THE EFFECT OF REWARD MANAGEMENT PRACTICE ON EMPLOYEE PERFORMANCE: THE CASE OF ETHIOPIAN AIRLINES

Abstract

In the current competitive business environment, airlines industry is facing a lot of challenges particularly getting the qualified employees and retaining them. This study provides an overview of evidence of effect of reward management practice on employee performance in in Ethiopian airlines specifically on airport operation personnel, the objective of this research was to assess and examine the relationship between reward management practice and employee performance. The theoretical part of the study introduces different theories of rewards, motivation and performance. Both qualitative and quantitative research approach used through primary data collected from 291 customer service agents and supervisors and 9 passenger service managers respondents. Simple random sampling has been chosen to select respondents from a total of 1057 population using Yamane’s formula. A structure Likert Scale format questionnaire has been used and semi structured interview were prepared for data collection. Both questionnaire and interview questions consist of two parts; the first part of questionnaire comprises demographic respondent data while second part comprises three variables questions. The data obtained were analyzed using Statistical Packages for Social Science (SPSS) program, descriptive analysis, normality test, reliability test; multi collinearity test Person’s Correlation and Multiple Liner Regression were conducted in order to analyze the data. The main findings indicate that there is high and moderate relationship between intrinsic and extrinsic reward management practice on employee performance and has a high positive significant effect reward management practice on employee performance within the company. To improve employees work performance, the researcher recommended that adopting different kind of reward management practice, seek and obtain feedback on how employees perceive rewards and develop a sound retention and attraction mechanisms so as to get better performing employees as well as competitive airline. This study will help the company management to an implementation of attractive reward management practice.