AMBO UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS

DEPARTMENT OF MANAGEMENT
FACTOR AFFECT ORGANIZATIONAL COMMITEMENT
(THE CASE OF AWASH BANK).

PREPARED BY:
MESAY TAFESSE

JULY 2023
ADDIS ABABA,

AMBO UNIVERSITY
 SCHOOL OF GRADUATE STUDIES
FACTOR AFFECT ORGANIZATIONAL COMMITEMENT (THE
CASE OF AWASH BANK).

ATHESIS PROPOSAL SUBMITTED TO AMBO UNIVERSITY

SCHOOL OF GRADUATE STUDIES DEPARTMENT OF
MANAGEMENT IN PARTIAL FULFILLMENT OF THE
REQUIREMENTS FOR THE DEGREE OF MASTER OF
BUSINESS ADMINISTRATION IN MANAGEMENT.

PREPARED BY:
MESAY TAFESSE

ADVISOR:
BEKAN SERBESSA (PhD CANDIDATE)
Contents
Chapter One.................................................................................................................................................4
Introduction..................................................................................................................................................4
1.1 Background of the Study...................................................................................................................4
1.2. Statement of the Problem.................................................................................................................7
1.3. Research Question..........................................................................................................................8
1.4. Research Objectives........................................................................................................................9
1.4.1. General Objective........................................................................................................................9
1.4.2. Specific Objectives...................................................................................................................9
1.5. Significance of the study.................................................................................................................9
1.6. Scope of the Study.........................................................................................................................10
Chapter Two............................................................................................................................................10
Review of Related Literature..................................................................................................................10
2.1. Introduction..................................................................................................................................10
2.2. Theoretical Background:.............................................................................................................10
2.2.1. Organizational Commitment................................................................................................10
2.2.2. The Importance of Organizational Commitment................................................................14
2.2.3. Factors Affecting Employees’ organizational Commitment...............................................15
2.2.4. Development of Organizational Commitment.....................................................................20
2.2.5. Measurement of Organizational Commitment....................................................................22
2.2.6. Correlates of Organizational Commitment.........................................................................24
2.2.7. Factors affecting the level commitment................................................................................27
2.3. Empirical Review..........................................................................................................................27
2.3.1. Relationship between organizational commitment and citizenship behavior....................28
2.4. Conceptual Framework................................................................................................................29
Research Methodology............................................................................................................................31
3.1. Research Design............................................................................................................................31
3.2. Population and Sampling.............................................................................................................31
3.3. Source of Data...............................................................................................................................35
3.4. Procedures of Data Collection.....................................................................................................35
3.5. Methods of Data Analysis.............................................................................................................35
3.6. Ethical Issues of Research............................................................................................................35
 3.7. Validity and Reliability Checks...................................................................................................36
3.8. WORK PLAN, TIME BREAK DOWN AND BUDGET...............................................................36
3.8.1. Work Plan..................................................................................................................................36

Contents
Chapter One...............................................................................................................................................5
Introduction...............................................................................................................................................5
1.1 Background of the Study.................................................................................................................5
1.2. Statement of the Problem...............................................................................................................8
1.3. Research Question..........................................................................................................................9
1.4. Research Objectives......................................................................................................................10
1.4.1. General Objective......................................................................................................................10
1.4.2. Specific Objectives.................................................................................................................10
1.5. Significance of the study...............................................................................................................10
1.6. Scope of the Study.........................................................................................................................11
Chapter Two............................................................................................................................................11
Review of Related Literature..................................................................................................................11
2.1. Introduction..................................................................................................................................11
2.2. Theoretical Background:.............................................................................................................11
2.2.1. Organizational Commitment................................................................................................11
2.2.2. The Importance of Organizational Commitment................................................................15
2.2.3. Factors Affecting Employees’ organizational Commitment...............................................16
2.2.4. Development of Organizational Commitment.....................................................................21
2.2.5. Measurement of Organizational Commitment....................................................................23
2.2.6. Correlates of Organizational Commitment.........................................................................25
2.2.7. Factors affecting the level commitment................................................................................28
2.3. Empirical Review..........................................................................................................................28
2.3.1. Relationship between organizational commitment and citizenship behavior....................29
2.4. Conceptual Framework................................................................................................................30
Research Methodology............................................................................................................................32
3.1. Research Design............................................................................................................................32
3.2. Population and Sampling.............................................................................................................32
3.3. Source of Data...............................................................................................................................36
 3.4. Procedures of Data Collection.....................................................................................................36
3.5. Methods of Data Analysis.............................................................................................................36
3.6. Ethical Issues of Research............................................................................................................36
3.7. Validity and Reliability Checks...................................................................................................37
3.8. WORK PLAN, TIME BREAK DOWN AND BUDGET...............................................................37
3.8.1. Work Plan..................................................................................................................................37

APPROVAL SHEET OF PROPOSAL

This is to certify that the thesis prepared by Mesay Tafesse entitled “Factors affect
organizational Commitment: The Case of Awash Bank S.C’’ and submitted in partial
fulfillment of the requirements for the MBA in management in complies with the regulations
of the University and meets the accepted standards with respect to originality and quality.

Name of student:
_________________________ _______________ _______________
Major advisor Signature Date

_________________________ _______________ _______________

Head of department Signature Date

_________________________ _______________ _______________

Dean, SGS Signature Date
Chapter One
Introduction
1.1 Background of the Study
Committed employees are one of the greatest assets of any organization can have and play a
major role in overall organizational efficiency and performance. Hurter (2008) argues that
greater levels of employee commitment lead to organizational benefits such as a continuous flow
of improvements, cost and efficiency improvements and active employee participation.
Committed employees are believed to enhance an organization as they feel secure in their jobs,
are well trained, feel part of a team and are proud thus enjoying doing their jobs (Wen-Hsien
2009).
Commitment, according to Jaw and Liu (2004), is not only a human relation concept but
involves generating motivation and activating the human mind. Without commitment, the
implementation of new ideas and initiatives will be compromised (John and Elyse, 2010).
Commitment has also been defined as a psychological state that binds the individual to the
organization. This binding force can be experienced in different ways that can be accompanied
by different mindsets including: an affective attachment and involvement with the target, a felt
obligation to the target, and an awareness of the costs associated with discontinuing involvement
with the target (Boxall and Macky, 2009).

Organizational commitment is a behavior that benefits the organization but is not required as part
of the job description and is therefore discretionary (Armstrong, 2009). By discretionary, it is
mean that the behavior is not an enforceable requirement of the role or the job description, that
is, the clearly specifiable terms of the person’s employment contract with the organization; the
behavior is rather a matter of personal choice, such that its omission is not generally understood
as punishable. According to Armstrong (2009), an organizational commitment strategy will
cover what needs to be done to: communicate the values and aims of management and the
achievements of the organization, so that employees are more likely to identify with it as one
they are proud to work for, demonstrate to employees that management is committed to them by
recognizing their contribution as stakeholders and by striving to maximize job security, develop
a climate of trust by ensuring that management is honest with people, treats them fairly, justly
and consistently, keeps its word and shows willingness to listen to the comments and suggestions
made by employees during processes of consultation and participation, create a positive
psychological contract by treating people as stakeholders, relying on consensus and cooperation
rather than control and coercion and focusing on the provision of opportunities for learning,
development and career progression, establish performance management processes that provide
for the Alignment of organizational and individual objectives, help to increase employee
identification with the organization through rewards related to organizational performance (profit
sharing or gain sharing) or employee share ownership schemes, overall, establish and maintain a
working environment that makes the organization an ‘employer of choice’ because it is ‘a great
place to work’.

