Effect of Performance Measurement on Employee Engagement in Multinational Corporations in Kenya

Abstract

The Primary goal of this study is to research the effect of performance measurement on employee engagement in Multinational Corporations operating in Nairobi County. This study will have lots of contributions to the business world. Multinationals operating in Kenya and other organizations may improve or change their performance measurement systems adopt more efficient and effective ones. In this study, employee engagement levels depend on performance measurement. The study was guided by the overall objective which was to determine the effect of performance measurement on employee engagement in multinational corporations in Kenya. The theoretical review of the study was founded on the goal setting theory, Adams equity theory, the agency theory and the three component model of employee engagement. The research adopted a descriptive research design to investigate the aspects of performance measurement and employee engagement as they are. The research utilized random sampling technique to select the sample for the study. The population size for the study was 3,334 individuals drawn from employees both in management and lower level subordinate staff working for AON Kenya, Airtel, Barclays, DHL, EABL, Jubilee Insurance, Maersk, Safaricom, Standard Chartered and Unilever at their head offices in Nairobi County. The sample size for the study was based on a stratified random sampling technique, giving a total of 180 respondents from the ten firms. A questionnaire was designed to help in the primary collection of data which was sorted, edited and analyzed using SPSS version 23. The coded data was analyzed using both descriptive and inferential statistics. The findings of the research were presented in the form of tables, charts and figures. Findings also showed the balanced scorecard was adopted mostly through the customer perspective. Findings also showed that the management involve employees in decision making as well as checked on the well-being of employees and developed better working conditions. Findings further showed that performance indicators were also adopted in the majority of the firms. Generally, the study finds statistically significant relationship between the independent variables (Balanced Scorecard, Management by Objectives and Sales Performance Indicators). The study recommends that the government should be involved in supervising and regulating MNC to ensure that fair employee treatment and compensation is achieved. The study recommends training of staff to equip the administrators with requisite skills that will enable the successful application of the BSC to deliver the intended strategy as well as keep up with changing business dynamics. The study also recommends that technology should be adopted in performance measurement tools now that the world is changing to digitalization. The multinational Corporations gained practical knowledge on the effects of given performance measurement tools on employee engagement thereby enriching their knowledge base on how to enhance employee engagement. Future studies may study on other variables which were not covered in this study. The study concludes that Performance measurement tools have a positive impact on the levels of employee engagement. Multinational Corporations operating in Kenya are faced with the challenge of selecting a performance measurement system that is a acceptable, localized and at the same time effective to the work environment. The corporations must performance measurement seriously if they are to affect employee engagement positively.