving intrinsic rewards, compensates for the low levels of extrinsic rewards associated with the public sector and explains why no differences have been found between public and private employee work motivation (Baldwin, 1984, 1987; Rainey, 1979, 1983).
Public sector employees have been found to place a lower value on financial rewards ( Houston, 2000; Khojasteh, 1993; Wittmer, 1991) and a higher value on helping others or public service (Buchanan, 1975; 1984; Crewson, 1997; Houston, 2000; Rainey, 1983; Wittmer, 1991) than their private sector counterparts. Empirical support for these differences, however, has not always been consistent. Several studies have failed to find differences in preference for monetary rewards (Crewson, 1997; Gabris ; Simo, 1995; Maidani, 1991), while others have found that even if public employees do value monetary rewards less than private employees, such financial incentives still are highly valued (Rainey, 1982; Wittmer, 1991). Evidence also has been found to suggest that public employees do not value opportunities to benefit society (Gabris ; Simo, 1995) any more than those in the private sector.
Competing Models for the Effects of Public Service Motivation
• Job Mediated Model
Recent reviews of work motivation theories have suggested that any model of work motivation should include the underlying process variables that explain how goals affect work motivation (Kanfer, 1992; Katzell ; Thompson, 1990). Goal theory suggests that employees will expend greater effort toward achieving performance goals that they believe will result in important outcomes (Locke ; Latham, 1990). This emphasis on the importance of outcomes is consistent with Rainey and Steinbauer (1999) have suggestion that the effectiveness and performance of government agencies may be enhanced by three interrelated levels of intrinsic rewards–task, mission and public service–that are available through the employee’s role in the organization. Although goal theory can be used to illustrate how employee work motivation can be influenced by all three levels, it suggests that the effects of mission valence and public service motivation are mediated at the job level.
At the job level, goal theory suggests that work motivation requires the employee to believe that performance goals can be attained and will result in important outcomes for themselves or, to the extent they are committed to organizational goals, for their organization (Klein, 1991). In other words, work motivation is enhanced when employees see their job as not only as doable but also important. These job levels attributes and their implications for explaining the separate contributions of public service and mission on work motivation are discussed below.
• Self-efficacy: The extent to which goals seem achievable is determined by an individual’s sense of self efficacy, the individual’s judgment of his or her own “capabilities to organize and execute courses of action required attaining designated types of performances” (Bandura, 1986, p. 391). Self-efficacy influences motivation through its effect on the direction and persistence of behaviour. If employees feel more confident in their abilities, they are more likely to see goals as achievable and worthy of their effort. Higher levels of self-efficacy often are associated with better performance, because individuals who believe that they can accomplish a goal are more likely expend the necessary effort and persist in the face of obstacles (Bandura, 1988; Bandura ; Cervone, 1983, 1986). Self-efficacy has been shown to enhance certain types of performance in the public sector. Frayne and Latham (1987; Latham ; Frayne, 1989) found that enhancing employee self-efficacy to overcome obstacles affecting the ability to come to work can increase job attendance among public employees.
• Job Importance: In addition to having achievable goals, employee work motivation also requires that performance objectives be viewed as important. If employees do not perceive their job to be important or meaningful, they have little reason to be motivated to perform their work. Although self-efficacy is important when understanding motivation at the job level, it is the concept of job importance that is especially salient in understanding the contributions public service motivation and organization mission make toward organization performance. There are a number of ways in which organizations can affect the employee’s perceptions of goal importance. First, as mentioned above, managers can persuade employees that their jobs are important by providing a convincing rationale for their work tasks (Locke, Latham, & Erez, 1988). One way managers may attempt to do this is by linking the job performance directly to organizational performance. Similar to the concept of task significance, if employees can see how their work contributes to achieving important organizational goals, then they are more likely to see their work as meaningful (Wright, 2001). In the public sector, however, this aspect of goal theory may be particularly salient because the link between individual and organization goals may extend beyond the boundaries of the organization (Perry & Porter, 1982; Perry & Wise, 1990; Rainey & Steinbauer, 1999). Public service motivation asserts that public employees may view their performance goals as important because of the congruence between the altruistic or community service nature of public sector goals and the high value that public sector employees place on work that helps others and benefits society (Crewson, 1997; Perry & Wise, 1990; Wittmer, 1991). If achieving assigned goals can satisfy personal employee motives, such as performing public service, then they are more likely to be perceived as important and accepted as personal goals.
