CHAPTER ONE

INTRODUCTION
1.1 BACKGROUND TO THE STUDY
Attainment of a high level performance through productivity and efficiency has
always been an organizational goal of high priority. In order to do that highly
satisfied work force is an absolutely necessity for achieving a high level of
performance advancement of an organization. Satisfied worker leads to extend more
effort to job performance, then works harder and better. Thus every organization
tries to create a satisfied work force to operate the well- being of the
organization.
However, the total organizational performance depends on efficient and effective
performance of individual employees of the organization. Therefore, every
organization places a considerable reliance on their individual employee
performance to gain high productivity in the organization.
Employee effort is an important factor that determines an individual performance
will be. When an employee feels a satisfaction about the job, he/she is motivated
to put greater effort to the performance. Then it tends to increase the overall
performance of the organization. In other words, a satisfied individual employee
and his effort and commitment are crucial for the successfulness of the
organization.
Nigerian Agip Oil Company Limited (NAOC) with headquarters in Lagos Nigeria is a
joint venture operated by Agip and owned by NNPC (60 percent), Agip (20 percent)
and Phillips Petroleum (20 percent) produces 150,000 bpd mostly from small onshore
fields.
Job satisfaction is a complex and multifaceted concept, which can mean different
things to different people. It is more of an attitude, in internal state. It could
be associated with a personal feeling of achievement, either quantitative or
qualitative (Mullins, 1999). He examines job satisfaction (1) in terms of the fit
between what the organization requires and what the employee is seeking and (2) in
terms of the fit between what employees is seeking and what he/she is actually
receiving. He emphasized that the level of job satisfaction is affected by a wide
range of variables relating to
(1) Individual (i.e. personality, education, intelligence and abilities, age,
marital status and orientation to work);
(2) Social factors (i.e. relationship with co-workers, group working and norms and
opportunity for interaction);
(3) Cultural factors (i.e. attitudes, beliefs and values);
(4) Organizational factors (i.e. nature and size, formal structure, personnel
policies and procedures, employee relations, nature of the work, supervision and
styles of leadership, management systems and working conditions); and
(5) Environmental factors (i.e. economic, social, technical and governmental
influences).
Sweeny and Mcfarln (2002) defined job satisfaction as the result of a psychological
comparison process of the extent to which various aspects of their job (e.g. pay,
autonomy, work load) measure up to what they desire. Thus, the larger the gap
between what employees have and what they want from their jobs, the less satisfied
they are; (employees tend to be most satisfied with their jobs when what they have
matches what they want.
An employee‘ overall job satisfaction is the cumulative result of comparisons that
she makes between what her job provides and what she desires in various areas. The
fact that perceived importance makes such a big difference in how employees feel
also has implications for management. Obisi, (2003), listed factors that contribute
to job satisfaction as; adequate salary, good working conditions, parental
management, job security, opportunity for growth, positive and supportive
environment, friendly nature of co-workers and colleagues responsibility and
cordial relationship between the superior and the subordinates. Therefore, we can
conclude that job satisfaction is a person‘s evaluation of his or her job and work
context.
This research is beaming searchlight into the influence of job satisfaction on
employee’s performance in Agip Oil Company in Nigeria.
1.2 STATEMENT OF THE PROBLEM
The evolving competition in the oil and gas industry today in Nigeria is evident
from the increasing foreign investors and many multinational companies and local
investors (independent marketers) has called for good organizational framework that
would allow these companies to retain their best hands.
Gunter and Furnham (1996) state that job satisfaction can directly cause work
outcomes that are positive. Positive work incentives are incentives that make work
interesting, e.g.; attractive work environment, good personnel policies, provision
of benefits, job structure and compensation. Enabling work environment leads to
motivation, good personnel policies, favourable work environment, and provision of
benefits, job satisfaction and compensation. However, negative work incentives
include those incentives that make work boring, unchallenging and dissatisfying.
They lead to increased absenteeism, turnover and accidents. Thus to prevent these
negative work outcomes, there is a need to find out which factors within the
organizational context can lead to satisfaction among employees of Agip Oil Company
so as to continually have productive, satisfied and contented employees. However,
it is important to point out that the researcher is not unaware of the fact that
factors like clear lines of communication, adequate reward system and promotional
opportunities could also encourage or discourage both positive and negative work
outcomes which if not adequately put in place could result in turnover of these
employees. Comparative studies of this nature would afford the researcher the
opportunity to identify variations in job satisfaction of employee and their impact
on employee performance. A number of factors had been identified in literature as
responsible for the extent to which dissatisfaction is associated with employee
performance and compensation. The impact of these factors varied and are quite
associated with beliefs, management of factors and tolerance levels (Delery and
Doty, 2006; Doty, Glick and Huber, 2003). These factors which could enhance or
impede academics work performance include top management emphasis on administrative
style, work load, feedback about performance and support from superiors.
