School of Commerce

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Browsing School of Commerce by Subject ": High-Performance Work Systems"

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    The Effect of High-Performance Work Systemon organizational Performance In Case of Selected Microfinance Industry (Vision Fund, Peace, Harbu And Nisir)
    (Addis Ababa University, 2025-09) Tekalign Daba; Solomon Markos (PhD
    The study takes a comprehensive approach to examining the relationship between High-Performance Work Systems (HPWS) and organizational performance within the context of microfinance institutions (MFIs). A quantitative research design was utilized, and structured questionnaires were administered to a sample of 213 employees from four notable MFIs: Vision Fund, PEACE, Harbu, and Nisir. A descriptive analysis of the 213 respondents reveals significant demographic characteristics, including educational levels, age distribution, and organizational tenure, which enhance the contextual understanding of the data. Correlation analysis shows strong positive relationships among key HR practices, including recruitment and selection, training and development, compensation and benefits, performance appraisal, and employee engagement, with correlation coefficients ranging from 0.43 to 0.78 (p < 0.01). Regression analysis identifies employee engagement as the strongest predictor of organizational performance (Beta = 0.425, p < 0.001), followed by performance appraisal (Beta = 0.262, p = 0.003) and recruitment decisions (Beta = 0.193, p = 0.013). The model accounts for 51.8% of the variance in organizational performance, indicating strong predictive capability. Hypothesis testing conducted with the Kruskal-Wallis test confirms that effective recruitment, comprehensive training, objective performance appraisals, competitive compensation, and high employee engagement significantly impact organizational performance (all p < 0.05). These findings underscore the importance of integrated HR practices in enhancing organizational outcomes. They suggest that organizations should prioritize employee engagement and performance appraisal strategies to improve overall performance. The results offer actionable insights for HR practitioners and organizationaleaderslooking to cultivate a productive work environment in the competitive microfinance sector.