Organizational commitment can be considered the unwritten psychological contract between the
employer and employee in such a way that the employee expects to be treated fairly and also
expects to be benefited from the mutual agreement and in the same fashion, the employer expects
the employee to do his/hers best to meet the organizational objective and also to be able to
identify oneself with the organization. Hence, in this competitive business area, the full
realization of benefits that an organization can harness from implanting organization citizenship
behavior in the mindset of its employees via various employee retention mechanisms is crucial
for improved efficiency, effectiveness, job engagement, and to enhance co-operative work
environment.

Researchers have attempted to construct and view commitment as multi-faceted. In line with
this, Conway, Edel, Kathy and Monks (2010) contend that conceptualization of commitment
comprising three separable components which include affective commitment, continuance
commitment and normative commitment. Affective commitment refers to the employee’s
emotional attachment to, identification with, and involvement in the organization. (Wang, 2010).

On the other hand, continuance commitment describes an individual’s need to remain with an
organization resulting from her/his recognition of the costs such as tenure, pay, benefits, vesting
of pensions and family commitment associated with leaving the organization. Employees whose
primary link to the organization is based on continuance commitment remain because they need
to do so (Loi and Foley, 2008).

Normative commitment reflects an individual’s feeling of obligation to maintain organizational

membership because he/she believes it is morally right to be loyal to, and stay in the
organization. Although normative commitment is widely recognized as a salient dimension of
employee commitment, it has been found to be substantially interrelated with affective
commitment (CoyleShapiro, 2008). Different authors suggest that individuals may display each
of these three forms of commitment to varying degrees.

Evidences derived from social science researches have shown that there is now a broad
agreement amongst commentators that high commitment work practices do improve
performance, labor productivity and the quality of service (Owoyemi, Oyelere, Elegbede, and
Gbajumo-Sheriff, 2011). Although researchers such as (Boxall and Macky 2009) have argued
that the majority of previous studies have looked at high commitment work practices from the
employers ‘perspective, and the over dependence on such perspectives can sometimes be
misleading and will not present the real impact of employee commitment which results in
positive outcomes in organizational performance. Nevertheless, when employees positively
interpret high commitment work practices, it will sequentially increase their commitment to the
organization, thereby increasing their individual performances and hence organizational
performance will also increase (Owoyemi et al., 2011).

No organization in today’s competitive world can perform at peak levels unless each employee
is committed to the organization’s objectives and works as an effective team member.
Employees have to think like entrepreneurs while working in teams, and have to prove their
worth. However, they also want to be part of a successful organization which provides a good
income and the opportunity for development and secure employment (John et al., 2010).
Through the years, numerous research studies have been conducted to determine the accuracy
 of this statement. In the end many have concluded that committed employees remain with the
organization for longer periods of time than those who are less committed (Scott, 2007).

Therefore, this study focused on the factors that affect employee organizational commitment the
case of Awash Bank head office and north Addis Ababa regional branches. The study examined
the empirical understanding concerning the determining factor of AB’s commitment in order to
accomplish organizational objectives.

1.2. Statement of the Problem

Employee commitment will result into benefits which include: increased job satisfaction
increased job performance, increased total return to shareholders, increased sales, decreased
employee turnover, decreased intention to leave, decreased intention to search for alternative,
decreased absenteeism (Taylor, 2011). With this in mind, employee commitment should be
viewed as a business necessity. Organizations who have difficulty in retaining and replacing
competent employees will find it hard to optimize performance. There are not only the
immediate expenses of the recruitment process, but other hidden costs such as management time
and lost productivity as new employees take time to become effective in their roles (Robinson,
Torvik&Verdier,2006). Commitment-based service organizations believe that staff’s
commitment contributes to workforce stability and better customer service hence increase
business and organizational performance (Nguyen, 2014). Current changes in employment
practices affect organizational commitment which is on the unwritten loyalty contract between
employees and employers (Robinson et al. 2006). Employment practices such as layoffs,
downsizing and mergers are stimulated by the need to be competitive but cause employees to
have low levels of commitment, as a result employee may view their organizational commitment
differently (Robinson et al. 2006).

When organizations seek to foster a philosophy of commitment, then the likelihood of an

employee searching for employment elsewhere is lowered. According to Bin, Ahmed, Shafi and
Shaheen (2011), the individual factors that influence the level of employees’ commitment to an
organization are age, job security in the organization and the marital status of the employee.
further state that other Individual factors may include material benefits and psychological
rewards such as bonuses, including status, loyalty and approval but none the less age, job
security and marital status emerge stronger. For example, in the workplace, the supervisor
provides a subordinate with support and monetary rewards while in exchange, the subordinate
contributes personal devotions and expertise (Gantasala, 2011). However, researchers have also
mentioned other factors which foster employees’ commitment. These include: job-related
factors; employment opportunities; personal characteristics; positive relationships; organizational
structure; employee motivation; performance appraisals; and management style (Scott et al.
2007).

On the other hand, they have not done studies conducted on AB’s a combination of main
organizational factors that affect employee’s commitment, individual factors affect employee’s
organizational commitment and the levels of employee’s organizational commitment. That is
why the researcher initiates to conduct this research. Therefore, this paper well considered
important to examine factors that affect employees’ organizational commitment of AB’s head
office and north Addis Ababa Regional Branches.

Bank companies are basically human intensive, and human resources act as an undoubted
differentiator. Quality manpower would act as a litmus test. Turnover of the work force has been
high because of low entry and exit barriers in the industry (IRA Report, 2013).

In the case of our subject, AB, there are various monetary and non-monetary factors affect
employee organizational commitments such as compensation and reward system, training and
development opportunities, job security, supervisor support, work environment, and
organizational justice.

1.3. Research Question

 What is the effect of compensation on employee organizational commitment?
 What is the effect of training on employee organizational commitment?
 What is the effect of organizational Justice on employee organizational commitment?
 What is the relationship between supervisor support and employee organizational
commitment?
 What is the relationship between job security and employee organizational
commitment?
  What is the relationship between working environment and employee organizational
commitment?

1.4. Research Objectives

1.4.1. General Objective
The general objective of this study is to examine the factors affect employee organizational
commitment in case of Awash Bank head office and North Addis Ababa regional branches.

1.4.2. Specific Objectives

The following are specific objectives of the study:

 To assess the effect of compensation on organizational commitment.

 To examine the effect of training on employee organizational commitment.
 To assess is the effect of organizational Justice on employee organizational
commitment.
 To investigate the relationship between supervisor support and employee
organizational commitment.
 To identify the relationship between job security and employee organizational
commitment.
 To identify the relationship between work environment and employee organizational
commitment.

1.5. Significance of the study

These studies try to investigate the determinant’s factors employees’ organizational commitment
in the case company. In the same fashion, it has also try to assess the gap between the
management’s perceived and the actual result as an outcome of the programs. Accordingly, the
study will be able to paint a clear picture of the actual factors that affect organizational
commitment.
By focusing on the examine of factors which affect AB’s employee commitment, the study
might trigger future researchers to identify others factors that affect employee organizational
commitment. Lastly, it provides at least a basis for further studies related to organizational
commitment of employees on the organization principals.
1.6. Scope of the Study
The study is limited to the factors affecting employee organizational commitment in the case of
Awash Bank S.C and to its selected employees that are found at Head Office Level and North
Addis Ababa region Branches’. Due to limited resources, time constraints, and geographical
dispersion of the respondents, the researcher will be focuses on the determinant factors and its
effect on employees’ organizational commitment.