In addition to the intrinsic rewards provided by the nature of the job or function of the organization, organizations may also make assigned performance goals important to the employee by providing appropriate extrinsic rewards for goal attainment (Klein, 1991; Mowen, Middlemist, & Luther, 1981; Wright, 1989). Not only is the type and amount of reward important, but such extrinsic rewards must contingent on performance if they are to act as performance incentives (Lawler, 1994). If, as evidence suggests, public sector employees value extrinsic rewards less than their private sector counterparts (Houston, 2000; Khojasteh, 1993; Wittmer, 1991) or perceive a weak link between performance and rewards (Porter & Lawler, 1968; Rainey, 1983), then the utility of this method for enhancing goal importance is severely limited.
• Direct Effect Model: Using the same basic theoretical constructs, the literature on public service motivation may suggest an alternative explanation of contributions public service, mission and job characteristics make toward employee work motivation. Three changes in particular may be implied. First, Rainey and Steinbauer (1999) suggest that, in addition to an effect on job or task level motivation, the organization’s mission may increase employee public service motivation by attracting “individuals who will self-select into the organization on the basis of the valence of the mission for them”. Second, the research on public service motivation seems to imply that public service motivation would have a direct effect on employee work motivation and performance (Brewer ; Seldon, 1998, 2000; Crewson, 1997; Naff ; Crum, 1999; Perry ; Wise, 1990; Wittmer, 1991) rather than an indirect effect mediated by job level characteristics. A third way that a model suggested by the public service motivation literature may differ from one implied by goal theory is that it may assume that extrinsic rewards have a direct effect on employee work motivation. Such an assumption seems to underlie the view that no differences in public and private employee work motivation exist because the opportunity to fulfil altruistic or service needs in the public service compensates for the higher levels of extrinsic rewards available in the private sector (Perry ; Wise, 1990).
METHODS FOR MOTIVATING EMPLOYEES
The purpose of this report is to discuss some of the possibilities in motivating employees to be productive in the workplace. The areas to be discussed are Financial Motivation and Non- Financial Motivation. Both are powerful forces in determining the drive, productivity, and effectiveness of every company employee.
Financial Motivation: Public Sector managers find many ways to motivate their employees, so they desire to perform to the best of their abilities. Financial rewards and incentives are common in the business world today; although, most experts agree money is not the best motivator because the motivational effect of most financial rewards does not last. According to Donna Deeprose (1994), “For one thing, while the presence of money may not be a very good motivator, the absence of it is a strong demotivator.”
Therefore, financial rewards are an absolutely necessary base to successful motivates a public sector’s workers. The most common types of financial rewards that will be discussed in this paper are salary increases, profit sharing, incentive travel, and paid time-off.
Salary increases: As has been mentioned, the absence of salary increases or bonuses can be a strong de- motivator, primarily because people use money as a scorecard to measure their achievement. Money is also an indicator to the person of how important he or she is perceived to be within the public sector organization. The absence of salary increases or bonuses to some employees would indicate that they are not valued within the organization. If employees go for more than one year without receiving a raise or a bonus, their productivity is likely to decline, and valuable employees may be tempted to look for other employment, which can be costly in rehiring expenses.
Profit-sharing: Profit sharing can be a great way to motivate public sector staff because it benefits both the employee and the employer. This is a win-win situation for both. A couple of most commonly used types of profit sharing programs are those based on the public sector’ productivity and those which offer stock as a reward to employees. Most programs are designed to reward employees for the company increasing its profit or revenue. These programs are designed to give employees a bonus check, if the company performs better in a given month in the current year compared to the previous year. This type of profit sharing program provides immediate benefit and rewards for employees. When compensation is tied to performance, companies realize the benefit in the following way: “Financial rewards are also an effective motivator, and further, have the added advantage of being a ‘need’ that is generally never satisfied. Linking ‘people working smarter’ with some equitable reward system serves to reinforce the motivational process. ‘Gain-sharing’ is an effective reward system capitalizing on both aspects.” (Storey (1989, 21) Profit sharing/bonus programs have the dual effect of motivating employees to be more productive and to cut costs.
