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1 Reward Management Strategies on Employee REWARD MANAGEMENT STRATEGIES ON EMPLOYEE PERFORMANCE IN SELECTED UNIVERSITIES IN NAKURU COUNTY, KENYA MARY WAMBUI KATHOMBE A Research Project Submitted to Graduate School in Partial Fulfillment of the Requirements for the Award of the Degree of Masters of Human Resource Management of Egerton University EGERTON UNIVERSITY NOVEMBER, 2018 1 DEDICATION I dedicate this project report to my family. i COPYRIGHT All rights reserved. No part of this document may be produced, stored in retrieval system or transcribed in any form or by photocopying without this prior written permission of the author or Egerton University. © Mary Wambui Kathombe, 2018 ii DECLARATION AND APPROVAL Declaration This research project is my original work and has not been submitted or presented for examination in this or any other university. Signed………………………………………Date…………………………………. Mary W. Kathombe CH11/00117/09 Approval This research project has been submitted for examination with my approval as University Supervisor. Signed…………………… Date………………………. Dr. Simon Kipchumba, Lecturer, Department of Business Administration Egerton University iii ABSTRACT Rewards play an important role in increasing employee job satisfaction resulting in improving organizational performance. Motivated employees are the cornerstone of any successful organization. The main objective of this study was to establish the effects of reward management strategies on employee performance in selected universities in Nakuru County. The specific objectives were: to determine the effect of financial rewards on employee performance, to determine the effect of non-financial rewards on employee performance and to determine the combined effect of financial and non-financial rewards on employee performance. Descriptive survey design was adopted in conducting this study, as it was suitable for collecting information that described an existing phenomenon. The target population was 620 lecturers in two universities in Kenya namely Egerton and Kabarak Universities, which comprised a sample of 242 lecturers. The study primarily used a questionnaire to gather data from the respondents. Data from the questionnaire were systematically analyzed according to the research objectives and hypotheses. All hypotheses were tested using regression statistics and the results of the findings established that there is a strong positive association between combined effect of financial and non-financial rewards on employees‟ performance. According to the findings of this study, financial and non-financial rewards motivate employees to better performance. Thus, employee performance will be high in Kenyan universities that adopt an integrated effort on both financial and non-financial reward measurements. The study recommends the following: First, lecturers‟ promotion should be done regularly on merit. Secondly, Universities establish a competitive retirement benefit scheme to its employees. Third, Universities should engage their lecturers on regular training programs. iv TABLE OF CONTENTS DEDICATION ................................................................................................................................. i COPYRIGHT .................................................................................................................................. ii DECLARATION AND APPROVAL ........................................................................................... iii ABSTRACT ................................................................................................................................... iv TABLE OF CONTENTS ................................................................................................................ v LISTS OF TABLES ...................................................................................................................... vii LIST OF FIGURES ..................................................................................................................... viii CHAPTER ONE: INTRODUCTION ............................................................................................. 1 1.1 Background of the Study ......................................................................................................... 1 1.2 Statement of the Problem .......................................................................................................... 7 1.3 Objectives of the Study ............................................................................................................ 7 1.4 Research Hypotheses ............................................................................................................... 8 1.5 Significance of the Study ......................................................................................................... 8 1.6 Scope and Limitations of the Study ......................................................................................... 8 1.6.1 Scope of the Study ................................................................................................................ 8 1.6.2 Limitations of the Study........................................................................................................ 9 1.7 Operational Definitions of Terms .......................................................................................... 10 CHAPTER TWO: LITERATURE REVIEW ............................................................................... 13 2.1 Introduction ............................................................................................................................ 13 2.2 Theoretical Perspective ........................................................................................................... 13 2.2.1 Herzberg‟s Two Factor Theory ............................................................................................ 13 2.3 Reward Strategies ................................................................................................................... 14 2.4 Financial Rewards and Employee Performance ..................................................................... 15 2.4.1 Promotion ............................................................................................................................. 15 2.4.3 Incentives ............................................................................................................................. 17 2.5 Non-Financial Rewards and Employee Performance ............................................................. 19 2.5.1 Training ................................................................................................................................ 19 2.5.2 Job Enrichment .................................................................................................................... 22 2.5.3 Career Advancement ............................................................................................................ 25 2.5.4 Working Environment ......................................................................................................... 27 2.6 Conceptual framework ............................................................................................................ 28 CHAPTER THREE ...................................................................................................................... 30 RESEARCH METHODOLOGY.................................................................................................. 30 3.1 Introduction ............................................................................................................................. 30 3.2 Research Design...................................................................................................................... 30 3.3 Location of the Study ............................................................................................................. 30 3.4 Target Population of Study .................................................................................................... 30 3.5 Sampling Procedure and Sample Size .................................................................................... 31 3.6 Instrumentation ....................................................................................................................... 32 3.7 Data Collection Procedures..................................................................................................... 32 3.8 Validity and Reliability of the Research Instruments ............................................................. 33 3.9 Data Analysis .......................................................................................................................... 33 v CHAPTER FOUR ......................................................................................................................... 36 RESULTS AND DISCUSSION ................................................................................................... 36 4.1 Introduction ............................................................................................................................ 36 4.2 Descriptive Analysis .............................................................................................................. 36 4.2.1 Response Rate ...................................................................................................................... 36 Table 4.1 Demographic Attributes of the Respondents ............................................................... 37 4.3 Descriptive Analysis of Financial Rewards .........................................................................
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