JIGDAN COLLEGE

DISTANCE EDUCARTION
DEPARTMENT OF MANAGEMENT

THE EFFECT OF EMPLOYEE MOTIVATION ON

ORGANIZATION PERFORMANCE
(In Case of Commercial Bank of Ethiopia in
Merawi Branch in Merawi Town)

THE RESEARCH PAPER SUBMITTED IN PARTIAL

FULFILLMENT OF THE REQUIREMENT BA DEGREE IN
MANAGEMENT

PREPARED
BY:

YITAKTU BELAY FELEKE

I.D NUMBER:

APRIL, 2023
JIGDAN COLLEGE
Merawi
 JIGDAN COLLEGE

As a member of examining board of the final senior essay presentation /defense/ we

certify that we have heard and evaluated this paper prepared by Yitaktu Belay Entitled
“THE EFFECT OF EMPLOYEE MOTIVATION ON ORGANIZATION
PERFORMANCE (In Case of Commercial Bank of Ethiopia in Merawi Branch in
Merawi town)’’ recommended that it be accepted as the partial fulfillment of the
requirements for the BA degree in Management.

Examiners Signatures

________________________
__________________
Department Head

________________________ __________________
Examiner (1)
____________________
__________________
Examiner (2)

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 Declaration
I, the under signed, declare that this senior essay /project / is my original work
prepared under the guidance of my friends. All the sources of materials used
for the manuscript have been duly acknowledged.

Name: - Yitaktu Belay Feleke

ID Number: -
Center: - Merawi Signature _________Submission Date ______

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 Acknowledgement
First and for most I would like to thanks God, because he has helped me in every aspect
of my life. Next to that I would like to express my sincere gratitude to my brother for his
advice and comment in all of my paper.

Finally, I would like to express my deeply heart thanks to those who had not been
mentioned their name but contribute a lot to this achievement.

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 Abstract
The main objective of this study is to identify the effect of employee’s motivation on
organization performance in case of commercial bank of Ethiopia Merawi branch in
Merawi town. The relevant data for this study collected from both primary and secondary
sources. To collect primary data self-administered questionnaire is used whereas,
secondary data collected by organizational records and written materials about the
organization. Simple random sampling is used to collect data from employees because of
they were large in numbers. The collected data is effectively processed, analyzed and
presented by using percentage and tabulating. Based on the analysis of fact and findings,
the followings are recommended to upgrade employee’s motivation that has positive
impact on productivity of the organization.

The bank should practice the system of increasing the scale of salary and rewards for
those whose productivity is better than others.

The management of the organization should be approachable and listen the comment of
employees regarding motivation problems in the organization to increase the performance
of the organization.

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 Table of Contents

Content Page

DECLARATION...............................................................................................................II
ACKNOWLEDGEMENT..............................................................................................III
ABSTRACT.....................................................................................................................IV
TABLE OF CONTENTS..................................................................................................V
LIST OF TABLE............................................................................................................VII
CHAPTER ONE................................................................................................................1
1. INTRODUCTION.........................................................................................................1
1.1 BACKGROUND OF THE STUDY....................................................................................1
1.2 BACK GROUND OF THE ORGANIZATION......................................................................1
1.3 STATEMENT OF PROBLEM...........................................................................................3
1.4 OBJECTIVES OF THE STUDY........................................................................................4
1.4.1 General objective................................................................................................4
1.4.2 Specific objective................................................................................................4
1.5 SIGNIFICANCE OF THE STUDY.....................................................................................4
1.6 SCOPE OF THE STUDY.................................................................................................5
1.7 LIMITATION OF THE STUDY.........................................................................................5
CHAPTER TWO...............................................................................................................6
2. REVIEW OF RELATED LITERATURE..................................................................6
2.1 MOTIVATION...............................................................................................................6
2.2 HOW TO MOTIVATE EMPLOYEES.................................................................................6
2.3 CHALLENGES OF MOTIVATION...................................................................................7
2.4 IMPORTANCE OF MOTIVATION.....................................................................................7
2.5 SOURCE OF MOTIVATION............................................................................................7
2.6 THEORIES OF MOTIVATION.........................................................................................8
2.6.1 Maslow theory....................................................................................................8
2.6.2 Alderperson ERG theory.....................................................................................9
2.6.3 McClelland’s Theory..........................................................................................9
2.6.4 Motivation, Performance and Job satisfaction..................................................10
2.6.5 Consequence of Job dissociation......................................................................10
CHAPTER THREE.........................................................................................................16
3.MATERIALS AND RESEARCH METHODOLOGY..............................................16

