The Effect of Performance Management on Employee Motivation the Case of Diageo-meta Abo Brewery S.C

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Addis Ababa University


Employees play a pivotal role in determining the fate and success of a company. Theyare the main and unique resource organizations deploy in realizations of their objectives and goals. In today’s highly competitive and rapidly changing working environment, organizations need to acquire and retain the right number of competent employees to gain competitive advantage. In order to acquire and retain qualified personnel, organizations must unfold an HR system and HR management practices that are capable enough to win the heart and mind of employees over competitors. The objective of the study is to investigate the actual Performance management practice of the organization and see its effect on employee’s motivation. The beer industry is one of the most competitive sectors due largely to the regular innovations that are launched by the workers working for these firms. Although technology also plays a huge role on the success of these firms, human capital still remains the driving force in the highly competitive beer processing industry, having an effective performance management process that goes a long way to motivate employees of the organization. In this study, the researcher used both primary and secondary data sources. Primary data were collected through questionnaires and interview and secondary data for the study was added by referring relevant reports and documents with in and out-side of the organization. The researcher has used a descriptive research design to describe the practices and challenges of performance management system accurately and economically as well show its impact on motivation. Out of the sample frame of 750 employees, 325 employees are the target population which will be taken as a sample. To get representative opinion from the population the researcher applied simple random sampling technique. The sample size was determined using Raosoft and Macorr computer software’s ( and www. with confidence level of 95% both software’s resulted similar sample size of 177. The researcher also used regression and correlation tools to analyse the relationship of the variables. The correlation analysis result clarified that all relationship between the dependent and independent variables are positively and significantly correlated Additionally, it was found that performance management has higher impact on employee motivation. It is the objective of the researcher to determine what effect the current performance management system of the company has on employee motivation. Accordingly, a research done by Samira Al Jasmi on “The impact of approaches to motivation on employees’ performance and behavior” showed that employees with high performance rate are usually willing to give an extra effort to the organization when it is required as well as more motivated employees are tending to be more loyal to their organization and hence producing attractive outputs. The finding shows that an obvious relationship between motivation and employee performance exists and that if employees are motivated, they will produce better. Also showed that better performance will lead to high achievements and will result in greater motivation as when employees are motivated and satisfied; they have the authority to do the job required openly. It is recommended that the company should establish performance standards for each job levels and conduct performance review timely and continuously based on those standards.Moreover, appropriate and practical trainings that aim at increasing line manager’s knowledge of the subject matter of performance management should be among the priorities in the human resource department’s periodic training and development plans. Through practice and feedback training, Line managers should be given the opportunity to practice rating and are allowed to compare their ratings with those of experts in the field



Employees, organizations, HR management