EFFECTS OF EFFICIENT REWARD SYSTEM ON PERFORMANCE OF EMPLOYEES.

CASE OF KITUI COUNTY PUBLIC SERVICE BOARD

PRESENTER: KAVUTHA MWENDWA

INDEX NUMBER: 3071030076

INSTITUTION: WOTE TECHNICAL TRAINING INSTITUTE

SUPERVISOR: ALICE NGARIKA

SUBMITTED TO KENYA NATIONAL EXAMINATION COUNCIL FOR THE PARTIAL

FULFILMENT FOR THE AWARD OF DIPLOMA IN HUMAN RESOURCE MANAGEMENT

DATE: JULY 2025 SERIES

 DECLARATION

I declare that this project is an original document and work after findings of my research. Any
entry which may resemble any document in whatsoever by coincidence due to thorough and deep
research and guidance given by my project supervisor Madam Alice Ngarika and all those who
made entire document successful.

SIGN: ___________________ DATE: ____________________

KAVUTHA MWENDWA

INDEX NO: 3071030076

The research project has been presented for examination with my approval as the appointed

supervisor.

SIGN: __________________ DATE: _____________________

ALICE NGARIKA

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 DEDICATION

I dedicate this research project to my parents for their commitment towards the entire journey of
my education.

I dedicate this project to God Almighty, my strong pillar and source of inspiration, knowledge

and wisdom to carry out this project. I also dedicate this work to my parents who have

encouraged me and have tirelessly financed me to be able to go through this project and attain

my desired dream. Lastly, my project lecturer Madam Alice who made this really a success by

guiding me.

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 ACKNOWLEDGEMENT

On the occasion of presenting this project, I wish to express my deep and profound feelings of

gratitude to number of persons who have contributed to its completion.

First and foremost, I express deep gratitude to Almighty God for bestowing His blessings upon

me throughout the research work and completing successfully.

I am grateful for Madam Alice my project lecturer in charge for guidance in writing this project

documentation.

I also express my heartfelt gratitude to my parents Mr. and Mrs. Mwendwa for their love, prayer

and sacrifice and preparing me for future. I am thankful to my sister for the love and mental

support for making research a success. Special thanks to my friends for their interest they shown

to complete the project successfully.

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 ABSTRACT

This research project focused on investigating the effects of an efficient reward system on the
performance of employees, using Kitui County Public Service Board (KCPSB) as a case study.
In today’s public service institutions, employee performance is a critical factor for achieving
effective service delivery, and one of the major influences on performance is how employees are
rewarded. The study explored both monetary rewards such as salaries, allowances, and bonuses,
and non-monetary rewards including promotions, recognition, and training opportunities. The
aim was to determine how these rewards influence employee motivation, job satisfaction, and
overall productivity. A descriptive research design was adopted for the study, and data were
collected through structured questionnaires and interviews administered to a sample of 50
employees across various job levels. The data collected were analyzed using descriptive statistics
such as frequencies, percentages, and charts. The findings revealed that while most employees
acknowledged the presence of a reward system in the organization, many were dissatisfied with
its fairness, consistency, and transparency. This dissatisfaction was attributed to challenges such
as budget limitations, favoritism, delayed promotions, and lack of a clear reward policy. The
study established that an efficient reward system—characterized by fairness, timely recognition,
performance-based incentives, and inclusivity—plays a significant role in improving employee
morale, reducing turnover, and enhancing service delivery. Both monetary and non-monetary
rewards were found to contribute meaningfully to employee performance when well-structured
and appropriately implemented. Furthermore, the research highlighted the importance of aligning
reward systems with employee expectations and performance appraisal frameworks. The study
emphasized that clear communication of reward criteria and regular reviews are essential to
building trust and ensuring that employees remain motivated to achieve organizational goals. The
project also demonstrated that integrating employee feedback in designing reward systems
increases their effectiveness and relevance. Based on these insights, the research recommended
that KCPSB should adopt a performance-based reward framework, enhance transparency in
reward allocation, conduct regular salary reviews, and invest in continuous employee
development programs. By doing so, the Board will improve employee satisfaction, foster a
motivated workforce, and ultimately contribute to more efficient and reliable public service
delivery in Kitui County.

