The Role of Compensation on Job Satisfaction, Employee Performance and Organisational Performance

Abstract

Present research looked at the role of compensation on job satisfaction, employee performance and organisational performance. The study was underpinned through social-exchange theory. Further, research used quantitative approach through which gathering data employed questionnaires. Descriptive research design was adopted. Research used one of Tanzania’s public organisations as a case study. The study opted to collect data from all the employees (107) of the organization hence sampling was not done. Out of 107 respondents, data were collected from 85 respondents which accounts for a response rate of 82.5%. Collected data were analyzed through descriptive and inferential statistics. Descriptive outcomes involved frequencies, means and standard deviations while those from inferential statistics were correlations and regressions. The study found compensation has significant positive influence on job satisfaction (β=.790, P-value=.000), employee performance (β=.429, P-value=.000), and organisational performance (β=.551, P-value=.000. The study calls for organisations to design and use effective compensation polices, strategies and practices to create supportive environment for employees to attain job satisfaction, employee performance and organisational performance as well.