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 3.1 STUDY AREA.............................................................................................................16
3.2 TYPES AND SOURCES OF DATA.................................................................................16
3.3 METHODS OF DATA COLLECTION.............................................................................16
3.4 METHOD OF DATA ANALYSIS...................................................................................17
CHAPTER FOUR...........................................................................................................18
4. DATA ANALYSIS AND INTERPRETATION......................................................18
4.1. GENERAL EMPLOYEES BACKGROUND.....................................................................18
4.2. MOTIVATIONAL PRACTICE.......................................................................................19
4.3. MOTIVATIONAL IMPACT...........................................................................................20
4.4. ADDITIONAL REWARD SYSTEM................................................................................20
4.5. SECURITY OF JOB....................................................................................................21
4.6. PUNCTUALITY OF EMPLOYEES.................................................................................21
4.7. STAYING IN ORGANIZATION.....................................................................................22
4.8. EFFECT OF MOTIVATION...........................................................................................23
4.9. EFFECT OF ABSENTEEISM........................................................................................23
4.10. FAIRNESS OF REWARD...........................................................................................24
CHAPTER FIVE.............................................................................................................25
5. CONCLUSION AND RECOMMENDATION.........................................................25
5.1 CONCLUSION............................................................................................................25
5.2. RECOMMENDATION.................................................................................................26
REFERENCE...................................................................................................................27
APPENDIX.......................................................................................................................28

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 List of table

Tables Page
TABLE 4.1 AGE, SEX, EDUCATIONAL LEVEL AND MARTIAL TUTUS OF RESPONDENTS
TABLE 4. 2. RESPONSE ON MOTIVATIONAL PRACTICE IN ORGANIZATION
TABLE 4. 3, RESPONSE ABOUT MOTIVATIONAL IMPACT ON PRODUCTIVELY
TABLE 4.4. RESPONSE ABOUT ADDITIONAL REWARD SYSTEM
TABLE 4. 5. RESPONSE ON SECURITY OF JOB
TABLE 4.6 RESPONSE ABOUT PUNCTUALITY OF EMPLOYEES
TABLE 4. 7. RESPONSE ON STAYING IN ORGANIZATION
TABLE 4.8 RESPONSE ABOUT EFFECT OF MOTIVATION
TABLE 4.9. RESPONSE ON ABSENTEEISM OF EMPLOYEES
TABLE 4.10. RESPONSE ON WHO FAIRLY REWARDED IN THE ORGANIZATION

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 CHAPTER ONE

1. Introduction
1.1 Background of the study
The success of any business depends largely on the motivation of the employees. Human
resources are essential to prosperity, productivity and performance of any company.
Motivation is the key to creating an environment where the optimal performance is
possible. The practice of motivational factors require from an employer determines the
performance of employees and the success and failure of the organization. The
relationship between the performance and motivation clearly shows that manager should
hire individual who have the ability to do what is requires. According to (Hucznsky 2001,
p: 321).
The development and growth of business organization in competitive business
environment is depends on the efficient utilization of resource. The performance of
organization is affected by different factors such as motivation, working condition, and
job security. Taking this in to account motivating employees helps organization to get
competitive advantage. No doubt that the survival of an organization largely depends on
effective and efficient management of its resource. Human resource is one of these that
need to be well managed. It plays a crucial role in achieving both the long- run and short-
run objectives of an organization. Managing people is not as easy as managing resource.
This is due to the complex nature of human being and as a result in as single organization
different people may have different personalities, attitudes, beliefs and values. Managers
must use different strategies and skills to wards motivating employee for the survival and
best performance of organization.

1.2 Back ground of the organization

The agreement that was reached in 1905 between emperor Minilik II and Mr.,
Magillivray, representative of the British owned national bank of Egypt marked the
introduction of modern banking in Ethiopia.

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Following the agreement, the first bank called Bank of Abyssinia was in gurated in
February 16, 1906 by the emperor and the bank was totally managed by the Egyptian
National bank. By 1931, Bank of Abyssinia was legally replaced by Bank of Ethiopia
shortly after emperor Haile Selassie came to power.

The new bank, Bank of Ethiopia, was purely Ethiopian institution and east the first
indigenous bank in Africa and established by official decree on August 29, 1931 with a
capital of Birr 750,000 (http:en, Wikipedia, org/wiki/ commercial bank of Ethiopia)

The first indigenous bank which functions as both as commercial bank and central bank
was established in 1963, under the name of state of Ethiopia. In 1963, new banking law
split the state bank of Ethiopia to central and commercial banking namely national bank
of Ethiopia (NBE) and commercial bank of Ethiopia (CBE). The former was responsible
for supervision of banks in the country. The national bank of Ethiopia with more power
and duties started its operation in January 1, 1964.

Following the incorporation as a share company on December 16, 1963 as per percolation
No, 207/1997s o October 1963 took over the commercial bank activates of the former
state bank of Ethiopia. It started operation on January 1,1964 with a capital of birr 22
million in the new commercial bank of Ethiopia, in contrast , with the former state bank
of Ethiopia, all employees where Ethiopians (http://www.teh history of corporate, com)
Consequently, the present day commercial bank of Ethiopia was established under
proclamation No, 184 of August 1980.
According to this proclamation the main objectives of the commercial bank of Ethiopia
are as follows:
1. To extend commercial banking services throughout the country
2. To extend loans, credits and all other banking facilities to any person for specific
purpose and periods.
3. To encourage the mobilization of saving by making the people aware of the use of
banking.
4. To spread widely banking habits among the people.

