An Assessment of Reward System in Relation to Organization Performance: A Case Study on Ethiopian Electric Power
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Date
2015-05
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Addis Ababa University
Abstract
The purpose of this research paper is to examine the impact of reward system on the performance of an organization and enables to understand the current needs of an organization and its employees to their intended objective. The low customer satisfaction, stakeholders, productive behaviour and the way how this behaviour could be altered and how to make their performance boost up (improve) to the organizational needs and demands would be the focus of the study. The research was carried out through constructive analysis from questionnaires and interview on reward system. Design/methodology/approach: The paper used an intensive case study executed by making use of descriptive survey method with the objective of EEP’s performance evaluation, reward strategy, policies, processes, and practices. Method and tools: Given that staff branch head office of Ethiopian Electric Company was the statistical population under study simple random sampling was used in this survey. Sample size was determined by own adapted means of Cochran formula (152 persons). Historical study and field study methods were the most important methods of data collection and data analysis was performed by means of SPSS statistical software. Findings: The findings suggest that the use of financial and objective measures are the main concern in designing the reward systems of the organization, companies are gradually incorporated non-financial measures in their reward systems. Other remarkable findings include identical rewards are not tied to different working nature performance which is found to be deviate from the normal norms. Research implications: The reward framework identified can be used as guideline for the total reward package to further understand the function of reward system and performance, thus design and implement their unique and attractive reward system. Originality/value – The paper shows that rewards lead to increase in both financial and non-financial performance which will also enhance companies’ reputation, as well as increase the recruitment possibility where more manpower will make a stronger team. Effective rewards mechanism will shift from fulfilling employees’ basic requirement to self-actualization as they are growing with the business.
Finally, the study has come up with a conclusion accompanied by suitable recommendations on the identified weaknesses and effect of reward system to organizations performance.
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Reward System in Relation