The effects of reward system on employee performance in National water conservation & pipeline corporation, Nairobi
Assava, Solomon Musiega
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The main objective of this study was to determine the effects of reward system on employee performance in National Water Conservation and Pipeline Corporation. In line with this, the study sought to achieve the following specific objectives: To establish the impact of extrinsic rewards on employee performance, to determine the influence of intrinsic rewards on employee performance and to examine the effects of monetary rewards on employee performance. In order to collect data necessary for the realization of the research objectives, a descriptive study design was adopted. The target population consisted of 206 employees. However, due to some limitations especially associated with time and cost, a sample size of 103 elements representing 50 per cent of the sample frame was used. Data collection was done using a standard self-administered questionnaire which was distributed to the respondents. The data was analyzed using the Statistical Program for Social Scientists (SPSS) to obtain descriptive statistics in terms of the mean, mode, median and frequencies. Data presentation was in form of frequency tables, mean, charts, and graphs. The study findings on the existence of a reward system in NWC&PC indicated that indeed there exists a reward system in the organization, although not a comprehensive one. This is because only 56 per cent of the respondents supported this opinion. At the same time salary and wages, annual performance bonuses as well as monthly target based incentive schemes were all ranked highly as proof of the existence of a reward system in the organization. The findings on the relationship between reward system and the organization performance showed that indeed there exists a relationship between the two as confirmed by a majority of respondents, who shared similar opinion. It was further revealed that the majority of the respondents were of the opinion that the reward system impacts on the overall performance of the organization. In light of these findings, the study concluded that Employees at NWC&PC value monetary rewards, such as salary and wages, annual company performance bonuses and monthly target based incentive schemes as important for good performance. At the same time they regard the following as valuable non-monetary rewards for good performance: informal praise from superior (thank you); formal praise from superior (certificate); symbolic gifts (caps, t-shirts); mention in monthly magazine. It can be concluded that non-monetary rewards playas important a role in reward schemes as monetary rewards. Remuneration packages should integrate monetary rewards to satisfy the basic needs of employees. These basic needs include food, clothing shelter, transport, and medical cover. It is imperative that the basic needs are first satisfied with monetary rewards. The study further recommends that the needs of employees, should be seriously considered when designing and implementing a reward system to motivate staff to perform at their best. From the conclusions of this study it is clear that non-monetary rewards should be included in reward schemes. Secondly the study recommends that it is important for NWC&PC to involve the employees when determining the performance standards.