Chapter Two

Review of Related Literature

2.1. Introduction
In this section various literatures in relation with the basic premise of this study are reviewed so
as to draw a clear theoretical framework of the subject matter. Accordingly, the distinct meaning
and features of determinant factors of organizational commitment and employee’s organizational
commitment is elaborated in detail.
2.2. Theoretical Background:
2.2.1. Organizational Commitment
Commitment is a concept that has attracted a great deal of attention from scholars from multiple
disciplines including industrial psychology, sociology, and organizational management.
Commitment comes in different forms and has different foci; Becker (1992) views the different
foci in terms of commitment to the organization, top management, supervisors or the work
group. Cohen (2007) demonstrated the importance of commitment to different foci in the
workplace and provided a better understanding of how commitment affects employees‟ attitudes
and performance. Different forms of commitment have been found to be important predictors of
behaviors such as performance, organizational citizenship behavior, turnover, and absenteeism
(Cohen, 2007)

In other case; Organizational commitment has been described as the degree of an individual’s
identification with, and devotion to a specific organization, including: (1) value commitment: the
strong belief in, and the acceptance of the organizational objectives and values; (2) effort
commitment: the willingness to dedicate greater effort to benefit the organization; (3) retention
commitment: the willingness to remain as a member of an organization (Lambert, 2006). Dee et
al., (2006) believed that organizational commitment represented an individual emotional
attachment to an organization, including identification with, and acceptance of, organizational
objectives and values; mental devotion to, and concentration on, a job role; and loyalty to, and
affection for the organization.

Similarly; Meyer and Allen (1997) define a committed employee as being one “stays with an
organization, attends work regularly, puts in a full day and more, protects corporate assets, and
believes in the organizational goals”. This employee positively contributes to the organization
because of its commitment to the organization. Research shows that individuals and
organizations are adversely affected when commitment is low, and that both benefit when
commitment is high (Joel Brockner, 1992). Organizational commitment is associated with
increased satisfaction, performance, and organizational adaptability (Meyer et al., 2002), as well
as decreased absenteeism and employee turnover (Lo et al., 2010).

The benefits of employees’ organizational commitment have been well documented in the
existing management literature. Committed employees are more likely to develop patterns of
punctuality or to be chronically present at work (Brockner et al., 1992). Employees that are
committed are also less likely to leave the organization to explore other opportunities (Meyer et
al., 1991). Organizational commitment has also been shown to positively affect motivation,
organizational citizenship, and job performance (Meyer et al., 2002).

Meyer et al., (2002) developed a three-part model for organizational commitment that continues
to be widely used and challenged. Meyer et al., (2002) defined organizational commitment as a
psychological state that characterizes the employee’s relationship with the organization, and has
implications for the decision to continue or discontinue membership in the organization. The
three component model described by Meyer et al., (1991) consists of affective, continuance, and
normative commitment. It has been shown that an employee’s commitment level to each of the
organizational commitment construct may vary depending on how much the employee want,
need, or ought to remain a member of the organization. That means affective commitment as the
psychological attachment to the organization (individuals stay with the organizations because
they want to); continuance commitment referring to the cost associated with leaving the
organization (individuals stay with the organization because they need to) and normative
commitment as the perceived obligations to remain with the organization (individuals stay with
the organization because they feel they should or ought to). Meyer et al., (1997) suggested three
components of organizational commitment as listed below:
2.2.1.1 Affective Commitment
It refers to employee’s emotional attachment, identification with and involvement in the
organization. Employees with a strong affective commitment stay with the organization because
they want to. The processes leading to the development of affective commitment are taken from
exchange principles (Mottaz, 1988; Mowday et al., 1982).

An organization typically provides rewards or punishments at its disposal in return for the
contributions its employees make or fail to make, and the employees commit themselves to the
organization in return for the rewards received or the punishments avoided.

According to lo et al., (1997) Researchers anticipate that met expectations, work involvement,
and positive affectivity will increase affective commitment, whereas negative affectivity will
decrease it. In addition, the literature indicates that the environment in which organizations
operate influences the employees' orientations. Therefore, researchers expect that external job
opportunity will decrease affective commitment, whereas social support from spouse, parents,
and friends outside work will increase it. Mowday et al., (1982) also described affective
commitment as “a mind-set in which individuals consider the extent to which their own values
and goals are congruent with those of the organization”. In this model, a person can become
committed without making an overt pledge; if a person develops sufficient set of strong and
positive attitudes or sense of goal congruence, then at some point that person is committed.
Similarly, affective commitment is also attitudinal based and in this situation the employee sees
him/herself as a part of the organization. Individuals with high levels of affective commitment
continue employment because they want to. Mohamed (2013) conclude that job satisfaction was
positively related to affective organizational commitment. Therefore, it is very important for the
organizations to have employees feeling affective commitment since strong affective
commitment means employees willing to stay in the organization and accepting its objectives
and values (Meyer et al., 1991).
2.2.1.2. Continuance Commitment
It refers to employee’s point of view of whether the costs of leaving the organization are greater
than of the costs of staying. In continuance commitment, the employees consider the
disadvantages of leaving the organization and avoid quitting. Employees who perceive that the
costs of leaving the organization are greater than the costs of staying remain because they need
to. Anything that increases the cost associated with leaving the organization can lead to the
development of continuance commitment (Meyer et al., 1997). Self-investment is the amount of
valuable resources such as effort, time, and energy that an employee has spent in the
organization for its well-being (Meyer et al., 1991).

Increased effort and energy by employees will increase their continuance commitment, because
leaving the organization will result in the loss of the valuable resources spent for the
organization. The lack of transferability of job skills and knowledge will also increase the costs
of leaving the organization, because it makes it difficult for employees to find alternative jobs
that fit (Becker, 1998). If employees move to another organization, it may disrupt the social
relationships they have and increase the psychological “cost of making new friends and learning
to get along with new working associates” (Becker et al., 1992). According to Becker et al.,
(1992), the lack of external job opportunities increases the costs associated with leaving the
organization. Therefore, the fewer available alternative jobs in the environment, the greater will
be the employees' continuance commitment to their current employer.

2.2.1.3 Normative Commitment

It refers to employees’ feelings of obligation to the organization. Employees with high levels of
normative commitment stay with the organization because they feel they ought to. On the basis
of the works of Wiener (1982) and Scholl (1981), Meyer et al., (1991) suggested that two
mechanisms, socialization and exchange, play a key role in the development of normative
commitment. According to Wiener et al., (1982), normative commitment develops as a result of
normative beliefs that are internalized through pre-entry (familial and cultural) and post entry
(organizational) socialization processes. Therefore, a commitment norm, which is labeled as
internalized normative beliefs by Wiener et al., (1982), is examined as a possible determinant of
normative commitment.
It has argued that normative commitment is only natural due to the way we are raised in society.
Normative commitment can be explained by other commitments such as marriage, family,
religion, etc. Therefore, when it comes to one’s commitment to their place of employment, they
often feel like they have a moral obligation to the organization (Meyer et al., 2002). The second
mechanism that is operative in the development of normative commitment is the principle of
exchange, or what is called a norm of reciprocity by Scholl et al., (1981). According to this
principle, normative commitment develops through the receipt of rewards from the organization
that instill a sense of moral obligation to reciprocate with commitment.

Organizational commitment depends on the perception of employees (Eisenberger, 1986). Steers

(1997) shows that if the employee finds the organization to be more supportive, a higher level of
organizational commitment will result and the direct effort to induce commitment can produce
long term benefits for the organization (Liu et al., 2007).

