EFFECTS OF REWARD STRATEGY ON EMPLOYEE PERFORMANCE IN PRIVATEBANKS: AN EVIDENCE FROM ABYSSINIA BANK, ADDIS ABABA

Abstract

This study examines the effect of reward strategies on employee performance in the Western Addis Ababa districts of the Bank of Abyssinia. It aims to establish the relationship between employee performance and rewards, utilizing a Census method to collect data from bank employees in the targeted region. The study employed a self-administered questionnaire, and the data was analyzed using the SPSS statistical software, with both descriptive and inferential tools. The findings reveal that the six independent variables (employee salary, bonus, medical expense coverage, educational fee coverage, recognition, and career advancements) have varying degrees of positive relationships with the dependent variable, employee performance. Specifically, career advancements showed a strong positive relationship, followed by educational fee coverage, bonuses, and recognition, which had moderately positive effects. In contrast, medical expense coverage and employee salary had positive but weak relationships with performance. The regression analysis further supported these findings, indicating that the identified factors have significant and positive effects on employee performance in the bank. Overall, the study's results align with the existing theoretical and empirical literature, as both descriptive and inferential statistics confirm the identified factors.