CHAPTER 1INTRODUCTION1.1 Background of the study

Since 1992, Corporate Performance in business organizations has been strongly influenced by the rise of the balanced scorecard framework. It is common for managers to use the balanced scorecard framework to clarify the goals of an organization, to identify how to track them, and to structure the mechanisms by which interventions will be triggered. These steps are the same as those that are found in BPM, and as a result balanced scorecard is often used as the basis for business performance management activity with organizations.Corporate Performance (CP), is an increasingly important concept used to ensure the private sector has a positive impact on communities, employees and consumers. This is especially so in geographies where basic governance, the rule of law and accountability mechanisms are lacking or limited, Hilmer (1994). Corporate Performance Management (CPM), also commonly referred to as enterprise performance management (EPM) or business performance management (BPM), is a business methodology that promotes the ongoing tracking and measurement of the performance of an entire organization as a whole (as opposed to a specific department or business unit, or even an individual employee), (Hoover, 2006). Critical metrics and key performance indicators (KPIs), such as revenues, profits, cash flow, customer retention, or employee turnover, are often measured as part of a corporate performance management strategy. Indigenous Petroleum oil Companies seeking to implement a corporate performance management program have many techniques to choose from.Corporate performance management strategies have been proven to deliver substantial advantages (Lawler, & Mohrman, 2009).. CPM enhances communication, collaboration, and alignment among all levels of an organization, bringing together staff members at the executive, management, and operational levels in support of common goals. Corporate performance management also boosts productivity, reduces overhead expenses, increases flexibility and responsiveness to dynamic market conditions, enhances risk management, and facilitates improved adherence to regulatory guidelines. But not all corporate performance management strategies are successful. Surprisingly, many CPM initiatives fail to deliver the desired results. This is primarily because strategies and priorities are not properly communicated beyond the executive level, which leads to poor organizational alignment. Additionally, there is often a lack of accountability, as stakeholders simply don’t understand how they will be expected to help reach certain goals.Outsourcing in corporate organizations, like selected petroleum oil firms in port Harcourt is a choice that lies in the corporate policy, not just business strategy, area, as it modifies the firm’s boundaries as a legal entity and generally involves top management decision makers. Affecting company-wide resource allocation policies and asset management practices, outsourcing decisions often involve several divisions in large, diversified companies, as in the case of organizational personnel outsourcing operations.Moreover, information communication technology usage and faster information flows have revolutionized our way of life and the way corporate organizations operate. This change in focus requires the personnel function to become more strategic (Francis & Keegan, 2006). Many researchers stated that outsourcing the personnel activity is one of many strategies used by business executives to meet the organization’s demands and objectives; including cost reduction, increasing flexibility, gaining access to advanced technologies, and a focus on core activities (Khanna & New, 2005). Personnel outsourcing is the process of transferring elements of a company’s personnel functions or activities to a provider outside of the company itself (Reed, 2001).Personnel outsourcing is not new, for example, organizations typically engage law firms for advice regarding personnel legislation. However, if most firms in the same industry were to choose the same type of solution, such as outsourcing, the strategic advantage would no longer be valid, as companies would all converge to the same business model (Porter, 1996). To be considered as a strategic choice, outsourcing must be a distinctive feature of specific firms in an organization. This coupled with the uncertainty and stress associated with the restructuring of work can lead to a lowering of organizational performance, (Hirsch, 1987).In this light, the prior personnel activities being commonly outsourced include recruitment and selection, remuneration, industrial relations (IR), and occupational health and safety (OHS) (Armstrong, 2006). Therefore , the study investigates the relationship between personnel outsourcing and corporate performance.

1.2 Statement Of The Problem.

The challenge of personnel outsourcing has been on the increase over the years to most managers and employees in our corporate organizations, thus the quest for intense personnel outsource in modern corporate organizations so as to demystify the functions of management and the employees performance in the organization. Most significantly is the effort of the organization to fetch a capable hand in the execution of business activities in the organization; hence, with this problem in place, all corporate firms see this practice to be very vital in improving the performance of the organization. Some authors observed that outsourcing is no longer confined to information technology (IT) services, but has expanded to financial services, banking services, engineering services, creative services, data management services, hospitality and clinical laboratories or laboratory medicine, and human resource management (Bielki, 2007). Outsourcing the personnel function is one of many ways to improve an organization’s efficiency (Lawler, & Mohrman, 2003). The notion of the personnel function has changed due to the evolution of the internal and external organizational environment (Brewster & Harris, 1999). The focus is no longer on traditional operational and administrative perspectives, but has shifted to changes in employment relationship and strategic personnel management (Beardwell & Claydon, 2007).