In other case, Steers et al., (1997) grouped several correlates of organizational commitment into
two categories of antecedent variables and labeled them personal characteristics and situational
attributes. Personal characteristics are defined as individual-based variables such as age, sex,
race, personality, and attitudes. The situation attribute category includes organizationally-
mediated variables such as the structural properties of the organization and human resource
processes.
2.2.2. The Importance of Organizational Commitment
Most previous research has suggested that organizational commitment is more strongly related to
turnover, organizational citizenship behaviors and reduced absenteeism than is job satisfaction
(Watson and Hatton, 2002), an employee’s intention to quit is inversely related to the
organizational commitment (Angle and Perry,1981), this will result to lower levels of turnover
when there are higher level of organizational commitments and high commitment facilitates
loyalty so as stable workforce can be sustained despite external environment changes. Liu et al.,
(2007) claimed that individuals who are motivated would be more committed to their tasks and,
hence, perform better.

Wiener et al, (1982) also reported that there is a positive correlation between commitment and
job performance. Organizations benefit from a committed workforce because committed
employees tend to be absent less often, to make positive contributions and to stay with the
organization (Bishop and Scott, 2000).

According to Meyer et al. (1997), a committed employee is the one who stays with the
organization through thick and thin, attends work regularly, puts in a full day (and maybe more),
protects company’s assets, shares company goals and others. Thus, having a committed
workforce would be an added advantage to an organization. Additionally; (Bishop et al., 2000)
believe commitment to an organization also relates to the profit from participating, and the cost
of leaving the organization, such as loss of prestige and stability of a working environment.

Sarantinos (2007) alleges that commitment is directly tied to the psychological contract, which,
in essence, describes the implicit agreement between employees and the organization with
regards to their reciprocal obligations and perceived expectations. The most important factor in
determining an individual’s motivation is the psychological contract, defined as the set of
expectations between an employee and some implicit components of an organization, i.e. pay,
dignity, opportunities. In return, the organization demands loyalty and commitment (Schein,
1980). From this, we can be concluded that, commitment of employees is very essential for
organization in order to achieve the objective of the organization.
2.2.3. Factors Affecting Employees’ organizational Commitment
There are a variety of organizational factors that shape employee’s commitment. Such factors
include the following: compensation; training; supervisor support; organizational justice; and
working environment.
2.2.3.1. Effects of Compensation /Reward on organizational commitment
Compensation/ Reward is something that an organization gives to the employees in response of
their contribution and performance. A compensation/ reward can be extrinsic or intrinsic, it can
be a cash reward such as bonuses or it can be recognition such as naming a worker an employee
of the year. The extrinsic rewards are the most tangible, such as salaries, bonuses, promotions
etc., yet these incentives alone are not enough. Employees judge the quality of their job in the
intrinsic satisfaction (the personal reward they get from their work). Using intrinsic rewards to
increase employee commitment and retention is achievable in any organization. While it is both
an art and science, it has basic component of human nature that are fundamental. When these
intrinsic approaches are understood and ingrained in the organization’s culture, productive
employees remain. It has been asserted that, when pay and benefits are comparable to the market,
it is the intangibles that make for a dedicated workforce (Shecht man, 2008).

Compensation is something that an organization gives to the employee so that the employees
become motivated for future positive behavior (Ongori, 2008). In a corporate environment,
compensation can take several forms. It includes cash bonuses, recognition awards, free
merchandise and free trips. It is important to note that the rewards have a lasting impression on
the employee and it will continue to substantiate the employee’s perception that they are valued
(Johnson, 2004). Recognition and reward programs are an important factor of an employee
organizational commitment plan. The importance of these kinds of program is rooted in theories
of positive reinforcement. By saying “thank you” to employees for a job well done or a pat on a
shoulder to show appreciation, an organization is reinforcing ideal behavior and encouraging
more of the actions that will make it successful (Johnson, 2004). People who feel appreciated are
more positive about themselves and their ability to contribute; employees who understand how
their efforts contribute to the success of the organization overall are the most engaged, and
therefore the least likely to leave. The Society for Human Resources Management (SHRM) says
that rewards are one of the keys to avoiding turnover, especially if they are immediate,
appropriate, and personal. The Hay Group and Fortune magazine study of the “Most Admired
Companies” also cites compensation and recognition as a key driver of employee retention, as it
creates a culture that motivates and supports employees (Hay Group, 2007). In the absence of a
structured program and an accompanying workplace philosophy about recognizing good work, it
is easier for employees to leave. "People don't quit jobs, they quit relationships," said Ferris,
paraphrasing the conclusion of a Gallup study (Murray, 2007).

A valued employee is more likely to stay in employment than unvalued employee is. Sutherland
(2004) argues that reward systems ought to be a significant sphere of innovation for employers.
The increasing diversity of the workforce, she says, suggests the need for more creative
approaches to tailoring the right rewards to the right people. She concluded that recognition and
reward are part of a more comprehensive effort at keeping workers or adopting good workplace
practices which can contribute to increased employee retaining and organizational commitment.

Recognition is one of the most important methods of rewarding people. Employees need to know
not only how well they have achieved their objectives or carried out their work, but also that
their achievements are appreciated. Recognition needs are linked to the esteem needs of
Maslow’s hierarchy of needs. Recognition can be provided by positive and immediate feedback
and praises where it is well observed (Armstrong &Murlis, 2008).

Compensation/Rewards are very important for employee organizational commitment because it

fulfills the basic needs as well as helps to attain the higher level of goals. Earnings is the way by
which employee get to know how much they are gaining by dedicating their time, effort and skill
in a job (Armstrong, 2010). Attractive remuneration packages are one of the very important
factors determining organizational commitment because it fulfills the financial and material
desires as well as provide the means of being social by employee’s status and position of power
in the organization (Pfeiffer, 1998). Many researchers demonstrate that there is a great deal of
inter-individual difference in understanding the significant of financial rewards for employee
organizational commitment (Woodruffe, 1999). An organization’s reward system can affect the
performance of the employees and their desire to remain employed (Robinson &Pillemer, 2007).

2.2.3.2. Effect of Job security on organizational commitment

With increasing complexity and size of today’s organization and the increasing level of
organizational commitment, organization are opting for a mixed structure which combines the
benefits of all forms of Job security and this goes a long way to enhance optimization of job
satisfaction by workers. Though, the contingency theory does not in any way support
organization sticking to a particular model of organizational structure because of the dynamism
of the environment. The uncertainty and instability of the present day organization’s
environment made them to advocate the use of structures in a situation ally appropriate manner.
Empirical studies of Cambell, Fowles, Weber (2005), Kakabadse and Worrall (2004), Ali (2004),
Hage (1995), Spritzer (1996), confirmed a positive relationship between Job security and job
satisfactions. Their result substantially supports positive effect of structure on job satisfaction.

2.2.3.3 Effects of Work Environment on organizational commitment

The working environment is also identified as another factor that affects organizational
commitment. One of the common working environmental conditions that may affect
organizational commitment positively is partial ownership of a company. Ownership of any kind
gives employees a sense of importance and they feel part of the decision-making process (Klein,
1987). This concept of ownership which includes participation in decision-making on new
developments and changes in the working practices, creates a sense of belonging (Armstrong,
1995). A study conducted by Subramanian and Mia (2001) also indicates that managers who
participate in budget decision- making tend to have a high level of organizational commitment.

Another factor within the work environment that may affect organizational commitment is work
practices in relation to recruitment and selection, performance appraisal, promotions and
management style (Meyer et al., 1997). Obtaining top management leader ship and commitment
is critical for diversity programs of organization to succeed. One way to communicate this
commitment to all employees’.as well as the external environment is to incorporate the
organization’s attitudes toward diversity into the corporate mission statement and into strategic
plans and objectives Thomas S. (2002), Metcalfe and Dick (2001, p 412) in their study conclude
that “the low level of organizational commitment of constables could be attributed to
inappropriate selection and promotion which lead to the perpetuation of managerial style and
behavior that has a negative effect on organizational commitment of subordinates”. In all of the
empirical studies, interestingly team work sprit plays the most influential role in predicting
commitment. The more satisfied staff is with work place the higher commitment to organization
they will make. This can be understood as affective orientation rather than income orientation
(normative commitment) and benefit (continuance commitment) Tung N., Khuong N., and
Phuong V. (2014).

