Reward Management Practices and Employee Performance in the State Corporations in Kenya

Abstract

Kenya aspires to achieve high and sustained economic growth consistent with the governments’ employment, wealth creation and poverty reduction as per the vision 2030. To achieve this, the public sector which is the biggest employer must monitor the performance of its employees. The government through its employees manages and allocates resources to the citizenry through the various public institutions. Hence, the need to have proper and efficient monitoring mechanisms on performance of the public officers and factors contributing to unrealized targets. This study sought to establish the relationship between reward management practices on employee performance in the state corporations in Kenya through analysis of variables such as financial and non-financial rewards, employee benefits and work life balance benefits. Various theories were reviewed during this study to assess and enhance understanding on the variables. These include Abraham Maslow’s, Vrooms’ expectancy and Reinforcement theory. The study used descriptive and explanatory research designs and targeted 6 respondents from the 123 sampled state corporations totaling to 738. The study undertook a pilot study to pretest and validate the questionnaire. The probability and non-probability sampling were adopted and the study used stratified sampling and purposive sampling. The Cronbach’s alpha was used to check the reliability of the questionnaire which met the 0.7 and above threshold. Data was analyzed by use of SPSS and presented through percentages, means, standard deviations and frequencies. The information was displayed by use of bar charts, graphs, pie charts and in prose form. The study used regression analysis to test the significance of the variables at 5% significance level on the dependent variables. The study also tested for multicollinearity, heteroscedasticity, Normality, and goodness of fit of the regression model. The findings showed that non-financial rewards are a strong predictor of employee performance whereas financial reward, employee benefits and work life balance rewards moderately influence employee performance. Further the findings showed a significant moderating effect of motivation on the relationship between reward management practices and employee performance. The study recommends that organizations should seriously and keenly consider reward management practices both financial and non-financial rewards such as pay rise to promote a healthy competition among the employees as each will strive to work harder and give result in order to receive better pay or increase in their salary. The study further recommends that state corporations in Kenya needs to establish a reward management system and involve employees in determining acceptable and affordable rewards based on achievement of performance targets and the organization’s ability to pay or provide for these rewards.