A Study On Which Methods of Performance

A STUDY ON WHICH METHODS OF PERFORMANCE
APPRAISAL IS EFFECTIVE AS A MOTIVATOR TO

INCREASE THE EMPLOYEE PERFORMANCE AMONG
LECTURES AND STAFFS AT UNISEL SHAH ALAM
MOHAMAD FAZLY BIN ZAINAL

NURAFIQAH BT MADON
FACULTY OF BUSINESS
UNIVERSITI SELANGOR
AUGUST 2013
A STUDY ON WHICH METHODS OF PERFORMANCE
APPRAISAL IS EFFECTIVE AS A MOTIVATOR TO
INCREASE THE EMPLOYEE PERFORMANCE
AMONG LECTURES AND STAFFS AT UNISEL SHAH
ALAM
MOHAMAD FAZLY BIN ZAINAL
NURAFIQAH BT MADON
THIS PROJECT PAPER IS SUBMITED TO FULFILL THE PARTIAL REQUIREMENTS

FOR THE DEGREE IN
BACHELOR OF HUMAN RESOURCE MANAGEMENT
TO THE
FACULTY OF BUSINESS
UNIVERSITI SELANGOR
AUGUST 2013
APPROVAL PAGE
This project paper entitled “A STUDY ON WHICH METHOD OF PERFORMANCE
APPRAISAL IS EFFECTIVE AS A MOTIVATOR TO INCREASE THE EMPLOYEE
PERFORMANCE AMONG LECTURES AND STAFFS AT UNISEL SHAH ALAM” was
prepared and submitted by MOHAMAD FAZLY BIN ZAINAL and NURAFIQAH BT
MADON as a partial fulfilment of the requirement for BACHELOR OF HUMAN
RESOURCE MANAGEMENT (HONS) in hereby read and approved by:
……………………………. …………………….
Madam Noor Nasyikin Md. Zain Date

Supervisor
Faculty of Business
Universiti Selangor (UNISEL)
i
DECLARATION AND COPYRIGHT PAGE
Name : Mohamad Fazly Bin Zainal
Matrix number : 41020051461
Name : Nurafiqah Binti Madon
Matrix number : 4102005121
We hereby declare that this research is the result of our own investigations, except where
otherwise state. Other sources are acknowledged by footnotes giving explicit references and
bibliography is appended.
Signature………………………….. Date……………………………
Mohamad Fazly Bin Zainal
Singnature………………………. Date……………………………..
Nurafiqah Binti Madon
ii
ACKNOWLEDGEMENT
First of all, Alhamdulillah and thanks to God for giving us the encouragement to face all barriers
and shortcoming while completing the project paper. We would like to thank our supervisor of
this project paper, for always giving us advice and guidance during the conduct of our research.
Thank you for your criticism and supervision in the success of this project paper.
Besides that, we would also like to express our sincerely appreciation to all that contributed until
project paper successfully completed especially respondent from the lectures and staffs who gave
their full cooperation for spending their precious time and effort to answer our questionnaires.
With the valuable information and respond given towards performance appraisal. It has helped
us to progress in our research. We are truly grateful for all the commitment given by the
respondents and thankful for all their help.
Finally, thanks to our parents, friends who give me guidance, support ideas, views and sharing
some of their knowledge to us either directly or indirectly and especially project paper partner,
we went out and tries to perform our best to fulfil the project paper.
Thank for all commitment in this project paper.
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LIST OF TABLES
Table 1: Gender of Respondents 44
Table 2: Age of Respondents 45
Table 3: Marital status of Respondents 46
Table 4: Years of services for Respondents 47
Table 5: Reliability Statistics for Section B 48
Table 6: Awareness of Employee on Performance Appraisal 49
Table 7: Relationship between Performance Appraisal and Employee 51

Performance
Table 8: Supervisor Appraisal Method 53
Table 9: Peer Appraisal Method 55
Table 10: Self-Appraisal Method 57
Table 11: 360-Degree Feedback Method 59
Table 12: Descriptive Statistic Result 61
Table 13: Pearson Correlation Matrix Results 62
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LIST OF FIGURES
Figures 1: Theoretical Framework 34
Figure 2: Gender of Respondents 44
Figure 3: Age of Respondents 45
Figure 4: Marital Status of Respondents 46
Figure 5: Years of Services for Respondents 47
Figure 6: Awareness of employee on performance appraisal 50
Figure 7: Relationship between performance appraisal and employees 52

performance
Figure 8: Supervisor Appraisal Method 54
Figure 9: Peer Appraisal Method 56
Figure 10: Self-Appraisal Method 58
Figure 11: 360-Degree Feedback Method 60
Figure 12: Research Diagram Appendix I
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ABSTRACT
This study will explore on the understanding which methods of performance appraisal is
effective as a motivator to increase the employee performance among lecture and staffs at
UNISEL Shah Alam with 120 respondents at the faculty, aged between 20 and above 40 years
old that have been chosen randomly for this research. This research are looking for the
awareness of employees on performance appraisal, the relationship between performance
appraisal and employee performance and the most effective method of performance appraisal.
The data and information were collected using questionnaires that was distributed to lecture and
staffs and being analysed using the Statistical Package Social Science (SPSS). The findings show
that the top management and lecture also staffs must understand the performance appraisal
systems and performance appraisal must start with effective performance planning. Training also
can be implements to know the purpose and how to effectively use the performance appraisal.
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TABLE OF CONTENT
Approval Page і
Declaration and Copyright Page іі
Acknowledgement ііі
List of Table vіі
List of Figures vііі
Abstract іx
CHAPTER 1: INTRODUCTION
1.1 Introduction 1
1.2 Background of study 4
1.2.1 History of UNISEL 4
1.2.2 Background faculty at UNISEL Shah Alam 5
1.2.3 Department of Student Affairs 6
1.3 Problem Statement 8
1.4 Objective of the Study 9
1.5 Research Questions 10
1.6 Hypothesis 11
1.7 Significance of Study 12
1.8 Limitation of Study 14
1.9 Definition of terms 16
1.10 Organization of the Project Paper 18
CHAPTER 2: LITERATURE REVIEW
2.1 Introduction 20
2.2 Nature of performance appraisal 21
2.2.1 Performance evaluation and rating worker performance 21
2.3 Performance appraisal 23
2.4 Sources of performance ratings 24
2.4.1 Supervisor appraisal 25
2.4.2 Self-appraisal 25
2.4.3 Peer appraisal 26
2.4.4 360-degree feedback 26
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2.5 Factor influence managers tend to use performance appraisal 27
2.5.1 Appraisal sources and performance appraisal fairness 27
2.5.2 Appraisal fairness and motivation 28
2.5.3 Appraisal characteristic and appraisal accuracy 29
2.6 Summary 30
CHAPTER 3: RESEARCH METHODOLOGY
3.1 Introduction 31
3.2 Research Design 32
3.2.1 Type of Research 32
3.2.2 Purpose of Study 32
3.2.3 Research Method 33
3.3 Theoretical Framework 34
3.4 Population and Sample Size 35
3.4.1 Population 35
3.4.2 Sample Size 35
3.5 Instrumentation 36
3.6 Data collection 37
3.6.1 Primary data 37
3.6.2 Secondary data 39
3.7 Proposed data analysis 39
3.7.1 Reliability 40
3.7.2 Descriptive analysis 41
3.7.3Correlation Coefficient 41
3.8 Summary 42
CHAPTER 4: DATA ANALYSIS AND FINDINGS
4.1 Introduction 43
4.2 Section A: Demographic Profile 44
4.2.1 Gender of respondents 44
4.2.2 Age of respondents 45
4.2.3 Marital status of respondents 46
4.2.4 Services of respondents 47
4.3 Section B: Awareness, relationship and method of performance appraisal 48
4.3.1 Reliability test 48
4.3.2 Awareness of Employee on Performance Appraisal 49
4.3.3 Relationship between Performance Appraisal and Employee 51
Performance
4.3.4 The Effective Method on Performance Appraisal 53
4.4 Correlation Coefficient 61
4.5 Summary 65
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CHAPTER 5: CONCLUSION AND RECOMMENDATIONS
5.1 Introduction 66
5.2 Discussion 67
5.3 Conclusion 69
5.4 Recommendations 70
5.5 Summary 72
BIBLIOGRAPHY
APPENDIX I
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CHAPTER 1
INTRODUCTION
1.1 Introduction
Many contemporary authors have defined the concept of performance appraisal. A formal
definition of performance appraisal is the systematic evaluation of the individual with respect to his
or her performance on the job and his or her potential for development. In the organizational
context, performance appraisal is a systematic evaluation of personnel by supervisors or others
familiar with their performance (L.M. Prasad). According to Dessler (2008), he defines performance
appraisal as evaluating an employee’s current and past performance relative to his or her
performance standards.
A more comprehensive definition is performance appraisal is the formal, structured system of
meaning and evaluating an employee’s job related behavior and outcome to discover how and why
the employee is presently performing on the job and he the employee can perform more effectively
in the future so that the employee, organization and society get the benefit (Faseeh Ullah Khan,
2013). Snell and Bohlander defines (2007) performance appraisal as a process, typically performed
or delivered by a supervisor to a subordinate, designed to help employees understand their roles,
objectives, expectations and performance success

