The Impact of Compensation Strategy on Organisational Performance

ABSTRACT Compensation is an integral part of human resource management which helps in motivating the employees and improving organizational effectiveness. Thus, the study examines the impact of compensation strategy on orgaanisational performance of non-academic staff of Federal Polytechnic, Ede, Osun state. The main research instrument used for the study was questionnaire. Survey research design was employed. The population of the study comprised of 367 employees of the institution, while a sample size of 188 was derived using Dilmans’ formula but 179 was returned and used for analysis. The reliability for the questionnaire showed a Cronbach Alpha value above 0.8 for all the constructs. Simple regression and Multiple regression analysis was used to test the hypotheses with the aid of SPSS version 23 software. The study found that: employee recognition has a significant impact on organisational performance (Coef. = 0.867, t = 24.485, p = 0.000). staff leave have significant influence on organisational performance (Coef. = 0.802, t = 20.427, p = 0.000). competitive salary have significant effect on organisational performance. (Coef. = 1.358, t = 17.098, p = 0.000), retirement benefits have significance influence on organisaional performance (Coef. = 0.903, t = 33.068, p = 0.000). An overall compensation strategies has a significant effect on organisational performance in the school (p = 0.000). The study concluded that compensation strategies (employee recognition, staff leave, competitive salary and retirement benefits) has a has joint effect on organisational performance. The study recommended that the school needs to improvise compensation strategies for jobs well done, this will motivate employees thus enhancing employee and organisational performance.