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Full Project – IMPACT OF E-MANAGEMENT ON HUMAN RESOURCE DEVELOPMENT IN THE CENTRAL BANK OF NIGERIA (1999-2009)

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CHAPTER ONE

INTRODUCTION

1.1 Background of the Study

In all the areas of organisational behaviour, the handling and management of emotions seem more neglected. This is needed for organisations to survive otherwise personal tensions and conflicts may result. People experience great difficulties in copying with fierce even outrageous impulses. The Dutch historian Huizinga (1924) writes about the more ferocious and rather unpredictable shifts of behaviour in Medieval Europe. There undoubtedly were norms and agreements to regulate behaviour and mutual interactions. Bernard du Rosier (1404 – 1475) in his effort to propagate other rules of conduct in organisations emphasised on keeping behaviour, emotions and temper under control continuously. Van (1994) noted that during the period of capitalism, the problems of organisations were discipline, behaviour management and coordination of employees. Factory regimes were based on a tangled combination of coercion from the side of organisations and willingness or motivation on the workers’ part. Bringing people together in one space implied the danger that they would get in each other’s way, that arguments could erupt as a result of differences in behaviour or that they would over indulge in other activities detrimental to the growth of the organisation. Conformance with the individual regime was indirectly threatened by corruption of the moral in the free time (Van, 1994). However, with the emergence of Scientific Method by Taylor, the founder of Scientific Organisational Design (1856 – 1915) emphasis shifted to imposition of discipline on the activities of subordinates. He explained how employees managed to restrict production by ‘soldiering and loafing’. He contended that applying individual training, better communication pattern, desirable organisational culture, forum for interaction and association and other measures could gradually overcome the tendencies of soldiering and loafing. His experience provided a good impression on how personal power can be replaced by more

‘neutral’ mechanisms of control. In today’s increasing interdependent companies and organisations – within the context of the global free-market economy, managers need to understand the synergistic roles played by organisational behaviour forces in influencing behaviour. Multinationals are reorganising in response to the changing environment, hoping to capitalise on opportunities for growth. With emphasis on international business and global economy, there is a search on for a new breed of employees and managers. Such employees know how to conduct business across international borders, is often multilingual, thinks with a world view and is able to map out strategies that keep organisations on business track. Competition in banking businesses today has made managers in the sector to realise that managing behaviour is complex and challenges innovation, economic growth and corporate sustainability. Consequently, Susmeta (2013) states that managers need to know individual differences among employees since individual differences have direct effect on behaviour stressing that people who perceive things differently behave differently; people with different attitudes respond differently to directives and that people with different personalities interact differently with bosses, co-workers, subordinates and customers. He further states that knowledge of individual differences helps to explain why some people embrace changes and eventually become successful and others are fearful of it; why some employees are productive only when they are closely monitored while others are naturally productive; why some employees learn new tasks more effectively than others and how organisational behaviour variables can be applied to explain the influence they impact on behaviour and performance.

In this context therefore and considering the critical role of banks in the economy, attempts are made to evaluate how these individual differences impact on the behaviour of workers in this important sector. An understanding of employee behaviour may be required for optimising corporate objectives of the organisation. Attainment of corporate objectives is a function of the effectiveness and efficiency of organisation members. In this context, Bagraim, Cunningham, Potgieter&Viedge(2007) submit that the effectiveness of any organisation is determined by the quality of its members and therefore the procedure adopted in deciding the quality of employees required, establishing those with requisite experience and qualifications to apply and eventually selected are critical. Consequently, Feldman and

Arnold (1983) agree that the process of selecting new organisation members is thought of as a matching process with two simultaneous goals. The organisation seeks to match as closely as possible its own needs with the capabilities of the prospective member. This assertion justifies the rigorous recruitment exercise often experienced in Nigerian banking industry. Managers are team players empowered by the willing and active support of others who are driven by conflicting self-interests. Acting on those conflicting self-interests are divergent and unpredictable behaviours influenced by certain variables. Organisational behaviour is concerned with the study of behaviour for better understanding, prediction and control.