1
A success performance appraisal process should demonstrate a change in both the rating of
employee’s performance and aspects of the work environment that impact upon work performance.
By using formal system performance appraisals, it can give many advantages if they are designed
and implemented properly. Performance appraisals may increase employee’s commitment and
satisfaction (Wiese and Buckley, 1998). According to Saiyadain (1998), the basic purpose of
performance appraisal is to judge the relative worth or ability of an individual employee in
performing his/her tasks. If objectively done, appraisal can help to identify a better worker from a
poor one.
Performance can be defined as the achievement of specified task measured against
predetermined or identified standards of accuracy, completeness, cost and speed. In an employment
contract, performance is deemed to be the accomplishment of a commitment in such a manner that
releases the performer from all liabilities laid down under the contract. Efficiency and effectiveness
are ingredients of performance apart from competitiveness, productivity and training which ways of
increasing an individual’s performance.
Good performance means how well employees performed on the assigned tasks (Cooke, 2000).
Kenney et al., (1992) stated that employee's performance is measured against the performance
standards set by the organization. Performance of an individual can be defined as the record of
outcomes produced as specified job functions or activities during a specified time period (Bernardin
2007).
2
The term performance refers to a set of outcome produced during a certain period of their job
time and does not refer to the traits, personal characteristics, or competencies of the performer. On
the other hand, performance is also defined as the accomplishment of the certain given task. This
performance usually measured against standards of accuracy, completeness, cost and speed in
completing task (Gilbert, 1978)
In organization, employee is refers to a person who works for another in return for financial or
other compensation. However, the legal definition of “employee” is concerned with more than the
pay received by a worker for services provided. Black’s Law Dictionary defines “employee” as a
person in the service of another under any contract of hire, express or implied, oral or written, where
the employer has the power or right to control and direct the employee in the material details of how
the work is to be performed (5th edition, 1979). The relationship between performance appraisals
and to increase the employee performance is they should use this opportunity to communicate about
appreciation for the employee’s contribution. Besides that, employer should inform the employee of
his or her overall performance appraisal and the criteria needed in determining the rating.
3
1.2 Background of study
The sample of this research is UNISEL employees who are in the faculty and also the
Department of Student Affairs. In this research, researcher wants to know and understand which
method of performance appraisal is effective as a motivator to increase the employee performance
among lectures and staffs at UNISEL Shah Alam.
1.2.1 History of UNISEL
University Selangor (UNISEL), formerly known as University Industri Selangor was established
on 23 August 1999. UNISEL operated on two campuses; the main campus is in the area of 1000
acre campus in Bestari Jaya, Kuala Selangor and the city campus at Jalan Zircon , Section 7, Shah
Alam. UNISEL establishment is in line with the State of Government’s wishes in order to make
UNISEL as one of the leading regional education hub. Selangor should play a more active role in
the delivery of higher education programs to enhance the development of excellent human capital.
As an institution of higher learning (IPTS) in Malaysia ranking at seventh place, UNISEL is unique
because it is a state-owned university in Malaysia.
UNISEL begins with an urban campus in Section 7, Shah Alam. Moreover, the Shah Alam
campus now has five faculties which are Faculty of Communication and Media, Faculty of
Biomedical & Health Science, Faculty of Art and Design, Faculty of Business and UNISEL
Graduate School of Management.
4
However, researcher only focuses on faculty staff because the faculty at UNISEL Shah Alam has
a large number of staff such as academic staff and administrative staff. Beside that, the research also
focuses on the Department of Student Affairs which includes administration and discipline unit,
international students unit, welfare unit and activities and counseling unit.
1.2.2 Background Faculty at UNISEL Shah Alam
Faculty of Communication and Media has commit to produce graduates who are ready for
newspaper organizations, TV and radio broadcasting stations, cable television networks as well as
magazines and websites publication. The Faculty of Communication and Media have 19 academic
staffs and 4 administrative staff
Faculty of Biomedical and Health Sciences was established in 2004 and offer a quality academic
program in the health care. These programs provide students with an opportunity to develop their
expertise, scientific knowledge, and professional attitudes that will enable them to contribute to the
health of society. Under the Faculty of Biomedical and Health Science have 30 academic staffs and
also 11 administrative staff.
Faculty art and design aims to provide graduates with high quality education in technical
knowledge, communication and marketing skills, creativity and design innovation, visual expression
and also communication in art and design. Faculty Art and Design offers a professional photography
education with an emphasis on the conceptual, technical and aesthetic possibilities of the medium.
5
Faculty of Business (FOB) of University Selangor (UNISEL) integrates the fields of technology
and management, and administration knowledge. The faculty also encourages students to acquire
knowledge with characteristics of technological advancements and co-curricular activities in order
to prepare. Under the Faculty of Business have 76 lectures from academic staff and also there were
10 people from administrative staff.
However in this research, the researcher only focuses on the Department of Student Affairs
because it is one of the key departments in UNISEL which includes Administration and Discipline
unit, International Students unit, Health and Welfare unit and Activities and Counseling unit.
1.2.3 Department of Student Affairs
Department of Student Affairs (HEP) is one of the key departments in UNISEL. It specifically
established to serve the welfare of the students. Under the Department of Student Affairs there are
some units such as Administration and Discipline unit, International Students unit, Welfare unit and
Activities and Counseling unit.
Administration and discipline unit formerly known as unit of activities and student discipline.
The unit is placed under the Department of Student Affairs UNISEL headed by the Deputy Vice
Chancellor of Student Affairs. This unit was originally headed by the Director of Student Affairs on
July 1, 2002 and on October 1, 2003.
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International Students Office of UNISEL is a Centre to serve the needs and assist international
students in settling down to tertiary education at the university. The office is not only provides
information but also consider as a student’s advisory Centre for international student
Health and Welfare Unit has been formed and this unit is available in both campuses. The areas
that being focused by this unit are to manage emergency help and look after students welfare in
cases such as sickness, accidents, death of the students and handle insurance scheme and claims.
The function of activities unit is to coordinating, supervising, motivating coach and provides
guidance on the application paperwork association activities or clubs, financial application and
implementation activities of the association or club to be in line with the aspirations and procedures
outlined and monitor the activities.
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1.3 Problem statement
Performance appraisal is a measurement of how well someone performs job relevant task (
Parrill, 1999 ). These measurements are normally done by the direct supervisor of the rate and can
serve different organizational purposes. Examples are employee selection, disciplinary action,
development or feedback, promotion, training and personnel planning.
Unfortunately, there will be a significant impact with dissatisfaction with type and amount of
feedback and uncomfortable feeling due to the lack of control. Especially the way of feedback
giving has the potential to arouse negative emotions which in turn negatively affect the acceptance
of the performance appraisal system. This partially stems from the fact that performance appraisal
has an impact upon an employee’s sense of self-worth (Rarick and Baxter, 1984).
The lack of user acceptance resistance and a reduction in user motivation (Roberts, 2003) and
can result in the undesirable closure of communication between leader and employee around the
performance issue (Davis and Landa, 1999). In summary, it can be concluded that performance
appraisal systems become useless if they do not elicit positive reactions among raters and rates
(Tziner and Kopelman, 2002).
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1.4 Objectives of the study
The purpose of this study is to study which method of performance appraisal is effective as a
motivator to increase the employee’s performance at UNISEL Shah Alam. The researcher has made
specific objectives which are:-
1. To identify the awareness of employee on method of performance appraisal that can
influence their job performance.
2. To determine the most effective method of performance appraisal that UNISEL can
adapt to increase the employee’s performance.
3. To describe the relationship between performance appraisal and employee performance.
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1.5 Research question
The proposed system specifically aims to present several question to the entire study. The
research questions are as follows:-
1. Are the employees aware on the method of performance appraisal that can influence their
job performance?
2. What is the most effective method that employer can adapt to increase employee
performance?
3. What is the relationship between performance appraisal and employee performance.
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1.6 Hypotheses
Hypothesis 1
H1: There is significant relationship between supervisor appraisal and employee performance
Ho: There is no significant relationship between supervisor appraisal and employee performance
Hypothesis 2
H1: There is significant relationship between self-appraisals and employee performance
Ho: There is no significant relationship between self-appraisals and employee performance
Hypothesis 3
H1: There is significant relationship between peer appraisals and employee performance.
Ho: There is no significant relationship between peer appraisals and employee performance.
Hypothesis 4
H1: There is significant relationship between 360-degree feedback and employee performance.
Ho: There is no significant relationship between 360-degree feedback and employee
performance.
1.7 Significance of study
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Before creating a performance appraisal, there are several factors to consider. The employer
should first determine the objectives for the appraisal. Secondly, the employer should develop a plan
and time frame for launching the appraisal. Finally, the employer should prepare for any obstacles
that might appear, and regularly consider ways to improve the appraisal. Perhaps the most
significant benefit of appraisal is that, in the rush and bustle of daily working life, it offers a rare
chance for a supervisor and subordinate to have a “time out” for a one-on-one discussion of
important work issues that might not otherwise be addressed.
Almost universally, where performance appraisal is conducted properly, both supervisors and
subordinates have reported the experience as beneficial and positive. Appraisal offers a valuable
opportunity to focus on work activities and goals, to identify and correct existing problems, and to
encourage better future performance.
This research will help the public to find out about the performance appraisal is very important
in the organization in a company because when performance is conducted right in the company,
their employees will be able to improve their performance through the method of performance
appraisal. Performance appraisals can also be practiced by the company that would like to improve
their worker level of job performance of an employee.
Performance appraisals will be evaluated by their supervisor and if there is a positive
evaluation, their performance will also increase. If they show good performance, they will be given
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benefits such as bonuses, pay, merit and rewards. This research also might help the reader on getting
some input and information if they want to know how to improve their performance. Readers also
might define themselves with performance appraisal; they can influence their job performance and it
can affect their reward system.
In this research, the literature review, research methodology, findings and conclusion also can
help other researchers or readers to find some guideline if they intend to make a research on the
same field or to gain information about the topic of performance appraisal in the future, this research
can be their reference if they want to study about this topic.
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1.8 Limitation of study
There are many possible limitations that researcher may have faced, some of the problems may
deface the researcher report. The quality of information and quantity of pages may affect the
researcher problems. The limitations to this research are:-
i. Poor time management
One of the problems encountered by the researcher during the conduct of this study is
poor time management. As the researcher has to complete this research study and a few
other subjects in the same semester, time is a major constraint for this researcher. The
researcher faces difficulty to manage his time among attending lectures, conducting
questionnaire survey, and collecting secondary data. As a result, the researcher had to
delay some of the topics of the study to the following weeks.
ii. Financial constraint
The expenses incurred during the conduct of this researcher are too expensive for the
researcher who depends solely on PTPTN education loan. The researcher has to spend
money on printing journals and articles, photocopy questionnaires, community to firms
and libraries, and motorbike fuel charge. In short, the financial constraint delayed the
field work of this research.
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iii. Lack of information
Not all the information’s are available in the internet. There is very little for our journal
references. Thus, we do not get a lot of impact information for this topic. Besides, not
many respondents answered correctly, so many reject information that we had to throw
away. So we do not have the sufficient information to make the reference.
iv. Self-report bias
Many of the staff in UNISEL is not going to answer all researcher questions very well,
they do not have the time to entertain the researcher, and do not want to help researcher
in answering questions that been provided. Therefore, the research question is not
answered properly and might be a false report to the researcher.
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1.9 Definition of terms
Definitions used are the language that may not be understood by others. Therefore the
researcher explains more detail about the definition of term such as:-
i. Employee
An individual who works part-time or full-time under contract of employment, weather
oral or written express or implied, and has recognized right and duties
ii. Performance appraisal
The process by which manager or supervisor examines and evaluates an employee’s
work behavior by comparing it with present standards usually carried out annually,
documents and the results of the comparison, and uses the results to provide feedback to
the employee to show where improvements are needed and why. Performance appraisals
are employed to determine who needs what training, and who will be promoted,
demoted, retained, or fired.
iii. Motivation
Motivation is an inner drive to behave or act in a certain manner. Motivation is a
psychological feature that arouses an organism to act towards a desired goal and elicits,
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controls, and sustains certain goal-directed behaviors. It can be considered a driving
force, a psychological one that compels or reinforce an action toward a desired goal.
iv. Effectiveness
Effectiveness is the capability of producing a desired result. When something is deemed
effective, it means it has an intended or expected outcome, or produces a deep vivid
impression.
v. Efficiency
A level of performance that describes a process that uses the lowest amount of inputs to
create the greatest amount of outputs. Efficiency relates to the use of all inputs in
producing any given output, including personal time and energy.
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1.10 Organization of the Project Paper
This research contains five chapters. The chapters are organized as follow:
Chapter 1: Introduction
The purpose of this chapter is to state the research problems, issues, hypotheses that will be
examined in the project paper. This should provide the background of the study and indicate to
the reader in general terms what the research intends to study. Generally, the following sub-
sections are included in writing the introduction chapter of project paper which is background of
the study, objectives of the study including research question and hypotheses, significance of the
study, limitations of the study, definition of terms and lastly organization of the project paper.
Chapter 2: Literature Review
The main purpose of the literature review is to expand upon the context and background of
the study, to further define problem and to provide empirical and theoretical bases for the
research. This chapter needs to clarify the relationship between the proposed study and previous
work conducted on the topic. Sub-heading should reflect the major variables of the literature
review. It is recommended that the sub-section under each sub-heading begin with the sentence
