ASSESSMENT OF EMPLOYEES REWARDING SYSTEM PRACTICES IN SELECTED BANKS OF ETHIOPIA

Abstract

Employees remain the greatest asset of any organization, whilst they provide performance, organizations offer rewards. A well designed system for rewarding employees greatly has a bearing on the output of employees and therefore impact organizational objectives as a whole. The study aimed at providing an objective view of organizations reward systems. It assessed the rewarding systems of selected banks in Ethiopia (Commercial Bank of Ethiopia, Development Bank of Ethiopia, Awash international Bank, Dashen Bank and Bank of Abyssinia) and evaluated how the existing rewarding system (both intrinsic and extrinsic) managed and administered further it determine the level of employees’ participation in the rewarding system design. To arrive at a sound conclusion, descriptive method of research with a mixed approach of qualitative and quantitative theme was applied. The research gathered data from two main sources namely primary and secondary sources. The two main techniques employed in gathering the primary data were questionnaire survey and interviews. It was found out from the study that, organizations lack strategic reward systems that align the strategic objectives of the organizations to that of employees’ personal objectives. It was also revealed from the study that there were less employees participation in determined what constitutes the reward packages. It was recommended that compensation packages should be linked to employee motivation and satisfaction. The rewards should provide value for money. In other words, more should be derived from the reward in terms of productivity and profitability than the cost of rewarding. Again, it was essential on organizations to create extrinsic as well as intrinsic reward systems for the motivation and retention of the best employees.