The second most common type of profit sharing is rewarding with stock; and as the Public sector organization does better, the value of the its stock increases in value. According to Nwachukwu, (2000), “One of the highest forms of recognition is to treat an employee as if he or she is an owner of the company. This represents a long-term commitment to the individual.” Stock is usually reserved to motivate high- level managers or key people within most corporations, and a couple of reasons exist for this trend. First, if managers are motivated by a profit-sharing program, they will make decisions that will benefit the corporation long term. Second, most mid-to-lower level employees prefer an immediate reward or incentive like a bonus system previously discussed to reward outstanding effort.
Incentive travel: Another effective way to financially motivate employees is with incentive travel. Many times when employees are rewarded with cash bonuses or pay raises, the money is used to pay off debt or everyday types of financial expenses. While money for everyday expenses is good, the added appeal of incentive travel, as a bonus or reward, is that employees would probably never buy something like it for themselves. Incentive travel is a management tool used to motivate and recognize participants for increased levels of performance in support of company objectives. In short, it is almost a way of bribing employees to work harder. And there is evidence it works exceedingly well (Deeprose 1994).
As already mentioned, the nation is experiencing a slow economy, where people immediately cut some of the discretionary expenses in their personal budgets like vacations and personal travel. Again, according to Donna Deeprose (1994:12), “Another benefit of incentive travel, according to incentive travel specialists, is that even in times when economies are suffering, incentive travel works”. Therefore, even in a slow economy, companies can effectively motivate their employees through incentive travel rewards.
Paid time-off: Paid time away from work is one of the most common types of financial rewards used to motivate employees. The amount of paid time-off can vary from an extended lunch to multiple days off at the same time. Nwachukwu, (2000:185) suggests how this can be done effectively, “If the job permits it, simply give people a task and a deadline and specify the quality you expect. If they finish before the deadline, the extra time is their reward”.
Financial rewards are varied according to the situation and money available to a corporation; and as the four financial rewards—salary increases, profit-sharing, incentive travel, and paid time-off—suggest, creativity is a major part of employing effective financial motivation.
This report speaks of emotive forces as internal emotional drives for performing a task. Effective motivation of employees goes beyond the financial compensation for work, and some of the most well-known companies in the world have realized the benefits of appealing to their employees’ drive to work intelligently and to be recognized. Most motivators lead directly to the empowerment and enabling of people to perform well. Productivity can be improved when a company focuses on the following: goal setting, communication, autonomy, responsibility, and flexibility.
Goal-setting: A prime motivator for people is the achievement of objectives and the recognition of peers. Achievement is the successful execution of a task to reach a desired end. Whether employees are working to fasten a bolt to an engine block or developing a competition study, the successful accomplishment of that task represents a piece of the company’s mission (Coffman ; Gonzalez-Molina, 2002). Worker’s that have a clear idea of how their task fits into the larger scheme and profit of a company will feel a sense of belonging and importance because they understand the ultimate end and importance of performing that task (Weinstein, 2002).
Setting goals is a good way to define an employees’ purpose in a company and helps to set a standard for them to gauge their success. Managers can then focus on the success of the individual by illustrating his or her performance in comparison to the goal, either with public or private recognition. In this way, the organization develops an atmosphere of attainment against measurable objectives and becomes energized with each win (Nelson, 1997). The process of defining the roles and objectives of the staff brings an invaluable opportunity for sharing communication between the employee and management.
Communication: The flow of information in a company can be a powerful tool in motivating its workforce. Communication of clearly stated goals and paths to achievement is the best way to begin developing employee talent (Nelson 1997). Registering and acting on the communication of employees also gives a powerful message about their value to the company and management (Nelson 1997). Employees want their company and team to succeed; and when management uses the input to help them be productive, a sense of empowerment and ownership of the process develops. The open communication also gives a measure of control over their work environment and allows for the improvement of each individual working situation.
The reward employees receive for communicating is not always what managers might view as an award. As Matejka (1991) says, “. . . giving an employee something pleasant is not the only way to reward. You are also rewarding (making life more pleasant) when you take something away that the employee dislikes”. Enhancing the work life, thereby compensating the employee for the communication, is a way to build rapport and loyalty. When the work environment is pleasant, the employee’s satisfaction and motivation increase. Communication also gives rise to trust between the supervisors and their staff. Trust enables management to give autonomy and to encourage independence, and that trust builds a strong sense of community for the employee.
