EMPLOYEE ENGAGEMENTAND PERFORMANCE OF DEPOSIT- TAKING SACCOs IN NAIROBI, KENYA

Abstract

Many organizations recognize the importance of cultivating a focused and highly engaged workforce. Employee engagement and organizational performance has been a topic of interest for both scholars and human resource practitioners over the previous 20 years with diverse findings; but still limited comprehensive studies have been conducted to offer an outline on the impact employee engagement on deposit-taking Saccos performance. The main objective of the enquiry was to determine the effect of employee engagement and performance of deposit-taking Saccos in Nairobi, Kenya. The specific objectives of the investigation were to explore the influence of employee vigor on organizational performance; to evaluate the effect of employee consultation on organizational performance; to assess the effect of employee’s absorption on organizational performance; to assess the effect of employee dedication on organizational performance and to analyze the effect of human resource management practices on the associations amid employee engagement and organizational performance. The research was anchored on Personal Engagement Theory as the main theory and Social Exchange Theory as the supplementary theory. The enquiry applied a cross-sectional design through a census technique of forty-six (46) deposit-taking Saccos in Nairobi. The respondents were the Human Resource Managers of the selected deposit-taking Sacco’s that gave data completed in a structured questionnaire. Reliability of the concepts was tested using Cronbach alpha analysis while validity was tested using average variance extracted in a pilot study of three (3) deposit-taking Saccos in Western Kenya. The data was analyzed using descriptive and inferential analysis. The correlation coefficient amongst employee vigor and organizational performance (r= 0.303; P-value = 0.076>0.05), which show that the associations among the two concepts is not statistically noteworthy. The regression results indicate that employee consultations (R2 - 0.575; t=6.680; P-value=0.000 < 0.05), employee dedication (R2 - 0.394; t =4.629; P-value=0.000 < 0.05) and employee absorption (R2 - 0.282; t=3.602; P-value=0.001< 0.05) had a significant linkage with organizational performance. In addition, human resource management practices (R2 = 0.752; P=0.001 < 0.05) had a significant effect on the connection amongst employee engagement and performance of DT-Saccos in Nairobi, Kenya. However, employee vigor (R2 - 0.092; t =1.829; P-value=0.076 > 0.05) did not have a significant influence on organizational performance. This research presents a fresh perspective and understanding of the relationship between employee engagement and organizational performance by focusing specifically on deposit- taking saccos in Nairobi, Kenya context. The study recommends that DT - Saccos should critically address and put more resources towards HRM practices that improve employee engagement as it highly influences organizational performance. The scholar suggests that future study should incorporate additional control variables and use a mixed approach of quantitative and qualitative techniques to validate the results.