Survey Of The Efficient And Effective Personnel Management In Small And Medium Scale Industries

INTRODUCTION
1.1 BACKGROUND OF THE STUDY
The rate of increase in population in the world is fast growing especially in developing
countries like Nigeria, that societal demands for essential goods and services are so
much on the increase that government owned companies and industries cannot meet
up with these demands. The government being aware of these pertinent problems
created a healthy environment in which some multi-nationals, the societal demands
for services and goods have been satisfied, but not completely.
Further, since human beings are insatiable and the satisfaction of a problem leads to
another, the society at large demanded for some other smaller commodities in which
the government owned and multi-national companies couldn’t meet up with the
demands because of either disturbance in their production schedules or the small
quantities demanded. The government therefore gave legal authority by way of edicts
to interested individuals to establish their own small-scale companies of their choice.
Not only that they were given legal authority, they were given loans by government to
set up financial institutions to monitor and supervise the operations of these small
scale industries.
Agason Nigeria limited an example of such a small scale company established under
such edicts: it is purely a one man business which was established in 1990, but it
started production in 1994. It is a soap manufacturing company located in Owerri
industrial layout in Imo state and has a staff capacity of thirty, made up of three
supervisors graduates, and the rest of the staff are semi-skilled and unskilled workers.
Her products are Anchor quality bar soap, ladder bar soap, Anchor and ladder tablets.
The organizational structure is such that the owner does all the managerial functions
and every worker is expected to report to him before any actions are taken. But the
company has not really received the financial assistant from banks because of lack of
personnel and poor managerial capability of the owner. But it should be noted that
whatever may be the organizational goals or activities of any company, it can only be
achieved and implemented through effort and capabilities of people. Otherwise the
organizational structure must be manned and staff properly. Therefore it can clearly
be put that the appropriate management of human resources is an essential
responsibilities in all business regardless of size, in fact, the smaller the business, the
less important it is to select the right persons for the right job.
The question now become who then selects the right person and how did it start in
small scale organizations. Small scale organization has been with man, since the
creation of man. Man has produced controlled and sold his commodities before now,
and it is on history that every organization started as a small scale. During the early
stages, man was regarded as an adjunct to machine which will be used fullest and
discarded when not productive. This theory is regarded as “factor of production
approach” or “commodity approach” and was founded by Taylor and his associates. It
is the scientific management principle, and they argued that if wages are tied to the
units produced, a worker will produce more units to get more money.
This approach gave rise to paternalistic management; which means management
should show a fatherly protection towards the employees. It was predominant during
the 1920s and replaced the commodity approach. The paternalistic benefits ranged
from loans and appointment of welfare officers whose duty was to improve the
welfare of employees.
During the 19th century, some group of persons tried to intervene in industrial affairs
to support the position of underprivileged factory workers at the mercy of greedy
employees. This process was known as social reformer and was greatly propounded by
Lord Shaftesbury and Robert Owen they stood outside the organization and work
place to criticize the behavior of employers and induce some changes. Personnel
manager were appointed and provided with the frame of reference for the appointees
to work within. It is important to that these companies under study were small scale
companies. The social reformer gave birth to the “Benevolence” which was the next
stage of personnel management and was developed by Quaker Families of Cadbury
and Rowntree and the Lever brothers it appointed welfare officers who were given
specific responsibilities for improving the lot of employees. They provided goodies for
the employees because they partly desired them and they included childcare and
health screening the benevolence lead to the “human official” or “Benevolent
Approach “. At this stage, employing organization were taken a further step in
increasing their size, specialization was emerging in the management levels and it led
to the growth of personnel work , which is known as “staffing “. The human relations
school of thought influenced the human bureaucracy stage in the development of
personnel thinking, which was in many ways a reaction against scientific management.
The human relation approach appealed immediately to those who were concerned
about industrial conflict and the bad results from scientific management. The main
advocate was Elton mayo (1993). The central idea was to emphasize informal social
relationships and employee morale as contributions to organizational efficiency. It let
to the concern, collective opinion or negotiation stage where appointed as their
accredited representatives. Employee shifted towards bargaining with the
representatives on at least some matters. The personnel manager actively participated
in the bargaining since he had acquired bargaining expertise.
The human relations view gave a number of benefits to employees; they were
paternalistic determined by management with more input from employees.
Management felt the need to maintain good relations with employees because it
believed this would lead to high performance. It thus, provided benefits not because
employees demanded or needed such benefits but because it wanted to buy over the
employees as a strategy for achieving its own objectives. It was popularized by the
Hawthorn studies, which demonstrated the effect of framework and co-operation on
performance.
The last stage is the manpower analyst, associated with the terms “management of
human resources”. There is also the use of manpower planning in which organizations
utilize and improve human resources. It assesses what manpower will be needed,
decides what manpower in an organization is likely to have in the future, and take
actions to ensure that supply meets demands.
This last stage is where the problems of personnel management lie in small scale
organizations; this research will look deeply into the functions and problems of
personnel management and ways of improving and combating them.