introducing the purpose, content or relevance of the literature reviewed in the sub-section and
end with a sentence summarizing the conclusions or trends evident from the literature reviewed
in that sub-section.
Chapter 3: Research Methodology
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The methodology in this chapter describes the exact steps that will be undertaken to address
the hypotheses and research questions. The aim of this chapter is to provide a complete
description of the specific steps to be followed, in sufficient detail, to allow a reader to replicate
the study.
Chapter 4: Data Analysis and Findings
Tables and data analysis are usually essential to data analysis and finding in this chapter.
With the next describing in words what are shown in the tables and graphs. Most data analysis
and finding chapters begin with a description of the sample.
Chapter 5: Discussion and Conclusion
In the introduction, literature review, methodology, and data analysis and findings chapters,
the details of the research dictate the content, but not in the conclusions chapter. The points
raised in the introduction chapter must be responded to in the conclusion chapter.
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CHAPTER 2
LITERATURE REVIEW
2.1 Introduction
This chapter reviews the scholarly literature on nature of performance appraisal, sources of
performance ratings and the factors that influence manager to use the performance appraisal. First
of all, the nature of performance appraisal and several parts of good performance appraisal are
introduced. There are two parts that must consist to create a good performance appraisal which are
performance evaluation and rating workers performance. In addition, the concepts of the parts of
good performance appraisal in a literature are described. Secondly, the literature review about the
method of performance appraisal is effective as motivators to increase the employee performance
are discussed. Next, the discussions on the source of performance ratings are discussed. Lastly,
researcher also discussed the factors that influence the manager to use the performance appraisal.
Generally, the study of performance appraisal method is dominated in organization in order to
know that performance appraisal is effective as a motivator to increase the employees. Obviously,
the main purpose of performance appraisal is to judge the relative worth or ability of an individual
employee in performing his or her task (Saiyadin, 1998). If objectively done, appraisal can help to
identify a poor worker from a better one.
20
Therefore, this research is designed to address some of the issues in the literature such as do the
performance appraisal is effective method and how it relates to increase the employee performance.
This research explores the method of performance appraisal is effectives as a motivator to increase
the employee performance at UNISEL Shah Alam.
2.2 Nature of performance appraisal
A good performance appraisal should consist of two parts. The first part is the performance
evaluations and the second part is rating workers performance
2.21 Performance evaluation and rating worker performance
In the past two decades, research on performance appraisals has focused more on the cognitive
process underlying performance appraisal decision and how an evaluator arrives at an overall
evaluation of a workers performance (Bretz, Milkovich & Read, 1992). According to Ilgen, Barnes-
Farrel & Mckellin (1993), the research views performance appraisal as complex such as looking at
how information about the performance is acquired, how the evaluator organizes and store
information about workers and how the evaluator retrieves and translate the stored information.
The results of several studies suggest that evaluators from ongoing or “online” evaluations of
other (Murphy, Philbin & Adams, 1989). That is, evaluators from opinions as they observe behavior
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day to day, rather than just waiting until the time a formal performance rating is required and then
forming an opinion based solely on memory
Evaluation of performance is an ongoing, information processing task, evaluators should be
presented with the performance appraisal rating instruments up front, so they can familiarize
themselves with the rating dimensions before they can begin to observe and evaluate the
performance (Woehr, 1992). Having this knowledge of rating dimensions beforehand has been
shown to increase the agreement between supervisor rating and self-ratings of workers performance
(Williams & Levy, 1992).
In addition, it may be helpful for evaluators to keep diaries or daily records of individual
employee performance. It has been found that using diaries as a means for structuring information in
memory increase the accuracy of evaluators recall. In research, evaluators who used diaries to
record performance information were more accurate in their recall and in their appraisals of workers
performance (DeNisi & Peters, 1996; Cafferty, 1989)
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2.3 Performance appraisal
Different researchers have a different meaning of performance appraisal. Generally,
performance appraisal is the measurement of work and its results by using the scale and index.
Measurement of an activity is done by activity and comparison of its results with a criterion that we
can evaluate the desired quantity and quality precisely. However, Scott (2009) defined performance
is the way through which employees perform their duties and the evaluation is judging the
performance of employees.
In a formal sense, performance appraisal of an individual began in the Wei dynasty (A. D. 261-
265) in China, where an Imperial rate appraisal the performance of members of the official family
(Monappa and Mirza, 1997). The common terms used include merit rating, behavioral assessment,
employee evaluation, personnel review, staff assessment, progress report, and performance
appraisal. The most widely used term is performance appraisal (Prasad, 2005). Armstrong (2001)
notes that in performance appraisals, accuracy and fairness in measuring employee performance is
very important.
Armstrong (2001) also notes that in performance appraisals, accuracy and fairness in measuring
employee performance is very important. Performance management is a control measure used to
determine deviations of work tasks with a view of taking corrective action. It is also used to reflect
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on past performance as the organization plans ahead. Provision of feedback on the required
corrective action is critical in the process.
For the appraisals to be effective, the top management must be supportive in providing
information, clear performance standards must be set, the appraisals must not be used for any other
purpose apart from performance management, and the evaluations must be free from any rating
biases (Goff & Longenecker, 1990)
2.4 Source of performance ratings
Performance ratings play such an important role in performance assessment in organization.
According to Jacobs (1986), in the majority cases, it is immediate supervisors who rate the
performance or direct reports. However, performance appraisal also can be made by workers, peers,
subordinates and the worker himself.
The obvious advantages of getting different perspectives seeing different aspect of the workers
performance and thus may offer a unique perspective (Conway, Lombardo & Sanders, 2001).
Moreover, multiple perspective performance appraisals can have increased reliability and create
sense of fairness (Harris & Schaubroeck, 1988).
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2.4.1 Supervisor appraisal
By far, most performance appraisal is performed by supervisors. Supervisor performance
appraisals are so common because supervisors are usually quite knowledgeable about the job
requirement, are often in a position to provide rewards for effective performance. This is probably
why research has consistently demonstrated that supervisory ratings have higher reliability (Conway
& Huffcutt, 1996). In addition, the test-retest reliability of supervisor rating is quit high (Salgado,
Moscoso & Lado, 2003)
2.4.2 Self-appraisals
Self-appraisals of performance have been used by many companies, usually in conjunction with
supervisor appraisals. Self-appraisal tends to be more lenient and focus more on effort exerted rather
than on performance accomplishment (Wohlers, Hall & London, 1993). One advantages of appraisal
discrepancies, however, maybe that they highlight differences in supervisor and worker perceptions
and can lead to an open dialogue between supervisor and supervisee (Campbell & Lee, 1988). Self-
appraisals of performance are also useful in encouraging workers to be more committed to
performance-related goals (Riggio & Cole, 1992). Although studies of U.S workers have found that
self-appraisal tend to be more lenient than supervisor performance rating, a study of Chinese
workers found that their appraisal showed a “modesty bias” (Farh, Dobbins & Cheng, 1991)
25
2.4.3 Peer appraisals
Although the actual use of peer ratings of performance is quite rare, evidence indicates that
there is good agreement between performance ratings made by peers and those made by supervisors
(Conway & Huffcutt, 1996). This makes sense because both supervisors and peers have opportunity
to directly observe workers on the job. With the increased emphasis on coordinated work teams,
peer appraisals of performance may be greater importance now and in the future. Other research
findings that have a problem with peer appraisal in other country such as have a conflict among
employee who are evaluating each other (DeNisi, Randolph & Blencoe, 1983)
2.4.4 360-degree feedback
A comprehensive form of performance appraisal gathers ratings from all levels in what is
commonly called 360-degree feedback (London & Beatty, 1993). In 360-degree feedback,
performance ratings are gathered from supervisors, peers, customer’s subordinates. The advantages
use 360-degree feedback includes improved reliability of measurement because of the multiples
evaluations and involvement of more organizational members in evaluations and feedback process.
According to Muhammad Faseeh ullah khan (2013), based on their research at Indian companies,
360 degree feedback system is not very popular. Among the companies under study, this system has
been implemented in TITTAN and GODREJ. This system can be adopted and its success only in the
presence of an open presence of open organizational climate. In addition, according to Borman
(1998), there have been calls for more research to demonstrate the advantages of 360-degree
evaluation over less comprehensive and costly performance appraisal programs
26
2.5 Factors that influence managers tend to use performance appraisal
According to the studies another important factor in determining the effectiveness of
performance appraisal system is the acceptance of its users. In the past research, Roberts (2003)
emphasized that employees must have trust on the accuracy and fairness of performance appraisal
system, otherwise they are tremendous waste of time and money spend on implementation and
development. According to Roberts (2003), employee participation in all aspects of appraisal
process is a key element of intrinsic motivational strategies that facilitate workers’ development and
growth. Employee participation gives opportunity to interject their voice. Moreover, it generates an
atmosphere of co-operation and trust which reduces defensive behavior and rater-rate conflict. Since
the study conducted in UNISEL Shah Alam and focusing to the faculty and Department Student
Affairs, researchers only focus to appraisal sources, appraisal fairness and appraisal characteristic.
2.5.1 Appraisal source and performance appraisal fairness
The past research in performance appraisals suggests that employees often perceive their
appraisals to be unfair (Cardy and Dobbins 1994; Heslin and Vanderwalle 2009). Traditional
performance appraisals are performed by the employee’s immediate supervisor who is often the only
source of employee performance appraisal. When appraisals are conducted only by supervisors, they
can be subject to biasing influences (Ilgen and Barnes-Farrell 1984; Cardy and Dobbins 1994;
Smither and London 2009), and this can lead employees to perceive that appraisals are unfair.
27
In contrast, London and Smither (1995) states in past research that when performance appraisals
are conducted by multiple sources, biases due to supervisory feedback may be mitigated, and
employees may perceive such appraisals as more fair. Employees who receive performance ratings
from multiple sources may be more willing to accept such ratings as fair when compared to ratings
received from a single source (McCarthy and Garavan 2007). That is, multisource ratings will result
in more distributive fairness compared to single-source ratings. In addition, a multisource appraisal
environment may ensure better procedural fairness compared to a supervisory appraisal, which is
subject to bias (Narcisse and Harcourt 2008).
2.5.2 Appraisal fairness and motivation
Organizational researchers have suggested that fairness perceptions can be a source of
motivation for employees (Weiss, Suckow and Cropanzano 1999; Krehbiel and Cropanzano 2000)
The basis for the motivational effects of fairness perceptions is the self-determination theory (Deci
and Ryan 2000), which posits that employees can be motivated when their fundamental needs are
met. Cropanzano, Rupp, Mohler and Schminke’s (2001) states in their research there are some
indicates that fair treatment is an important fundamental need, and when employees perceive that
they are fairly treated, it can provide a motivational basis for future performance improvement.
Performance appraisal research in this area suggests that when employees perceive their appraisals
to be unfair, they may ignore the feedback and not use the appraisal feedback to further improve
their performance (Waldman and Bowman 1998).
28
2.5.3 Appraisal characteristic and appraisal accuracy
Perceived accuracy, which measures employee perceptions of the accuracy of performance
ratings, is an important qualitative indicator of user acceptance of performance appraisals (Lam and
Schaubroeck, 1999). The past research in performance appraisal suggests that user acceptance is
increased if performance appraisal systems are perceived to be more accurate (Werbel and Bedeian,
1988; Roberts, 1992). That is, when employees perceive their performance ratings to be more
accurate, they tend to accept the performance appraisal as a valid indicator of their performance and
thus may have more positive reactions toward performance appraisal (Lam and Schaubroeck, 1999).
If employees feel that their appraisals are more accurate, they are more likely to buy into the
appraisal system and participate in the performance appraisal process and actions that are based on
appraisals (Miller and Thoronton, 2006).
2.6 Summary
Based on the above explanation, there are many reasons or factors that influence manager tend
to use performance appraisal. Therefore, in this study are going to identify the reasons that manager
use performance appraisal as well as to identify is there any relationship between factors and
performance appraisal.
29
CHAPTER 3
RESEARCH METHODOLOGY
3.1 Introduction
Research in common parlance refers to a search of knowledge. According to Walliman
(2005), research is not just about gathering facts without purpose, or presenting information or
data without interpretation. Rather, research is something which is undertaken to find out things
in a systematic manner where data is collected and interpreted systematically and there is a clear
purpose guiding the enquiry (Saunders, Lewis &Thornhill, 2009).
Methodology refers to the methods that researcher used in order to conduct a research to
attain the objectives. This chapter will describe the exact steps that will undertake to address the
hypothesis and research question. The aim of this chapter is to provide a complete description of
the specific steps to be followed, insufficient detail to allow reader to replicate the research. It is
also beneficial and important part to achieve effective and appropriate finding in any research.
This chapter will discuss about research design, population and sample size,
instrumentations, data collection and data analysis.
31
3.2 Research Design
A research design is a master plan that specifies the methods and produces for collecting and
analysing the needed information. It provides a framework or plan of action for the research. The
researcher must determine the sources of information, the design technique (survey or
experiment), the sampling methodology and the schedule and cost of research (Zikmund, Babin,
Carr & Griffin, 2013)
3.2.1 Type of Research
This research is using quantitative research. Quantitative research relies on deductive
reasoning or deduction (Sekaran & Bougie, 2010) and makes use of variety of quantitative
analysis techniques that range from providing simple descriptive of the variables involved, to
establishing statistical relationships among variables through complex statistical modelling
(Saunders et al., 2009). Quantitative methods provide information which is easy to analyze
statically and fairly reliable.
3.2.2 Purpose of Study
This study is descriptive study. Descriptive analysis is the discipline of quantitatively
describing the main features of collecting data or the quantitative description itself. Descriptive
analysis is to describe characteristics of objects, people, groups, organization or environments
(Zikmund, Babin, Carr & Griffin, 2013). Explanatory study is also called causal study because it
seeks to study cause and affect relationship between different variables in the study.
32
3.2.3 Research Method
The methods that will be used in this research in order to address the issues and get the
information are:-
1. Study the primary data
2. Descriptive analysis
3. Correlation
As a conclusion, in order to achieve the objectives of the research, the data were collected to
ratify the objective of this study. It essential to identify the relationship between independent
variable (IVs) which individual factors (awareness of employee and performance of employee)
and dependent variable (DVs) which is performance appraisal can be clearly identified. Thus, the
research design is important for this study in order to ensure the objective of the study is
achieved.
33
3.3 Theoretical Framework
Independent variables (IV) Dependent variable (DV)
Effectiveness of method
Supervisor appraisal Employee performance