Responsibility: Employees place a ‘worthwhile job’ above every other employment concern, including money (Walters & Fenson, 2000). Responsibility for the success or failure of a project is a large part of creating job worth (Nelson, 1997). When employees are given the tools and autonomy to do a certain project, or work in a particular role, they are motivated to perform brilliantly because they are accountable for that particular function. Responsibility for a project will also give a good employee the opportunity to display talent and creativity in solving a problem or completing a task.
When tasks are clearly outlined to stress individual and group accountability, employees feel that management is putting trust and faith in their abilities to perform. This causes positive effects as illustrated by one of the great hockey players, Phil Esposito, who set an 11-year record for the most goals in a game in 1971. He said that the most influential coaches in his career were the ones that allowed him to play his own style. The coaches trusted his talent and helped him to develop and play with his own unique style (Coffman & Gonzalez-Molina, 2002).
Flexibility: One of the aims of companies should be flexibility with employees. During the 1990’s, companies realized tremendous productivity gains by demonstrating flexibility in the work environment. Schedule and organizational flexibility allow employees to balance home and work more effectively and cause productivity and morale gains as well (Nelson, 1997). Just as previously illustrated with McCormick and Company, more hours worked and time clock punching do not necessarily make a company profitable or effective.
Flexibility in work scheduling allows work to be arranged according to the individual’s need. Many companies illustrate how the flexible schedule gives tremendous returns in employee loyalty, retention, and compensation. One company could not attract desirable applicants because it could not afford the massive benefit and financial compensation packages of the bigger firms. The company management decided to move towards flex-time, eradicated time clocks, and invented ‘management by wandering around.’
2.8.2 ETHICS AND VALUE
One of the most important factors that influence an organization’s response to its external environment is its ethics. According to Bateman and Snell (2009:75) organizational ethics is the set of important assumptions about the organization and its goals and practices that member of the company share. It is a system of shared values about what is important and belief about how the world works. In this way, a company’s ethics provides a frame work that organizes and directs people’s behaviour on the job. In the word of Robbins and Judge (2007:573) organizational ethics is a system of shared meeting held by members that distinguishes the organization from the organizations. This system of shared meaning, on closer examination, a set of key characteristics that the organization values.
Bhaskar (2007:419) quoting Hofstede et al “organizational ethics is defined as patterns of shared values and beliefs that overtime produce behavioural norms adopted in solving problems. In the opinions of Laurie (2007:721) organizational ethics is seen as the collection of traditions, values, policies, beliefs and attitudes that constitute pervasive context for everything we do and think in an organization. According to Nelson and Quick (2005: 362) organizational ethics is a pattern of basic assumptions that are considered valid and that is taught to new members as the way to perceived, think and feel in the organization. Organizational ethics can have a negative and positive effect upon a company, certain forms of corporate ethics would definitely be seen as detrimental if adopted by members of the organization. Ethics are anchored in the organizational collective and exercise influences without the direct involvement of particular key actors. Webster’s New world Dictionary, 3rd College Edition defines “ethics as relating to what is good or bad and having to do with moral duty and obligation” Moral is defined as relating to principles of right and wrong.
According to Hodgetts and Luthers (1997:16) ethics is acquired knowledge that people use to interpret experience and generate social behaviour. This knowledge form values, create attitudes and influences behaviour. Ugbaja (2000:28) define ethics as the sum total of cumulative processes and product of societal achievement and the way people live in a particular place, time and setting. Ethics is therefore, a distinctive and transmissible network of symbols, which characterizes a designated aggregate of people Anyanwu (1999:21). Ethics is a body of solutions to problems that have worked consistently and are taught to new members as the correct way to perceive, thinks about and feel in relation to those problems Edgar H.Schein (1990). Ethics can be defined as “the sum total of how an organization accomplishes all that it has to do to fulfil its purpose or mission. Management research defines ethics as “the way in which a group of people solve problems and resolves dilemmas”. This view is very hands-on, pragmatic approach. Geert Hofstede has described ethics in a somewhat more philosophical way. Ethics is a deeply rooted value or norms, moral or aesthetic principles that guide action and serve as standards to evaluate one “own and other behaviours”. Both of these definitions and those of others, who work in the management and behavioural sciences, leave one convinced that ethics is needed the “first Principle”, of organizational functioning.