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Table of Contents
DECLARATION............................................................................................................................. ii
DEDICATION ............................................................................................................................... iii
ACKNOWLEDGEMENT ............................................................................................................. iv
ABSTRACT .................................................................................................................................... v
CHAPTER ONE ............................................................................................................................. 1
1.0 Introduction ........................................................................................................................... 1
1.1 Background of the study ....................................................................................................... 1
1.2 Statement of the problem ...................................................................................................... 3
1.3 Research Objectives .............................................................................................................. 4
1.3.1 General Objectives ......................................................................................................... 4
1.3.2 Specific Objectives ........................................................................................................ 4
1.4 Research Questions ............................................................................................................... 4
1.5 Significance of the study ....................................................................................................... 5
1.6 Scope of the study ................................................................................................................. 5
1.7 Limitations of the study ........................................................................................................ 5
1.8 Operational definition of terms ............................................................................................. 6
CHAPTER 2 ................................................................................................................................... 7
LITERATURE REVIEW ................................................................................................................ 7
2.0 Introduction ........................................................................................................................... 7
2.1 Theoretical framework .......................................................................................................... 7
2.1.1 Maslow’s Hierarchy of needs theory ............................................................................. 7
2.1.2 Incentive theory of motivation ....................................................................................... 9
2.1.3 Vroom’s Expectancy theory of motivation .................................................................. 10
2.2 Conceptual Framework ....................................................................................................... 12
2.3 Empirical Review................................................................................................................ 13
CHAPTER THREE ...................................................................................................................... 15
RESEARCH METHODOLOGY.................................................................................................. 15
3.0 Introduction ......................................................................................................................... 15
3.1 Research Design.................................................................................................................. 15
3.2 Population of the study ....................................................................................................... 16
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 3.4 Instruments of Data Collection ........................................................................................... 18
3.5 Validity of the instrument.................................................................................................... 19
3.6 Data Collection Procedure .................................................................................................. 19
3.7 Method for data analysis ..................................................................................................... 20
CHAPTER FOUR ......................................................................................................................... 21
FINDINGS, DATA ANALYSIS, CONCLUSION AND RECOMMENDATION ....................... 21
4.1 Data Presentation. ............................................................................................................... 21
4.1.2 Age distribution of respondents ................................................................................... 23
4.1.3 Level of education........................................................................................................ 24
4.1.4 Job level ....................................................................................................................... 26
4.1.5 Employee perception on existing reward system......................................................... 26
4.1.6 Effectiveness of monetary and non-monetary rewards ................................................ 28
4.1.7 Challenges in implementing reward system ................................................................ 29
4.3 Interpretation of data ........................................................................................................... 33
4.4 Discussion of findings......................................................................................................... 34
4.5 Summary ............................................................................................................................. 36
REFERENCES ............................................................................................................................. 37
APPENDIX ................................................................................................................................... 41
RESEARCH QUESTIONNAIRE ................................................................................................ 41

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List of tables

Table 1: Population of study ......................................................................................................... 17

Table 2: Sampling ......................................................................................................................... 18
Table 3:Demographic information ................................................................................................ 22
Table 4:Age of respondents .......................................................................................................... 23
Table 5:Educational qualification ................................................................................................. 24
Table 6:Level of job ...................................................................................................................... 26
Table 7:Perception of employees .................................................................................................. 26
Table 8:Effectiveness of rewards .................................................................................................. 28
Table 9:Challenges in implementation.......................................................................................... 29
Table 10:Suggestions .................................................................................................................... 31

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List of Figures

Figure 1:Conceptual framework ................................................................................................... 12

Figure 2:Gender Distribution ........................................................................................................ 22
Figure 3:Age of respondents ......................................................................................................... 24
Figure 4:Education level ............................................................................................................... 25
Figure 5:Employee perception ...................................................................................................... 27
Figure 6:Types of rewards ............................................................................................................ 29
Figure 7:Challenges in implementation of reward system ........................................................... 31
Figure 8:Strategies for improvement of reward system ................................................................ 33

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List of Abbreviation

KCPSB: Kitui County Public Service Board

HR: Human Resource

HRM: Human Resource Management

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 CHAPTER ONE

1.0 Introduction

Many organizations recognized that an efficient reward system was essential for enhancing

employee performance and improving overall organizational effectiveness. A Reward system

involves both monetary and non‑monetary aimed at compensating and motivating employees.

When well designed, such a system not only encourage better performance but also support the

development of employee skills, foster job satisfaction, and help attract and retain talented

personnel.

This research sought to examine various types of reward system used in organization, assess their

impact on employee performance, and propose solutions to challenges associated with reward

practices in Kitui County Public Service Board.

1.1 Background of the study

Most employers aimed to adequately reward their employees for their services. However,

rewards varied in content and size among the organizations, which may partly have explained

why disagreements arose between management and employees. According to (Armstrong and

Brown,2009), reward management revolved around the preparation and execution of policies and

strategies that aligned with organization values, focusing on fairness and equality in rewarding.

Maintaining reward practices and implementing various designs enabled the evaluation of

motivation by assessing employee performance and its contribution to organizational

improvement. A reward was considered a return for a service rendered, an act that strengthened

1
approved behavior and equaled achievement. Monetary rewards addressed basic needs such as

stability and survival, aligning with the lower levels of Maslow’s hierarchy of needs. Non-

monetary rewards were often psychological in nature, linked to self-efficacy, competence and

enjoyment derived from task completion, social interaction or a positive work environment,

corresponding to higher level needs (Bratton et.al,2007). Organizational policies and practices

that emphasized employee rewards played a key role in motivation and retention. They

contributed to motivating and retaining employees, which was an added benefit to the company.

(Armstrong,2007) identified two types of reward systems: monetary and non‑monetary.

Monetary rewards continuously motivated employees to dedicate efforts to daily tasks and align

with organizational goals. These included: allowances, bonuses and other financial incentives.

Non-monetary rewards included recognition, growth opportunities and other benefits that

employees valued beyond financial position. As (Crosby,2001) stated, people did not work solely

for money; once their salary was met, they sought appreciation. These non‑monetary rewards

fostered stronger employer ‑employee relationships.

(Pierce,2000) argued that performance was always a function of motivation and ability.

Motivation comprised elements that made employees enjoy and perform their duties effectively,

with rewards playing a key role. In today’s context, organization implemented strategic

management practices to improve performance across departments such as finance, sales and

marketing.

Kitui County Public Service Board is responsible for recruiting and developing the County’s

Public Service workforce. It oversees a diverse workforce across departments such as health,

education and infrastructure.