Self-appraisals
Peer appraisals
360-degree feedback
Figure 1: Theoretical Framework
Variable is anything that differs or changes from one instance to another. It can display
differences in value, usually magnitude, strength or direction (Zikmund, Babin, Carr & Griffin,
2013). In descriptive and causal research, the term dependent variable and independent variable
describe different variable types.
A dependent variable is a process outcome or a variable that is predicted and or explained by
other variables. Dependent variables are usually represented by the letter Y. In this research, a
dependent variable is employee performance (refer to Figure 1)
Meanwhile, independent variable is a variable that is expected to influence the dependent
variable in some way. Independent variables are usually represented by the letter X. In this
research, independent variables (refer to Figure 1) are effectiveness of method (supervisor
appraisal, self-appraisals, peer appraisals and 360-degree feedback).
34
3.4 Population and Sample size
3.4.1 Population
A population is any complete group that shares some set of characteristic (Zikmund et al,
2010). Examples of population are a group of people, companies and stores. The target
population that researcher choose for this research are Faculty at UNISEL Shah Alam and also
Department of Student Affairs.
3.4.2 Sample size
A sample is a subset or some part from a larger population. The variability of a statistic
from a random sample does not notably depend on the size of the population. The larger is the
sample size, the more sure researchers can be that their answer truly the population (Zikmund,
Babin, Carr & Griffin, 2010). By using sample, researchers save lot of time and money, get more
detailed information, and they are able to get information which may not be available otherwise
(Bluman, 2009). Since the population of this research is large, researcher only takes employees
include academic and administrative staff from any faculty at UNISEL Shah Alam which is
consist Faculty of Communication and Media, Faculty of Biomedical and Health Science,
Faculty Art and Design and Faculty of Business and also takes employee from Department of
Students Affairs from the population to be the sample size for this research. The respondents are
required to answer the related topic about research. The respondent will answer questionnaires
related to the research that has been conducted. However, the researchers only collected raw data
via questionnaires survey from 120 employees as a sample size.
35
3.5 Instrumentation
The instrumentation that been used in this research is questionnaire. The questionnaire
divided into three sections which are part A, B and C. The questionnaire was distributed to 120
employees from faculty at UNISEL Shah Alam and also Department of Student Affairs. Section
A was comprised of demographic question or background of respondent. This section contains
items such as sex, age, gender, department/faculty and years of services. Section A is close
ended question. Where the respondents only need to tick at the most suitable answer in the box
provided.
Section B will examine the awareness of employees (A), performance of employees (P) and
the effectiveness of performance appraisal (E). Section B is close ended question and has
nineteen items of question. Section B was using five-point Likert scale which ranged from
“strongly disagree” to “strongly agree”.
Lastly, section C is discussed on to get the opinion or suggestion on improving performance
appraisal is effective method to increase employee performance in UNISEL Shah Alam. This
part is an open-ended question.
36
3.6 Data Collection
According to Wikipedia, data collection is any process of preparing and collecting the data
for a similar project. Data collection is an essential component to conducting research. Data
collection is a complicated and hard task. By and large it is also very difficult to say which the
best method of data collection is. O’Leary (2004, p. 150) remarks “Collecting credible data is a
tough task, and it is worth remembering that one method of data collection is not inherently
better than another.”
The purpose of collecting data is to get hold of information so as to keep on record and to
make decisions about important issues. Data collection is a process of preparing and collecting
data for future use. There are two types of method that used in data collection and can be
considered when collecting the data for research purpose which is primary data and secondary
data.
3.6.1 Primary data
Primary data is collected specifically to address the problem in question and is conducted by
the decision maker, a marketing firm, a university or extension researcher. Unlike secondary
data, primary data cannot be found elsewhere. Primary data may be collected through surveys,
focus groups or interviews, or through experiments. Primary data usually undertaken after the
researcher has obtained some insight into the issues by reviewing secondary research.
37
Primary research diagram show the flow of primary research (refer Appendix I). Primary
data also have an advantage such as the researcher can give more attention on qualitative or
quantitative issues. Besides, the researcher can control the search design by address the specific
research issues. Then, it also enables the researcher to have a higher control over how the
information is collected.
However, primary data also have a disadvantage in-term of cost because primary data is
more expensive in preparing and carrying out the research. The researcher use the questionnaire
an it can be incurred in producing the paper for survey. In order to be done properly, primary
data collection requires the development and execution of a research plan. It takes longer to
undertake primary research than to acquire secondary data.
i. Questionnaire
Questionnaire is divided to three sections which are section A, B and C. Questionnaire is a
closed-ended question for sections A and B and open-ended question for section C. Open-
ended questions allow respondent to answer in any way they choose by giving suggestion or
opinion. In contrast, closed-ended questions would ask respondent to make choice among set
of alternative that be given by the researchers. Closed question might help the respondent to
make a quick decision about the several alternatives. It also helps the researcher to code the
information easily. Questionnaire constructed by five-point Likert scale
38
3.6.2 Secondary data
Secondary data is data collected by someone other than the user or the data that have existed
and already available from any resources. Example of secondary data are organizational records,
government publications, qualitative methodologies or quantitative research. The advantages of
using secondary data are saves time that would otherwise be spent collecting data. Other than
that, the methods are economical. Secondary data are cheaper and faster in order to gained data
rather than primary data. It also may available when primary data cannot be obtained at all.
A clear benefit of using a secondary data is that much of background work needed has
already been carried out. For example, literature review and case studies might have been
carried out, published text and statistics could have been already used elsewhere.
3.7 Proposed data analysis
When the researcher is finished with the data collection through the respondent via
questionnaire, the data analysis needs to be done. Importantly, the data should be accurate,
complete and suitable for further analysis (Sekaran & Bougie, 2010). Researcher has to record
and arrange the data and then apply various descriptive and inferential statistics or econometrics
concepts to explain the data and draw inferences (Saunders et al, 2009). The researcher need to
arrange the questionnaire according to serial number stated on the questionnaires.
39
The gathered data are then will be key in and analyzed using the Statistical Package for
Social Sciences (SPSS). SPSS is a comprehensive system for analyzing data. SPSS can take data
from almost any type of file and use them to generate tabulated reports, charts, and plots of
distributions and trends, descriptive statistics, and complex statistical analysis.
SPSS has scores of statistical and mathematical functions, scores statistical procedures, and
a very flexible data handling capability. It can read data in almost any format (numeric,
alphanumeric, binary, dollar, date, time formats). It also has excellent data manipulation utilities.
There are three proposed types of data analysis used in the research which are:
3.7.1 Reliability
Reliability is the degree to which a measure is free from random error and therefore gives
consistent results. It indicates internal consistency of the measurement device. It refers to the
accuracy and precision of a measurement procedure (Thorndike, Cunningham, Thorndike,
&Hagen, 1991). Other than that, reliability is an indicator of a measures internal consistency.
Consistency is the key to understanding reliability. According to Cooper & Schindler (2003), it
can be expressed in terms of stability, equivalence and internal consistency.
40
3.7.2 Descriptive analysis
Descriptive analysis is the discipline of quantitatively describing the main features of
collecting data or the quantitative description itself. Descriptive analysis is to describe
characteristics of objects, people, groups, organization or environments (Zikmund, Babin, Carr
& Griffin, 2013). Descriptive analysis is distinguished from inductive statistic, in that descriptive
statistic aim to summarize a sample, rather than use the data to learn about the population that
the sample of data is thought to represent. Descriptive statistics help us to simply the large
amounts of data in sensible ways. Each descriptive statistic reduces lots of data into a simple
summary.
3.7.3 Correlation Coefficient
Correlation analysis is one of the most widely used and reported statistical methods in
summarizing medical and scientific research data. In this article the basic aspects of correlation
analysis will be reviewed with emphasis placed upon the interpretations and limitations of the
correlation coefficient. No focus will be given to the actual calculation of this statistical value.
The correlation coefficient or r coefficient is a statistic used to measure the degree or
strength of this type of relationship. The correlation coefficient is often referred to as Pearson’s
product-moment r or r coefficient. Coefficient is calculated by taking the covariance of two
variables and dividing by the standard deviation of their products.
41
3.8 Summary
This chapter provided an overview of the methods to be used in this study about which
method of performance appraisal is effective as a motivator to increase the employee
performance among lecture and staff at UNISEL Shah Alam. In conclusion, this chapter studies
about research methodology how the data will be collected, what method and data used in the
study and how to gather information from respondents. In this study, researcher also can identify
the population and sample size that used in this study.
42
CHAPTER 4
DATA ANALYSIS AND FINDINGS
4.1 Introduction
This chapter describes about research findings that had been done at the faculty in UNISEL
Shah Alam. About 120 respondents were chosen from all the faculties which including lecturers
and staffs to answer the questionnaires that had been distributed.
SPSS version 16.0 was used to analyse all the questionnaires obtained from the respondents.
The results were presented in the form of tables and charts
43
4.2 Section A : Demographic Profile
4.2.1 Gender of respondents
Table 1: Gender of Respondents
Gender
Cumulative
Frequency Percent Valid Percent Percent
Valid Male 45 37.5 37.5 37.5
Female 75 62.5 62.5 100.0
Total 120 100.0 100.0
GENDER
37%
male
63%
female
Figure 2: Gender of Respondents
The statistic showed that most of the respondents are female which constituted 75
respondents that emphasized 62.5%. The remaining of 37.5% respondent, are male which
constituted of 45 of respondents. Figure 2 shows that female respondents are the major gender in
this study.
44
4.2.2 Age of respondents
Table 2: Age of respondents
Age
Frequency Percent Valid Percent Cumulative Percent
Valid 20-30 years 32 26.7 26.7 26.7
30-40 years 75 62.5 62.5 89.2
Above 40 years 13 10.8 10.8 100.0
Total 120 100.0 100.0
Age
> 40
years
20-30 years
30-40 years
Figure 3: Age of Respondents
From the study that had been done, the highest group of age that involved in performance
appraisal is about 62.5% which is group between 30-40 years old. For respondents between 20-
30 years old is about 26.7% and for group above 40 years old is about 10.8%.
45
4.2.3 Marital status of respondents
Table 3: Martial status of Respondents
Marital Status
Valid Married 91 75.8 75.8 75.8
Unmarried 29 24.2 24.2 100.0
Total 120 100.0 100.0
Marital Status
24%
married
unmarrried
76%
Figure 4: Marital Status of Respondents
Figure 4 shows that 75.8% respondents were married which is the highest percentage. This
is because the most of married consists of lecturers and staffs. Meanwhile, another 24.2% of
respondents are unmarried.
46
4.2.4 Services of respondents
Table 4: Years of services for respondents
Years of Services
Valid BELOW 2 YEARS 2 1.7 1.7 1.7
2-6 YEARS 39 32.5 32.5 34.2
6-10 YEARS 59 49.2 49.2 83.3
ABOVE 10 YEARS 20 16.7 16.7 100.0
Total 120 100.0 100.0
Years of Services
2%
17%
32% < 2 years

