St. Mary’s University
School of Graduate Studies
MA in Business Administration
HUMAN RESOURCE MANAGEMENT
MBA - 511
The effect of benefits package on employees’ performance at Ethio Telecom Bole Branch
Table of contents
1. Introduction 3
1.1 Background of the study 3
1.2 Objective of the Study 3
1.3 Background of Ethio Telecom 3
1.4 Methodology 5
2. Literature review 5
2.1 Compensation (Employee benefits) 5
2.2 Direct compensation 6
2.3 Reward and Incentives 6
2.4 Indirect/Fringe benefits 7
2.5 Employee benefits and performance 7
3. Data analysis and ...view middle of the document...
Employees’ performance and willingness to stay on the job largely depends on compensation packages of the organization. In an attempt to ensure employees optimal performance and retention, organizations need to consider a variety of appropriate ways to reward the employees to get the desired results. It has been argued that the degree to which employees are satisfied with their jobs and their readiness to remain in an organization is a function of compensation package system of the organization.
Compensation is output and the benefit that employees receive in the form of pay, wages and also some rewards for the employees to increase the performance. Compensation is the segment of transition between the employee and the owner. Compensation is the payment received for the work done. As employer, it is one of the most important part of cash flow. Compensation is mostly equal to half of cash flow of a company. But, in the service sector, it is more than half. It is the major factor to attract the employee and motivate them to increase their performance.
Different organizations objectives are to make their benefits and compensation packages to be attractive and build their employee performance, retain employees and achieve the organization’s stated goals.
1.2 Objective of the study
The objective of the study is to assess the effect of benefits package on employees’ performance at Ethio Telecom. The specific objectives are to identify what kinds of direct and indirect benefits employees receive at Ethio Telecom, to find out the perception of the employees towards the benefits package and assess the impact of the compensation package on employees’ performance.
1.3 Background of Ethio Telecom
The Ethiopia Telecommunications Corporation (ETC) was originally established in 1952, and since that time has been Ethiopia’s sole telecommunications provider. In 2006, ETC took a major step towards modernizing its outdated infrastructure, signing contracts worth US$2.4 billion with three major Chinese companies—ZTE, Huawei, and China International Telecom Corporation (CITCC)—to rapidly develop the country’s telecommunications infrastructure.As a result, these companies have played a large role in laying Ethiopia’s main fiber optic communications network.Prior to this time, Ethiopia’s telecom infrastructure had been developed in an ad hoc manner by a number of foreign companies.
In addition, in 2006, ZTE signed a three-year, $1.6 billion deal to become ETC’s sole equipment vendor for nine equipment packages. The exact category of equipment sold under the deal is unclear, but ZTE was tasked with a major upgrade and expansion of both fixed line and mobile infrastructure and services. ZTE sells a range of telecommunications equipment, software, and services, including network switches, mobile handsets, and software systems. As Zhang Yanmeng, chief executive officer of ZTE’s Ethiopia subsidiary stated in 2009, “This is the world’s only project in which...