2
1.2 Statement of the problem

Employee performance is a critical factor in ensuring efficient service delivery in the public

sector. In KCPSB, employee motivation and productivity were greatly influenced by the reward

system in place. However, concerns emerged regarding the effectiveness of current reward

mechanisms in enhancing performance. Issues such as ghost workers, irregular promotions and

unauthorized recruitment indicated gaps in the County’s HRM negatively affecting employee

motivation and overall service delivery.

An efficient reward system, comprising fair compensation, performance based incentives, career

development opportunities and recognition program were essential in fostering employee

motivation and productivity. Challenges such as promotion delays, inconsistent remuneration and

inadequate recognition of contributions negatively affected job satisfaction, morale and service

delivery.

Despite numerous studies on the relationship between rewards and employee performance,

limited research focused on County Government especially Kitui County. Understanding how an

efficient reward system enhanced employee performance at KCPSB was crucial for improving

public service delivery. This study assessed the effects of a well‑designed reward system on

employee performance, identified gaps, and proposed improvements.

3
1.3 Research Objectives

1.3.1 General Objectives

To assess the effects of an efficient reward system on performance of employees in Kitui County

Public Service Board

1.3.2 Specific Objectives

1. To examine the existing reward system in Kitui County Public Service Board and its

influence on employee motivation and job satisfaction.

2. To assess the relationship between monetary and non-monetary rewards and employee

performance in KCPSB.

3. To analyze challenges faced in implementing an efficient reward system in Kitui County

Public Service Board.

4. To recommend strategies for improving the reward system to enhance performance and

service delivery in KCPSB.

1.4 Research Questions

1. To what extent did the existing reward system in KCPSB influence employee

motivation and job satisfaction?

2. Did the type of reward (monetary or nonmonetary) significantly impact on

employee performance in KCPSB?

3. What challenges were encountered in implementing an efficient reward system in

Kitui County Public Service Board?

4. To what extent can did improving the reward system enhance employee

performance and service delivery in KCPSB?

4
1.5 Significance of the study

The findings from this study benefited stakeholders like:

 Kitui County Government ‑the research finding helped design and implement more

effective reward system that enhanced employee motivation and productivity.

 Public Service Board employees‑ employees benefited from recommendations that

promote fair compensation and recognition, leading to increased job satisfaction and

performance.

 Human Resource Practitioners ‑ HR managers in public sector used the findings to

formulate reward policies aligned with employee expectations and organizational goals

1.6 Scope of the study

The study was carried out in Kitui County, Kenya within the offices of Kitui County Public

Service Board. It analyzed the existing reward system in KCPSB both the monetary (salaries,

allowances, bonuses) and non‑monetary rewards (promotion, recognition). It also identified

challenges in implementing an efficient reward system and suggested strategies for

improvement.

1.7 Limitations of the study

The researcher likely encountered various limitations like:

a) Reluctance from some county officials to provide information due to confidentiality

reasons

b) The researcher faced financial constraints for printing data collection materials and

transportation budget, which limited the sample size.

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 c) The researcher had limited time thus getting in-depth into data collection was difficult.

1.8 Operational definition of terms

Reward System‑ a structured program that acknowledges and rewards employees for their

performance, behaviors or achieving specific goals.

Employee performance‑ reefers to how well a person executes their job duties and

responsibilities.

Monetary Rewards- specific amount of money given to an employee for completion a task or

goal.

Non‑monetary rewards‑ are the types of benefits that do not involve money like flexible

working hours.

Public Service Board ‑ a body established under Article 235 of the Kenyan Constitution and

section 57 of the County Government Act to manage County Public Service functions.

Job satisfaction‑ refers to the degree of pleasure/ happiness that an individual will experience in

their job.

6
 CHAPTER 2

LITERATURE REVIEW

2.0 Introduction

This chapter provides a review of what other researchers and authors have written about reward

system and how they affected employee performance. It helped in understanding ideas, findings

and opinions of different experts on the topic. The aim of this chapter was to gather knowledge

from previous studies related to the research topic; “effects of an efficient reward systems on

employee performance in Kitui County Public Service Board”.

The chapter discussed concepts such as reward system, employee performance and motivation.

Different theories related to motivation were discussed, explaining why employees behaved the

way they did and how rewards influence their performance.

2.1 Theoretical framework

2.1.1 Maslow’s Hierarchy of needs theory

Abraham Maslow proposed this theory in 1943.It was one of the most important theories in

understanding human motivation and its application in organizations. Maslow claimed that for

every human being, a hierarchy of five needs existed (Maslow,2013). These needs included

psychological needs, safety needs, social needs, esteem needs and self‐actualization needs.

In Maslow’s theory lower level needs were to be satisfied first before moving to higher level

needs. In context of rewards, needs entailed internal states that make certain outcomes appear

attractive.

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The theory suggested that for employees to be motivated and productive, organizations needed to

design reward systems that satisfied needs at each level of the hierarchy. Reward systems were to

be aligned carefully with the level of needs an employee was experiencing and ignoring this

reduced motivation (Robbins and Judge,2013). Salaries and wages helped meet psychological

needs like food, shelter and clothing.

Job security and safe working environment catered for safety needs. This included; permanent

contracts, health insurance and retirement benefits. Security related rewards like; pensions and

health coverage were essential in creating a stable and secure workforce(Armstrong,2006). These

needs were satisfied by promoting teamwork, social events and having a collaborative work

culture. (Mullins,2010) stated that workplace friendships and positive team dynamics enhanced

commitment and reduced turnover.