Working conditions is the factors that involve the physical environment of the job: amount of
work, facilities for performing work, light, tools, temperature, space, ventilation, and general
appearance of the work place. If the working conditions of an institution/organization are
conducive, its performance will improve dramatically (Leith wood, 2006). The working
conditions are conducive when administration provides their employees to safe and healthy
environment. Furthermore, the availability of necessary equipment and other infrastructures are
one that may reduce the effectiveness of employees as well as the organization. Therefore,
organization managers put their effort in making the working conditions safe, health, adequately
furnished and attractive to use the employee’s knowledge, skill and creativity for the
organization effective competitive advantage (VSO, 2002). Working condition sensible impact
on an employee’s organizational commitment because the employees prefer physical
surroundings that are safe, clean, and comfortable for works (Robbins, 2005).

2.2.3.4. Effects of supervisor support on employee organizational commitment

The process of supervisor support making adopted by the leaders is therefore a vital determinant
to how far the progress of a give organization will take place, transformational leaders are argued
to be visionary and enthusiastic, with an inherent ability to motivate subordinates (Bycioet al.,
1995; Howell and Avolio, 1993).Although the brief summary above indicates that supervisor
support has gone through periods of skepticism, recent interest has focused on the importance of
the leadership role to the success of organizations. Fiedler (1996), one of the most respect
researchers on leadership, has provided a recent treatise on the importance of supervisor support
by arguing that the effectiveness of a leader is a major determinant of the success or failure of a
group, organization, or even an entire country. Indeed, it has been argued that one way in which
organizations have sought to cope with the increasing volatility and turbulence of the external
environment is by training and developing leaders and equipping them with the skills to cope
(Darcy and Kleiner, 1991; Hennessey, 1998; Saariet al., 1988).

2.2.3.5. Effects of training on employee organizational commitment

One of the most difficult thing people live within today’s workforce is the constant feeling of
needing to sell oneself with no time to achieve personal or professional goals (Moses, 1999).
Employee development programs can make a big difference in alleviating such feelings.
Employees have a hard time caring about a company if they do not believe the company cares
about them (Garger, 1999). People recognize the value of working for a company that is willing
to invest money in them, even if that investment ultimately benefits the organization (Wilson,
2000).
According to Carole Jurkiewicz, two factors the impact employee satisfaction and commitments
are, “feelings that the organization can be relied on to carry out its commitments to its employees
and feelings that the individual is of some importance to the organization” (2000). Not only do
organizations need their employees to help them be successful, employees need to feel like they
are making a difference in reaching business goals (Gerbman, 2000).

Companies utilizing employee development programs are experiencing higher employee

satisfaction with lower turnover rates (Wagner, 2000). According to Stacey Wagner, a director
with the American Society for Training and Development, training builds company loyalty
because employees know the organization is investing in their futures (Rosen Wald 2000)

2.2.3.6. Effects of Organizational justice on employee’s organizational commitment

Organizational justice is determined by organization’s dominating values (Deal and Kennedy,
2002; Lauzen and Dozier, 1994) accepted and implemented by majority of employees (Wallack,
1983), as well as common norms and rules of organization’s members (Kroeber and Kluckhohn,
1992; Schein, 1985, 1990; Kotter, 1992, 1996; Conner, 1992; Cummings and Worley, 2005). It
is in a certain sense a philosophy that determines organizational policy towards internal and
external surroundings (Pascale and Athos, 1981). Organizational justice influences all aspects of
business and life in a company. It is linked to numerous organizational results (House et al.
2004), and one of them is organizational commitment. Connecting individual aims of employees
to aims of the organization and reliance on responsibility of employees are the factors of
organizational justice successfulness (Morgan, 2004). Organizational justice is also one of
significant factors of employees’ job satisfaction (Moynihan and Pandey, 2007).

2.2.4. Development of Organizational Commitment

According to Jex (2002), most researchers have approached this issue by examining the
development of each of the three bases of commitment proposed by Meyer and Allen (2005). If
one considers affective commitment, a logical supposition might be that employees will tend to
develop this type of commitment if they perceive that the organization is being supportive and/or
treating them in a fair manner (Meyer & Allen, 2005). In fact, research has shown that affective
commitment is positively related to variables such as perceived organizational support (POS) and
procedural justice. POS simply represents the extent to which the organization is seen as helpful
to the employee; in effect, it is “on the employee’s side”.
Another factor that may impact the development of affective commitment is whether the
organization is seen as a source of rewarding outcomes. Research has shown, for example, that a
positive relationship exists between affective commitment and variables such as job scope,
participative decision making, job autonomy, and perceived competence (Meyer & Allen, 2006).
One way to interpret such findings is based on a belief that employees develop feelings of
affective commitment if they see the organization as a place where they feel they are important
and competent.
Another way some researchers have sought to explain affective commitment is through
behavioral commitment and retrospective sense making. Put differently, one might say that
employees develop feelings of affective commitment as a retrospective mechanism to justify
their tenure in the organization and the level of effort they have expended on its behalf. In
general, retrospective explanations of affective commitment have met with very limited support.
However, as Meyer and Allen (2007) point out, this mechanism is quite subtle and thus may be
very difficult to test empirically.

Compared to affective commitment, explaining the development of continuance commitment is

much more straightforward. Most explanations of continuance commitment rely on H. Becker’s
(1999) notion of “side bets” as a mechanism committing one to a course of action. If, for
example, a person has wagered a bet that he or she would lose 20 pounds over the next six
months, this would commit the person to that course of action. When this concept is applied to
the workplace, we can see very clearly that, over time, employees accumulate a number of “side
bets” that commit them to their current employer. For example, the accrual of seniority means
that employees may be entitled to special benefits or privileges. If the employee were to leave
and work for another employer, such benefits would be forfeited. Also, many employees develop
numerous social relationships with their coworkers, and these bonds help to facilitate feelings of
belonging and comfort. These feelings would be forfeited in a switch to another employer.

Another proposed determinant of continuance commitment is the extent to which employees

perceive other viable alternatives to the present employer. The word “perceive” is italicized
because it really doesn’t matter whether actual alternatives exist; the important thing is an
employee’s perceptions. Perceptions of alternatives may be impacted by things in the
environment, such as the unemployment rate, but may also be affected by other, more subjective
factors. For example, an employee’s perception of his or her overall competence, level of
training, and mobility will all enter into the perception of alternatives. As one might guess,
continuance commitment will tend to be higher among employees who perceive few alternatives
to the present employer.

