THE EFFECT OF EMPLOYEE MOTIVATION ON

ORGANIZATION PERFORMANCE
(In Case Of Commercial Bank of
Ethiopia in Dire Dawa Branch)

THE RESEARCH PAPER SUBMITTED IN PARTIAL

FULFILLMENT OF THE REQUIREMENT BA DEGREE
IN MANAGEMENT

PREPARED BY: HABTAMU ALEMAYEHU

ADVISOR: TAMIRAT. K (MBA)

DIRE DAWA UNIVERSITY

COLLEGE OF BUSINESS AND ECONOMICS
DEPARTMENT OF MANAGEMENT

May, 20016
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 Advisor Ato Tamirat 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.

I
 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 Dire Dawa branch. The relevant data for this study collected
from both primary and secondary sources. To collect primary data self-
administered questionnaire used. Whereas, secondary data collected by
organizational records and written materials about the organization.
Simple random sampling used to collect data from employees because of
they were large in numbers. The collected data 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 company 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

II
 Table of contents
Content Page
ACKNOWLEDGEMENT .......................................................................................................... I
ABSTRACT ....................................................................................................................... II
TABLE OF CONTENTS .......................................................................................................... III
LIST OF TABLE................................................................................................................. V
CHAPTER ONE ..................................................................................................................... 1
1. INTRODUCTION ............................................................................................................... 1
1.1 BACKGROUND OF THE STUDY............................................................................................. 1
1.2. BACK GROUND OF THE ORGANIZATION ............................................................... 2
1.3. STATEMENT OF PROBLEM ..................................................................................... 4
1.4 OBJECTIVES OF THE STUDY .................................................................................. 5
1.4.1 General objective ........................................................................................ 5
1.4.2 SPECIFIC OBJECTIVE .......................................................................................... 5
1.5 SIGNIFICANCE OF THE STUDY ................................................................................ 6
1.6 SCOPE OF THE STUDY ............................................................................................ 6
1.7 LIMITATION OF THE STUDY .................................................................................... 6
CHAPTER TWO .............................................................................................................. 7
2. REVIEW OF RELATED LITERATURE .............................................................. 7
2.1 MOTIVATION .............................................................. ERROR! BOOKMARK NOT DEFINED.
2.2 HOW TO MOTIVATE EMPLOYEES............................................................................ 7
2.3 CHALLENGES OF MOTIVATION .............................................................................. 8
2.4 IMPORTANCE OF MOTIVATION ................................................................................ 8
2.5 SOURCE OF MOTIVATION ....................................................................................... 9
2.6 THEORIES OF MOTIVATION.................................................................................... 9
2.6.1 Maslow theory ............................................................................................. 9
2.6.2 Alderperson ERG theory ........................................................................ 10
2.6.3 McClelland’s Theory ................................................................................ 11
2.6.4 Motivation, Performance and Job satisfaction ............................... 12
2.6.5 Consequence of Job dissociation........................................................ 12
CHAPTER THREE ....................................................................................................... 19
MATERIALS AND RESEARCH METHODOLOGY .............................................. 19
3.1 STUDY AREA .......................................................................................................... 19
3.2 TYPES AND SOURCES OF DATA ....................................................................... 19
3.3 METHODS OF DATA COLLECTION ....................................................................... 19

III
 3.4 METHOD OF DATA ANALYZING ............................................................................. 20
CHAPTER FOUR .......................................................................................................... 21
4. DATA ANALYSIS AND INTERPRETATION ................................................... 21
4.1. GENERAL EMPLOYEES BACKGROUND ............................................................... 21
4.2. MOTIVATIONAL PRACTICE ................................................................................... 22
4.3. MOTIVATIONAL IMPACT ....................................................................................... 23
4.4. ADDITIONAL REWARD SYSTEM ........................................................................... 24
4.5. SECURITY OF JOB................................................................................................ 24
4.6. PUNCTUALITY OF EMPLOYEES ............................................................................ 25
4.7. STAYING IN ORGANIZATION ................................................................................. 26
4.8. EFFECT OF MOTIVATION ..................................................................................... 27
4.9. EFFECT OF ABSENTEEISM.................................................................................. 27
CHAPTER FIVE ............................................................................................................ 29
5. CONCLUSION AND RECOMMENDATION ..................................................... 29
5.1 CONCLUSION ......................................................................................................... 29
5.2. RECOMMENDATION ............................................................................................. 30
APPENDIX...................................................................................................................... 32