Esteem needs referred to the desire for recognition, respect and appreciation. At this level of

hierarchy, non‑monetary rewards like promotions, praise, awarding best employee of the month

and public acknowledgements were effective. (Greenberg and Baron,2008) suggested that

esteem‐based rewards had a long lasting impact on employee engagement and morale. In

addition, (Luthans,2011) affirmed that non‑financial rewards were critical in fostering sense of

value among employees and could often be more powerful than monetary incentives.

Self‐actualization needs were at the peak of the hierarchy and referred to the state of completely

realizing one’s potential and doing what they were capable of doing. Organizations supported

self‑actualization by offering training and development retain their most talented and ambitious

employees (Kreitner and Kinicki,2008). (Latham,2007) argued that reward strategies that

8
included personal development and career advancement ensured employees felt fulfilled and

were more likely to contribute positively to organizational goals.

This theory was relevant to public sector where employees were driven by both financial and

non‐financial motivations. In KCPSB different categories of employees were at different levels

of hierarchy. Junior staff were more focused on psychological and safety needs while senior staff

sought esteem and self‑actualization through recognition, involvement in decision making and

growth opportunities.

2.1.2 Incentive theory of motivation

Incentive theory of motivation explained that people were motivated to do something when they

expected to get a reward. It focused on external rewards like money, praise, promotions rather

than internal feelings. Incentives were things in the environment that pushed people to act

because they hoped for a good result. (Atkinson,1964). In workplaces, these rewards were used

to improve employee’s behavior and performance.

(Deci and Ryan,1985) noted that factors like salary, bonuses, promotions or recognition strongly

influenced how people acted at work. When these rewards were linked to performance, they

encouraged workers to work harder and align with company goals. (Schunk et al., 2014) stated

that incentives worked well because they offered immediate gratification, making people to

repeat good behavior.

This was useful in public institutions like Kitui County Public Service Board, where workers did

not always feel motivated just by the nature of their job. (Gneezy, Meier and Ray‐Biel,2011)

9
argued that for incentives to work well, they had to be seen as fair, valuable and possible to get.

If employees felt the reward was too small or hard to get, their motivation declined.

(Luthans,2011) stated that using incentives in reward system helped make employees more

involved and committed to the organization. (Nelson,2003) agreed, saying that incentives not

only boosted performance but also helped employees feel satisfied and stay longer in their jobs.

However, if incentives were poorly used, they could create problems. (Kohn,1993) warned that

giving too many external rewards could reduce the natural interest people have in their work.

Therefore, incentives had to be balanced with other motivational strategies, like opportunities for

learning and growth.

(Armstrong and Taylor,2004) emphasized that different jobs or employees were not the same, so

organizations should use different kinds of rewards depending on what works best for each

person or job. For instance, some workers preferred time off or recognition while others

preferred bonuses or promotions.

To sum up, the theory supported that reward system should offer clear, fair and timely incentives

to improve employee performance. When done correctly, it created a motivated, committed and

best performing workforce.

2.1.3 Vroom’s Expectancy theory of motivation

Vroom’s expectancy theory, developed by Victor Vroom in 1964, explained that people only

worked hard if they believed their effort would lead to good performance and that performance

would lead to a reward they truly wanted. (Vroom,1964) said that motivation depended on three

10
things; expectancy- (belief that effort would lead to performance), instrumentality‐ (the belief

that performance would lead to a reward), and valence- (how much a person valued the reward).

It meant that an employee was only motivated if they believed their hard work would pay off, if

they trusted that good performance would be noticed, and if the reward was something

meaningful to them. (Lunenburg,2011) explained that if even one of these three parts was

missing, motivation would be very low. In Kitui County Public Service Board, this theory was

relevant because who employees didn’t think their effort would be rewarded, were not likely to

give their best at work. (Robbins and Judge,2019) said that employees often lost motivation

when they didn’t see a clear link between their hard work and the rewards they received.

(Mullins,2016) supported this view, and said that this theory worked well with

performance‑based pay because it encouraged employees to work hard when they knew their

efforts were rewarded. That is why it was important for public organizations to ensure rewards

were given fairly and were based on results.

(Dessler,2020) argued that this theory helped employers create better reward systems by making

sure employees clearly understood how rewards were connected to their performance. When

rewards were given based on performance, workers felt more motivated and appreciated.

However, if employees felt that the reward system was not fair or that rewards were given

without considering performance, they could stop trying. (Borkowski,2011) mentioned that

unfair reward system lead to frustration and low motivation, even if employees were putting in

effort.

11
 (Nelson,200) emphasized that if performance was desired, it had to be rewarded. Organizations

needed to reward behaviors they wanted to see more and if they rewarded something else,

employees would focus on that instead. In conclusion, Vroom’s theory showed that employees

performed better when they believed their hard work would lead to good results and meaningful

rewards. Public Service organizations were encouraged to design clear and fair reward system

that employees trusted and valued.

