EFFECTIVENESS OF EMPLOYEES PERFORMANCE APPRAISAL AT COMMERCIAL BANK OF ETHIOPIA NORTH ADDIS DISTRICT

Abstract

The main purpose of the study was to explore the effectiveness of performance appraisal at Commercial Bank of Ethiopia, Addis Ababa city-branches. In order to achieve the objective of the study, descriptive survey method was employed. Questionnaire was an instrument for the primary data collection. Accordingly, 80 respondents from 323 employees working in four branches of CBE were selected using sample size determining table. The data gathered through questionnaire were analyzed using both quantitative instruments: mean & standard deviation, and qualitative instruments: percentage, frequency & correlation with the help of Statistical Package for Social Science (SPSS) version 20.. The descriptive study revealed that appraisal job objectives are mismatching with organization standards, lower acceptance and minimized knowledge of appraisal measurement techniques, missing relevant aspects of performance in the appraisal, rater’s bias, inconsistent measure of performance, lack of ongoing performance measure and decrease employee commitment, motivation and job satisfaction. The inferential study also revealed that there is a strong positive relationship between performance appraisal indicators with performance appraisal effectiveness. Hence, it is reasonable to conclude that the appraisal process was not clearly communicated before implementation resulting unacceptable appraisal of performance by employees; lack of covering all necessary aspects of performance while measurement and failing to conduct timely and continuous appraisal process highly affected the overall effectiveness of the performance appraisal of Commercial Bank of Ethiopia at large and personal development in particular. It is recommended that since fitting of appraisal with organization strategy, acceptability, validity and reliability are the most significant factors of all the performance appraisal indicators resulting in effective performance appraisal system, the management should conduct detailed study and assess critically on performance fitness, acceptability, validity, and reliability for it is a starting point in the design of effective performance appraisal.