IV
 List of table
Page
TABLE 4.1 AGE, SEX, EDUCATIONAL LEVEL AND MARTIAL TUTUS OF
RESPONDENTS ....................................................................................................................................... 21
TABLE 4. 2. RESPONSE ON MOTIVATIONAL PRACTICE IN ORGANIZATION ................... 22
TABLE 4. 3, RESPONSE ABOUT MOTIVATIONAL IMPACT ON PRODUCTIVELY ............. 23
TABLE 4.4. RESPONSE ABOUT ADDITIONAL REWARD SYSTEM ........................................ 24
TABLE 4. 5. RESPONSE ON SECURITY OF JOB ......................................................................... 24
TABLE 4.6 RESPONSE ABOUT PUNCTUALITY OF EMPLOYEES .......................................... 25
TABLE 4. 7. RESPONSE ON STAYING IN ORGANIZATION ...................................................... 26
TABLE 4.8 RESPONSE ABOUT EFFECT OF MOTIVATION ...................................................... 27
TABLE 4.9. RESPONSE ON ABSENTEEISM OF EMPLOYEES ................................................ 27
TABLE 4.10. RESPONSE ON WHO FAIRLY REWARDED IN THE ORGANIZATION .......... 28

V
 CHAPTER ONE
1. Introduction
1.1 Background of the study

The success of any business depends largely on the motivation of the

employees. Human resource 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 needs 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
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.

Following the agreement, the first bank called bank of Abyssinia was in
gurated in February 16, 1906 by 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

2
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.

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 provides to
its customers.
7. Act as an agent for persons and in this capacity, engage in the sale of
money and shares.

3
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 individualize. 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 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

4
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 DireDawa branch motivates its employees?
2) What methods does the organization use to motivate its
employees?
3) What type 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 organization performance.

1.4.2 Specific objective

✓ To identify what methods 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

5
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 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
create 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 DireDawa 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 Dire Dawa
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.

6
 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.([email protected])

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 has 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.

7
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).

8
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 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 present 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 need hierarchy, source (Diver, 1994.PP14).
Maslow categorize the need in to the following five.

9
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).

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 need 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

10
 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
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

11
 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 dissoliation

Job dissatisfaction produce 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.

12
 - 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. Learning how to motivate is now one of the most relevant
and essential skills leaders can possess in to 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

13
 - 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 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 don 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, buy 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

14
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.
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:

15
 - 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, 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.
- 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

16
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 surfins 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 hages or
uncertainty within the organization. No matter what the cause, having

17
the reputation of having unpleasant work environment due to low
employee motivation will ultimately impact how existing and potential
clients or parents view working with an organization. A reputation can
precede on organization and indicate its future in the industry

Source: www.ehow.combuisenss
.

18
 CHAPTER THREE
3.Materials and research methodology
3.1 Study area
The study conducted in Eastern Oromia region Dire Dawa town which is
found on 550 km from the capital city of Addis Ababa. This study
conducted on effect of employee motivation on the organization
performance (in case of commercial bank of Ethiopia in Dire Dawa
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 sources of data is
employees and management bodies of the organization. Secondary
sources is publishes 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

a. Sample Design
Sample technique
In conducting this study the researcher was used simple random
sample technique. Because it remove personal judgment and
unbiased sample besides. This each elements has equal chance of
being selected in the sample. There for the total number of
employees the researcher selected were 55 employees to fill the
questionnaires.

19
 b. Sample Size
The total number of employees of the Commercial Bank of
Ethiopia in Easter region in Dire Dawa branch is 294, 55 were
selected by using simple random sampling technique. The sample
size is determined by using the following formula.

n = Z2*p*q*N

2
E (N-1)+Z*P*q
WHERE z= Confidence (1.64) 90%
N = population size
n = sample size
p =population proportion
q =number of probability
e =error =10%
2
n =1.64 *0.5*0.5*294
2 2
0.1 (294-1)+ 1.64 *0.5*0.5 =55
n =55

3.4 Method of data analyzing

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

20
 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 Percentag

respondents e
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, 2016

21
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 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. 1. Response on motivational practice in organization