2.2 Conceptual Framework

INDEPENDENT VARIABLE

Efficient Reward System DEPENDENT VARIABLE

Monetary rewards

 Salary
Employee Performance
 Bonuses
 Allowances Quality of work
 Commissions
Attendance

Innovation

Timeliness

Task completion
Non‑Monetary rewards

 Promotion
 Recognition
 Training
 Flexibility

Figure 1:Conceptual framework

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2.3 Empirical Review

(Wambugu and Ombui,2013) conducted a study on the role of rewards in enhancing employee

performance in the public sector in Nairobi. They found that both intrinsic and extrinsic rewards

played a major role in shaping employee behavior. They concluded that consistent use of rewards

that matched employee expectations helped increase organizational performance and staff

engagement.

A study by (Kassa and Raju,2015) on reward systems in the public sector showed a strong link

existed between employee motivation and performance based incentives. Their results

highlighted that effective rewards increased job satisfaction and reduced absenteeism. They also

emphasized that fairness and clarity in reward distribution influenced staff trust and commitment.

According to (Kipkoech and Bett,2019), a research study on reward systems in county

governments in Kenya revealed that inadequate and unfair reward mechanisms led to high staff

turnover and poor performance. Their results showed that where rewards were based on

favoritism or lacked clear performance measurement, employee motivation was generally low.

This supports that an efficient reward system should be transparent, performance based and

inclusive.

In a study by (Mwangi and Waiganjo,2017). It was found that both financial and non‑financial

rewards significantly influenced employee productivity in public service institutions in Kenya.

Their finding indicated that rewards such as bonuses, salary increment, recognition and career

development programs contributed positively to employee morale and output.

13
A local study conducted by (Makori and Oyondi,2020) among staff in Kisumu County indicated

that lack of structured reward system especially nonmonetary rewards such as recognition, job

security and training opportunities contributed to demotivation among workers. Their findings

recommended integration of both monetary and non-monetary rewards to ensure staff motivation

and retention.

(Armstrong and Taylor,2014) noted that modern reward system need to align with performance

appraisal systems. Their analysis showed that integration of employee feedback, regular reviews

and performance related pay boosts employee satisfaction and goal alignment. This aligns with

findings from Kenya and other African Context.

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 CHAPTER THREE

RESEARCH METHODOLOGY

3.0 Introduction

This section introduces the overall approach that the researcher would use in conducting the

study. It explains importance of using proper methodology to achieve authentic and useful

results. Research methodology helped researcher stay focused on the objectives of the study

while ensuring that data collected was reliable, valid and applicable.

In this study the researcher aimed to investigate effects of an efficient reward system on

performance of employees within Kitui County Public Service Board. This objective was

achieved by having appropriate strategies put in place. The strategies included: choice of the

right design, selection of the right people who participated in the study, use of right tools for data

collection and application of accurate methods of analysis of collected data.

3.1 Research Design

The study adopted descriptive research design. According to (Kothan,2014), descriptive research

is concerned with description of characteristics of particular individual, group or situation. This

method was appropriate for the study as it enabled the researcher to collect detailed information

regarding effects of an efficient reward system on performance of employees.

Descriptive research design was suitable when aim was to gather information about present

conditions such as observation, questionnaires and interviews(Mugenda&Mugenda,2003). This

design would allow researcher examine relationship between different forms of rewards‑like

financial incentives, recognition, promotion and how they affected employee performance. It

15
also helped in identification of patterns, attitudes and opinions among employees regarding

reward system in place.

The design made it possible to collect both qualitative and quantitative data, enhancing accuracy

of research findings. Qualitative data was gathered through interviews. The data collected was

analyzed and relationship established between reward system and employee performance.

Descriptive research also facilitated comparison across different departments within Kitui

County Public Service Board, which enabled researcher generalize findings to larger population.

This design was less time consuming and cost effective making it best for available research

resources and timeframe.

3.2 Population of the study

The unit of study is referred to as population of the study. It refers to all characteristics which are

used in making some inference while sample population refers to carefully selecting members of

target population who serve as representative section of that

population(Cooper&Schindler,2008). target population for study consisted of all employees of

Kitui County Public Service Board. According to the County’s HR department. There are 200

staffs including senior managers, middle level and junior staff. The study focused on this

population because it consisted of individuals directly affected by reward system which made

them relevant for the study. Their feedback was valuable in understanding effectiveness of

reward strategies employed by the board.

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Table 1: Population of study

Level of management Frequency Percentage

Top management 30 15%

Middle level management 50 25%

Lower level management 120 60%

Total 200 100%

Source: Author’s field data

3.3 Sampling

(Kothari,2004) defined sample as small group of respondents drawn from population about

which researcher interested in getting information to arrive at conclusion. In the research, the

sample was made from 50 out of 200 employees at the Kitui County Public Service Board. This

sample size was manageable for the researcher and was still large enough to provide meaningful

data that was generalized to the entire organization.

To select the sample, the researcher used probability and non-probability. A combination of

purposive sampling and simple random sampling was used to select individuals who had direct

involvement with the reward system. These included senior HR officers and departmental heads.

These Individuals were chosen because they possessed in depth knowledge and provided detailed

information that was critical to the study.

17
On the other hand, simple random sampling was used to select participants from the rest of the

employees. This method ensured that each employee had an equal chance of being selected,

reducing biasness and promoting fairness. Use of both techniques allowed researcher gather both

wide and specialized perspectives, which improved accuracy of the findings.

Table 2: Sampling

Level of management Frequency Percentage

Top level 3 6%

Middle level 5 10%

Lower level 42 84%

Total 50 100%

Source: Author’s field data

3.4 Instruments of Data Collection

In the study, data was collected through questionnaires and interviews. Both instruments were

designed to gather extensive information about the effects of reward system on employee

performance at the Kitui County Public Service.

