THE INFLUENCE OF REWARD MANAGEMENT PRACTICES ON EMPLOYEE PERFORMANCE: A CASE STUDY OF COMMERCIAL BANK OF ETHIOPIA WEST ADDIS DISTRICT, GURAGE ZONE

Abstract

The purpose is to examine the effect of reward systems on the dimensions of employees’ perceived performance. This study also attempted to investigate what types of reward system; financial or non-financial contribute to the employees’ better performance. Both qualitative and quantitative research methods were applied. In order to select the respondents from the total population of 317, random sampling method was applied. The sample size determination comes with 177 samples to be taken in to the study. Survey data collected from respondent’s analyzed using descriptive and inferential analysis using the Statistical Package for Social Sciences (SPSS). The data was presented using tables. The findings of the study indicated that there was a significant relationship between reward system and employee performance in general and financial and non-financial rewards in particular. The result shows that, the most determinant factor of employee performance which scored low mean deviation was work condition (M=2.744, SD=1.036). While the high mean deviation scored for Performance based bonus (M=4.27, SD=0.688), followed by recognition (M=3.993, SD=0.802) career development (M=3.881, SD=.823), base Pay/salary (M=3.305, SD=0.815), benefit (M=3.063, SD=1.059). From this the researcher inferred that relatively low score work condition affects/determines employee performance. In addition, the findings of the study revealed that financial rewards (M=3.7875, SD= .755) strongly affect employees’ perceived performance than non-financial rewards (M=3.42, SD=0.93). Finally, of the total respondents agreed that, know what expected from them and what intends to do their performance based on the plan/target cascaded for them.