Compared to affective and continuance forms of commitment, much less is known about the
development of normative commitment. According to Meyer and Allen (2007), personal
characteristics and the nature of an employee’s transactions with the organization may impact the
development of normative commitment. At a personal level, individuals may differ in terms of
whether their early socialization emphasized the development of strong loyalty and a sense of
moral obligation to their employer. They also point out that the organization may attempt to
instill in employees, during the initial socialization process, a strong sense of moral obligation to
the organization. Implicit agreement, or a psychological contract, exists between them and the
organization (e.g., Schein, 2001).
A psychological contract essentially represents an employee’s perceptions of what he or she feels
is reasonable treatment as a member of the organization. One would assume that normative
commitment is highest when an employee perceives the organization as honoring its end of the
psychological contract. More research, however, is needed before more conclusions can be
drawn about the development of this form of commitment.
2.2.5. Measurement of Organizational Commitment
As with most subjective attitudinal variables, organizational commitment is measured with self-
report scales. Historically, the first organizational commitment scale to gain widespread use was
the Organizational Commitment Questionnaire (OCQ; Mowday, Steers, & Porter, 2001). The
original OCQ primarily reflected what Meyer and Allen (2001) described as affective
commitment and, to a lesser extent, normative commitment. The original OCQ also contained
one item measuring an employee’s turnover intentions. The inclusion of this item prompted
criticism, particularly when the OCQ was used to predict turnover. Most researchers who have
used the OCQ in recent years have eliminated the turnover intent item. In many cases,
researchers have also used shorter versions of the original measure.
In general, there is evidence that the OCQ has desirable psychometric properties. Mathieu and
Zajac (2000), in their meta-analysis of 124 organizational commitment studies, reported that the
mean internal consistency reliabilities for various forms of the OCQ were all over 80. In this
same study, the OCQ was found to correlate appropriately with conceptually related variables,
thus providing some support for its construct validity. The major limitation of the OCQ is that it
measures primarily the affective component of organizational commitment, and thus provides
very little information on the continuance and normative components. This is an important
limitation because these different forms of commitment are associated with different outcomes.

More recently, Allen and Meyer (2000) developed an organizational commitment measure that
contains three subscales that correspond to the affective, continuance, and normative components
of commitment. An example of an affective commitment is: “This organization has a great deal
of personal meaning to me.” An example of a continuance commitment item is: “It would be too
costly for me to leave my organization in the near future.” Finally, an example of a normative
commitment item is: “I would feel guilty if I left my organization now.” Because the Allen and
Meyer (2000) scale has been developed more recently than the OCQ, comparatively less
evidence has accumulated to support both its reliability and validity. However, the evidence
accumulated to date has been very encouraging. For example, Meyer and Allen (2007) reported
that the median internal consistency reliabilities for the affective, continuance, and normative
commitment scales are .85, .79, and .73, respectively. They also report that all three scales have
exhibited reasonably high levels of temporal stability.

In terms of construct validity, there is also impressive supporting evidence. For example, several
studies have supported the three factor structure of the scale (summarized in Meyer & Allen,
2007). There is also evidence that these forms of commitment are empirically distinguishable
from related constructs such as job satisfaction, values, and occupational commitment. The
construct validity of Meyer and Allen’s measure has also been supported by the pattern of its
relationships with other variables. The important point is that the three subscales corresponding
to the three different forms of commitment appear to correlate with other variables in an
expected manner.
Other than the OCQ and the Allen and Meyer (2000) scales, a handful of other measures of
organizational commitment have surfaced, but none has been used extensively. One recent
measure worth noting was developed by T. Becker (2002). In this study, organizational
commitment was measured in terms of multiple bases (as per Meyer and Allen) and multiple
foci. Few other studies have done this, so there is little empirical evidence on the viability of this
approach to measuring commitment. However, in the future, it may be useful to measure
commitment in this fashion if, indeed, different outcomes are associated with different
combinations of bases and foci of commitment.
2.2.6. Correlates of Organizational Commitment
As with job satisfaction, researchers and managers are interested in organizational commitment
largely because of its relationship with other variables. In this section, we briefly review
evidence on the relationship between organizational commitment and attitudinal variables
absenteeism, turnover and performance.
2.2.6.1. Attitudinal Variables:
Given Meyer and Allen’s (2001) distinction among affective, continuance, and normative
commitment, the correlates of each of these forms of commitment are examined separately.
Affective commitment has been shown to be strongly related to other work-related attitudes.
Mathieu and Zajac (1999) found that the mean corrected correlation between affective
organizational commitment and job satisfaction was .53. Other consistent attitudinal correlates of
affective commitment found in this meta-analysis included job involvement (.36), occupational
commitment (.27), union commitment (.24), and stress (.29).

Compared to affective commitment, less empirical work has examined the relation between
attitudinal correlates of either continuance or normative commitment (Meyer & Allen, 2077).
Based on the little evidence that is available, however, it appears that continuance commitment is
correlated with many of the same variables as affective commitment, yet there are some
important differences. Mathieu and Zajac (2010), for example, found that affective commitment
was more strongly related to job satisfaction and job involvement than was continuance
commitment. Given the dearth of research on normative commitment, very little can be
concluded about its relation with other attitudinal variables.
2.2.6.2. Absenteeism:
Compared to attitudinal correlates, much less evidence exists on the relation between each form
of organization commitment and absenteeism. Mathieu and Zajac (2010) found that the corrected
correlation between affective commitment and attendance was .12 and the correlation with
lateness was −.11. These findings suggest that those with high levels of affective commitment
tend to exhibit lower levels of absenteeism, but this trend is quite weak. Recall from the previous
section that the correlation between absenteeism and job satisfaction is of a similar magnitude
(e.g., Hackett &Guion, 1997). As with job satisfaction, this weak relationship may be due to
variation in the measurement of absenteeism, as well as more general issues in attitude–behavior
consistency. Also, from a conceptual point of view, a high level of affective commitment
indicates a desire to contribute to an organization, a desire that may at times be negated by
situational contingencies.

Again, compared to affective commitment, little evidence exists on the relations between either
continuance or normative commitment and absenteeism. Studies that have been done, however,
have shown neither of these forms of commitment to be related to absenteeism (Meyer & Allen,
2007). From a conceptual point of view, these findings are somewhat surprising. For example, if
an employee’s commitment is of the continuance variety, it in his or her best interest to attend
work on a regular basis; failure to do so could jeopardize his or her membership in the
organization. This argument of course is based on the assumption that organizational policy is
such that frequent absenteeism would be met with negative consequences. With respect to
normative commitment, frequent absenteeism would seem to be inconsistent with commitment
based on a strong moral obligation toward one’s employing organization. Given the little
research that is available, both of these possibilities await examination in future research
2.2.6.3. Employee Turnover:
With the nature of organizational commitment, considerably more evidence exists on the relation
among all three forms of commitment and turnover, compared to other outcomes. As might be
expected, research has generally shown a negative relation among all three forms of commitment
and turnover (Allen & Meyer, 2007; Mathieu &Zajac, 2010). The fact that all forms of
commitment are negatively associated with turnover would appear to be a positive thing for
organizations. However, this may not be true in some cases. For example, consider an employee
who remains in an organization primarily because he or she has a high level of continuance
commitment. Is this necessarily good for the organization, or even for the employee? Such an
individual may adopt an attitude of doing the bare minimum and may be very unhappy in his or
her job. The same may be true for an employee who remains in an organization primarily out of
a sense of moral obligation (e.g., normative commitment).
2.2.6.4. Job Performance:
Much research over the years has investigated the relation between organizational commitments
and job performance. In general, affective commitment has been shown to be positively related
to job performance, although the magnitude of this relation is not strong (Mathieu &Zajac, 2010;
Meyer & Allen, 2007). Determining the mechanisms behind these relations is difficult, however,
because these studies have used a wide variety of performance criterion measures. For example,
some have used supervisors’ ratings of overall performance (e.g., Konovsky&Cropanzano,
1999), others have used objective indexes such as cost control (e.g., Shim & Steers, 1994), and
others have utilized self-ratings of performance (e.g., Baugh & Roberts, 1994).
One commonality among these studies, however, is that the relation between affective
commitment and performance is mediated by employees’ effort. Employees who possess high
levels of affective commitment tend to work harder and exert more effort than employees who
possess lower levels of affective commitment. In some cases, this higher level of effort will
translate into higher levels of performance, although this is not always the case (J. Campbell,
1990, 1994).
This link between affective commitment and effort suggests that commitment is positively
related to performance when employees possess adequate ability, when performance is primarily
determined by motivation, and when employees have some level of control over performance.
This explains why researchers have generally found that affective commitment predicts
organizational citizenship behavior (OCB) better than in-role performance (Meyer & Allen,
1997; Organ & Ryan, 1995). Since OCB is largely motivationally based, employees have greater
control over it than they do over in-role performance.
Compared to affective organizational commitment, considerably less research has examined the
performance-related implications of either continuance or normative commitment. Meyer and
Allen (1997) point out, however, that most of the available empirical research has shown that
neither of these forms of commitment is strongly related to either in-role performance or OCB.
Furthermore, it is difficult to come up with a conceptual justification for why they would be
related to performance. For example, there is no reason why continuance commitment would
prompt an employee to exert high levels of effort or go appreciably beyond his or her required
job duties.
It is somewhat more plausible that high levels of normative commitment would engender high
levels of effort toward organizational goals. One can also make an equally plausible counter
argument that commitment based on employees’ feelings of obligation will not necessarily lead
to greater levels of effort on behalf of the organization. To the contrary, one can even imagine
that an employee who feels compelled to remain in an organization out of a sense of obligation
may even grow to resent that organization and perhaps be compelled to engage in
counterproductive behaviors.