Questionnaires were used as the main instruments of data collection in the study. According to

(Kothari,2004), a questionnaire is a method of data collection. This tool allowed the researcher to

collect responses from larger group of respondents quickly and systematically. The

18
questionnaires included close ended questions because they were easier to answer which lead to

higher response rate. The closed ended questions helped researcher quantify aspects of reward

system that influenced employee performance. The questionnaire was designed simple and clear

which encouraged participation and ensured high response rates. The questionnaire was

distributed to sample of employees randomly and was administered during working hours.

Interviews were used to collective qualitative data from the top officials like HR officers,

supervisors and departmental heads. Interviews were semi structured, allowing researcher ask

specific questions and also allowed room for in depth discussions. The goal of interview was to

gain an understanding of perspectives of individuals who were involved in designing and

implementing reward system.

3.5 Validity of the instrument

(Mugenda&Mugenda,2003) noted that validity is referred to the degree to which results obtained

from analysis of the data actually represent the phenomenon under study. The validity of research

instrument was realized by scrutinizing questionnaire items during their construction. All

questions were aligned with research objective.

3.6 Data Collection Procedure

The researcher got an introductory letter from the school Wote Technical Training Institute. This

document was presented to Kitui County Public Service Board to enable data collection from its

employees. The researcher first sought authorization from relevant authorities including the

County Public Service Board. After a week the actual data collection was conducted.

Questionnaires were distributed to the sample respondents The research was conducted at the

19
convenience of the respondents. Anonymity and confidentiality were assured to all respondents

to encourage ho1nest responses. Researcher afterwards collected the questionnaires back.

3.7 Method for data analysis

According to (Bryman and Gramr,1997), data analysis seeks to fulfill research objectives and

provide answers to research questions. The collected data was first sorted for completeness,

reliability and consistency which was done through analysis of internal reliability and internal

consistency. This involved physical sorting of the returned questionnaires to determine

consistency margin and discarding those not falling within the margins.

Descriptive statistics such as percentages, means and frequencies were used to analyze

quantitative data. Charts and tables were used for visual presentation. Qualitative responses were

analyzed using content analysis to supplement quantitative findings.

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 CHAPTER FOUR

FINDINGS, DATA ANALYSIS, CONCLUSION AND RECOMMENDATION

The chapter was devoted to presentation analysis, interpretation and discussion of data collected

from respondents on the effects of an efficient reward system on employee performance in the

Kitui County Public Service Board. The aim of the chapter is to interpret raw data collected from

the field using appropriate statistical tools and relate findings to the research objectives and

questions.

The data was collected from sample of 50 respondents using structured questionnaires and

scheduled interviews. The responses were classified, coded and analyzed using descriptive

statistics which included percentages, frequencies, tables and charts. The presentation was

organized according to research objectives for clarity and easy interpretation.

In this chapter, the findings were presented in five main sections; data presentation, data analysis,

interpretation of results, discussions of findings, summary.

This structure approach enabled researcher draw accurate conclusions and offer

recommendations.

4.1 Data Presentation.

The section focused on actual data obtained from the respondent. Raw data was converted into

meaningful statistics to provide insight into research problem. Analysis was aligned with specific

objectives of the study. Data was presented using tables, pie charts, bar charts to enhance clarity

and interpretation. Each visual aid was followed by descriptive explanation of patterns and trends

observed.

21
Table 3:Demographic information

Gender Frequency Percentage

Male 27 54%

Female 23 46%

Total 50 100%

Source: Author’s field data

The table indicates that 54%of respondents were male while 46% were female. This suggest

slightly higher male participation in the public service sector within Kitui County.

Gender distribution

46% Male

54% Female

Figure 2:Gender Distribution

22
4.1.2 Age distribution of respondents

Table 4:Age of respondents

Age Bracket Frequency Percentage

18‑25years 6 12%

25 ‑35 years 12 24%

36 ‑45 years 23 46%

46‑ 55 years 8 16%

Above 55 years 1 2%

Total 50 100%

Source: Author’s field data

Majority of respondents 46% were aged between 26‑35 years, indicating that public Service

Board is dominated by young and middle aged individuals who are more dynamic and open to

performance incentive.

23
 Age of respondents
50% 46%

40%
frequency

30% 24%
20% 16%
12%
10%
2%
0%
18-25 25-35 36-45 46-55 above 55 yrs
Age brackets

age of respondents

Figure 3:Age of respondents

4.1.3 Level of education

Table 5:Educational qualification

Education level Frequency Percentage

Other 3 6%

Certificate 5 10%

Diploma 9 18%

Degree 22 44%

Masters 8 16%

24
PhD 3 6%

Total 50 100%

Source: Author’s field data

Most respondents 44% held bachelor’s degree, suggesting well educated workforce. Higher

education levels may influence how employees perceive and respond to reward systems.

