The Ripple Effects of Performance Management on Employees’Perceptions and Affective Commitment among Small and Medium Scale Enterprises (SMEs)

Abstract

Management literature acknowledges the important role played by performance management systems (PMS) in business organization, however, a little empirical studies exist in the Ghanaian context.Using a sample data of 180 from managements and staffs of thirty-eight (38) Small and Medium Scale Enterprises (SMEs), the current study presents the effects of performance management systems on employees perception and organizational commitment (affective) among Small and Medium Scale Enterprises (SMEs) located in the Greater Accra region of Ghana.Statistical Package for Social Sciences 20.0 version (SPSS) and Microsoft Word 2010 were employed for the data analysis. From the result, performance management had a positive significant relationship with employees’ perceptions and affective organizational commitment.The study further examined the mediating role of both employees’ perceptions and affective commitment on performance management towards operational performance, it was revealed that both variables positively mediate the relationship between performance management and organizational performance of the SMEs in Ghana. This indicates that SMEs in Ghana have seen the need for implementing proper performance management systems based on their own capabilities to ensure effectiveness in meeting the organizational objectives.