Effects of Institutional Factors on Employee Performance in Commercial Banks in Kenya
Abstract
The Kenyan banking industry has to compete in the global market, and one way is to compete
by employing the best institutional practices that will stimulate employee performance.
However, in the recent past increased scale-down of personnel within the banking industry has
resulted in dwindling employee productivity. Further, the onset of the pandemic has brought
an emotional and physical challenges that may affect the employee performance within the
banking industry. This study reviewed how various institutional factors influence the employee
performance within commercial banks. The study focused on how organization culture,
organization structure, rewards and recognition and training and development influence
employee performance. The research was grounded on the expectancy theory, the social
exchange theory and the institutional theory. The study adopted a descriptive research design
in solving the study problem. The target population for this study was the human resource
managers of the 39 operational commercial banks. The study employed a census survey in the
selection of study respondents. The main tool used in the data collection was a structured
questionnaire that was developed guided by the study objectives. The study adopted drop and
pick method as well as Google forms in the data collection process. The collected research data
was analyzed using quantitative descriptive and inferential techniques. The study was able to
obtain a 90% response rate with 60% of the respondents being female staff in the banking
industry. The correlation results indicated a positive effect of organization structure, rewards
and recognition and training and development on the employee performance within the
banking industry. Based on the regression findings the study concluded that 57.3% the changes
in employee performance can be predicted by the training development, rewards recognition,
organization structure, organization culture within the commercial banks. The study
recommends that the banks should stimulate an innovative culture which will ensure that the
employees are able to tackle task and other responsibilities using emerging practices and
technologies. Its’ also recommend that the bank should expand the welfare programs offered
to their employees as a measure of stimulating employee productivity. The study recommends
that commercial banks should empower their employees through offering free professional
development programs which will improve their competencies and skills.
Publisher
University of Nairobi
Rights
Attribution-NonCommercial-NoDerivs 3.0 United StatesUsage Rights
http://creativecommons.org/licenses/by-nc-nd/3.0/us/Collections
- School of Business [1411]
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