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Moreover, according to this proclamation, the bank shall have the responsibility to
perform the following duties in accordance with the general directives issued to it by the
supervising authority, namely the national bank of Ethiopian.
1. Receive saving demand and time deposits
2. Make loans and advances
3. Draw, accept, discount, buy and sell bill of exchange, drafts, and promissory notes
payable within or outside Ethiopia.
4. Issue letter of credit.
5. Buy, sell, hold or other wise deal in foreign exchange,
6. Control the end use of credit loans, and other facilities that provide to its
customers.
7. Act as an agent for persons and in this capacity, engage in the sale of money and
shares.
8. Negotiate, under write or issue bond
9. Keeping safes securities, jewelry, precious metal and other valuables materials.
10. Issue cheques and travelers cheques and generally deal with cheques.
11. Hold, acquire and sell negotiable instrument and security by the government or
private person.
12. Acquires, poses, mortgage sell, exchange and dispose of property for the purpose
of attaining its objectives and proper functioning its operations.
13. Performs such other banking activities as are customarily carried out by
commercial bank.

1.3 Statement of problem

Employee motivational programs go a long way towards ensuring employees feel
appreciates and bad. This alone can help with employee’s motivation across the board.
The great thing about this program is they are very individualized. Motivational program
increase motivation because they are not only encouraging productivity performance but
also show employees the company cares. (Hucznsky, 2001).

Motivates employees are happy on behave of the job and strive for increasing
productivity of the business. They also try to develop a new mechanism of doing a job so

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as to improve their productivity. In contract to this, poor motivation leads to eradicate the
productivity of the organization by a means of unpunctual and absenteeism. (Bernard.et
al, 2002)
The study focus on the motivational tools that management generally uses to employees.
motivation are financial and non-financial motivational. Financial motivation include like
reward, piece rate wage and the non-financial motivation also include motivation status,
responsibility, making job pleasant and interesting.
The poor performance of employees is decrease the productivity and employee lay off
from work.
Dissatisfaction of the employee lead to turn over which has adverse effect on
organization performance. Then the organization should satisfy those who were
dissatisfied.
The basic question of this research was
1) Does CBE in Merawi branch motivate its employees?
2) What methods does the organization use to motivate its employees?
3) What types of impact employees’ motivation impose on performance?
4) What are the problems relates to motivation in the organizations?

1.4 Objectives of the study

1.4.1 General objective
The general objective of this research is to find out the effect of employees motivation on
the performance of the organization.

1.4.2 Specific objective

The specific objectives of this study are:
 To identify what methods to uses in order to motivate employees of the
organization.
 To identify what type of impact employees motivation impose on productivity.
 To identify the problem relates to motivation in the organization

1.5 Significance of the study

The study has the following importance for concerned stakeholders. The study enables
the organization to know their strength and weakness and then to follow the way to

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motivate and increase their productivity in easy way. The study also provide relevant
information to this on varies level of management, employees and labor union leads to
understand the importance of motivational factors on performance of employee. Lastly, it
creates awareness to minimize the problem related to employee motivation.

1.6 Scope of the study

The scope of this study limited to the effect of employee motivation of performance in
case of commercial bank of Ethiopia in Merawi branch. Since studying the effects of all
factors on employees’ performance is unmanageable, the researcher tries to limit the
factors to salary and rewards, career development, participation and safety and healthy
work environment. The study is also limits to one company, CBE in Merawi branch due
to limits knowledge, skill and financial resource that the researcher has.

1.7 Limitation of the study

Conducting this study there was limitation that the researcher faces are under the
following.
 Data’s needed for analysis concerning motivation can be gained from primary
data, since most of the data are related to attitude of employees.
 Shortage of time for gathering all necessary data from the organization.
 Lack of financial resource is the major constraint.

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 CHAPTER TWO

2. Review of Related Literature

The employee motivation has major impact on economic performance of the firm. The
firm used different essential resource for its economic performance. Especially human
resource is most and significant and ingredient part of resource and managers apply a
variety of motivational scheme to give employees highly productive and always they
stand for a common good of firm. This chapter tries to present the theoretical aspects of
motivation. (staff@incentivequotes.com)

2.1 Motivation
There is no standard definition of motivation but there are number of common agreement.
Motivation has to do three broads are as with respect to individuals behavior. Source
(Anderson 1989. PP63).
1) Direction what someone is trying?
2) Persistence has along someone continual trying.
3) Effort how hard someone is trying
According to Bernard Berenson and Gram A. Steiner” motivation is an energized action
at channels behavior reward’s the goals”.

2.2 How to motivate employees

The successful managers have known how to motivate their employees. Even though
everyone is motivated by different needs, most people tell that two of most important
issues they look for the company are mutual respect and personal involvement. There are
some ways motivating employees are
 Be aware of moral level of your organization.
 Involve employees in decision making.
 Outline job responsibilities.

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2.3 Challenges of Motivation
Motivation in practice and theory are difficult issues conducting on several disciplines. In
spite of research basic as well as applied, the subject of motivation not clearly understood
more often than not poorly practiced. People in the organization come from different
places with respect to attitudes towards job peers, subordinates, organizational rules and
procedures. As a result of these mangers or organization encounter big problem of having
different outlook and at same goals and objective achieved by integrating and
coordinating people. Source (plunkent, 1997.PP390).