A popular and simple of defining ethics is “how things are done around here “. For example, Atkinson explains organizational ethics as reflecting the underlying assumptions about the way work is performed; what is acceptable and not acceptable, and what behaviour an actions are encouraged and discouraged. The ethics of an organization is also often likened to the personality of an individual. Perry and Wise (1990:5) observe, “Ethics is the name we give to our concern for good behaviours. We feel an obligation to consider not only our own personal wellbeing, but also of others and human society as a whole”.
Declining Public Service Ethics
Public service ethics are the traditional values of the public service, which emphasize equity, probity, integrity, moral conduct and political neutrality. The public service should be an ethical institution as the protectors of the public interest. The concept of ethics derives from ethos, and implies the character or custom of a people. It denotes the values associated with right or wrong, appropriate practices or inappropriate practices. Public service delivery will be enhanced through an organization culture that strengthens employee involvement, rewards teamwork, recognizes individual effort and incorporates the needs of clients and users.
Declining Social Values
One of the major challenges to public sector management reforms is the declining social value of society itself. Values such as integrity, honesty, dependability, helpfulness, impartiality, courteousness, and fairness are gradually disappearing from the public services (Agere and Mendoza, 1999: 26). Unfortunately, in most African societies, there is no system for reinforcing these values. A key factor underlying the ineffectiveness of administrative and financial accountability systems is the endorsement of “wealth at all costs” by many African societies. Public office holders and public servants who do not appear to have “prospered” from occupying public positions are treated with scant respect. This declining value tends to encourage inefficiency and misappropriation of public money.
2.8.3 WORK ATTITUDE
This seeks uniform understanding, the human resource management of public sector organization as concerns work attitude and productivity. It shall start by defining the concept of work attitude as a human problem. As described by Makin et al (1996), ‘Any attitude contains an assessment of whether the object to which it refers is liked or disliked.’ Attitudes are developed through experience but they are less stable than traits and can change as new experiences are gained or influences absorbed. Within organizations they are affected by cultural factors (values and norms), the behaviour of management (management style), policies such as those concerned with pay, recognition, promotion and the quality of working life, and the influence of the ‘reference group’ (the group with whom people identify).
Attitudes are evaluative statements either favourable or unfavourable, which reflect how one feels about something like people, objects or events (Robbins and Judge 2007:74). For instance, when one says, “I can’t wait to leave this job”. He or she is merely saying I am dissatisfied with my job and so many negative things follow such attitudes. The underlying causative factors behind certain attitudes may be complex but have definite influence on how one behaves and that is why the study of attitude is important in determining the human problems in managing public sector organization.
Components and Characteristics of Work Attitudes
There is consensus in the literature that there are three components of attitudes. These components are similar to the domains which education seeks to affect. They are:
Cognitive Component: This is the thought or mindset level. It reflects a person’s perception or belief about something (Nelson and Quick, 2005). For instance, an evaluative statement could read; “I believe that women are better administrators than men”. This is an evaluative statement that reveals one’s belief about women’s administrative competence compared to men. This is at the cognitive level and thus at the level of the mind and thoughts.
Affective Component: This captures the emotional component of attitudes. It usually derives from the cognitive domain. In other words, one’s mindset in most cases affects his or her feelings.
Behavioural Component: This is the behaviour component of attitude. It is believed that behaviour in here from belief and feeling. It is a statement revealing intensions to behave in a certain way toward someone or something. The underlying variables define the core characteristics of attitudes. They are:
Importance: These are attitudes that reflect one’s fundamental interest, values and identification with the object that a person deals with. The more important the attitude, the stronger the relationship to behaviour, while the less the important the lower the chance of the behaviour.
Specificity: Some evaluative statements are general and somewhat ambiguous while others are more specific; the more specific the stronger the link with behaviour and vice versa.
Accessibility: This is saying that the more easily remembered attitudes are more likely to affect behaviour than those not easily assessable to the memory. There is a truism, however that the attitudes frequently expressed are the ones most likely to be remembered easily and thus most likely to predict behaviour.
Direct Experience: There is a strong relationship between attitudes borne out of experience than those only held as belief. In other words there is a strong likelihood that attitudes which result as a direct experience will influence behaviour more than those held through other means.
