Effects of Reward Management on Employee Performance in Hotels in North Coast, Kenya

Abstract

Basing on the arguments of expectancy theory that employees expect a certain reward for their input in the organization and the influence this has on employee performance as depicted by the instrumentality theory, employee performance heavily rely on the kind of reward management practices used by their organizations. The reward management practices thus have a direct relationship with employee performance, (Ahmad et al, 2010). This is more desirable in the hotel industry in Kenya especially at a time when insecurity is affecting tourism and the industry calling for the industry to really market itself and gain strategic edge over the other tourist destinations. The industry is highly standardized thus the only left competitive tool in the quality of service offered by employees which is determined by employee performance. It is on this background that a study on effect of reward management on employee performance in the hotel industry in Kenya was carried out with an aim of optimizing employee performance in the industry as a means of gaining competitive edge over other destinations. The objective of the study was thus to determine the effect of reward management on employee performance in the hotel industry in Kenya. Therefore, the study used a descriptive cross sectional survey design which would give the quantitative relationship between the reward management practices employed and employee performance at a particular point in time to be used for generalization to other times. The study targeted the beach Hotels in North coast Kenya given that the industry is saturated in the area. Given that the study was a survey, there was no need of sampling and the study thus used all the 27 beach resorts in North Coast, Kenya. The study used primary data which was collected using structured questionnaires administered using the drop and pick method. The collected data was then sorted for validity and reliability and coded then quantitatively analyzed using mean and standard deviation. This was done independently for each of the variables. This was followed by a correlation analysis. The study found high correlation between reward management and employee performance. The study however found that as much as there was a reward policy in place, it was fairly weak as the reward strategies that have very high correlation with employee performance such as grade structure, performance appraisal and strategic reward were weakly implemented but concentration was on contingent pay and equal pay which have a relatively weaker correlation with performance. A recommendation was thus made for the hotels to change their reward policies in order to align the reward management practices based on their respective correlation to employee performance. The researcher also recommended for a study to establish the combination of various strategies that would optimize employee performance with emphasis of the proportion to which each strategy is to be used as well as a study to explore the modalities of applying job/grade structure in the hotel industry.