2.4 Importance of motivation

Motivation is important because of its determinants factors on performance and its
intangible character. The performance of individual’s is determined by
- Motivation ‘the desire to do the job
- Ability; the capability to do the job
- The work environment the goals, material and information. Motivation process
begins with needs as deficiency. Motivated employees are a tower of the company
and they will binges dramatically change in every activities of their performance
and they are more productive to be effective manager needs to understand what
motivates employees within the context of they perform.
- Source (Bowen and Radian Krishna, 9191 W.W.W. jo.oxgn).

2.5 Source of motivation

1. Positive motivation; involves proper recognition of employees effort and appreciation
of employees contribution towards organizational goals achievement. Some of these
are delegation of Authority and responsibility to subordinates participation indecision
making.
2. Negative motivation; is based up on use of force, power and treats. The fear of
punishment or unfavorable consequence affects the behavior change
3. Extrinsic motivation; is induced by external factors which are primarily financial in
nature.
4. Intrinsic motivation, it stems from feeling achievement and accomplishment and is
concerned with state of self-actualization in which the satisfaction of accomplishment

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 something worthwhile motivates the employees. It’s self-generated and independent
of financial rewards like recognition, responsibilities, esteem needs source (Chand an
1995. PP 57).

2.6 Theories of Motivation

This station presents various theories of motivation proposed by different individuals and
section.

2.6.1 Maslow theory

Maslow theory is a hierarchy need theory which is popular theories of motivation and it’s
based on the following facts.
 Man is not always satisfied with it on hand. He is always in need of something
which he does not have.
 Human needs are unlimited, that is if one need is satisfied the other need will be
activate and the process continuous in definitely. Maslow needs hierarchy,
source (Diver, 1994.PP14).
Maslow categorizes the need in to the following five.
A) The physiological needs; involves a need for basic thing like food, water, shelter and
sex, when this fundamentals needs are not meet no other higher level needs will act
as motivation. On another way, once primary needs satisfied, safety or security needs
are activities.
B) Safety needs; include protection from physical harm, economic disaster and
futuristic needs in that they represent a desire to ensure ability to physical need.
C) Social need; is need for belongingness and love that comes in to play only when
physical and safety need are reasonable secured.
D) Esteem needs; include self-respect and feeling of competency and the need for
recognition and administration in the eyes of other.
E) Self-actualization; The process of making actual persons perception of his/ her real
self. Aracely attained self-actualization impulse to become when one is capable of
becomes of Achieving ones full potential in the most creative self-motivated way
source ( Resenabaum, 1982 PP75).

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2.6.2 Alderperson ERG theory
The ERG need theory, developed by Clayton alderperson is a refinement of Maslow’s
need hierarchy, Instead of manioc’s five needs, ERG Theory condenses these five needs
in to three needs.
1. Existence needs- these needs are roughly compatibilities to the physiological and
safety needs of Maslow’s models are satisfied primarily by material incentives.
These include the need for shelter physical and safety from threats on people’s
existence and well-being.
2. Relatedness needs- these roughly correspond to social and esteem in Maslow’s
hierarchy. These needs are satisfied by personal relationship and social interaction
with others. It involves open communication and honest exchange of thought and
feelings with other organizational members.
3. Growth needs’. These are needs to develop and grow and reach the five potential
that person is capable of reaching. Their needs are fulfilled by strong personal
involvement in organization environment and look for new opportunities and
challenge. ERG different from Maslow’s in proposing that may be motivated by
more than one kind of needs at the time. While Maslow proposes that in the
hierarchy needs, a person will satisfy the lower level need before he moves up to the
next levels of needs and will say at the need until it is satisfied. ERG Theory
suggests that if the person is frustrated in satisfying his needs at a given level, he
will move back to the lower level needs. (Wright Patrice 1996, PP: 364- 366).

2.6.3 McClelland’s Theory

David McClelland’s theory and his associate John Atkinson proposed another important
Theory of motivation and achievement of motivation. According to theory organization
offers an opportunity to satisfy of at least three needs (Davis, 1989 PP: 104)
1) The need for achievement (n- Ach)
Achievement motivation is driven some people have to overcome challenges and
obstacles in the pursuit of goals. An individual with this drive wishes to develop and
grow up the ladders of success characteristics of Achievement oriented. Employees
are work harder when they perceives that they will receive personnel credit for their

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 efforts when there is only moderate risk of failure and when they receive specific
feedback about past performance.
2) Need for Affiliation
Affiliation motivation is a drive to relate to people on social basic. Affiliation oriented
people work better when they are complimented for their favorable attitudes and
cooperation. They receive inner satisfaction from being with friends and they want
the job freedom to develop those relation.
3) Need for Power
Power motivation is drive to influence people and change situation. Power motivated
people wish to create an impact on their organization and are willing to taking risks
to do so Once this power is obtained it may be uses either constructively or
destructively. Power motivated people make excellent managers if their drives are per
instructional power instead of personnel power.

2.6.4 Motivation, Performance and Job satisfaction

It has often been said that a happy employee is a productive and happy employee must be
satisfied with his job, Job. Satisfaction can be defined as the extent of positive feeling of
attitudes that individuals have towards their job feels, good about it and values his job
highest on other and serious job dissatisfaction results in stress and tension which is
usually the cause of a variety of physiological disorder (Chandara 1995. PP: 87).