Items Response Number of Percentag

respondent e
Is there Yes 43 100
motivational NO
practice in your
organization
Total 43 100
If you said “Yes” for Financial 43 100
above question Non finical - -
which types of
motivational tools?
Total 43 100

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 practice in the organization, it is better for organization to
practice motivation in order to enhance productivity. In addition, all

22
employee show said yes for existence of motivational practice in
organization again the said there were financial motivation in
organization

4.3. Motivational impact

Table 4. 2, Response about motivational impact on productively

Items Response Number of Percenta

responden ge
t
What is your opinion about the Satisfied -
payment system of the Very satisfied -
organization? Dissatisfied -
neutral 43 100

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

Total 43 100
Source: compiled from questionnaire, 2016

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.

23
4.4. Additional reward system
Table 4.4. Response about additional reward system
Items Response No of Percen
respondent tage
number
Is there additional reward Agree 26 61
system to who Performance Disagree 17 39
better Strong agree -
Strong disagree -

Total 43 100
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 Percentag

response e
What do you think Satisfied 28 65
about job security Dissatisfied -
of the organization neutral 15 35

Total 43 100

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 satisfied on
their job security of the organization.

24
4.6. Punctuality of employees
Table 4.6 Response about punctuality of employees
Items Response No of response Percentage
Are you punctual for your Yes 28 65
job NO 15 35
Total 43 100
Items Response No of response Percentage
If you responded for The 15 35
question above No what is motivationa
the reason? l practice is
not good in
the
organization
Total 15 35

The above able show 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
not 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. for who not punctual for

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

25
 4.7. Staying in organization

Table 4. 7. Response on staying in organization

Items Respons No of Percentag
e response e
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 I have do 30 69
your contribution? my
duties &
responsi
bility
effectivel
y
Total 30 69
Complied from questionnaires 2016

The above tale show 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 it performance.

26
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 Disagree 18 42
your organization? Strong - -
agree 25 58
Strong
disagree

Total 43 100
Complied from questionnaires 2016

The above table show 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

Table 4.9. Response on Absenteeism of employees

Items Response No of Percentag

response e
Is there effect Absenteeism of Agree 33 78
employee from job on the Disagree 10 22
organization performance? Strong agree
Strong
disagree
NO
Total 43 100
Your salary level is satisfactory? Satisfied 12 28
very satisfied - -

27
 dissatisfied - -
neutral 31 72

Total 43 100
Complied from questionnaires 2016

The above tale show 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.

Table 4.10. Response on who fairly rewarded in the organization

Items Response No of Percentage

response
Employees are fairly Agree 26 60
rewarded in your Strong agree -
organization? Disagree 17 40
Strong disagree -

Total 43 100
Complied from questionnaires 2016

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 increase both reward
and motivation, the degree of turnover not punctual.

28
 CHAPTER FIVE
5. Conclusion and recommendation
5.1 Conclusion
Most of the employees of commercial banks of Ethiopia in Dire Dawa
Brach 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.

29
 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 Dire Dawa Brach.

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 organization were good in a system of staying employees,

they should continue in a good manner for future.

30
Reference

✓ Davis and new arom (1989) Human behavior at work

✓ Dessler (1998) Human resource management 9th edition
✓ Ivan ceviche and Matheson. 1990. Organizational behavior USA, Richard
D.Irwism Inc.
✓ Bernard L.Rosembaum.1982.How to motivate to days workers USA, MCG raw
Hill book co.

31
 Appendix
Dire Dawa University
School of business and economics
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 Dire Dawa branch.. Responding to this
questionnaire will not create any harm. Therefore you are kindly
requested to respond with confidence while you are asked.

No need to write your name

i) Put a “X: mark for your answer
ii) Please give brief description for open ended questions.
iii) For closed end question give your answer on the space provided.
Iv Respondents back ground/
1.1 Sex male  female 
1.2 Age less than 25 years  26-35 years 
36- 45 years  46 -55 years above 56 
1.3 Education level
Diploma  first Degree  PHD 
Master (2nd Degree) 
1.4 Marital status
Married  Widow  UN married  Divorce 

1) Is there motivational practice in your organization?

Yes  No 
2) If you said “yes” for question one which types of motivation?
Financial  non-financial 

32
 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 preformance 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

33
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

34