2.2.7. Factors affecting the level commitment

According to Armstrong (2009), Kochan and Dyer (2003) have indicated that the factors
affecting the level of commitment in what they call ‘mutual commitment firms’ are as follows:
Strategic level: supportive business strategies, top management value commitment and effective
voice for HR in strategy making and governance.
Functional (human resource policy) level: staffing based on employment stabilization,
investment in training and development and contingent compensation that reinforces
cooperation, participation and contribution.
Workplace level: selection based on high standards, broad task design and teamwork, employee
involvement in problem solving and a climate of cooperation and trust.

2.3. Empirical Review

Empirical studies have shown that turnover intentions are functions of several variables such as
compensation/financial reward, supervisor support & leadership, Training, job security, working
environment (Brown, McHardy, McNabb and Taylor, 2011). Jordan (2012) suggests that most of
the theoretical literature contends that before individuals leave an organization, they progress
through a series of stages of psychological and behavioral withdrawal. (Scott, 2007) for example,
asserted that absence is a miniature form of turnover. He states that the position of leaving a job
is the outcome of a chain of experiences building up to the final break events on a smaller scale.
Signs such high absenteeism tend to manifest earlier as turnover becomes the dying state of a
lively process of leaving. However, with the changing nature of jobs, more study has to be done
focusing on the effect or impact of turnover intentions on employees’ commitment (Bin, 2011).

To see the relationship and the nature of both organizational citizenship behavior and
organizational commitment, the student researcher has gone through various literatures and the
following empirical research is believed to demonstrate that there is little difference between the
two.

2.3.1. Relationship between organizational commitment and citizenship

behavior
According to an empirical research conducted by Rehan M. & Islam T (2013), under the title of
“Relationship between organizational commitment and citizenship behavior”, the relationship
between Organizational Citizenship Behavior (OCB) and Organizational Commitment (OC) has
been empirically tested via their respective dimensions.
According to Organ, D.W. (1988), Organizational Citizenship Behavior (OCB) is defined as, “an
individual behavior that is discretionary, not directly or explicitly recognized by the formal
reward system and that in the aggregate promotes the effective functioning of the organization. It
has three distinct dimensions:
Altruism: is the willingness of an employee to help the co-worker into their work and also the
selflessness of an employee towards his organization.
Conscientiousness: refers to discretionary behaviors that go beyond the basic requirements of
the job in terms of obeying work rules, attendance, and job performance. In other words,
conscientiousness means the scrupulous obedience to organizational rules and procedures, even
when no one is watching.
Civic Virtue: refers to behaviors that demonstrate a responsible concern for the image and
wellbeing of the organization
At a very general level, organizational commitment can be thought of as the extent to which
employees are dedicated to their employing organization and are willing to work on its behalf,
and the likelihood that they will maintain membership (Jex, 2002: P133). Accordingly,
organizational commitment also has three distinct dimensions:
Affective Commitment: an affective or emotional attachment to the organization such that the
strongly committed individual involves and enjoys membership in the organization
Normative Commitment: refers to perceived obligation of the employees to remain with the
organization.
Continuance Commitment: refers to commitment based on the costs that the employee
associates with leaving the organization.

Organizational commitment (OC) for many years has been identified as an important factor to
understand the relationships between the employee and the employer. Organizational
commitment is one of the important factors which contribute to foster Organizational citizenship
behavior. An employee’s organizational commitment is positively related to organizational
citizenship behavior. Results of previous researches show that commitment is the predictive of
organizational citizenship behavior because it significantly impacts on OCB.

The present study was an attempt to find the relationship between dimensions of organizational
commitment (i.e. affective, normative and continuance) and key determinants of organizational
citizenship behavior (i.e. altruism, Conscientiousness and civic virtue). Some important findings
of the study are that; all the dimensions of organizational commitment significantly correlate
with the key determinants of organizational citizenship behavior. The employees having
emotional attachment with their organizations and want to continue with the organizations, not
only put their efforts to lift up the organization but also help their coworkers. Thus an
organization should win the commitment of its key employees to have positive image globally.
2.4. Conceptual Framework
This conceptual framework is developed as per the above empirical research conducted by Irshad
M. (2012). Accordingly, employees’ commitment affecting factors are normally designed to
boost the organizational commitment intent buried deep down in every employee given that all
employees are assumed to have something to bring to the table as long as their tenure in the
organization continues. Hence, by introducing meaningful and current retention programs for the
accomplishment of organizational commitment, the company will benefit from the continued and
unwavering service of its employees that are committed not only to get to the office in time and
leave late, but be engaged to contribute something that will become meaningful and worth a
while to the company.

The overall conceptual frame work for this particular research revolves around the effect of the
independent variables on the dependent variable in the case of our subject company. Factors that
affect employees’ organizational commitments such as HRM practices in compensation, job
security, training, supervisor support, work environment, and organization justice are assumed to
be independent variables whereas organizational commitment in its affective, continuance, and
normative forms is the dependent variable as depicted hereunder:
Figure 2: Conceptual Frame work

compensation
r
Employees ‘Organizational Commitment

•
Dependent Variable

Job security
In dependent Variables

Training
efb

Supervisor
Support

Work
Enviroment

 Organizational
Justice
Source: Developed by the researcher from the reviewed literature.

Chapter Three

Research Methodology
In this section the research design and methodology are discuss in detail so as to paint a clear
road map on how the study will be carry out and the instruments that is uses in data collection &
analysis. It also illustrates how the population is dissected in order to reach at a valid sample size
that believes to represent the population.

3.1. Research Design

There are three types of research design exploration, descriptive and explanatory purpose behind
this study is the factors affect overall employee organizational commitment.

This research use explanatory and descriptive research design additionally quantitative approach.

According to Kotair (2004, P: 5), quantitative data collection involves the generation of data in
quantitative form which can be subjected to rigorous quantitative analysis in a formal and rigid
fashion. The purpose of quantitative approach to research is to form a data base from which to
infer characteristics or relationships of population. Furthermore, a survey design provides a
quantitative or numeric description of trends, attitudes, or opinions of a population by studying a
sample of that population. From sample results, the researcher generalizes or makes claims about
the population (Creswell, 2003).

The research is carry out by using descriptive and explanatory research design so as to explain
what currently exists and also to draw conclusion from the statistical analysis.
According to Tayie (2005), a descriptive research attempts to picture or document current
conditions or attitudes, that is, to describe what exists at the moment. This research design is
chosen because of its resource economy nature and its proven validity and reliability.