2.6.5 Consequence of Job dissociation

Job dissatisfaction produces low mental among workers and low mental at workers.
Some of the indicators to low morale are: - Employees unrest, the workers may not attend
to his job properly, may be involved in a day a reaming, be forgetful or just may not care.
If this unrest affect a sufficient numbers of workers, they may take a collective action
such as go slows, worker stoppage sticks and other allied group actions.
- Absenteeism: job satisfaction is highly related to absenteeism. Studies have found
that less satisfaction employers are more likely to be absent from work due to
“Avoidable reason”. Management must be concerned with excessive absenteeism
for it disrupts production and business operation.

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 - Employee turnover: high turnover distributes normal operation and continuously
replacing the employee who leave is costly and both technical and economically
undesirable. Turn over may be voluntary which initiated by the employee and
may be due to Job dissatisfaction or other personal reason beyond management
control.
- EARLY retirement: These has been that employee who choose early retirement
tend to hold less positive attitudes, challenges and, work opportunities are less
likely to seek requirement than employees with lower levels jobs.

77 ways to motivate employees

No longer can leader hire workers and expects to get motivated individuals.
Educartionhow to motivate is now one of the most relevant and essential skills leaders
can possess in two days ever-changing work place. This guide provides some insight in to
human motivation by offering 77 practical suggestion for motivating works. Today,
leader usually must go beyond the day –to –day operation and “though decisions”.
Leaders in today’s society are expected to be social scientist and the great leaders of
today and tomorrow are those gifted individuals who have mastered the art of motivation.
The ability to understand people and to be able to tap in to their respective motives are
the skills that make difference in today’s society.
What separates exceptional leaders from ordinary leaders is the ability to inspire and
motivate employees. In recent studies, researcher at the university of Nebraske-Lincol
examined source of motivation of Nebraska workers in urban and rural settings. The
results have demonstrated that five unique source of motivation exist:
- Intrinsic process-motivated by fun
- Instrumental-motivated by reword
- Self-concept-external motivated by reputation
- Self-concept- internal motivated by challenge
- Goal internalization- motivated by cause or purpose
Each of the five sources requires different organizational and leadership characteristics to
tap in to them. Exceptional leaders will find ways to tap into each source. Those who tap

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into just one or two will motivate only a small percentage of their workers and be less
effective.

Motivating workers
This section includes a list of 43 ways to motivate workers by gapping in to each of the
five source of motivation; fun, rewards, reputation, challenge, and purpose
Fun
Some workers really want to enjoy the work they do. Many who enjoy activities they
participate in at work place look forward to the day each morning.
There are 10 things leaders can do to make the work place and the experience of workers
more enjoyable for workers:
A, Find out which task are each of your employee’s favorites.
B, Find ways to assign more of the tasks they enjoy and fewer of the once they do not
like to do
C, if you are a good joke teller, tell tots of them.
D, if you are not much of a joke taller, buys a joke book.
E, Plan societal event for your employees.
F, Make sure that every meeting has some scheduled fun time
H, Always start a meeting with something social
G, Do something interesting with the lunch room
I, Create a quote of the week
J, Sponsor a company bar becue.
There are 10 ways to motivate people motivate by rewords:
A, Create incentive laden pay scales (les output-lespay)
B, Create sale contest
C, Create clear work objective and goals.
D, Remind workers of what they will get for their efforts.
E, Create incentives attached to predetermined objectives and task.
F, Give special reward to top performers on a regular basis.
G, Offer extra holiday time for outstanding performers.
H, be fair, these workers will watch closely to see what the consequence are of very one’s
actions.

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I, Follow through on all of your promises.
J, Make sure that workers do not receive perks if they have not earned them.
Reputation
Eight ways to motivate persons who are motivated by reputation
A, Give workers a lots of feedback about the way they are performing.
B, Give PRAISE in front of other people
C, Criticize these individuals only in private (never of in front of others)
D, Tell your workers that you appreciate the work they do
E, Tell people they are important both to the business and to you
F, Ask workers if anything interesting happened to them this weekend.
G, Make sure that you give credit to everyone that contribute
H Put up pictures and biographies of all your employees in accentual place

Challenges
Six ways to motivate people motivate by challenges:
- Stay out of their way and let them do the work if they know how to do it.
- Assign tasks that requires their skills and talents
- Find ways to help them to continually develop their abilities.
- Avoid assigning mundane tasks to those workers.
- Give them a challenge, and then get out of their way.
- Give them autonomy to structure and perform their job as they see best.

Purpose
Nine ways to motivate people high in purpose or goal internalization are listed below.
- Communicate the purpose of the task being assigned.
- Make sure the company has vision and mission that it is pursuing.
- Communicate the organization’s vision and purpose and on daily basis.
- Refer to the purpose of organization and “why we exist” when outline strategies
and goals.
- Remind employees of who depends on this organization to succeed.
- Discuss why (in terms of contributing to the mission) things need to occur.