Fieldman and Arnold (1983). Naturally, behaviour of organisation members is influenced by a combination of organisational variables of individual, group, organisational and environmental factors such as motivation, communication, leadership style, group membership, organisational culture among others. Employees are complex combination of attitudes, beliefs and needs. Their minds and brains are complex and have parallel processes running at the same time and driven by some proxies that directly or indirectly compel them to behave in a particular direction. Fieldman and Arnold (1983) also observe that managing behaviour in organisation is a lot more difficult because future managers are not prepared for the world they will enter, and that new manager’s expectations often exceed reality, displaying feelings of frustration, anxiety, under-utilisation and disappointment. Emphases are on theory rather than the synthesis of theory and practice that prepare managers for the challenges of the actual world. Social systems and social behaviour (and in the case of organisations, individual and group behaviour) can be defined and explained in terms of values, norms, communities and ensuring individual roles. In this context, Fararo, (2001), highlights a number of theoretical propositions derived from behavioural psychology thus:

i. Behaviour is the result of the benefits it yields. This means that a set of actions taken

in an environment describe our behaviour which therefore are modelled in line with

the outcomes of earlier made decisions.

ii. Social behaviour is an exchange process. From this perspective, it is defined as a

social interaction between behavioural systems. It is termed “action and reaction”

(Fararo, 2001). It is grounded in the benefits by an individual from another

individual’s behaviour and it takes the form of sociability, cooperation and

competition.

The theoretical principles accounting for individual and group behavioural differences that

have continued to pose challenges to managers especially in-service organisations in the

words of Homans as cited by Schneider (1995) are formulated thus:

I. The success principle: the more frequent an action’s reinforcement, the greater the

likelihood of that action being repeated.

II. The principle of stimuli similarity: similar situations yield general reinforcing effects.

In effect, if a certain stimulus was used in an action reinforce previously, the more

future stimuli resemble that specific stimulus, the greater the chances of identical or

similar performance actions to the one previously reinforced.

III. The value principle: the more the results of an action are valued, the greater the

chances of repeating that very action.

IV. The deprivation/sufficiency principle: this means that the more frequent a reinforce is

applied, the less valuable the latter becomes to an individual.

V. The aggressive/approval principle: if the reward or punishment received for certain

action contradicts the individual’s expectation, there may be emotional reaction and

the likelihood of increase in aggressive behaviour.

However, at the end, the results may be positively valued – the aggressive principle. On the other hand, if the reward for a specific action meets or even exceeds the individual’s expectations or an action is not punished as expected, the chances of valuing the results of the resultant behaviour and, hence, of repeating it increases – the approval principles. All these variations, differences and dynamism in behavioural pattern of organisation members are serious challenges to management as well as attainment of corporate objectives of organisations most especially banking industry considering the pivotal role it plays in economic development of a country. Bagraim, Cunningham, Potgieter&Viedge (2007) explain that the study of organisational behaviour provides a guideline that both managers and workers can use to understand the many forces that influence behaviour, and make correct decisions about how to motivate and coordinate people and other resources to achieve optimum performance. It leads to better understanding of peers, supervisors and subordinates within the organisation. Better still, the understanding of the dynamic interaction between the various components leads to personal growth and knowledge for one’s own benefit. Robbins and Judge (2010) agree that organisations consists of components that are independent of each other and are grouped into three levels of individual, group and the structure and design of the formal organisation. Understanding how these levels influence behaviour is relevant in banking industry where customer relationship is presumed to be more on one-on-one basis.

Nigerian banking sector has been undergoing series of transformation and consolidation to

strengthen it and since the behaviour of the workers is critical to the survival of the industry,

it becomes important to evaluate the influence certain behaviour variables have on the

behaviour of bank workers in the Nigerian banking sector.

On the performance and growth of banking industry in Nigeria, Ekanem (2003) asserts that

the banking industry in Nigeria has expanded rapidly with productivity rising sharply since

1996. This growth over the years in the sector has been organically and intrinsically linked

with the growth of employees who are veritable source of competitive advantage (Omojafor,

2012). In the midst of this expansion and rapid growth of the banking sector are the

challenges of managing the diverse workforce associated with the complexity of behaviour to

sustain the growth. These behaviours have significant impact on performance and

productivity. The first task of a manager is to identify the critical behaviours – the 5% to 10%

of the behaviours that may account for up to 70% or 80% of the performance in the area in

question (Luthans, 1985).