3.2. Population and Sampling

The population for this particular study select from permanent professional employees of head
office and North Addis Ababa regional branches of AB that includes department directors, all
Levels of managers, all levels of accountants, branch auditors, senior customer service officers
(SCSO), Customer service officers (CSO), and junior bankers (JB).

Table 3.1: Detail Description of Population as per employee profile of AB maintained as at

December, 2023 G.C.

Positions Category
North Addis Ababa Regional Branches

Non-Clerical
Professional
Managerial

Clerical
Both Located in head office and

Total Population
Female

Female

Female

Female

Female
Male

Male

Male

Male

Male

74 28 63 19 383 129 374 117 894 293

Total 74 52 276 491 1187

Source: Own survey result (2023)

Accordingly, based on the above size of the population, sample size will be determined using

YEMEN sampling formula’s=N/1+N(e)2

 Where: n = Total Samples size

N = Total Population and

e = Error occurrence (5%) or 0.05

According to HR data collect from head office and North Addis Ababa regional branches as of
May, 2023, the bank has total of 1187 employees out of which 491 employees are found to be
non-clerical, 294 employees has below six month of service in the bank. The bank has a policy
which states that, all employees needs to serve the bank for a period not less than six months so
as to be eligible for some kinds of employee benefit programs there by rendering them null and
void for this particular research. Accordingly, the population will automatically become 402
employees.

Therefore:

The confidence level is assumed to be 95%, so error occurrence for the research is 0.05Total
Sample size (n) = 402/1+402*(0.05)2

=402/1+402(0.0025)

=201

201 participants were taken as a sample size.

The researcher uses two stag sampling for this particular study. Samples are select using a
special type of Cluster Sampling known as Area Sampling. According to C.R. Kothair (2004:
P65), If the total area of interest happens to be a big one, a convenient way in which a sample
can be taken is to divide the area into a number of smaller non-overlapping areas and then to
randomly select a number of these smaller areas (usually called clusters), with the ultimate
sample consisting of all (or samples of) units in these small areas or clusters. If clusters happen
to be some geographic subdivisions, in that case cluster sampling is better known as area
sampling. In other words, cluster designs, where the primary sampling unit represents a cluster of
units based on geographic area, are distinguished as area sampling.
After the area sampling, the sample will put under a systematic sampling which yield in the final
participants of the study. In some instances, the most practical way of sampling is to select every
ith item on a list. Sampling of this type is known as systematic sampling. An element of
randomness is introduced into this kind of sampling by using random numbers to pick up the unit
with which to start (C.R. Kothair, 2004). Accordingly, branches of the bank are taken as clusters
and the head office is taken as the last cluster. Hence, the sample distribution incorporates all
clusters as an individual unit which then went through a systematic sampling to determine the
final sample.

To calculate the sample size of each group stratums from three positional categories of Awash
Bank (Head office & North Addis Ababa regional branches, the researcher uses the following
formula.

ni=Ni/(N/n) Where

ni=sample size for each grouped positional employees

Ni=sub grouped employees or number of population in each position.

N =total target population (permanent)

n=total sample size

i=1, 2, 3, 4…………….

Table 3. 2: Sample to be taken from each positions /size and distribution of questionnaire

No. Position Category Target Population Sample Size

1 Managerial 74 37

2 Professional 52 26

3 Clerical 276 138

Total 402 201

Source: Own survey result (2023)

ni=Ni/(N/n)

Sample size distribution for each position category is made by multiplying percentage of target
population will include in the sample.

3.3. Source of Data

This study uses both primary and secondary source of data. Primary source of data was collect
from Awash Bank head office and North Addis Ababa city branches. The primary data is collect
through Questionnaire. The questionnaires were disseminating and fill by the permanent
employees of Awash Bank (Head office and North Addis Ababa city branches). The
questionnaires are closed ended questions. The closed-ended questions is use to collect
background information about the respondent. It covers the personal information, institutional,
determinant factors/ variables related questions. And secondary source of data is collect from
different relevant written documents, websites, magazines, articles, journals, annual reports,
quarterly bulletins, various reports regarding to factors affecting organizational document.

3.4. Procedures of Data Collection

Hard copies of the questionnaire were distributing to select branches & head office sectors
staffs. The respondents (participants) who need further explanation on the questionnaire and any
other related item are communicated via e-mail, telephone and face to face so as to minimize the
risk of misinterpretation and misconceptions. Responses are collect personally by the researcher
and via wide area network outlook emailing system.

3.5. Methods of Data Analysis

The collect data will review for completeness and correctness of responses. The data is
quantitatively examined using descriptive statistics will use to analyze the collect data via
questionnaire. SPSS version 20 is use to analyze the data. Regression model will use to analyze
the effect of the independent variables on the dependent variable. Regression allows you to
estimate how a dependent variable change as the independent variable change. Multiple Linear
regression is used to estimate the relationship between two or more independent variables and
one dependent variable.
3.6. Ethical Issues of Research
The ethical issues considered in this study include worthiness, consent, and confidentiality. To
ensure informed consent, respondents and all those who participated in this study were provided
with all the relevant information about this study in order to ensure that they understood the
nature of the study, objectives of the research and the benefits to the researcher. This process
further ensured that the study did not misbehave the behavioral norms established by
organizations being studied. Also, findings were reported in a complete and honesty fashion,
without misrepresenting any responses given or intentionally misleading readers and researchers
interest in this study.

3.7. Validity and Reliability Checks

Validity means that correct procedures applied to find answers to a question. To achieve the
validity in the instruments of data collection, the instruments which are initially prepared in
English language, and checked by advisor in order to comment the extent to which the items are
appropriate in securing relevant information to the research. As discussed above, all the items
that were develop to address the research questions under investigation made to maintain validity
of the instruments of the study.
Best and Kahn (2002:166) describe that the items of the instrument should represent a significant
aspect of the purpose of the investigation. Content validation was established by cross-
referencing the content of the instruments to those elements contained in the basic research
questions. That is, the items construct will in line with the answer to the research questions.
Content validity addressed to what extent the appropriate content is representing in
questionnaires guide items. Validity looks at whether the instrument measures what it is intend to
measure and whether the instrument draw accurate information. The researcher made change or
replaces the construction of some items in the questionnaires guide based on the consultation of
the after feedback received from advisor. The main issue of reliability is addressing the
consistency of the instruments in relation to what they intend to measure.
Accordingly, the basic idea of reliability is summarized up by the word consistency. The
researcher adopted different standardized measurements scale of employee’s organizational
commitment.
3.8. WORK PLAN, TIME BREAK DOWN AND BUDGET
3.8.1. Work Plan
The length of the academic year and the size of the underlying research problems will be taken
into account when determining the proposed timeframe for the study effort below. Nevertheless,
it is still open to modification and flexibility in response to any considerations and instructions
that may be providing by the academic department or research unit of the relevant university.
Table 3.3. Time Break Down

Duration and Period

S/N Associated Activities Nov. Dec. Jan. Feb. Mar. Apl. May.

1 preparation of research proposals

2 review of the literature and preparation

3 creation and submission of research

proposals

4 Presentation of the proposal and final

approval

5 development and evaluation of data

collection tools

6 Actual data gathering and filling up

information gaps

7 Data entry, data analysis, and research

report preparation

8 submit the report's initial draft

Table 3.4. Budget Break Down

Item Unit Quantity Per Total cost

unit(birr)

Photo copy pack 9 80 720

paper

Pen pack 2 310 620

Pencil Pack 2 40 80

Writing pads no 18 11 198

Binder no 2 15 30

Total cost 1648

Table 3.5. Data Collection Expense

Payable to No. Days Daily Total cost in
per-diem rand

Enumerator 10 1 500 5000

training

Facilitators 5 6 300 9000

payment

Enumerator 10 6 500 30000

accommodation

Total Cost 44000