FIG 1: ORGANISATIONAL STRUCTURE OF AGASON NIGERIA LIMITED
Manager /chief Executive
Officer
Production/workers
Maintenance
Production Supervisor Marketing Supervisor
Marketing, Staff and Driver
Procurement
Supervisor

1.2 STATEMENT OF THE PROBLEM
Personnel management in small medium scale industries has been faced
with multi-dimensional problems. Personnel is one of our most complex
and challenging fields or endeavors, this is because it is this function that
integrates the interest of the organization-that of the employee and the
society at large. The success of an organization depends largely on the
activity of her personnel. And in the light of the foregoing, these questions
were found relevant to guild the present research effort:
I. What are the sources of recruitment in Agason Nigeria Limited?
II. What are the sources of human resources development in Agason
Nigeria Limited?
III. What are the basics for wages and salary administration in small scale
organizations?
IV. What are the motivational factors in Agason Nigeria Limited?
V. Is the owner aware of internal and external assessments within and
outside the organization?
VI. Does lack of fund impede the implementation of personnel functions
in Agason Nigeria limited?
VII. What are personnel functions in small-scale organizations like Agason
Nigeria limited?
VIII. What are future prospects of personnel management in small scale
organizations like Agason Nigeria limited?

1.3 OBJECTIVE OF THE STUDY
The search for solutions to the problems and prospects of personnel
management in small scale organizations has almost proved abortive. These
problems are multifarious and the purpose of this research is to reduce
these problems to the minimum and make small scale industries achieve or
attain the purpose of which they were set up. Therefore the specific
objectives of this research could be narrowed down as follows:
1) To determine whether or not human resources development affects
the organizational efficiency of Agason Nigeria Limited.
2) To find out if motivation of workers helps in achieving the goals of
Agason Nigeria Limited.
3) To determine if wrong selection and recruitment of workers has a
negative effect on Agason Nigeria limited.

1.4 HYPOTHESES
The following hypotheses have been derived from the statement of
problem and objectives of study as enumerated above.
1) H₁ human resources development affects the organizational efficiency
of Agason Nigeria limited.
2) Hâ‚‚ motivation of workers helps in achieving the goal of Agason Nigeria
limited.
3) H₃ wrong selection and recruitment of workers has a negative effect
on Agason Nigeria limited

1.5 SIGNIFICANCE OF THE STUDY
The importance on the roles small and medium scale industries play in any
country cannot be overstressed; these industries have therefore to be
manned and staffed rightly in order to achieve these sole aims. This
research could serve as a guideline for other researchers. Further, it is of
academic interest of knowing, if the staffing and selection policies and
productivity have a positive or negative correlation, and it will help in
evaluating, if the objectives have been achieved. Organizational managers
and policy formulator will gain a lot, if they are aware of these factors that
spur or inhabit their employees to or from performance.
Finally, it is the hope of the researcher that small and medium scale
organizations that do not have personnel managers should do so, because
the owner of these companies cannot be perfect in all areas.

1.6 SCOPE OF THE STUDY
This research focuses on the personnel problems of Agason Nigeria limited
from 1994 to date. Since is a company based in Owerri, the researcher may
be constrained to use certain information internally. Of the three
supervisors and twenty staff were administered with questionnaire, also
thirty other workers from three other small scale organizations around the
industrial area were given questionnaires who have stayed up to five years
in each of these companies, which were used in this study.