2.6 years
6-10 years
> 10 years
49%
Figure 5: Years of Services for Respondents
Figure 5 shows the years of services for respondents. From the study that had been done, the
highest group of services involved in performance appraisal is about 49.2% which is between 6-
10 years of services. The second highest is for respondents between 2-6 years which is about
32.5% and 16.7% for years of services above 10 years. The smallest percentage is 1.7% for years
of services below 2 years.
47
4.3 Section B: Awareness, relationship and method of performance appraisal
4.3.1 Reliability Test
Table 5: Reliability Statistics for Section B
Reliability Statistics
Cronbach's Alpha N of Items
.858 38
In section B of questionnaire, there are 38 question (N of Items) which are used to the awareness,
relationship and effective method of performance appraisal. Table 5 shows the result of the
reliability test conducted on the items. It is found that the Cronbach’s Alpha is high as 0.858 for
the 38 items. The reliability coefficient is considered as very good and acceptable. Therefore,
Section B of the questionnaire is acceptable and reliable
48
4.3.2 Awareness of Employee on Performance Appraisal
1 2 3 4 5
No. Items
F % F % F % F % F %
Performance appraisal
A1 system is needed in - - - - - - 10 8.3 110 91.7
organization.
Satisfied with the existing
A2 performance appraisal in 1 0.8 16 13.3 36 30.0 49 40.8 18 15.0
organization.
The performance
appraisal helps to win
A3 2 1.7 6 5.0 30 25.0 61 50.8 21 17.5
cooperation and
teamwork
The performance
appraisal helpful in
A4 2 1.7 10 8.3 30 25.0 59 49.2 19 15.8
reducing grievance among
employees.
Conflict arises between
employees after
A5 - - 13 10.8 29 24.2 51 42.5 27 22.5
performance appraisal is
made.
Does performance
A6 appraisal process help to 1 0.8 3 2.5 33 27.5 54 45.0 29 24.2
raise organization goal?
Appraisal system is keeps
on the major achievement
A7 - - 10 8.3 24 20.0 76 63.3 10 8.3
and failure or success of
work.
Does any change arise
after appraising the
A8 1 0.8 6 5.0 34 28.3 71 59.2 8 6.7
performance of
employee?
If I have problems with
my performance
evaluation, I can
A9 1 0.8 5 4.2 38 31.7 67 55.8 9 7.5
communicate my
concerns openly to my
supervisor.
Table 6: Awareness of Employee on Performance Appraisal
1=Strongly Disagreed, 2=Disagreed, 3=Neither Agreed, 4=Agreed, 5=Strongly Agreed
***F= Frequency
%= Valid Percent
49
A9
A8
A7
A6
A5
A4
A3
A2
A1
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Strongly Disagree Disagree Neither Agree Agree Strongly Agree
Figure 6: Awareness of employee on performance appraisal
The Table 6 shows the result of awareness of employee on performance appraisal. From the
result above, majority of the respondents (91.7%) strongly agreed that performance appraisal
system is needed in an organization. Most of the respondents agreed (63.3%) that appraisal
system is keeps on the major achievement and failure or success of work. Higher percentage on
neither agreed (31.7%) said if they have problems with performance evaluation, they can
communicate the concerns openly to a supervisor. However, there is 13.3% who disagreed on the
statements of A2. In conclusion, respondents viewed that performance appraisal is needed in an
organization
50
4.3.3 Relationship between Performance Appraisal and Employee Performance
1 2 3 4 5
No. Items
F % F % F % F % F %
The performance appraisal