In a 4-P model of strategic results (people, product, process and productivity) Kreitner and

Kinicki (2003) stress the importance of day-to-day continuous improvement in all aspects of

organisational endeavour to cope with the more demanding customers and stiffer competition. The banking industry in Nigeria has been faced with enormous challenges that affect performance, management and reliability. The 24 banks in Nigeria today that are referred to as consolidated banks emerged after the recapitalisation initiative of the Central Bank of Nigeria in 2005 after raising the minimum capital requirement for each bank to N25 billion. Banks constitute an important vehicle for economic growth and sustainable development in Nigeria. To sustain this important role requires effective management of their employees which can be made possible by understanding their behaviour. Management is the process of working with and through others to achieve organisational objectives in an efficient and ethical manner (Kreitner and Kinicki, 2003). From the standpoint of organisational behaviour, the central feature of this definition is ‘working with and through others.

Considering the importance of behaviour management to the survival of organisations, there is a dearth of empirical studies on the influence of organisational behaviour on the management of employees in the Nigerian Banking Industry. There is a problem of the difficulty in establishing the extent to which employees in the Nigerian banking sector can be managed through the application of organisational behaviour variables to obtain desirable behaviour. This is the gap this research intends to fill. Therefore, the central focus of this study is to identify the influence organisational behaviour variables of motivation, leadership style, communication, organisational culture and group membership have on managing behaviour in Nigerian Banking Industry. This is critical and therefore supports the objectives of this research.

1.2 Statement of the Problem

Comprehensive research has been done on organisational behaviour, managing behaviour and

challenges/prospects of managing behaviour in organisations. Such research merely guides

managers on how organisations are structured and create appreciation for the importance of

effective management of behaviour.

However, findings indicate that there are few empirical evidence that organisational

behaviour influences employee performance and overall behaviour in Nigerian banking

industry. In view of the peculiar nature of banking systems in Africa and Nigeria in

particular, there is the need to establish the relationship between the growth rate in terms of

assets base of money deposit banks in Nigeria and the behaviour of the workers. This creates

an avenue for managers and business leaders on when and how to encourage positive

behaviour within the industry where worker – customer relationship is more direct-oriented

and personal. Why are some banks having more customers than others; could it be attributed

to behaviour of workers or some other factors? This study therefore intends to fill the existing

gap by examining the influence some key organisational behaviour variables have in

managing employee behaviour in the Nigerian banking industry. This is critical to the

survival of the sector considering the degree of competition both locally, nationally and internationally.

1.3 Objectives of the Study

The broad objective of this research is to provide an analysis of the variables relevant to

managing behaviour in the Central Bank of Nigeria.

The central focus of the study therefore is to establish the influence organisational

behaviour variables have on managing employee behaviour in service organisations. The

study selected organisational behaviour variables of motivation, leadership style, group

membership, organisational culture and communication as subject scope and distinct

objectives. As a result of this, the research fulfils the following specific objectives:

1. To determine the extent to which motivation leads to job satisfaction and desirable

behaviour in Central Bank of Nigeria.

2. To examine the effect of leadership style on absenteeism in Nigerian banking

industry.

3. To ascertain the effect of communication on employee creativity in Nigerian banking

industry.

1.4 Research Questions

For proper understanding of the problem under study, the following research questions

emanating from the set objectives are formulated:

1. To what extent does motivation lead to job satisfaction and desirable behaviour in Central Bank of Nigeria?

2. What is the effect of leadership style on absenteeism of Nigerian bank employees?

3. What effect has communication on creativity of employees of Nigerian banking

industry?

1.5 Research Hypotheses

Hypothesis I

H0: Motivation significantly does not lead to job satisfaction of workers in Nigerian banking industry.

Hi: Motivation significantly leads to job satisfaction of workers in Nigerian banking industry.

Hypothesis II

H0: Leadership style, to a large extent, negatively affects absenteeism of bank workers in Nigerian banking sector.

Hi: Leadership style, to a large extent, positively affects absenteeism of bank workers in Nigerian banking sector.

Hypothesis III

H0: Communication as a social process has no positive effect on creativity of employees in Nigerian banking industry.

Hi: Communication as a social process has positive effect on creativity of employees in

Nigerian banking industry.