The Impact of Work Attitude on Managing Public Sector Organization
There are attitude for virtually every field of endeavour, but when it comes to work and managing public sector organization, there are basically three related attitudinal components. These components are:
Job Satisfaction: This is broadly defined as one’s positive feelings toward their job resulting from the evaluation of its characteristics. If the feeling is high, then one is said to be satisfied, thus the human problem as regard to work attitude has been managed effectively.
Job Involvement: This measures the degree to which people identify psychologically with their job and consider their perceived level of performance important to self worth and actualization.
Organizational Commitment: While job involvement looks at ones identification and commitment to the job, organizational commitment looks at one’s commitment to their organization. It is defined as a state in which an employee identifies with a particular organization and its goals.
2.8.4 RECRUITMENT AND SELECTION PROCESS
The recruitment and selection processes are to ensure the engagement of reliable, competent and qualified officers and workers. Fatiregun (1992:131) defines both recruitment and selection as follows: recruitment is the process of assessing a job, announcing the vacancy, arousing interest and stimulating people to apply, while selection is the process of choosing, for excellence, through the process of rejection or matching the applicants, first, against the attributes which we expect will make for success on the job, and secondly, matching the candidates one against the other until we have rank ordered all of them in order of relative suitability.
This merit scale of the candidates must be followed strictly in the selection of candidates in line with existing vacancies. The contribution of the human resource is likely to be determined largely by the calibre of people recruited into an organization. In most cases, employers focus on the qualifications and experience of candidates being considered for vacant positions. While this is prima facie useful, it does not necessarily follow that the credentials make the employee. Even when we discount the possibility of forgeries and certificate racketeering, academic training by itself might not adequately prepare a person for a job. The same thing applies in the case of experience which might neither be “cognate” nor “relevant”. In fact, instead of focusing mainly on educational qualifications and experience, recruiting bodies would need to go further and probe deep into the aptitudes, attitudes, personal character of candidates for certain jobs. Certainly, jobs in the security and law enforcement agencies, financial institutions, customs, immigration and the postal service would, in view of the public attention they have attracted, benefit from a professional approach to staff selection.
These processes of recruitment and selection have been corrupted by the Nigeria environmental factors (Nnadi, 2009) as shown below:
• Political Pressure,
• Theory and practice of “Ima Mmadu” or “Who you knew”,
• Federal character principle of representation,
• Common state of origin among staff in the same department.
1. Political Pressures: The political party in power, at the centre or state, forms of government. This work views political pressure as a way of favouring or rewarding party loyalists and sometimes defeated candidates with key or principal appointments. Ezeani (1992:114) affirms that political consideration informed some major decisions in the employment of key officers in the public sector organization. These political appointees serve “as the eyes of government” and vibrate as informal organization leaders and short-change production quality. (Bretton et al, 1994).
2. Recruitment Policies and Practices: The contribution of the human resource in the public sector organization is likely to be determined largely by the calibre of people recruited into an organization. Sometimes these people with the right qualification are not given the job but rather to an inexperienced, unqualified person just because he or she happens to know an MD or someone in the public sector. The issue of IM (man-know-man) has been a major setback in the recruitment policy of the Nigerian Public sector organization. In most cases, employers of the public sector organization focus on the qualifications and experience of candidates being considered for vacant positions, while this is prima facie useful, it does not necessarily follow that the credentials make the employee. Even when we discount the possibility of forgeries and certificate racketeering, academic training by itself might not adequately prepare a person for a job. The same thing applies in the case of experience which might neither be “cognate” nor “relevant”. In fact, instead of focusing mainly on educational qualifications and experience, recruiting bodies of the public sector organization would need to go further and probe deep into the aptitudes, attitudes, personal character of candidates for certain jobs. Certainly, jobs in the security and law enforcement agencies, financial institutions, customs, immigration and the postal service would, in view of the public attention they have attracted, benefit from a professional approach to staff selection.
However, in practice, the principle may be subverted, especially if it is interpreted as a crude form of ethnic balancing. In a diverse society like Nigeria, the public service cannot evade the issue of representation. When an agency is dominated by individuals from one ethnic group, the un-represented groups are likely to cry foul, and for good reasons too. It is only when the diversity of a nation is properly reflected (or “mainstreamed) in decision-making structures that the fairness of decisions could be constantly tested. It goes without saying that the issue of diversity does not end with recruitment. It extends to the day-to-day management of inter-personal and inter-group relations in public sector organization. It is therefore imperative that senior managers be exposed to the appropriate sensitivity training so that the networks of relations would be properly and adequately managed.
