Effects of Outsourcing Employees on Organizational Performance in Commercial Bank of Ethiopia
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Date
2020-06
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Addis Ababa University
Abstract
Outsourcing is a management strategy through which a company assigns some non-core functions to more specialized, more effective and more efficient service providers such that the organization can be left to perform and concentrate with the core business activities. The aim of this study is to assess the effects of outsourcing on organizational performance at CBE. The researcher used Explanatory research design and purposive sampling to select a sample form in carrying out this study and targeted population of 200 branch managers from six major departments. Data was collected from primary sources through survey method by use of questionnaires. The quantitative data was analyzed through descriptive statistics and inferential analysis by use of statistical package for social sciences (SPSS) version 20 software. Both correlation and regression analysis were done and the results reviewed that: costs and the performance of the bank is having an insignificant strong positive relationship as implied by (r=0.137, p>0.134). Focus and the performance of the bank is satisfactory have a significant moderate positive relationship as shown by correlation coefficient of (r=0.278, p<0.002). There is a significant positive relationship between quality and the performance of the bank is satisfactory (r=0.375, p<0.000).
According to the regression analysis, quality driven outsourcing has a significant impact on performance (β= .263, t= 3.557, p < 0.05). However, since significant value p> .05 cost driven and focus driven outsourcing do not significantly predict performance. Finally the researcher recommended CBE should outsource with a clear picture in mind as to why they want to outsource
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Keywords
Outsourcing, Core Function, Organizational performance