1.6 Significance of the Study

This study will be of immense benefit to other researchers who intend to know more on this study and can also be used by non-researchers to build more on their research work. This study contributes to knowledge and could serve as a guide for other study.

1.7 Scope of the Study

Organisational behaviour is a very wide field of study and therefore the scope of this study is

on selected organisational behaviour variables of motivation, leadership style,

communication, group membership and organisational culture. The independent variables

therefore, are motivation, leadership style, communication, membership of group and

organisational culture. The dependent variables are job satisfaction, absenteeism, creativity, group norms and socialisation. The organisations selected for this research is the central bank of Nigeria.

1.8 Limitations of the study

The demanding schedule of respondents made it very difficult getting the respondents to participate in the survey. As a result, retrieving copies of questionnaires in timely fashion was very challenging. Also, the researcher is a student and therefore has limited time as well as resources in covering extensive literature available in conducting this research. Information provided by the researcher may not hold true for all research under this study but is restricted to the selected respondents used as a study in this research especially in the locality where this study is being conducted. Finally, the researcher is restricted only to the evidence provided by the participants in the research and therefore cannot determine the reliability and accuracy of the information provided. Other limitations include.

Financial constraint: Insufficient fund tends to impede the efficiency of the researcher in sourcing for the relevant materials, literature or information and in the process of data collection (internet, questionnaire and interview).

Time constraint: The researcher will simultaneously engage in this study with other academic work. This consequently will cut down on the time devoted for the research work.

1.9 Definition of Terms

Ambiguity: In the context of this study, it means that job responsibilities as assigned to the

workers are not clearly defined /spelt out.

Attitude: This refers to the behaviour of the workers and their disposition to the bank

customers.

Behaviour: This refers to natural reaction in response to a particular situation which

influences employees’attitude variously.

Benchmarking: It refers to the bank’s assessment of the performance and practices of other

organisations and competitors in an attempt to analyse and compare its own performance.

Career: This means the sequence of jobs bank employees hold during their work histories in

the organisation.

Coalition: This means two or more groups within the bank combing their resources to outwit

others in the same bank.

Cohesiveness: This is a process of employees forming a united whole; causing employees to

become united.

Compliance/conformity: This refers to power applied by group in the bank to control its

members in relation with the kinds of involvement developed by members of that group.

Conflict: This means incompatibility of individual employees due to differences arising from opposing behaviours at the individual or group level.

Emotions: This refers to a state of physiological arousal of employees in the banks and

changes in facial expressions, stress, positive and subjective feelings.

Feedback: It is an appraisal and feedback of employees regarding their work activities in the bank.

Hygiene factors: These are factors within a job that serve to prevent dissatisfaction.

Leadership: It refers to a relationship through which subordinates influence the

actions/behaviours of employees in the banks.

Misbehaviour: This means intentional action by employees of the banks that defies and

violates shared banking norms and expectations as well as core societal values and standards

of proper conduct.

Motivation: It refers to employees’ willingness to exert high levels of efforts towards

organisational goals conditioned by the effort’s ability to satisfy some individual needs. The individual forces account for the directions, level and persistence of a person’s effort

expended at work.

Norms: This means codes and practices developed by a group in the bank that group

members consider to constitute proper group behaviour.

Organisation: It refers to banks that exist in order to achieve specific goals by means of

planned and coordinated activities.

Perception: This is a cognitive process of employees and it is basically bits of information that involve the ways in which people process that information.

Power: It means the level of control/influence a subordinate has over the behaviour of other employees in the bank either with or without his approval.

Role: In the context of this study, it means the expected pattern of behaviour with employees in the bank occupying a particular position within the structure of the bank.

Socialisation: This refers to continuous integration and behavioural modification of employees in the bank as he/she climbs the ladder of his/her career.

Socio-technical: This is a process that is concerned with the interactions of the psychological and social factors of bank workers and its structural and technological requirements. Precisely, it is the interface between the technological system and the social system that recognises the capability of employees.

Stress: This is the mental and physical response of employees to the changes and challenges of his/her lives. It is usually caused by some characteristics, events, or situations in the environment that in some way results in a potentially disruptive consequence.

Values: These are the manners in which an employee or a group of employees tends to make judgment or choices both about goals and means at different stages of one’s life, in different facets of it, as deemed to lead to the happiness of oneself and society.

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