The Impact of PMS on EP in the Commercial Bank of Ethiopia: the Case of Kirkos District
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Date
2025-03-19
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A.A.U
Abstract
This study examines the impact of the Performance Management System (PMS) at the Commercial Bank of Ethiopia's Kirkos District on employee performance (EP). The research focuses on four key components of PMS: performance planning, performance monitoring, performance review, and performance rewarding. Data was collected from a sample of 161 employees across 12 randomly selected branches and the district office. A combination of regression analysis and correlation tests was used to explore the relationships between these PMS components and employee performance. The study employed a descriptive and explanatory research design, incorporating both quantitative data from structured questionnaires and qualitative insights from open-ended responses. Secondary data was also gathered through document reviews of internal reports and external literature on PMS in the banking sector.
The analyses were performed using SPSS (Version 27). The results indicate significant positive relationships between all four PMS components and employee performance, with performance rewarding showing the strongest correlation (r = 0.712, p = 0.000). The regression model explains 87.4% of the variance in employee performance (R² = 0.874), confirming the positive influence of PMS practices. Statistical tests for normality, homoscedasticity, and autocorrelation confirmed the reliability of the findings. This study highlights the crucial role of a well-structured performance management system enhancing employee performance at the Commercial Bank of Ethiopia’s Kirkos District. The findings offer valuable insights for refining PMS practices in the banking sector and suggest avenues for future research.
Keywords: Performance Management System, Employee Performance, Commercial Bank of Ethiopia, Kirkos District, Performance Planning, Performance Monitoring, Performance Review, Performance Rewarding.