1.3 Objectives Of The Study.

1. To examine the relationship between external recruitment/selection and corporate performance in selected indigenous petroleum industries in port Harcourt.2. To examine the relationship between external training and development and corporate performance of the selected indigenous oil firms in port Harcourt.3. To examine the relationship between external performance appraisal and corporate performances.

1.4 Research Questions.

The following research questions were used as a guide to the research guide, these includes;1) To what extent is external recruitment/selection related to corporate performance in the selected indigenous petroleum firms in port Harcourt city?

2) To what extent is external training and development related to corporate performance of the selected indigenous petroleum firms in port Harcourt city?3) To what extent is external performance appraisal related to corporate performances of the selected indigenous petroleum firms in port Harcourt?

1.5 Significance of the study.

A research study is said to encompass the views and issues bordering corporate organizations and the society at large. In this regard, the research study in question is seen to be of great benefit to decision makers ,human resource managers and the top management of corporate firms in the society. It would also serve as veritable tool to most companies and institutions in outsourcing personnel’s for carrying out core –activities of an organization, and also to incite more zeal details of the concept in course of carrying out further research work on this study.1.6 Research Hypothesis.The study was guided by the following null hypotheses:H01: There is no significant relationship between corporate performance and personnel outsourcing.Ho2: There is no significant relationship between external and developmental corporate performance of the selected indigenous oil firms in the stateH03: There is no significant relationship between external performance appraisal and corporate performances.

1.7 Scope and Delimitations Of The Study

The scope of this study is delimitated with the following;(a)Content scope:The research work is confined to determining the relationship that exist between personnel outsourcing and corporate performance with their dimensions and measures respectively. The dimensions of personnel outsourcing are external recruitment /selection, external training and development and external performance appraisal. The measures of corporate performance are; market shares , productivity, and effectiveness.(b)Geographical scope:The research study (personnel outsourcing and corporate performance) is been conducted in the area of Trans Amadi area of greater port Harcourt city Rivers state.

(c) Unit of Analysis:The research study is a micro-level study, therefore, the employees of indigenous petroleum firms are considered in terms of data collection for proper analysis.

1.8 Definition of terms.

CORE ACTIVITIES. This refers to business functions and activities that are close and related to the firms performance and roles.

CORPORATE : Is a collective performance of duties in an organization by the employees based on the organizational set goals as to measure profitability efficiency and productiveness of the employees, management and organization as an entity .

DEVELOPMENT : To bring out the capabilities or possibilities of, to bring to a more advanced or effective state.

EXTERNAL TRAINING : External Training in this context is therefore not an inclusive list of courses of academic study in support of traditional higher and further academic qualifications undertaken by management of an organization by sourcing for other employees.

EXTERNAL RECRUITMENT : External recruitment is when the business looks to fill the vacancy from any suitable applicant outside the business

MARKET SHARE : Market share represents the percentage of an industry or market’s total sales that is earned by a particular company over a specified time period. Market share is calculated by taking the company’s sales over the period and dividing it by the total sales of the industry over the same period.NON- CORE ACTINVITIES: These are those service aspects that are not necessarily required by the firm in fulfilling its value proposition to its customers , such as installation, maintenance, of a system which can be outsourced.

ORGANIZATIONAL PERFORMANCE: This is the general role and functions demonstrated by corporate organizations in planning, organizing, controlling the company resources and giving directives to her employees on how duties should be carried out.PRODUCTIVITY : This is commonly defined as a ratio of a volume measure of output to a volume measure of input use.PERSONNEL OUTSOURCING: Personnel outsourcing, is the contracting out or parts of the whole of the functions of personnel’s to external providers, rather than performing all the personnel functions in-house.