1.7 OPERATIONAL DEFINITION OF TERMS
Under the operational definition of terms, the terms are to be defined
operationally, that is, how they affect the study. The terms are listed below.
2. SMALL AND MEDIUM SCALE INDUSTRIES: The definition of small and
medium scale industries vary within a country. In Thailand different
agencies use different criteria to classify small and medium enterprises.
A. The ministry of industry uses employment and equity figures to define
them as legally registered factories.
Small Scale enterprise Medium scale
enterprise
Employment Criteria >50 employees 50-200 employees
Equity Criteria >10 million baht 10-100million baht
Meanwhile, the bank of Thailand, the small industry finance co-operation
(SIFC) and the industrial finance co-operation of Thailand (IFCT) adopted
another definition based on net fixed assets.
Small –scale Medium -scale
Net Fixed asset >20 million baht None
In Nigeria, it has various definitions according to different set up. Firstly, the
small business enterprise are those whose total investment is limited to
amount not in the large scale category and therefore do not have
economics of scale on their own right.
I. Low set up capital
II. Short gestation period
III. Small labour force
IV. Use of simple technology
B. The small business Act of 1953, defined small business as firms as one
which is independently owned, operated and not dominant is its field
of operation. The act says that business is one, which is owned,
managed controlled by one or two persons and has no defined
organizational structure, has a relatively small share of the market and
employees less than 50 people.
C. The National council on industry in 1996 defines small enterprises as
those in which the capital (working capital inclusive) falls within N
1million to N10million Naira with a marketed labour of between
11people. While medium enterprise is above N10 million Naira but
not Exceeding N150 million and with labour force of between 35 and
100 people.
D. The central bank of Nigeria credit policy and loans as one whose total
cost excluding cost of land but including working capital is above N1
million but does not exceed N10 million.
E. The small scale industries division of federal ministries of industries
defines it as an enterprise having investment capital (including land,
building, machinery, and equipment and working capital of up to
N150,000 and employing not more than 50 people).
F. The Nigeria bank for commerce and industry (NBCI) for the purpose of
its revolving loan scheme to small scale industries defined small–scale
enterprise as those investigating more than N750,000 including
working capital but exceeding the cost of land.

1.7 RECRUITMENT
Recruitment and selection are so are so interchangeably used in the
employment process. But Guion’s (1965) comment on recruitment portrays
an all embracing view. Recruitment also includes the simple device of
keeping the door to the employment office open so that application may
walk in off the street. Fleishmann (1967) appear to be more forthright,
when he emphasizes that organization reach out for candidates through
“visit by company executives to college campuses”.
Ungreson (1970) says recruitment is a process, the capacities and
inclination of the candidate has to be matched against the demands and
requirements of the given job or career pattern.
There are two sources of recruitment; internal and external sources.
a) INTERNAL SOURCES: Here, the organization prepares a
comprehensive program of talents inventory and analysis to enable
the personnel department to establish the correct standing of
employees and stability for promotions and transfers. It is done within
the organization.
b) EXTERNAL SOURCES: Organization goes outside to recruit for position
whose conditions and specification cannot be met by existing
personnel, for expansion and for lower –entry jobs. The external
sources include words of mouth, advertisement, government
employing agencies, schools and colleges just to mention a few.

1.7 SELECTION
According to Blum & Naylor (1968) selection, “involves picking for hire a
subset of workers from the total set (population) of workers available for
hire at any given moment of time”.
Anastasia (1965) defines personnel selection problem “as choosing from a
number of available applicants, a smaller number of available applicants, a
smaller number to be hired for hired for a given job”.
1.7 HUMAN RESOURCE DEVELOPMENT
It is known also known as employee training. Training is a learning process
that involves the acquisition of skills by employees to enable them
increases their performance. It is one of the most vital aspects of personnel
management, because the success and failure of any organization is
depends on the caliber of the human element.
There are many forms of human resources development; these include
orientation and induction, refresher course, management seminars,
conferences and workshops and the job-training.