Education level

PhD 6%

Masters 16%
level of education

Degree 44%

Diploma 18%

certificate 10%

Other 6%

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

Frequency

Figure 4:Education level

25
4.1.4 Job level

Table 6:Level of job

Level of management Frequency Percentage

Senior level 2 4%

Middle level 12 24%

Junior 36 72%

Total 50 100%

Source: Author’s field data

Objective 1: To examine existing reward system in KCPSB

4.1.5 Employee perception on existing reward system

Table 7:Perception of employees

Reward element Strongly Agree Neutral Disagree Strongly Total

agree disagree

Reward system is fair 5 10 8 15 12 50

Rewards improve 7 13 6 14 10 50
motivation

26
Rewards increase job 6 15 4 13 12 50
satisfaction

Source: Author’s field data

The table shows that only 15 respondents (30%)agreed that the reward system is fair, while 27

respondents (54%) disagreed or strongly disagreed. Similarly, only 20 respondents (40%) agreed

that rewards improve motivation, while 24(48%)disagreed. On job satisfaction,21 respondents

(42%)agreed that rewards increased satisfaction, whereas 25(50%) disagreed. These results

suggest that significant number of employees perceive the current reward system as unfair and

ineffective, which may lead to reduced motivation and job satisfaction.

employee perception
35%
30% 30%
30% 28%
26% 26%
24% 24%
25%
20% 20%
Frequency

20%
16%
14%
15% 12% 12%
10%
10% 8%

5%

0%
fairness motivation job satisfaction
Reward element

Strongly agree Agree Neutral Disagree Strongly disagree

Figure 5:Employee perception

27
Objective 2: To assess monetary and non-monetary rewards

4.1.6 Effectiveness of monetary and non-monetary rewards

Table 8:Effectiveness of rewards

Type of Very Effective Neutral Less Not Total

reward effective effective effective

Salary 15 18 5 7 5 50

Bonuses 12 20 3 10 5 50

Recognition 10 21 6 7 6 50

Promotion 13 17 4 9 7 50

opportunities

Training and 11 19 5 8 7 50

development

Source: Author’s field data

From the table, salary was rated as very effective or effective by 33 respondents (66%), bonuses

by 32 (64%), recognition by 31 (62%), promotion opportunities by 30 (60%).Although the

majority found these rewards effective, a notable portion of respondents were either neutral or

found them less effective. This mixed response implies that while reward strategies are in place,

28
they may not be equally valued by all employees, pointing to a need for customization and

improvement in implementation.

Types of reward
45% 42%
40%
40% 38%
36%
34%
35%
30%
30% 26%
24%
25% 22%
Frequency 20% 20%
20% 18%
16%
14% 14% 14% 14%
15% 12% 12%
10% 10% 10% 10%
10% 8%
6%
5%
0%
salary Bonuses Recognition Promotion Training
opportunities &development
Type of reward

Very effective Effective Neutral Less effective Not effective

Figure 6:Types of rewards

Objective 3: To analyze challenges in implementing reward system

4.1.7 Challenges in implementing reward system

Table 9:Challenges in implementation

Challenge Frequency Percentage

Budget limitation 18 36%

29
Lack of clear reward policy 12 24%

Delayed promotion 8 16%

Favoritism and bias 7 14%

Inadequate training on system 5 10%

Total 50 100%

Source: Author’s field data

The most common challenge identified was budget limitation (36%), followed by a lack of clear

reward policy (24%), delayed promotion (16%).favoritism (14%) and inadequate training (10%).

These findings suggest that both structural and administrative barriers are hindering the

efficiency of the reward system. Inadequate financial resources, lack of clear policy and

perceived unfairness contribute to a system that is not fully trusted or embraced by employees.

30
 Challenges in implementation

10%

14% 36% Budget limitation

Lack of clear reward policy
Delayed promotion
Favoritism &bias
16% Inadequate training

24%

Figure 7:Challenges in implementation of reward system

Objective 4: To recommend strategies for improvement

4.1.8 Strategies for improving reward system

Table 10:Suggestions

Suggested strategy Frequency Percentage

Introduce performance based 14 28%

rewards

Increase transparency in 12 24%

31
reward collection

Regular salary reviews 10 20%

Provide more training and 8 16%

development

Automate reward tracking 6 12%

and feedback

Total 50 100

Source: Author’s field data

The suggestions provided by employees reflect a desire to reform and improve. The most

proposed strategy was introducing performance based rewards (28%), followed by increased

transparency (24%), regular salary reviews (20%), more training and development (16%) and

automating the reward tracking system (12%). These recommendations align with modern HR

practices, indicating that employees are aware of the changes needed to enhance motivation,

fairness and organizational productivity

32
 Strategies for improvement
30% 28%

25%
24%
20%
20%
16%
Frequency

15%
12%
10%

5%

0%
Introduce Increase Regular salary Provide more Automate reward
performance based transparency in reviews training and tracking and
rewards reward collection development feedback
Suggested strategy

Figure 8:Strategies for improvement of reward system

4.3 Interpretation of data

The data collected from respondents provided insights into how employees perceive the reward

system and its impact on their performance. A majority of the respondents acknowledged the

existence of a reward system in KCPSB but expressed mixed feelings regarding its fairness and

effectiveness.

Demographic data showed that most respondents were middle-aged and highly educated,

indicating a knowledgeable workforce capable of evaluating reward policies critically. This

demographic also suggested that employees had diverse expectations based on their career levels

and life stages.

33
Perception of fairness: Only 30% of employees believed that the reward system was fair, while

the remaining 70% were either neutral or disagreed. This indicated a perception gap that could

lead to decreased motivation and potential dissatisfaction if not addressed.