3. Theory and practice of “Ima Mmadu” or “Who you knew”: This raises the presumption that knowing people in executive positions, or who are well connected with the key players that shape the mood of the nation, is an accepted criterion for getting good paying jobs. Its practice has gained wide acceptance. Okoli (1999:17) calls this subjective practice- cognitive melodrama, which is, selecting candidates for offices or positions, not on the basis of merit, but on the basis of other extraneous criteria. Robbins and Judge (2007:7) call it PULL, which means gaining or securing appointment on the basis of a relationship by marriage, assessment committee members entrusted with the filling of vacancies.
This practice undermines organizational effectiveness by overwhelming merit consideration. It also violates the principle of common goal which secures the cooperation of action of all staff towards the attainment of organizational objectives. They serve their political lords and the organization at the same time.
4. Federal Character Principle of Representation: This principle characterizes the mode of securing appointment in public sector organization. Its concern is basically on fair representation of people from the various units making up the federation and promotion of national unity. Okoli (1990:29) calls it the principle of representation based on mere numerical strength and equality of number of the component parts of the federation. Section 14-(3) Chapter 11 of the Constitution of the Federal Republic of Nigeria gives force and effort to this principle of representation (political) and subordinates the principle of technical qualification (merit). The supreme law of the land stresses affection to the neglect of quality output.
The need for federal character in the recruitment of public personnel has generated a lot of controversy in recent years. There is nothing wrong with the principle. It is only the application that we have to watch. Federal character, as I once argued, mean looking far and wide for the best and the most competent. However, in practice, the principle may be subverted, especially if it is interpreted as a crude form of ethnic balancing. In a diverse society like Nigeria, the public service cannot evade the issue of representation. When an agency is dominated by individuals from one ethnic group, the un-represented groups are likely to cry foul, and for good reasons too. It is only when the diversity of a nation is properly reflected (or “mainstreamed) in decision-making structures that the fairness of decisions could be constantly tested.
It goes without saying that the issue of diversity does not end with recruitment. It extends to the day-to-day management of inter-personal and inter-group relations in public agencies. It is therefore imperative that senior managers be exposed to the appropriate sensitivity training so that the networks of relations would be properly and adequately managed.
5. Common State of Origin among Staff in the Same Department. The working party on personnel administration and management (1990:29) regrets the existing gap in the employment rules of Nigerian Public sector organization. The implication of this gap is that candidate seeking employment should not be drawn or selected from the same state, local government or geographical area. But by design or accident or hidden agenda, a fair concentration of workers or employees in a section or department is drawn from a clearly definable geographical area or ethnic group. This puts control and discipline on tests of relevance. Subordinate staff can easily be protected by their heads of section who are also, their brothers or relations. Protection rackets develop. Workers, who are outside the kinship configuration, become very insecure and uncomfortable.
Problems of recruitment in civil service
The efficiency and effectiveness of any work place (whether the private or the public sector) largely depend on the calibre of the workforce. The availability of a competent and effective labour force does not just happen by chance but through an articulated recruitment exercise (Peretomode and Peretomode 2001). Recruitment is a set of activities used to obtain a sufficient number of the right people at the right time from the right places (Nickels et al., 1999), and its purpose is to select those who best meet the needs of the work place, and to develop and maintain a qualified and adequate workforce though which an organization can fulfil its human resource plan. A recruitment process begins by specifying human resource requirements (numbers, skills mix, levels, time frame), which are the typical result of job analysis and human resource planning activities (Cascio, 1986). Information from job analysis and human resource planning activities activates the next phase in the recruitment process, namely, attracting potentially qualified candidates to apply for vacant positions in an organization.
Recruitment of personnel for the civil service is one of the crucial tasks of modern government and lies in the heart of the problem of personnel administration (Basu, 1994). The state and federal civil service commissions serve as employment agents for the civil services in Nigeria and they do the recruitment without a fee (Nwachukwu, 2000). Specifically, the authority for recruitment into the Nigerian federal civil service is the Federal Civil Service Commission (FCSC). However, the commission delegates powers to federal ministries and extra-ministerial departments to recruit junior staff to posts graded GL 01– 06 (Al-Gazali, 2006).
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