R10 helps to win cooperation 1 0.8 - - 15 12.5 69 57.5 35 29.2
and team work
R11 system increases employee 1 0.8 - - 19 15.8 6.8 56.7 32 26.7
motivation.
R12 is helpful for improving 1 0.8 1 0.8 11 9.2 67 55.8 40 33.3
personnel skill
system helps to identify
R13 1 0.8 - - 18 15.0 56 46.7 45 37.5
the strength and weakness
of the employee
R14 reflects objectively my 1 0.8 3 2.5 33 27.5 56 46.7 27 22.5
performance
Does performance
R15 evaluation serves on the 1 0.8 5 4.2 51 42.5 52 43.3 11 9.2
basis of job satisfaction?
Does performance
R16 evaluation serves on the - - 8 6.7 49 40.8 51 42.5 12 10.0
basis of promotion?
Performance management
can help people understand
R17 1 0.8 5 4.2 23 19.2 77 64.2 14 11.7
the organization's strategic
priorities
makes me better
R18 1 0.8 11 9.2 18 15.0 70 58.3 20 16.7
understand what I should
be doing
I receive adequate training
and information about the
R19 1 0.8 24 20.0 21 17.5 63 52.5 11 9.2
performance appraisal
cycle before it starts
Table 7: Relationship between Performance Appraisal and Employee Performance
1=Strongly Disagree, 2=Disagree, 3=Neither Agree, 4=Agree, 5=Strongly Agree
***F= Frequency
%= Valid Percent
51
R19
R18
R17
R16
R15
R14
R13
R12
R11
R10
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
Figure 7: Relationship between performance appraisal and employees performance
Table 7 shows the result of a relationship between performance appraisal and employee
performance. From the result above, majority of the respondent (64.2%) agreed that performance
management can help people understand the organization's strategic priorities Most of the
respondents neither agreed (42.5%) that performance evaluation serves on the basis of job
satisfaction. Higher percentage on strongly agreed (37.5%) said that the performance appraisal
system helps to identify the strength and weakness of the employee. However, there is 20.0%
disagreed on the statements of R19. In conclusion, respondents viewed that performance
appraisal is helping employees to understand the organization strategic.
52
4.3.4 The Effective Method on Performance Appraisal
Table 8: Supervisor Appraisal Method
1 2 3 4 5
No. Items
F % F % F % F % F %
My supervisor gives me
feedback that helps me
S20 4 3.3 7 5.8 22 18.3 57 47.5 30 25.0
improve my
performance
My supervisor tries to
understand my point of
S21 view when he or she 2 1.7 12 10.0 27 22.5 69 57.5 10 8.3
discuss problems or
project with me.
I receive coaching and
S22 training from my 2 1.7 16 13.3 40 33.3 51 42.5 11 9.2
supervisor
I feel my job
S23 performance is fairly - - 11 9.2 45 37.5 54 45.0 10 8.3
evaluated
My supervisor is
S25 1 0.8 12 10.0 43 35.8 50 41.7 14 11.7
impartial
***F= Frequency
%= Valid Percent
53
S25
S23
S22
S21
S20
0% 20% 40% 60% 80% 100%
Figure 8: Supervisor Appraisal Method
Table 8 shows the result of effective method on performance appraisal for supervisor appraisal
method. From the result above, majority of the respondent (57.5%) agreed that supervisor tries to
understand the employee point of view when he or she discusses their problems or project with
the employees. Most of the respondents neither agreed (37.5%) that job performance is fairly
evaluated. Higher percentage on strongly agreed (25.0%) said that supervisor gives feedback
which could help improving the employee performance. There is 13.3% disagreed on the
statement of S22. However, there is 3.3% respondents who strongly agreed that supervisor gives
the feedback to improve their performance. In conclusion, respondents viewed that supervisor
tried to give employee point of view when discuss the problems.
54
Table 9: Peer Appraisal Method
1 2 3 4 5
No. Items
F % F % F % F % F %
The feedback from my