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 - Remind workers how their efforts make a difference for the company in its pursuit
of it vision
- Make links between their work and the company vision so they can see how they
fit into the bigger picture.
- Include works in the visioning and strategies planning process that they feel they
have a stake in the organizational outcomes.
Source: www.janrubs.unl.edu/pases/publicatindijsp?publication=1999

Employee motivation impact on organizational performance

Maintaining stability
Employees are a company livelihood. How they feel about the work they are doing and
the result received from that work directly impact on organization performance and
ultimately, its stability. For instance, if an organization employees are highly motivated
and protective, they will do whatever is necessary to achieve the goals of the organization
as well s keep track of industry performance to address any potential challenges. This
two-prong approach builds an organization’s stability. An organization whose employees
have low motivation is completely vulnerable to both internal and external challenges
because its employees are not going the extra mile to maintain the organizations stability
and unstable organization under forms.

Reduction in productivity
Lack of motivation equates to less work being accomplished, productivity does not
disappear; it is usually transferred to aspects not related to the organizations work. Things
like personal conversation, internet surfing or taking longer lunches cost the organization
time and money. Reduced productivity can be detrimental to an organization performance
and future success

Negative changes to reputation

Low employee motivation could be due to decreased success of the organization,
negative effects from the economy or drastic hags or uncertainty within the organization.
No matter what the cause, having the reputation of having unpleasant work environment

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due to low employee motivation will ultimately impact how existing and potential clients
or parents view working with an organization. A reputation can proceed on organization
and indicate its future in the industry.
Source: www.ehow.combuisenss
.

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 CHAPTER THREE

3.Materials and research methodology

3.1 Study area
The study conducted in Amhara region Merawi town which is found about 530 km and
30 km away from the capital city of Ethiopia, Addis Ababa and Bahir Dar respectively.
This study conducted on effect of employee motivation on the organization performance
(in case of commercial bank of Ethiopia in Merawi branch.)

3.2 Types and sources of data

In this data both primary data and secondary data were collected from primary and
secondary sources. The primary source of data is employees and management bodies of
the organization. Secondary sources are published book, internet (web page) and
magazines of the organization.
3.3 Methods of Data collection
Both primary and secondary data were used in the study. The primary data collected by
self-Administers questionnaire for employees. Secondary data collected from
organizational records and source written about the organization.

Sampling Design
i. Sampling technique
In conducting this study the researcher has used simple random sampling technique.
Because it removes personal judgment besides unbiased sample. Thus, each element
has equal chance of being selected in the sample. Therefore, the total number of
employees the researcher has selected was 55 employees to fill the questionnaires.

ii. Population Size and Sample Size

The total number of employees of the Commercial Bank of Ethiopia in Amhara
region Merawi town Merawi branch is 294, among them 55 were selected by using
simple random sampling technique. The sample size is determined by using the
following formula.

Prepared by Yitaktu B. 16 JIGDAN COLLEGE

 2
N z p (1−p )
n=
( N −1 ) e2 + z 2 p ( 1− p )
where,
z=¿ Standard Error associated with confidence level of 90%¿ 1.64
N=¿Population Size¿ 294
p=¿Population Proportion¿ 0.5
e=¿ Acceptable Sampling Error¿ 0.1
n=¿Sample Size
2
294 ( 1.64 ) ( 0.5 ) ( 0.5 ) 197.6856
n= = =54.72 ≈ 55
2 2
( 294−1 ) ( 0.1 ) + ( 1.64 ) ( 0.5 ) ( 0.5 ) 3.6124

Therefore, in this research, among the total employees, 294, the total number of samples
(employees) taken for questionnaires is 55. The 55 employees are assumed to be the best
representative of the total employees of the branch.

3.4 Method of Data Analysis

After the data collected a kind of adjustment is taken place through; coding, categorizing
and recording the data in convenient way analysis of data were depends on the
information gathered from different sources. Tables are used for presentation of data and
interpretation is made under each table through descriptive method due to qualitative
nature of the data. Based on this analysis and interpretation the researcher has made
conclusion and recommendations.

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 CHAPTER FOUR

4. Data Analysis and Interpretation

This section is concerned with analysis and interpretation of data that were gathered by
primary source. These data mainly analyzed and interpreted item in the form of table
computation and summery format. The questionnaires were distributed for 55 employees.
Even though the questionnaires were distributed for 55 employees only 43 of them were
responded in appropriate manners. So, data analysis and interpretation were based on 43
employees.

4.1. General employees background

Under this portion the analysis and interpretation were mainly consist of sex, age,
educational qualification and marital status.

Table 4.1 Age, sex, educational level and martial tutus of respondents
Item Response Number of respondents Percentage
Age Below 2.5 10 23
26-35 20 47
36-45 8 19
46 and move 5 11
Total 43 100
Educational level Diploma 4 9
Degree 39 91
Master -
PHD -
Total 43 100
Sex Male 28 65
Female 15 35
Total 43 100
Marital status Married 15 35
Unmarried 28 65
Widow -
Divorce -
Total 43 100
Source: Compiled from questionnaire, 2023

According to table out of the total respondents 20(47%) were below 25, 10(23%) were
between age. 26-35, 8(19%) were between age 36-45 and the remaining 5(11%) were
above 46 age regarding marital status 15(35%) marred, 28(65%) were UN married and

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there were no widow and divorce employees in the organization. Among total
respondents 28(65%) were male and 15(35%) were female. On education side 4(9%)
were diploma holders, 39(91%) were first degree holders and. To conclude, most of
employees found below age 26-35, degree holders, male and unmarried.

