CHAPTER ONE

INDRODUCTION

1.1 Background to the Study

Generally, the productive of every organization dependent on the performance of employees of that organization. (Bah and Fang 2015). Essentially, the success of any institution or business organization is influenced by the employee smart and effective performing of tasks towards realizing the corporate goals (Bundy, et al 2016). The studies of employee’s performance are connected with some different variables. Organizations unlike microfinance institutions that have the capacity to comprehend the effect of employees’ performance are better placed to manage their throughput (Saddam & Abu Mansor, 2015)

It is generally not acceptable that by the year 2000, half of the African countries were affected by conflict caused by inequality, economic decline, state collapse and historical relations with the west (DFID, 2001). Militia fighting in Africa has resulted in a marked reduction in food production and serious losses of infrastructure and hence must be tackled because of the human suffering and also because of the impact on global security and the environment. Fonchingong (2011) noted that the absence of a visionary leadership for the people of the North West and South West Regions of Cameroon make their case more complicated to handle. While the law continues to be put forth as solution to the crisis in Cameroon, Edralin (1998) had noted that good labour relation cannot be obtained by legislation.

Subsequently, there is an association between crisis management from the perspective of preparedness, prevention and employee performance. In this study, the researcher discusses the two dimensions to measure the employee’s performance, which include task performance, adaptive performance, as based on the study of Pradhan and Jena (2017). However, this study sheds light on crisis management due to the catastrophe situation in Bamenda which is grossly affecting the performance of employees and the performance of financial institutions in general.  Crisis management is defined as a three-fold process utilized in preventing a conflict from happening or by trying to scale down its impact (Bujak & Topolski, 2015).  Williamset et al. (2017) suggested that crisis management is the action of developing and executing a business strategy, which can be adopted easily under different circumstances. While crisis is linked to the unexpected and collateral damages that come with it, organizations can avoid colossal losses and enhance productivity if they implement the best approach in managing the crisis (Williams et al., 2017). An effective crisis management plan is a premium for the company in terms of monetary gains not simply by averting the crisis and avoiding the loss but rather by an incentive to investors. Moreover, crisis management works as a damage control for organizations. Nonetheless, owing to crisis reproduction, workers are empowered to respond promptly when facing a crisis (Williams et al., 2017). Owing to the unpredictable nature of the world, crisis management skills remain critical especially if organizations have to survive drastic occurrences whether unforeseen or manmade (Boin, Stern & Sundelius, 2016). At that point, employees that are well trained to manage crises would be better placed to make quick and right decisions, while underpinned by proficient communication in managing the crisis (Boin et al., 2016).

Crisis preparedness involves getting into activities that aim at reducing the probability of occurrence of an incidence. According to Bahadori, et al (2015), crisis presentence entails organizational planning tasks, which can involve proper resources to support the already made resources, depending on nature of the crisis. Crisis prevention is a method that puts early warnings and scanning of the identified crisis. This prevention process can entail making audits and scanning through the business environment (Jackson, 2017). This study focuses on a financial institution and will analyses the effects of crisis management specifically planning and communication on the performance of employees in the University of Bamenda.

1.2 Statement of the Problem

The MFIs was gaining grounds and undoubtedly progressing the economic and social development of the English-speaking regions of Cameroon. Micrfinance have been performing their role of financial intermediation in the economy, they constantly and consciously take the risk. They experience the following risk; which includes credit risk, interest rate risk, liquidity risk, foreign exchange risk and operational risk. Managing these risks is essential for their survival and prosperity. Any loss from a single loan or a material breakdown in controls can eliminate the gain on many other transactions. The economy of Bamenda by 2015 was ranked second in to Douala the economic capital of Cameroon in terms of growth in the whole country In 2016, the Anglophone crisis erupted and drastically affected the North West and the South West regions of Cameroon in addition With the advent of this crisis in 2016 banks started to registering an unsatisfactory financial performance as reflected from increasing loss ratios such as current ratios, quick ratio, net profit ratio, and return on capital employed ratio these indicators were brought forth by adverse economic drawbacks like massive displacement of customers, high rate of loan delinquency, insecurity to the employees which has affected their productivity, frequent ghost towns and lock downs which have reduce the number of working days just to name but few. Bamenda more especially has been the center of this crisis. Financial institutions were taken unaware by this humanitarian crisis

The management of microfinance institution is trying to put in place measures to reduce the situation like communication, analyzing the crisis affected areas, creating a crisis management team and a crisis communication team, these measures have however been poorly implemented and instead of redressing the situation it is instead deteriorating as the days go by. The poor implementation of these crisis management strategies has greatly affected the performance of employees who fear to put in their best as they did before the crisis. For instance; employees maintain low standard of work, low moral for work, poor communication, longer period to complete task, resistance to coping to new organizational changes etc.

These ineffectiveness of managing the disruptive crisis motivated the researcher to conduct a study on the effect of crisis management to the performance of employees in microfinance institutions in Bamenda.

1.3 Research Questions

1.3.1 Main Research Question

What are the effects of crisis management on the employee’s performance in bank MFIs in Bamenda?

1.3.2 Specific Research Questions

1. What is the effect of financial crisis management on employee’s performance in MFIs in Bamenda?
2. What is the effect of personal Crisis on Employee’s Performance in MFIs in Bamenda?

• What is the effect of organization crisis management impact employee’s performance in Bamenda?

1.4. Objectives of Study

1.4.1. Main Objective

To determine the effects of crisis management on employee performance in MFIs Bamenda.

1.4.2. Specific Objectives

1. To examine the effect of financial crisis management on the of employee’s performance
2. To Assent the effect of personal crisis management on the performance of employees.

• To analyses the effect of organization the performance of the employees in crisis situation.