PA26 - - 4 33.3 26 21.7 84 70.0 6 5.0
peers was constructive
The feedback from my

PA27 peers was clear and - - 9 7.5 28 23.3 80 66.1 3 2.5
understandable
Help employees learn how
to receive and give
PA28 feedback which is an - - 5 4.2 28 23.3 76 63.3 11 9.2
important part of most
work contexts
My feedback should be
PA29 useful for revising the - - 2 1.7 23 19.2 82 68.3 13 10.8
paper
***F= Frequency
%= Valid Percent
55
PA29
PA28
PA27
PA26
0% 20% 40% 60% 80% 100%
Figure 9: Peer Appraisal Method
Table 9 shows the result of effective method on performance appraisal for peer appraisal method.
From the result above, majority of the respondents (70.0%) agreed that the feedback from peers
was constructive. However, 33.3% of respondents disagreed that feedback from peers was
constructive. Another 23.3% the respondents are neither agreed for the PA27 and PA28.
However, there is 10.8% strongly agreed that feedback should be useful for revising the paper. In
conclusion, respondents viewed that feedback from peers was constructive.
56
Table 10: Self-Appraisal Method
1 2 3 4 5
No. Items
F % F % F % F % F %
I like to give myself challenges

SA30 - - 1 0.8 10 8.3 86 71.7 23 19.2
when I take on a new project
I am fairly at ease in difficult

SA31 - - 10 8.3 26 21.7 70 58.3 14 11.7
situations
I always worry about what

SA32 others will think before doing 2 1.7 12 10.0 28 23.3 57 47.5 21 17.5
something important
I am a lot less effective in

SA33 1 0.8 19 15.8 26 21.7 60 50.0 14 11.7
stressful situations
When faced with difficulties, I

SA34 - - 2 1.7 19 15.8 76 63.3 23 19.2
look for alternative solutions
***F= Frequency
%= Valid Percent
57
SA34
SA33
SA32
SA31
SA30
0% 20% 40% 60% 80% 100%
Figure 10: Self-Appraisal Method
Table 10 shows the result of effective method on performance appraisal for self-appraisal
method. From the result above, majority of the respondents (71.7%) agreed that they like to take
challenges when handling a new project. Most of the respondents neither agreed (23.3%) that
they worried about what the others will think before doing something important. There is a
higher percentage on strongly agreed (19.2%) on the statements of SA30 and SA34. However,
there is 15.8% who disagrees that respondents are less effective in stressful situations. In
conclusion, respondents viewed that they like to take challenges when handling a new project.
58
Table 11: 360-Degree Feedback Method
1 2 3 4 5
No. Items
F % F % F % F % F %
I would prefer my performance
to be evaluated additionally by
D35 my colleagues because they have - - - - 14 11.7 56 46.7 50 41.7
relevant performance
information and insight.
Being appraised by several
sources (supervisor, peers, and
D36 customers) would enhance the - - 3 2.5 15 12.5 62 51.7 40 33.3
accuracy of performance
appraisals.
Being appraised by several
sources (supervisor, peers, and
customers) would provide me
D37 - - 3 2.5 20 16.7 61 50.8 36 30.0
with valuable information about
different important aspects of my
performance.
I would like to give my
D38 supervisor feedback on his/her - - 1 0.8 15 12.5 71 59.2 33 27.5
performance.
Appraising my own performance

D39 would enhance my awareness of - - - - 18 15.0 72 60.0 30 25.0
my performance.
***F= Frequency
%= Valid Percent
59
D39
D38
D37
D36
D35
0% 20% 40% 60% 80% 100%
Figure 11: 360-Degree Feedback Method
Table 11 shows the result of effective method on performance appraisal for 360-degree feedback
method. From the result above, majority of the respondent (60.0%) agreed that appraising their
own performance would enhance their awareness of performance. Most of the respondents
strongly agreed (41.7%) that respondents would prefer their performance to be evaluated
additionally by colleagues because they have relevant performance information and insight.
16.7% of the respondents neither agreed that being appraised by several sources (supervisor,
peers, and customers) would provide them with valuable information about different important
aspects of their performances. However, there is 2.5% disagrees on the statements of D36 and
D37. In conclusion, respondents viewed that appraising their own performance would enhance
the awareness of their performance.
60
4.4 Correlation Coefficient
Table 12: Descriptive Statistic Result
Descriptive Statistics
N Minimum Maximum Mean Std. Deviation
Employee Performance 120 1 5 3.82 .722
Supervisor Appraisal 120 1 5 3.85 .976
Peer Appraisal 120 2 5 3.77 .590
Self-Appraisal 120 2 5 4.09 .550
360-Degree Feedback 120 3 5 4.10 .627
Valid N (listwise) 120
Descriptive statistic such as maximum, minimum means and standard deviations were obtained
for the interval-scaled independent and dependent variables. The results are shown in Table 12.
All variables are measured on a 5-point Likert scale. From the results, it shown that the mean of
360-degree feedback method is 4.10. Therefore, people were agreed that appraising employee
own performance could enhance the awareness of the employee performance. The mean on self-
appraisal method is 4.09. The result shows that most respondents agreed to give themselves
challenges when take on a new project. Besides that, the mean result for the supervisor appraisal
method is 3.85. Most respondent strongly agreed that supervisor gives feedback that helps
respondents to improve their performances. The mean on relationship between performance
appraisal and employee performance is 3.82. The respondents agreed that performance
management can help people to understand the organization's strategic priorities. The lowest
mean is peer appraisal method (3.77) which was that the respondents agreed that feedback from
peers was constructive.
61
Table 13: Pearson Correlation Matrix Results
Correlations
performance supervisor peer self 360 Degree

** **
performance Pearson Correlation 1 .271 .017 .254 -.052
Sig. (2-tailed) .003 .853 .005 .573
N 120 120 120 120 120

** *
supervisor Pearson Correlation .271 1 -.134 .214 -.016
Sig. (2-tailed) .003 .144 .019 .858
N 120 120 120 120 120
peer Pearson Correlation .017 -.134 1 .066 .154
Sig. (2-tailed) .853 .144 .471 .092
N 120 120 120 120 120