4.2. Motivational practice

Table 4. 2. Response on motivational practice in organization
Items Response Number of respondent Percentage
Is there motivational Yes 43 100
practice in your NO
organization
Total 43 100
If you said “Yes” for Financial 43 100
above question which Non finical - -
types of motivational
tools?
Total 43 100
Source: Compiled from questionnaire, 2023

The above table depicts that out of total respondent 43(100%) said “Yes” that indicate
there were motivational practice in the organization and no employees replied NO that
indicate there were not motivational practice in the organization. So, as all of employees
replied that there were motivational practices in the organization, it is better for
organization to practice motivation in order to enhance productivity. In addition, all
employee show said yes for existence of motivational practice in organization again the
said there were financial motivations in organization.

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4.3. Motivational impact
Table 4. 3. Response about motivational impact on productivity
Items Response Number of Percentage
respondent
What is your opinion about the Satisfied -
payment system of the organization? Very satisfied -
Dissatisfied -
neutral 43 100

Total 43 100
If you said “agree “ for above Recognition letter, 43 100
questioning what is your contribution high position for
future

Total 43 100
Source: Compiled from questionnaire, 2023

The above table depict that among total respondents 43(100%) replied they were neutral
with the payment they receive that indicate not negative or not positive effect on
employee performance. So, since all of respondents were neutral there is no doubt to say
there is no good payment or good payment system in the organization.

4.4. Additional reward system

Table 4.4. Response about additional reward system
Items Response No of respondent Percenta
number ge
Is there additional reward system to Agree 26 61
who Performance better Disagree 17 39
Strong agree -
Strong disagree -

Total 43 100
Source: Compiled from questionnaire, 2023

Prepared by Yitaktu B. 20 JIGDAN COLLEGE

As it shown in above table, 17 (39%) of employees said “disagree” that indicate there
were no additional reward system in the organization and 26(61%) of them said “agree”
that depict there were additional reward system in the organization.

4.5. Security of job

Table 4. 5. Response on security of job
Items Response No of Percentage
response
What do you think Satisfied 28 65
about job security of the Dissatisfied -
organization neutral 15 35

Total 43 100
Source: Compiled from questionnaire, 2023

According to the result in above Table, 28(65%) respondents said that satisfied about job
security 15(35%) said that neutral. No respondents replied dissatisfied. As majority of
respondents replied that they are satisfied on their job security of the organization.

4.6. Punctuality of employees

Table 4.6 Response about punctuality of employees
Items Response No of response Percentage
Are you punctual for your job Yes 28 65
NO 15 35
Total 43 100
Items Response No of response Percentage
If you responded for question The 15 35
above No what is the reason? motivational
practice is not
good in the
organization
Total 15 35
Source: Compiled from questionnaire, 2023

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The above able shows that among total respondents, 15(35%) said “No” that indicate they
were not punctual to their jobs and 28(65%) said “Yes” that indicate they were punctual
for their jobs that again indicate there is no problem in the organization. Furthermore,
employees who were absent or not punctual replied that the reason for absenteeism were
the organization has not well in motivation practice. In addition, all employees who said
No are not punctual for their job. Their job they said the reason for not punctual for their
job due to low salary and low motivational. So the organization increases both reward
and motivation, the degree of turnover not punctual.

4.7. Staying in organization

Table 4. 7. Response on staying in organization
Items Response No of response Percentage
Do you happy If you stay in the Yes 30 69
organization NO 13 31

Total 43 100
If ‘YES’ in above question what is your I have do my 30 69
contribution? duties &
responsibility
effectively
Total 30 69
Source: Compiled from questionnaires 2023

The above table shows that out of total employees, 30(69%) said “Yes” that indicate they
are happy and want to stay in the organization while 13(31%) said “NO” that indicate
they want to leave the organization. So if the organization motivate and make them to
stay in the organization it is good for its performance.

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4.8. Effect of motivation
Table 4.8 Response about effect of motivation
Items Response No of response Percentage
Is there positive effect of Agree - -
motivation on performance in your Disagree 18 42
organization? Strong agree - -
Strong 25 58
disagree

Total 43 100
Source: Compiled from questionnaires 2023

The above table shows that 18(42%) of employees said “disagree” that indicate there
were no positive effect of motivation and 25(58%) said “strong disagree” that indicate
there were never positive effect of motivation on performance in their organization.

4.9. Effect of Absenteeism

Table4.9. Response on Absenteeism of employees
Items Response No of Percentage
response
Is there effect Absenteeism of employee Agree 33 78
from job on the organization performance? Disagree 10 22
Strong agree
Strong disagree
NO
Total 43 100
Your salary level is satisfactory? Satisfied 12 28
very satisfied - -
dissatisfied - -
neutral 31 72

Total 43 100
Source: Compiled from questionnaires 2023

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The above tale shows that out of total employees, 33(78%) said “agree” that indicate
there where Absenteeism have effect of employee from job and while 10(22%) said
“disagree” that indicate they were not effect of employees from job. And out of total
employees 12(28) said “satisfied” that indicate their salary level is satisfied and 31(78)
said “neutral” that indicate they were interest to something.

