THE EFFECT OF INTERNAL ENVIRONMENT ON EMPLOYEE PERFORMANCE

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THE EFFECT OF INTERNAL ENVIRONMENT ON EMPLOYEE PERFORMANCE: A CASE STUDY OF VITAL PRODUCTS LIMITED

ABSTRACT

This work was intended to explore the effects of internal environment on job performance and the make-up of what constitutes an internal environment in the company under study and examines the relationship between the workplace physical conditions and employee’s productivity. The workplace environment plays a crucial role for the employees. Nowadays employees may have a large number working alternatives, then the environment in workplace becomes a critical factor for accepting and/or keeping the jobs. The quality of environment in workplace may simply determine the level of employee’s motivation, subsequent performance and productivity. How well employees get along with the organization influence the employee’s error rate, level of innovation and collaboration with other employees, absenteeism and ultimately time period to stay in the job. With a chi square calculated value of 49.5 the researcher concluded that Provision of modern office equipment impact on workers performance, thus she recommends analysis could be extended by investigating the gender differences towards the effects of workplace environment and productivity survey.

CHAPTER ONE
INTRODUCTION
1.1 BACKGROUND OF THE STUDY
An organization is a complex entity made up of different systems and subsystems and these multiple systems need to be governed and led. Modern management is a process of creating, multiplying, distributing, preserving and perpetuating wealth and these can be also regarded as the five missions of management (Heady 1991).
People design results, accomplish results and deliver results and smart managers need to wire their result accomplishment model around people. There is need to make people knowledgeable, empowered, motivated and primed to achieve organizational objectives. Managers must explore their people to volunteer their hidden skills, emotions, talents, ambitions, and enthusiasm. Any manager who cannot get along well with his people can never achieve great results. A lonely manager can never accomplish great results.
Internal environment refers to one’s immediate surroundings. That phenomenon that makes up man’s existence including water, air, land in which one lives that influences one’s life.
In this research work, the researcher will peruse internal environment as it relates to factors that affect workers productivity and performance inherent within the organizational confines, such as management style, organizational environment, staff relationship, motivational factors-salary increase and opportunity to develop oneself. It has been established that an improved internal environment affords the organization better chances of increased performance, efficiency and productivity.
For desired results to come, line supervision is critical and managers must be available to task people and task stations. Managers need to lend that helping hand of success and result achievement. The ‘blame game’, the ‘shouting game’, and ‘I fire you’ games can never get desired results. They only intimidate task people.
The organizations’ personnel make critical difference between success and failure. The effectiveness with which organizations manage, develop, motivate and engage the willing contribution of the employees will enable them to capitalize on their expertise most efficiently. There is a link between people management and business performance.
An organization that provides its employees with better work and most conducive working environment will expect them to perform exceptionally well, and as well capitalize on their enhanced productivity in the shape of cost reduction, which will ultimately contribute to maximum return on investment. Patterson et’al (1997), suggest that the relationship between employee attitudes and company performance, is highly correlated. They suggested that managers of organizations who are eager to promote productivity and profitability should pay close attention to the attitudes of their employees in order to make them more positive.
In recent times there has been an increased consciousness of the fact that to be happy and cheerful in one’s work place, some conditions must be present even with little pay.
An employer expects nothing less from an employee than to leave up to expectation of contributing maximum input to organizational productivity. The employer amidst her expectation is saddled with the responsibility of providing a conducive environment that engenders that level of productivity she demands from the employee. The internal environment also exerts considerable pressure on human resource management. The internal environment comprises those factors that affect an organization’s human resources from inside the organization’s boundaries.
From the forgoing the researcher is geared towards unravelling the effects of internal environment on employee performance using Vital Products Limited as a case study.

1.2 STATEMENT OF THE PROBLEMS
Every human being as an individual has some unique characteristics, which are distinct from those of others. Therefore, in an organization that employs 100 workers, it tells that there would be 100 different kinds of characteristic of behavior and attitudes.
Good working environment which will take care of the health and well being of the different characterises of individual are expedient in an organization. This could be achieved through motivation which is a psychological concept that demand a thorough understanding of employees needs that will enable the management to blend them with the co-operate needs in order to have an equitable mix that will enhance the realization of both objectives of the organization and employees.
On a closer look, in most organizations, these essential factors have not been properly addressed by contemporary organizations. Little wonder the high frequent rate of industrial disharmony and strike actions being witnessed by these organizations over the years. The consequences of which have regrettably resulted to avoidable strike actions which have affected so negatively not only the organization but the general public.
In addition, this has also resulted in high rate of workers absenteeism and voluntary labour turnover. This is most noticeable in government owned organization.
The problem thus revolves on maintaining equitable compensation package capable of taking care of employees well-being in such a way that equilibrium of social interaction will be maintained with the employers. It is therefore important for the organizations to realize that good internal environment of workers through provision of motivational factors that satisfy their aspiration would have a long-term effect on the profitability base of the organization as well as the fundamental criteria for the measurement of organizational effectiveness.