** *
self Pearson Correlation .254 .214 .066 1 .022
Sig. (2-tailed) .005 .019 .471 .812
N 120 120 120 120 120
360 Degree Pearson Correlation -.052 -.016 .154 .022 1
Sig. (2-tailed) .573 .858 .092 .812
N 120 120 120 120 120
**. Correlation is significant at the 0.01 level (2-tailed).
*. Correlation is significant at the 0.05 level (2-tailed).
Table 13 shows the result from Pearson correlation matrix. From the results, we can see that
employee performance significantly positively correlated to supervisor appraisal and self-
appraisal method. The results are as follows:
62
i. Hypothesis 1
H1: There is significant relationship between supervisor appraisal and employee
performance
Ho: There is no significant relationship between supervisor appraisal and employee
performance
Based on Table 13, supervisor appraisal method correlated to employee performance. The
significant of supervisor appraisal is 0.003 which means it is less than 0.05. Therefore, there is
significant relationship between supervisor appraisal and employee performance at the level
significant 0.05. H1 of Hypothesis 1 is supported.
ii. Hypothesis 2
H1: There is significant relationship between self-appraisals and employee
performance
Ho: There is no significant relationship between self-appraisals and employee
performance
From the table above, researcher found that self-appraisal (sig=0.005) is correlated to
employee performance. The self-appraisal method is less than 0.05 level of significant.
Therefore, there is significant relationship between self-appraisal and employee performance at
the level significant 0.05. H1 of Hypothesis 2 is supported.
63
iii. Hypothesis 3
H1: There is significant relationship between peer appraisals and employee
performance.
Ho: There is no significant relationship between peer appraisals and employee
performance.
Based on the results, researcher found that peer appraisal method (sig=0.853) is more than
the level of significant at 0.01 and 0.05. Therefore, there is no significant relationship between
peer appraisal and employee performance. This is because peer appraisal method is not an
effective method as a motivator to increase employee performance at UNISEL Shah Alam.
Therefore H1 of Hypothesis 3 is rejected. Meanwhile, Ho is accepted.
iv. Hypothesis 4
H1: There is significant relationship between 360-degree feedback and employee
performance.
Ho: There is no significant relationship between 360-degree feedback and employee
performance.
Based on the table, researcher found that 360-degree feedback method (sig=0.573) is more
than the level of significant 0.01 and 0.05. Therefore, there is no significant relationship between
360-degree feedback and employee performance. H1 of Hypothesis 4 is rejected. Meanwhile, Ho
is accepted.
64
4.5 Summary
The data collected from 120 respondents had been analysed through the Statistical Package
of Social Science (SPSS) version 16.0. Based on the study done by researcher, it was found that
supervisor appraisal and self-appraisal method influence most in performance appraisal. All table
and figures were illustrated from the data have been analysed using SPSS version 16.0
65
CHAPTER 5
CONCLUSION AND RECOMMENDATIONS
5.1 Introduction
Chapter five provides an overview of the research study, summarizes the research
findings through the discussion of study on which method of performance appraisal is effective
as a motivator to increase the employee performance among lecturers and staffs at UNISEL Shah
Alam. The purpose of this study is to explore which method of performance is effective for
lecturers and staffs in UNISEL Shah Alam. Specifically, this study aims at analyzing any
possible significant relationship between performance appraisal and factors that influence
employee performance (supervisor appraisal, peer appraisal, 360-degree appraisal and self-
appraisal). This study also determines the perception of lecturers and staffs towards performance
appraisal in UNISEL.
This chapter provides a general description on the purpose of study undertaken at
lecturers and staff in UNISEL Shah Alam apart from a summary of the major findings. Some
recommendations would also be suggested based on the study undertaken and the findings
observed
66
5.2 Discussion
In UNISEL, the performance appraisal demonstrated among lecturers and staffs is more
or less influences by their perceptions. There are few factors that have been explored in order to
gather the information on the real situation at UNISEL Shah Alam.
Based on the study, it can be concluded that employee’s perception towards performance
appraisal is positive. They viewed that performance appraisal is needed in an organization. The
reason for this might be because they believed that they can increase their performance through
these methods. It helps the employees to know where they stand in the organization and also to
identify the problems in their work and to overcome them. This fact indirectly creates the
practices towards performance appraisal among lecturers and staffs and help enhance employees
enjoying making performance appraisal.
Furthermore, employees think that supervisory appraisal is effective to be motivated by
them to increase the employee’s performance. Supervisor is one of the factors that influence
employee performance because supervisor can discuss the job responsibilities and identify
options for acquisition of additional skills and knowledge to foster performance improves and
career growth. Besides, supervisor can review whether previous discussed performance
expectations and goals have been made. Therefore, it shows that employees agreed that
supervisory appraisal is an important method to them.
67
Another factor that leads to effective method to increase employee’s performance is self-
appraisal. Self-appraisal provides employees with the opportunity to systematically assess their
performance. Studies indicate that self-appraisal increase employee preparation and readiness for
the appraisal interview, enhances overall satisfaction, increase perceived appraisal fairness and
can reduce defensive behavior it used for development purpose.
Besides, employee’s feels that peer appraisal process is not an effective method as a
motivator because it can pick out any obvious omissions and errors. It is impossible for the
reviewers to detect determined fraud without replicating the experiment. It also can cause
lengthy delays in the dissemination of research findings. Thus, peer appraisal is not an effective
method to increase employee’s performance. Another perception on the research on Nancy
Reese-Durham, peer reviewers, and peer evaluation activity was meaningful and effective.
Reviewers were confident that their feedback was constructive and helpful.
There are numerous authors who propose definitions of the 360-degree feedback process.
Feedback from multiple sources or 360-degree appraisal is a performance appraisal approach
that relies on the input of an employee’s supervisors, colleagues, subordinates, sometimes
customers, suppliers or spouses. The 360-degree evaluation can help one person be rated from
different sides and different people which can give a wider prospective of the employee’s
competencies. However, the employees in UNISEL feel that 360-degree is not effective because
this method provide challenging feedback.
68
In summary findings, it can be concluded that one of the most important findings
presented in this study is that there is a significant relationship between supervisory appraisal,
self-appraisal, peer appraisal and 360-degree appraisal. As the data been analyzed, the researcher
found that there is significant relationship of employee performance to supervisory appraisal and
self-appraisal. However, there is no significant relationship to peer appraisal and 360-degree
appraisal.
5.3 Conclusion
The objective of this study is to investigate which method of performance appraisal is
effective among lecturers and staffs at UNISEL Shah Alam. There are four factors corresponding
for the effectiveness of method, which are supervisor appraisal, self-appraisal, peer appraisal and
360-degree feedback, from previous related studies were identified and defined. A questionnaire
was used for collecting data and 120 respondents including employees and staffs from UNISEL
Shah Alam participated in this study.
The results indicated that supervisor and self-appraisal had significant influence on
employee performance among lecturers and staffs respectively. Specifically, supervisor and self-
appraisal are correlated to employee performance whereas peer and 360-degree feedback is not
correlated to employee performance.
69
Therefore, this study suggests some recommendations to enhance effective method of
employee performance of lecturers and staffs. UNISEL must give them more awareness of
another method of performance appraisal because another method is useful for them to enhance
their skills too. Another two methods which are peer and 360-degree feedback give an important
impact for them.
5.4 Recommendations
According to this study, the researcher would strongly recommends that employee’s at
UNISEL should improve their performance appraisal to be more effective among employees in
this organization. This is because there are still some employees who do not aware to use all the
methods or performance appraisal practices in UNISEL due to several factors. From that,
researcher recommends that all employees in UNISEL must improve their performance
appraisal.
Some of the recommendations are as follows:
i. Make sure managers and subordinates understand the appraisal system
The appraisal system should be explicitly described specific to the purpose of the
appraisal. Organizations that clearly state the purpose for the appraisal reduce the
confusion and ambiguity of the process. The goal should be that everyone knows why
you are conducting appraisals.
70
ii. Start with effective performance planning
Planning is required to set the stage for effective appraisals. The majority of subordinates
cited unclear performance standards as a cause of ineffective appraisals. Meaningful and
accurate evaluation and feedback requires clear goals be established beforehand.
Therefore, a large part of the process should be devoted to determine what actions need
to be taken in the future. It is harder to correct the results of poor planning than it is to
plan correct at the beginning.
iii. Training
One significant pitfall is when companies send out 360-degree evaluations to raters
without advance notice or information about how to use the instrument. When an
organization decides to implement a 360-degree review process, two sets of employees
and managers must be trained on how to effectively use the process; those receiving
feedback and those offering feedback. Training should also include objectives of the
process and the impact on the organization.
71
5.5 Summary
This is a descriptive study of method of performance appraisal is effective as a motivator to
increase the employee performance among lecturers and staffs at UNISEL Shah Alam. Further
studies on this area are recommended in order to have depth explanation on performance
appraisal. Depth explanation will encourage reader to have full view about which method are
effective as a motivator among lecturers and staffs in many aspect such as level of awareness on
performance appraisal, the relationship between performance appraisal and employee
performance and also factor that influence performance appraisal.
72
APPENDIX
I
Sources: Adapted from http://ruthlessresearch.wordpress.com/2011/10/19/ruthmap-of-research/
Figure 11: Research Diagram

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A STUDY ON WHICH METHODS OF PERFORMANCE

APPRAISAL IS EFFECTIVE AS A MOTIVATOR TO

MOHAMAD FAZLY BIN ZAINAL

MOHAMAD FAZLY BIN ZAINAL

THIS PROJECT PAPER IS SUBMITED TO FULFILL THE PARTIAL REQUIREMENTS

This project paper entitled “A STUDY ON WHICH METHOD OF PERFORMANCE

APPRAISAL IS EFFECTIVE AS A MOTIVATOR TO INCREASE THE EMPLOYEE

PERFORMANCE AMONG LECTURES AND STAFFS AT UNISEL SHAH ALAM” was

prepared and submitted by MOHAMAD FAZLY BIN ZAINAL and NURAFIQAH BT

MADON as a partial fulfilment of the requirement for BACHELOR OF HUMAN

RESOURCE MANAGEMENT (HONS) in hereby read and approved by:

Madam Noor Nasyikin Md. Zain Date

Name : Mohamad Fazly Bin Zainal

Matrix number : 41020051461

Name : Nurafiqah Binti Madon

Matrix number : 4102005121

Mohamad Fazly Bin Zainal

Nurafiqah Binti Madon

respondents and thankful for all their help.

Thank for all commitment in this project paper.

Table 1: Gender of Respondents 44

Table 2: Age of Respondents 45

Table 3: Marital status of Respondents 46

Table 4: Years of services for Respondents 47

Table 5: Reliability Statistics for Section B 48

Table 6: Awareness of Employee on Performance Appraisal 49

Table 7: Relationship between Performance Appraisal and Employee 51

Table 8: Supervisor Appraisal Method 53

Table 9: Peer Appraisal Method 55

Table 10: Self-Appraisal Method 57

Table 11: 360-Degree Feedback Method 59

Table 12: Descriptive Statistic Result 61

Table 13: Pearson Correlation Matrix Results 62

Figures 1: Theoretical Framework 34

Figure 2: Gender of Respondents 44

Figure 3: Age of Respondents 45

Figure 4: Marital Status of Respondents 46

Figure 5: Years of Services for Respondents 47

Figure 6: Awareness of employee on performance appraisal 50

Figure 7: Relationship between performance appraisal and employees 52

Figure 8: Supervisor Appraisal Method 54

Figure 9: Peer Appraisal Method 56

Figure 10: Self-Appraisal Method 58

Figure 11: 360-Degree Feedback Method 60

Figure 12: Research Diagram Appendix I

Declaration and Copyright Page іі

List of Table vіі

List of Figures vііі

CHAPTER 2: LITERATURE REVIEW

CHAPTER 3: RESEARCH METHODOLOGY

CHAPTER 4: DATA ANALYSIS AND FINDINGS

context, performance appraisal is a systematic evaluation of personnel by supervisors or others

A more comprehensive definition is performance appraisal is the formal, structured system of

or delivered by a supervisor to a subordinate, designed to help employees understand their roles,

objectives, expectations and performance success

performance appraisal is to judge the relative worth or ability of an individual employee in

Performance can be defined as the achievement of specified task measured against

predetermined or identified standards of accuracy, completeness, cost and speed. In an employment

contract, performance is deemed to be the accomplishment of a commitment in such a manner that

increasing an individual’s performance.

completing task (Gilbert, 1978)

method of performance appraisal is effective as a motivator to increase the employee performance

among lectures and staffs at UNISEL Shah Alam.