Effectiveness of rewards: Both monetary and non-monetary rewards were viewed as somewhat

effective, with 66% of respondents stating that salary and bonuses motivated them to perform

better. Non-monetary rewards like recognition, promotion, and training were also seen as

contributors to job satisfaction and professional growth. This supports the need for a balanced

reward strategy combining financial and non-financial elements.

Challenges: Budget constraints (36%) and lack of clear policy (24%) were the most reported

barriers to an efficient reward system. These issues hinder the consistency and transparency of

reward implementation, leading to mistrust and demotivation among staff.

Suggestions for improvement: Respondents recommended strategies like performance-based

rewards, regular salary reviews, and enhanced transparency. These proposals align with best HR

practices and indicate that employees are aware of the steps needed to improve motivation and

performance. In conclusion, the interpretation reveals that while a reward system exists at

KCPSB, it requires significant improvement in fairness, communication, and implementation to

effectively influence employee performance.

4.4 Discussion of findings

Findings are in agreement with several motivational theories and previous empirical studies.

Comparison with Herzberg’s two factor theory

34
Herzberg proposed that motivators like achievement, recognition enhance job satisfaction while

hygiene factors like salary, company policies prevent dissatisfaction. In this study, both

categories were shown to be necessary. Employees desired both fair pay and recognition, which

confirms Herzberg’s assertion that rewards must be balanced to sustain.

Comparison with Maslow’s Hierarchy of needs

Maslow’s theory suggest that people are motivated to fulfill needs in a specific order from

psychological to self-actualization. The study revealed that:

 Monetary rewards addressed basic needs (food, shelter)

 Job security and benefit addressed safety needs

 Recognition and team support addressed esteem and belonging needs

 Training and promotions contributed to self-actualization.

This alignment confirms that a well-structured reward system supports all levels of employee

needs.

Comparison with empirical studies

Previous research by (Armstrong,2012) also demonstrated that reward systems significantly

influence employee output and retention. The results from Kitui County Public Service Board

showed similar patterns, where satisfied employees demonstrated greater engagement, while

unsatisfied ones lacked motivation.

35
The findings of this study were consistent with both theory and practical experiences elsewhere,

reinforcing the idea that reward system must be strategic, timely and fair to produce meaningful

performance outcomes.

4.5 Summary

The study sought to examine effects of an efficient reward system on employee performance,

focusing on Kitui County Public Service Board. The study adopted descriptive research design.

Data was collected using structured questionnaires and analyzed through descriptive statistics

including frequencies, percentages, tables and charts. respondents included public service staff

from various departments within Kitui County.

Findings revealed that both monetary and non-monetary rewards play a significant role in

influencing employee behavior and performance. Monetary rewards such as salaries, bonuses

were found to be essential in motivating employees to meet targets and maintain productivity. On

monetary rewards such as recognition, promotion and career development were also

acknowledged as contributors to job satisfaction and long term commitment.

The study found that an efficient reward system defined by fairness, transparency, timeliness and

relevance to employee needs has strong correlation with employee morale, job satisfaction and

overall performance.

36
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40
 APPENDIX

RESEARCH QUESTIONNAIRE

EFFECTS OF EFFICIENT REWARD SYSTEM ON EMPLOYEE PERFORMANCE: A CASE

OF KITUI COUNTY PUBLIC SERVICE BOARD.

The questionnaires are used for study purposes. The respondents to this questionnaire have been

selected randomly and the responses given will be treated with utmost confidentiality. Do not

write your name. Please answer honestly.

PART A: BIO DATA (Tick where appropriate)

1. Gender

Male Female

2. Age

below 25 years 25‑35 years

36 ‑45 years 46 ‑55 years

Above 55 years

3. Education level

certificate Diploma

Bachelor’s degree Postgraduate degree

Other (specify)

41
 4. Current position ………………………………….........

5. Length of service in the public service

less than I year 1 ‑5 years

6 ‑10 years 10 years

PART B: Existing reward system at KCPSB

1. What types of rewards are available at KCPSB? (Tick all that apply)

Basic salary bonuses

Paid leave recognition and awards

Training&development promotions

Health insurance other: …………………..

2. How satisfied are you with the current reward system at KCPSB?

Very satisfied satisfied

Neutral dissatisfied

Very dissatisfied

3. In your opinion, how transparent is the reward system?

very transparent transparent

Neutral Not transparent

Not sure

42
PART C: Impact of monetary and non-monetary rewards on performance

1. What motivates you more at work?

Monetary rewards non-monetary rewards

Both equally

2. Rate your agreement with the following statements

Statement Strongly Agree Neutral Disagree Strongly

agree disagree

Bonuses and allowances

improve my performance

Training and development

increase my motivation

Promotion opportunities lead

to higher productivity

Non-financial recognition

makes me feel valued

PART D: Challenges in implementing reward systems

1. Have you faced any challenges with the reward system at KCPSB?

Yes No

2. What challenges are common in reward system implementation? (Tick all that

apply)

43
 lack of transparency budget constraints

bias in promotions poor communication

inconsistent reward criteria other ………………….

PART D: Suggestions for improvement

1. What strategies would you recommend to improve reward system at KCPSB?

..................................................................................................................................

……………………………………………………………………………………..

…………………………………………………………………………………….

2. In your opinion, how can the reward system better support employee performance and

public service delivery?

…………………………………………………………………………………….

…………………………………………………………………………………….

……………………………………………………………………………………

Thanks for participation

44