Moreover, job satisfaction is relevant to the physical and mental well being of
employees, i.e. job satisfaction has relevance for human health (Oshagbemi, 1999).
An understanding of the factors involved in job satisfaction is relevant to improve
the well being of a significant number of people. While the pursuit of the
improvement of satisfaction is of humanitarian value, Smith, Kendall and Hulin
(1969) stated that ―trite‖ as it may seem, satisfaction is a legitimate goal in
itself‖. Therefore, apart from its humanitarian utility, it appears to make
economic sense to consider whether and how job satisfaction can be improved. Hence,
the needs to identify variables within the organizational context that can help
improve the job satisfaction of employee working in an organization. Most of the
previous studies have made attempt to explain a worker‘s job satisfaction as a
function of the individual´s personal characteristics and the characteristics of
the job itself.
Other factors that appear to affect effective functioning of organizations include
management and leadership styles, unclear rules and regulations in the personnel
policies, excessive work load, poor communication with supervisor cum unclear lines
of communication, boredom and frustration resulting from lack of support from the
superior, suitable career ladder, unchallenging jobs and inadequate fringe benefits
as expected in the working condition (Marriner- Tomey, 1996). Therefore, this study
hopes to establish the relationships that exist between the different variables of
employee performance and job satisfaction among the workers of Agip Oil Company.
1.3 OBJECTIVES OF THE STUDY
The main objective of this study is to determine the effect of job satisfaction on
employee performance in Agip Oil Company. The specific objectives are therefore
listed below;
1. To find out the relationship that exists between job satisfaction and employee
performance in Agip Oil Company
2. To identify factors that determines job satisfaction of employees and their
consequential effects employee performance.
3. To determine whether there is a difference in the way senior staffs and junior
staffs perceive the job satisfaction.
1.4 RESEARCH QUESTIONS
What is the relationship between job satisfaction and employees’ performance in
Agip Oil Company?
What are the factors that determine job satisfaction of employees and their
consequential effect on employee performance?
Is there a difference in the way senior staff and junior staffs perceives job
satisfaction and employee performance?
1.5 HYPOTHESES
H0: There is no significant relationship between job satisfaction and employee
performance.
HA: There is significant relationship between job satisfaction and employee
performance.
1.6 SIGNIFICANCE OF STUDY
The focus of this study is centered on employee performance of Agip Oil Company due
to job satisfaction. The study is important as it will highlight the factors that
employees view as enhancing job satisfaction leading to improved employee
performance within their organizational context. The management of companies and
organizations will find the research helpful in improving staff morale and bringing
about job satisfaction of their employees. An employee who achieves success in his
or her job and whose needs are met in the work place would be a happy employee that
would strive to maintain excellence. In addition, the study will recommend
adoptable policies and strategies for mitigating organizational correlates of job
dissatisfaction.
1.7 SCOPE AND DELIMITATION OF STUDY
This research focused on employee performance that could arise as a result of job
satisfaction. The research was conducted in Agip Oil Company Lagos State, Nigeria.
Job satisfaction can have an impact on employees‘performance, which in turn could
lead to an increase of productivity among employees. The study concentrated on
finding out the causes of job satisfaction and dissatisfaction among employees
(senior and lower level) and determines whether there is a difference in the way
the senior and the junior workers perceive the job satisfaction and employee
performance
LIMITATIONS OF STUDY
Limitations experienced in the course of this study are basically centered on
problems relating to:
Difficulty in generating reasonable, adequate and reliable information from
respondents- Respondents tend to provide information which they feel the researcher
would be pleased to get, which may not be the right information.
Financial constraint- Insufficient fund tends to impede the efficiency of the
researcher in sourcing for the relevant materials, literature or information and in
the process of data collection (internet, questionnaire and interview).
Time constraint- The researcher will simultaneously engage in this study with other
academic work. This consequently will cut down on the time devoted for the research
work.
Busy schedule of the respondents- The workers of Agip Oil Company who will be the
respondents of the questionnaires may have busy work schedule thereby making them
to provide answers to the questions hurriedly, which can affect their answers
negatively.
1.8 DEFINITION OF TERMS
Employee: An individual who works part-time or full-time under a contract of
employment, whether oral or written, express or implied, and has recognized rights
and duties. Also called worker.
Satisfaction: refer to discharge, extinguishment, or retirement of an obligation to
the acceptance of the obligor, or fulfillment of a claim.
Performance: the acco