4.10. Fairness of Reward

Table 4.10. Response on who fairly rewarded in the organization
Items Response No of response Percentage
Employees are fairly rewarded in Agree 26 60
your organization? Strong agree -
Disagree 17 40
Strong disagree -

Total 43 100
Source: Compiled from questionnaires 2023

According to above table 26(60%) of employees said “agree” that indicate there were
employees who fairly rewarded in the organization and 17(40%) said “disagree “that
indicate there were employees who not fairly rewarded in the organization.

Their job they said the reason for not punctual for their job due to low salary and low
motivational. So the organization increases both reward and motivation, the degree of

turnover not punctual.

Prepared by Yitaktu B. 24 JIGDAN COLLEGE

 CHAPTER FIVE

5. Conclusion and Recommendation

5.1 Conclusion
Most of the employees of commercial banks of Ethiopia in Merawi Branch are found
below the age of 25 and most of them are male.

 Commercial bank of Ethiopia used financial motivation to motivate employees.

 Motivation has positive impact on the productivity of the organization.

 There is no sufficient and enough monthly salary for employees. This less
payment has an adverse effect on the motivation, further on the productivity of the
organization performance as whole.

 Most of the workers of the organization dissatisfied with payment system of

organization and there is not good payment system in the organization.

 There is no good opportunity for promotion and no additional reward system for
who perform better.

 Almost all of the workers happy to stay in the organization.

 Most employees of organization are not punctual because the organization is not
good in motivational practice.

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5.2. Recommendation
Based on the analysis of fact and findings, the followings are recommended to upgrade
employee’s motivation that has positive impact on productivity of commercial bank of
Ethiopia in Merawi Branch.

The company should practice the system of increasing the scale of salary and rewards for
those whose productivity is better than others.

 Since dissatisfaction of employees leads to turn over which has adverse impact on
productivity of organization, the organization should satisfy those who were
dissatisfied.

 Due to the fact that motivated employees have good commitment to the
organization and perform their job accordingly, the organization should give the
chance of motivation to employees.

 The management of the organization should be approachable and listen the

comment of employees regarding motivation problems in the organization to
increase the performance of the organization.

 Prime focus should be given on the side of organization for employees who
perform better and initiate other employees in order they perform better.

 The organization should follow up the employees who are not punctual to their
jobs and make them punctual.

 Since the organizations were good in a system of staying employees, they should
continue in a good manner for future.

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 Reference
1. Davis and new arom (1989) Human behavior at work
2. Dessler (1998) Human resource management 9th edition
3. Ivan ceviche and Matheson. 1990. Organizational behavior USA, Richard
D.Irwism Inc.
4. Bernard L.Rosembaum.1982.How to motivate to days workers USA, MCG raw Hill
book co.

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 Appendix

JIGDAN COLLEGE
Department of Management
A questionnaire developed to collect the data from employees. This questionnaire is
designed to collect data on the effect of employee motivation on organization
performance.

Dear respondents, the purpose of this questionnaire is to collect data for the study about
effect of employee motivation on organization performance in case of Merawi branch.
Responding to this questionnaire will not create any harm. Therefore, you are kindly
requested to respond with confidence while you are asked.

Instructions
i) No need of writing your name.
ii) Put a “X” mark for your answer.
iii) Please give brief description for open ended questions.
iv) For closed end question give your answer on the space provided.
a. Respondents background Information
1. Sex male  female 
2. Age less than 25 years  26-35 years 
36- 45 years  46 -55 years above 56 
3. Education level
Diploma  first Degree  PHD 
Master (2nd Degree) 
4. Marital status
Married  Widow  UN married  Divorce 
b. General Questionaries’
1. Is there motivational practice in your organization?
Yes  No 

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 2. If you said “yes” for question one which types of motivation?
Financial  non-financial 

3. Do you think you would be happy on your organization performance?

Yes No
4. If yes in above question what is your contribution?
__________________________________________________________________
____________________________________________________
5. If you said “NO” for above question what is your reason?
__________________________________________________________________
_____________________________________________________
6. What is your opinion about the payment system of organization?
Satisfied  neutral 
Very satisfied  dissatisfied 
7. Is there any additional- reward system to those who perform better?
Agree  Disagree 
Strong Agree Strong Disagree
8. If agree in above question what are they? _______________________________.
9. What do you think about job security of the organization?
Satisfied  neutral  Dissatisfied 
10. ARE you happy and punctual for your job?
Yes  No 
11. If you responded for question 10 “No” what is the reason?
__________________________________________________________________
__________________________________________________
12. Is there positive effect of motivation on performance in your organization?
Agree Dis agree
Strong agree Strong disagree
13. Is there effect Absenteeism of employees from job on the organization
performance?
Agree Disagree Strong Agree Strong Disagree

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 14. Your salary level is satisfactory?
Satisfied Dissatisfied
Very Satisfied Neutral
15. Employees are fairly rewarded in your organization?
Agree Disagree
Strong agree Strong disagree

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