1.3 OBJECTIVES OF THE STUDY
The main objectives of the study include the following:
• To identify the key internal environmental factors that impact on workers performance
• To assess the impact of control measures on absenteeism.
• To examine the effectiveness of method used by management to motivate workers.
• To evaluate the impact of office working conditions on job turnover.

1.4 RESEARCH QUESTIONS
To achieve the above objectives of the study, the following research questions are posed by the study:
• How can employers increase workers performance through the internal environment?
• In what ways does payment based on number of days worked reduce absenteeism?
• How effective is the motivational tools used by management to motivate workers?
• Does provision of adequate office equipment/material reduce job turnover?

1.5 RESEARCH HYPOTHESES
For the purpose of this study, the following research hypotheses will be formulated:
• Ho: Supervisors and subordinate relationship within the organization does not motivate workers.
Hi: Supervisors and subordinate relationship within the organization motivate workers.
• Ho: There is no relationship between control techniques and absenteeism.
Hi: The method used to supervise and control workers drastically impact on the rate of absenteeism.
• Ho: Increase in salary does not always motivate workers to increase performance.
Hi: Increase in salary motivate workers to increase performance.
• Ho: There is no relationship between provision of modern equipment and job turnover
Hi: There is a relationship between provision of modern equipment and job turnover

1.6 SIGNIFICANCE OF THE STUDY
This study as stated earlier will highlight the effect of internal environment on employee performance and the factors that entails a good internal environment in the organization used as a case study. The top management and every other managerial level in the organization will find the study very fundamental when it comes to issues of employee motivation and workplace environment. It will also form bedrock for further research in this field of human resource management.

1.7 SCOPE OF THE STUDY
The study will cover specifically the company under observation and how the internal environment affects her operations in relation to level of productivity, employee job satisfaction, performance indices etc. The study will cover both entire management cadre of the organization under study.

1.8 LIMITATION OF THE STUDY
This study is limited to the company under study and her branch office in Enugu. Due to limited factors like time, fund and mobility, the researcher could not cover more manufacturing firms.

• DEFINITION OF TERMS
PRODUCTIVITY:
Is the output of an individual compared to input. Productivity is a measure of the efficiency of production. Productivity is a ratio of production output to what is required to produce it (inputs). The measure of productivity is defined as a total output per one unit of a total input.(Wikipedia)

EMPLOYEE:
A person who is hired to provide services to a company on a regular basis in exchange for compensation and who does not provide these services as part of an independent business. (investorwords.com )

PERFORMANCE:
The results of activities of an organization or investment over a given period of time. This is the act of doing a piece of work which one is either ordered to do or promised to do. It could be as the result of an act, which is measured in quality or in quantity.

ENVIRONMENT:
Social, Legal, Economical, Political or Institutional factors that are uncontrollable in nature and affects the functioning of organization

INTERNAL ENVIRONMENT:
It includes 5 Ms i.e. man, material, money, machinery and management, usually within the control of business. Business can make changes in these factors according to the change in the functioning of enterprise.

MOTIVATION:
Motivation is the psychological feature that arouses an organism to action toward a desired goal and elicits, controls, and sustains certain goal directed behaviors. For instance: An individual has not eaten, he or she feels hungry, and as a response he or she eats and diminishes feelings of hunger. There are many approaches to motivation: physiological, behavioural, cognitive, and social.

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Clements C., and Kaluarachchi, Y. (2000) An
Assessment of the Influence of the In-door Environment on the Productivity of Occupants in Offices Design, Construction and Operation of Healthy Buildings, pp.6781.

Haynes. B. P. (2008). An Evaluation of the Impact of the
Office Environment on Productivity. Journal of Facilities, 26 (5/6), pp. 178-19.